Document:

Exhibit 10.(l)

    
      

    

    Exhibit
      10(l)

     

     

    
 

    
      
        

      

      
        

      

    

    NOTE
      AND WARRANT PURCHASE AGREEMENT

    

    DATED
      AS OF MARCH 21, 2007

    

    AMONG

    

    TIMOTHY
      J. TEGELER,

    

    LEWIS
      B. SHEPLEY,

    

    SIBONEY
      CORPORATION

    

    AND

    

    SIBONEY
      LEARNING GROUP, INC.

    

    

     

    
      
        
          

        

        
          

        

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Table
      of Contents

     

    
      	
               

               

            	
               

               

            	
               

               

            	
              Page

               

            
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              Section

            	
              1.

            	
              Definitions
                and Related Matters

            	
              1

            
	
               

            	
              1.1

            	
              Definitions

            	
              1

            
	
               

            	
              1.2

            	
              Other
                Defined Terms

            	
              7

            
	
               

            	
              1.3

            	
              Accounting
                Principles

            	
              8

            
	
               

            	
              1.4

            	
              Other
                Interpretive Matters

            	
              8

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              2.

            	
              Authorization
                and Closing

            	
              9

            
	
               

            	
              2.1

            	
              Authorization
                of the Securities

            	
              9

            
	
               

            	
              2.2

            	
              Purchase
                and Sale of the Securities

            	
              9

            
	
               

            	
              2.3

            	
              The
                Closing

            	
              9

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              3.

            	
              Conditions
                of each Purchaser’s Obligation at the
                Closing

            	
              9

            
	
               

            	
              3.1

            	
              Representations,
                Warranties and Covenants; No Event of
                Default

            	
              9

            
	
               

            	
              3.2

            	
              Charter

            	
              10

            
	
               

            	
              3.3

            	
              Organizational
                Documents

            	
              10

            
	
               

            	
              3.4

            	
              Security
                Documents

            	
              10

            
	
               

            	
              3.5

            	
              Sale
                of Securities to the Purchaser

            	
              10

            
	
               

            	
              3.6

            	
              Securities
                Law Compliance

            	
              10

            
	
               

            	
              3.7

            	
              Subordination
                Agreement

            	
              10

            
	
               

            	
              3.8

            	
              Proceedings

            	
              10

            
	
               

            	
              3.9

            	
              Closing
                Documents

            	
              10

            
	
               

            	
              3.10

            	
              Equity
                Investment

            	
              10

            
	
               

            	
              3.11

            	
              Waiver

            	
              11

            
	 	 	 	 
	 	 	 	 
	
              Section
                

            	
              4.

            	
              Covenants

            	
              11

            
	
               

            	
              4.1

            	
              Affirmative
                Covenants

            	
              11

            
	
               

            	
              4.2

            	
              Note
                Negative Covenants

            	
              12

            
	
               

            	
              4.3

            	
              Compliance
                with Agreements

            	
              14

            
	
               

            	
              4.4

            	
              Use
                of Proceeds

            	
              14

            
	
               

            	
              4.5

            	
              Pro
                Rata Payment

            	
              14

            
	
               

            	
              4.6

            	
              Current
                Public Information

            	
              14

            
	
               

            	
              4.7

            	
              Intellectual
                Property Rights

            	
              14

            
	
               

            	
              4.8

            	
              Additional
                Subsidiaries

            	
              15

            
	
               

            	
              4.9

            	
              Further
                Assurances

            	
              15

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              5.

            	
              Transfer
                of Notes

            	
              15

            
	
               

            	
              5.1

            	
              General
                Provisions

            	
              15

            
	
               

            	
              5.2

            	
              Opinion
                Delivery

            	
              15

            
	
               

            	
              5.3

            	
              Information
                Requests

            	
              15

            
	 	
              5.4

            	
              Legend
                Removal

            	
              15

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              6.

            	
              Representations
                and Warranties of the
                Borrowers

            	
              16

            
	
               

            	
              6.1

            	
              Organization,
                Corporate Power and Licenses

            	
              16

            

    

     

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

    
      
        
        

      

       

    

    
      	
               

            	
              6.2

            	
              Authorization;
                No Breach

            	
              16

            
	
               

            	
              6.3

            	
              Solvency,
                Etc. 

            	
              16

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              7.

            	
              Events
                of Default

            	
              16

            
	
               

            	
              7.1

            	
              Definition

            	
              16

            
	
               

            	
              7.2

            	
              Consequences
                of Events of Default

            	
              18

            
	 	 	 	 
	 	 	 	 
	
              Section

            	
              8.

            	
              Miscellaneous

            	
              19

            
	 	
              8.1

            	
              Expenses

            	
              19

            
	
               

            	
              8.2

            	
              Remedies

            	
              20

            
	
               

            	
              8.3

            	
              Purchaser’s
                Investment Representations

            	
              20

            
	
               

            	
              8.4

            	
              Amendments
                and Waivers

            	
              20

            
	
               

            	
              8.5

            	
              Survival
                of Agreement

            	
              21

            
	
               

            	
              8.6

            	
              No
                Setoffs, Etc.

            	
              21

            
	
               

            	
              8.7

            	
              Successors
                and Assigns

            	
              21

            
	
               

            	
              8.8

            	
              Aggregation

            	
              21

            
	
               

            	
              8.9

            	
              Severability

            	
              21

            
	
               

            	
              8.10

            	
              Counterparts

            	
              22

            
	
               

            	
              8.11

            	
              Descriptive
                Headings

            	
              22

            
	
               

            	
              8.12

            	
              Governing
                Law

            	
              22

            
	
               

            	
              8.13

            	
              Notices

            	
              22

            
	
               

            	
              8.14

            	
              Construction

            	
              22

            
	
               

            	
              8.15

            	
              Complete
                Agreement

            	
              23

            
	
               

            	
              8.16

            	
              Indemnification

            	
              23

            
	
               

            	
              8.17

            	
              Payment
                Set Aside

            	
              24

            
	
               

            	
              8.18

            	
              Jurisdiction
                and Venue

            	
              24

            
	
               

            	
              8.19

            	
              Waiver
                of Right to Jury Trial

            	
              24

            
	
               

            	
              8.20

            	
              Certain
                Waivers

            	
              25

            
	
               

            	
              8.21

            	
              Joint
                and Several Liability of the Security
                Parties

            	
              25

            
	
               

            	
              8.22

            	
              Several
                Liability of Purchasers

            	
              25

            

    

    
 

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

    SIBONEY
      CORPORATION

    SIBONEY
      LEARNING GROUP, INC.

     

    NOTE
      AND WARRANT PURCHASE AGREEMENT

     

    THIS
      NOTE
      AND WARRANT PURCHASE AGREEMENT
      (this
“Agreement”)
      is
      made as of March 21, 2007, among Siboney Corporation, a Maryland corporation
      (the “SBON”),
      Siboney Learning Group, Inc., a Texas corporation (“SLG”),
      together with any other Persons from time to time joined as parties hereto
      as a
      borrower, collectively being referred to herein as the “Borrowers”
and
      individually as a “Borrower”),
      Timothy J. Tegeler, a Missouri resident (“Tegeler”),
      Lewis
      B. Shepley (“Shepley”),
      and
      each of the other holders of Securities (as defined below), if any, who becomes
      a party hereto in accordance with the terms hereof (Tegeler, Shepley and such
      other holders are collectively referred to herein as the “Purchasers”
and
      individually as a “Purchaser”).

     

    The
      parties hereto agree as follows:

     

    Section
      1. Definitions
      and Related Matters.

     

    
      1.1 
        Definitions.
        For the
        purposes of this Agreement, the following terms have the meanings set forth
        below (such meanings to be applicable to both the singular and plural forms
        of
        the terms defined):

    

     

    “Affiliate”
of
      any
      particular party means: (i) any other party which directly or indirectly,
      controls or is controlled by or is under common control with the specified
      party, (ii) any party owning or controlling 20% or more of any class of the
      outstanding voting securities of the specified party, (iii) any officer,
      director, partner, manager, member, trustee or employee of the specified party
      or anyone acting in a substantially similar capacity, (iv) any entity for which
      a party described in clause (i), (ii) or (iii) acts in such capacity, and (v)
      any and all of the agents, employees and attorneys of the specified party or
      any
      other party described in this paragraph.

     

    “Board”
means
      the Board of Directors of SBON.

     

    “Business
      Day”
means
      any day other than Saturday, Sunday or any day on which banks in the City of
      St.
      Louis, Missouri are closed.

     

    “Capital
      Stock”
means
      all of the equity or other ownership interests in a Person, including, without
      limitation, Convertible Securities and other rights containing phantom or other
      equity participation features.

     

    “Capitalized
      Lease”
means
      a
      lease under which the obligations of the lessee should, in accordance with
      GAAP
      consistently applied, be included in determining total liabilities as shown
      on
      the liability side of a balance sheet of the lessee.

     

    “Capitalized
      Lease Obligations”
means
      the amount of the liability reflecting the aggregate discounted amount of future
      payments under all Capitalized Leases calculated in accordance with GAAP
      consistently applied and Statement of Financial Accounting Standards No. 13
      or
      any successor accounting standard.

     

    “Change
      in Control”
means:
      (i) any sale, transfer, issuance or series of sales or issuances of Capital
      Stock by SBON or any holder or holders thereof, or any merger, consolidation
      or
      other

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    transaction
      involving SBON, immediately after which (a) the holder or holders of Capital
      Stock immediately prior to such transaction or transactions no longer possess
      the voting power to elect a majority of the board of directors (or similar
      governing body) of the Person surviving the transaction or (b) the holder or
      holders of Capital Stock immediately prior to such transaction or transactions
      no longer hold record and beneficial ownership of at least 50% of the voting
      Capital Stock of the Person surviving the transaction; (ii) any sale of all
      or
      substantially all of a Borrower’s and its Subsidiaries’ assets on a consolidated
      basis; (iii) after the Closing, any Person or group of Persons (within the
      meaning of Section 13 or 14 of the Securities Exchange Act) that did not hold
      any Capital Stock of SBON at Closing (other than the Purchasers and their
      Affiliates and transferees) shall acquire beneficial ownership (within the
      meaning of Rule 13d-3 promulgated under the Securities Exchange Act) of more
      than 25% of the Capital Stock of SBON (on a fully diluted basis and taking
      into
      account any Capital Stock of SBON having voting rights in the election of
      members of the Board (or similar governing body)) under normal circumstances;
      (iv) any Borrower (other than the SBON) shall cease to be a Wholly-Owned
      Subsidiary of SBON; or (v) the members of the Board (or similar governing body)
      on the date hereof shall cease to constitute a majority of the members of the
      such Board.

     

    “Code”
means
      the Internal Revenue Code of 1986, as amended, and any reference to any
      particular Code section shall be interpreted to include any revision of or
      successor to that section regardless of how numbered or classified.

     

    “Collateral”
means
      all personal and real property in which a security interest or other lien has
      been granted to or for the benefit of the Purchasers pursuant to the Security
      Documents and/or any other Investment Documents or which otherwise secures
      the
      payment or performance of any of the Notes.

     

    “Common
      Stock”
      means
      the common stock of SBON, $0.10 par value per share, and any securities into
      which such common stock may hereafter be reclassified.

     

    “Consolidated
      Total Assets”
means,
      on any date, the carrying value of all assets, net of corresponding allowances
      and reserves of the Borrowers on that date, determined on a consolidated basis
      which, in accordance with GAAP consistently applied, should be classified on
      the
      Borrowers’ consolidated balance sheet as assets.

     

    “Convertible
      Securities”
of
      a
      Person means any securities (directly or indirectly) convertible into or
      exchangeable for any ownership interests of such Person, including, without
      limitation, all warrants, options and other rights to acquire any ownership
      interests of such Person.

     

    “Dividend”
means
      any distribution by a Person with respect to its ownership interests whether
      in
      cash, securities (including Capital Stock) or other property, including, without
      limitation, distributions upon any liquidation, dissolution or winding up of
      such Person.

     

    “Environmental
      and Safety Requirements”
means
      all federal, state, local and foreign statutes, regulations, ordinances and
      similar provisions having the force or effect of law, all judicial and
      administrative orders and determinations, all contractual obligations and all
      common law, in each case concerning public health and safety, worker health
      and
      safety and pollution or protection of the environment (including, without
      limitation, all those relating to the presence, use, production, generation,
      handling, transportation, treatment, storage, disposal, distribution, labeling,
      testing, processing, discharge, release, threatened release, control or cleanup
      of any hazardous or otherwise regulated materials, substances or wastes,
      chemical substances or mixtures, pesticides, pollutants, contaminants, toxic
      chemicals, petroleum products or byproducts, asbestos, polychlorinated
      biphenyls, noise or radiation), each as amended and as now or hereafter in
      effect.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    “Equity
      Purchase”
means
      any redemption, acquisition, purchase or other retirement of any ownership
      interests of any Borrower or any of its Subsidiaries, other than upon any
      conversion thereof into or exchange thereof for other units of such Borrower’s
      or any of its Subsidiaries’ ownership interests.

     

    “Federal
      Bankruptcy Code”
means
      Title 11 of the United States Code, as amended.

     

    “GAAP”
means
      accounting principles generally accepted in the United States of America as
      promulgated by the Financial Accounting Standards Board and/or any other
      governing body or boards having jurisdiction, authority or responsibility for
      promulgating accounting standards, as in effect from time to time (subject
      to
      the provisions of Section 1.3
      hereof).

     

    “Governing
      Documents”
of
      a
      Person means such Person’s Charter and Organizational Documents.

     

    “Guarantee”
means
      any guarantee of the payment or performance of any Indebtedness or other
      obligation and any other arrangement whereby credit is extended (or continued)
      to one obligor on the basis of any promise of another Person, whether that
      promise is expressed in terms of an obligation to: (i) pay the Indebtedness
      or other liabilities of such obligor; (ii) purchase an obligation owed by
      such obligor; (iii) purchase goods and services from such obligor pursuant
      to a take-or-pay contract; (iv) maintain the capital, working capital,
      solvency or general financial condition of such obligor; or (v) otherwise
      assure any creditor of such obligor against loss (including by way of an
      agreement to repurchase or reimburse), whether or not any such arrangement
      is
      listed on the balance sheet of such other Person or referred to in a footnote
      thereto, but shall not include endorsements of items for collection in the
      ordinary course of business, consistent with past practice. The amount of any
      Guarantee shall be equal to the amount of the obligation so guaranteed or
      otherwise supported, or, if not a fixed or determined amount, the maximum amount
      guaranteed or supported.

     

    “Hedging
      Agreement”
means
      any interest rate, currency or commodity swap agreement, cap agreement or collar
      agreement, and any other agreement or arrangement designed to protect a Person
      against fluctuations in interest rates, currency exchange rates or commodity
      prices.

     

    “Hedging
      Obligation”
means,
      with respect to any Person, any liability of such Person under any Hedging
      Agreement.

    

    “Indebtedness”
means
      at a particular time, without duplication: (i) any indebtedness for
      borrowed money or issued in substitution for or exchange of indebtedness for
      borrowed money; (ii) any indebtedness evidenced by any note, bond,
      debenture or other debt instrument; (iii) any indebtedness for the deferred
      purchase price of property or services with respect to which a Person is liable,
      contingently or otherwise, as obligor or otherwise (other than trade payables
      and other current liabilities incurred in the ordinary course of business,
      consistent with past practice which are not more than 90 days past due unless
      the same are being contested in good faith by appropriate proceedings and with
      respect to which a Person has set aside adequate reserves therefor in accordance
      with GAAP consistently applied); (iv) any commitment by which a Person
      assures a creditor against loss (including, without limitation, contingent
      reimbursement obligations with respect to letters of credit); (v) any
      obligations for which a Person is obligated pursuant to a Guarantee;
      (vi) any obligations under Capitalized Leases with respect to which a
      Person is liable, contingently or otherwise, as obligor, guarantor or otherwise,
      or with respect to which obligations a Person assures a creditor against loss;
      (vii) any indebtedness secured by a Lien on a Person’s assets;
      (viii) any Hedging Obligation of a Person; (ix) all indebtedness of
      any partnership of which such Person is a general partner or in which such
      Person may incur liability as if such Person was a general

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    partner;
      and (x) all indebtedness of a Person for which such Person may become
      liable as a fiduciary or otherwise.

    

    “Intellectual
      Property Rights”
means
      any United States or foreign trademarks and trade names, service marks, Internet
      domain names, copyrights, inventions, patents, trade secrets, trade dress,
      mask
      work, know-how, concepts, ideas, proprietary processes, formulae, customer
      information including lists or other compilations thereof, confidential
      information, rights to use computer software, information systems, databases,
      technology and all other intellectual property rights, in any form, and any
      applications or registrations relating to any of the foregoing and the goodwill
      relating to any of the foregoing.

    

    “Investment”
as
      applied to any Person means: (i) any direct or indirect purchase or other
      acquisition by such Person of any notes, obligations, instruments, ownership
      interests and other securities of any other Person; and (ii) any capital
      contribution by such Person to any other Person.

    

    “Investment
      Documents”
means
      this Agreement, the agreements and instruments evidencing the Securities, the
      Security Documents, the Subordination Agreement, and each of the other
      agreements, documents and instruments expressly contemplated hereby and
      thereby.

    

    “knowledge”
or
      “aware”
      regarding a Person means and includes: (i) the actual knowledge or
      awareness of such Person and its Subsidiaries (which shall include the actual
      knowledge and awareness of the officers, directors and key employees of such
      Person and its Subsidiaries and the general managers of each facility of such
      Person and its Subsidiaries); and (ii) the knowledge or awareness which a
      prudent business person would have obtained in the conduct of his business
      after
      making reasonable inquiry and reasonable diligence with respect to the
      particular matter in question. In particular, and not in limitation of the
      foregoing, the knowledge or awareness of any Borrower shall be imputed to each
      other Security Party and its Subsidiaries.

     

    “Liens”
means
      any mortgage, pledge, security interest, encumbrance, lien, charge or other
      restriction of any kind whatsoever (including any conditional sale or other
      title retention agreement or lease in the nature thereof), any sale of
      receivables with recourse against any Security Party or Subsidiary or Affiliate
      of such Security Party, any filing or agreement to file a financing statement
      as
      debtor under the Uniform Commercial Code or any similar statute other than
      to
      reflect ownership by a third party of property leased to any Security Party
      or
      any of its Subsidiaries under a lease which is not in the nature of a
      conditional sale or title retention agreement.

     

    “material”
means
      any matter that, in the aggregate with all other matters, has resulted or might
      result in costs, liabilities, expenses, damages or prospects of or to, or claims
      by or against any Borrower or one of its Subsidiaries involving $10,000 or
      more.

     

    “Material
      Adverse Effect”
means
      any matter or matters which would, alone or in the aggregate, have a materially
      adverse effect on: (i) the operating results, prospects, assets, liabilities,
      operations, condition (financial or otherwise) or business of the Security
      Parties and their Subsidiaries taken as a whole; (ii) the ability of each of
      the
      Borrowers to repay the Notes; or (iii) the ability of each Security Party to
      perform any of its obligations under the Securities or any of the Investment
      Documents.

