Document:

Exhibit 10.5

 Exhibit 10.5 
  
 SHARED SERVICES AGREEMENT 
  
 SHARED SERVICES AGREEMENT
dated as of June 30, 2003, by and among Educate Operating Company, LLC, a Delaware limited liability company (“Purchaser”), and Sylvan Learning Systems, Inc., a Maryland corporation (“Sylvan” or “Seller”), and
Sylvan shall include Sylvan Ventures, L.L.C., a Delaware limited liability company (“Ventures”). 
  
 WHEREAS, Educate, Inc., a Delaware corporation (“Holdings”), the Purchaser and Sylvan have entered into an Asset Purchase
Agreement dated as of March 10, 2003, as amended by Amendment No. 1 therto as of June 30, 2003 (the “Purchase Agreement”), pursuant to which the Purchaser is purchasing from Sylvan the assets comprising the Targeted Businesses. Capitalized
terms used and not otherwise defined in this Agreement shall have the meanings assigned thereto in the Purchase Agreement to the extent defined therein. 
  
 WHEREAS, the Purchaser and Sylvan desire to ensure an orderly transition and to provide for each of the parties services necessary
to effect the smooth transition of the Targeted Businesses and the businesses of Sylvan not to be acquired by the Purchaser in the Transactions; and 
  
 NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties agree as
follows: 
  
 Section 1.    Effective
Date; Term, Termination. 
  
 (a) Subject to Section 4
below and unless earlier terminated pursuant to Section 1(b), the term of this Agreement with respect to each of the Shared Services (as defined in Section 3(a) hereof) shall be for three years beginning at the Closing Date (the “Term”).

  
 (b) This Agreement may be terminated by either party
(the “Non-Defaulting Party”) upon material default by the other party (the “Defaulting Party”) of any terms and conditions of this Agreement. The Non-Defaulting Party shall give the Defaulting Party written notice of such
failure, stating the nature thereof and a reasonable time (which shall be not less than thirty days in the case of a non-monetary default, any monetary default shall be governed by the provisions of Section 4(b) of this Agreement) to remedy such
failure. If the Defaulting Party does not correct the failure within the specified time, the Non-Defaulting Party may terminate this Agreement immediately following the expiration of such remedy period. 
  
 (c) Upon termination of this Agreement, the Purchaser shall provide
complete copies of the following as each relates to the Shared Services provided hereunder to the extent created by Purchaser or its Affiliates and exists at the termination of this Agreement: PeopleSoft environment and associated interfaces
including, but not limited to, all of the PeopleSoft documentation, table structures, tree structures, configuration settings, logical and physical data base designs, Excel interfaces, current and historical data, server configurations, operating
system setups and configuration data, business rules and policy documents. 
  

 (d) Upon termination of this Agreement, Sylvan shall provide complete copies of the following as
each relates to the Shared Services provided hereunder to the extent created by Sylvan or its affiliates and exists at the termination of this Agreement: current and historical data, server configurations, business rules and policy documents.

  
 Section 2.    Shared Services Provided
to Sylvan. 
  
 (a) Purchaser will use its reasonable
best efforts to provide Sylvan with each of five categories of shared services set forth in Exhibit A-1 hereto (each a “Purchaser Shared Service,” collectively, the “Purchaser Shared Services”). Each Party hereto agrees that the
Purchaser Shared Services provided under this Agreement shall be only those services set forth in Exhibit A-1, subject to any assumptions listed thereon, except that the Purchaser will provide services to facilitate the transition of Sylvan from use
of the Shared Services upon the termination of this Agreement. Sylvan shall make available to the Purchaser on a timely basis all data, information and other materials within Sylvan’s control which are reasonably necessary for the Purchaser to
perform each of the Purchaser Shared Services. The parties hereto agree that the Purchaser shall have no liability for any failure to perform, or for the late performance of, any Purchaser provided Purchaser Shared Services to the extent such
Purchaser Shared Services require data, information or other materials possessed, prepared or generated by Sylvan to the extent that Sylvan shall have failed to provide the same or to cause the same to be provided to the Purchaser in accordance with
the Purchaser’s reasonable written or oral (if confirmed in writing) requests. Purchaser shall not be required to perform any services under this Agreement outside the United States, however, such Purchaser Shared Services may be performed for
foreign entities or for transactions outside the United States. 
  
 (b) The parties hereby agree that the Purchaser shall perform its obligations under this Section 2 in accordance with work schedules that are consistent with the past practices of Sylvan as carried out during the twelve-month period
prior to the Closing Date; provided, however, that different schedules may be established for certain Purchaser Shared Services by mutual written agreement of the parties. The Purchaser shall use its reasonable best efforts to perform its
obligations hereunder with substantially the same level of performance, completeness, care and attention used by Sylvan in performing such Purchaser Shared Services for the K-12 Business prior to the Closing Date. 
  
 (c) The Purchaser shall use its reasonable best efforts to provide
sufficient management, administrative, technical, and clerical personnel (the “Purchaser Shared Services Personnel”) to enable the Purchaser to provide the Purchaser Shared Services in an efficient and professional manner. The Purchaser
will have full and complete authority to engage, dismiss, reprimand, or otherwise manage all Purchaser Shared Services Personnel. The Seller expressly understands and agrees that such actions by the Purchaser with respect to the Purchaser Shared
Services Personnel shall be in accordance with the Purchaser’s human resources policies in effect from time to time. Sylvan shall have no authority pursuant to this Agreement with respect to any aspect of the Purchaser’s business or
administrative policies. 
  
 (d) If Sylvan shall reasonably
determine that the Purchaser Shared Services Personnel providing the Purchaser Shared Services hereunder are ineffective, upon reasonable written request the Purchaser shall, as promptly as is practical, provide substitute Purchaser 
  

 Shared Services Personnel or take appropriate steps to ensure that the Purchaser Shared Services Personnel performing the
Purchaser Shared Services effectively perform said services. Nothing in this Section 2(d) shall require the Purchaser to hire additional employees or consultants to serve as Purchaser Shared Services Personnel. 
  
