Document:

Exhibit
10.1

** 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 as of the commencement
of business on June 1, 2007 (the “Effective Date”) by and among:

New Horizons
Computer Learning Center of Santa Ana, Inc., a Delaware corporation (“Seller”),
together with its direct or indirect parent corporation, New Horizons
Worldwide, Inc. (“Parent”), on the one hand;

KML
Enterprises, Inc., a California corporation (“Buyer”); and

Kevin M.
Landry, a natural person who owns all of the equity of Buyer (“Owner”).

Buyer, Owner
and Seller are hereinafter sometimes individually referred to as a “Party”
or collectively as the “Parties”.

WHEREAS,
Seller wishes to sell to Buyer, and Buyer wishes to purchase from Seller,
substantially all of Seller’s assets related to Seller’s computer training
business located in Anaheim, California (the “Business”); and

WHEREAS,
concurrent with the transactions described in this Agreement, Buyer desires to
become a franchisee of New Horizons Franchising Group, Inc. (“Franchisor”)
in Anaheim, California, it being understood that Franchisor is an affiliate of
Seller and direct or indirect subsidiary of the Parent.

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

Section 1               PURCHASE AND
SALE OF ASSETS; EXCLUDED ASSETS

1.1           Purchased Assets.  Pursuant to the terms and subject to the
conditions set forth in this Agreement, on the Closing Date herein below
provided for but effective as of the Effective Date, Seller hereby agrees to
sell, grant, transfer, convey, assign and deliver to Buyer, and Buyer agrees to
purchase and acquire from Seller, all of the properties, assets and rights
owned, used, acquired for use, or arising or existing in connection with the
Business, whether tangible or intangible, and whether or not recorded on Seller’s
books and records, except for and excluding the Retained Assets provided for in
Section 1.2 below (all the foregoing being collectively referred to as the “Purchased
Assets”).  The Purchased Assets shall
include, but not be limited to, the following:

(A)          Certain rights of Seller under its occupancy leases covering the
premises known as (y) 1900 S. State College Blvd, Suite 100, Anaheim,
California 92806 (the “Anaheim Lease” and (z) 333 North Glenoaks Blvd.,
Suite 401, Burbank, California 91502 (the “Burbank Lease” (each a “Facilities
Lease” and collectively the “Facilities Leases”), a true and
complete copy of each Facilities Lease being included at Schedule 1.1(A) attached hereto;

(B)           All of Seller’s (x) vehicles used in connection with the conduct
of the Business (“Vehicles”), (y) furniture, furnishings,
fixtures, equipment, machinery, trade fixtures, leasehold improvements,
computers, computer discs, telephone systems and security systems (“Equipment”),
and (z) supplies, training and course materials, computer training kits
and manuals, catalogs, advertising copy and other properties of a similar type
used or held for use in the conduct of the Business (“Inventory” and,
together with the Vehicles and Equipment, the “Tangible Personal Property”),
a listing of all of which is included at Schedule
1.1(B) attached hereto;

(C)           All of Seller’s (u) telephone and facsimile numbers, (v)
permits and other governmental authorizations pertaining to the Business, to
the extent such authorizations may legally be assigned (“Governmental
Permits”), (w) goodwill with customers, vendors or prospective
customers, and all customer lists, relating to the conduct of the Business (“Goodwill”),
(x) security or similar deposits relating to the Business (“Deposits”),
(y) prepaid advertising (inclusive of yellow page advertising), prepaid
expenses and other prepayments relating to the conduct of the Business (“Prepayments”),
and (z) all other intangible assets relating to the Business or any of
the Purchased Assets (the foregoing being collectively called the “Intangible
Personal Property”), a listing of all of which is included at Schedule 1.1(C) attached hereto;

(D)          All of Seller’s software (including rights under Seller’s software
licenses) used in the conduct of the Business (“Software”), but
excluding the CMS software otherwise provided for in the Franchise Agreement
(as defined in Section 3.5(B)), a listing of the Software being included at Schedule 1.1(D) attached hereto;

(E)           All of Seller’s accounts and notes receivable, and other rights to
receive payment, from customers, employees or others arising from the conduct
of the Business (“Receivables”), a listing of all of which (showing, as
to each, the name of the account debtor, the amount owed and an aging schedule
thereof) is included at Schedule 1.1(E)
attached hereto;

(F)           All rights of Seller under any agreements or contracts (“Assigned
Contracts”) which (i) were entered into in the ordinary course of the
Business by Seller (excluding those entered into with respect to employment of
any person, insurance agreements and other agreements of a nature and character
as relate exclusively to any of the Retained Assets or Retained Liabilities),
(ii) were entered into in the ordinary course of the Business with customers or
prospective customers which benefit the Business from and after the Effective Date, including, but not limited to, computer
training center agreements, rights to receive payment from customers for
services to be performed and invoiced after the Effective Date, rights to
payment with regard to coupon sales and redemptions, PC Club sales, corporate
technical club sales or applications, and future training classes (“Customer
Contracts”), and (iii) 

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at the election of Buyer
(which Buyer may make by delivery of a writing to Parent at any time before or
after the Effective Date), any agreements entered into by Parent for the
benefit of the Business consistent with practices employed in the operations of
other affiliates of the Parent conducting businesses similar to the Business;
and

(G)           Seller’s book and records, books of account, files, invoices,
accounting records, and correspondence relating to any of the foregoing (“Records”).