     

    “Officer’s
      Certificate”
means
      a
      certificate signed by the president, chief financial officer or vice president
      of each Security Party (or any of them) on behalf of each such Security Party,
      stating that: (i) the officer signing such certificate has made or has
      caused to be made such investigations as are necessary in order to permit him
      to
      verify the accuracy of the information set forth in such certificate; and
      (ii) such certificate does not misstate any material fact and does not omit
      to state any fact necessary to make the certificate not misleading.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    “Operating
      Lease”
means
      for any Person any lease of property which would not be classified as a
      Capitalized Lease under GAAP consistently applied, other than a lease under
      which such Person is the lessor.

     

    “Permitted
      Indebtedness”
      means:

     

    (i)
      the
      Senior Debt;

     

    (ii)
      any
      Indebtedness incurred pursuant to the terms of the Investment
      Documents;

     

    (iii)
      Indebtedness
      secured by Liens permitted by clause (iii) of the definition of Permitted Liens,
      and extensions, renewals and refinancings thereof, provided,
      that
      the aggregate amount of all such Indebtedness at any time outstanding shall
      not
      exceed $50,000 in the aggregate for all Security Parties;

     

    (iv)
      intercompany
      Indebtedness among the Borrowers; 

     

    (v)
Hedging
      Obligations incurred for bona fide hedging purposes and not for
      speculation;
      and

     

    (vi)
      any
      Indebtedness approved by the Board which does not, or upon issuance would not,
      cause an Event of Default or a Potential Event of Default.

    

    “Permitted
      Liens”
      means:

     

    (i)
Liens
      for
      taxes or other governmental charges not yet due and payable or which are being
      contested in good faith by appropriate proceedings and for which adequate
      reserves have been established in accordance with GAAP consistently
      applied;

     

    (ii)
      Liens
      arising in the ordinary course of business, consistent with past practice (such
      as (a) Liens of carriers, warehousemen, mechanics and materialmen and other
      similar Liens imposed by law and (b) Liens incurred in connection with worker’s
      compensation, unemployment compensation and other types of social security
      or in
      connection with surety bonds, bids, performance bonds and similar obligations)
      for sums not overdue or being contested in good faith by appropriate proceedings
      and not involving any deposits or advances or borrowed money or the deferred
      purchase price of property or services and, in each case, for which it maintains
      adequate reserves;

     

    (iii)
      subject
      to the limitations set forth in clause (iii) of the definition of Permitted
      Indebtedness (a) Liens arising in connection with Capitalized Lease
      Obligations (and attaching only to the property being leased), (b) Liens
      existing on property at the time of the acquisition thereof by any Security
      Party (and not created in contemplation of such acquisition) and (c) Liens
      that
      constitute purchase money security interests on any property securing
      Indebtedness incurred for the purpose of financing all or any part of the cost
      of acquiring such property, provided
      that any
      such Lien attaches to such property within 60 days of the acquisition thereof
      and attaches solely to the property so acquired;

     

    (iv)
      attachments,
      appeal bonds, judgments and other similar Liens, for sums not exceeding $10,000
      in the aggregate for all Borrowers and their Subsidiaries, arising in connection
      with court proceedings, provided
      the
      execution or other enforcement of such Liens is

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    effectively
      stayed and the claims secured thereby are being actively contested in good
      faith
      and by appropriate proceedings;

     

    (v)
easements,
      rights-of-way, restrictions, minor defects or irregularities in title and other
      similar Liens not interfering in any material respect with the ordinary conduct
      of the business of each Borrower and its Subsidiaries consistent with past
      practice;

     

    (vi)
      Liens
      securing the Senior Debt; 

     

    (vii)
      Liens
      securing the Notes; and

     

    (viii)
      Liens
      which are described on the Liens
      Schedule.

     

    “Person”
means
      an individual, a partnership, a corporation, a limited liability company, an
      association, a joint stock company, a trust, a joint venture, an unincorporated
      organization, a governmental entity or any department, agency or political
      subdivision thereof and any other entity.

     

    “Potential
      Event of Default”
means
      any event or occurrence which with the passage of time or the giving of notice
      or both would constitute an Event of Default.

     

    “Regulatory
      Problem”
means
      any transaction, circumstance or situation whereby: (i) a Person and such
      Person’s Affiliates would own, control or have power over a quantity of
      securities of any kind issued by any Borrower or any other entity greater than
      is permitted under any requirement of any governmental authority; or (ii) it
      has
      been asserted by any governmental regulatory agency, or such Person believes,
      that such Person and its Affiliates are not entitled to hold, or exercise any
      significant right under or with respect to, the Securities held by such
      Person.

     

    “Restricted
      Securities”
means:
      (i) the Securities issued hereunder; and (ii) any securities issued
      with respect to the securities referred to in clause (i) above by way of a
      Dividend or split or in connection with a combination of Capital Stock,
      recapitalization, merger, consolidation or other reorganization. As to any
      particular Restricted Securities, such securities shall cease to be Restricted
      Securities when they have (a) been effectively registered, under the
      Securities Act and disposed of in accordance with the registration statement
      covering them, (b) become eligible for sale pursuant to Rule 144(k) (or any
      similar provision then in force) under the Securities Act or (c) been otherwise
      transferred and new certificates for them not bearing the Securities Act legend
      set forth in Section 8.3
      have
      been delivered by SBON in accordance with Section 5.4.
      Whenever any particular securities cease to be Restricted Securities, the holder
      thereof shall be entitled to receive from SBON, without expense, new securities
      of like tenor not bearing a Securities Act legend of the character set forth
      in
Section
      8.3.

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended, or any similar federal law then in
      force.

     

    “Securities
      and Exchange Commission”
      includes any governmental body or agency succeeding to the functions
      thereof.

     

    “Securities
      Exchange Act”
means
      the Securities Exchange Act of 1934, as amended, or any similar federal law
      then
      in force.

     

    “Security
      Party”
means
      any Borrower and any Person who makes a Guarantee of any Indebtedness evidenced
      by any of the Investment Documents.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    “Senior
      Debt”
means
      all Indebtedness of Borrowers outstanding under (i) that certain Revolving
      Credit Note dated as of April 2, 2007 in the principal amount of up to
      $1,500,000.00 executed by Borrowers in favor of Southwest Bank, and (ii) that
      certain Promissory Note dated as of April 2, 2007, in the original principal
      amount of $1,125,000.00 executed by the Borrowers in favor of Southwest Bank
      of
      St. Louis.

     

    “Subordinated
      Debt”
means
      that portion of the Indebtedness of the Borrowers which is subordinated to
      the
      Notes in a manner satisfactory to the holders of the Notes, including but not
      limited to, right and time of payment of principal and interest, exercise of
      remedies, limitation on liens and collateral and such other matters as may
      be
      required by the holders of the Notes. 

     

    “Subsidiary”
means,
      with respect to any Person, any corporation, limited liability company,
      partnership, association or other business entity of which: (i) if a
      corporation, a majority of the total voting power of shares of stock entitled
      (without regard to the occurrence of any contingency) to vote in the election
      of
      directors, managers or trustees thereof is at the time owned or controlled,
      directly or indirectly, by that Person or one or more of the other Subsidiaries
      of that Person or a combination thereof; or (ii) if a limited liability company,
      partnership, association or other business entity, a majority of the partnership
      or other similar ownership interest thereof is at the time owned or controlled,
      directly or indirectly, by any Person or one or more Subsidiaries of that Person
      or a combination thereof. For purposes hereof, a Person or Persons shall be
      deemed to have a majority ownership interest in a limited liability company,
      partnership, association or other business entity if such Person or Persons
      shall be allocated a majority of limited liability company, partnership,
      association or other business entity gains or losses or shall be or control
      (or
      have the power to be or control) a board of managers or similar governing body
      of such limited liability company, partnership, association or other business
      entity.

     

    “Tax”
or
      “Taxes”
means
      any federal, state, county, local, foreign or other income, gross receipts,
      ad
      valorem, franchise, profits, sales or use, transfer, registration, excise,
      utility, environmental, communications, real or personal property, capital
      stock, license, payroll, wage or other withholding, employment, social security,
      severance, stamp, occupation, alternative or add-on minimum, estimated and
      other
      taxes, fees, levies or assessments of any kind whatsoever (including
      deficiencies, penalties, additions, or interest attributable thereto) whether
      disputed or not.

     

    “Tax
      Return”
means
      any return, information report or filing with respect to Taxes, including any
      schedules attached thereto and including any amendment thereof.

     

    “Wholly-Owned
      Subsidiary”
means,
      with respect to any Person, a Subsidiary of which all of the outstanding capital
      stock or other ownership interests are owned by such Person or another
      Wholly-Owned Subsidiary of such Person.

     

    
      
        1.2 
          Other
          Defined Terms. The following terms are defined in this Agreement in the
          Section set forth below:

         

      

    

    
      	
              Term

            	
              Section

            
	 	 
	
              Agreement

            	
              Preamble

            
	
              Borrower

            	
              Preamble

            
	
              Business
                Day

            	
              1.1

            
	
              Charter

            	
              3.2

            
	
              Closing

            	
              2.3

            
	
              Event
                of Default

            	
              7.1

            
	
              Indemnitees

            	
              8.16

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              Liabilities

            	
              8.16

            
	
              Material
                Accounting Changes

            	
              1.3

            
	
              Material
                Indebtedness

            	
              7.1

            
	
              Notes

            	
              2.1

            
	
              Organizational
                Documents

            	
              3.3

            
	
              Purchaser

            	
              Preamble

            
	
              SBON

            	
              Preamble

            
	
              Securities

            	
              2.1

            
	
              Security
                Documents

            	
              3.5

            
	
              Security
                Party Obligations

            	
              8.21

            
	
              Shepley

            	
              Preamble

            
	
              SLG

            	
              Preamble

            
	
              Subordination
                Agreement

            	
              3.10

            
	
              Tegeler

            	
              Preamble

            
	
              Warrants

            	
              2.1

            
	
              Warrant
                Shares

            	
              2.1

            

    

    

    1.3 
      Accounting
      Principles.
      The
      classification, character and amount of all assets, liabilities, capital
      accounts and reserves and of all items of income and expense to be determined,
      and any consolidation or other accounting computation to be made, and the
      interpretation of any definition containing any financial term, pursuant to
      this
      Agreement shall be determined and made in accordance with GAAP consistently
      applied; provided
      that if
      any changes in GAAP are hereafter required or permitted and are adopted by
      any
      Borrower with the agreement of its independent certified public accountants
      and
      such changes result in a material change in the method of calculation of any
      of
      the financial covenants, restrictions or standards herein or in the related
      definitions or terms used therein (“Material
      Accounting Changes”),
      the
      parties hereto agree to enter into negotiations, in good faith, in order to
      amend such provisions in a credit neutral manner so as to reflect equitably
      such
      changes with the desired result that the criteria for evaluating a Borrower’s
      financial condition shall be the same after such changes as if such changes
      had
      not been made; provided,
      however, that no Material Accounting Change shall be given effect in such
      calculations until such provisions are amended in a manner reasonably
      satisfactory to the holders of not less than 100% of the outstanding aggregate
      principal amount of the Notes. If such amendment is entered into, all references
      in this Agreement to GAAP shall mean GAAP as of the date of such amendment
      together with any changes in GAAP after the date hereof which are not Material
      Accounting Changes.

     

    1.4 
      Other
      Interpretive Matters.
      In each
      of the Investment Documents, unless a clear contrary intention appears: (i)
      the
      singular number includes the plural number and vice versa; (ii) reference to
      any
      Person includes such Person’s successors and assigns but, if applicable, only if
      such successors and assigns are permitted by such Investment Document, and
      reference to a Person in a particular capacity excludes such Person in any
      other
      capacity or individually; (iii) reference to any gender includes each other
      gender; (iv) reference to any agreement (including this Agreement and the
      Schedules and Exhibits hereto), document or instrument means such agreement,
      document or instrument as amended or modified and in effect from time to time
      in
      accordance with the terms thereof and, if applicable, the terms hereof (and
      without giving effect to any amendment or modification that would not be
      permitted in accordance with the terms hereof); (v) reference to any applicable
      law, statute, rule or regulation means such applicable law, statute, rule or
      regulation as amended, modified, codified or reenacted, in whole or in part,
      and
      in effect from time to time, including rules and regulations promulgated
      thereunder and reference to any particular provision of any applicable law,
      statute, rule or regulation shall be interpreted to include any revision of
      or
      successor to that provision regardless of how numbered or classified; (vi)
      reference to any Article, Section, Schedule or Exhibit means such Article or
      Section hereof or such Schedule or Exhibit hereto; (vii) “hereunder,”
“hereof,” “hereto” and words of

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    similar
      import shall be deemed references to this Agreement as a whole and not to any
      particular Section or other provision hereof; (viii) “including”
(and
      with correlative meaning “include”) means including without limiting the
      generality of any description preceding such term; (ix) relative to the
      determining of any period of time, “from” means “from and including” and “to”
and “through” mean “to and including”; (x) “or”, “either” and “any” are not
      exclusive; (xi) references to any Subsidiary of a Person shall be given effect
      only at such times as such Person has one or more Subsidiaries; and (xii)
      references to “as of the Closing” means as of the Closing.

     

    Section
      2. Authorization
      and Closing.

     

    
      
        2.1 
Authorization
          of the Securities. The
          Borrowers shall authorize the issuance and sale (a) to the Purchasers of
          their
          10% Subordinated Secured Notes in an aggregate principal amount of $200,000.00
          and containing the terms and conditions and in the form set forth in Exhibit
          A
          attached
          hereto (these notes and any notes issued by any Person in respect of these
          notes
          are collectively referred to as, the “Notes”)
          and
          (b) to the Purchasers Warrants to purchase 200,000 shares of Common Stock
          (the “Warrant
          Shares”)
          and
          containing the terms and conditions and in the form set forth in Exhibit
          B
          attached
          hereto (the “Warrants”).
          The
          Notes and the Warrants are sometimes collectively referred to herein as
          the
“Securities.”

      

       

      
        
          2.2 
Purchase
            and Sale of the Securities. At the
            Closing, the Borrowers shall sell to each Purchaser and, subject to the
            terms
            and conditions set forth herein, (i) each Purchaser shall purchase from
            the
            Borrowers a Note in the aggregate principal amount set forth opposite
            such
            Purchaser’s name on the Schedule of Purchasers attached hereto at a price
            equal to the price set forth opposite such Purchaser’s name on the Schedule
            of Purchasers; and (ii) each Purchaser shall purchase the number of
            Warrant Shares set forth opposite such Purchaser’s name on the Schedule of
            Purchasers at a price equal to the price set forth opposite such Purchaser’s
            name on the Schedule of Purchasers. The Notes and the Warrants purchased
            by the Purchasers constitute an investment unit for purposes of Section
            1273(c)(2) of the Code. Except as otherwise required by law, each Purchaser
            and
            the Borrowers hereby agree to report the purchase of the Notes and the
            Warrants
            for purposes of Treasury Regulation section 1.1273-2(h) in a manner consistent
            with the allocation of consideration set forth on the Schedule of
            Purchasers and to take no position contrary thereto or consistent
            therewith.

        

      

       

      
        2.3 
The
          Closing. The closing of the purchase
          and sale of the Securities (the “Closing”)
          shall
          take place at the offices of Thompson Coburn LLP, at 10:00 a.m. on March
          21,
          2007, or at such other place or on such other date as may be mutually agreeable
          to the Borrowers and each Purchaser. At the Closing, the Borrowers shall
          deliver
          to each Purchaser instruments evidencing the Securities to be purchased
          by each
          Purchaser at the Closing, issued in the name of such Purchaser or its nominee,
          upon payment of the purchase price thereof by check payable to the Borrowers,
          in
          the aggregate amount set forth opposite such Purchaser’s name on the
Schedule
          of Purchasers
          attached
          hereto.

      

       

      Section
        3. Conditions
        of each Purchaser’s Obligation at the Closing. The
        obligation of each Purchaser to purchase and pay for the Securities at the
        Closing is subject to the fulfillment as of the Closing of the following
        conditions to each Purchaser’s satisfaction in its sole discretion:

      

      3.1 
Representations,
        Warranties and Covenants; No Event of Default.
        The
        representations and warranties contained in Section
        6
        hereof
        shall be true, complete and correct at and as of the Closing (both immediately
        prior to and immediately after giving effect to the transactions contemplated
        by
        the Investment Documents) as though then made and each Security Party shall
        have
        performed all of the covenants required to be performed by it under the
        Investment Documents that are to be complied with or performed by such Security
        Party on or prior to the Closing, and there shall not exist any Event of
        Default
        or Potential Event of Default.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      3.2 
Charter.
        Each
        Security Party’s charter document(s) (each, a “Charter”)
        shall
        be in form and substance satisfactory to each Purchaser, shall be in full
        force
        and effect under the laws of each such Security Party’s jurisdiction of
        incorporation, formation or organization (as applicable) as of the Closing
        and
        shall not have been amended or modified.

       

      3.3 
Organizational
        Documents.
        Each
        Security Party’s bylaws, operating agreement, partnership agreement, limited
        partnership agreement or similar documents (as applicable) (“Organizational
        Documents”)
        shall
        each be in form and substance satisfactory to each Purchaser, shall each
        be in
        full force and effect as of the Closing and shall not have been amended or
        modified.

       

      3.4 
Security
        Documents.
        The
        Borrowers shall have entered into security agreements and shall have executed
        and delivered all other documents, financing statements and instruments
        necessary to grant to the Purchasers of the Notes and any future holders
        of the
        Notes a valid and perfected security interest in the Collateral (the
“Security
        Documents”).

       

      3.5 
Sale
        of Securities to the Purchaser.
        The
        Borrowers shall have sold to the Purchasers all of the Securities to be
        purchased hereunder at the Closing.

       

      3.6 
Securities
        Law Compliance.
        The
        Borrowers shall have made all filings under all applicable federal and state
        securities laws necessary to consummate the issuance of the Securities pursuant
        to this Agreement.

       

      3.7 
Subordination
        Agreement.
        The
        Borrowers, the holder(s) of the Senior Debt and Purchasers shall have entered
        into one or more intercreditor or subordination agreements in form and substance
        satisfactory to Purchasers (collectively, the “Subordination
        Agreement”),
        and
        the Subordination Agreement shall be in full force and effect as of the
        Closing.

       

      3.8 
Proceedings.
        All
        corporate and other proceedings taken or required to be taken by each Security
        Party in connection with the transactions contemplated hereby to be consummated
        at or prior to the Closing and all documents incident thereto shall be
        reasonably satisfactory in form and substance to the Purchasers and their
        special counsel.

       

      3.9 
Closing
        Documents.
        Each
        Security Party, as applicable, shall have delivered to the Purchasers all
        of the
        following documents, as applicable:

       

      (i)
the
        Notes
        in the aggregate principal amount of $200,000, duly completed and executed
        by
        the Borrowers;

       

      (ii)
        the
        Warrants;

       

      (iii)
        a
        certified copy of the resolutions duly adopted by the boards of directors
        of
        each of the Borrowers authorizing the execution, delivery and performance
        of
        each of the Investment Documents to which it is a party, the issuance and
        sale
        of the Securities, and the consummation of all other transactions contemplated
        by the Investment Documents;
        and

       

      (iv)
        such
        other documents relating to the transactions contemplated by the Investment
        Documents as the Purchasers or their counsel may reasonably
        request.