 (e) Prior to the end of each calendar year, Purchaser and Sylvan shall
agree in writing upon service level agreements for the Purchaser Shared Services. Service level agreements in effect at the time of the transaction close will be in effect for fiscal 2003. 
  
 Section 3.    Shared Services Provided to Purchaser.

  
 (a) Sylvan will use its reasonable best efforts to
provide the Purchaser with each of two categories of shared services set forth in Exhibit B-1 hereto (each “Seller Shared Service,” collectively, the “Seller Shared Services”, and together with the Purchaser Shared Services, the
“Shared Services”). Each Party hereto agrees that the Seller Shared Services provided under this Agreement shall be only those services set forth in Exhibit B-1, subject to any assumptions listed thereon, except that the Seller will
provide services to facilitate the transition of the Purchaser from use of the Seller Shared Services upon the termination of this Agreement. The Purchaser shall make available to Sylvan on a timely basis all data, information and other materials
within the Purchaser’s control which are reasonably necessary for Sylvan to perform each of the Seller Shared Services. The parties hereto agree that Sylvan shall have no liability for any failure to perform, or for the late performance of, any
Sylvan provided Seller Shared Services to the extent such Seller Shared Services require data, information or other materials possessed, prepared or generated by the Purchasers to the extent that the Purchasers shall have failed to provide the same
or to cause the same to be provided to Sylvan in accordance with Sylvan’s reasonable written or oral (if confirmed in writing) requests. Sylvan shall not be required to perform any services under this Agreement outside the United States,
however, such Seller Shared Services may be performed for foreign entities or for transactions outside the United States. 
  
 (b) The parties hereby agree that Sylvan shall perform its obligations under this Section 3 in accordance with work schedules that are consistent
with the practices of Sylvan as carried out during the twelve-month period prior to the Closing Date; provided, however, that different schedules may be established for certain Seller Shared Services by mutual written agreement of the parties.
Sylvan shall use its reasonable best efforts to perform its obligations hereunder with substantially the same level of performance, completeness, care and attention used by Sylvan in performing similar tasks and in performing such Seller Shared
Services for the Sellers Business prior to the Closing Date. 
  
 (c) Sylvan shall use its reasonable best efforts to provide sufficient management, administrative, technical, and clerical personnel (the “Sylvan Shared Services Personnel”) to enable Sylvan to provide the Seller Shared
Services in an efficient and professional manner. Sylvan will have full and complete authority to engage, dismiss, reprimand, or otherwise manage all Sylvan Shared Services Personnel. The Purchaser expressly understands and agrees that such actions
by Sylvan with respect to Sylvan Shared Services Personnel shall be in accordance with Sylvan’s human resources policies in effect from time to 
  

 time. The Purchaser shall have no authority pursuant to this Agreement with respect to any aspect of Sylvan’s
business or administrative policies. 
  
 (d) If the
Purchaser shall reasonably determine that Sylvan Shared Services Personnel providing the Seller Shared Services hereunder are ineffective, upon reasonable written request Sylvan shall, as promptly as is practical, provide substitute Sylvan Shared
Services Personnel or take appropriate steps to ensure that Sylvan Shared Services Personnel performing the Seller Shared Services effectively perform said services. Nothing in this Section 3(d) shall require Sylvan to hire additional employees or
consultants to serve as Sylvan Shared Services Personnel. 
  
 (e) Prior to the end of each calendar year, Purchaser and Sylvan shall agree in writing upon service level agreements for the Purchaser Shared Services. Service level agreements in effect at the time of the transaction close will be
in effect for fiscal 2003. 
  
 Section
4.    Fees and Payments. 
  
 (a)
The fees and expenses to be paid by Sylvan in respect of the Purchaser Shared Services provided under this Agreement shall be as set forth in Exhibits A-2 and C (Exhibit C contains fees for Purchaser Shared Services and Exhibit A-2 contains
expenses which will be billed separately) hereto, as the same may be amended by written agreement of the parties from time to time. The fees and expenses to be paid by the Purchaser in respect of the Seller Shared Services provided under this
Agreement shall be as set forth in Exhibits B-2 and C hereto, (Exhibit C contains Seller Shared Services and Exhibit B-2 contains expenses which will be billed separately) as the same may be amended by mutual written agreement of the parties from
time to time. The fees and expenses provided for in this Section 4 are referred to herein as the “Fees”. Sylvan and Purchaser shall pay in advance on the first day of every month for such month, without prior notice or demand and without
offset or reduction, as service payment the monthly sum equal to the shared service fees detailed on Exhibit C hereto or any amended amounts attributable to increases in service level as described in Section 4(c) during the term of this agreement.
Such payment shall be delivered to the following address: 
  

			
	 Purchaser: Educate Operating Company, LLC
 1001 Fleet Street
 Baltimore, MD 21202
 Attention: Kevin E. Shaffer
 Facsimile: (410) 843-2139
	 	 Sylvan: Sylvan Learning Systems, Inc.
 1001 Fleet Street
 Baltimore, MD 21202
 Attn: Sean R.
Creamer
 Facsimile: (410) 843-8303

  
 (b) Fees and
payments not paid or not reasonably disputed within thirty days of the date such payment was due shall accrue simple interest at the prime rate as quoted in the Wall Street Journal plus one percent per annum or, if lower, the maximum rate permitted
by law. At any time after the expiration of the thirty-day grace period, the party that has not received payment may demand payment by providing written notice to the non-paying party. In the event either party gives such notice to the other party
and the receiving party does not cure such non-payment within ten Business Days of the date of such notice, the providing party shall have no further obligation to the receiving party, with respect to the provision of the Shared Services, and may
seek any other remedies available to it, whether legal, contractual, equitable or otherwise. 
  