1.2           Retained Assets.  Notwithstanding the provisions of Section
1.1, the Purchased Assets shall not include any of the following (the “Retained
Assets”):

(A)          Any
Customer Contracts between Seller’s affiliate and third party customers for the
delivery of training managed through the Enterprise Learning Solutions
department of Seller’s affiliate, provided that Buyer shall be entitled to
deliver training 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;

(B)           Seller’s
cash and cash deposits;

(C)                                Seller’s
rights under this Agreement;

(D)          Seller’s
corporate minute books, stock records and tax returns or other similar
corporate books and Records relating to the Business, to any of the Retained
Assets, to any liability or obligation of the Seller not comprising a part of
the Assumed Liabilities, or to the negotiation and consummation of the transactions
provided for in this Agreement, and those Records originals of which Seller is
required to maintain under applicable law;

(E)           Seller’s rights arising under any
contracts or agreements which are not among the Assigned Contracts;

(F)           Any
rights of Seller relating to its conduct of the Business which arise from or
are related to services previously provided by the regional office of Seller’s
affiliate (such as accounting, payroll, legal or other similar services, except
as otherwise expressly provided herein); and

(G)                                Any
assets of any of Seller’s
affiliates.

Section 2               PURCHASE
PRICE

2.1           Closing Payment.  In consideration for the transfer of the
Purchased Assets, Buyer shall on the Effective Date pay the following amounts
(the “Purchase Price”):

(A)          Cash
Payments.

(1)           The
sum of [**********] (the “Franchisor Cash Payment”) to Franchisor in the
form of a wire transfer or as directed by Seller;

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(2)           The
sum of $24,856.70 (the “Other Cash Payment”) to Seller in the form of a wire
transfer or as directed by Seller, which is comprised of $19,607.70 for the
Burbank Lease security deposit and $5,249.00 for the cost to replace Seller’s
NAVCO Access Control Security System which is otherwise being transferred to
Buyer hereunder (the Franchisor Cash Payment and the Other Cash Payment are
hereinafter collectively the “Cash Payments”);

(B)           Assumption
of Liabilities.  An agreement (the “Assignment
and Assumption Agreement”) in form and content as provided for in Section
3.2(A)(1) obligating Buyer to assume Seller’s obligations with regard to, and to indemnify and hold
harmless the Seller from, the Assumed Liabilities as defined in Section 2.2(A)
below; and

(C)           Execution
of Promissory Note.  Buyer shall
execute a promissory note in form and content substantially as shown on Exhibit A attached hereto (the “Promissory
Note”) pursuant to which, among other things, the Buyer shall pay
Franchisor the principal sum of [**********].

2.2           Assumed and Retained Liabilities.

(A)          Assumed
Liabilities.  The following shall constitute, and are
herein together referred to as, the “Assumed Liabilities”:

(1)           Those liabilities which are (a) identified
on Schedule 2.2(A)(1) attached
hereto (including outstanding purchase orders, trade accounts payable and
accrued liabilities and expenses reflected on said Schedule) and (b) any trade
payables not so listed if (i) Seller does not have “Knowledge” (which
term, when used in reference to any person, means matters which are known to
such persons and matters which might reasonably be discovered by them in the
exercise of due inquiry, excluding inquiry of any adverse party to this
Agreement) thereof, (ii) invoices are delivered to Buyer promptly following
their receipt or discovery, (iii) [********************************************
*********************************************************************************************],
and (iv) such liabilities are listed in the Supplemental Schedule provided for
in Section 3.2(E)(2) (the “Assumed Balance Sheet Liabilities”);

(2)           Subject to the exclusion provided for in
Section 2.2(B)(4)(e), the Seller’s obligations to all individual and corporate
customers to provide training which has been purchased by such customers prior
to the Effective Date but not yet delivered as of the Effective Date (the “Training
Obligations”);

(3)           Any obligation for cash refunds to customers
in respect to any prepaid training, except to the extent such constitutes a
Retained Liability under Section 2.2(B)(4)(e);

(4)           Any obligation to pay for training provided
by any other franchisee or affiliate of the Franchisor in respect to national
training coupons sold by Seller, except to the extent such constitutes a
Retained Liability under Section 2.2(B)(4)(f);

(5)           Any debt, liability or obligation accruing
from and after the Effective Date under or pursuant to any of the Assigned
Contracts;

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(6)           Any debts, liabilities or obligations
incurred by Buyer, or actions, claims or lawsuits asserted against either Buyer
or Seller, which relate to the operation of the Business on or after the Effective
Date; and

(7)           Any claim (and any liability resulting
therefrom) against Seller which is made by a person employed by Seller
immediately prior to the Effective Date which is based solely upon Buyer’s
failure or refusal to make an offer of employment to such person as of the
Effective Date (but excluding claims arising from any other circumstances,
including but not limited to, any agreements existing or alleged to exist
between Seller and any such person, or any claims under the Worker Adjustment
and Retraining Notification Act, 29 U.S.C. §§2101-2109, as amended, or any
claims under the Employee Retirement Income Security Act of 1974, as amended).