       

      3.10 
Equity
        Investment.
        Each of
        the Purchasers shall have purchased at the Closing the Warrants set forth
        opposite such Person’s name on the Schedule
        of Purchasers
        at a
        price equal to the price set forth opposite such Person’s name on the
Schedule
        of Purchasers.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      3.11 
Waiver.
        Any
        condition specified in this Section may be waived if consented to by each
        Purchaser; provided that no such waiver shall be effective against any Purchaser
        unless it is set forth in a writing executed by such Purchaser.

       

      Section
        4. Covenants

       

      4.1 Affirmative
        Covenants.
        So long
        as any of the Securities or any notes issued in exchange for any Securities
        remain outstanding and prior to the indefeasible payment in full of all amounts
        due and owing under the Notes or any other notes issued in exchange for any
        Securities, each Borrower shall, and shall cause each other Security Party
        and
        each of their Subsidiaries to:

       

      (i)
at
        all
        times cause to be done all things necessary to maintain, preserve and renew
        its
        company existence, rights, franchises, privileges and qualifications and
        all
        material licenses, authorizations and permits necessary to the conduct of
        its
        businesses, the failure to obtain which would reasonably be expected to have
        a
        Material Adverse Effect;

       

      (ii)
        maintain
        and keep its material properties in good repair, working order and condition
        (ordinary wear and tear excepted), and from time to time make all necessary
        or
        desirable repairs, renewals and replacements, so that its businesses may
        be
        properly and advantageously conducted in all material respects at all
        times;

       

      (iii)
        pay
        and
        discharge when payable all Taxes, assessments and governmental charges imposed
        upon its properties or upon it or its income or profits (in each case before
        the
        same becomes delinquent and before penalties accrue thereon) and all claims
        for
        labor, materials or supplies which if unpaid would by law, statute, rule
        or
        regulation become a Lien upon any of its property, unless and to the extent
        that
        the same are being contested in good faith, diligently and by appropriate
        proceedings and adequate reserves (as determined in accordance with GAAP
        consistently applied) have been established on its books with respect thereto
        and such contest operates to suspend collections of the same;

       

      (iv)
        comply
        with all other material obligations which it incurs pursuant to any contract
        or
        agreement, whether oral or written, express or implied, as such obligations
        become due, unless and to the extent that the same are being contested in
        good
        faith, diligently and by appropriate proceedings and adequate reserves (as
        determined in accordance with GAAP consistently applied) have been established
        on its books with respect thereto;

       

      (v)
comply
        with all applicable laws, rules and regulations (including Environmental
        and
        Safety Requirements), the violation of which would reasonably be expected
        to
        have a Material Adverse Effect;

       

      (vi)
        comply
        with all material Environmental and Safety Requirements and all material
        permits, licenses or other authorizations issued thereunder, respond immediately
        to any release or threatened release of any hazardous material, substance
        or
        waste in a manner which complies with all Environmental and Safety Requirements
        and reasonably mitigates any risk to human health or the environment and
        provide
        such documents or information, or conduct at its own cost such studies or
        assessments, relating to matters arising under the Environmental and Safety
        Requirements as any Purchaser may reasonably request;

       

      (vii)
        apply
        for
        and continue in force with good and responsible insurance companies adequate
        insurance covering risks of such types and covering casualties, risks and
        contingencies of such types and in such amounts as are customary for prudent
        companies of

       

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      similar
        size engaged in similar lines of business (but in no event less than such
        amounts that were maintained as of the Closing);
        and

       

      (viii)
        maintain
        proper books of record and account which present fairly in all material respects
        its financial condition and results of operations and make provisions on
        its
        financial statements for all such proper reserves as in each case are required
        in accordance with GAAP consistently applied.

       

      4.2 
Note
        Negative Covenants.
        So long
        as any of the Notes or any notes issued in exchange for any Securities remain
        outstanding and prior to the indefeasible payment in full of all amounts
        due and
        owing thereunder, no Borrower shall, and each Borrower shall prohibit each
        other
        Security Party and their Subsidiaries from doing any of the following, without
        the prior written consent of the holders of not less than 100% of the
        outstanding aggregate principal amount of the Notes or, if no Notes are then
        outstanding, the holders of not less than a majority of the outstanding
        Warrants:

       

      (i)
directly
        or indirectly declare, pay or make any Dividends, except for (a) Dividends
        payable in Common Stock of SBON issued upon the outstanding Common Stock
        of
        SBON, and (b) Dividends by Wholly-Owned Subsidiaries of SBON paid or made,
        directly or indirectly, to SBON;

       

      (ii)
        directly
        or indirectly make any Equity Purchase or directly or indirectly redeem,
        purchase or make, or permit any of its Subsidiaries to redeem, purchase or
        make
        any payments with respect to any equity appreciation rights, phantom equity
        plans, profits interest plans or similar rights or plans;

       

      (iii)
        authorize,
        issue or enter into any agreement providing for the issuance (contingent
        or
        otherwise) of any notes or debt securities containing equity features or
        profit
        participation features (including Convertible Securities in the form of notes
        or
        debt securities);

       

      (iv)
        make
        any
        loans or advances to, Guarantees for the benefit of, or Investments in, any
        Person except for (a) reasonable advances to employees in the ordinary
        course of business, consistent with past practice, (b) acquisitions permitted
        pursuant to subsection
        (viii),
        (c) Investments having a stated maturity no greater than one year from the
        date such Investment is made in (1) obligations of the United States government
        or any agency thereof or obligations guaranteed by the United States government,
        (2) certificates of deposit of commercial banks having combined capital and
        surplus of at least $50 million or (3) commercial paper with a rating of
        at
        least “Prime-1” by Moody’s Investors Service, Inc., (d) intercompany loans or
        advances to or Guarantees by any Borrower for the benefit of any other Borrower
        in the ordinary course of business, consistent with past practice,
        (e) securities of account debtors received pursuant to any plan of
        reorganization or similar arrangement upon the bankruptcy or insolvency of
        such
        account debtors, (f) contributions by any Borrower to the capital of any
        other
        Borrower (other than SBON), and (g) bank deposits in the ordinary course
        of
        business, consistent with past practice;

       

      (v)
except
        as
        permitted by subsection
        (viii),
        merge
        or consolidate with any Person (other than a merger or consolidation between
        or
        among Wholly-Owned Subsidiaries or a merger or consolidation of a Wholly-Owned
        Subsidiary into SBON) or convert to any other type of business entity or
        cause
        the conversion of any of its equity securities;

       

      (vi)
        directly
        or indirectly in one or more related transactions, sell, lease, exchange
        or
        otherwise dispose of more than 5% of the Consolidated Total Assets in any
        12-

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      month
        period (other than sales of inventory in the ordinary course of business,
        consistent with past practice) or sell, exchange or permanently dispose of
        any
        of its material Intellectual Property Rights;

       

      (vii)
        liquidate,
        dissolve or effect a recapitalization or reorganization in any form of
        transaction or otherwise alter its legal status other than the merger,
        consolidation, acquisition, sale, transfer, conveyance, lease or assignment
        of
        or by any Borrower with any other Borrower;

       

      (viii)
        acquire
        any interest in any company or business (whether by a purchase of assets,
        purchase of Capital Stock, merger or otherwise), or enter into any joint
        venture, involving an aggregate consideration (including the assumption of
        liabilities whether direct or indirect) exceeding $50,000 in any 12-month
        period;

       

      (ix)
        enter
        into, become subject to, amend, modify or waive any agreement or instrument
        which by its terms would (under any circumstances) restrict (a) the right
        of any of its Subsidiaries to make loans or advances or pay dividends or
        make
        distributions to, transfer property to, or repay any Indebtedness owed to,
        the
        Borrowers or another Subsidiary of the Borrowers, or (b) any Security Party’s
        right to perform any of the provisions of any of the Investment Documents,
        the
        Securities or its Governing Documents (including provisions relating to the
        payment of principal and interest on the Notes or any other notes issued
        in
        exchange for the Securities), except in any such case for entering into the
        Subordination Agreement and amending, modifying or supplementing such agreement
        in accordance with its terms;

       

      (x)
establish
        or acquire (a) any Subsidiaries other than the establishment of any Wholly-Owned
        Subsidiaries of SBON so long as the provisions of Section
        4.12
        are
        satisfied or (b) any Subsidiaries organized outside of the United States
        and its
        territorial possessions;

       

      (xi)
        create,
        incur, assume or suffer to exist any Indebtedness other than Permitted
        Indebtedness or any Lien other than Permitted Liens;

       

      (xii)
        change
        its fiscal year;

       

      (xiii)
        prepay,
        redeem, purchase, defeat or otherwise satisfy in any manner any principal
        or
        interest on any Indebtedness other than Senior Debt and the Indebtedness
        under
        this Agreement, the Notes, and any notes issued in exchange for any
        Securities;

       

      (xiv)
        issue
        or
        sell any Capital Stock of any of its Subsidiaries to any Person other than
        SBON
        or a Wholly-Owned Subsidiary of SBON;

       

      (xv)
        make
        any
        amendment to its Governing Documents, directly or indirectly, whether by
        merger,
        conversion, operation of law or otherwise, or file any resolution of its
        board
        of managers (or similar governing body) with its jurisdiction of incorporation,
        formation or organization (as applicable) containing any provisions, which
        would
        adversely affect or otherwise impair in any respect any rights or remedies
        of
        any Purchaser or the rights or relative priority of the holders of the
        Securities under this Agreement or its Governing Documents;

       

      (xvi)
        amend,
        modify or waive any provision of the Investment Documents, to which it is
        a
        party, or fail to enforce the provisions of the Investment Documents, to
        which
        it is a party, or exercise any of its rights and remedies
        thereunder;

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      (xvii)
        take
        any
        action, or fail to take any action, which would result in the invalidity,
        abandonment, misuse or unenforceability of its Intellectual Property Rights
        or
        which would infringe upon or misappropriate any rights of other
        Persons;

       

      (xviii)
        cancel
        any claim or debt owing to it, except for reasonable consideration or in
        the
        ordinary course of business, consistent with past practice, and except for
        the
        cancellation of debts or claims not to exceed $10,000 in any fiscal year;
        or

       

      (xix)
        enter
        into or be a party to, or permit any of its Subsidiaries to enter into or
        be a
        party to, any contract or agreement for the purchase of materials, supplies
        or
        other property or services if such contract or agreement requires that payment
        be made by a Security Party
        regardless of whether delivery is ever made of such materials, supplies or
        other
        property or services.

       

      4.3 
Compliance
        with Agreements.
        Each
        Security Party shall perform and observe all of its obligations, and shall
        cause
        each of its Subsidiaries to perform and observe all of their respective
        obligations, as applicable: (i) to each holder of the Notes and any other
        notes
        issued in exchange for any Securities and all of its obligations to each
        holder
        of Warrants set forth in the Investment Documents and the Governing Documents;
        and (ii) under each of the Investment Documents.

       

      4.4 Use
        of
        Proceeds.
        No
        Borrower shall use, and each Borrower shall prohibit each other Security
        Party
        and their Subsidiaries from using any proceeds from the sale of the Securities
        hereunder, directly or indirectly, for the purposes of purchasing or carrying
        any “margin securities” within the meaning of Regulation U promulgated by
        the Board of Governors of the Federal Reserve Board or for the purpose of
        arranging for the extension of credit secured, directly or indirectly, in
        whole
        or in part by collateral that includes any “margin securities.”

       

      4.5 
Pro
        Rata Payment.
        Except
        as otherwise expressly provided for in the Notes or any other notes issued
        in
        exchange for any of the Securities, any payments by any Borrower or any
        guarantor to the holders of the Notes or any other notes issued in exchange
        for
        any of the Securities (whether for principal, interest or otherwise) shall
        be
        made pro rata among such holders based upon the aggregate unpaid principal
        amount of all such notes held by each such holder. If any holder of a Note
        or
        any other notes issued in exchange for any of the Securities obtains any
        payment
        (whether voluntary, involuntary, by application of offset or otherwise) of
        principal or interest on any such note in excess of such holder’s pro rata share
        of payments obtained by all holders of all such notes (other than as expressly
        provided in such notes), by acceptance of any such note such holder agrees
        to
        share the excess payment ratably among each of the other holders as provided
        in
        this Section.

       

      4.6 
Current
        Public Information.
        The
        Borrowers shall file use commercially reasonable efforts to all reports required
        to be filed by it under the Securities Act and the Securities Exchange Act
        and
        the rules and regulations adopted by the Securities and Exchange Commission
        thereunder and shall take such further action as any holder or holders of
        Restricted Securities may reasonably request, all to the extent required
        to
        enable such holders to sell Restricted Securities pursuant to Rule 144 adopted
        by the Securities and Exchange Commission under the Securities Act (as such
        rule
        may be amended from time to time) or any similar rule or regulation hereafter
        adopted by the Securities and Exchange Commission. Upon request, the Borrowers
        shall deliver to any holder of Restricted Securities a written statement
        as to
        whether it has complied with such requirements.

       

      4.7 Intellectual
        Property Rights.
        Each
        Borrower shall, and shall cause each other Security Party and their Subsidiaries
        to, possess and maintain all material Intellectual Property Rights necessary
        to
        the conduct of their respective businesses and own all right, title and interest
        in and to, or

      
        
          
          

        

        
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      have
        a
        valid license for, all such Intellectual Property Rights. No Borrower shall
        take
        or fail to take, and each Borrower shall prohibit each other Security Party
        and
        their Subsidiaries from taking or failing to take, any action which would
        result
        in the invalidity, abandonment, misuse or unenforceability of such Intellectual
        Property Rights or which would infringe upon or misappropriate any rights
        of
        other Persons.

       

      4.8 
Additional
        Subsidiaries. With respect to any new
        Subsidiary of a Borrower established after the Closing, such Borrower shall
        promptly cause such new Subsidiary to deliver to the Purchaser the same
        documents required to be delivered by the Security Parties pursuant to Section
        3
        for such new Subsidiary, and if requested by the Purchasers, deliver to the
        Purchasers legal opinions with respect to such new Subsidiary, which opinions
        shall be in form and substance, and from counsel, satisfactory to the
        Purchasers.

       

      4.9 
Further
        Assurances.
        At any
        time and from time to time, upon the request of the Purchasers, each Borrower
        shall, and shall cause each other Security Party and their Subsidiaries to,
        execute, deliver and acknowledge or cause to be executed, delivered and
        acknowledged, such further documents and instruments and do such other acts
        and
        things as so requested in order to fully effect the purposes of this Agreement,
        the other Investment Documents and any other agreements, instruments and
        documents delivered pursuant hereto or in connection with the Securities,
        any
        notes issued in exchange for any Securities. In addition, if requested by
        the
        Purchasers, each Borrower shall, and shall cause each other Security Party
        and
        their Subsidiaries to, obtain and promptly furnish to the Purchasers evidence
        of
        all governmental approvals as may be required to enable such Borrower to
        comply
        with its obligations under the Investment Documents and to continue in business
        as conducted on the date hereof without material interruption or
        interference.

       

      Section
        5. Transfer
        of Notes.

       

      5.1 
General
        Provisions.
        Notes
        are transferable only pursuant to: (i) Rule 144 or Rule 144A promulgated
        under
        the Securities Act (or any similar rule or rules then in force) if such rule
        is
        available; or (ii) otherwise in compliance with applicable securities
        laws.

       

      5.2 
Opinion
        Delivery.
        In
        connection with the transfer of any Note (other than a transfer described
        in
Section
        5.1(i)
        if
        reasonably required by the Borrowers, the holder thereof shall deliver to
        the
        Borrowers an opinion of counsel to the effect that such transfer of the Note
        may
        be effected without registration of such Note under the Securities Act. In
        addition, if the holder of the Note delivers to the Borrowers an opinion
        of such
        counsel that no subsequent transfer of such Note shall require registration
        under the Securities Act, the Borrowers shall deliver a replacement Note
        that
        does not bear clause (a) of the legend set forth in Section
        8.3.
        If the
        Borrowers are not required to deliver a replacement Note not bearing such
        legend, the holder thereof shall not transfer the same until the prospective
        transferee has confirmed to the Borrowers in writing its agreement to be
        bound
        by the conditions contained in this Section
        5.2
        and
Section
        8.3.

       

      5.3 
Information
        Requests.
        Upon
        the request of any Purchaser, each Borrower shall, and shall cause each other
        Security Party and their Subsidiaries to, promptly supply to the Purchaser
        or
        its prospective transferees all information regarding such Security Party
        and
        its Subsidiaries required to be delivered in connection with a transfer
        hereof.

       

      5.4 
Legend
        Removal.
        If any
        Note becomes eligible for sale pursuant to Rule 144(k), the Borrowers shall,
        upon the request of the holder of such Note, remove the legend set forth
        in
Section
        8.3
        from the
        certificates for such Notes.

       

      
        
          
          

        

        
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      Section
        6. Representations
        and Warranties of the
        Borrowers.  As
        a
        material inducement to the Purchasers to enter into this Agreement and purchase
        the Securities hereunder, the each Borrower hereby represents and warrants
        to
        the Purchasers as follows:

       

      6.1 
Organization,
        Corporate Power and Licenses.
        SBON is
        a corporation duly incorporated, validly existing and in good standing under
        the
        laws of the State of Maryland. SLB is a corporation duly incorporated, validly
        existing and in good standing under the laws of the State of Texas. Each
        Borrower possesses all requisite corporate power and authority and all material
        licenses, permits and authorizations necessary to own and operate its
        properties, to carry on its businesses as now conducted and presently proposed
        to be conducted and to carry out the transactions contemplated by the Investment
        Documents. 

       

      6.2 
Authorization;
        No Breach.
        The
        execution, delivery and performance of each of the Investment Documents and
        all
        other agreements and instruments contemplated hereby and thereby to which
        a
        Borrower is a party have been duly authorized by each Borrower. Each of the
        Investment Documents, each Borrower’s Governing Documents and all other
        agreements and instruments contemplated hereby and thereby to which a Borrower
        is a party constitutes a valid and binding obligation of each Borrower,
        enforceable in accordance with its terms. The execution and delivery by the
        Borrowers of each of the Investment Documents and all other agreements and
        instruments contemplated hereby and thereby to which it is a party, the
        offering, sale and issuance of the Securities hereunder, and the fulfillment
        of
        and compliance with the respective terms hereof and thereof by such Security
        Party, do not and shall not: (i) conflict with or result in a breach of the
        terms, conditions or provisions of; (ii) constitute a default under;
        (iii) result in the creation of any Lien upon the Borrowers’ Capital Stock
        or assets pursuant to; (iv) give any third party the right to modify, terminate
        or accelerate any obligation under; (v) result in a violation of; or (vi)
        require any authorization, consent, approval, exemption or other action by
        or
        notice or declaration to, or filing with, any court or administrative or
        governmental body or agency pursuant to, the Governing Documents of the
        Borrowers, or any law, statute, rule or regulation to which the Borrowers
        are
        subject (including any usury laws applicable to the Notes), or any agreement,
        instrument, order, judgment or decree to which the Borrowers are subject.
        

