Document:

Exhibit
10.4

** Certain information in this
exhibit has been omitted and has been filed separately with the Securities and
Exchange Commission pursuant to a confidential treatment request under Rule 24b-2
of the General Rules and Regulations under the Securities Exchange Act of 1934.

ASSET
PURCHASE AGREEMENT

This
Asset Purchase Agreement (“Agreement”) is entered into on this 15th day of
September, 2005 by and between NHCLC of San Antonio, Inc., a Delaware
corporation (“Seller”) on the one hand, and South Texas Horizons, L.P., a Texas
limited partnership (“Buyer”), Derek Wright, an individual, Scott Hardin, an
individual (“Hardin”), Robert Dupree, an individual and South Texas Horizons
GP, L.L.C., a Texas limited liability company (collectively “Partners”) on the
other hand.  Buyer and Seller are
hereinafter sometimes individually referred to as a “Party” or collectively as
the “Parties”.

WHEREAS,
Seller wishes to sell to Buyer substantially all of its assets related to its
computer training business located in San Antonio, Texas (the “Business”),
which includes the assets set forth on Exhibit “A” (the “Assets”) and Buyer’s
assumption of liabilities set forth on Exhibit “C” (the “Assumed Liabilities”);
and

WHEREAS,
Buyer desires to acquire the Assets and assume the Assumed Liabilities from
Seller; and

WHEREAS,
concurrent with the transaction described in this Agreement, Buyer desires to
become a franchisee of NHCLC, Inc. (“Franchisor”) in San Antonio, Texas, it
being understood that Franchisor is an affiliate of Seller.

NOW, THEREFORE, in
consideration of the covenants and agreements contained herein, the Parties
agree as follows:

1.             Purchase
of Assets; Excluded Assets; Closing Date:

(a)           Pursuant to the terms
and subject to the conditions set forth in this Agreement, Seller hereby agrees
to sell, grant, transfer, convey, assign and deliver the Assets to Buyer as of
the close of business on October 31, 2005 (the “Closing Date”), which may be
extended as set forth in Sections 4(h) and 4(i) below and subject to fulfillment
of each of the conditions set forth in Section 4 below.  The Assets shall include, without limitation,
all prepaid assets, furniture and fixed assets, inventory, license fees and
deposits, accounts receivable, employee obligations, the consumer business
(including the Consumer Training Obligations set forth in Section 4(d)),
customer lists and certain computer hardware and software associated with the
Business, all of which are set forth on Exhibit “A”.

(b)           The Assets shall not
include (i) an agreement between Seller’s affiliate and the [***], and (ii) an
agreement between Seller’s affiliate and the [***].  Notwithstanding the foregoing, Buyer shall be
entitled to deliver training under the agreements set forth in subsections (i)
and (ii) in its capacity as a New Horizons franchisee and shall be deemed the “selling
center” which shall entitle Buyer to receive customary revenue sharing offered
by the Enterprise Learning Solutions department of Seller’s affiliate.  The Parties acknowledge and agree that, other
than as otherwise expressly stated in this Agreement, no other assets, personal
or real property of Seller is included in this transaction, including but not
limited to, services previously provided by the regional

office of Seller’s
affiliate such as accounting, payroll, legal or other similar services, and
assets of any of Seller’s affiliates.

2.             Consideration:

(a)           In consideration for
the transfer of the Assets, Buyer shall, on the Closing Date:

(i)            pay to Seller the sum
of $250,000 (the “Purchase Price”), comprised of $125,000 in the form of a wire
transfer or cashier’s check to Seller and a promissory note of $125,000
executed by Buyer in favor of Seller in the form attached hereto as Exhibit “B”
(the “Promissory Note”) with a two (2) year term and a 7% annual interest rate;

(ii)           assume the Assumed
Liabilities which are set forth on Exhibit “C”, including the Training
Obligations and Consumer Training Obligations as defined in Section 4(d),
below; and

(iii)          execute a standard ten
(10) year franchise agreement with Franchisor for a territory to include San
Antonio, Corpus Christi, the Rio Grande Valley, Laredo and San Angelo, Texas
(the “Franchise Agreement”) and shall remit all fees to Franchisor which are
typically associated with such Franchise Agreement, including but not limited
to the payment of customary monthly fees, such as royalties and advertising
fees; [***]

[***]

[***]

[***]

[***]

[***]

(b)           Within thirty (30) days
following the Closing Date (the “Settlement Date”), Seller shall provide Buyer
with a summary of the accounts receivable (the “Financial Credits”), as well as
the accounts payable, open purchase orders and national training to be
delivered (the “Financial Obligations”) for the Business as of the Closing
Date, substantially in

 2
 

the form attached
hereto as Exhibit “D”.  In the event that
the targets for the Financial Credits and Financial Obligations described below
are not met, then Buyer shall be entitled to an adjustment to the Purchase
Price which shall be the greater of either of the following two alternative
adjustments, each of which shall be calculated as of the Closing Date:

(i)            if the accounts
payable for the Business are greater than [***], then the Purchase Price shall
be reduced by the difference between the accounts payable as of the Closing
Date and [***]; or

(ii)           if the subtraction of
the Financial Obligations from the Financial Credits results in a figure which
is less than [***], then the Purchase Price shall be reduced by the difference
between such figure and [***].

(iii)          Any adjustments to the
Purchase Price as described in Sections 2(b)(i) and 2(b)(ii), above, shall be
made within ten (10) days after the Settlement Date in the form of a refund of
the appropriate portion of the cash paid to Seller from Buyer on the Closing
Date.

3.             Taxes;
Access to Assets:  Buyer shall be
solely responsible for the payment of any and all taxes, excise and other
governmental charges or fees, if any, which are payable in connection with the
purchase of the Assets.  As of the
Closing Date, Buyer shall be entitled to full access to the Assets located at
Seller’s facility at 8200 IH 10 West, Suite 102, 103, 105 and 500, San Antonio,
Texas  78230 (the “San Antonio Facility”).

4.             Conditions Precedent to Closing; Covenants; Extension
of Closing Date:

(a)           Immediately upon the
execution of this Agreement and the re-approval of Seller by the Texas
Workforce Commission, Career Schools and Veterans Education Section (“TWC”),
Buyer shall submit an application to the TWC seeking approval for a change in
ownership of the Business and shall use its best efforts to expedite the
approval process, including providing all reasonably required information to
the TWC and paying any necessary fees associated with such approval.  Buyer agrees that it must obtain TWC approval
on or before the Closing Date.

(b)           On the Closing Date,
(i) Buyer and Franchisor shall execute the Franchise Agreement, provided that
Franchisor has filed a Uniform Franchise Offering Circular (“UFOC”) with the
U.S. Federal Trade Commission and such UFOC is effective and grants Franchisor
the right to sell franchises in Texas after any applicable waiting periods
(such date, after any applicable waiting periods, is hereafter the “Effective
Date”), (ii) the Parties shall execute the Bill of Sale which is attached
hereto as Exhibit “E” and the Sublease Agreement for the San Antonio Facility
which is attached hereto as Exhibit “F” and (iii) Seller shall take all steps
reasonably necessary to transfer the Assets to Buyer, including obtaining the
requisite consent of its landlord and its lenders.

(c)           Within sixty (60) days
after the Closing Date, Seller shall cause any UCC filings to be terminated or
otherwise released such that the Assets are unencumbered.

 3
 

(d)           Effective as of the Closing
Date, Buyer shall fulfill Seller’s obligations to customers for training which
has been purchased by such customers prior to the Closing Date but not yet
delivered as of the Closing Date, (the “Training Obligations”).  For purposes of this Agreement, the Training
Obligations shall include the obligations owed to those consumers who are
identified on Exhibit “G” (the “Consumer Training Obligations”).

(e)           Effective as of the
Closing Date, Buyer and Seller shall not solicit, recruit or hire any employees
of the other party, or the other party’s affiliates, for so long as the
Franchise Agreement remains in effect. 
The foregoing restriction shall apply to any current or future employees
of either party and for a period of one (1) year following the termination of
the employee’s employment with such party or such party’s affiliates, but shall
not apply to employees of either party who are terminated by such party.  Notwithstanding the foregoing, Buyer may
employ Susan Ford who is a former employee of Seller and such employment shall
not violate the terms of this covenant.

(f)            Any debts, liabilities
or obligations incurred by or actions, claims or lawsuits asserted against
either Buyer or Seller which relate to the operation of the Business on or
prior to the Closing Date will be the responsibility of Seller, except to the
extent that such matters arise from a breach of the Hardin Business
Representations (as defined and further described in Section 6(d), below).  Conversely, any debts, liabilities or
obligations incurred by or actions, claims or lawsuits asserted against either
Buyer or Seller which relate to the operation of the Business after the Closing
Date, including the Assumed Liabilities, the Training Obligations and the
Consumer Training Obligations, will be the responsibility of Buyer.

(g)           In the event that any
of the foregoing conditions are not completely satisfied on or before the
Closing Date, then such failure by the party responsible for fulfilling the
condition shall relieve the other party from any obligation to perform under
this Agreement.

(h)           The parties acknowledge
that in the event that the UFOC is not registered and declared effective as of
the Closing Date, thereby precluding Franchisor from executing the Franchise
Agreement, then the Closing Date shall be automatically extended to the
Effective Date.  Notwithstanding the
foregoing, if the Effective Date does not occur by April 1, 2006, then this
Agreement shall terminate without any liability to either Buyer or Seller.

(i)            The parties acknowledge
that in the event that Buyer does not obtain TWC approval as of the Closing
Date, thereby precluding Buyer from assuming the Consumer Training Obligations,
then the Closing Date shall be automatically extended to either the Effective
Date or the last day of the month in which TWC approval is obtained, whichever
is later. Notwithstanding the foregoing, if the TWC approval is not obtained by
Buyer on or before April 1, 2006, then this Agreement shall terminate without
any liability to either Buyer or Seller.

5.             Representations
and Warranties of Seller:  Seller
represents, warrants and covenants to the best of its knowledge as follows:

(a)           Seller is a Delaware
corporation, duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all necessary corporate powers to own its
assets and to operate its business as now owned and operated by it.

 4
 

(b)           Seller has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement.

(c)           Seller has good and
marketable title to all of the Assets, and, except as otherwise indicated
herein, such Assets are free and clear of any restrictions or conditions to
sale, conveyance or transfer and are free and clear of all liens, mortgages, pledges,
encumbrances, leases, agreements, rental agreements, charges, claims, security
interests, taxes, conditions or restrictions of any nature or description
whatsoever.   The Assets are in good
working condition, ordinary wear and tear excepted.  Except as otherwise expressly provided
herein, the Assets are being sold “as is, where is” without any express or
implied warranties whatsoever.

(d)           Seller warrants that
expense entries for courseware, Online LIVE and Online ANYTIME contained in
Seller’s historical financial statements reflect charges which are the same as
the amounts charged to New Horizons franchisees for the same items.

(e)           Seller shall execute
all documents and take all steps reasonably necessary to transfer the Assets to
Buyer effective as of the Closing Date.

(f)            Seller makes no
representations or warranties regarding the quality of the accounts receivable,
including whether such accounts are collectible.

(g)           To the best of Seller’s
actual knowledge:

(i)            there is no material
liability, claim, deficiency, guarantee or obligation (absolute, accrued, contingent or otherwise), and there is no
basis for any such liability or obligation with regard to the Business;

(ii)           each contract which is material to the
operation of the Business is in full
force and effect there no defaults under any such contracts, nor have any
events occurred that with the lapse of time or the giving of notice or both
would constitute a default thereunder;

(iii)          the Business is in material compliance in all
respects with all applicable laws respecting employment, employment practices,
employee classification, labor relations, family and medical leaves, military
leaves, leaves of absence generally, safety and health, wages, hours and terms
and conditions of employment, and all wages, salaries, commissions, bonuses,
benefits and other compensation due and payable to all employees of the
Business under any policy, practice, agreement, plan, program or any statute or
other law for services performed through the Closing Date have been paid;

(iv)          except as otherwise expressly set forth in
this Agreement, all licenses which are necessary for the operation of
the Business are, and will be immediately after the Closing, valid and in full
force and effect and enforceable, and such licenses are sufficient to permit
the Business to be operated in its condition as of the Closing Date;

 5
 

(v)           the Business is in material compliance with
all applicable federal, state and local statutes, laws, rulings and ordinances
and Seller has no knowledge of circumstances which are likely to result in
material violations of any of the foregoing; and

(vi)          there are no claims, actions, suits,
proceedings, or investigations pending or threatened nor any unsatisfied
judgments or outstanding orders, injunctions, decrees, stipulations or awards
(whether rendered by a court or administrative agency or by arbitration), at
law, equity or otherwise, which involve the Business.

6.             Representations
of Buyer and Partners:  Buyer
represents, warrants and covenants as follows:

(a)           Buyer is a limited
partnership duly organized, validly existing and in good standing under the
laws of the State of Texas.  Partners
represent that they collectively own 100% of the issued and outstanding
partnership interests of Buyer.

(b)           Buyer has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement and the execution of this Agreement has been duly
authorized by Partners.

(c)           As of the Closing Date,
Buyer will duly observe and assume full responsibility for the Assumed
Liabilities and the Training Obligations, and shall assume possession and
ownership of the Assets.