(B)           Retained
Liabilities.  Buyer shall not be
obligated to pay, perform or abide by, and Seller shall retain exclusive
responsibility for, any liabilities, debts, obligations, undertakings or
commitments of the Seller (the “Retained
Liabilities”), other than the Assumed Liabilities.  Except for Assumed Balance Sheet Liabilities
identified and set forth on Schedule 2.2(A)(1) (as amended by the Supplemental
Schedule), the Retained Liabilities shall include, but not be limited to, the
following:

(1)           Any sales, use, income, gross receipts,
excise, franchise, employment, withholding or other imposition, duty or tax (each,
a “Tax”) imposed by or payable to any governmental body, federal, state
or local, on or with respect to any period prior to the Effective Date or in
respect to the sale and transfer of the Purchased Assets or the Assumed
Liabilities;

(2)           Any liability or obligation accruing prior
to the Effective Date in respect to (a) any employee benefit plan or any other
employee benefit arrangement or commitment which is or has been maintained or
contributed to by Seller, (b) any portion of any bonuses earned or accrued upon
the basis of any events occurring prior to the Effective Date, (c) any accrued
vacation benefits, or (d) any obligation to reimburse any employee for expenses
incurred prior to the Effective Date;

(3)           Any liability or obligation which, absent
this provision, comprises a part of the Assumed Liabilities but which is
covered by any insurance policy maintained by Seller or any of Seller’s
affiliates (but, then, only to the extent of such insurance coverage);

(4)           Any (a) inter-company charges or amounts due
Parent or any affiliate of Seller or Parent, (b) claims relating to
inter-franchise payment obligations which are based on the non-payment of
amounts owing any other franchisee of the Franchisor, (c) amounts due for
borrowed money, (d) obligations arising under any agreement, instrument or
other contractual undertaking or commitment that is not an Assigned Contract or
which is not an Assumed Liability, (e) obligations to refund prepayments by
customers which Seller received without providing any training prior to the
Effective Date or which prepayments represent duplicate payments, or (f)
inter-franchise obligations relating to payment for training provided by
franchisees of the Franchisor other than the Buyer or its affiliates upon
redemption of national 

 5
 

training coupons sold by Seller prior to the Effective Date in
circumstances where same are redeemed more than one (1) year after the issuance
of such coupons;

(5)     [*********************************************************************
************************************************************************************************
************************];

(6)           Any (a) liability or obligation to indemnify
any director, officer, employee or agent of Seller, except with regard to
indemnification obligations owed to Seller or Parent from Buyer and/or Owners
arising under this Agreement, (b) liability arising out of or in connection
with any violation of a statute or governmental rule, regulation, directive or
other requirement, and any liability or obligation of a conditional, contingent
or similar nature except for matters which arise from or relate to a breach of
the Owner Business Representations (as defined and further described in Section
6.3 below), or (c) liability or obligation which arises from or is based on a
claim for injury to or death of persons, or damage to or destruction of
property, regardless of when asserted, but which arises from facts or
circumstances which occurred prior to the Effective Date;

(7)           The obligations of Seller, Parent or their
affiliate(s) on any guaranty of the Facilities Lease (but subject to the
provisions set forth in Section 4.1); and

(8)           Any debts, liabilities or obligations
incurred by Seller, or actions, claims or lawsuits asserted against either
Buyer or Seller which relate to the operation of the Business prior to the
Effective Date, except for matters which arise from or relate to (x) a
breach of the Owner Business Representations (as defined and further described
in Section 6.3 below), (y) the Assumed Liabilities, and/or (z)
the Training Obligations.

Section 3               CLOSING AND
CLOSING DATE

3.1           Closing Date.  The consummation of the transactions provided
for in this Agreement (the “Closing”) has been held on the date of this
Agreement (the “Closing Date”) effective as of the Effective Date.

3.2           Acts of Seller and Parent.  At the Closing, Seller and Parent, or
whichever thereof may be required by the circumstances, has taken such actions
and has executed and delivered, or caused to be executed and delivered, to
Buyer such certificates, instruments and documents, as are required by this
Agreement or as are required to give full effect to the transactions provided
for herein.  Such actions and materials
include, but are not be limited to, the following:

(A)          Conveyance
Documentation.  Seller shall execute
and deliver or cause to be executed and delivered, or has executed and
delivered or caused to be executed and delivered, to Buyer (with such
acknowledgments required by the circumstances) documents of conveyance which
are required to convey to Buyer the Purchased
Assets free and clear of all restrictions or conditions to sale, conveyance or
transfer and free and clear of all liens, mortgages, pledges, encumbrances,
charges, claims, security interests, Taxes, conditions or restrictions of any
nature or description whatsoever (“Liens”) (other than those identified
on Schedule 3.2(A) hereto, the “Permitted
Liens”) and consistent with the other requirements of this Agreement.  Except as 

 6
 

otherwise
expressly provided in this Agreement, the Purchased Assets are being sold “as
is, where is” without any express or implied warranties whatsoever.  Without limiting the generality of the
foregoing, the documents of conveyance shall include the following:

(1)           An assignment and assumption agreement (“Assignment
and Assumption Agreement”) in form and content substantially as shown on Exhibit B attached hereto pursuant to
which, among other things, the Seller conveys and assigns to Buyer all right,
title and interest of Seller arising under, provided for in, or governed by any
Assigned Contracts (other than the Facilities Leases);

(2)           An assignment and assumption agreement (“Assignment
of Lease”) in form and content substantially as shown on Exhibit C-1 attached hereto pursuant to
which, among other things, the Seller conveys and assigns to Buyer all right,
title and interest of Seller arising under, provided for in, or governed by the
Burbank Lease, together with which Seller shall deliver a writing signed by the
landlord named in the Burbank Lease or other person whose approval or consent
is required in connection therewith setting forth such person’s consent to said
assignment;