 (c) All fees assume that the recipient’s service volume in each Shared Service category,
taken individually, does not increase by more than 10% from the Base Service Volume as defined in Exhibit D. If the rolling twelve -month service volume for any Shared Service category measured as of the end of each three month period during the
Term of the Agreement is greater than the Base Service Volume by more than 10%, the Fees for each such increased Shared Service category, taken individually, will be adjusted upward by the percentage change in excess of 10% from the Base Service
Volume (each such individual increase the “Periodic Fee Increase” and all such individual increases the “Cumulative Periodic Fee Increase”). If the rolling twelve month service volume for any Shared Service category measured as
of the end of each three month period during the Term of the Agreement is less than the volume during the preceding three month period by more than 10%, the Fees for each such decreased Shared Service category, taken individually, will be adjusted
downward by the percentage change in excess of 10% from such prior period volume (“Periodic Fee Decrease”) but in no case will the fees be reduced below the fees set forth with respect to the Base Service Volume.  
  
 (d) Walden E-Learning, Inc. (“Walden”) and the National
Technological University (“NTU”) are included in the scope of this Shared Services Agreement and any other Ventures entities will maintain separate agreements, if any, for any Shared Services. 
  
 (e) Additional usage based service charges including but not limited
to PeopleSoft customized systems enhancements, centralized recruiting fees on a success fee basis, and Website support “Cost Per Inquiry” and “Cost Per Enrollment” fees are charged outside the scope of this arrangement on a usage
basis as agreed on an individual basis. 
  
 (f) This
Agreement is based upon existing financial reporting platforms (i.e. PeopleSoft 7.52) and any costs to perform material system upgrades or changes to the current system would require additional charges. The parties agree to negotiate in good faith
an addendum to this Agreement to determine those charges, and each party shall use its reasonable best efforts to provide the services outlined herein following any modification or upgrade of such party’s systems and financial reporting
platforms. 
  
 (g) Unless this Agreement is terminated
pursuant to the terms hereof, each party shall be required to make the requisite payments under this Agreement during the Term, even if such party shall have ceased to require any of the Shared Services from the other party. 
  
 Section 5.    Independent
Contractors.    Each of the Purchaser and Sylvan are and shall remain at all times an independent contractor of the other, and neither the Purchaser nor Sylvan are a partner, joint venture, employee, agent or representative
of the other. Persons rendering Shared Services pursuant to this Agreement shall not be deemed employees of the party to which such services are rendered, and shall not be entitled to and are not qualified under any employee benefit plans, including
but not limited to pension, health and insurance plans, provided by such party for its employees. Neither party nor its employees is authorized and neither party nor its employees, agents or representatives shall at any time attempt to act on behalf
of the other party to bind the other party in any manner whatsoever to any obligations except as may be authorized under a separate signed agreement. Neither party nor its employees, agents or representatives shall engage in any acts which may
reasonably lead any person to believe that such party is a partner, joint venture, employee, agent or representative of the other 
  

 party, its parent corporation, subsidiaries or affiliates. Each of the Purchaser and Sylvan agree to give prompt written
notice to the other party upon learning of any confusion by any third party as to the relationship of the Purchaser and Sylvan. 
  
 Section 6.    Indemnification 
  

(a) Indemnification of the Purchaser . Sylvan hereby agrees to indemnify, defend, and hold harmless the Purchaser and its stockholders,
officers, directors, employees, agents, subsidiaries, successors, Affiliates and assigns (collectively, the “Purchaser Indemnities”), from and against all demands, claims, actions, or causes of action, assessments, losses, damages,
liabilities, costs and expenses (including, without limitation, interest, penalties, and reasonable attorneys’ fees), of any nature, whether absolute, contingent or otherwise (collectively, “Losses”), asserted against or imposed upon
or incurred by the Purchaser Indemnities relating to the Purchaser Shared Services, excepting that Sylvan shall not be required to indemnify the Purchaser Indemnities for any Losses principally arising from any act of willful misconduct or gross
negligence by any of the Purchaser Indemnities. 
  
 (b)
Indemnification of Sylvan. The Purchaser hereby agrees to indemnify, defend, and hold harmless Sylvan and its stockholders, officers, directors, employees, agents, subsidiaries, successors, Affiliates and assigns, (collectively, the “Sylvan
Indemnities”) from and against all Losses asserted against or imposed upon or incurred by the Sylvan Indemnities relating to the Seller Shared Services, excepting that Purchaser shall not be required to indemnify the Sylvan Indemnities for any
Losses principally arising from any act of willful misconduct or gross negligence by any of the Sylvan Indemnities. 
  
 (c) Notice of Claim; Defense. The Purchaser Indemnities or Sylvan Indemnities, as the case may be (the “Indemnified Party”) shall give
Sylvan or the Purchaser, as the case may be (the “Indemnifying Party”) prompt notice of any third-party claim that may give rise to any indemnification obligation under this Section 6, together with the estimated amount of such claim, and
the Indemnifying Party shall have the right to assume the defense (at the Indemnifying Party’s expense) of any such claim through counsel of the Indemnifying Party’s own choosing by so notifying the Indemnified Party within 30 days of the
first receipt by the Indemnifying Party of such notice from the Indemnified Party; provided, however, that any such counsel shall be reasonably satisfactory to the Indemnified Party. Failure to give such notice shall not affect the indemnification
obligations hereunder in the absence of actual and material prejudice. If the Indemnifying Party chooses to defend or prosecute a third-party claim, the Indemnified Party shall cooperate in the defense or prosecution thereof, which cooperation shall
include, to the extent reasonably requested by the Indemnifying Party, the retention, and the provision to the Indemnifying Party, of records and information reasonably relevant to such third-party claim, and making employees of the Indemnified
Party available on a mutually convenient basis to provide additional information and explanation of any materials provided hereunder. 
  