(d)           Buyer and Seller
acknowledge that Hardin has served as the General Manager of the Business prior
to the Closing Date and has been responsible for managing its day to day
affairs and operations and, therefore, Hardin and Buyer jointly and severally
represent and warrant to Seller that, as of the Closing Date and to the best of
Hardin’s Knowledge (which is defined as matters which Hardin actually knows)
(all of the following representations and warranties are collectively
hereinafter referred to as the “Hardin Business Representations”):

(i)            there is no material
liability, claim, deficiency, guarantee or obligation (absolute, accrued, contingent or otherwise), and there is no
basis for any such liability or obligation with regard to the Business;

(ii)           each contract which is material to the
operation of the Business is in full
force and effect there no defaults under any such contracts, nor have any
events occurred that with the lapse of time or the giving of notice or both
would constitute a default thereunder;

(iii)          the Business is in material compliance in all
respects with all applicable laws respecting employment, employment practices,
employee classification, labor relations, family and medical leaves, military
leaves, leaves of absence generally, safety and health, wages, hours and terms
and conditions of employment, and all wages, salaries, commissions, bonuses,
benefits and other compensation due and payable to all employees of the
Business under any policy, practice, agreement, plan, program or any statute or
other law for services performed through the Closing Date have been paid;

 6
 

(iv)          except as otherwise expressly set forth in
this Agreement, all licenses which are necessary for the operation of
the Business are, and will be immediately after the Closing, valid and in full
force and effect and enforceable, and such licenses are sufficient to permit
the Business to be operated in its condition as of the Closing Date;

(v)           the Business is in material compliance with
all applicable federal, state and local statutes, laws, rulings and ordinances
and Hardin has no knowledge of circumstances which are likely to result in
material violations of any of the foregoing; and

(vi)          there are no claims, actions, suits,
proceedings, or investigations pending or threatened nor any unsatisfied
judgments or outstanding orders, injunctions, decrees, stipulations or awards
(whether rendered by a court or administrative agency or by arbitration), at
law, equity or otherwise, which involve the Business.

7.             Indemnification:

(a)           Buyer shall indemnify,
hold harmless and defend Seller, its parent company, affiliates, officers,
agents and employees from and against any cause of action, claim, loss or
liability arising out of or resulting in any way from: (i) the negligent acts
or omissions of Buyer’s officers, employees, agents or partners; (ii) any
breach or inaccuracy of any representation, warranty or covenant of Buyer or
Hardin set forth in this Agreement, including but not limited to, any of the
Hardin Business Representations; (iii) any debts, claims, liabilities or
lawsuits which relate to the use or operation of the Business or the Assets
after the Closing Date; and (iv) the failure to fully and adequately assume the
Assumed Liabilities, including the Training Obligations.  If after ten 
(10) days from receipt of written notice the Buyer fails to defend the
Seller as required above, Seller will have the right (but not the obligation)
to undertake the defense, compromise or settlement of such action on behalf of,
and for the account and at the risk of Buyer.

(b)           Seller shall indemnify,
hold harmless and defend Buyer, its affiliates, officers, agents, Partners and
employees from and against any cause of action, claim, loss or liability
arising out of or resulting in any way from: (i) the negligent acts or
omissions of Seller’s officers, employees, agents or partners; (ii) any breach
or inaccuracy of any representation, warranty or covenant of Seller, except for
claims which arise from a breach of the Hardin Business Representations, which
claims are expressly excluded from Seller’s duty to indemnify Buyer and/or
Partners; (iii) a breach of the terms of the existing sublease agreement
between Seller (as sublessor) and MS2, Inc. (as sublessee) for suite 120 of the
original Lease Agreement; and (iv) any debts, claims, liabilities or lawsuits
which relate to the use or operation of the Business or the Assets prior to the
Closing Date, except to the extent that such matters arise from a breach of the
Hardin Business Representations.  If
after ten  (10) days from receipt of
written notice the Seller fails to defend the Buyer as required above, Buyer
will have the right (but not the obligation) to undertake the defense,
compromise or settlement of such action on behalf of, and for the account and
at the risk of Seller.

8.             Insurance:  Buyer agrees to maintain general liability
insurance in the amounts of $1,000,000 per claim and $1,000,000 in the
aggregate, and upon written request Buyer will provide Seller with certificates
of insurance naming Seller or its affiliated companies as

 7
 

additional
insureds, in order to ensure that Buyer is able to meet its indemnification obligations
hereunder.  Notwithstanding any provision
to the contrary, to the extent permitted by law, Buyer may satisfy, in whole or
in part, the insurance requirements of this Agreement by a plan of self
insurance.

9.             Customer
Records: The Parties will maintain
the confidentiality of all customer records and files in accordance with
applicable federal and state laws and regulations.  On the Closing Date, Seller agrees to
transfer to Buyer all original customer records and files that relate to the
purchase and delivery of computer training for the Business, including the
files which relate to the Consumer Training Obligations.  In the event that Seller is audited by any
federal, state or local entity following the Closing Date, Buyer shall provide
Seller or its designees with reasonable access, during normal business hours,
to all original customer files related to the Assets.

10.          Notices:  All notices with respect to this Agreement
will be sent by certified mail or facsimile, to the following addresses or facsimile
numbers:

If to Seller:

NHCLC of San Antonio,
Inc.

Attention:  Office of General Counsel

1900 S. State College
Blvd., Suite 200

Anaheim, CA  92806

Tel:  (714) 940-8000

Fax:  (714) 938-6007

If to Buyer:

South Texas Horizons,
L.P.

c/o South Texas Horizons
GP, LLC

Attention:  Derek Wright, President

4515 Seton Center
Parkway, Suite 250

Austin, TX  78759

Tel:  (512) 349-9555 ext. 2401

Fax: (512)
349-2047

11.          Entire
Agreement; Assignment:  Except for the Franchise Agreement and
related agreements which are being executed concurrently herewith, this
Agreement and the exhibits attached hereto represent the entire agreement
between the Parties and are binding on each Party’s respective successors,
heirs and assigns.  This Agreement may
not be assigned without the written consent of the other party, and may only be
amended by a written agreement signed by authorized representatives of both
Parties.

12.          Waiver:  The failure of either party to
enforce any right, remedy or condition of this Agreement shall not be deemed a
waiver thereof nor shall it void or otherwise affect its right to enforce the
same right, remedy or condition at any subsequent time.

 8
 

13.          Survival
of Representations and Warranties:  The representations and
warranties set forth in this Agreement shall survive and continue until the
expiration of the applicable statute of limitations.

14.          Counterparts:  This Agreement may be executed in one or more
counterpart, each of which shall be deemed an original, and all of which
together shall constitute but one and the same instrument.

15.          Facsimile
Signatures:  For purposes of
execution of this Agreement, faxed signature pages shall be deemed the same as
original signature pages.

16.          Governing
Law; Venue:  This Agreement will be governed by
the laws of the State of Texas.  The
venue for any disputes arising under this Agreement shall be Bexar County,
Texas.

17.          Severability:  If any provision of this Agreement is
held invalid or unenforceable by a court of competent jurisdiction, that
provision will be deemed to be restated to reflect as nearly as possible the
original intentions of the parties in accordance with applicable law.  The remaining provisions of this Agreement
will be valid and enforceable to the full extent permitted by law.

 9
 

IN
WITNESS WHEREOF, the Parties have executed this Agreement as
of the date first written above.

	
  NHCLC OF SAN ANTONIO, INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Thomas J. Bresnan

  	
   

  	
   

  
	
   

  	
  Chief Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SOUTH TEXAS HORIZONS, L.P.

  
	
   

  
	
  By:

  	
  SOUTH TEXAS HORIZONS GP, LLC

  	
   

  	
   

  
	
   

  	
  Its General Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Derek Wright

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PARTNERS:

  
	
   

  
	
  SOUTH TEXAS HORIZONS GP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Derek Wright

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Derek Wright

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Scott Hardin

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Robert Dupree

  	
   

  	
   

  
					

 

 10
 

EXHIBIT “A”

Assets

1.             The following assets are included in the sale of
the Business:

	
  Trade Accounts Receivable

  	
   

  	
  $ 

  	
  564,190.00 

  	
  (1)

  
	
  ELS Accounts Receivable

  	
   

  	
  $

  	
  20,277.00

  	
   

  
	
  Prepaid Rent:

  	
   

  	
  $

  	
  46,695.00

  	
   

  
	
  Accrued Sylvan Test Rebates

  	
   

  	
  $

  	
  1,503.00

  	
   

  
	
  Other Prepaid Expenses:

  	
   

  	
  $

  	
  15,177.00

  	
   

  
	
  Inventory – Student Kits:

  	
   

  	
  $

  	
  43,016.00

  	
  (2)

  
	
  Inventory – Test Vouchers:

  	
   

  	
  $

  	
  8,875.00

  	
  (2)

  
	
  Inventory – Manuals:

  	
   

  	
  $

  	
  5,225.00

  	
  (2)

  
	
  Security Deposits:

  	
   

  	
  $

  	
  10,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Fixed Assets

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Leasehold Improvements:

  	
   

  	
  $

  	
  98,621.00

  	
  (3)

  
	
  Capitalized Computer Software:

  	
   

  	
  $

  	
  75,971.00

  	
  (4)

  
	
  Furniture & Fixtures:

  	
   

  	
  $

  	
  165,558.00

  	
  (5)

  
	
  Computer
  Equipment:

  	
   

  	
  $

  	
  454,580.00

  	
  (6)

  

 

Buyer and Seller acknowledge
that the assets listed above have been calculated as of June 30, 2005.  Buyer and Seller agree to revise these assets
within thirty (30) days of the Closing Date to reflect the actual operations of
the Business as of the Closing Date.

(1)           represents gross accounts receivable against
which Seller applies a reserve for futures of $299,388.00, a reserve for voids
of $18,642.00 and a reserve for bad debt of $1,670.00

(2)           represent gross inventory valuations against
which Seller applies a reserve for obsolete inventory of $1,501.00

(3)           represents gross fixed asset cost against which
Seller has accumulated depreciation/amortization of $23,394.00

(4)           represents gross fixed asset cost against which
Seller has accumulated depreciation/amortization of $54,273.00

(5)           represents gross fixed asset cost against which
Seller has accumulated depreciation/amortization of $124,856.00

(6)           represents
gross fixed asset cost against which Seller has accumulated
depreciation/amortization of $346,446.00

2.             Telephone and fax numbers used for the Business.

3.             Customer lists.

4.             Goodwill of the Business.

 11
 

5.             Covenant not to compete from Seller regarding the
San Antonio territory, to be contained in the franchise agreement between Buyer
and Seller’s affiliate

6.             Domain name “nhsanantonio.com”

 12
 

EXHIBIT “B”

PROMISSORY
NOTE AND GUARANTY

	
  $125,000

  	
   

  	
                  ,
  2005

  

 

FOR
VALUE RECEIVED, the undersigned (“Maker”), hereby promises to pay to the order
of NHCLC of San Antonio, Inc., a Delaware corporation (“New Horizons”), or
order, the sum of one hundred and twenty five thousand dollars ($125,000.00), together with interest on the unpaid
principal balance hereof at the rate of 7% per annum, which principal and
accrued interest shall be due and payable in
twenty-four equal monthly installments of $5,596.57 each,
commencing forty-five (45) days after the date of this Promissory Note and
continuing thereafter on the fifteen day of each month until the outstanding
principal balance and all unpaid accrued interest has been paid in full.

Maker reserves the right
to prepay all or any portion of this Promissory Note and Guaranty (“Promissory  Note”) at any time and from time to time
without premium or penalty of any kind by paying, in addition to the principal
amount of such prepayment, the interest accrued hereon to the date of such prepayment.

In the event that (a)
Maker shall default in the payment of principal or interest due hereunder and
such default shall continue for ten (10) days after the mailing of written
notice of such default to Maker at Maker’s last known address, or (b) a receiver
is appointed for Maker or any Guarantor or any part of Maker’s property, or (c)
Maker or any Guarantor makes any general assignment for the benefit of Maker’s
or any Guarantor’s creditors, or any proceeding is commenced by or against
Maker or any Guarantor or any other guarantor, surety, endorser, or person
directly or indirectly liable for any of the obligations hereunder, or (d)
Maker shall be deemed in default of the Franchise Agreement as of                       ,
2005 between Maker and NHCLCs, Inc. (“Franchisor”) (the events described in
subparts (a), (b), (c) and (d) are collectively referred to as Default”), the
holder of this Promissory Note at the time of the Default (the “Holder”) shall
have the right, if a Default occurs, to declare the outstanding principal
balance hereof and all unpaid accrued interest immediately due and payable in
full (the “Balance Due”).

If a Default occurs,
Maker and Guarantors also agree to pay upon demand all costs and expenses
reasonably incurred or paid at any time by Holder, including, but not limited
to, reasonable attorneys’ fees and other legal costs, in enforcing payment and
collection of the Balance Due of this Promissory Note.

Maker and Guarantors
agree: no delay or omission by Holder in exercising any of its rights or
remedies hereunder or otherwise shall impair any of such rights or remedies,
nor shall any such delay or omission be construed as a waiver of any Default
hereunder, and Holder may exercise every such right and remedy from time to
time as often as Holder may deem expedient; all rights and remedies of Holder
whether or not granted hereunder shall be cumulative and may be exercised
singularly or concurrently, and no such right or remedy is intended to be
exclusive of any other right or remedy of Holder; and no waiver by Holder of
any Default hereunder shall be

 13
 

effective unless in
writing and signed and delivered by Holder, and no such waiver or any default
shall extend to or affect any subsequent or other Default or impair any rights
or remedies of Holder.