(3)           A sublease agreement (the “Sublease”) in
form and content substantially as shown on Exhibit
C-2 attached hereto pursuant to which, among other things, the
Seller subleases to Buyer certain interests of Seller arising under, provided
for in, or governed by the Anaheim Lease, together with which Seller shall
deliver a writing signed by the landlord named in the Anaheim Lease or other
person whose approval or consent is required in connection therewith setting
forth such person’s consent to the Sublease;

(4)           A bill of sale (“Bill of Sale”) in
form and content substantially as shown on Exhibit
D attached hereto and conveying to Buyer all of the Purchased Assets
(other than as provided for in the Assignment and Assumption Agreement, or in
the Assignment of Lease, or in any document of title provided for in Section
3.2(A)(5) below);

(5)           An endorsement and delivery of certificates
of title required to effectuate the transfer to Buyer of any Vehicles or other
Equipment, and any instruments the endorsement and delivery of which is
required to effectuate transfer to Buyer; and

(6)           The written consent to assignment (in form
and substance reasonably satisfactory to Buyer) of third persons whose approval
of any conveyance contemplated herein is required in order to comply with the
requirements of any agreement or legal requirement binding on the Seller,
Parent or their affiliates.

(B)           Delivery
of Possession.  Seller will deliver
or cause to be delivered to Buyer, or has delivered or caused to be delivered
to Buyer, physical possession of all Records, the originals of all Assigned
Contracts, and other tangible
properties comprising any part of the Purchased Assets, and all keys,
combinations and other mechanisms for controlling access to the Leased Premises
and to any lock box or other repository to which Receivables or other
correspondence of Seller’s is routinely received.

 7
 

(C)           Receivables.  Seller maintains with Wells Fargo Bank (the “Custodial
Bank”) administrative arrangements regarding the collection of
Receivables.  Such arrangement provides
for a lock box arrangement with all items of payment delivered thereto.  At the Closing, Seller will deliver, or cause
to be delivered, to the Custodial Bank a writing which cancels the account/lock
box arrangement and irrevocably instructs the Custodial Bank to remit directly
to Buyer all correspondence, items of payment and other materials received by
it pursuant to any arrangements maintained with the Seller.  To the extent that Seller shall, from and
after the Effective Date, receive any items of payment or be credited with any
items of payment in respect to any Receivables, Seller will promptly account to
Buyer and pay to Buyer such amounts.

(D)          Seller’s
Name.  Seller agrees to and shall
permit Buyer to use the name “New Horizons Computer Learning Centers of Greater
Los Angeles and Orange Counties, California” as a fictitious business name for
so long as the Franchise Agreement remains in effect and, in that regard, shall
(i) from time to time at or after the Closing, execute such documents and take
such actions as are reasonably requested by Buyer to effectuate such result and
(ii) refrain from using or permitting others to use such name or any name
similar thereto in the active conduct of business which is competitive with the
business of Buyer conducted under that name.

(E)                                 Acts
Following Closing

(1)           Lien Releases.  Within thirty (30) days following the
Effective Date (or, where a longer period is required for reasons beyond the
control of the Seller or Parent, then up to sixty (60) days following the
Effective Date), the Seller shall have caused any Liens (excluding the
Permitted Liens) of record existing in respect to any of the Purchased Assets
to be terminated or otherwise released.

(2)           Supplemental Schedules.  Because of the delay customarily occurring in
the posting of certain items to the books and records of Seller, certain of the
Schedules provided herewith by Seller reflect information existing as of March
31, 2007 or a later date, but are incomplete as of the Effective Date.  Therefore, within thirty (30) days following
the Effective Date, Seller shall deliver to Buyer a schedule (the “Supplemental
Schedule”) updating the listings, documents and materials provided for in
each of (a) Schedule 1.1(E) pertaining to Receivables, and (b) Schedule
2.2(A)(1) pertaining to Assumed Balance Sheet Liabilities.

(3)           Deliveries Regarding Receivables.  From time to time at the request of Buyer,
Seller will provide Buyer with such assistance as Buyer shall reasonably
request in order to enable Buyer to enjoy the benefits intended to be conveyed
with regard to the Receivables (but no such request shall require the
expenditure of funds by, or require anything other than telephone consultations
or execution of letters or other written communications to customers of Seller
or issuers of credit cards honored by Seller in respect to the Receivables).

3.3           Acts of Buyer and Owner.  At the Closing (or, as to payments provided
for in Clause (A) below, on the Effective Date), Buyer and Owner, or whichever
thereof is required by the circumstances, will execute and deliver or cause to
be executed and delivered, or has executed and delivered or caused to be
executed and delivered, to Seller and Parent, or 

 8
 

whichever thereof shall be required by the circumstances, such
certificates, instruments and documents as are required by this Agreement or as
are required to give full effect to the transactions provided for herein.  Such shall include, but not be limited to,
the following:

(A)          Cash
Payments.  Buyer shall (i) pay to
Franchisor the Franchisor Cash Payment as provided for in Section 2.1(A)(1),
(ii) pay to Seller the Other Cash Payment as provided for in Section 2.1(A)(2)
and (iii) deliver to Franchisor an executed Promissory Note as provided for in
Section 2.1(C) which, after full performance of subsections (i) and (iii) shall
satisfy Buyer’s obligation to pay an initial franchise fee (the “Initial
Franchise Fee”) in connection with the matters provided for in Section
3.5(B) below.