 Section 7.    Notice of Possible Liability.    Each party hereto shall promptly furnish to the other
party the details of any event(s) which may give rise to a claim arising out of any of the Shared Services, and shall cooperate with any reasonable request to furnish additional details, if any, to the other party concerning any claim filed against
a party, promptly upon receiving notice 
  

 thereof; provided, that failure to provide such notice shall not release a party from its indemnification obligations
hereunder except to the extent that such party is materially prejudiced by such delay. 
  
 Section 8.    Assignment; Binding Effect.    This Agreement, and the rights and obligations hereunder of the parties hereto, shall not be assigned or delegated (by
operation of law or otherwise) in whole or in part by either party hereto without the prior written consent of the other party hereto, provided that no consent shall be required in connection with (a) the assignment of the Agreement to a third party
as a result of the acquisition of either party hereto of substantially all of its business by such third party by merger, consolidation, sale of assets or otherwise or (b) any assignment of the Agreement to a direct or indirect Subsidiary of any
party hereto as long as such Subsidiary remains a direct or indirect Subsidiary of such party and the assigning party remains liable with respect to the obligations hereunder. Any attempted assignment in violation of this Section 8 shall be void.
Subject to the foregoing restrictions, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. 
  
 Section 9.    Severability.    If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially adverse to either party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible. 
  
 Section 10.    Dispute
Resolution.    In the event any disagreement should arise between the parties, whether as to the interpretation or operation of this Agreement, or any rights or obligations hereunder, each party shall cause a senior
executive of such party to negotiate in good faith to resolve such disagreement for a period of not less than 30 days. If after such negotiation period, the parties remain unable to resolve the disagreement, such disagreement shall be finally
settled in Maryland under the commercial arbitration rules of the American Arbitration Association. This Section shall not limit the right of either party to seek a temporary restraining order or other injunctive relief from a court of law. Each
party shall continue to provide Shared Services during any period of dispute resolution that occurs within the Term of this Agreement. 
  
 Section 11.    Limitation on Damages.    Neither party will be liable for, and each party hereby
waives and releases any claims against the other party for, any special, incidental, or consequential damages, including, without limitation, lost revenues, lost profit, or loss of prospective advantage, resulting from performance or failure to
perform under this Agreement; provided, that such waiver and release shall not reduce either party’s obligations to indemnify the other party under Section 6 hereof for any Losses. 
  
 Section 12.    Force Majeure.    Neither party shall be liable for any
interruption of the provision of Shared Services, delay or failure to perform under this Agreement when such 
  

 interruption, delay or failure results from causes beyond its reasonable control or from any act or failure to act of the
other party, or as a result of strikes, lock-outs or other labor difficulties; acts of government, riot, insurrection or other hostilities; embargo, fuel or energy shortage, fire, flood, acts of God, wrecks or transportation delays; or inability to
obtain necessary labor, materials or utilities from usual sources. In such event, each party’s obligations hereunder shall be postponed for such time as its performance is suspended or delayed on account thereof. Upon the cessation of the force
majeure event, each party will use reasonable best efforts to resume its performance with the least possible delay. 
  
 Section 13.    Available Remedies.    The parties hereto agree that the failure of either of them to
perform any obligation which arises under this Agreement may not be fully or adequately compensated by the award and/or payment of monetary damages. Therefore, they agree that each of them shall be subject to any decree of specific performance,
injunction, or any other applicable equitable or legal decree, order, writ, or remedy, the effect of which shall be to require performance by either or both of the parties in accordance with the provisions of this Agreement. In the event of a breach
or threatened breach by either party of any of the covenants set forth in this Agreement, the other party shall be entitled to an injunction restraining the party breaching or threatening to breach such covenants, and any person acting in concert
with such party, from breaching or attempting in any manner to violate any of the provisions of this Agreement. Nothing herein shall be construed as prohibiting either party from pursuing any other remedies available for such breach or threatened
breach, including, without limitation, the recovery of damages, costs, and reasonable attorneys fees from the other. 
  
 Section 14.    Confidentiality.    All information, documents, data and records belonging to or
obtained from or through the other party, in connection with the performance of this Agreement shall be deemed Confidential Information of the party to which it belongs or from which it was obtained and shall be subject to the Confidentiality
Agreement dated January 30, 2003 between Sylvan and Apollo Management, L.P. 
  
 Section 15.     Notices.    All notices, which are required or may be given pursuant to the terms of this Agreement shall be deemed to have been duly given if such
notice is given in accordance with the terms of Section 11.3 of the Purchase Agreement. 
  
 Section 16.    Amendments, Supplements, Etc.    At any time, this Agreement or the Exhibits hereto may be amended or supplemented by such additional agreements,
articles, exhibits or schedules as may be mutually determined by the parties hereto to be necessary, desirable or expedient to further the purposes of this Agreement, or to clarify the intention of the parties hereto, or to add to or modify the
covenants, terms or conditions hereof or to effect or facilitate any governmental approval or acceptance of this Agreement or the consummation of any of the transactions contemplated hereby. Any such instrument must be in writing and signed by the
Chief Financial Officer or Chief Executive Officer of both of the parties hereto. 
  
 Section 17.    Waiver.    Any waiver of any term of this Agreement must be in writing and signed by the party against whom enforcement of the waiver is sought. No
waiver of any condition, or of the breach of any provision hereof, in any one or more instances, shall be deemed to be a further or continuing waiver of such condition or breach. Any delay or failure to exercise any right or remedy shall not be
deemed the waiver thereof. 
  

 Section 18.    Exhibits.    The terms and
conditions of the Exhibits to this Agreement are incorporated herein by reference and shall constitute part of this Agreement as if fully set forth herein. 
  
 Section 19.    Entire Agreement.    This Agreement and any Exhibits attached hereto, together with
the Purchase Agreement, its exhibits, schedules and annexes, and the documents executed in connection herewith and therewith, constitute the entire agreement between the parties hereto with respect to the subject matter hereof and supersede all
prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof. No representation, warranty, promise, inducement or statement of intention has been made by either party which is not
embodied in this Agreement or the Purchase Agreement (or the agreements contemplated by the Purchase Agreement), and neither party shall be bound by, or be liable for, any alleged representation, warranty, promise, inducement or statement of
intention not embodied herein or therein. 
  