This Promissory Note
shall be the joint and several obligation of Maker, Guarantors and all
guarantors, sureties, endorsers, and/or any other persons now or hereafter
liable hereon, if any, and shall be binding upon them and their heirs, executors,
personal representatives, successors and assigns.

Any demand upon or
notice of other communication to Maker and/or any Guarantor shall be effective
if delivered by hand delivery or deposited in the mails, postage prepaid,
addressed to Maker and/or any Guarantor at the address(es) of Maker and/or any
Guarantor as set forth in Holder’s records, or, if Maker and/or any Guarantor
has notified Holder of a change of address, to the last address of which Holder
has been so notified.

Maker and each
Guarantor, for Maker and each Guarantor and for any guarantors, sureties,
endorsers and/or any other persons now or hereafter liable hereon, if any,
hereby waive demand for payment, presentment for payment, protest, notice of
nonpayment or dishonor, and any and all other notices and demands whatsoever.

If any provision or
application of this Promissory Note is adjudicated to be invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provision or application of this Promissory Note that can be given effect
without the invalid or unenforceable provision or application.  Interest shall accrue hereunder at the lesser
of (a) the rate stated hereinabove, or (b) the maximum rate permitted by law.

For additional and other
value received, the existence, amount and sufficiency of which are hereby
acknowledged, the undersigned guarantor(s) (singly or collectively referred to
as “Guarantor”) jointly and severally hereby guarantees to Holder (a) the
immediate, absolute and unconditional payment of the Balance Due of this
Promissory Note after Default and (b) the immediate, absolute and unconditional
payment of all costs and expenses reasonably incurred or paid at any time by
Holder, including, but not limited to, reasonable attorneys’ fees and other legal
costs, in enforcing payment and collection of the Balance Due of this
Promissory Note.

This Promissory Note
shall be governed by, and construed and enforced in accordance with, the
internal laws of the Texas applicable to contracts made and to be performed
wholly within such state.

 14
 

IN
WITNESS WHEREOF, Maker and Guarantors
have executed and delivered this Promissory Note at the place specified above
and as of the date first written above.

	
  MAKER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SOUTH TEXAS
  HORIZONS, L.P.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  South Texas Horizons GP, LLC

  	
   

  	
   

  
	
   

  	
  Its General Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Derek Wright

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTORS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Derek Wright

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Scott Hardin

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Robert Dupree

  	
   

  	
   

  
					

 

 15

EXHIBIT “C”

Assumed
Liabilities

1.             Telephone system maintenance contract for phone
system located at the San Antonio Facility.

2.             Cellular and regular telephone numbers (with any
remaining service term assumed at Buyer’s expense).  4 cellular phones and one wireless Network
interface card.

3.             DSL computer line (with any remaining service
term assumed at Buyer’s expense).  Time
Warner T-1’s

4.             Training Obligations and Consumer Training
Obligations as more fully described in Section 4(d) and set forth on Exhibit “G”.

5.             Buyer shall assume those obligations which are
specifically listed below:

	
  Accounts Payable:

  	
   

  	
  $

  	
  80,256.00

  	
   

  
	
  Accrued Salaries & Wages:

  	
   

  	
  $

  	
  21,573.00

  	
   

  
	
  Accrued Bonuses:

  	
   

  	
  $

  	
  19,919.00

  	
   

  
	
  Accrued Vacations Payable:

  	
   

  	
  $

  	
  32,369.00

  	
   

  
	
  Accrued Commissions:

  	
   

  	
  $

  	
  64,931.00

  	
   

  
	
  Payable to other Franchisees:

  	
   

  	
  $

  	
  42,858.00

  	
   

  
	
  Other
  Accrued Liabilities:

  	
   

  	
  $

  	
  66,072.00

  	
   

  

 

Buyer and Seller acknowledge that the liabilities listed above have been
calculated as of June 30, 2005.  Buyer
and Seller agree to revise these obligations within thirty (30) days of the
Closing Date to reflect the actual operations of the Business as of the Closing
Date.

6.             On the Closing Date, Buyer shall terminate the
existing employees of the Business and shall offer employment to those
employees who Buyer wishes to employ, all at Buyer’s sole cost and
expense.  Buyer expressly agrees to
assume the liabilities set forth in item 5, above, which relate to the employee
obligations such as salaries & wages, bonuses, vacations and commissions.  Buyer further agrees to assume any liability
which may arise by virtue of such employee termination.

 16
 

EXHIBIT “D”

Financial
Credits and Financial Obligations

Attach:

  Fin Credits

    A/R

Fin Obligations

    A/P

    Outstanding PO’s

    National
Delivery

 17
 

EXHIBIT “E”

BILL OF
SALE

FOR GOOD AND VALUABLE CONSIDERATION,
the receipt of which is hereby acknowledged, the undersigned, NHCLC of San
Antonio, Inc., a Delaware corporation having its principal place of business at
1900 S. State College Blvd., Suite 200, Anaheim, CA  92806 (“Seller”) hereby sells, conveys,
transfers, assigns and delivers to South Texas Horizons, L.P., a Texas limited
partnership having an address at 4515 Seton Center Parkway, Suite 250, Austin,
TX  78759 (“Buyer”), all of its right,
title and interest in and to the Assets as such term is defined in that certain
Asset Purchase Agreement (“Agreement”), dated as of September 15, 2005, among
Buyer and Seller.

TO HAVE AND TO HOLD the same
unto Buyer, its successors and assigns forever.

This
Bill of Sale is delivered pursuant to and is subject to and governed by the
terms and conditions of the Agreement. The representations, warranties and
covenants as set forth in the Agreement shall survive delivery of this Bill of
Sale as set forth in the Agreement.

This Bill of Sale is
ancillary to the Agreement, and in the event of a conflict between the terms of
this Bill of Sale and the terms of the Agreement, the terms of the Agreement
shall govern.

IN
WITNESS WHEREOF, the undersigned has caused this instrument
to be duly executed as of the               
day of                       , 2005.

	
  NHCLC OF SAN ANTONIO, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Thomas J. Bresnan

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  

 

 18
 

EXHIBIT “F”

SUBLEASE
AGREEMENT

This
Sublease Agreement (the “Sublease”) is
made and entered into as of this              
day of                        , 2005,
by and between NHCLC of San Antonio, Inc., a Delaware corporation (“Sublessor”), and South Texas Horizons, L.P., a Texas limited
partnership  (“Sublessee”).

RECITALS

A.            Sublessor leases from
Fountainhead S.A. Corporation (“Landlord”) the
premises located at 8200 IH 10 West, Suite 102, Suite 103, Suite 105, Suite 120
and Suite 500, San Antonio, Texas  78230
(the “Premises”) pursuant to a lease agreement
dated the 12th day of January, 2001, as amended (the “Lease”)
attached hereto as Attachment 1;

B.            Sublessor currently
subleases Suite 120 of the Premises to a third party sublessee;

C.            Sublessor now wishes
to sublease the remaining portion of the Premises to Sublessee, and Sublessee
wishes to sublease the remaining portion of the Premises from Sublessor in
order for Sublessee to operate a NHCLC on the Premises, subject to the terms of
a franchise agreement between Sublessee and NHCLCs, Inc. dated the               
day of                        , 2005
(the “Franchise Agreement”); and

D.            Sublessee acknowledges
that it has received, reviewed, and approved the Lease.

The
parties agree as follows:

1.             SUBLEASE
TERM

1.1           Term.  Sublessor
hereby subleases Suites 102, 103, 105 and 500 of the Premises to Sublessee, and
Sublessee accepts such sublease, subject to the terms of this Sublease and
applicable provisions of the Lease.  The
Sublease shall commence on the              
day of                     , 2005
(“Sublease Commencement Date”) and shall
expire on the 30th day of June, 2011 (the “Sublease
Term”); provided, however, that the Sublease shall automatically
terminate upon the expiration or termination of the Franchise Agreement.

1.2           Conflict with Term
of Franchise Agreement.  Sublessor and Sublessee acknowledge that
the term of the Franchise Agreement may extend beyond the term available under
the Lease and that Sublessor cannot extend the term of this Sublease beyond the
remaining term under the Lease.  Sublessee
acknowledges that this Sublease may terminate due to the expiration of the
remaining term under the Lease for the Premises, prior to the expiration of the
Franchise Agreement.  Sublessee
acknowledges and agrees that in order to avoid an automatic termination of the
Franchise Agreement, it must negotiate a new direct lease with the Landlord for
the Premises, obtain a right to retain possession of the Premises or negotiate
a new direct lease with another landlord for adequate space in accordance with the
Franchise Agreement.

 19
 

2.             RENT

2.1           Monthly Rent.  Beginning
on the Sublease Commencement Date, Sublessee shall pay to Sublessor a monthly
rental payment (“Rent”) in accordance with the
schedule set forth below:

	
  Sublease Term

  	
   

  	
  Monthly Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Sublease
  Commencement Date through June 30, 2006

  	
   

  	
  $

  	
  38,758.55

  	
   

  
	
  July 1, 2006
  through June 30, 2007

  	
   

  	
  $

  	
  39,496.59

  	
   

  
	
  July 1, 2007
  through June 30, 2008

  	
   

  	
  $

  	
  40,341.30

  	
   

  
	
  July 1, 2008
  through June 30, 2009

  	
   

  	
  $

  	
  41,132.67

  	
   

  
	
  July 1, 2009
  through June 30, 2010

  	
   

  	
  $

  	
  41,924.04

  	
   

  
	
  July 1, 2010 through
  June 30, 2011

  	
   

  	
  $

  	
  42,715.42

  	
   

  

 

Sublessee shall
make payments of Rent at the address set forth below, due no later than the
tenth (10th) day of each month during the sublease Term; provided however, that
Sublessor shall pay the first month’s Rent due hereunder upon the execution of
this Sublease.

2.2           Additional Rent.  In
addition to the Rent described in this Section 2, Sublessee shall reimburse
Sublessor for its pro-rata share of the items defined as “Additional Rent” in
the manner and in the amounts expressly set forth in Section 4.2 of the
Lease.   For purposes of this Sublease,
the term “Rent” shall include “Additional Rent”.

2.3           Late Charge and
Interest.  Should Sublessee fail to pay any part of the Rent
required pursuant to this Lease within ten (10) days after the due date,
Sublessee shall pay to Sublessor a late charge of five percent (5%) of the
overdue amount as a late charge.  The
parties agree that this late charge represents a fair and reasonable estimate
of the costs that Sublessor will incur by reason of late payment by
Sublessee.  Acceptance of any late charge
shall not constitute a waiver of Sublessee’s default with respect to the
overdue amount, or prevent Sublessor from exercising any of the other rights
and remedies available to Sublessor.  In
addition, Rent not paid when due shall bear interest from the date due until
paid at the lesser of fifteen percent (15%) per year or the maximum rate
allowed by law.

2.4           Partial Months.  Rent
for partial months shall be pro rated on the basis of the actual number of days
in the month.

3.             PREMISES

3.1           Condition.  Sublessee
acknowledges that it has inspected the Premises and agrees to accept the
Premises “as is.”  Sublessee’s occupancy
of the Premises shall conclusively establish that the Premises were in
satisfactory condition at such time. 
Sublessor makes no representations as to: (a) the square footage of the
Premises, (b) the condition of the Premises, (c) the condition of any existing
tenant improvements, or (d) compliance with zoning or restrictive
covenants.   Sublessee shall, on the last
day of the Sublease term, or any extension thereof, or upon any earlier
termination of such term, surrender to Sublessor the Premises in good order,
condition and state of repair, reasonable wear and tear excepted.

 20
 

3.2           Maintenance and
Repair.     Sublessee shall, at its sole cost and
expense, perform the maintenance obligations and make any and all repairs or
replacements: (a) which Sublessor reasonably believes are required to be made
by Sublessor as Lessee under the Lease; (b) which are required by any law now
or hereafter affecting the Premises; or (c) which are required pursuant to the
terms of the Franchise Agreement.  If
Sublessee fails to maintain and repair the Premises, Sublessor may, on five (5)
days prior notice, enter the Premises and perform such repair and maintenance
on behalf of Sublessee.  However, in the
case of an emergency, Sublessor shall have immediate rights to enter the
Premises and perform such repair.  In
either case, Sublessee shall reimburse Sublessor for all reasonable costs so
incurred immediately upon demand.  It is
the intention of Sublessor and Sublessee, that at all times during the Sublease
term and any extension thereof, Sublessee shall maintain the Premises in an
attractive, fully operative condition. 
Sublessor shall have no responsibility hereunder to repair, maintain or
replace any portion of the Premises at any time.  Sublessee waives any benefit of any present
or future laws which might give Sublessee the right to repair the Premises at
Sublessor’s expense or to terminate the Sublease due to the condition of the
Premises.  Sublessee shall not commit any
waste.

3.3           Use.   Sublessee
shall not use the Premises for any purpose other than those outlined in Article
5 of the Lease.  Sublessee acknowledges
that neither Landlord, Sublessor, nor any agent acting on their behalf has made
any representation or warranty with respect to the suitability of the Premises
for the conduct of Sublessee’s business.