(B)           Assumption.  Buyer will execute and deliver, or has
executed and delivered, to Seller (i) the Assignment and Assumption Agreement pursuant
to which, among other things, the Buyer assumes the Assumed Liabilities and all obligations accruing on or after the
Effective Date under any of the Assigned Contracts, and (ii) the Assignment of
Lease pursuant to which, among other things, the Buyer assumes the obligations
of Seller under the Facilities Leases to the extent same accrue from and after
the Effective Date.

(C)           Secretary’s
Certificate; Resolutions.  The
secretary or other officer of Buyer has delivered or shall have delivered to
Seller a certificate, dated as of the Effective Date, and to the effect that
all action required to authorize and direct the execution and performance of
this Agreement and any other agreement or instrument of conveyance provided for
herein has been taken; and that all such action so taken remains in effect
without modification or revocation. 
There shall be attached to such certificate a true and complete copy of
the resolutions adopted by the sole shareholder of Buyer authorizing such
actions.

3.4           Prorations at Closing.  Any and all real property Taxes, personal
property taxes, assessments, lease rentals, and other charges applicable to the
Leased Premises, the Purchased Assets or the Assumed Liabilities will be
prorated to the Effective Date, and such Taxes and other charges shall be
allocated between the Parties by adjustment at the Closing, or as soon
thereafter as the Parties may agree.

3.5           Other Agreements.  In addition to the matters provided for
elsewhere in this Agreement, at or prior to the Closing, the Parties shall
additionally execute, or cause their affiliates named therein to execute, the
following separate agreements:

(A)          Employment
Arrangements.  On the Closing Date
but as of the Effective Date, Seller shall terminate the existing employees of
the Business and Buyer shall offer employment
and benefits (including health insurance) to those employees who Buyer wishes
to employ, all at Buyer’s sole cost and expense.

(B)           Franchise
Agreement.  Buyer and New Horizons
Franchising Group, Inc., an affiliate of Seller and wholly-owned direct or
indirect subsidiary of Parent, as franchisor (the “Franchisor”), shall
execute a standard ten (10) year
franchise agreement (the “Franchise Agreement”).

 9
 

(C)           Consents
and Approvals.  All consents,
approvals or authorizations of any governmental agency (including the
California Bureau for Private Postsecondary and Vocational Education (“BPPVE”)),
the landlord named in each Facilities Lease and any other person whose approval
is required to assign to the Buyer the Assigned Contracts and any other
Purchased Assets shall have been obtained on terms satisfactory Buyer and shall
be in full force and effect; and all Permits required to allow Buyer to conduct
the operations of the Business following the Effective Date shall have been
assigned to Buyer by Seller or otherwise obtained by Buyer.

Section 4               ADDITIONAL
COVENANTS AND AGREEMENTS

4.1           Indemnity of Owner Regarding Guarantee of
each Facilities Lease.  Together with
the requirements set forth in this Agreement, the Buyer is acquiring, by way of
assignment of each Facilities Lease, the leasehold interests of Seller and
certain other corporations affiliated by common ownership with the Seller.  Parent is or may be a guarantor or otherwise
obligated for the performance by the tenant or lessee named in each Facilities
Lease, which tenant or lessee will include the Buyer or its affiliates from and
after the Effective Date, and Parent may not be permitted to modify or cancel
its guaranty of the Facilities Lease in connection with the its
assignment.  Accordingly, Parent may
remain liable on the Facilities Lease in the event Buyer is unable to perform
thereunder as required in the Assignment of Lease (or in any sublease executed
in lieu of an Assignment of Lease).  In
consideration of the transfers contemplated in this Agreement and the
assignment (or subletting) of each Facilities Lease, Owner agrees to and does
hereby indemnify and agree to hold Parent harmless of and from any claims made
by the landlords named in each Facilities Lease based on a breach by Buyer (or
any affiliated entity of the Buyer) of any such Facilities Lease; provided,
however, the aggregate liability of the Owner hereunder in respect to all of
the aforesaid Facilities Leases shall be and is limited to the aggregate sum of
[*********************************].

4.2           Non-Solicitation.  Excluding persons employed by Seller in
connection with the Business to whom Buyer shall make offers of employment as
provided for in Section 3.5(A), Buyer and Seller agree not to 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 or, if a shorter period of
time, for six (6) months following the termination of the employee’s employment
with such Party or such Party’s affiliates.

4.3           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 deliver
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 Effective Date,
Buyer shall provide Seller or its designees with reasonable access, during
normal business hours, to all original customer files related to the Purchased
Assets.

4.4           Insurance.  If Seller or Parent or any of their affiliates
possess insurance which provides coverage in respect to any claim of loss made
after the Effective Date, then such insurance shall be deemed primary coverage
for any such loss and Seller, Parent and their 

 10
 

affiliates agree to cooperate with the Buyer in filing and prosecuting
any claim of loss relating to such matters. 
For a period of not more than three (3) years following the Effective
Date, Buyer agrees to maintain general liability insurance in the amount of
$1,000,000 per claim and $1,000,000 in the aggregate; and, upon written request by the Seller, 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.

4.5           Further Assurances.  Each of the Parties agree to use their best
efforts to timely satisfy any conditions to Closing provided for herein and to
assist each other in doing such things and matters as are required to
consummate the transactions provided for herein.  Without limiting the generality of the
foregoing, the Seller and Parent agree to assist the Buyer in procuring timely
transfer of all Assigned Contracts (including licenses, authorized training
center agreements, vendor contracts and Software licenses).