 Section
20.    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws of the State of Maryland regardless of the laws that might otherwise govern under principles of
conflicts of laws applicable hereto. 
  
 Section
21.    Headings.    The headings appearing at the beginning of several sections contained herein have been inserted for identification and reference purposes and shall not be used to determine the
construction or interpretation of this Agreement. 
  
 Section
22.    Counterparts.    This Agreement may be executed in counterpart copies, all of which when taken together shall be deemed to constitute one and the same original instruments. 
  
  

 IN WITNESS WHEREOF, the parties have executed and delivered this SHARED SERVICES AGREEMENT
as of the day and year first above written. 
  
 SYLVAN LEARNING SYSTEMS, INC. 
  
  
 By: /s/ Sean R.
Creamer                             
  
 Name: Sean R.
Creamer                             
  
 Title: Senior Vice President and CFO       
  

 EDUCATE OPERATING COMPANY, LLC 
  
  
 By: /s/ Aaron
Stone                                       
      
  
 Name:
Aaron
Stone                                       
      
  
 Title:
Vice
President                                       
    
  
  
  
 EDUCATE, INC. 
  
  
 By: /s/ Aaron
Stone                                       
      
  
 Name:
Aaron
Stone                                       
      
  
 Title:
Vice
PresidentExhibit 10.6

 Exhibit 10.6 
  
 PATENT LICENSE AGREEMENT 
  
 THIS PATENT LICENSE AGREEMENT executed on this 30th day of June, 2003, by and between SYLVAN LEARNING SYSTEMS INC., a Delaware corporation, having its
offices at 1001 Fleet Street, Baltimore, Maryland 21202, itself and on behalf of its successors and assigns (hereinafter collectively referred to as Sylvan), and EDUCATE, INC., a Delaware corporation, having its offices at 1001 Fleet Street,
Baltimore, Maryland 21202, itself and on behalf of its successors and assigns (hereinafter collectively referred to as Educate), either or both of which may also hereinafter be referred to as the “Party” or “Parties,”
respectively. 
  
 RECITALS 
  
 WHEREAS, each Party owns certain patents and patent applications, as
hereinafter defined, relating to various educational systems and methods; and 
  
 WHEREAS, pursuant to ASSET PURCHASE AGREEMENT, the Parties desire to enter into a royalty-free cross-licence agreement with respect to their respective patents and patent applications to produce, offer, use,
import, offer for sale and sell products and services in mutually agreed upon fields of use, as hereinafter defined; 
  
 NOW THEREFORE, in consideration of these premises and mutual covenants contained herein, the Parties agree as follows: 
  
 ARTICLE 1- DEFINITIONS 
  

	1.1	ASSET PURCHASE AGREEMENT shall mean the purchase agreement between Sylvan and Educate and other parties dated March 10, 2003. 

  

	1.2	LICENSED PATENT(S) shall mean any one or more than one of the SYLVAN LICENSED PATENTS or EDUCATE LICENSED PATENTS. 

  

	1.3	SYLVAN LICENSED PATENTS shall mean any and all patents and patent applications of any type that 1) is owned by Sylvan or in which Sylvan has any ownership right or interest,
2) 

	  	is originally filed with a patent office anywhere in the world on a date prior to DATE of this AGREEMENT, including but not limitted to any later filed continuation,
continuation-in-part or divisional application that is subject to a right of priority to an originally filed application filed prior to DATE of this AGREEMENT, and 3) covers any learning or educational technologies, systems and method, and all
foreign counterparts of any such patents and patent applications anywhere in the world, including but not limited to those patents and patent applications listed in Appendix A of this AGREEMENT. 

  

	1.4	EDUCATE LICENSED PATENTS shall mean any and all patents and patent applications of any type that 1) is owned by Educate or in which Educate has any ownership right or
interest, 2) is originally filed with a patent office anywhere in the world on a date prior to DATE of this AGREEMENT, including but not limitted to any later filed continuation, continuation-in-part or divisional application that is subject to a
right of priority to an originally filed application filed prior to DATE of this AGREEMENT, and 3) covers any learning or educational technologies, systems and method and all foreign counterparts of any such patents and patent applications anywhere
in the world, including but not limited to those patents and patent applications listed in Appendix B of this AGREEMENT. 

  

	1.5	SYLVAN FIELD OF USE shall mean any application, product or service that relates to offering any educational course or instructional material to students at the college level,
university level, or higher level that is covered by the EDUCATE LICENSED PATENTS. 

  

	1.6	EDUCATE FIELD OF USE shall mean any application, product or service that relates to offering any educational course or instructional material to students attending
Kindergarten through 12th grade (K-12) that is covered by the SYLVAN LICENSED PATENTS. 

  

	1.7	PERSON shall mean any natural person, corporation, general partnership, limited partnership, limited liability company, limited liability partnership, proprietorship, trust,
union, association, court, tribunal, agency, government, department, commission, self-regulatory organization, arbitrator, board, bureau, instrumentality or other entity, enterprise, authority or business organization. 

  

 -2- 

 ARTICLE 2 - LICENSE GRANT 
  

	2.1	Sylvan License Grant. Sylvan hereby grants to Educate and Educate hereby accepts upon the terms and conditions hereinafter specified, a non-exclusive, irrevocable
(except as herein provided), worldwide, non-transferable (except as herein provided), fully paid-up royalty-free right and license to use, make, have made, sell, offer to sell and import any product or service covered by the SYLVAN LICENSED PATENTS
in the EDUCATE FIELD OF USE only, without the right to sublicense.  

  

	2.2	The foregoing licenses and rights expressly granted under this AGREEMENT shall apply, and are hereby licensed to apply, in the EDUCATE FIELD OF USE only, to customers,
potential customers, clients and potential clients of Educate itself and its successors and assigns and any users of Educate products or services.  