3.4           Tenant Improvements.  Sublessee
is solely responsible for the construction and costs of any leasehold
improvements desired by Sublessee, and the demolition of existing leasehold
improvements if necessary, including all permits, approvals, or the equivalent
thereof, required by a governmental agency. 
Sublessee shall not make any alterations or additions costing in the
aggregate more than twenty thousand dollars ($20,000) within any twelve (12)
month period or make any structural alterations without first obtaining the
written consent of Sublessor, subject to any additional requirements for
approval under the Lease.  Sublessee
shall give Sublessor at least thirty (30) days notice of any alterations or
additions so that Sublessor shall have the opportunity to post a notice of
non-responsibility, as may be provided for by local law.   Tenant’s 
alterations and additions shall be completed on the same terms and
conditions as contained in the Lease.

3.5           Signs.  Sublessee
shall erect only such signs on the Premises as are allowed by the Franchise
Agreement, where applicable, and the Lease.

4.             INSURANCE

4.1           Required Coverage.

(a)           Beginning on the
Commencement Date and continuing thereafter for the full terms, and any
extensions thereof, Sublessee shall maintain in full force and effect, at
Sublessee’s sole cost and expense, the various insurance coverages required to
be carried by Sublessee under the Franchise Agreement for the Premises;
provided, however, that if the

 21
 

amounts and types
of insurance coverages required pursuant to the terms of the Lease are greater,
Sublessee shall obtain insurance in such greater amounts or types.

(b)           Sublessee shall also
carry and pay for public liability insurance from a responsible insurance
company licensed to do business in the state in which the Premises are located
during the entire term of this Sublease in amounts not less than those required
by the Franchise Agreement.  Sublessee
shall deliver to Sublessor a certificate of insurance for each policy provided
for in this Section 4.  Sublessor shall
be shown as an additional insured and loss payee on such policies, which shall
not be canceled without thirty (30) days notice to Sublessor.

4.2           Waiver of
Subrogation.  Sublessor and Sublessee each waive their right to
sue and recover damages against each other with respect to any liability
arising under the Lease or this Sublease and which is required to be covered by
any insurance policy in the Lease or this Sublease.  Each party agrees to endeavor to cause its
insurer to waive its rights against the other party in the event of an insured
casualty which is not caused by the willful misconduct of the other party.

4.3           Sublessee’s Property.  Sublessee
shall be solely responsible for insuring its own property on the Premises.  Sublessor shall not be responsible for loss
or damage to the personal property of Sublessee, its sublessees, employees,
customers, or invitees, in the absence of the receipt of an insurance payment
by Sublessor attributable to such loss (in which event said payment shall be
delivered forthwith to Sublessee), or unless such loss or damage was occasioned
by the willful misconduct of Sublessor, its agents, servants, or employees; but
subject in any event to Section 4.2.

5.             DAMAGE TO
PREMISES AND CONDEMNATION

If
any part of the Premises is condemned or damaged by fire or other casualty
during the term of this Sublease, this Sublease shall remain in full force and
effect unless and until the Lease is terminated as outlined in Article 13 of
the Lease.  If the Lease is canceled for
such cause, Sublessee’s obligations under this Sublease shall abate as of the
date of such cancellation.  Otherwise,
Sublessee’s obligations shall abate only to the actual monetary extent and for
the duration that Sublessor’s obligations are reduced under the Lease.  In the event of a condemnation by eminent
domain, any award to the Sublessee shall belong to and be paid to Sublessor,
including any amount attributable to any leasehold interest, except that
Sublessee shall receive from the award a sum, if any, allocated for damage,
destruction or taking of Sublessee’s furniture, trade fixtures or equipment;
provided, however, that Sublessee is not in default hereunder.  Sublessee may also pursue and retain any
award from the condemning authority, payable solely and specifically to
Sublessee for the loss of Sublessee’s business.

6.             OBLIGATIONS
UNDER THE LEASE

6.1           Assumption by
Sublessee.  In addition to the terms, conditions and provisions
of this Sublease, Sublessee understands and agrees that this Sublease is
subject to each and all of the terms, conditions and provisions of the Lease
and of the rights of Landlord thereunder. 
Except as expressly provided in this Sublease, Sublessee expressly
assumes all of the responsibilities and obligations imposed upon Sublessor as
the tenant under the terms of the

 22
 

Lease.  In the event any inconsistency arises between
the Lease and this Sublease in the obligations of the Sublessee, the more
stringent obligations shall prevail.

6.2           Sublessor’s
Obligations.  Sublessor covenants to pay all amounts owed to
Landlord under the Lease to the extent Sublessee complies with its obligations
under this Sublease.  Sublessor
acknowledges that this Sublease shall not limit or impair Sublessor’s liability
to Landlord under the Lease.

6.3           Landlord’s
Obligations.  Sublessor shall not be liable to Sublessee for the
defaults of Landlord under the Lease.

7.             INDEMNITY

7.1           Generally.  Sublessee
shall indemnify, hold harmless, and defend Sublessor from all claims, costs,
damages, liabilities, and loss incurred by Sublessor, including reasonable
attorneys fees and costs of suit, as a result of Sublessee’s default under this
Sublease or the Lease, or as the result of any act or failure to act by
Sublessee, its agents, employees, customers, invitees, licensees, successors,
heirs, or assigns, or any and all persons coming upon or near the Premises with
regard to the Premises.

7.2           Hazardous Materials.  Sublessee
agrees to indemnify and hold Sublessor harmless from any and all costs of any
remedial action or cleanup of Hazardous Materials suffered or incurred by
Sublessor arising out of or related to Sublessee’s use of the Premises.  “Hazardous Materials”
means any hazardous, toxic, infectious, or radioactive substances, wastes, or
materials listed or defined by any federal or state environmental law.

8.             DEFAULT

8.1           Notice; Cure.  Sublessee
shall cure any failure to perform Sublessee’s obligations under this Sublease
or the Lease:  (a) within three (3) days
after receiving notice of any monetary default, or (b) within ten (10) days
after receiving notice of any non-monetary default, except that if Sublessee
cannot reasonably cure the non-monetary default within ten (10) days, Sublessee
shall have up to thirty (30) days to complete the cure, so long as Sublessee
proceeds with due diligence.  If
Sublessee fails to cure defaults during the grace periods specified above,
Sublessor shall have the right to declare a default under this Sublease.

8.2           Remedies.  Sublessor
shall have the following rights and remedies upon a default by Sublessee under
this Sublease:

(a)           Sublessor may terminate
this Sublease and upon such termination, Sublessor may recover from Sublessee
the amount by which the unpaid rent which would have been earned after
termination until the time that Sublessee proves such loss could have been
reasonably avoided; and

(b)           Sublessor may relet the
Premises prior to the breach of this Sublease by Sublessee.  In such case, if Sublessor proves that in
reletting the Premises it acted reasonably and

 23
 

in good faith to
mitigate damages, it shall be entitled to an award for Sublessee’s improper
termination of this Sublease.

(c)           Sublessor shall also
have the right, but not the obligation, to cure any default by Sublessee.  Sublessee shall repay any costs incurred by
Sublessor in doing so upon Sublessor’s written demand.  All amounts owed hereunder shall be
considered rent and shall bear interest at the rate of twelve percent (12%) per
annum or the maximum rate permitted by law, whichever is less, from ten (10)
days after such demand to the date of payment.

8.3           Franchise Agreement.  Sublessee’s
default under the Franchise Agreement or any other document related to
Sublessee’s operation of a NHCLC on the Premises, including any promissory
note, shall be deemed a default under this Sublease.  In addition, Sublessee’s default hereunder
shall constitute a default under the Franchise Agreement, and NHCLCs, Inc. may
terminate the Franchise Agreement in accordance with the terms thereof.

8.4           Remedies Cumulative.  The
remedies specified in this Sublease are cumulative and in addition to any other
remedies which may be available at law or in equity.

9.             ASSIGNMENTS

Sublessee
shall not assign or sublet the Premises, in full or in part without Sublessor’s
prior written consent in each instance, which Sublessor may withhold in its
sole discretion; provided, however, that if Landlord consents to any such
assignment or sublease, then Sublessor’s consent shall not be unreasonably
withheld.  Any assignment without the requisite
consents shall be void and shall, at the option of Sublessor, terminate this
Sublease.  The consent by Sublessor to
one assignment or subletting shall not be deemed to be consent to any
subsequent assignment or subletting.

10.           UTILITIES

Sublessee
is required to open and maintain utility accounts in its name for, and to pay,
prior to delinquency, all charges for telephone and data communications service
and all other services supplied to the Premises during the term of this
Sublease which are not otherwise provided by Landlord and listed in Article 6
of the Lease.

11.           NOTICES

11.1         Notices:  Any
and all notices furnished pursuant to this Sublease shall be in writing and
shall be personally delivered, sent by telecopier, mailed by certified mail,
return receipt requested, or dispatched by overnight delivery envelope to the
respective parties at the following addresses, unless and until a different
address has been designated by written notice to the other party:

	
  Notices to Sublessor:

  	
   

  	
  NHCLC of San Antonio, Inc.

  
	
   

  	
   

  	
  1900 S. State College Blvd., Suite 200

  
	
   

  	
   

  	
  Anaheim, CA 92806

  
	
   

  	
   

  	
  Attention: Legal Department

  

 

 24
 

 

	
  Notices to Sublessee:

  	
   

  	
  South Texas Horizons, L.P.

  
	
   

  	
   

  	
  8200 I-H 10 West, Suite 500

  
	
   

  	
   

  	
  San Antonio, TX 78230

  
	
   

  	
   

  	
  Attention: Derek Wright

  

 

Notices shall be
deemed to have been received as follows: 
by personal delivery or telecopier — at time of delivery; by overnight
delivery service — on the next business day following the date on which the
Notice was given to the overnight delivery service; and certified mail — three
days after the date of mailing.

11.2         Under Lease.  Sublessee
shall promptly provide Sublessor with a copy of all notices received from
Landlord regarding the Premises, the Lease, or this Sublease.

12.           HOLDOVER
TENANCY

At
the expiration of the Sublease, or earlier termination for any reason,
Sublessee shall immediately surrender possession of the Premises to
Sublessor.  Should Sublessee fail to do
so, it consents to pay any and all damages which Sublessor may suffer,
including attorneys’ fees, costs and expenses incurred by Sublessor to obtain
possession of the Premises.  Sublessee
expressly waives any notice to vacate at the expiration of the Sublease.  Should Sublessor allow or permit Sublessee to
remain in the Premises after the expiration or termination of this Sublease,
this shall not be construed as an extension of this Sublease, and such holding
over shall be deemed to have created a month-to-month tenancy, subject to all
the terms and conditions of this Sublease, except that Sublessee shall pay Rent
to Sublessor at a rate equal to one hundred fifty percent (150%) of the monthly
rental paid during the one (1) year period immediately preceding the expiration
of the Sublease

13.           LEGAL EXPENSES

In
the event either party brings an action against the other by reason of the
alleged breach or any term, covenant or condition of this Sublease, the
prevailing party shall be entitled to recover from the other party all legal
expenses, including reasonable attorneys’ fees, in an amount to be fixed by the
court rendering such judgment.  The
foregoing provision notwithstanding, in the event Sublessee shall be in default
under this Sublease, and shall cure such default after notice by Sublessor
pursuant to this Sublease, then all reasonable attorneys’ fees incurred by
Sublessor as a result of such default shall be paid by Sublessee.  Such attorneys’ fees shall be added to the
subsequent month’s Rent as additional Rent. 
Sublessee shall reimburse Sublessor, upon demand, for any costs or
expenses incurred by Sublessor in connection with any breach by or default of
Sublessee under this Sublease, whether or not suit is commenced or judgment
entered.  Such costs shall include legal
fees and costs incurred for the negotiation of a settlement, enforcement of
rights or otherwise.  Sublessee shall
also indemnify Sublessor for, and hold Sublessor harmless from and against, all
liabilities incurred by Sublessor if Sublessor becomes or is made a party to
any proceeding claim or action instituted: (a) by Sublessee; (b) by any third
party against Sublessee; (c) by or against any person holding an interest under
Sublessee or using the Premises by license of or agreement with Sublessee; (d)
for foreclosure of

 25
 

any lien for labor
and material furnished to or for Sublessee or such other person; or (e)
otherwise arising out of or resulting from any act or omission of Sublessee or
such other person.

14.           CONTROLLING
LAW; VENUE

This
Sublease shall be governed and construed in accordance with the laws of
Texas.  The parties agree that any action
brought by either party against the other in any court, whether federal or
state, will be brought exclusively within the State of Texas, except that,
Sublessor may, at Sublessor’s discretion, seek injunctive and equitable relief
in any court of competent jurisdiction in order to evict Sublessee or prevent
waste or other actions by Sublessee that will irreparably harm Sublessor.  Sublessee hereby irrevocably consents to the
jurisdiction of such court and waives any objection Sublessee may have to
either jurisdiction or venue of such court.

15.           ENTIRE
AGREEMENT

This Sublease
constitutes the entire agreement among the parties and supersedes any oral or
written understandings relating to the Lease or the Sublease.  This Sublease may be modified only by written
agreement between the parties or their successors subsequent to the date of
this Sublease.

 26
 

IN
WITNESS WHEREOF, the parties hereto have duly executed,
sealed, and delivered this Sublease as of the day and year written below. 

	
  SUBLESSOR

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  NHCLC OF SAN ANTONIO, INC.

  	
   

  	
   

  
	
  a Delaware corporation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Thomas J. Bresnan

  	
   

  	
   

  
	
   

  	
  Chief Executive Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SUBLESSE

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SOUTH TEXAS HORIZONS, L.P.