4.6           Announcements; Confidentiality.  The Parties (or certain of the Parties or
their predecessors) have previously executed a Confidentiality Agreement in
connection with the transactions contemplated herein.  As of the Effective Date, said
Confidentiality Agreement shall be of no further force or effect and, instead,
the Parties agree as follows:

(A)          Confidentiality
Agreement.  Except to the extent of
the representations and warranties provided for in this Agreement, no Party
shall have any liability to the other based on any claim that the information
provided by such Party pursuant to the Confidentiality Agreement was untrue,
incomplete or misleading in any way. 
Rather, the Parties shall be entitled to rely only upon the representations
and warranties set forth or provided for in this Agreement.

(B)           Public
Announcements.  The Seller and
Parent, on the one hand, and Buyer and Owner, on the other hand, will consult
with each other before issuing any press release or otherwise making any public
statement with respect to the transactions contemplated herein and shall not
issue any such press release or make any
such public statement without the approval of the others, unless counsel has
advised such Party that such release or other public statement must be issued
immediately and the issuing Party has not been able, despite its good faith
efforts, to secure the prior approval of the other Parties.

4.7           Financial Audit Cooperation.  Buyer shall provide reasonable assistance to
Seller and Parent regarding the 2006 and 2007 financial audits for Parent,
which assistance shall include gathering documentation, providing requested
account analysis and generally responding to inquires from Seller’s outside
auditors; provided, however, Seller shall reimburse Buyer for any out-of-pocket
expense incurred by Buyer in connection with the rendering of such assistance.

4.8           Room Rental.  Seller shall rent four (4) classrooms to
Buyer at the facility leased to Seller under its occupancy lease covering the leased
premises at 100 Corporate Pointe, Suites 270 and 288, Culver City, California
(the “Culver City Lease”) at a rate of $6,874 per week for a period of four (4)
weeks from and after the Effective Date, at which time the room rental
contemplated hereby shall terminate and Buyer must surrender possession of the
leased premises under the Culver City Lease to the landlord named thereunder.

 11
 

4.9           Security
Deposit for Burbank Lease.  On the
Effective Date, Seller shall assign to Buyer its security deposit under the
Burbank Lease and Buyer, concurrently therewith on the Effective Date, shall
pay to Seller the sum of $19,607.70 (which payment is included in the Other
Cash Payment) for the security deposit so assigned.

Section 5               REPRESENTATIONS AND WARRANTIES OF SELLER.  Seller and, in certain cases, Parent
represent and warrant to the Buyer and Owner as follows:

5.1           Organization and Existence.  Seller and Parent are Delaware corporations,
duly organized, validly existing and in good standing under the laws of the State
of Delaware and each has all necessary corporate power to own its assets
(including the Purchased Assets) and to operate its business (including the
Business) as now owned and operated by them.

5.2           Authority.  Seller and Parent each has the full legal
right, power, capacity, and authority required to enter into and perform its
obligations under this Agreement.  All
approvals of the Seller’s and/or Parent’s board of directors or other governing
body required to authorize the execution, delivery and performance of this
Agreement by such Parties has been obtained and, assuming due execution and
delivery by the Buyer and Owners, this Agreement represents a legal, valid and
binding obligation of Seller and Parent that is enforceable against them in
accordance with its terms, subject to (i) as to enforceability, bankruptcy,
insolvency, reorganization or other similar laws affecting the enforcement of
creditors rights generally, (ii) the obtaining of any approvals or consents
required in connection herewith and as provided for herein, and (iii) general
equitable principles and to the discretion of the court before which any
proceedings seeking the remedy of specific performance and injunctive and other
forms of equitable relief may be brought.

5.3           Title.  Seller has good and marketable title to, or a
valid leasehold or licensed interest in, all of the Purchased Assets and,
except as otherwise indicated herein, such Purchased Assets are free and clear
of any Liens other than the Permitted Liens.

5.4           No Breach; Required Approvals.  The
execution and delivery by the Seller and Parent of this Agreement, the
consummation by them of the transactions contemplated hereby, and the performance by them of their obligations
under this Agreement:

(A)          will not violate any provision of the charter or bylaws of such Parties,
nor violate any laws, orders, decrees, judgments or rulings of any judicial or
governmental body applicable to the Seller or Parent; and

(B)           except as shown on Schedule
5.4 attached hereto, will not require the Seller or Parent to obtain
any consents or approvals of, or make any filings with or give any notices to,
any governmental bodies or any other person and will not violate, result in the
breach of, or constitute (or with notice or lapse of time or both, constitute)
a default under any contract, lease, license or other agreement to which the
Seller or Parent is a party or is bound.

5.5           Receivables.  The Receivables consist of those identified
pursuant to the requirements of Section 1.1(E) and Seller has not received any
written notice, nor does it have any Knowledge of the existence of any claim of
offset or counterclaim by any account debtor. 

 12
 

Otherwise, Seller makes no representation or warranty regarding the
quality of the Receivables nor whether or not they are collectable.