       

      6.3 
Solvency,
        Etc.
        Each
        Borrower is solvent as of the date of this Agreement and shall not become
        insolvent as a result of the consummation of the transactions contemplated
        by
        the Investment Documents. Each Borrower is, and after giving effect to the
        transactions contemplated by the Investment Documents shall be, able to pay
        its
        debts as they become due, and each Borrower’s property now has, and after giving
effect
        to
        the transactions contemplated hereby shall have, a fair salable value greater
        than the amounts required to pay its debts (including a reasonable estimate
        of
        the amount of all contingent liabilities). Each Borrower has adequate capital
        to
        carry on its business, and after giving effect to the transactions contemplated
        by the Investment Documents, each Borrower shall have adequate capital to
        conduct its business. No transfer of property is being made and no obligation
        is
        being incurred in connection with the transactions contemplated by the
        Investment Documents with the intent to hinder, delay or defraud either present
        or future creditors of the Borrowers.

       

      Section
        7. Events
        of Default.

       

      7.1 
Definition.
        An
        Event of Default shall be deemed to have occurred if:

       

      (i)
the
        Borrowers fail to pay when due and payable (whether at maturity or otherwise)
        the full amount of interest (whether in cash or in kind) then accrued on
        any
        Notes or any notes issued in exchange for any Securities, or the full amount
        of
        any principal payment (together with any applicable premium) on any Notes
        or any
        notes issued in exchange for any Securities or any other amounts payable
        under
        the Securities or the Investment Documents and

       

      
        
          
          

        

        
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       such
        amounts remain unpaid for a period of five Business Days after notice to
        Borrowers of such non-payment;

       

      (ii)
        any
        Security Party
        breaches, fails to perform or observe any provision contained in the Investment
        Documents and (1) if such failure has had or could have a Material Adverse
        Effect, such failure continues uncured for 15 days or (2) if such failure
        has
        not had and could not have a Material Adverse Effect, if such failure continues
        uncured for 30 days or the Security Parties are not proceeding diligently
        to
        cure such failure;

       

      (iii)
        any
        representation, warranty or information contained herein or required to be
        furnished to any holder of the Securities pursuant to the Investment Documents,
        or any writing furnished by any Security Party to any holder of the Notes,
        is
        false or misleading in any material respect on the date made, repeated or
        furnished;

       

      (iv)
        any
        Security Party or its Subsidiaries makes an assignment for the benefit of
        creditors or admits in writing its inability to pay its debts generally as
        they
        become due, or an order, judgment, decree or injunction is entered adjudicating
        such Security Party or any of its Subsidiaries bankrupt or insolvent or
        requiring the dissolution or split up of such Security Party or any of its
        Subsidiaries or preventing such Security Party or any of its Subsidiaries
        from
        conducting all or any part of its business; or any order for relief with
        respect
        to any Security Party or its Subsidiaries is entered under the Federal
        Bankruptcy Code; or any Security Party or its Subsidiaries petitions or applies
        to any tribunal for the appointment of a custodian, trustee, receiver or
        liquidator of such Security Party or any of its Subsidiaries, or of any
        substantial part of the assets of such Security Party or any of its
        Subsidiaries, or commences any proceeding (other than a proceeding for the
        voluntary liquidation and dissolution of any of its Subsidiaries) relating
        to
        such Security Party or any of its Subsidiaries under any bankruptcy
        reorganization, arrangement, insolvency, readjustment of debt, dissolution
        or
        liquidation or similar laws of any jurisdiction now or hereafter in effect;
        or
        any such petition or application is filed, or any such proceeding is commenced,
        against such Security Party or any of its Subsidiaries and either (a) such
        Security Party or any such Subsidiary by any act indicates its approval thereof,
        consent thereto
        or acquiescence therein or (b) such petition, application or proceeding is
        not
        dismissed within 60 days;

       

      (v)
        a
        final
        judgment in excess of $100,000 is rendered against any Security Party or
        its
        Subsidiaries and, within 60 days after entry thereof, such judgment is not
        discharged in full or execution thereof stayed pending appeal, or within
        60 days
        after the expiration of any such stay, such judgment is not discharged in
        full;

       

      (vi)
        any
        Security Party’s or its Subsidiaries’ assets are attached, seized, subjected to
        a writ or distress warrant, or are levied upon, or come within the possession
        of
        any receiver, trustee, custodian or assignee for the benefit of creditors
        in
        connection with any obligations or liabilities of the Security Parties and
        their
        Subsidiaries and such attachment, seizure, warrant, levy or possession could
        reasonably be expected to have a Material Adverse Effect;

       

      (vii)
        any
        Security Party or its Subsidiaries defaults in the payment when due, or in
        performance or observance of, any material obligation of, or condition agreed
        to
        by, any Security Party or its Subsidiaries with respect to any material purchase
        or lease of goods or services where such default, singly or in the aggregate
        with all other such defaults, could reasonably be expected to have a Material
        Adverse Effect;

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      (viii)
        (a)
        any
        Security Party or its Subsidiaries defaults (1) in payment when due (after
        taking into account any applicable grace period) of any amounts (whether
        by upon
        scheduled payment, required prepayment, required cash collection, acceleration,
        demand or otherwise) under any indenture, loan agreement, note or other
        instrument under which any evidence of Indebtedness of such Security Party
        or
        its Subsidiaries has been or hereafter may be issued or outstanding (excluding
        any evidence of Indebtedness issued by such Security Party or its Subsidiaries
        in connection with the Senior Debt) (“Material
        Indebtedness”)
        or (2)
        under the terms, covenants or other provisions of any such indenture, loan
        agreement, note or other instrument, if the effect of such default is to
        accelerate or to permit the acceleration of the stated maturity of such Material
        Indebtedness (whether or not actually accelerated) or (in the case of demand
        obligations) results in demand for payment of such Material Indebtedness
        or (b)
        any other event shall occur or conditions shall exist with respect to such
        Material Indebtedness, if the effect of such event or condition is to cause,
        or
        to permit the holders thereof to cause, such Material Indebtedness to become
        due
        and payable prior to its scheduled maturity dates (other than refinancing
        of
        such Material Indebtedness permitted herein);

       

      (ix)
        there
        shall occur an acceleration of any of the Senior Debt following an “Event of
        Default” as defined in the agreements evidencing Senior Debt or any similar
        concept contained therein;

       

      (x)
        any
        of
        the Investment Documents shall cease to be in full force and effect or declared
        to be null and void by a court of competent jurisdiction;

       

      (xi)
        a
        Change
        in Control shall occur;

       

      (xii)
        any
        Borrower or any of its Subsidiaries shall be enjoined, restrained or prevented
        by any court or administrative agency from conducting any material part of
        its
        business;

       

      (xiii) the
        occurrence of any event that could reasonably cause the cessation or substantial
        curtailment of the conduct of business by any Borrower or any of its
        Subsidiaries;
        or

       

      (xiv) the
        loss,
        suspension or revocation of, or failure to renew, any license or permit required
        by any Borrower or any of its Subsidiaries to conduct its business.

       

      The
        foregoing shall constitute “Events of Default” whatever the reason or cause for
        any such Event of Default and whether it is voluntary or involuntary or is
        effected by operation of law or pursuant to any judgment, decree or order
        of any
        court or any order, rule or regulation of any administrative or governmental
        body.

       

      
        7.2 
Consequences
          of Events of Default.

         

      

      (i) If
        any
        Event of Default has occurred, then the interest rate on the Notes and any
        notes
        issued in exchange for any Securities shall increase immediately by an increment
        of three percentage points (or, if less, the highest rate permitted by law).
        If
        any such Event of Default has occurred and continues for a period of 360
        days
        thereafter, then the interest rate on the Notes shall increase by a further
        increment of two percentage points (for a total increase of five percentage
        points) (or, if less, the highest rate permitted by law). Any increase of
        the
        interest rate resulting from the operation of this subparagraph shall terminate
        as of the close of business on the date on which no Events of Default exist
        (subject to subsequent increases pursuant to this subparagraph).

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      (ii) If
        an
        Event of Default of the type described in Section
        7.1(iv)
        has
        occurred, then the aggregate outstanding principal amount of all of the Notes
        and any notes issued in exchange for any Securities (together with all accrued
        interest thereon and all other amounts due and payable with respect thereto)
        shall become immediately due and payable without any action on the part of
        the
        holders thereof, and the Borrowers shall immediately pay to the holders of
        such
        notes all amounts due and payable with respect thereto.

       

      (iii) If
        an
        Event of Default (other than under Section
        7.1(iv))
        has
        occurred and is continuing, then the holder or holders of Notes representing
        not
        less than 100% of the aggregate principal amount of Notes and any notes issued
        in exchange for any Securities then outstanding may declare all or any portion
        of the outstanding principal amount of the Notes and any notes issued in
        exchange for any Securities (together with all accrued interest thereon and
        all
        other amounts due and payable with respect thereto) to be immediately due
        and
        payable and may demand immediate payment of all or any portion of the
        outstanding principal amount of the Notes and any notes issued in exchange
        for
        any Securities (together with all such other amounts then due and payable)
        owned
        by such holder or holders. The Borrowers shall give prompt written notice
        of any
        such demand to the other holders of Notes and any notes issued in exchange
        for
        any Securities, each of which may demand immediate payment of all or any
        portion
        of such holder’s Note and any notes issued in exchange for any Securities. If
        any holder or holders of the Notes and any notes issued in exchange for any
        Securities demand immediate payment of all or any portion of the Notes and
        any
        notes issued in exchange for any Securities, the Borrowers shall immediately
        pay
        to such holder or holders all amounts due and payable with respect
        thereto.

       

      Section
        8. Miscellaneous.

       

      8.1
 Expenses.
        Each
        Borrower shall, and shall cause each other Security Party and their Subsidiaries
        to, pay, and hold the Purchasers harmless against liability for the payment
        of,
        and reimburse on demand as and when incurred from and against the following:
        (i)
        all reasonable costs and expenses incurred in connection with the due diligence
        review of each Security Party and its Subsidiaries, the preparation,
        negotiation, execution and interpretation of the Investment Documents, the
        Securities, and the agreements contemplated hereby and thereby, and the
        consummation of all of the transactions contemplated hereby and thereby
        (including all reasonable fees and expenses of legal counsel, environmental
        consultants and accountants), which costs and expenses shall be payable at
        the
        Closing or, if the Closing does not occur, payable upon demand; (ii) all
        recording and filing fees, stamp and other Taxes which may be payable in
        respect
        of the execution and delivery of the Investment Documents or the issuance,
        delivery or acquisition of any Securities; and (iii) the reasonable fees
        and
        expenses incurred in any filing with any governmental agency with respect
        to its
        investment in any Security Party or in any other filing with any governmental
        agency with respect to any Security Party which mentions such Person. In
        addition, each Borrower shall, and shall cause each other Security Party
        and
        their Subsidiaries to, pay, and hold the Purchasers harmless against liability
        for the payment of, and reimburse on demand as and when incurred from and
        against the following: (i) all fees and expenses incurred with respect to
        any
        amendments or waivers (whether or not the same become effective) under or
        in
        respect of each of the Investment Documents, the Governing Documents of each
        Security Party and the other agreements and instruments contemplated hereby
        and
        thereby (including all reasonable expenses incurred in connection with any
        proposed merger, sale or recapitalization of any Security Party or any of
        its
        Subsidiaries); and (ii) the reasonable fees and expenses incurred with respect
        to the interpretation and enforcement of the rights granted under the Investment
        Documents, the Securities, the Governing Documents of each Security Party
        and
        the agreements or instruments contemplated hereby and thereby (including
        costs
        of collection). If the Security Parties fail to pay when due any amounts
        due
        Purchasers or fail to comply with any of their obligations pursuant to this
        Agreement or any other agreement, document or instrument executed or delivered
        in connection herewith, the Security Parties shall, upon demand, pay to
        Purchasers

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      such
        further amounts as shall be sufficient to cover the cost and expense (including,
        but not limited to attorneys’ fees) incurred in collecting all such amounts due
        or in otherwise enforcing the rights and remedies hereunder. The Security
        Parties also agree to pay to the Purchasers all costs and expenses incurred
        by
        them, including reasonable compensation to their attorneys for all services
        rendered, in connection with the investigation of any Event of Default and
        enforcement of their rights hereunder or under the other Investment
        Documents.

       

      8.2 
Remedies.
        Each
        holder of Securities shall have all rights and remedies set forth in the
        Investment Documents and the Governing Documents of each Security Party and
        all
        rights and remedies which such holders have been granted at any time under
        any
        other agreement or contract and all of the rights which such holders have
        under
        any law, statute, rule or regulation. No remedy hereunder or thereunder
        conferred is intended to be exclusive of any other remedy, and each and every
        such remedy shall be cumulative and shall be in addition to every other remedy
        given hereunder or thereunder or now or hereafter existing at law or in equity
        or by statute or otherwise. Any Person having any rights under any provision
        of
        the Investment Documents shall be entitled to enforce such rights specifically
        (without posting a bond or other security), to recover damages by reason
        of any
        breach of any provision of the Investment Documents and to exercise all other
        rights granted by law, statute, rule or regulation.

       

      8.3 
Purchaser’s
        Investment Representations.
        Each
        Purchaser, severally and not jointly, hereby represents that it is acquiring
        the
        Restricted Securities purchased hereunder or acquired pursuant hereto for
        its
        own account with the present
        intention of holding such securities for purposes of investment, and that
        it has
        no intention of selling such securities in a public distribution in violation
        of
        the federal securities laws or any applicable state securities laws;
provided,
        that
        nothing contained herein shall prevent such Purchaser and subsequent holders
        of
        Restricted Securities from transferring such securities in compliance with
        the
        provisions of Section
        5
        hereof.
        Each certificate or instrument representing Restricted Securities shall be
        imprinted with a legend in substantially the following form:

       

      “THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON MARCH
        21,
        2007, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
        THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT
        TO THE
        CONDITIONS SPECIFIED IN THE NOTE AND WARRANT PURCHASE AGREEMENT, DATED AS
        OF
        MARCH 21, 2007, AND AS AMENDED AND MODIFIED FROM TIME TO TIME, AMONG THE
        BORROWERS; THE INITIAL HOLDER(S) HEREOF AND CERTAIN INVESTORS, WHO FROM TIME
        TO
        TIME BECOME PARTIES THERETO IN ACCORDANCE WITH THE PROVISIONS THEREOF, AND
        THE
        BORROWERS RESERVE THE RIGHT TO REFUSE THE TRANSFER OF SUCH SECURITY UNTIL
        SUCH
        CONDITIONS HAVE BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. UPON WRITTEN
        REQUEST, A COPY OF SUCH CONDITIONS SHALL BE FURNISHED BY THE BORROWERS TO
        THE
        HOLDER HEREOF WITHOUT CHARGE.”

       

      8.4 
Amendments
        and Waivers.
        Except
        as otherwise expressly provided herein, the provisions of this Agreement
        and the
        provisions of the Notes may be amended and each Security Party may take any
        action herein prohibited, or omit to perform any act herein required to be
        performed by it, only if such Security Party has obtained the written consent
        of
        the holders of not less than 100% of the outstanding aggregate principal
        amount
        of the Notes; provided,
        that if
        there are no Notes outstanding, the provisions of this Agreement may be amended
        or waived by the Security Parties and each Security Party may take any action
        herein prohibited, only if such Security Party has obtained the written consent
        of the holders of not less than a majority of the number of outstanding
        Warrants. No other course of dealing between any Security Party and the holder
        of any Security or any delay in exercising any rights hereunder

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      or
        under
        the Notes or the Governing Documents of any Security Party shall operate
        as
        waiver of any rights of any such holders. For purposes of this Agreement,
        the
        Securities held by any Security Party or its Subsidiaries shall not be deemed
        to
        be outstanding. If any Borrower or any other Security Party or any of their
        Subsidiaries pays any consideration to any holder of Securities for such
        holder’s consent to any amendment, modification or waiver hereunder, such party
        shall also pay each other holder granting its consent hereunder equivalent
        consideration computed on a pro rata basis.

       

      8.5 
Survival
        of Agreement.
        All
        covenants, representations and warranties contained in the Investment Documents
        or made in writing by each Security Party in connection herewith or therewith
        shall survive the execution and delivery of the Investment Documents and
        the
        consummation of the transactions contemplated hereby and thereby, regardless
        of
        any investigation made by any Purchaser or on its behalf. In addition, the
        obligations of each Security Party pursuant to Sections
        8.1,
        8.16
        and
8.17
        shall
        survive the repayment of all amounts payable pursuant to this Agreement,
        the
        Notes and the Warrants.

       

      8.6 
No
        Setoffs, Etc.
        All
        payments hereunder and under the Securities and any notes issued in exchange
        for
        any Securities shall be made by each Security Party without setoff, offset,
        deduction or counterclaim, free and clear of all taxes, levies, imports,
        duties,
        fees and charges, and without any withholding, restriction or conditions
        imposed
        by any governmental authority. If any Security Party shall be required by
        any
        law, statute, rule or regulation to deduct, setoff or withhold any amount
        from
        or in respect of any payment to any Purchaser hereunder or under the Securities
        or any notes issued in exchange for any Securities, then the amount so payable
        to such Purchaser shall be increased as may be necessary so that, after making
        all required deductions, setoffs and withholdings, such Purchaser shall receive
        an amount equal to the sum they would have received had no such deductions,
        setoffs or withholding been made.

       

      8.7 
Successors
        and Assigns.
        All
        covenants and agreements contained in this Agreement by or on behalf of any
        of
        the parties hereto shall bind and inure to the benefit of the respective
        successors and assigns of the parties hereto whether or not so expressed;
        provided,
        that no
        Borrower shall be permitted to assign or delegate, and each Borrower shall
        prohibit each other Security Party and its Subsidiaries from assigning or
        delegating, its rights or obligations under this Agreement, the Securities
        or
        any notes issued in exchange for any Securities. In addition, and whether
        or not
        any express assignment has been made, the provisions of this Agreement which
        are
        for any Purchaser’s benefit as a purchaser or holder of Securities, notes issued
        in exchange for any Securities are also for the benefit of, and enforceable
        by,
        any subsequent holder of the same. Except as otherwise expressly provided
        herein, nothing expressed in or implied from any Investment Document is intended
        to give, or shall be construed to give, any Person, other than the parties
        hereto and thereto and their permitted successors and assigns, any benefit
        or
        legal or equitable right, remedy or claim under or by virtue of this Agreement
        or any such other document. Any agreement or covenant in any Investment Document
        obligating any issuer of an Capital Stock held by a Purchaser or subsequent
        holder to take any action or to refrain from taking any action, shall similarly
        obligate any other Person into or with which such issuer is merged,
        consolidated, combined or reorganized.

       

      8.8 
Aggregation.
        For
        purposes of the Investment Documents, all holdings of Securities by Persons
        who
        are Affiliates of each other shall be aggregated for purposes of meeting
        any
        threshold tests under the Investment Documents.