  	
   

  	
   

  
	
  a Texas limited partnership

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  SOUTH TEXAS HORIZONS GP, LLC

  	
   

  	
   

  
	
   

  	
  Its General Partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Derek Wright

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CONSENT TO THE FOREGOING SUBLEASE IS HEREBY GRANTED:

  
	
   

  	
   

  	
   

  
	
  LANDLORD

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  FOUNTAINHEAD S.A. CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
												

 

 27
 

ATTACHMENT
1

LEASE

 28
 

ATTACHMENT
2

PERSONAL
GUARANTEE

As
an inducement to NHCLC of San Antonio, Inc. (“Sublessor”)
to execute the Sublease (the “Sublease”) with South Texas Horizons, L.P. (“Sublessee”) and in consideration of Sublessor’s executing
the Sublease and of the sum of One Dollar ($1.00) now paid by Sublessor to
Guarantors, the receipt of which is hereby acknowledged, Guarantors jointly and
severally agree as follows:

1.             Guarantors shall pay
or cause to be paid to Sublessor all monies payable by Sublessee under the
Sublease on the days and times in the manner therein appointed for payment
thereof.

2.             Guarantors
unconditionally guarantee full performance and discharge by Sublessee of all
the obligations of Sublessee under the Sublease at the times and in the manner
therein provided.

3.             Guarantors shall
indemnify and save harmless Sublessor and its affiliates against and from all
losses, damages, costs, and expenses which Sublessor and its affiliates may
sustain, incur, or become liable for by reason of:

a.             the failure for any
reason whatsoever of Sublessee to pay the monies payable pursuant to the
Sublease or to do and perform any other act, matter or thing pursuant to the
provisions of the Sublease; or

b.             any act, action, or
proceeding of or by Sublessor, its agents, employees, etc. for or in connection
with the recovery of monies or the obtaining of performance by Sublessee of any
other act, matter or thing pursuant to the provisions of the Sublease.

4.             Sublessor shall not
be obligated to proceed against Sublessee or exhaust any security from
Sublessee or pursue or exhaust any remedy, including any legal or equitable
relief against Sublessee, before proceeding to enforce the obligations of the
Guarantors herein set out, and the enforcement of such obligations may take
place before, after, or contemporaneously with, enforcement of any debt or
obligation of Sublessee under the Sublease.

5.             Without affecting the
Guarantors’ obligations under this Guarantee, Sublessor may, after conferring
with Guarantors and providing them with ten (10) days advance written notice,
extend, modify, or release any indebtedness or obligation of Sublessee, or
settle, adjust, or compromise any claims against Sublessee.  Guarantors waive notice of amendment of the
Sublease and notice of demand for payment or performance by Sublessee.

6.             Guarantors’
obligations hereunder shall remain in full force and effect, and shall be
unaffected by:  (a) the bankruptcy,
insolvency, dissolution, or other liquidation of Sublessee, including, without
limitation, any surrender or disclaimer of the Sublease by the trustee in
bankruptcy of Sublessee; (b) Sublessor’s consent or acquiescence to any
bankruptcy, receivership, insolvency, or any other creditor’s proceedings of or
against Sublessee, or by the

 29
 

winding-up or
dissolution of Sublessee, or any other event or occurrence which would have the
effect at law of terminating the existence of Sublessee’s obligations prior to
the termination of the Sublease; or (c) by any other agreements or other
dealings between Sublessor and Sublessee 
having the effect of amending or altering the Sublease or Sublessee’s
obligations hereunder, or by any want of notice by Sublessor to Sublessee of
any default of Sublessee or by any other matter, thing, act, or omission of
Sublessor whatsoever.

7.             Provided that
Sublessee is not in default of the Sublease, this Guarantee shall terminate if
Sublessor and Landlord secure and mutually approve a new subtenant for all or
part of the Premises who is in good financial standing; provided, however, that
this Guarantee shall only terminate with regard to the future obligations of
such new subtenant for that part of the
Premises to be occupied by the subtenant and not with regard to
Sublessee’s obligations which are otherwise owed to Sublessor under the
Sublease.

8.             Notices to
Guarantors:

	
  Name

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
  Derek Wright 

  	
   

  	
  2947 Lantana
  Ridge Drive

  Austin, Texas 78732

  
	
   

  	
   

  	
   

  
	
  Scott Hardin 

  	
   

  	
  303 Harvest
  Garden

  Boerne, Texas 78006

  
	
   

  	
   

  	
   

  
	
  Robert Dupree 

  	
   

  	
  10223 Matoca Way

  Austin, Texas 78726

  

 

IN
WITNESS WHEREOF, each of the undersigned has signed this
Guarantee as of the day and year of the Sublease.

	
  GUARANTORS:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Derek Wright

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Scott Hardin

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Robert Dupree

  	
   

  

 

 30

EXHIBIT “G”

Consumer
Training Obligations

[***]

 31Exhibit
10.5

** Certain information in this
exhibit has been omitted and has been filed separately with the Securities and
Exchange Commission pursuant to a confidential treatment request under Rule 42b-2
of the General Rules and Regulations under the Securities Exchange Act of 1934.

ASSET
PURCHASE AGREEMENT

This Asset
Purchase Agreement (“Agreement”) is entered into on this 10th day of March,
2006 by and between New Horizons Computer Learning Center of Charlotte, Inc., a
Delaware corporation (“Seller”) on the one hand, and Sukothai, Inc.,  a North Carolina corporation (“Buyer”), and
Kimberly Pongpat, an individual (“Shareholder”) on the other hand.  Buyer, Shareholder and Seller are hereinafter
sometimes individually referred to as a “Party” or collectively as the “Parties”.

WHEREAS,
Seller wishes to sell to Buyer substantially all of its assets related to its
computer training business located in Charlotte, North Carolina (the “Business”),
which includes the assets set forth on Exhibit “A” (the “Assets”) and Buyer’s
assumption of liabilities set forth on Exhibit “B” (the “Assumed Liabilities”);
and

WHEREAS,
Buyer desires to acquire the Assets and assume the Assumed Liabilities from
Seller; and

WHEREAS,
concurrent with the transaction described in this Agreement, Buyer desires to
become a franchisee of New Horizons Franchising Group, Inc., or its affiliate (“Franchisor”)
in Charlotte, North Carolina, it being understood that Franchisor is an
affiliate of Seller.

NOW, THEREFORE, in
consideration of the covenants and agreements contained herein, the Parties
agree as follows:

1.             Purchase
of Assets; Excluded Assets; Closing Date:

(a)            Pursuant to the terms
and subject to the conditions set forth in this Agreement, Seller hereby agrees
to sell, grant, transfer, convey, assign and deliver the Assets to Buyer as of
the close of business on March 31, 2006 (the “Closing Date”), which shall be
automatically extended to allow for the fulfillment of each of the conditions
set forth in Section 4 below, but in no event beyond the period specified n
Section 4(h), below.  The Assets shall
include, without limitation, certain identified prepaid assets, furniture and
fixed assets, inventory, license fees and deposits, accounts receivable, certain
employee obligations, any consumer business, customer lists and certain
computer hardware and software associated with the Business, all of which are
set forth on Exhibit “A”.

(b)           The Parties acknowledge
and agree that, other than as otherwise expressly stated in this Agreement, no
other assets, personal or real property of Seller is included in this
transaction, including but not limited to, non-scheduled lease obligations,
services previously provided by the regional office of Seller’s affiliate such
as accounting, payroll, legal or other similar services, and assets of any of
Seller’s affiliates.

2.             Consideration:  In consideration for the transfer of the
Assets, Buyer shall, on the Closing Date:

(i)            pay to Seller the sum
of $75,000 (the “Purchase Price”), comprised of $37,500 in the form of a wire
transfer or cashier’s check to Seller and a promissory note of $37,500 executed
by Buyer in favor of Seller in the form attached hereto as Exhibit “E” (the “Promissory
Note”) with a one (1) year term and a 6% annual interest rate;

(ii)  execute a standard ten (10) year franchise
agreement with Franchisor for the Charlotte, North Carolina territory (the “Franchise
Agreement”) and shall remit all fees to Franchisor which are typically
associated with such Franchise Agreement, including but not limited to the
payment of customary monthly fees, such as royalties and advertising fees (but
exclusive of an initial franchise fee, which is already included in the cash
component of the consideration set forth in the preceding section) ; [***]

[***]

[***]

[***]

(iii)  assume the Assumed Liabilities which are set
forth on Exhibit “B”, including the Training Obligations as defined in Section
4(d), below.

3.             Taxes;
Access to Assets:  Buyer shall be
solely responsible for the payment of any and all taxes, excise and other
governmental charges or fees, if any, which are payable in connection with the
purchase of the Assets.  As of the
Closing Date, Buyer shall be entitled to full access to the Assets located at
Seller’s facility at 9140 Arrowpoint Blvd, Office Building No. 2, Charlotte,
North Carolina 28273 (the “Charlotte Facility”).

4.                                      Conditions Precedent to Closing; Covenants;
Extension of Closing Date:

(a)           Immediately upon the
execution of this Agreement, Buyer shall submit an application to the North
Carolina State Board of Community Colleges, Office of Proprietary Schools (“NCSBCC”)
seeking approval for a change in ownership of the Business and shall use its
best efforts to expedite the approval process, including providing all
reasonably required information to the NCSBCC and paying any necessary fees
associated with such approval.  Buyer
agrees that it must obtain approval on or before the Closing Date and in any
event no later than September 8, 2006. 
Upon approval of Buyer’s application, Buyer shall immediately post a
bond or cash deposit with the NCSBCC as required by applicable North Carolina
law so that Seller shall be entitled to receive a refund of $100,000 currently
held by NCSBCC.  Seller agrees 

 2
 

to cooperate with
and provide reasonable assistance to Buyer in connection with Buyer’s effort to
obtain NCSBCC approval.

(b)           On the Closing Date:
(i) Buyer and Franchisor shall execute the Franchise Agreement; (ii) the
Parties shall execute the Bill of Sale which is attached hereto as Exhibit “C”
and the Sublease Agreement for the Charlotte Facility which is attached hereto
as Exhibit “D”, provided that the Landlord for the Charlotte Facility has
granted its consent under the Sublease Agreement; (iii) Buyer shall execute the
promissory note which is attached hereto as Exhibit “E”; and (iv) Seller shall
take all steps reasonably necessary to transfer the Assets to Buyer, including
obtaining the requisite consent of its landlord and its lenders.

(c)           Within sixty (60) days
after the Closing Date, Seller shall cause any UCC filings to be terminated or
otherwise released such that the Assets are unencumbered.

(d)           Effective as of the
Closing Date, Buyer shall fulfill Seller’s obligations to customers for
training which has been purchased by such customers prior to the Closing Date
but not yet delivered as of the Closing Date, (the “Training Obligations”).  For purposes of this Agreement, the Training
Obligations shall include, but are not limited to, sold but unredeemed coupons,
unexpired club memberships, corporate seat licenses, unredeemed programs or
tracks, sold but undelivered training events (i.e., classes which were
purchased but not completed) and sold but undelivered room rental agreements.

(e)           Effective as of the
Closing Date, Buyer and Seller shall not solicit, recruit or hire any employees
of the other party, or the other party’s affiliates, for so long as the
Franchise Agreement remains in effect. 
The foregoing restriction shall apply to any current or future employees
of either party and for a period of one (1) year following the termination of
the employee’s employment with such party or such party’s affiliates, but shall
not apply to employees of either party who are terminated by such party.

(f)            Except as otherwise
set forth herein, any debts, liabilities or obligations incurred by or actions,
claims or lawsuits asserted against either Buyer or Seller which relate to the
operation of the Business on or prior to the Closing Date (excluding the
Assumed Liabilities and the Training Obligations) will be the responsibility of
Seller.  Conversely, any debts,
liabilities or obligations incurred by or actions, claims or lawsuits asserted
against either Buyer or Seller which relate to the operation of the Business
after the Closing Date, as well as the Assumed Liabilities and the Training
Obligations (regardless of when the Assumed Liabilities and Training
Obligations were incurred) will be the responsibility of Buyer.

(g)           In the event that any of
the foregoing conditions are not completely satisfied on or before the Closing
Date, then such failure by the party responsible for fulfilling the condition
shall relieve the other party from any obligation to perform under this
Agreement.

(h)           If the Closing Date
does not occur by September 8, 2006, then this Agreement shall terminate
without any liability to either Buyer or Seller.

 3
 

5.             Representations
and Warranties of Seller:  Seller
represents, warrants and covenants to the best of its knowledge as follows:

(a)            Seller is a Delaware
corporation, duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all necessary corporate powers to own its
assets and to operate its business as now owned and operated by it.

(b)           Seller has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement.

(c)            Seller has good and
marketable title to all of the Assets, and, except as otherwise indicated
herein, such Assets are free and clear of any restrictions or conditions to
sale, conveyance or transfer and are free and clear of all liens, mortgages,
pledges, encumbrances, leases, agreements, rental agreements, charges, claims,
security interests, taxes, conditions or restrictions of any nature or
description whatsoever.   The Assets are
in good working condition, ordinary wear and tear excepted.  Except as otherwise expressly provided
herein, the Assets are being sold “as is, where is” without any express or
implied warranties whatsoever.

(d)           There are no claims,
actions or lawsuits pending against Seller relating to the Assets.