5.6           The Business and Related Matters.  To the best of Seller’s Knowledge, the Seller
represents as follows (the “Seller Business Representations”):

(A)          Except as expressly set
forth in Seller’s most recent financial statements, a copy of which is attached
hereto as Schedule 5.6(A) (the “Seller
Financial Statements”), there is no 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, nor does Seller have Knowledge that
any supplier, client or customer
intends to make a reduction in its present level of business conducted with the
Business after the Effective Date, either as a result of this Agreement and the
transactions contemplated hereby or for any other reason;

(B)           As to each of the Assigned Contracts which is material to the operation
of the Business, each is in full force and effect and no party thereto is in
default or has failed to timely and fully discharge its obligations thereunder,
nor has there occurred any event that, with the lapse of time and/or the
giving of notice, would constitute a default thereunder;

(C)           The Business is in material compliance 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 Effective Date have been paid or
accrued;

(D)          Except as
otherwise expressly set forth in this Agreement, all Governmental
Permits 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 Governmental Permits are sufficient to permit the
Business to be operated in its condition as of the Effective Date;

(E)           The Business is in material compliance with all applicable federal,
state and local statutes, laws, rulings and ordinances and Seller does not have
Knowledge of circumstances which are likely to result in a material
violation of any of the foregoing;

(F)           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 or
any of the Purchased Assets or Assumed Liabilities; and

(G)           The
Schedules provided for in
Section 1.1 and Section 2.2 are true and complete with respect to the matters
provided for therein.

 13
 

Section 6               Representations of Buyer And Owner.  Buyer and/or Owner, or whichever thereof is
referred to or as the circumstances require (and, if both, then jointly and
severally), represent and warrant to the Seller and Parent as follows:

6.1           Organization and Existence.  Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
California.  Owner owns 100% of the
issued and outstanding equity interests of Buyer.

6.2           Authority.  Buyer has the full legal right, power,
capacity, and authority required to enter into and perform its obligations
under this Agreement and the execution of this Agreement has been duly
authorized by the Owner.  Assuming due
execution and delivery by the Seller and Parent, this Agreement represents a
legal, valid and binding obligation of Buyer and Owner that is enforceable
against them in accordance with its terms, subject to (i) as to enforceability,
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors rights generally, (ii) the obtaining of any approvals
or consents required in connection herewith and as provided for herein, and
(iii) general equitable principles and to the discretion of the court before
which any proceedings seeking the remedy of specific performance and injunctive
and other forms of equitable relief may be brought.

6.3           The Business and Related Matters.  Buyer and Seller acknowledge that Owner has
served and, as of the Effective Date, continues to serve as General Manager for
the Business and have been responsible for managing those who are involved in
its day to day affairs and operations. 
As a result, Owner represents as follows (the “Owner Business
Representations”):

(A)          Except as expressly set
forth in the Seller Financial Statements, there is no 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, nor does Owner have
Knowledge that any supplier, client or customer intends to make a reduction in
its present level of business conducted with the Business after the Effective
Date, either as a result of this Agreement and the transactions contemplated
hereby or for any other reason;

(B)           As to each of the Assigned Contracts which is material to the operation
of the Business, each is in full force and effect and no party thereto is in default or has
failed to timely and fully discharge its obligations thereunder, nor has there occurred any event that,
with the lapse of time and/or the giving of notice, would constitute a default
thereunder;

(C)           The Business is in 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
Effective Date have been paid or accrued;

(D)          Except as
otherwise expressly set forth in this Agreement, all Governmental
Permits 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 

 14
 

Governmental
Permits are sufficient to permit the Business to be operated in its condition
as of the Effective Date;

(E)           The
Business is in material compliance with all applicable federal, state and local
statutes, laws, rulings and ordinances
and Owners have no Knowledge of circumstances which are likely to result in a
material violation of any of the foregoing;

(F)           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 or any of the Purchased Assets or Assumed Liabilities; and

(G)           The
Schedules provided for in Section 1.1 and Section 2.2 are true and complete
with respect to the matters provided
for therein.

6.4           Approvals.  Buyer has obtained the consent of the BPPVE
to conduct the operations of the Business following the Effective Date related
to the sale of education services to consumers and has received approval of the
BPPVE to transfer Seller’s consumer license to Buyer as of the Effective
Date.   A true and correct copy of such
BPPVE consent and approval is attached as Schedule
6.4.

Section 7               INDEMNIFICATION

7.1           Indemnity by Buyer and/or Owner.

(A)          Buyer
and Owner shall indemnify, hold harmless and defend Seller and Parent, and
their respective affiliates, officers, agents and employees (each, a “Seller
Indemnified Party”), from and against any cause of action, claim, loss or liability arising out of or
resulting in any way from any breach or violation of the representations and
warranties set forth in Section 6, provided that such indemnification is
subject to the conditions set forth in Section 7.3.

(B)           Buyer
and Owner shall indemnify, hold harmless and defend each Seller Indemnified
Party from and against any cause of action, claim, loss or liability arising
out of or resulting in any way from: (v) acts of Owner which relate to sexual
harassment, discrimination or other employment-related claims brought by either
[***************], a current employee of Seller, or [****************], a
former employee of Seller; (w) the negligent acts or omissions of Buyer’s
officers, employees, agents or members occurring in connection with the conduct
of the Business from and after the Effective Date; (x) any breach of any
covenant of Buyer and/or Owner set forth in this Agreement; (y) any
debts, claims, liabilities or lawsuits which relate to and are based upon the use or operation of the
Business or the Purchased Assets from and after the Effective Date; and (z)
the failure of Buyer to fully and adequately pay, perform or observe the
requirements of the Assumed Liabilities, including the Training Obligations.