  

	2.3	Educate acknowledges and agrees that Sylvan expressly reserves all rights to SYLVAN LICENSED PATENTS, other than the licenses and rights expressly granted to Educate pursuant
to this Article 2. 

  

	2.4	Educate further acknowledges and agrees that Sylvan’s reserved rights include without limitation the right to further license SYLVAN LICENSED PATENTS to others both
within and outside the EDUCATE FIELD OF USE. 

  

	2.5	Subject to provision of Section 2.2, Educate acknowledges and agrees that the granted licenses and rights to SYLVAN LICENSED PATENTS pursuant to this AGREEMENT expressly
exclude the right to make any sublicense of any of the licenses and rights granted under this AGREEMENT. 

  

	2.6	Subject to provisions of ASSET PURCHASE AGREEMENT, nothing contained herein shall be construed as granting a license to Educate under any other intellectual property right of
Sylvan, tangible or intangible, including without limitation, copyrights, trademarks and trade secrets, except as specifically set forth herein. 

  

	2.7	Educate License Grant. Educate hereby grants to Sylvan and Sylvan hereby accepts upon the terms and conditions hereinafter specified, a non-exclusive, irrevocable
(except as herein provided), worldwide, non-transferable (except as herein provided), fully paid-up, royalty- 

  

 -3- 

	  	free right and license to use, make, have made, sell, offer to sell and import any product or service covered by the EDUCATE LICENSED PATENTS in the SYLVAN FIELD OF USE only,
without the right to sublicense. 

  

	2.8	The foregoing licenses and rights expressly granted under this AGREEMENT shall apply and are hereby licensed to apply, in SYLVAN FIELD OF USE only, to customers, potential
customers, clients and potential clients, of Sylvan itself and its successors and assigns and any user of Sylvan products or services in the SYLVAN FIELD OF USE only. 

  

	2.9	Sylvan acknowledges and agrees that Educate expressly reserves all rights to EDUCATE LICENSED PATENTS, other than the licenses and rights expressly granted to Sylvan pursuant
to this Article 2. 

  

	2.10	Sylvan further acknowledges and agrees that Educate’s reserved rights include without limitation the right to further license EDUCATE LICENSED PATENTS to others both
within and outside of the SYLVAN FIELD OF USE. 

  

	2.11	Subject to provision of Section 2.8, Sylvan acknowledges and agrees that the granted licenses and rights to the EDUCATE LICENSED PATENTS pursuant to this Agreement expressly
exclude the right to make any sublicense of any of the licenses and rights granted to Sylvan under this AGREEMENT. 

  

	2.12	Subject to provisions of ASSET PURCHASE AGREEMENT, nothing contained herein shall be construed as granting a license to Sylvan under any other intellectual property right of
Educate, tangible or intangible, including without limitation, copyrights, trademarks and trade secrets, except as specifically set forth herein. 

  

ARTICLE 3 – MAINTENANCE OF PATENTS 
  

	3.1	Each party shall be responsible in its sole discretion for prosecuting and maintaining the LICENSED PATENTS it owns, including the costs thereof. 

  

	3.2	Each Party acknowledges and agrees that there is no obligation on the part of the other Party to maintain or prevent the lapse of patent rights with respect to the LICENSED

  

 -4- 

	  	PATENTS it owns; provided, however, that if such party determines to cease maintainance of or permit the lapse of patent rights with respect to any or all of the LICENSED PATENTS it
owns, it shall give written notice of such determination to the other party and, if such other party requests, shall transfer all of its right, title and interest in and to such LICENSED PATENTS to the other party for no additional charge.
 

  
 ARTICLE 4 - RELEASES AND
COVENANT NOT TO ASSERT 
  

	4.1	Each Party hereby releases and forever discharges the other Party and its successors and assigns from any and all claims, liens, demands, causes of action, obligations,
losses, damages, and liabilities, known or unknown, suspected or unsuspected, liquidated or unliquidated, fixed or contingent, that it has had in the past or now have under any of its LICENSED PATENTS based on or arising out of the making, having
made, use, sale, offering for sale or importing of any products or services prior to DATE of AGREEMENT regardless of when any one of its LICENSED PATENTS is issued or comes into effect. 

  

	4.2	Each Party hereby agrees that with respect to any issued patent and any patent other than its LICENSED PATENTS that may issue based on a patent application of any type that
it has any ownership right to and that is originally filed with a patent office anywhere around the world prior to DATE of this AGREEMENT, including but not limited to patents issued based on any pending or later filed continuation,
continuation-in-part or divisional application that claim priority to an originally filed patent or patent application filed prior to DATE of this AGREEMENT, it will not assert against the other Party, its customers and clients, any claims of patent
infringement with respect to such issued patents. 

  

	4.3	Each Party hereby agrees that with respect to any patent other than its LICENSED PATENTS or any patent that may issue based on a patent application of any type that it has
any ownership right to and that is originally filed with a patent office anywhere around the world after the DATE of this AGREEMENT, it will enter into negotiation, in good faith, with respect to potential terms and conditions for licensing any such
patent and patent application and hereby agrees to license such patent and patent application in accordance with the terms and conditions, if mutually agreed upon by the parties. 

  

 -5- 

 ARTICLE 5 - TERMINATION 
  

	5.1	This AGREEMENT shall remain in force and effect until the last claim of any LICENSED PATENT shall expire or until a final decree of invalidity thereof from which no appeal or
other judicial recourse can be, or is, taken. 

  

	5.2	If a Party commits a material breach of this AGREEMENT and fails to remedy such breach within ninety (90) days after receipt of written notice thereof, the non-breaching
Party may, at its option, and in addition to any other remedies to which it may be entitled, terminate this AGREEMENT by written notice to the breaching Party. 