(e)            Seller shall execute
all documents and take all steps reasonably necessary to transfer the Assets to
Buyer effective as of the Closing Date.

(f)            Seller makes no
representations or warranties regarding the quality of the accounts receivable,
including whether such accounts are collectible.

6.             Representations
of Buyer and Shareholder:  Buyer
and Shareholder represent, warrant and covenant as follows:

(a)            Buyer is a corporation
duly organized, validly existing and in good standing under the laws of the
State of North Carolina.  Shareholder
owns 100% of the issued and outstanding equity of Buyer.

(b)           Buyer has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement and the execution of this Agreement has been duly
authorized by Shareholder.

(c)            As of the Closing
Date, Buyer will duly observe and assume full responsibility for the Assumed
Liabilities and the Training Obligations, and shall assume possession and
ownership of the Assets.

7.             Indemnification:  Buyer shall indemnify, hold harmless and
defend Seller, its parent company, affiliates, officers, agents, shareholders
and employees from and against any cause of action, claim, loss or liability
arising out of or resulting in any way from: (i) the negligent acts or
omissions of Buyer’s officers, employees, agents or shareholders; (ii) any 

 4
 

breach or inaccuracy
of any representation, warranty or covenant of Buyer set forth in this
Agreement; (iii) any debts, claims, liabilities or lawsuits which relate to the
use or operation of the Business or the Assets after the Closing Date; and (iv)  the failure to fully and adequately assume
the Assumed Liabilities, including the Training Obligations.  If after ten (10) days from receipt of
written notice the Buyer fails to defend the Seller as required above, Seller
will have the right (but not the obligation) to undertake the defense,
compromise or settlement of such action on behalf of, and for the account and
at the risk of Buyer.

8.             Insurance:  Buyer agrees to maintain general liability
insurance in the amounts of $1,000,000 per claim and $1,000,000 in the aggregate,
and upon written request Buyer will provide Seller with certificates of
insurance naming Seller or its affiliated companies as additional insureds, in
order to ensure that Buyer is able to meet its indemnification obligations
hereunder.  Notwithstanding any provision
to the contrary, to the extent permitted by law, Buyer may satisfy, in whole or
in part, the insurance requirements of this Agreement by a plan of self
insurance.

9.             Customer
Records: The Parties will maintain
the confidentiality of all customer records and files in accordance with
applicable federal and state laws and regulations.  On the Closing Date, Seller agrees to
transfer to Buyer all original customer records and files that relate to the
purchase and delivery of computer training for the Business, including the
files which relate to the Training Obligations. 
In the event that Seller is audited by any federal, state or local
entity following the Closing Date, Buyer shall provide Seller or its designees
with reasonable access, during normal business hours, to all original customer
files related to the Assets.

10.          Notices:  All notices with respect to this Agreement
will be sent by certified mail or facsimile, to the following addresses or
facsimile numbers:

If to Seller:

New Horizons Computer
Learning Center of Charlotte, Inc.

Attention:  Office of General Counsel

1900 S. State College
Blvd., Suite 200

Anaheim, CA 92806

Tel:  (714) 940-8000

Fax:  (714) 938-6007

If to Buyer:

Sukothai, Inc.

Attention:  Kimberly Pongpat

5095 Ritter Road, Suite
114

Mechanicsburg, PA
17055

11.          Entire
Agreement; Assignment:  Except for the Franchise Agreement and
related agreements which are being executed concurrently herewith, this
Agreement and the exhibits attached hereto represent the entire agreement between
the Parties and are binding on each Party’s respective successors, heirs and
assigns.  This Agreement may not be
assigned 

 5
 

without the
written consent of the other party, and may only be amended by a written
agreement signed by authorized representatives of both Parties.

12.          Waiver:  The failure of either party to
enforce any right, remedy or condition of this Agreement shall not be deemed a
waiver thereof nor shall it void or otherwise affect its right to enforce the
same right, remedy or condition at any subsequent time.

13.          Survival
of Representations and Warranties:  The representations and
warranties set forth in this Agreement shall survive and continue until the
expiration of the applicable statute of limitations.

14.          Counterparts:  This Agreement may be executed in one or more
counterpart, each of which shall be deemed an original, and all of which
together shall constitute but one and the same instrument.

15.          Facsimile
Signatures:  For purposes of
execution of this Agreement, faxed signature pages shall be deemed the same as
original signature pages.

16.          Governing
Law:  This
Agreement will be governed by the laws of the State of California.

NEW HORIZONS COMPUTER LEARNING
CENTER OF CHARLOTTE, INC.

 

	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Thomas J. Bresnan

  	
   

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SUKOTHAI,
  INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Kimberly Pongpat

  	
   

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SHAREHOLDER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Kimberly Pongpat

  	
   

  	
   

  

 

 6
 

EXHIBIT A

Assets

1.             The following assets are included in the sale of
the Business:

	
  Trade Accounts Receivable:

  	
   

  	
  $

  	
  463,605

  	
  (a)

  
	
  Suspense:

  	
   

  	
  $

  	
  (6,578

  	
  )

  
	
  Futures Reserve:

  	
   

  	
  $

  	
  (117,031

  	
  )

  
	
  Credit Memo Reserve:

  	
   

  	
  $

  	
  (31,390

  	
  )

  
	
  Other Prepaid Expenses:

  	
   

  	
  $

  	
  19,569

  	
   

  
	
  Inventory – Student Kits & Test Vouchers:

  	
   

  	
  $

  	
  27,405

  	
   

  
	
  Inventory – Manuals:

  	
   

  	
  $

  	
  12,137

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Fixed Assets (b)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Leasehold Improvements:

  	
   

  	
  $

  	
  84,970

  	
   

  
	
  Capitalized Computer Software:

  	
   

  	
  $

  	
  17,664

  	
   

  
	
  Furniture & Fixtures:

  	
   

  	
  $

  	
  119,834

  	
   

  
	
  Computer Equipment:

  	
   

  	
  $

  	
  275,761

  	
   

  
	
  Vehicles:

  	
   

  	
  $

  	
  3,550

  	
   

  

 

(a) Gross value to be netted
against suspense, future reserve and credit memo reserve

(b) Gross value of fixed
assets shown.  Accumulated depreciation
and amortization is $453,053 and net fixed asset value is $48,725

Buyer
and Seller acknowledge that the assets listed above have been calculated as of
January 31, 2006.  Buyer and Seller agree
to revise these assets within thirty (30) days of the Closing Date to reflect
the actual operations of the Business as of the Closing Date.

 7
 

EXHIBIT B

Assumed Liabilities

1.                                      Telephone systems located at the Charlotte
Facility.

2.                                      Cellular and regular telephone numbers (with any
remaining service term assumed at Buyer’s expense).

3.                                      DSL computer line (with any remaining service
term assumed at Buyer’s expense).

4.                                      Training Obligations as more fully described in
Section 4(d).  [***]

5.                                      Buyer shall assume those obligations which are
specifically listed below:

	
  Accounts Payable:

  	
   

  	
  $

  	
  37,606

  	
   

  
	
  Payable to other Franchisees:

  	
   

  	
  $

  	
  47,155

  	
   

  
	
  Sales Tax Payable:

  	
   

  	
  $

  	
  2,023

  	
   

  
	
  Net
  Other Accrued Liabilities to Buyer:

  	
   

  	
  $ 

  	
  29,297
  

  	
  (a)

  

 

(a) Adjusted to exclude
audit fees, Online Live and Online Anytime expenses related to sales

Buyer and Seller acknowledge
that the liabilities listed above have been calculated as January 31,
2006.  Buyer and Seller agree to revise
these obligations within thirty (30) days of the Closing Date to reflect the actual
operations of the Business as of the Closing Date.

6.                                       On the Closing Date, Seller shall terminate the
existing employees of the Center and shall offer employment to those employees
who Buyer wishes to employ.    Buyer
shall indemnify Seller for any liability which may arise by virtue of Buyer’s
failure to re-hire employees or which may relate to any employment issues for
hired employees.

 8
 

EXHIBIT C

BILL OF
SALE

FOR GOOD AND VALUABLE CONSIDERATION,
the receipt of which is hereby acknowledged, the undersigned, New Horizons
Computer Learning Center of Charlotte, Inc., a Delaware corporation having its
principal place of business at 1900 S. State College Blvd., Suite 200, Anaheim,
CA 92806 (“Seller”) hereby sells, conveys, transfers, assigns and delivers to
Sukothai, Inc., a North Carolina corporation having an address at 5095 Ritter
Road, Suite 114, Mechanicsburg, PA 17055 (“Buyer”), all of its right, title and
interest in and to the Assets as such term is defined in that certain Asset
Purchase Agreement (“Agreement”), dated as of March 10, 2006, among Buyer and
Seller.

TO HAVE AND TO HOLD the same
unto Buyer, its successors and assigns forever.

This
Bill of Sale is delivered pursuant to and is subject to and governed by the
terms and conditions of the Agreement. The representations, warranties and
covenants as set forth in the Agreement shall survive delivery of this Bill of
Sale as set forth in the Agreement.

This Bill of Sale is
ancillary to the Agreement, and in the event of a conflict between the terms of
this Bill of Sale and the terms of the Agreement, the terms of the Agreement
shall govern.

IN
WITNESS WHEREOF, the undersigned has caused this instrument
to be duly executed as of 11:59 p.m. on the 31st day of March, 2006.

NEW
HORIZONS COMPUTER LEARNING CENTER OF CHARLOTTE, INC.

	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Thomas J. Bresnan

  	
   

  	
   

  	
   

  
	
   

  	
  President

  	
   

  	
   

  	
   

  

 

 9
 

EXHIBIT D

SUBLEASE
AGREEMENT

This Sublease Agreement (the “Sublease”) is
made and entered into as of this 1st day of April, 2006, by and between New
Horizons Computer Learning Center of Charlotte, Inc., a Delaware corporation (“Sublessor”), and Sukothai, Inc., a North Carolina
corporation (“Sublessee”).

RECITALS

A.            Sublessor leases from Arrowpoint Associates Limited Partnership (“Landlord”) the premises located at 9140 Arrowpoint Blvd.,
Office Building No. 2, Charlotte, North Carolina 28273 (the “Premises”) pursuant to a lease agreement dated December 17,
1996, as amended (the “Lease”)
attached hereto as Attachment 1;

B.            Sublessor now wishes to sublease the Premises to Sublessee, and Sublessee
wishes to sublease the Premises from Sublessor in order for Sublessee to
operate a New Horizons Computer Learning Center on the Premises, subject to the
terms of a franchise agreement between Sublessee and New Horizons Computer
Learning Centers, Inc. dated the 1st day of April, 2006 (the “Franchise
Agreement”); and

C.            Sublessee acknowledges that it has received, reviewed, and approved the
Lease.

The parties agree as follows:

1.             SUBLEASE TERM

1.1           Term.  Sublessor hereby subleases the Premises to Sublessee,
and Sublessee accepts such sublease, subject to the terms of this Sublease and
applicable provisions of the Lease.  The
Sublease shall commence on the 1st day of April, 2006 (“Sublease Commencement Date”), shall expire on September 30,
2009 (the “Sublease Term”); provided,
however, that the Sublease shall automatically terminate upon the expiration or
termination of the Franchise Agreement.

1.2           Conflict with Term of Franchise Agreement.  Sublessor and Sublessee
acknowledge that the term of the Franchise Agreement may extend beyond the term
available under the Lease and that Sublessor cannot extend the term of this
Sublease beyond the remaining term under the Lease.  Sublessee acknowledges that this Sublease may
terminate due to the expiration of the remaining term under the Lease prior to
the expiration of the Franchise Agreement for the Premises.   Sublessee acknowledges and agrees that in
order to avoid an automatic termination of the Franchise Agreement, it must
negotiate a new direct lease with the Landlord for the Premises or otherwise
obtain a right to retain possession of the Premises in accordance with the
Franchise Agreement.

 10
 

2.             RENT

2.1           Monthly Rent.  Beginning on the Sublease Commencement Date,
Sublessee shall pay to Sublessor a monthly rental payment (“Rent”) in accordance with the schedule set forth below,
which is subject to adjustment in accordance with the terms herein:

	
  Sublease Term

  	
   

  	
  Estimated Monthly Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Sublease
  Commencement Date through December 31, 2006:

  	
   

  	
  $

  	
  18,783.94

  	
   

  
	
  January 1, 2007
  through December 31, 2007:

  	
   

  	
  $

  	
  18,783.94

  	
   

  
	
  January 1, 2008
  through December 31, 2008:

  	
   

  	
  $

  	
  18,783.94

  	
   

  
	
  January 1, 2009 through
  September 30, 2009:

  	
   

  	
  $

  	
  18,783.94

  	
   

  

 

Sublessee understands and agrees that the
Rent is adjusted as of January 1 each year during the sublease Term by an
amount which is calculated in accordance with Section 22.02 of the Lease.  Sublessee agrees to promptly pay any
increases in Rent upon receipt of notice from either Sublessor or
Landlord.  Sublessee further understands
that the Estimated Monthly Rent figures set forth above shall all be subject to
adjustment in accordance with Section 22.02 of the Lease, including the Rent
due and payable in 2006.  Sublessee shall
make payments of Rent at the address set forth below, due no later than the
tenth (10th) day of each month during the sublease Term; provided however, that
Sublessee shall pay the first month’s Rent due hereunder upon the execution of
this Sublease.