       

      8.9 
Severability.
        Whenever possible, each provision of this Agreement shall be interpreted
        in such
        manner as to be effective and valid under applicable law, but if any provision
        of this Agreement is held to be prohibited by or invalid under applicable
        law,
        such provision shall be ineffective

       

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      only
        to
        the extent of such prohibition or invalidity, without invalidating the remainder
        of this Agreement and shall be reformed and enforced to the maximum extent
        permitted under applicable law.

       

      8.10 
        Counterparts.
        This
        Agreement may be executed in two or more counterparts, any one of which need
        not
        contain the signatures of more than one party, but all such counterparts
        taken
        together shall constitute one and the same Agreement.

       

      8.11 
        Descriptive
        Headings.
        The
        descriptive headings of this Agreement and the Securities are inserted for
        convenience only and do not constitute a substantive part of this
        Agreement.

       

      8.12 
        Governing
        Law.
        The
        corporation laws of the State of Missouri shall govern all issues and questions
        concerning the relative rights and obligations of the Security Parties and
        the
        holders of their Capital Stock. All other issues and questions concerning
        the
        construction, validity, enforcement and interpretation of this Agreement
        and the
        schedules hereto and (except as otherwise expressly provided therein) the
        exhibits hereto shall be governed by, and construed in accordance with, the
        laws
        of the State of Missouri, without giving effect to any choice of law or conflict
        of law rules or provisions (whether of the State of Missouri or any other
        jurisdiction) that would cause the application of the laws of any jurisdiction
        other than the State of Missouri. In furtherance of the foregoing, the internal
        law of the State of Missouri shall control the interpretation and construction
        of this Agreement (and all schedules and exhibits hereto), even though under
        that jurisdiction’s choice of law or conflict of law analysis, the substantive
        law of some other jurisdiction would ordinarily apply.

       

      8.13 
        Notices.
        All
        notices, demands or other communications to be given or delivered under or
        by
        reason of the provisions of this Agreement shall be in writing and shall
        be
        deemed to have been given when delivered personally to the recipient, sent
        to
        the recipient by reputable overnight courier service (charges prepaid), mailed
        to the recipient by certified or registered mail, return receipt requested
        and
        postage prepaid or sent via facsimile to the number set forth below with
        a copy
        mailed to the recipient as set forth above. Such notices, demands and other
        communications shall be sent to the Purchasers and to each Security Party
        at the
        addresses indicated below:

       

      To
        each
        Security Party:

       

      Siboney
        Corporation

      Siboney
        Learning Group, Inc.

      325
        Kirkwood Rd., Suite 300

      St.
        Louis, Missouri 63122

      Attn:
        William Edwards

      Facsimile:
        (314) 822-3197

      

      To
        the
        Purchasers:

       

      at
        their
        respective addresses on the records of the Borrowers

       

      or
        to
        such other address or to the attention of such other person as the recipient
        party has specified by prior written notice to the sending party.

       

      8.14 
Construction.
        The
        parties hereto have participated jointly in the negotiation and drafting
        of this
        Agreement. In the event an ambiguity or question of intent or interpretation
        arises, this Agreement shall be construed as if drafted jointly by the parties
        hereto, and no presumption or burden of proof shall arise favoring or
        disfavoring any party by virtue of the authorship of any of the provisions
        of
        this Agreement. The parties intend that each representation, warranty and
        covenant contained herein shall

      
 

      
        
          
            
            

          

          
            22

            
              

            

          

          
            
            

          

        

      

      

      have
        independent significance. If any party has breached any representation, warranty
        or covenant contained herein in any respect or any Event of Default shall
        occur,
        the fact that there exists another representation, warranty or covenant or
        Event
        of Default relating to the same subject matter (regardless of the relative
        levels of specificity) which such party has not breached shall not detract
        from
        or mitigate the fact that such party is in breach of the first representation,
        warranty or covenant or that the first Event of Default shall have
        occurred.

       

      8.15 
        Complete
        Agreement.
        This
        Agreement, those documents expressly referred to herein, and the other documents
        of even date herewith delivered or executed in connection with the transactions
        contemplated hereby embody the complete agreement and understanding among
        the
        parties and supersede any prior agreements or representations by or among
        the
        parties, written or oral, which may have related to the subject matter hereof
        in
        any way.

       

      8.16 
Indemnification.
        In
        consideration of each Purchaser’s execution and delivery, of this Agreement and
        purchase of the Securities hereunder and in addition to all of each Borrower’s
        other obligations under this Agreement and in addition to all other rights
        and
        remedies available at law or in equity, each Borrower shall, and shall cause
        each other Security Party and their Subsidiaries to, defend, protect and
        indemnify the Purchasers and each other holder of Securities, any notes issued
        in exchange for any Securities and all of their officers, managers, directors,
        stockholders, members, partners, limited partners, Affiliates, employees,
        agents, representatives, successors and assigns (including those retained
        in
        connection with the transactions contemplated by this Agreement) (collectively,
        the “Indemnitees”),
        and
        save and hold each of them harmless from and against, and pay on behalf of
        or
        reimburse such part), on demand as and when incurred, any and all actions,
        causes of action, suits, claims, losses (including diminutions in value and
        consequential damages), costs, penalties, fees, liabilities and damages and
        expenses in connection therewith (irrespective of whether any such Indemnitee
        is
        a party to the action for which indemnification hereunder is sought), including
        reasonable attorneys’ fees and disbursements, interest and penalties and all
        amounts paid in investigation, defense or settlement of any of the foregoing
        and
        claims relating to any of the foregoing (the “Liabilities”),
        incurred by the Indemnitees or any of them as a result of, or arising out
        of, or
        relating to: (i) any breach or inaccuracy of any representation or warranty
        of
        any Borrower or Security Party contained in this Agreement or any other
        Transaction Document or any non-fulfillment or breach of any covenant or
        agreement of any Borrower or Security Party contained in this Agreement or
        any
        other Transaction Document; (ii) the execution, delivery, performance or
        enforcement of the Investment Documents, any Governing Documents of any Security
        Party or its Subsidiaries and any other instrument, document or agreement
        executed pursuant hereto or thereto of any Security Party or its Subsidiaries
        by
        any of the Indemnitees, except to the extent any such Liabilities are caused
        by
        the particular Indemnitee’s gross negligence or willful misconduct; and
        (iii) the past, present or future environmental condition of any property
        owned, operated or used by any Security Party, any of its Subsidiaries, their
        predecessors or successors or of any offsite treatment, storage or disposal
        location associated therewith, including, without limitation, the presence
        on or
        under, or the escape, seepage, leakage, spillage, discharge, emission, release
        or threatened release into, onto or from, any such property or location of
        any
        toxic, chemical or hazardous substance, material or waste (including, without
        limitation, any losses, liabilities, damages, injuries, penalties, fees,
        costs,
        expenses or claims asserted or arising under any Environmental and Safety
        Requirement) regardless of whether caused by, or within the control of, such
        Security Party or any of its Subsidiaries. To the extent that the foregoing
        undertaking by each Security Party may be unenforceable for any reason, each
        Security Party shall make the maximum contribution to the payment and
        satisfaction of each of the Liabilities which is permissible under applicable
        law. If there are insufficient funds to meet the obligations of the Security
        Parties and their Subsidiaries under this Section 8.16, any indemnification
        payments made pursuant to this Section, to the extent such indemnification
        relates to Liabilities which are common to all Purchasers, shall be made
        pro
        rata, based on the percentage that the Warrants purchased by each such
        Purchaser, as set forth opposite such Purchaser’s name on the Schedule
        of Purchasers
        attached
        hereto, bears to the total

        
          
            
            

          

          
            23

            
              

            

          

          
            
            

          

        

      aggregate
        Warrants purchased by all Purchasers, as set forth on the Schedule
        of Purchasers  attached
        hereto.

       

      8.17 
Payment
        Set Aside.
        To the
        extent that any payment or payments are made to any Purchaser hereunder or
        under
        the Securities, any notes issued in exchange for any Securities or such
        Purchaser enforces its rights or exercises its right of setoff hereunder
        or
        thereunder, and such payment or payments or the proceeds of such enforcement
        or
        setoff or any part thereof are subsequently invalidated, declared to be
        fraudulent or preferential, set aside, recovered from, disgorged by or are
        required to be refunded, repaid or otherwise restored to such payor, a trustee,
        receiver or any other Person under any law, statute, rule or regulation
        (including, without limitation, any bankruptcy law, state or federal law,
        common
        law or equitable cause of action), then to the extent of any such restoration
        the obligation or part thereof originally intended to be satisfied shall
        be
        revived and continued in full force and effect as if such payment had not
        been
        made or such enforcement or setoff had not occurred.

       

      8.18 Jurisdiction
        and Venue.
        Each of
        the parties: (i) submits to the jurisdiction of any state or federal court
        sitting in St. Louis County, Missouri in any legal suit, action or proceeding
        arising out of or relating to this Agreement, the Securities, any notes issued
        in exchange for any Securities; (ii) agrees that all claims in respect of
        the action or proceeding may be heard or determined in any such court; and
        (iii) agrees not to bring any action or proceeding arising out of or
        relating to this Agreement, the Securities, any notes issued in exchange
        for any
        Securities in any other court. Each of the parties waives any defense of
        inconvenient forum to the maintenance of any action or proceeding so brought
        and
        waives any bond, surety or other security that might be required of any other
        party with respect thereto. Any party may make service on any other party
        by
        sending or delivering a copy of the process to the party to be served at
        the
        address and in the manner provided for the giving of notices in Section
        8.13.
        Each
        party agrees that a final judgment in any action or proceeding so brought
        shall
        be conclusive and may be enforced by suit on the judgment or in any other
        manner
        provided by law. Nothing herein shall affect the right to serve process in
        any
        other manner permitted by law, statute, rule or regulation or shall limit
        the
        right of any Purchaser to bring proceedings against any Security Party in
        the
        courts of any other jurisdiction. To the extent provided by any law, statute,
        rule or regulation, should any Security Party, after being so served, fail
        to
        appear or answer to any summons, complaint, process or papers so served within
        the number of days prescribed by law after the mailing thereof, such Security
        Party shall be deemed in default and an order and/or judgment may be entered
        by
        the court against such Security Party as demanded or prayed for in such summons,
        complaint, process or papers. The exclusive choice of forum for each Security
        Party set forth in this Section
        8.18
        shall
        not be deemed to preclude the enforcement by any Purchaser or any holder
        of
        Securities or notes issued in exchange for any Securities of any judgment
        obtained in any other forum or the taking by such Purchaser or any holder
        of
        Securities or notes issued in exchange for any Securities of any action to
        enforce the same in any other appropriate jurisdiction, and each Security
        Party
        hereby waives the right to collaterally attack any such judgment or
        action.

       

      8.19 
Waiver
        of Right to Jury Trial.
        EACH
        BORROWER, ON ITS OWN BEHALF AND ON BEHALF OF EACH OTHER SECURITY PARTY AND
        ITS
        SUBSIDIARIES, AND EACH HOLDER OF SECURITIES AND NOTES ISSUED IN EXCHANGE
        FOR ANY
        SECURITIES HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL
        BY
        JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH,
        OR
        ARISING OUT OF THIS AGREEMENT, THE SECURITIES, ANY NOTES ISSUED IN EXCHANGE
        FOR
        ANY SECURITIES OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR
        ENFORCEMENT THEREOF. EACH BORROWER, ON ITS OWN BEHALF AND ON BEHALF OF EACH
        OTHER SECURITY PARTY AND ITS SUBSIDIARIES, AGREES THAT THIS SECTION IS A
        SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT AND ACKNOWLEDGES
        THAT

       

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

      THE
        PURCHASERS WOULD NOT PURCHASE THE SECURITIES HEREUNDER IF THIS SECTION WERE
        NOT
        PART OF THIS AGREEMENT.

       

      8.20 
Certain
        Waivers.
        Each
        Borrower hereby waives diligence, presentment, protest and demand and notice
        of
        protest and demand, dishonor and nonpayment of the Notes and any notes issued
        in
        exchange for any Securities, and expressly agrees that the Notes and any
        notes
        issued in exchange for any Securities, or any payment thereunder, may be
        extended from time to time and that the holder thereof may accept security
        for
        the Notes and any notes issued in exchange for any Securities or release
        security for the Notes and any notes issued in exchange for any Securities,
        all
        without in any way affecting the liability of such Borrower
        thereunder.

       

      8.21 
Joint
        and Several Liability of the Security Parties.
        Each
        Security Party shall be jointly and severally liable hereunder and under
        each of
        the Investment Documents to which it is a party with respect to all obligations
        hereunder and thereunder (the “Security
        Party Obligations”),
        regardless of which Security Party actually receives the proceeds from the
        issuance of the Securities, or the manner in which the Borrowers, any other
        Security Party or any Purchaser account therefor in their respective books
        and
        records. Notwithstanding the foregoing: (i) each Security Party’s
        obligations and liabilities with respect to the proceeds from the issuance
        of
        the Securities which it receives, and related fees, costs and expenses; and
        (ii) each Security Party’s obligations and liabilities arising as a result
        of the joint and several liability of a Borrower hereunder with respect to
        proceeds of the Notes received by any other Security Party, together with
        the
        related fees, costs and expenses, shall be separate and distinct obligations,
        both of which are primary obligations of such Security Party. Neither the
        joint
        and several liability of any Security Party shall be impaired or released
        by (a)
        the failure of any Purchaser, any successor or assigns thereof, or any holder
        of
        any Securities, any notes issued in exchange for any Securities or any of
        the
        Security Party Obligations to assert any claim or demand or to exercise or
        enforce any right, power or remedy against any Security Party or its
        Subsidiaries, any other Person or otherwise, (b) any extension or renewal
        for
        any period (whether or not longer than the original period) or exchange of
        any
        of the Security Party Obligations or the release or compromise of any
        obligations of any nature of any Person with respect thereto, (c) the surrender,
        release or exchange of all or any part of any property securing payment,
        performance and/or observance of any of the Security Party Obligations or
        the
        compromise or extension or renewal for any period (whether or not longer
        than
        the original period) of any obligations of any nature of any Person with
        respect
        to any such property, (d) any action or inaction on the part of any Purchaser,
        or any other event or condition with respect to any other Security Party,
        including, without limitation, any such action or inaction or other event
        or
        condition, which might otherwise constitute a defense available to, or a
        discharge of, such other Security
        Party, or a guarantor or surety of or for any or all of the Security Party
        Obligations or (e) any other act, matter or thing (other than payment or
        performance of the Security Party Obligations) which would or might, in the
        absence of this provision, operate to release, discharge or otherwise
        prejudicially affect the obligations of such or any other Security
        Party.

       

      8.22 
Several
        Liability of Purchasers.
        The
        liabilities and obligations of the Purchasers under the Investment Documents,
        including, but not limited to, the Purchasers’ obligation to purchase the
        Securities hereunder are several obligations of the Purchasers. No Purchaser
        shall have any obligation or liability arising under any Investment Document
        or
        otherwise as a result of any other Purchaser’s breach or default hereunder or
        thereunder. EACH BORROWER, ON ITS OWN BEHALF AND ON BEHALF OF EACH OTHER
        SECURITY PARTY AND ITS SUBSIDIARIES, SHALL BE DEEMED TO HAVE WAIVED ANY SUCH
        ACTION, CLAIM, RIGHT OR CAUSE OF ACTION ANY SUCH PARTY MAY HAVE AGAINST ANY
        SUCH
        PURCHASER.

       

      [Remainder
        of page intentionally left blank; signature page follows.]

       

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF,
        the
        parties hereto have executed this Agreement on the date first written
        above.

       

      
        	
                 

                BORROWERS:

              	
                 

                SIBONEY
                  CORPORATION

              	 
	 	 	 
	 	 	 
	
                 

              	
                By:    /s/
                  William D.
                  Edwards                                                         
                  

              	 
	
                 

              	
                Name:     William
                  D.
                  Edwards                                                        
                  

              	 
	
                 

              	
                Title:        Executive
                  Vice
                  President                                              
                  

              	 
	 	 	 
	
                 

                 

              	
                 

                SIBONEY
                  LEARNING GROUP, INC.

              	 
	 	 	 
	 	 	 
	
                 

              	
                
                  By:    /s/
                    William D.
                    Edwards                                                         
                    

                

              	 
	
                 

              	
                
                  Name:     William
                    D.
                    Edwards                                                        
                    

                

              	 
	
                 

              	
                
                  Title:        President                               
                                                             
                    

                

              	 
	 	 	 
	 	 	 
	
                PURCHASERS:

              	 	 
	 	 	 
	 	 	 
	 	 /s/
                Timothy J.
                Tegeler                    
                        
                                                     
                	 
	
                 

              	
                Timothy
                  J. Tegeler

              	 
	 	 	 
	 	 	 
	 	 	 
	 	 /s/
                Lewis B.
                Shepley                                                                     
                	 
	
                 

              	
                Lewis
                  B. Shepley 

              	 

      

      

      

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

      

      SCHEDULE
        OF PURCHASERS

      

      

      
        	
                 

                Names
                  and 

                Addresses

              	
                Principal

                Amount

                of
                  Notes

              	 	
                Purchase

                Price

                for
                  Notes

              	 	
                Number
                  of

                Warrant

                Shares

              	 	
                Purchase
                  Price

              
	 	 	 	 	 	 	 	 
	
                Timothy
                  J. Tegeler

              	
                $100,000

              	 	
                 
                  $80,000

              	 	
                200,000

              	 	
                $20,000

              
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Lewis
                  B. Shepley 

              	
                $100,000

              	 	
                 
                  $80,000

              	 	
                200,000

              	 	
                $20,000

              
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	
                                

              	 	
                                

              	 	
                                

              	 	
                                

              
	 	 	 	 	 	 	 	 
	
                TOTAL

              	
                $200,000

              	 	
                $160,000

              	 	
                400,000

              	 	
                $40,000

              

      

      

      

      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

      LIENS
        SCHEDULE

      

      None

      

      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

      EXHIBIT
        A

      

      FORM
        OF 10% SUBORDINATED SECURED NOTE

       

      THE
        SECURITIES REPRESENTED BY THIS INSTRUMENT WERE ORIGINALLY ISSUED ON MARCH
        21,
        2007, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
        THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT
        TO THE
        CONDITIONS SPECIFIED IN THE NOTE AND WARRANT PURCHASE AGREEMENT, DATED AS
        OF
        MARCH 21, 2007, AND AS AMENDED AND MODIFIED FROM TIME TO TIME, AMONG THE
        BORROWERS, THE INITIAL HOLDER(S) HEREOF AND CERTAIN INVESTORS, WHO FROM TIME
        TO
        TIME BECOME PARTIES THERETO IN ACCORDANCE WITH THE PROVISIONS THEREOF, AND
        THE
        BORROWERS RESERVE THE RIGHT TO REFUSE THE TRANSFER OF SUCH SECURITY UNTIL
        SUCH
        CONDITIONS HAVE BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. UPON WRITTEN
        REQUEST, A COPY OF SUCH CONDITIONS SHALL BE FURNISHED BY THE BORROWERS TO
        THE
        HOLDER HEREOF WITHOUT CHARGE.

       

      THIS
        NOTE
        IS SUBJECT TO THE TERMS AND CONDITIONS OF THAT CERTAIN SUBORDINATION AGREEMENT,
        DATED AS OF MARCH 21, 2007, BY AND BETWEEN __________________ AND SOUTHWEST
        BANK
        OF ST. LOUIS.