  

	5.3	Upon termination of this AGREEMENT, the rights and licenses granted hereunder by the non-breaching Party to the breaching Party shall terminate, revoke and expire, while the
rights and licenses granted hereunder by the breaching Party to the non-breaching Party shall remain in full force and effect. 

  

	5.4	Those provisions that expressly or by their nature survive shall survive termination of this AGREEMENT. Such termination shall not be exclusive of any other legal or
equitable remedies or means of redress to which the breaching Party may be lawfully entitled, it being intended that all such remedies be cumulative. 

  
 ARTICLE 6 – WARRANTIES AND REPRESENTATIONS 
  

	6.1	Each Party hereby represents and warrants that it is the owner of its LICENSED PATENTS and that it has the legal power to extend the rights granted under this AGREEMENT and
that it has not made any commitments to others inconsistent with or in derogation of such rights. 

  

	6.2	Each Party hereby represents and warrants that it is not aware of any pending or threatened litigation involving any of its LICENSED PATENTS. 

  

 -6- 

	6.3	Except as set forth herein, each Party makes no express or implied warranty or representation with respect to its LICENSED PATENTS, including without limitation any warranty or
representation regarding the scope, validity, usefulness, merchantability, functional effectiveness, safety, performance or fitness for any particular use with any products or services covered by its LICENSED PATENTS. 

  

	6.4	No representation or warranty is made by either Party that any product or service manufactured, used, sold or otherwise disposed of by the other Party under this AGREEMENT will not
infringe directly, contributorily or by inducement under the laws of the United States or any foreign country, patent or other intellectual property right owned or controlled by any third party and neither Party shall be liable either directly or as
an indemnitor of of the other Party as a consequence of any infringement of any such third party patents. 

  

	6.5	Except as set forth herein, each Party represents and warrants that in executing this AGREEMENT, it does not rely on any promises, inducements, or representations made by any
party or third party with respect to this AGREEMENT or any other business dealings with any party or third party, now or in the future. 

  

	6.6	Other than the express warranties of this Article, there are no other warranties, express or implied or statutory. 

  
 ARTICLE 7 - INFRINGEMENT BY THIRD PARTIES 
  

	7.1	Each Party agrees to notify the other Party as reasonably as possible when it becomes aware of infringement by a third party of any LICENSED PATENTS owned by the other
Party. Neither Party has any obligation to to take steps to investigate or stop such third party infringement, including initiating legal action against the infringer. 

  

 -7- 

 ARTICLE 8 - INDEMNIFICATION 
  
 Subject to limitation of liability set forth in Article 9, each Party agrees to indemnify, defend and hold the other Party, and its
officers, directors, shareholders, employees, agents, and representatives (each an “Indemnified Party”) harmless from and against any and all actions, suits, damages, claims, losses, costs, liabilities and expenses (including reasonable
Attorneys’ Fees), arising as a result of or in connection with any third party claim caused by or arising from a Party’s breach of any of the representations or warranties in Article 6 provided: (i) the Indemnified Party promptly gives
written notice of any claim to the indemnifying Party; (ii) at the indemnifying Party’s expense, the Indemnified party provides any assistance which the indemnifying Party may reasonably request for the defense of the claim; and (iii) the
indemnifying Party has the right to control of the defense of the claim, provided, however, that the Indemnified Party shall have the right to participate in, but not control, any litigation for which indemnification is sought with counsel of its
own choosing, at its own expense. 
  
 ARTICLE 9 - LIMITATION OF
LIABILITY 
  
 EXCEPT FOR THE INDEMNIFICATION OBLIGATIONS SET FORTH IN ARTICLE
8, IN NO EVENT SHALL ANY PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES SUFFERED OR INCURRED IN CONNECTION WITH THIS AGREEMENT OR THE LICENSES GRANTED HEREUNDER. 
  
 ARTICLE 10 - MISCELLANEOUS 
  

	10.1	No Implied Partnership. Nothing herein shall constitute or be deemed to constitute a joint venture, association, partnership, agency or other relationship between the
Parties or to impose any obligation or liability upon either of the Parties based on such relationship. 

  

 -8- 

	10.3	Notices. Unless otherwise provided in this AGREEMENT, all notices required or permitted hereunder shall be deemed to have been given when transmitted in writing and
delivered by certified mail prepaid (return receipt requested), telex or facsimile or telegram transmission (with acknowledged receipt) to the parties at the following addresses (or at such other address as a party may specify by notice to the
other): 

  

			
	 If to Sylvan:
	 	 Attn: General Counsel,

	 	 	 Sylvan, Inc.

	 	 	 1001 Fleet Street

	 	 	 Baltimore, MD 21202

		
	 If to Educate:
	 	 Attn: General Counsel,

	 	 	 Educate, Inc.

	 	 	 1001 Fleet Street

	 	 	 Baltimore, MD 21202

  

	10.4	Entire Agreement. The terms and conditions set forth in this AGREEMENT, and the Appendices attached hereto and incorporated herein by reference,
constitute the entire agreement between the Parties with respect to the subject matter hereof, and supersede all previous and contemporaneous agreements and understandings, whether oral or written, between the Parties with respect to the subject
matter hereof. With respect to any conflicting provisions between this AGREEMENT and ASSET PURCHASE AGREEMENT relating to patent rights and licenses only, the provisions of this AGREEMENT supercede that of ASSET PURCHASE AGREEMENT.

  

	10.5	Assignment. None of the Parties shall assign or delegate this AGREEMENT, or any of its rights or duties hereunder, directly or indirectly, to any Person without the
prior written consent of the other Party, such consent not to be unreasonably witheld, and any act in derogation of the foregoing shall be null and void. Subject to the foregoing, this 

  

 -9- 

 AGREEMENT shall be binding upon, and shall inure to the benefit of, the Parties and their respective
successors and assigns. 
  

	10.6	Amendment. No alteration, amendment, waiver, cancellation or any other change in any term or condition of this AGREEMENT (including, without limitation, the Appendices
attached hereto) shall be valid or binding on either Party unless mutually assented to in writing by both Parties. 