2.2           Late Charge and Interest.  Should Sublessee fail to pay
any part of the Rent required pursuant to this Lease within five (5) days after
the due date, Sublessee shall pay to Sublessor a late charge of ten percent
(10%) of the overdue amount as a late charge. 
The parties agree that this late charge represents a fair and reasonable
estimate of the costs that Sublessor will incur by reason of late payment by
Sublessee.  Acceptance of any late charge
shall not constitute a waiver of Sublessee’s default with respect to the
overdue amount, or prevent Sublessor from exercising any of the other rights
and remedies available to Sublessor.  In
addition, Rent not paid when due shall bear interest from the date due until
paid at the lesser of fifteen percent (15%) per year or the maximum rate
allowed by law.

2.3           Partial Months.  Rent for partial months shall be pro rated on
the basis of the actual number of days in the month.

2.4           Operating Expense Payments.  Sublessee shall pay taxes and
operating expenses (as provided in Section 1.01M of the Lease) (“Operating
Expenses”) to Sublessor in the amounts and with such frequency as Sublessor is
obligated to pay Operating Expenses to Landlord as provided in the Lease.  Sublessee understands and agrees that, as is
the case with Rent, the Operating Expenses are also subject to adjustment in
accordance with Section 22.02 of the Lease. 
Sublessee agrees to promptly pay any adjusted Operating Expenses upon
receipt of notice from either Sublessor or Landlord

 11
 

3.             PREMISES

3.1           Condition.  Sublessee acknowledges that it has inspected
the Premises and agrees to accept the Premises “as is.”  Sublessee’s occupancy of the Premises shall
conclusively establish that the Premises were in satisfactory condition at such
time.  Sublessor makes no representations
as to: (a) the square footage of the Premises, (b) the condition of the
Premises, (c) the condition of any existing tenant improvements, or (d)
compliance with zoning or restrictive covenants.   Sublessee shall, on the last day of the
Sublease term, or any extension thereof, or upon any earlier termination of
such term, surrender to Sublessor the Premises in good order, condition and
state of repair, reasonable wear and tear excepted.

3.2           Maintenance and Repair.    Sublessee shall, at its sole
cost and expense, perform the maintenance obligations and make any and all
repairs or replacements: (a) which Sublessor reasonably believes are required
to be made by Sublessor as Lessee under the Lease; (b) which are required by
any law now or hereafter affecting the Premises; or (c) which are required
pursuant to the terms of the Franchise Agreement.  If Sublessee fails to maintain and repair the
Premises, Sublessor may, on five (5) days prior notice, enter the Premises and
perform such repair and maintenance on behalf of Sublessee.  However, in the case of an emergency,
Sublessor shall have immediate rights to enter the Premises and perform such
repair.  In either case, Sublessee shall
reimburse Sublessor for all costs so incurred immediately upon demand.  It is the intention of Sublessor and
Sublessee, that at all times during the Sublease term and any extension
thereof, Sublessee shall maintain the Premises in an attractive, fully
operative condition.  Sublessor shall
have no responsibility hereunder to repair, maintain or replace any portion of
the Premises at any time.  Sublessee
waives any benefit of any present or future laws which might give Sublessee the
right to repair the Premises at Sublessor’s expense or to terminate the
Sublease due to the condition of the Premises. 
Sublessee shall not commit any waste.

3.3           Use.   Sublessee shall not use the Premises for any
purpose other than operating a New Horizons Computer Learning Center as a New
Horizons franchisee.   Sublessee
acknowledges that neither Landlord, Sublessor, nor any agent acting on their
behalf has made any representation or warranty with respect to the suitability
of the Premises for the conduct of Sublessee’s business.

3.4           Tenant Improvements.  Sublessee is solely responsible for the
construction and costs of any leasehold improvements desired by Sublessee, and
the demolition of existing leasehold improvements if necessary, including all
permits, approvals, or the equivalent thereof, required by a governmental
agency.  Sublessee shall not make any
alterations or additions costing in the aggregate more than twenty thousand
dollars ($20,000) within any twelve (12) month period or make any structural
alterations without first obtaining the written consent of Sublessor, subject
to any additional requirements for approval under the Lease.  Sublessee shall give Sublessor at least
thirty (30) days notice of any alterations or additions so that Sublessor shall
have the opportunity to post a notice of non-responsibility, as may be provided
for by local law.   Tenant’s alterations
and additions shall be completed on the same terms and conditions as contained
in the Lease.

3.5           Signs.  Sublessee shall erect only such signs on the
Premises as are allowed by the Franchise Agreement and the Lease.

 12
 

4.             INSURANCE

4.1           Required Coverage.

(a)           Beginning on the Commencement Date and continuing thereafter for the
full terms, and any extensions thereof, Sublessee shall maintain in full force
and effect, at Sublessee’s sole cost and expense, the various insurance
coverages required to be carried by Sublessee under the Franchise Agreement for
the Premises; provided, however, that if the amounts and types of insurance
coverages required pursuant to the terms of the Lease are greater, Sublessee
shall obtain insurance in such greater amounts or types.

(b)            Sublessee shall also carry and pay for public liability insurance from
a responsible insurance company licensed to do business in the state in which
the Premises are located during the entire term of this Sublease in amounts not
less than those required by the Franchise Agreement.  Sublessee shall deliver to Sublessor a
certificate of insurance for each policy provided for in this Section 4.  Sublessor shall be shown as an additional
insured and loss payee on such policies, which shall not be canceled without
thirty (30) days notice to Sublessor.

4.2           Waiver of Subrogation. Sublessor and
Sublessee each waive their right to sue and recover damages against each other
with respect to any liability arising under the Lease or this Sublease and
which is required to be covered by any insurance policy in the Lease or this
Sublease.  Each party agrees to endeavor
to cause its insurer to waive its rights against the other party in the event
of an insured casualty which is not caused by the willful misconduct of the
other party.

4.3           Sublessee’s Property.  Sublessee shall be solely responsible for
insuring its own property on the Premises. 
Sublessor shall not be responsible for loss or damage to the personal
property of Sublessee, its sublessees, employees, customers, or invitees, in
the absence of the receipt of an insurance payment by Sublessor attributable to
such loss (in which event said payment shall be delivered forthwith to
Sublessee), or unless such loss or damage was occasioned by the willful
misconduct of Sublessor, its agents, servants, or employees; but subject in any
event to Section 4.2.

5.             DAMAGE TO PREMISES AND CONDEMNATION

If any part of the Premises is condemned or
damaged by fire or other casualty during the term of this Sublease, this
Sublease shall remain in full force and effect unless and until the Lease is
canceled.  If the Lease is canceled for
such cause, Sublessee’s obligations under this Sublease shall abate as of the
date of such cancellation.  Otherwise,
Sublessee’s obligations shall abate only to the actual monetary extent and for
the duration that Sublessor’s obligations are reduced under the Lease.  In the event of a condemnation by eminent
domain, any award to the Sublessee shall belong to and be paid to Sublessor,
including any amount attributable to any leasehold interest, except that
Sublessee shall receive from the award a sum, if any, allocated for damage,
destruction or taking of Sublessee’s furniture, trade fixtures or equipment;
provided, however, that Sublessee is not in default hereunder.  Sublessee may also pursue and retain any 

 13
 

award from the condemning authority, payable
solely and specifically to Sublessee for the loss of Sublessee’s business.

6.             OBLIGATIONS UNDER THE LEASE

6.1           Assumption by Sublessee.  In addition to the terms,
conditions and provisions of this Sublease, Sublessee understands and agrees
that this Sublease is subject to each and all of the terms, conditions and
provisions of the Lease and of the rights of Landlord thereunder.  Except as expressly provided in this
Sublease, Sublessee expressly assumes all of the responsibilities and
obligations imposed upon Sublessor as the tenant under the terms of the
Lease.  In the event any inconsistency
arises between the Lease and this Sublease in the obligations of the Sublessee,
the more stringent obligations shall prevail.

6.2           Sublessor’s Obligations.  Sublessor covenants to pay all
amounts owed to Landlord under the Lease to the extent Sublessee complies with
its obligations under this Sublease. 
Sublessor acknowledges that this Sublease shall not limit or impair
Sublessor’s liability to Landlord under the Lease.

6.3           Landlord’s Obligations.  Sublessor shall not be liable
to Sublessee for the defaults of Landlord under the Lease.

6.4           Negotiations with Landlord.  Sublessee may negotiate
provisions of the Lease with the Landlord to benefit Sublessee; provided,
however, that Sublessor’s consent shall be required, which consent shall not be
unreasonably withheld, and further, that no changes shall be made to the Lease
that enlarge the responsibilities or obligations of Sublessor, including
Sublessor liability beyond the term of the Lease.

7.             INDEMNITY

7.1           Generally.  Sublessee shall indemnify, hold harmless, and
defend Sublessor from all claims, costs, damages, liabilities, and loss
incurred by Sublessor, including reasonable attorneys fees and costs of suit,
as a result of Sublessee’s default under this Sublease or the Lease, or as the
result of any act or failure to act by Sublessee, its agents, employees,
customers, invitees, licensees, successors, heirs, or assigns, or any and all
persons coming upon or near the Premises with regard to the Premises.

7.2           Hazardous Materials.  Sublessee agrees to indemnify and hold
Sublessor harmless from any and all costs of any remedial action or cleanup of
Hazardous Materials suffered or incurred by Sublessor arising out of or related
to Sublessee’s use of the Premises.  “Hazardous Materials” means any hazardous, toxic, infectious,
or radioactive substances, wastes, or materials listed or defined by any
federal or state environmental law.

8.             DEFAULT

8.1           Notice; Cure.  Sublessee shall cure any failure to perform
Sublessee’s obligations under this Sublease or the Lease:  (a) within three (3) days after receiving
notice of any monetary 

 14
 

default, or (b) within ten (10) days after
receiving notice of any non-monetary default, except that if Sublessee cannot
reasonably cure the non-monetary default within ten (10) days, Sublessee shall
have up to thirty (30) days to complete the cure, so long as Sublessee proceeds
with due diligence.  If Sublessee fails
to cure defaults during the grace periods specified above, Sublessor shall have
the right to declare a default under this Sublease.

8.2           Remedies.  Sublessor shall have the following rights and
remedies upon a default by Sublessee under this Sublease:

(a)           Sublessor may terminate this Sublease and upon such termination,
Sublessor may recover from Sublessee the amount by which the unpaid rent which
would have been earned after termination until the time that Sublessee proves
such loss could have been reasonably avoided; and

(b)           Sublessor may relet the Premises prior to the breach of this Sublease
by Sublessee.  In such case, if Sublessor
proves that in reletting the Premises it acted reasonably and in good faith to
mitigate damages, it shall be entitled to an award for Sublessee’s improper
termination of this Sublease.

(c)           Sublessor shall also have the right, but not the obligation, to cure
any default by Sublessee.  Sublessee
shall repay any costs incurred by Sublessor in doing so upon Sublessor’s
written demand.  All amounts owed
hereunder shall be considered rent and shall bear interest at the rate of ten
percent (10%) per annum or the maximum rate permitted by law, whichever is
less, from five (5) days after such demand to the date of payment.

8.3           Franchise Agreement.  Sublessee’s default under the Franchise
Agreement or any other document related to Sublessee’s operation of a New
Horizons Computer Learning Center on the Premises, including any promissory note,
shall be deemed a default under this Sublease. 
In addition, Sublessee’s default hereunder shall constitute a default
under the Franchise Agreement, and New Horizons Computer Learning Centers, Inc.
may terminate the Franchise Agreement in accordance with the terms thereof.

8.4           Remedies Cumulative.  The remedies specified in this Sublease are
cumulative and in addition to any other remedies which may be available at law
or in equity.

9.             ASSIGNMENTS

Sublessee shall not assign or sublet the
Premises, in full or in part without Sublessor’s prior written consent in each
instance, which Sublessor may withhold in its sole discretion.  Any assignment without the requisite consents
shall be void and shall, at the option of Sublessor, terminate this Sublease.  The consent by Sublessor to one assignment or
subletting shall not be deemed to be consent to any subsequent assignment or
subletting.

 15

10.           UTILITIES

Sublessee is required to open and maintain
utility accounts in its name for, and to pay, prior to delinquency, all charges
for water, gas, heat, lights, power, trash, telephone service and all other
services supplied to the Premises during the term of this Sublease.

11.           NOTICES

11.1         Notices:  Any and all notices furnished pursuant to
this Sublease shall be in writing and shall be personally delivered, sent by
telecopier, mailed by certified mail, return receipt requested, or dispatched
by overnight delivery envelope to the respective parties at the following
addresses, unless and until a different address has been designated by written
notice to the other party:

	
  Notices to Sublessor:

  	
   

  	
  New
  Horizons Computer Learning Center of Charlotte, Inc.

  
	
   

  	
   

  	
  1900
  S. State College Blvd., Suite 200

  
	
   

  	
   

  	
  Anaheim,
  CA 92806

  
	
   

  	
   

  	
  Attention:
  Legal Department

  
	
   

  	
   

  	
   

  
	
  Notices
  to Sublessee:

  	
   

  	
  Sukothai,
  Inc.

  
	
   

  	
   

  	
  5095
  Ritter Road, Suite 114

  
	
   

  	
   

  	
  Mechanicsburg,
  PA 17055

  
	
   

  	
   

  	
  Attention:
  Kimberly Pongpat

  

 

Notices shall be deemed to have been received
as follows:  by personal delivery or
telecopier — at time of delivery; by overnight delivery service — on the next
business day following the date on which the Notice was given to the overnight
delivery service; and certified mail — three days after the date of mailing.