      

      SIBONEY
        CORPORATION

      SIBONEY
        LEARNING GROUP, INC. 

      

      10%
        SUBORDINATED SECURED PROMISSORY NOTE

      

      

      
        	
                March
                  21, 2007

              	
                $100,000.00

              

      

      

      

      Siboney
        Corporation, a Maryland corporation, and Siboney Learning Group, Inc., a
        Texas
        corporation (collectively, the “Borrowers”),
        hereby jointly and severally promise to pay to the order of ____________
        the
        principal amount of One Hundred Thousand Dollars ($100,000.00) together with
        interest thereon calculated from the date hereof in accordance with the
        provisions of this Note. 

      

      This
        Note
        was issued pursuant to a Note and Warrant Purchase Agreement, dated as of
        March
        21, 2007 (as amended and modified from time to time, the “Purchase
        Agreement”),
        among
        the Borrowers and certain investors, and this Note is one of the “Notes”
        referred to in the Purchase Agreement. The Purchase Agreement contains terms
        governing the rights of the holder of this Note, and all provisions of the
        Purchase Agreement are hereby incorporated herein in full by reference. Unless
        otherwise indicated herein, capitalized terms used in this Note have the
        same
        meanings set forth in the Purchase Agreement. The obligations evidenced by
        the
        Notes are secured by a security interest in the Borrowers’ assets granted
        pursuant to a Security Agreement dated the date hereof among the Borrowers
        and
        the holders of the Notes.

      

      1. Payment
        of Interest.
        Except
        as otherwise expressly provided in the Purchase Agreement, interest shall
        accrue
        at the rate of 10% per annum (computed on the basis of a 360-day year and
        the
        actual number of days elapsed in any year) on the unpaid principal amount
        of
        this Note outstanding from time to time, or (if less) at the highest rate
        then
        permitted under applicable law; provided,
        however,
        that
        upon the occurrence of any Event of Default, and during the continuation
        thereof,

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

      the
        unpaid principal amount, and the past due interest, if any, of this Note
        shall
        bear interest at a rate of 12% per annum. The Borrowers shall pay to the
        holder
        of this Note all accrued interest on the last day of each calendar quarter,
        beginning June 30, 2007, which
        may, at the option of the Borrowers, be paid in kind rather than in cash
        (i.e.,
        such
        interest shall be capitalized when due and added to the principal balance
        of
        this Note). Any accrued interest which for any reason has not theretofore
        been
        paid shall be paid in full on the date on which the final principal payment
        on
        this Note is made. Interest shall accrue on any principal payment due under
        this
        Note and, to the extent permitted by applicable law, on any interest which
        has
        not been paid on the date on which it is due and payable at the same rate
        at
        which such interest is then accruing on the principal amount of this Note,
        in
        either case, until such time as payment therefore is actually delivered to
        the
        holder of this Note.

      

      2. 
        Payment
        of Principal on Note.
        

      

      (a) 
        Scheduled
        Payments.
        The
        Borrowers shall pay the principal amount of $100,000 (or such lesser principal
        amount then outstanding) to the holder of this Note on March 21, 2009, together
        with all accrued and unpaid interest on the principal amount being
        repaid.

      

      (b)
        Prepayments.
        The
        Borrowers may, at any time and from time to time, prepay all or any portion
        of
        the outstanding principal amount of the Notes, without penalty, pro rata
        among
        the holders of the Notes on the basis of the outstanding principal amount
        of the
        Note held by each holder; provided,
        that
        (A) such prepayment is not prohibited by the provisions of the Subordination
        Agreement and (B) the Borrowers have paid all interest on the Notes accrued
        through the date ten days prior to the date of prepayment specified in the
        Borrowers’ notice referred to in subparagraph (b)(ii) below. In connection with
        each prepayment of principal hereunder, the Borrowers shall also pay all
        accrued
        and unpaid interest on the principal amount of the Notes being repaid. A
        prepayment of less than all of the outstanding principal amount of each of
        the
        Notes shall not relieve the Borrowers of their obligation to make scheduled
        payments on each of the Notes on the scheduled payment dates pursuant to
        Section
        2(a).

      

      3. 
        Holder’s
        Records.
        The
        holder of this Note shall record in its books and records the date and amount
        of
        each payment of principal and/or interest made by Borrowers with respect
        thereto
        (including any payment in kind of interest as described in Section 1 above);
        provided, however, that the obligation of Borrowers to repay this Note shall
        be
        absolute and unconditional, notwithstanding any failure of the holder of
        this
        Note to make any such recordation or any mistake by the holder of this Note
        in
        connection with any such recordation. The books and records of the holder
        of
        this Note showing the account between the holder of this Note and Borrowers
        shall be admissible in evidence in any action or proceeding and shall constitute
        prima facie proof of the items therein set forth.

      

      4. 
        Amendment
        and Waiver.
        Except
        as otherwise expressly provided herein, the provisions of the Notes may be
        amended and the Borrowers may take any action herein prohibited, or omit
        to
        perform any act herein required to be performed by it, only if the Borrowers
        have obtained the written consent of the holders of 100% of the outstanding
        principal amount of the Notes.

      

      5. 
        Cancellation.
        After
        all principal and accrued interest at any time owed on this Note has been
        paid
        in full, this Note shall be surrendered to the Borrowers for cancellation
        and
        shall not be reissued.

      

      6. 
        Payments.
        All
        payments to be made to the holders of the Notes shall be made in the lawful
        money of the United States of America in immediately available
        funds.

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

      7. 
        Place
        of Payment.
        Payments of principal and interest shall be delivered to ______________ at
        his
        address on the records of the Borrowers, or to such other address or to the
        attention of such other person as specified by prior written notice to the
        Borrowers.

      

      8. 
        Business
        Days.
        If any
        payment is due, or any time period for giving notice or taking action expires,
        on a day which is a Saturday, Sunday or legal holiday in the State of Missouri,
        the payment shall be due and payable on, and the time period shall automatically
        be extended to, the next Business Day immediately following such Saturday,
        Sunday or legal holiday, and interest shall continue to accrue at the required
        rate hereunder until any such payment is made.

      

      9. 
        Usury
        Laws.
        It is
        the intention of the Borrowers and the holder of this Note to conform strictly
        to all applicable usury laws now or hereafter in force, and any interest
        payable
        under this Note shall be subject to reduction to the amount not in excess
        of the
        maximum legal amount allowed under the applicable usury laws as now or hereafter
        construed by the courts having jurisdiction over such matters. If the maturity
        of this Note is accelerated by reason of an election by the holder hereof
        resulting from an Event of Default, voluntary prepayment by the Borrowers
        or
        otherwise, then earned interest may never include more than the maximum amount
        permitted by law, statute, rule or regulation, computed from the date hereof
        until payment, and any interest in excess of the maximum amount permitted
        by
        law, statute, rule or regulation shall be canceled automatically and, if
        theretofore paid, shall at the option of the holder hereof either be rebated
        to
        the Borrowers or credited on the principal amount of this Note, or if this
        Note
        has been paid, then the excess shall be rebated to the Borrowers. The aggregate
        of all interest (whether designated as interest, service charges, points
        or
        otherwise) contracted for, chargeable, or receivable under this Note shall
        under
        no circumstances exceed the maximum legal rate upon the unpaid principal
        balance
        of this Note remaining unpaid from time to time. If such interest does exceed
        the maximum legal rate, it shall be deemed a mistake and such excess shall
        be
        canceled automatically and, if theretofore paid, rebated to the Borrowers
        or
        credited on the principal amount of this Note, or if this Note has been repaid,
        then such excess shall be rebated to the Borrowers.

      

      10. 
        Construction.
        The
        undersigned and the original holder of this Note have participated jointly
        in
        the negotiation and drafting of this Note. In the event an ambiguity or question
        of intent or interpretation arises, this Note shall be construed as if drafted
        jointly by the undersigned and the original holder of this Note, and no
        presumption or burden of proof shall arise favoring or disfavoring any party
        by
        virtue of the authorship of any of the provisions of this Note.

       

      11. 
        Governing
        Law.
        This
        .Note
        shall be governed and construed in accordance with the domestic laws of the
        State of Missouri, without giving effect to any choice of law or conflict
        of
law
        provision
        or rule (whether of the State of Missouri or any other jurisdiction) that
        would
        cause the application of the laws of any
        jurisdiction
        other than the State of Missouri.

       

      12. 
        Replacement.
        Upon receipt of evidence reasonably satisfactory to the Borrowers (an affidavit
        of the holder of this Note shall be satisfactory) of the ownership and the
        loss,
        theft, destruction or mutilation of this Note, and in the case of any such
        loss,
        theft or destruction, upon receipt of indemnity reasonably satisfactory to
        the
        Borrowers (provided, that if the holder of this Note is a financial institution
        or other institutional investor its own agreement shall be satisfactory),
        or, in
        the case of any such mutilation upon surrender of this Note, the Borrowers
        shall
        (at their expense) execute and deliver, in lieu thereof, a new Note of like
        kind
        representing the same rights represented by such lost, stolen, destroyed
        or
        mutilated Note and dated the date of such lost, stolen, destroyed or mutilated
        Note.

       

      13. 
        Notices.
        Except as otherwise expressly provided herein, all notices referred to in
        this
        Note shall be in writing and shall be delivered personally, sent by reputable
        overnight courier
        service (charges prepaid) or sent by registered or certified mail, return
        receipt requested, postage prepaid and

       

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

      shall
        be
        deemed to have been given when so delivered, sent or deposited in the U.S.
        Mail
        (i) to the Borrowers, at their principal executive offices and (ii) to the
        holder of this Note, at such holder’s address as it appears in the records of
        the Borrowers (unless otherwise indicated in writing by any such
        holder).

       

      14. 
        Certain
        Waivers .
        Each
        party executing this Note hereby waives diligence, presentment, protest and
        demand and notice of protest and demand, dishonor and nonpayment of this
        Note,
        and expressly agrees that this Note, or any payment hereunder, may be extended
        from time to time and that the holder hereof may accept security for this
        Note
        or release security for this Note, all without in any way affecting the
        liability of the undersigned for all obligations and liabilities under this
        Note.

       

      Notice
        Required by Section 432.047 R.S. Mo.: “ORAL
        AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM
        ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH
        DEBT
        ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED
        THAT
        IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU (BORROWER(S))
        AND
        US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE
        REACH
        COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE
        AND
        EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE
        IN
        WRITING TO MODIFY IT.”

      

      [Remainder
        of page intentionally left blank; signature page follows.]

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the undersigned have executed and delivered this Note on
        March
        21, 2007. 

       

      
        	
                 

              	
                SIBONEY
                  CORPORATION

              	 
	 	 	 
	 	 	 
	
                 

              	
                By:                                          
                                                                           
                  

              	 
	
                 

              	
                Name:                                      
                                                                          
                  

              	 
	
                 

              	
                Title:                                                  
                                                                
                  

              	 
	 	 	 
	 	 	 
	
                 

              	
                SIBONEY
                  LEARNING GROUP, INC.

              	 
	 	 	 
	 	 	 
	
                 

              	
                By:                                          
                                                                            
                  

              	 
	
                 

              	
                Name:                                     
                                                                            
                  

              	 
	
                 

              	
                Title:                               
                                                                                    
                  

              	 

      

      

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

      EXHIBIT
        B

      

      FORM
        OF WARRANT

      

       

      NEITHER
        THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
        HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
        SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
        REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
        ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
        EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
        AN
        AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
        REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
        SECURITIES LAWS AND, IF REQUESTED BY THE COMPANY, AS EVIDENCED BY A LEGAL
        OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH
        SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 

       

      SIBONEY
        CORPORATION

       

      WARRANT

       

       

      

       

      
        	
                Warrant
                  No. ___

              	
                Date
                  of Original Issuance: March 21,
                  2007

              

      

      

      

      Siboney
        Corporation, a Maryland corporation (the "Company"),
        hereby
        certifies that, for value received, ______________________ or his registered
        assigns (the "Holder"),
        is
        entitled to purchase from the Company up to a total of 200,000 shares of
        common
        stock, par value $0.10 per share (the "Common
        Stock"),
        of the
        Company (each such share, a "Warrant
        Share"
        and all
        such shares, the "Warrant
        Shares")
        at an
        exercise price equal to $0.01 per share (as adjusted from time to time as
        provided in Section 9, the "Exercise
        Price"),
        at any
        time and from time to time following from and after the Date of Original
        Issuance set forth above and March 21, 2012 (the "Expiration
        Date"),
        and
        subject to the following terms and conditions:

       

      1. 
        Definitions.
        In addition to the terms defined elsewhere in this Warrant, capitalized terms
        that are not otherwise defined herein shall have the meanings given to such
        terms in the Note and Warrant Purchase Agreement, dated as of March 21, 2007,
        (the "Purchase
        Agreement")
        by and
        among the Company, Siboney Learning Group, Inc. and the other Lender named
        therein.

       

      2. 
        Registration
        of Warrant. The Company shall register this Warrant, upon records to be
        maintained by the Company for that purpose (the "Warrant
        Register"),
        in the
        name of the record Holder hereof from time to time. The Company may deem
        and
        treat the registered Holder of this Warrant as the absolute owner hereof
        for the
        purpose of any exercise hereof or any distribution to the Holder, and for
        all
        other purposes, absent actual notice to the contrary.

       

      3. 
        Registration
        of Transfers. The Company shall register the transfer of any portion of this
        Warrant in the Warrant Register, upon surrender of this Warrant, with the
        Form
        of Assignment attached hereto duly completed and signed, to the Company at
        its
        address specified herein. Upon any such registration or transfer, a new Warrant
        to purchase Common Stock, in substantially the form of this Warrant (any
        such
        new Warrant, a "New
        Warrant"),
        evidencing the portion of this Warrant so transferred shall be issued to
        the
        transferee and a New Warrant evidencing the remaining portion of
        this

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

      Warrant
        not so transferred, if any, shall be issued to the transferring Holder. The
        acceptance of the New Warrant by the transferee thereof shall be deemed the
        acceptance by such transferee of all of the rights and obligations of a holder
        of a Warrant. 

       

      4. 
        Exercise
        and Duration of Warrants. This Warrant shall be exercisable by the
        registered Holder at any time and from time to time on or after the date
        hereof
        to and including the Expiration Date. At 5:00 p.m., St. Louis, Missouri time
        on
        the Expiration Date, the portion of this Warrant not exercised prior thereto
        shall be and become void and of no value, provided, that if the last reported
        sales price of the Common Stock as reported on the principal trading market
        on
        which the Common Stock is then quoted, immediately prior to the close of
        business on the Expiration Date is greater than the Exercise Price on the
        Expiration Date, then this Warrant shall be deemed to have been exercised
        in
        full (to the extent not previously exercised) on a “cashless exercise” basis at
        5:00 p.m. St. Louis, Missouri time on the Expiration Date. The Company may
        not
        call or redeem all or any portion of this Warrant without the prior written
        consent of the Holder.

       

      5. 
        Delivery
        of Warrant Shares.

       

      (a) To
        effect
        exercises hereunder, the Holder shall not be required to physically surrender
        this Warrant unless the aggregate Warrant Shares represented by this Warrant
        is
        being exercised. Upon delivery of the Exercise Notice to the Company (with
        the
        attached Warrant Shares Exercise Log) at its address for notice set forth
        herein
        and upon payment of the Exercise Price multiplied by the number of Warrant
        Shares that the Holder intends to purchase hereunder, the Company shall promptly
        issue and deliver to the Holder, a certificate for the Warrant Shares issuable
        upon such exercise. A "Date
        of Exercise"
        means
        the date on which the Holder shall have delivered to Company: (i) the Exercise
        Notice (with the Warrant Exercise Log attached to it), appropriately completed
        and duly signed and (ii) if such Holder is not utilizing the cashless exercise
        provisions set forth in this Warrant, payment of the Exercise Price for the
        number of Warrant Shares so indicated by the Holder to be
        purchased.

       

      (b) The
        Company's obligations to issue and deliver Warrant Shares in accordance with
        the
        terms hereof are absolute and unconditional, irrespective of any action or
        inaction by the Holder to enforce the same, any waiver or consent with respect
        to any provision hereof, the recovery of any judgment against any Person
        or any
        action to enforce the same, or any setoff, counterclaim, recoupment, limitation
        or termination, or any breach or alleged breach by the Holder or any other
        Person of any obligation to the Company or any violation or alleged violation
        of
        law by the Holder or any other Person, and irrespective of any other
        circumstance which might otherwise limit such obligation of the Company to
        the
        Holder in connection with the issuance of Warrant Shares. Nothing herein
        shall
        limit a Holder's right to pursue any other remedies available to it hereunder,
        at law or in equity including, without limitation, a decree of specific
        performance and/or injunctive relief with respect to the Company's failure
        to
        timely deliver certificates representing shares of Common Stock upon exercise
        of
        the Warrant as required pursuant to the terms hereof.

       

      6. 
        Charges,
        Taxes and Expenses. Issuance and delivery of certificates for shares of
        Common Stock upon exercise of this Warrant shall be made without charge to
        the
        Holder for any issue or transfer tax, withholding tax, transfer agent fee
        or
        other incidental tax or expense in respect of the issuance of such certificates,
        all of which taxes and expenses shall be paid by the Company; provided, however,
        that the Company shall not be required to pay any tax which may be payable
        in
        respect of any transfer involved in the registration of any certificates
        for
        Warrant Shares or Warrants in a name other than that of the Holder. The Holder
        shall be responsible for all other tax liability that may arise as a result
        of
        holding or transferring this Warrant or receiving Warrant Shares upon exercise
        hereof.

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

      7. 
        Replacement
        of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the
        Company shall issue or cause to be issued in exchange and substitution for
        and
        upon cancellation hereof, or in lieu of and substitution for this Warrant,
        a New
        Warrant, but only upon receipt of evidence reasonably satisfactory to the
        Company of such loss, theft or destruction and customary and reasonable
        indemnity (which may include a surety bond for any Holder other than the
        original Holder of the Warrant), if requested. Applicants for a New Warrant
        under such circumstances shall also comply with such other reasonable
        regulations and procedures and pay such other reasonable third party costs
        as
        the Company may prescribe. If a New Warrant is requested as a result of a
        mutilation of this Warrant, then the Holder shall deliver such mutilated
        Warrant
        to the Company as a condition precedent to the Company’s obligation to issue the
        New Warrant.

       

      8. 
        Reservation
        of Warrant Shares. The Company covenants that it will at all times reserve
        and keep available out of the aggregate of its authorized but unissued and
        otherwise unreserved Common Stock, solely for the purpose of enabling it
        to
        issue Warrant Shares upon exercise of this Warrant as herein provided, the
        number of Warrant Shares which are then issuable and deliverable upon the
        exercise of this entire Warrant, free from preemptive rights or any other
        contingent purchase rights of persons other than the Holder (taking into
        account
        the adjustments and restrictions of Section 9). The Company covenants
        that all Warrant Shares so issuable and deliverable shall, upon issuance
        and the
        payment of the applicable Exercise Price in accordance with the terms hereof,
        be
        duly and validly authorized, issued and fully paid and
        nonassessable.