  

	10.7	No Waiver. The failure of any Party to enforce at any time any of the provisions of this AGREEMENT, or the failure to require at any time performance by any Party of
any of the provisions of this AGREEMENT, shall in no way be construed to be a present or future waiver of such provisions, nor in any way affect the ability of a Party to enforce each and every such provision thereafter. 

  

	10.8	Governing Law. The laws of the State of Maryland (irrespective of its choice of law principles) and applicable federal law shall govern this AGREEMENT, including the
construction of its terms and the interpretation and enforcement of the rights and duties of the Parties. 

  

	10.9	Exclusivity. This AGREEMENT is not exclusive. Each Party may enter into negotiations or agreements with any third parties concerning the subject matter hereof, without
any accounting or liability to the other Party, other than as expressly provided for herein. 

  

	10.10	Disputes. 

  
 (a) The Parties shall use their best efforts to resolve amicably any and all disputes, controversies, claims or differences (“DISPUTES”)
relating to this AGREEMENT. If either Party gives written notice to the other Party that a DISPUTE has arisen, and the Parties are unable within five (5) days of such written notice to resolve the DISPUTE, then it shall be referred to the Chief
Executive Officers (or their designees) of the respective 
  

 -10- 

 Parties. If the Chief Executive Officers (or their designees) of the respective Parties are unable within
five (5) days to resolve the DISPUTE, then either Party may submit the DISPUTE to arbitration in accordance with the provisions of this Article 10.10(b). 
  
 (b) Any DISPUTE that is not resolved pursuant to Article 10.10(a), shall be resolved by binding arbitration, which shall be administered by the American
Arbitration Association (“AAA”) and shall be conducted in accordance with the Commercial Arbitration Rules of the AAA (the “RULES”), as such RULES may be amended from time to time, with the hearing locale to be Baltimore,
Maryland, unless some other location and/or arbitrator are chosen by mutual consent of the Parties. A single neutral arbitrator (the “ARBITRATOR”) shall preside over the arbitration and decide the Dispute (the “DECISION”). The
AAA shall use its normal procedures pursuant to the Rules for selection of the ARBITRATOR. The DECISION shall be binding, and the prevailing Party may enforce such decision in any court of competent jurisdiction. The Parties shall cooperate with
each other in causing the arbitration to be held in as efficient and expeditious a manner as practicable and, in this connection, to furnish such documents and make available such Persons as the ARBITRATOR may request. The Parties have selected
arbitration in order to expedite the resolution of DISPUTES and to reduce the costs and burdens associated with litigation. The Parties agree that the ARBITRATOR should take these concerns into account when determining whether to authorize discovery
and, if so, the scope of permissible discovery and other hearing and pre-hearing procedures. Without limiting any other remedies that may be available under applicable law, the ARBITRATOR shall have no authority to award punitive damages. The
ARBITRATOR shall render a DECISION within ninety (90) days after accepting an appointment to serve as ARBITRATOR unless the Parties otherwise agree or the ARBITRATOR makes a finding that a Party has carried the burden of showing good cause for a
longer period. All proceedings and decisions of the ARBITRATOR shall be maintained in confidence, to the extent legally permissible, and shall not be made public by any Party or any ARBITRATOR without the prior written consent of all Parties to the
arbitration, except as may be required by law. The expenses of the arbitration shall be 

  

 -11- 

 
borne by the non-prevailing party to the arbitration, including, but not limited to, the cost of experts, evidence and legal counsel. 
  

	10.11	Severability. If, for any reason, a court of competent jurisdiction finds any provision of this AGREEMENT, or portion thereof, to be invalid or unenforceable, such
provision of the AGREEMENT shall be deemed modified with retroactive effect to render such provision valid and enforceable to the maximum extent permissible so as to effect the intent of the Parties, and the remainder of this AGREEMENT shall
continue in full force and effect. If such court will not so modify such provision, the Parties agree to negotiate in good faith an enforceable substitute provision for any invalid or unenforceable provision that most nearly achieves the intent and
economic effect of such provision. 

  

	10.12	Representation by Counsel. Each of the Parties acknowledges that (i) it has read this AGREEMENT in its entirety and understands all of its terms and conditions, (ii)
it has had the opportunity to consult with any individuals of its choice regarding its agreement to the provisions contained herein, including legal counsel of its choice, and any decision not to was its alone, and (iii) it is entering into this
AGREEMENT of its own free will, without coercion from any source. 

  

	10.13	Interpretation. The Parties and their respective legal counsel actively participated in the negotiation and drafting of this AGREEMENT, and in the event of any
ambiguity or mistake herein, or any dispute among the Parties with respect to the provisions hereto, no provision of this AGREEMENT shall be construed unfavorably against any of the Parties on the ground that it, or its counsel was the drafter
thereof. This AGREEMENT is not intended to, and shall not, confer upon any Person (other than the Parties) any rights or remedies with respect to the subject matter hereof. 

  

	10.14	Counterparts. This AGREEMENT may be executed in counterparts or duplicate originals, all of which shall be regarded as one and the same instrument.

  

 -12- 

	10.15	Captions and Headings. The captions and headings used in this AGREEMENT are used for convenience only and are not to be given any legal effect.

  

 -13- 

 IN WITNESS WHEREOF, the Parties have caused this AGREEMENT to be executed by their duly authorized
representatives. 
  

							
	SYLVAN LEARNING SYSTEMS INC.	  	EDUCATE INC.
				
	 By:
	  	 /s/ Sean R. Creamer

	  	 By:
	  	 /s/ Aaron Stone

	 	  	 (signature)
	  	 	  	 (signature)

				
	 Name:
	  	 Sean R. Creamer
	  	 Name:
	  	 Aaron Stone

				
	 Title:
	  	 Senior Vice President and CFO
	  	 Title:
	  	 Vice President

				
	 Date:
	  	 June 30, 2003
	  	 Date:
	  	 June 30, 2003

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