11.2         Under Lease.  Sublessee shall promptly provide Sublessor
with a copy of all notices received from Landlord regarding the Premises, the
Lease, or this Sublease.

12.           HOLDOVER TENANCY

At the expiration of the
Sublease, or earlier termination for any reason, Sublessee shall immediately
surrender possession of the Premises to Sublessor.  Should Sublessee fail to do so, it consents
to pay any and all damages which Sublessor may suffer, including attorneys’
fees, costs and expenses incurred by Sublessor to obtain possession of the
Premises.  Sublessee expressly waives any
notice to vacate at the expiration of the Sublease.  Should Sublessor allow or permit Sublessee to
remain in the Premises after the expiration or termination of this Sublease,
this shall not be construed as an extension of this Sublease, and such holding
over shall be deemed to have created a month-to-month tenancy, subject to all
the terms and conditions of this Sublease, except that Sublessee shall pay Rent
to Sublessor at a rate equal to two hundred percent (200%) of the monthly
rental paid during the one (1) year period immediately preceding the expiration
of the Sublease

 16
 

13.           LEGAL EXPENSES

In the event either party
brings an action against the other by reason of the alleged breach or any term,
covenant or condition of this Sublease, the prevailing party shall be entitled
to recover from the other party all legal expenses, including reasonable
attorneys’ fees, in an amount to be fixed by the court rendering such
judgment.  The foregoing provision
notwithstanding, in the event Sublessee shall be in default under this
Sublease, and shall cure such default after notice by Sublessor pursuant to
this Sublease, then all reasonable attorneys’ fees incurred by Sublessor as a
result of such default shall be paid by Sublessee.  Such attorneys’ fees shall be added to the
subsequent month’s Rent as additional Rent. 
Sublessee shall reimburse Sublessor, upon demand, for any costs or
expenses incurred by Sublessor in connection with any breach by or default of
Sublessee under this Sublease, whether or not suit is commenced or judgment
entered.  Such costs shall include legal
fees and costs incurred for the negotiation of a settlement, enforcement of rights
or otherwise.  Sublessee shall also
indemnify Sublessor for, and hold Sublessor harmless form and against, all
liabilities incurred by Sublessor if Sublessor becomes or is made a party to
any proceeding claim or action instituted: (a) by Sublessee; (b) by any third
party against Sublessee; (c) by or against any person holding an interest under
Sublessee or using the Premises by license of or agreement with Sublessee; (d)
for foreclosure of any lien for labor and material furnished to or for
Sublessee or such other person; or (e) otherwise arising out of or resulting
from any act or omission of Sublessee or such other person.

14.           CONTROLLING LAW; VENUE

This Sublease shall be
governed and construed in accordance with the laws of North Carolina.  The parties agree that any action brought by
either party against the other in any court, whether federal or state, will be
brought exclusively within the State of North Carolina, except that, Sublessor
may, at Sublessor’s discretion, seek injunctive and equitable relief in any
court of competent jurisdiction in order to evict Sublessee or prevent waste or
other actions by Sublessee that will irreparably harm Sublessor.  Sublessee hereby irrevocably consents to the
jurisdiction of such court and waives any objection Sublessee may have to
either jurisdiction or venue of such court.

15.           ENTIRE AGREEMENT

This Sublease constitutes the entire
agreement among the parties and supersedes any oral or written understandings
relating to the Lease or the Sublease. 
This Sublease may be modified only by written agreement between the
parties or their successors subsequent to the date of this Sublease.

 17
 

IN WITNESS WHEREOF, the parties hereto have duly executed, sealed, and delivered this
Sublease as of the day and year written below. 

SUBLESSOR

NEW HORIZONS COMPUTER LEARNING
CENTER OF CHARLOTTE, INC.

	
  By:

  	
   

  	
   

  
	
   

  	
  Thomas
  J. Bresnan

  
	
   

  	
  President

  
	
   

  
	
  SUBLESSEE

  
	
   

  
	
  SUKOTHAI,
  INC.

  
	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Kimberly
  Pongpat

  
	
   

  	
  President

  
	
   

  	
   

  

 

CONSENT TO THE FOREGOING SUBLEASE IS HEREBY GRANTED:

LANDLORD

ARROWHEAD ASSOCIATES LIMITED
PARTNERSHIP

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
					

 

 18
 

ATTACHMENT 1

LEASE

 19
 

ATTACHMENT 2

PERSONAL GUARANTEE

As an inducement to New Horizons Computer
Learning Center of Charlotte, Inc. (“Sublessor”)
to execute the Sublease (the “Sublease”) with Sukothai, Inc. (“Sublessee”)  and in
consideration of Sublessor’s executing the Sublease and of the sum of One
Dollar ($1.00) now paid by Sublessor to Guarantors, the receipt of which is
hereby acknowledged, Guarantors jointly and severally agree as follows:

1.             Guarantors shall pay or cause to be paid to Sublessor all monies
payable by Sublessee under the Sublease on the days and times in the manner
therein appointed for payment thereof.

2.             Guarantors unconditionally guarantee full performance and discharge by
Sublessee of all the obligations of Sublessee under the Sublease at the times
and in the manner therein provided.

3.             Guarantors shall indemnify and save harmless Sublessor and its
affiliates against and from all losses, damages, costs, and expenses which
Sublessor and its affiliates may sustain, incur, or become liable for by reason
of:

a.             the failure for any reason whatsoever of Sublessee to pay the monies
payable pursuant to the Sublease or to do and perform any other act, matter or
thing pursuant to the provisions of the Sublease; or

b.             any act, action, or proceeding of or by Sublessor, its agents,
employees, etc. for or in connection with the recovery of monies or the
obtaining of performance by Sublessee of any other act, matter or thing
pursuant to the provisions of the Sublease.

4.             Sublessor shall not be obligated to proceed against Sublessee or
exhaust any security from Sublessee or pursue or exhaust any remedy, including
any legal or equitable relief against Sublessee, before proceeding to enforce
the obligations of the Guarantors herein set out, and the enforcement of such
obligations may take place before, after, or contemporaneously with,
enforcement of any debt or obligation of Sublessee under the Sublease.

5.             Without affecting the Guarantors’ obligations under this Guarantee,
Sublessor, without notice to the Guarantors, may extend, modify, or release any
indebtedness or obligation of Sublessee, or settle, adjust, or compromise any
claims against Sublessee.  Guarantors
waive notice of amendment of the Sublease and notice of demand for payment or
performance by Sublessee.

6.             Guarantors’ obligations hereunder shall remain in full force and
effect, and shall be unaffected by: 
(a) the unenforceability of the Sublease against Sublessee;
(b) the termination of any obligations of Sublessee under the Sublease by
operation of law or otherwise; (c) the bankruptcy, insolvency,
dissolution, or other liquidation of Sublessee, including, without 

 20
 

limitation, any surrender or disclaimer of
the Sublease by the trustee in bankruptcy of Sublessee; (d) Sublessor’s
consent or acquiescence to any bankruptcy, receivership, insolvency, or any
other creditor’s proceedings of or against Sublessee, or by the winding-up or dissolution
of Sublessee, or any other event or occurrence which would have the effect at
law of terminating the existence of Sublessee’s obligations prior to the
termination of the Sublease; or (e) by any other agreements or other
dealings between Sublessor and Sublessee 
having the effect of amending or altering the Sublease or Sublessee’s
obligations hereunder, or by any want of notice by Sublessor to Sublessee of
any default of Sublessee or by any other matter, thing, act, or omission of
Sublessor whatsoever.

7.             Notices to Guarantors:

	
  Name

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
  Phusit Tom
  Pongpat

  	
   

  	
  5095 Ritter Road, Suite 114

  
	
  Kimberly Pongpat

  	
   

  	
  Mechanicsburg, PA 17055

  

 

IN WITNESS WHEREOF, each of the undersigned has signed this Guarantee as of the day and year
of the Sublease.

	
  GUARANTORS:

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Phusit Tom Pongpat

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Kimberly
  Pongpat

  

 

 21
 

EXHIBIT E

PROMISSORY NOTE AND GUARANTY

	
  $37,500.00

  	
   

  	
  April 1, 2006

  

 

FOR VALUE RECEIVED, the undersigned (“Maker”),
hereby promises to pay to the order of New Horizons Computer Learning Center of
Charlotte, Inc., a Delaware corporation (“New Horizons”), or order, the sum of
thirty seven thousand five hundred dollars ($37,500.00), together
with interest on the unpaid principal balance hereof at the rate of 6% per
annum, which principal and accrued interest shall be due and payable in twelve equal monthly installments of $3,227.49 each, commencing upon the execution of this
promissory note and continuing thereafter on the fifteen day of each month
until the outstanding principal balance and all unpaid accrued interest has
been paid in full.

Maker
reserves the right to prepay all or any portion of this Promissory Note and
Guaranty (“Promissory  Note”) at any time
and from time to time without premium or penalty of any kind by paying, in
addition to the principal amount of such prepayment, the interest accrued
hereon to the date of such prepayment.

In
the event that (a) Maker shall default in the payment of principal or interest due
hereunder and such default shall continue for ten (10) days after the mailing
of written notice of such default to Maker at Maker’s last known address, or
(b) a receiver is appointed for Maker or any Guarantor or any part of Maker’s
property, or (c) Maker or any Guarantor makes any general assignment for the
benefit of Maker’s or any Guarantor’s creditors, or any proceeding is commenced
by or against Maker or any Guarantor or any other guarantor, surety, endorser,
or person directly or indirectly liable for any of the obligations hereunder,
or (d) Maker shall be deemed in default of the Franchise Agreement as of April
1, 2006 between Maker and New Horizons Computer Learning Centers, Inc., or its
affiliate (“Franchisor”) (the events described in subparts (a), (b), (c) and
(d) are collectively referred to as Default”), the holder of this Promissory
Note at the time of the Default (the “Holder”) shall have the right, if a
Default occurs, to declare the outstanding principal balance hereof and all
unpaid accrued interest immediately due and payable in full (the “Balance Due”).

If
a Default occurs, Maker and Guarantors also agree to pay upon demand all costs
and expenses reasonably incurred or paid at any time by Holder, including, but
not limited to, reasonable attorneys’ fees and other legal costs, in enforcing
payment and collection of the Balance Due of this Promissory Note.

Maker
and Guarantors agree: no delay or omission by Holder in exercising any of its
rights or remedies hereunder or otherwise shall impair any of such rights or
remedies, nor shall any such delay or omission be construed as a waiver of any
Default hereunder, and Holder may exercise every such right and remedy from
time to time as often as Holder may deem expedient; all rights 

 22
 

and
remedies of Holder whether or not granted hereunder shall be cumulative and may
be exercised singularly or concurrently, and no such right or remedy is
intended to be exclusive of any other right or remedy of Holder; and no waiver
by Holder of any Default hereunder shall be effective unless in writing and
signed and delivered by Holder, and no such waiver or any default shall extend
to or affect any subsequent or other Default or impair any rights or remedies
of Holder.

This
Promissory Note shall be the joint and several obligation of Maker, Guarantors
and all guarantors, sureties, endorsers, and/or any other persons now or
hereafter liable hereon, if any, and shall be binding upon them and their
heirs, executors, personal representatives, successors and assigns.

Any
demand upon or notice of other communication to Maker and/or any Guarantor
shall be effective if delivered by hand delivery or deposited in the mails,
postage prepaid, addressed to Maker and/or any Guarantor at the address(es) of
Maker and/or any Guarantor as set forth in Holder’s records, or, if Maker
and/or any Guarantor has notified Holder of a change of address, to the last
address of which Holder has been so notified.

Maker
and each Guarantor, for Maker and each Guarantor and for any guarantors, sureties,
endorsers and/or any other persons now or hereafter liable hereon, if any,
hereby waive demand for payment, presentment for payment, protest, notice of
nonpayment or dishonor, and any and all other notices and demands whatsoever.

If
any provision or application of this Promissory Note is adjudicated to be
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provision or application of this Promissory Note that can be given
effect without the invalid or unenforceable provision or application.  Interest shall accrue hereunder at the lesser
of (a) the rate stated hereinabove, or (b) the maximum rate permitted by law.

For
additional and other value received, the existence, amount and sufficiency of
which are hereby acknowledged, the undersigned guarantor(s) (singly or
collectively referred to as “Guarantor”) jointly and severally hereby
guarantees to Holder (a) the immediate, absolute and unconditional payment of
the Balance Due of this Promissory Note after Default and (b) the immediate,
absolute and unconditional payment of all costs and expenses reasonably
incurred or paid at any time by Holder, including, but not limited to,
reasonable attorneys’ fees and other legal costs, in enforcing payment and
collection of the Balance Due of this Promissory Note.

This
Promissory Note shall be governed by, and construed and enforced in accordance
with, the internal laws of the North Carolina applicable to contracts made and
to be performed wholly within such state.

 23
 

IN WITNESS WHEREOF, Maker and Guarantors have executed and
delivered this Promissory Note at the place specified above and as of the date
first written above.

	
  MAKER:

  
	
   

  
	
  SUKATHAI, INC.

  
	
   

  	
   

  	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Kimberly Pongpat

  
	
   

  	
  President

  
	
   

  
	
  GUARANTORS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Phusit Tom Pongpat

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Kimberly Pongpat

  
				

 

 24

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