       

      9. 
        Certain
        Adjustments. The Exercise Price and number of Warrant Shares issuable upon
        exercise of this Warrant are subject to adjustment from time to time as set
        forth in this Section 9.

       

      (a) Stock
        Dividends and Splits.
        If the
        Company, at any time while this Warrant is outstanding, (i) pays a stock
        dividend on its Common Stock or otherwise makes a distribution on any class
        of
        capital stock that is payable in shares of Common Stock, (ii) subdivides
        outstanding shares of Common Stock into a larger number of shares, or (iii)
        combines outstanding shares of Common Stock into a smaller number of shares,
        then in each such case the Exercise Price shall be multiplied by a fraction
        of
        which the numerator shall be the number of shares of Common Stock outstanding
        immediately before such event and of which the denominator shall be the number
        of shares of Common Stock outstanding immediately after such event. Any
        adjustment made pursuant to clause (i) of this paragraph shall become effective
        immediately after the record date for the determination of shareholders entitled
        to receive such dividend or distribution, and any adjustment pursuant to
        clause
        (ii) or (iii) of this paragraph shall become effective immediately after
        the
        effective date of such subdivision or combination. If any event requiring
        an
        adjustment under this paragraph occurs during the period that an Exercise
        Price
        is calculated hereunder, then the calculation of such Exercise Price shall
        be
        adjusted appropriately to reflect such event.

       

      (b) Pro
        Rata Distributions.
        If the
        Company, at any time while this Warrant is outstanding, distributes to all
        holders of Common Stock (i) evidences of its indebtedness, (ii) any
        security (other than a distribution of Common Stock covered by the preceding
        paragraph), (iii) rights or warrants to subscribe for or purchase any
        security, or (iv) any other asset (in each case, "Distributed
        Property"),
        then,
        at the request of any Holder delivered before the 90th day after the record
        date
        fixed for determination of shareholders entitled to receive such distribution,
        the Company will deliver to such Holder, promptly after such request (or,
        if
        later, on the effective date of such distribution), the Distributed Property
        that such Holder would have been entitled to receive in respect of the Warrant
        Shares for which such Holder's Warrant could have been exercised immediately
        prior to such record date. If such Distributed Property is not delivered
        to a
        Holder pursuant to the preceding sentence, then upon any exercise of the
        Warrant
        that occurs after such record date, such Holder shall be entitled to receive,
        in
        addition to the Warrant Shares otherwise issuable upon such conversion, the
        Distributed Property that

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

      such
        Holder would have been entitled to receive in respect of such number of Warrant
        Shares had the Holder been the record holder of such Warrant Shares immediately
        prior to such record date. Notwithstanding the foregoing, this Section 9(b)
        shall not apply to any distribution of rights or securities in respect of
        adoption by the Company of a shareholder rights plan which events shall be
        covered by the anti-dilution provisions of Section 9(a).

       

      (c) Fundamental
        Transactions.
        If, at
        any time while this Warrant is outstanding, (1) the Company effects any merger
        or consolidation of the Company with or into another Person, (2) the Company
        effects any sale of all or substantially all of its assets in one or a series
        of
        related transactions, (3) any tender offer or exchange offer approved or
        authorized by the Board of Directors of the Company (whether by the Company
        or
        another Person) is completed pursuant to which holders of Common Stock are
        permitted to tender or exchange their shares for other securities, cash or
        property, or (4) the Company effects any reclassification of the Common Stock
        or
        any compulsory share exchange pursuant to which the Common Stock is effectively
        converted into or exchanged for other securities, cash or property (in any
        such
        case, a "Fundamental
        Transaction"),
        then
        the Holder shall have the right thereafter to receive, upon exercise of this
        Warrant, the same amount and kind of securities, cash or property as it would
        have been entitled to receive upon the occurrence of such Fundamental
        Transaction if it had been, immediately prior to such Fundamental Transaction,
        the holder of the number of Warrant Shares then issuable upon exercise in
        full
        of this Warrant (the "Alternate
        Consideration").
        For
        purposes of any such exercise, the determination of the Exercise Price shall
        be
        appropriately adjusted to apply to such Alternate Consideration based on
        the
        amount of Alternate Consideration issuable in respect of one share of Common
        Stock in such Fundamental Transaction, and the Company shall apportion the
        Exercise Price among the Alternate Consideration in a reasonable manner
        reflecting the relative value of any different components of the Alternate
        Consideration. If holders of Common Stock are given any choice as to the
        securities, cash or property to be received in a Fundamental Transaction,
        then
        the Holder shall be given the same choice as to the Alternate Consideration
        it
        receives upon any exercise of this Warrant following such Fundamental
        Transaction. At the Holder's request, any successor to the Company or surviving
        entity in such Fundamental Transaction shall issue to the Holder a new warrant
        substantially in the form of this Warrant and consistent with the foregoing
        provisions and evidencing the Holder's right to purchase the Alternate
        Consideration for the aggregate Exercise Price upon exercise thereof. The
        terms
        of any agreement pursuant to which a Fundamental Transaction is effected
        shall
        include terms requiring any such successor or surviving entity to comply
        with
        the provisions of this paragraph (c) and insuring that the Warrant (or any
        such
        replacement security) will be similarly adjusted upon any subsequent transaction
        analogous to a Fundamental Transaction.

       

      (d) Number
        of Warrant Shares.
        Simultaneously with any adjustment to the Exercise Price pursuant to paragraph
        (a) of this Section, the number of Warrant Shares that may be purchased upon
        exercise of this Warrant shall be increased or decreased proportionately,
        so
        that after such adjustment the aggregate Exercise Price payable hereunder
        for
        the adjusted number of Warrant Shares shall be the same as the aggregate
        Exercise Price in effect immediately prior to such adjustment.

       

      (e) Calculations.
        All
        calculations under this Section
        9
        shall be
        made to the nearest cent or the nearest 1/100th
        of a
        share, as applicable. 

       

      (f) Notice
        of Adjustments.
        Upon
        the occurrence of each adjustment pursuant to this Section
        9,
        the
        Company at its expense will promptly compute such adjustment in accordance
        with
        the terms of this Warrant and prepare a certificate setting forth such
        adjustment, including a statement of the adjusted Exercise Price and adjusted
        number or type of Warrant Shares or other securities issuable upon exercise
        of
        this Warrant (as applicable), describing the transactions giving rise to
        such
        adjustments and showing in detail the facts upon which such adjustment is
        based.
        Upon written request, the Company will promptly deliver a copy of each such
        certificate to the Holder and to the Company's transfer agent.

       

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

      (g) Notice
        of Corporate Events.
        If the
        Company (i) declares a dividend or any other distribution of cash, securities
        or
        other property in respect of its Common Stock, including without limitation
        any
        granting of rights or warrants to subscribe for or purchase any capital stock
        of
        the Company or any Subsidiary, (ii) authorizes or approves, enters into any
        agreement contemplating or solicits shareholder approval for any Fundamental
        Transaction or (iii) authorizes the voluntary dissolution, liquidation or
        winding up of the affairs of the Company, then the Company shall deliver
        to the
        Holder a notice describing the material terms and conditions of such
        transaction, at least 20 calendar days prior to the applicable record or
        effective date on which a Person would need to hold Common Stock in order
        to
        participate in or vote with respect to such transaction, and the Company
        will
        take all steps reasonably necessary in order to insure that the Holder is
        given
        the practical opportunity to exercise this Warrant prior to such time so
        as to
        participate in or vote with respect to such transaction; provided, however,
        that
        the failure to deliver such notice or any defect therein shall not affect
        the
        validity of the corporate action required to be described in such
        notice.

       

      10. 
        Payment
        of Exercise Price. The
        Holder may pay the Exercise Price in one of the following manners:

       

      (a) Cash
        Exercise.
        The
        Holder may deliver immediately available funds; or

       

      (b) Cashless
        Exercise.
        The
        Holder may notify the Company in an Exercise Notice of its election to utilize
        cashless exercise, in which event the Company shall issue to the Holder the
        number of Warrant Shares determined as follows:

       

      X
        = Y
        [(A-B)/A]

       

      where:

      X
        = the
        number of Warrant Shares to be issued to the Holder.

       

      Y
        = the
        number of Warrant Shares with respect to which this Warrant is being
        exercised.

       

      A
        = the
        average of the closing prices for the five Trading Days immediately prior
        to
        (but not including) the Exercise Date.

       

      B
        = the
        Exercise Price.

       

      For
        purposes of Rule 144 promulgated under the Securities Act, it is intended,
        understood and acknowledged that the Warrant Shares issued in a cashless
        exercise transaction shall be deemed to have been acquired by the Holder,
        and
        the holding period for the Warrant Shares shall be deemed to have commenced,
        on
        the date this Warrant was originally issued.

      

      As
        used
        herein, “Trading Day” shall mean a day on which the principal market on which
        the Company’s stock is listed or quoted, as the case may be, is open for
        trading.

      

      11. 
        No
        Fractional Shares. No fractional shares of Warrant Shares will be issued in
        connection with any exercise of this Warrant. In lieu of any fractional shares
        which would, otherwise be issuable, the Company shall pay cash equal to the
        product of such fraction multiplied by the closing price of one Warrant Share
        as
        reported by the applicable Trading Market on the date of exercise.

       

      12. 
        Notices.
        Any and all notices or other communications or deliveries hereunder (including,
        without limitation, any Exercise Notice) shall be in writing and shall be
        deemed
        given and effective on

       

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

       

      the
        earliest of (i) the date of transmission, if such notice or communication
        is
        delivered via facsimile at the facsimile number specified in this Section
        prior
        to 5:00 p.m. (St. Louis, Missouri time) on a Trading Day, (ii) the next Trading
        Day after the date of transmission, if such notice or communication is delivered
        via facsimile at the facsimile number specified in this Section on a day
        that is
        not a Trading Day or later than 5:00 p.m. (St. Louis, Missouri time) on any
        Trading Day, (iii) the Trading Day following the date of mailing, if sent
        by
        nationally recognized overnight courier service, or (iv) upon actual receipt
        by
        the party to whom such notice is required to be given. The addresses for
        such
        communications shall be: (i) if to the Company, to Siboney Corporation,
        attention: Chief Financial Officer, 325 N. Kirkwood Road, Suite 200, St.
        Louis,
        Missouri, Facsimile No.: (314) 984-8063, or (ii) if to the Holder, to the
        address or facsimile number appearing on the Warrant Register or such other
        address or facsimile number as the Holder may provide to the Company in
        accordance with this Section.

       

      13. Warrant
        Agent. The Company shall serve as warrant agent under this Warrant. Upon at
        least 30 days' notice to the Holder, the Company may appoint a new warrant
        agent. Any corporation into which the Company or any new warrant agent may
        be
        merged or any corporation resulting from any consolidation to which the Company
        or any new warrant agent shall be a party or any corporation to which the
        Company or any new warrant agent transfers substantially all of its corporate
        trust or shareholders services business shall be a successor warrant agent
        under
        this Warrant without any further act. Any such successor warrant agent shall
        promptly cause notice of its succession as warrant agent to be mailed (by
        first
        class mail, postage prepaid) to the Holder at the Holder's last address as
        shown
        on the Warrant Register.

       

      14. 
        Miscellaneous.

       

      (a) This
        Warrant shall be binding on and inure to the benefit of the parties hereto
        and
        their respective successors and assigns. Subject to the preceding sentence,
        nothing in this Warrant shall be construed to give to any Person other than
        the
        Company and the Holder any legal or equitable right, remedy or cause of action
        under this Warrant. This Warrant may be amended only in writing signed by
        the
        Company and the Holder and their successors and assigns.

       

      (b) All
        questions concerning the construction, validity, enforcement and interpretation
        of this Warrant shall be governed by and construed and enforced in accordance
        with the internal laws of the State of Missouri, without regard to the
        principles of conflicts of law thereof. Each party agrees that all legal
        proceedings concerning the interpretations, enforcement and defense of this
        Warrant and the transactions herein contemplated (“Proceedings”)
        (whether brought against a party hereto or its respective Affiliates, employees
        or agents) shall be commenced exclusively in the state and federal courts
        sitting in the St. Louis, Missouri (the “Missouri
        Courts”).
        Each
        party hereto hereby irrevocably submits to the exclusive jurisdiction of
        the
        Missouri Courts for the adjudication of any dispute hereunder or in connection
        herewith or with any transaction contemplated hereby or discussed herein,
        and
        hereby irrevocably waives, and agrees not to assert in any Proceeding, any
        claim
        that it is not personally subject to the jurisdiction of any Missouri Court,
        or
        that such Proceeding has been commenced in an improper or inconvenient forum.
        Each party hereto hereby irrevocably waives personal service of process and
        consents to process being served in any such Proceeding by mailing a copy
        thereof via registered or certified mail or overnight delivery (with evidence
        of
        delivery) to such party at the address in effect for notices to it under
        this
        Warrant and agrees that such service shall constitute good and sufficient
        service of process and notice thereof. Nothing contained herein shall be
        deemed
        to limit in any way any right to serve process in any manner permitted by
        law.
        Each party hereto hereby irrevocably waives, to the fullest extent permitted
        by
        applicable law, any and all right to trial by jury in any legal proceeding
        arising out of or relating to this Warrant or the transactions contemplated
        hereby. If either party shall commence a Proceeding to enforce any provisions
        of
        this Warrant, then the prevailing party in such Proceeding shall

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

      be
        reimbursed by the other party for its attorney’s fees and other costs and
        expenses incurred with the investigation, preparation and prosecution of
        such
        Proceeding.

       

      (c) The
        headings herein are for convenience only, do not constitute a part of this
        Warrant and shall not be deemed to limit or affect any of the provisions
        hereof.

       

      (d) In
        case
        any one or more of the provisions of this Warrant shall be invalid or
        unenforceable in any respect, the validity and enforceability of the remaining
        terms and provisions of this Warrant shall not in any way be affected or
        impaired thereby and the parties will attempt in good faith to agree upon
        a
        valid and enforceable provision which shall be a commercially reasonable
        substitute therefor, and upon so agreeing, shall incorporate such substitute
        provision in this Warrant.

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK,

      SIGNATURE
        PAGE FOLLOWS]

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the Company has caused this Warrant to be duly executed
        by its
        authorized officer as of the date first indicated above.

       

      
        	
                 

              	
                SIBONEY
                  CORPORATION

              	 
	
                 

              	
                By: 
                                                                                                                      
                  

              	 
	
                 

              	
                Name:

              	 
	
                 

              	
                Title:

              	 

      

       

      
 

      
        
          
          

        

        
          41

          
            

          

        

        
          
          

        

      

       

      EXERCISE
        NOTICE

       

      To
        Siboney Corporation

      

      The
        undersigned hereby irrevocably elects to purchase _____________ shares of
        common
        stock, par value $0.10 per share, of SIBONEY CORPORATION ("Common
        Stock"),
        pursuant to Warrant No. ___, originally issued March 21, 2007 (the “Warrant”),
        and,
        if such Holder is not utilizing the cashless exercise provisions set forth
        in
        the Warrant, encloses herewith $________ in cash, certified or official bank
        check or checks or other immediately available funds, which sum represents
        the
        aggregate Exercise Price (as defined in the Warrant) for the number of shares
        of
        Common Stock to which this Exercise Notice relates, together with any applicable
        taxes payable by the undersigned pursuant to the Warrant.

       

      The
        undersigned requests that certificates for the shares of Common Stock issuable
        upon this exercise be issued in the name of

       

      
        	
                 

                 

                 

              	
                 

                PLEASE
                  INSERT SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER

                 

              

      

      (Please
        print name and address)

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Warrant
        Shares Exercise Log

       

       

      
        	
                Date

                 

              	
                Number
                  of Warrant

                Shares
                  Available to be

                Exercised

                 

              	
                Number
                  of Warrant Shares

                Exercised

                 

              	
                Number
                  of

                Warrant
                  Shares

                Remaining
                  to be

                 Exercised

              
	
                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

              	 	 	 

      

      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      FORM
        OF
        ASSIGNMENT

       

       

      

       

      [To
        be
        completed and signed only upon transfer of Warrant]

       

      FOR
        VALUE
        RECEIVED, the undersigned hereby sells, assigns and transfers unto
        ________________________________ the right represented by the within Warrant
        to
        purchase ____________ shares of Common Stock of SIBONEY CORPORATION to which
        the
        within Warrant relates and appoints ________________ attorney to transfer
        said
        right on the books of the Company with full power of substitution in the
        premises.

       

      Dated: _______________,
        ____

      
        	 	 
	
                 

              	
                _______________________________________

              
	
                 

              	
                (Signature
                  must conform in all respects to name of

                holder
                  as specified on the face of the Warrant)

              
	 	 
	 	 
	
                 

              	
                _______________________________________

              
	
                 

              	
                Address
                  of Transferee

              
	 	 
	 	 
	
                 

              	
                _______________________________________

              
	
                 

              	
                _______________________________________

              

      

       

       

      In
        the
        presence of:

       

      __________________________

      

      

      3Exhibit 10.(n)

    
      

    

    Exhibit
      10(n)

    
 

    SUBORDINATION
      AGREEMENT

    

    
      	
              Principal

              $1,125,000.00

            	
              Loan
                Date

              03-21-2007

            	
              Maturity

              04-01-2008

            	
              Loan
                No

              12030954-10000

            	
              Call/Coll

            	
              Account

              00000122565

            	
              Officer

              32405

            	
              Initials

            
	
              -

            
	
              References
                in the shaded area are for Lender’s use only and do not limit the
                applicability of this document to any particular loan or item. Any
                item
                above containing “***” has been omitted due to text length
                limitations.

            

    

     

    
      
        	
                Borrower:

              	
                Siboney
                  Learning Group, Inc.

              	
                Lender:

              	
                Southwest
                  Bank of St. Louis

              
	
                 

              	
                Siboney
                  Corporation

              	
                 

              	
                St.
                  Louis Region Commercial Lending

              
	
                 

              	
                325
                  Kirkwood Rd. Ste 300

              	
                 

              	
                13205
                  Manchester Road

              
	
                 

              	
                St.
                  Louis, MO 63122

              	
                 

              	
                Des
                  Peres, MO 63131

              

      

       

    

    Creditor:

    
      
        

      

    THIS
      SUBORDINATION AGREEMENT dated _______________, is made and executed among
      Siboney Learning Group, Inc.; and Siboney Corporation; 325 Kirkwood Rd. Ste
      300;
      St Louis, MO 63122 (“Borrower”);
      ________________, ______________________________ (“Creditor”); and
      Southwest Bank of St. Louis, St Louis Region Commercial Lending, 13205
      Manchester Road, Des Peres, MO 63131 (“Lender”).

    

    CURRENT
      INDEBTEDNESS OWING TO CREDITOR.
      As of
      the date of this Agreement, Borrower is indebted to Creditor in the aggregate
      amount of $100,000.00.
      This
      amount is the total indebtedness of every kind from Borrower to
      Creditor.

    

    REQUESTED
      FINANCIAL ACCOMMODATIONS.
      Creditor and Borrower each want Lender to provide financial accommodations
      to
      Borrower in the form of (A) new credit or loan advances, (B) an extension of
      time to pay or other compromises regarding all or part of Borrower’s present
      indebtedness to Lender, or (C) other benefits to Borrower. Borrower and Creditor
      each represent and acknowledge to Lender that Creditor will benefit as a result
      of these financial accommodations from Lender to Borrower, and Creditor
      acknowledges receipt of valuable consideration for entering into this Agreement.
      Based
      on the representations and acknowledgments contained in this Agreement, Borrower
      and Creditor agree with Lender as follows:

    

    SUBORDINATED
      INDEBTEDNESS.
      The
      words “Subordinated Indebtedness” as used in this Agreement mean the following
      specific indebtedness from Borrower to Creditor, including all renewals,
      extensions, modifications and substitutions for the indebtedness, including
      principal, interest, and all costs and attorneys’ fees, relating to the
      indebtedness: $100,000.00.

    

    SUPERIOR
      INDEBTEDNESS.
      The
      words “Superior Indebtedness” as used in this Agreement mean and include all
      present and future indebtedness, obligations, liabilities, claims, rights,
      and
      demands of any kind which may be now or hereafter owing from Borrower
      to Lender.
      The
      term “Superior Indebtedness” is used in its broadest sense and includes without
      limitation all principal, all interest, all costs, attorneys’ fees, all sums
      paid for the purpose of protecting Lender’s rights in security (such as paying
      for insurance on collateral if the owner fails to do so), all contingent
      obligations of Borrower (such as a guaranty), all obligations arising by reason
      of Borrower’s accounts with Lender (such as an overdraft on a checking account),
      and all other obligations of Borrower to Lender, secured or unsecured, of any
      nature whatsoever.

    

    SUBORDINATION.
      All
      Subordinated Indebtedness of Borrower to Creditor is and shall be subordinated
      in all respects to all Superior Indebtedness of Borrower to Lender. If Creditor
      holds one or more Security Interests, whether now existing or hereafter
      acquired, in any of Borrower’s real property or personal property, Creditor also
      subordinates all Creditor’s Security Interests to all Security Interests held by
      Lender, whether now existing or hereafter acquired.

    

    PAYMENTS
      TO CREDITOR.
      Borrower will not make and Creditor will not accept, at any time while any
      Superior Indebtedness is owing to Lender, (A) any payment upon any Subordinated
      Indebtedness, (B) any advance, transfer, or assignment of assets to Creditor
      in
      any form whatsoever that would reduce at any time or in any way the amount
      of
      Subordinated Indebtedness, or (C) any transfer of any assets as security for
      the
      Subordinated Indebtedness, except upon Lender’s prior written
      consent.

    

    In
      the
      event of any distribution, division, or application, whether partial or
      complete, voluntary or involuntary, by operation of law or otherwise, of all
      or
      any part of Borrower’s assets, or the proceeds of Borrower’s assets, in whatever
      form, to creditors of Borrower or upon any indebtedness of Borrower, whether
      by
      reason of the liquidation, dissolution or other winding-up of Borrower, or
      by
      reason of any execution sale, receivership, insolvency, or bankruptcy
      proceeding, assignment for the benefit of creditors, proceedings for
      reorganization, or readjustment of Borrower or Borrower’s properties, then and
      in such event, (A) the Superior Indebtedness shall be paid in full before any
      payment is made upon the Subordinated Indebtedness, and (B) all payments and
      distributions, of any kind or character and whether in cash, property, or
      securities, which shall be payable or deliverable upon or in respect of the
      Subordinated Indebtedness shall be paid or delivered directly to Lender for
      application in payment of the amounts then due on the Superior Indebtedness
      until the Superior Indebtedness shall have been paid in full.

    

    In
      order
      that Lender may establish its right to prove claims and recover for its own
      account dividends based on the Subordinated Indebtedness, Creditor does hereby
      assign all its right, title, and interest in such claims to Lender. Creditor
      further agrees to supply such information and evidence, provide access to and
      copies of such of Creditor’s records as may pertain to the Subordinated
      Indebtedness, and execute such instruments as may be required by Lender to
      enable Lender to enforce all such claims and collect all dividends, payments,
      or
      other disbursements which may be made on account of the Subordinated
      Indebtedness. For such purposes, Creditor hereby irrevocably authorizes Lender
      in its discretion to make and present for or on behalf of Creditor such proofs
      of claims on account of the Subordinated Indebtedness as Lender may deem
      expedient and proper and to vote such claims in any such proceeding and to
      receive and collect any and all dividends, payments, or other disbursements
      made
      thereon in whatever form the same may be paid or issued and to apply the same
      on
      account of the Superior Indebtedness.

    

    Should
      any payment, distribution, security, or proceeds thereof be received by Creditor
      at any time on the Subordinated Indebtedness contrary to the terms of this
      Agreement, Creditor immediately will deliver the same to Lender in precisely
      the
      form received (except for the endorsement or assignment of Creditor if
      necessary), for application on or to secure the Superior Indebtedness, whether
      it is due or not due, and until so delivered the same shall be held in trust
      by
      Creditor as property of Lender. In the event Creditor fails to make any such
      endorsement or assignment, Lender, or any of its officers on behalf of Lender,
      is hereby irrevocably authorized by Creditor to make the same.

    

    CREDITOR’S
      NOTES.
      Creditor agrees to deliver to Lender, at Lender’s request, all notes of Borrower
      to Creditor, or other evidence of the Subordinated Indebtedness, now held or
      hereafter acquired by Creditor, while this Agreement remains in effect. At
      Lender’s request, Borrower also will execute and deliver to Creditor a
      promissory note evidencing any book account or claim now or hereafter owed
      by
      Borrower to Creditor, which note also shall be delivered by Creditor to Lender.
      Creditor agrees not to sell, assign, pledge or otherwise transfer any of such
      notes except subject to all the terms and conditions of this
      Agreement.

    

    CREDITOR’S
      REPRESENTATIONS AND WARRANTIES.
      Creditor represents and warrants to Lender that: (A) no representations or
      agreements of any kind have been made to Creditor which would limit or qualify
      in any way the terms of this Agreement; (B) this Agreement is executed at
      Borrower’s request and not at the request of Lender; (C) Lender has made no
      representation to Creditor as to the creditworthiness of Borrower; and (D)
      Creditor has established adequate means of obtaining from Borrower on a
      continuing basis information regarding Borrower’s financial condition. Creditor
      agrees to keep adequately informed from such means of any facts, events, or
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      
        	
                 

              	
                SUBORDINATION
                  AGREEMENT

              	 
	
                Loan
                  No 12030954-10000-

              	
                (Continued)

              	
                Page 
                  2   

              

      

       

        
          

        

      

    

     

    circumstances
      which might in any way affect Creditor’s risks under this Agreement, and
      Creditor further agrees that Lender shall have no obligation to disclose to
      Creditor information or material acquired by Lender in the course of its
      relationship with Borrower.

    

    CREDITOR’S
      WAIVERS.
      Creditor waives any right to require Lender: (A) to make, extend, renew, or
      modify any loan to Borrower or to grant any other financial accommodations
      to
      Borrower whatsoever; (B) to make any presentment, protest, demand, or notice
      of
      any kind, including notice of any nonpayment of the Superior Indebtedness or
      of
      any nonpayment related to any Security Interests, or notice of any action or
      nonaction on the part of Borrower, Lender, any surety, endorser, or other
      guarantor in connection with the Superior Indebtedness, or in connection with
      the creation of new or additional Superior Indebtedness; (C) to resort for
      payment or to proceed directly or at once against any person, including
      Borrower; (D) to proceed directly against or exhaust any Security Interests
      held
      by Lender from Borrower, any other guarantor, or any other person; (E) to give
      notice of the terms, time, and place of any public or private sale of personal
      property security held by Lender from Borrower or to comply with any other
      applicable provisions of the Uniform Commercial Code; (F) to pursue any other
      remedy within Lender’s power; or (G) to commit any act or omission of any kind,
      at any time, with respect to any matter whatsoever.

    

    LENDER’S
      RIGHTS.
      Lender
      may take or omit any and all actions with respect to the Superior Indebtedness
      or any Security Interests for the Superior Indebtedness without affecting
      whatsoever any of Lender’s rights under this Agreement. In particular, without
      limitation, Lender may, without notice of any kind to Creditor, (A) make one
      or
      more additional secured or unsecured loans to Borrower; (B) repeatedly alter,
      compromise, renew, extend, accelerate, or otherwise change the time for payment
      or other terms of the Superior Indebtedness or any part thereof, including
      increases and decreases of the rate of interest on the Superior Indebtedness;
      extensions may be repeated and may be for longer than the original loan term;
      (C) take and hold Security Interests for the payment of the Superior
      Indebtedness, and exchange, enforce, waive, and release any such Security
      Interests, with or without the substitution of new collateral; (D) release,
      substitute, agree not to sue, or deal with any one or more of Borrower’s
      sureties, endorsers, or guarantors on any terms or manner Lender chooses; (E)
      determine how, when and what application of payments and credits, shall be
      made
      on the Superior Indebtedness; (F) apply such security and direct the order
      or
      manner of sale thereof, as Lender in its discretion may determine; and (G)
      assign this Agreement in whole or in part.

    

    DEFAULT
      BY BORROWER.
      If
      Borrower becomes insolvent or bankrupt, this Agreement shall remain in full
      force and effect. Any default by Borrower under the terms of the Subordinated
      Indebtedness also shall constitute an event of default under the terms of the
      Superior Indebtedness in favor of Lender.

    

    DURATION
      AND TERMINATION.
      This
      Agreement will take effect when received by Lender, without the necessity of
      any
      acceptance by Lender, in writing or otherwise, and will remain in full force
      and
      effect until Creditor shall notify Lender in writing at the address shown above
      to the contrary. Any such notice shall not affect the Superior Indebtedness
      owed
      Lender by Borrower at the time of such notice, nor shall such notice affect
      Superior Indebtedness thereafter granted in compliance with a commitment made
      by
      Lender to Borrower prior to receipt of such notice, nor shall such notice affect
      any renewals of or substitutions for any of the foregoing. Such notice shall
      affect only indebtedness of Borrower to Lender arising after receipt of such
      notice and not arising from financial assistance granted by Lender to Borrower
      in compliance with Lender’s obligations under a commitment. Any notes lodged
      with Lender pursuant to the section titled “Creditor’s Notes” above need not be
      returned until this Agreement has no further force or effect.

    

    OTHER
      TERMS AND CONDITIONS.
      The
      following provisions are a part of this Agreement: Payments permitted as
      follows:

    

    10.0%
      per
      annum payable quarterly, at the option of SBON (“Siboney Corporation”), either
      in cash or by issuance of additional Notes (“Notes”)
      with a principal
      amount equal to the interest payment then due; interest would increase by 2%
      per
      annum during the pendency of an event of default.

    

    ISDA.
      Obligations include, without limitation all obligations and liabilities arising
      pursuant to or in connection with any interest rate swap transaction, basis
      swap, forward rate transaction, interest rate option or any similar transaction
      between the Borrower and Lender, including all obligations under the ISDA Master
      Agreement between the Borrower and Lender.

    

    MISCELLANEOUS
      PROVISIONS.
      The
      following miscellaneous provisions are a part of this Agreement:

    

    Amendments.
      This
      Agreement, together with any Related Documents, constitutes the entire
      understanding and agreement of the parties as to the matters set forth in this
      Agreement. No alteration of or amendment to this Agreement shall be effective
      unless given in writing and signed by the party or parties sought to be charged
      or bound by the alteration or amendment.

    

    Attorneys’
      Fees; Expenses.
      Creditor agrees to pay upon demand all of Lender’s costs and expenses, including
      Lender’s attorneys’ fees and Lender’s legal expenses, incurred in connection
      with the enforcement of this Agreement. Lender may hire or pay someone else
      to
      help enforce this Agreement, and Creditor shall pay the costs and expenses
      of
      such enforcement. Costs and expenses include Lender’s attorneys’ fees and legal
      expenses whether or not there is a lawsuit, including attorneys’ fees and legal
      expenses for bankruptcy proceedings (including efforts to modify or vacate
      any
      automatic stay or injunction), and appeals. Creditor also shall pay all court
      costs and such additional fees as may be directed by the court.

    

    Authority.
      The
      person who signs this Agreement as or on behalf of Creditor represents and
      warrants that he or she has authority to execute this Agreement and to
      subordinate the Subordinated Indebtedness and the Creditor’s security interests
      in Creditor’s property, if any.

    

    Caption
      Headings.
      Caption
      headings in this Agreement are for convenience purposes only and are not to
      be
      used to interpret or define the provisions of this Agreement.

    

    Governing
      Law. This Agreement will be governed by federal law applicable to Lender and,
      to
      the extent not preempted by federal law, the laws of the State of Missouri
      without regard to its conflicts of law provisions. This Agreement has been
      accepted by Lender in the State of Missouri.

    

    Choice
      of Venue.
      If
      there is a lawsuit, Creditor agrees upon Lender’s request to submit to the
      jurisdiction of the courts of St Louis County, State of Missouri.

    

      
         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  SUBORDINATION
                    AGREEMENT

                	 
	
                  Loan
                    No 12030954-10000-

                	
                  (Continued)

                	
                  Page  3  
                    

                

        

         

          
            

          

        

      

       

    

    Interpretation.
      In all
      cases where there is more than one Creditor, then all words used in this
      Agreement in the singular shall be deemed to have been used in the plural where
      the context and construction so require; and where there is more than one
      Creditor named in this Agreement or when this Agreement is executed by more
      than
      one, the words “Creditor” shall mean all and any one or more of them. Reference
      to the phrase “Creditor” includes the heirs, successors, assigns, and
      transferees of each of them. All of the obligations of Creditor under this
      Agreement (if more than one) shall be joint and several.

    

    Successors
      and Assigns.
      This
      Agreement shall be understood to be for the benefit of Lender and for such
      other
      person or persons as may from time to time become or be the holder or owner
      of
      any of the Indebtedness or any interest therein, and this Agreement shall be
      transferable to the same extent and with the same force and effect as any such
      Indebtedness may be transferable.

    

    No
      Waiver by Lender.
      Lender
      shall not be deemed to have waived any rights under this Agreement unless such
      waiver is given in writing and signed by Lender. No delay or omission on the
      part of Lender in exercising any right shall operate as a waiver of such right
      or any other right. A waiver by Lender of a provision of this Agreement shall
      not prejudice or constitute a waiver of Lender’s right otherwise to demand
      strict compliance with that provision or any other provision of this Agreement.
      No prior waiver by Lender, nor any course of dealing between Lender and
      Creditor, shall constitute a waiver of any of Lender’s rights or of any of
      Creditor’s obligations as to any future transactions. Whenever the consent of
      Lender is required under this Agreement, the granting of such consent by Lender
      in any instance shall not constitute continuing consent to subsequent instances
      where such consent is required and in all cases such consent may be granted
      or
      withheld in the sole discretion of Lender.

    

    DEFINITIONS.
      The
      following capitalized words and terms shall have the following meanings when
      used in this Agreement. Unless specifically stated to the contrary, all
      references to dollar amounts shall mean amounts in lawful money of the United
      States of America. Words and terms used in the singular shall include the
      plural, and the plural shall include the singular, as the context may require.
      Words and terms not otherwise defined in this Agreement shall have the meanings
      attributed to such terms in the Uniform Commercial Code:

    

    Agreement.
      The
      word “Agreement” means this Subordination Agreement, as this Subordination
      Agreement may be amended or modified from time to time, together with all
      exhibits and schedules attached to this Subordination Agreement from time to
      time.

    

    Borrower.
      The
      word “Borrower” means Siboney Learning Group, Inc.; and Siboney Corporation and
      includes all co-signers and co-makers signing the Note and all their successors
      and assigns.

    

    Creditor.
      The
      word “Creditor” means ________________.

    

    Indebtedness.
      The
      word “Indebtedness” means the indebtedness evidenced by the Note or Related
      Documents, including all principal and interest together with all other
      indebtedness and costs and expenses for which Borrower is responsible under
      this
      Agreement or under any of the Related Documents.

    

    Lender.
      The
      word “Lender” means Southwest Bank of St. Louis, its successors and
      assigns.

    

    Note.
      The
      word “Note” means the Note executed by Siboney Learning Group, Inc.; and Siboney
      Corporation in the principal amount of $1,125,000.00 dated March 21, 2007,
      together with all renewals of, extensions of, modifications of, refinancings
      of,
      consolidations of, and substitutions for the note or credit
      agreement.

    

    Related
      Documents.
      The
      words “Related Documents” mean all promissory notes, credit agreements, loan
      agreements, environmental agreements, guaranties, security agreements,
      mortgages, deeds of trust, security deeds, collateral mortgages, and all other
      instruments, agreements and documents, whether now or hereafter existing,
      executed in connection with the Indebtedness.

    

    Security
      Interest.
      The
      words “Security Interest” mean, without limitation, any and all types of
      collateral security, present and future, whether in the form of a lien, charge,
      encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop
      pledge, chattel mortgage, collateral chattel mortgage, chattel trust, factor’s
      lien, equipment trust, conditional sale, trust receipt, lien or title retention
      contract, lease or consignment intended as a security device, or any other
      security or lien interest whatsoever whether created by law, contract, or
      otherwise.

    

    Subordinated
      Indebtedness.
      The
      words “Subordinated Indebtedness” mean the indebtedness described in the section
      of this Agreement titled “Subordinated Indebtedness”.

    

    Superior
      Indebtedness.
      The
      words “Superior Indebtedness” mean the indebtedness described in the section of
      this Agreement titled “Superior Indebtedness”.

    

    BORROWER
      AND CREDITOR EACH ACKNOWLEDGE HAVING READ ALL THE PROVISIONS OF THIS
      SUBORDINATION AGREEMENT, AND BORROWER AND CREDITOR
      EACH AGREE TO ITS TERMS. THIS AGREEMENT IS DATED MARCH 21,
      2007.

    

    BORROWER:

    

    SIBONEY
      LEARNING GROUP, INC.

    
      

      
        	
                By:

              	/s/
William
                D. Edwards	 	 	
                By:

              	/s/
Rebecca
                Braddock	 
	 	
                William
                  D. Edwards, President of 

              	 	 	 	
                Rebecca
                  Braddock, Secretary of

              	 
	 	
                Siboney
                  Learning Group, Inc.

              	 	 	 	
                Siboney
                  Learning Group, Inc.

              	 

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
        

        
          	
                   

                	
                  SUBORDINATION
                    AGREEMENT

                	 
	
                  Loan
                    No 12030954-10000-

                	
                  (Continued)

                	
                  Page  4  
                    

                

        

         

          
            

          

        

      

       

      SIBONEY
        CORPORATION

      

      
        	
                By:

              	/s/
William
                D. Edwards	 	 	
                By:

              	/s/
Rebecca
                Braddock	 
	 	
                William
                  D. Edwards, President of 

              	 	 	 	
                Rebecca
                  Braddock, Secretary of

              	 
	 	
                Siboney
                  Learning Group, Inc.

              	 	 	 	
                Siboney
                  Learning Group, Inc.

              	 
	 	 	 	 	 	 	 
	CREDITOR:	 	 	 	 	 
	 	 	 	 	 	 	 
	
                X

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