7.2           Indemnity by Seller.  Seller shall indemnify, hold harmless and
defend Buyer, Owner, and their respective affiliates, officers, agents, members
and employees (each, a “Buyer Indemnified Party”) from and against any
cause of action, claim, loss or liability arising out of or 

 15
 

resulting in any way from: (i) the negligent acts or omissions of
Seller’s officers, employees, agents or partners occurring in connection with
the conduct of the Business prior to the Effective Date; (ii) any breach or
violation of the representations and warranties set forth in Section 5,
provided that such indemnification is subject to the conditions set forth in
Section 7.3 and to the limitations set forth in Section 7.5; (iii) any breach
of any covenant of Seller or Parent set forth in this Agreement; (iv) any
debts, claims, liabilities or lawsuits which relate to the use or operation of
the Business or the Purchased Assets prior to the Effective Date, including the
Retained Liabilities, and (v) any failure to obtain the appropriate release or
termination of any Liens as contemplated in Section 3.2(E)(1) or any adverse
action being taken by any secured party having a claim through or under Seller
or Parent in respect to such Liens at any time.

7.3           Necessity of Reliance.  Notwithstanding anything contained herein to
the contrary, the Parties agree and acknowledge that no duty to indemnify shall
arise by virtue of:

(A)          a
breach of Section 7.1(A) by Buyer and/or Owner if Seller or Parent had
Knowledge of the matter which otherwise gave rise to the duty to indemnify; and/or

(B)           a
breach of Section 7.2(ii) by Seller or Parent if Owner had Knowledge of the
matter which otherwise gave rise to the duty to indemnify.

7.4           Indemnification Procedure.

(A)          Notification of Claim.  Any person
seeking indemnification under Section 7.1 or Section 7.2 (the “Indemnified Party”)
shall promptly notify the other party or parties from whom indemnification is
being sought (the “Indemnifying Party”)
in writing of any claim or demand for which the Indemnified Party is asserting
an indemnification claim.  Such notice
shall be accompanied by a reasonably full description of the basis for such
claim or demand, a reference to the provisions of this Agreement under which
liability is asserted and a statement as to the known amount of the loss or
damage (or, if not known, an estimate thereof if a reasonable basis exist for
estimating the same); provided, however, that no delay on the part of the
Indemnified Party in notifying any Indemnifying Party shall relieve the
Indemnifying Party for any liability or obligation hereunder unless (and then
solely to the extent) the Indemnifying Party is prejudiced by the delay.

(B)           Defense of Legal Actions.  If the claim
which is the subject of any notification given pursuant to Section 7.4(A) is
based on a legal action filed by any third person (a “Third Party Claim”),
the Indemnifying Party shall have the right to take over the defense thereof,
but the Indemnifying Party shall notify the Indemnified Party within ten (10)
Business Days of its receipt of a claim notice pursuant to Section 7.4(A) as to
whether or not it will assume the defense against such Third Party Claim.

(1)           If the Indemnifying Party elects to take over the
defense of such Third Party Claim, then: (aa) it shall keep the Indemnified
Party informed as to the status thereof and promptly provide copies of
pleadings and other filings in the case; (bb) the Indemnifying Party shall have
the sole right to contest, settle or otherwise dispose of such Third Party
Claim on such terms as the Indemnified Party, in its sole discretion, shall
deem appropriate, provided that the consent of the Indemnified Party to any
settlement or disposition shall be required if (x) it 

 16
 

results in any liability to or equitable
relief against the Indemnified Party not fully satisfied by the Indemnifying
Party, (y) the result would in any way restrict the future activity of the
Indemnified Party or any of its affiliates or (z) it would result in the
admission or finding of a violation of law or violation of the rights of any
person by the Indemnified Party or any of its affiliates; and (cc) the
Indemnified Party shall have the right to participate jointly in the defense of
such Third Party Claim, but shall do so at its own cost.

(2)           If the Indemnifying Party does not elect to take over
the defense of such Third Party Claim, then: (aa) the Indemnified Party shall
keep the Indemnifying Party informed as to the status thereof and promptly
provide copies of all pleadings and other filings in the case; (bb) the
Indemnified Party shall have the sole right to contest, settle or otherwise
dispose of such Third Party Claim on such terms as the Indemnified Party, in
its sole discretion, shall deem appropriate, provided that the consent of the
Indemnifying Party to any settlement or disposition shall be required if (x)
it results in any liability to or equitable relief against the Indemnifying
Party not fully satisfied by the Indemnified Party, (y) the result would
in any way restrict the future activity of the Indemnifying Party or any of its
affiliates or (z) it would result in the admission or finding of a
violation of law or violation of the rights of any person by the Indemnifying
Party or any of its affiliates; (cc) the Indemnifying Party shall have the
right to participate jointly in the defense of such Third Party Claim, but
shall do so at its own cost; and (dd) the Indemnified Party may preserve its
rights to indemnification for the recovery of any losses arising from such
Third Party Claim or the costs of defending the same, including, without
limitation, reasonable attorney’s fees.

(3)           The Indemnified Party and the Indemnifying Party
shall cooperate with each other in the defense of any Third Party Claim.

7.5           Limitations.  Seller’s liability for breach of
any of the Seller Business Representations set forth in Section 5.6 shall be
limited to the amount of the Cash Payments.

7.6           Exclusivity
of Remedies.  The Parties hereby acknowledge and
agree that their sole and exclusive remedy with respect to any and all claims
relating to the subject matter of this Agreement (other than a claim for fraud
or for specific performance of the terms of this Agreement) shall be pursuant
to, and limited by, the indemnification provisions set forth in this Section 7.

Section 8               MISCELLANEOUS

8.1           Notices.  All notices with respect to this Agreement
will be in writing and sent by hand delivery, overnight delivery via a national
courier service, certified mail or facsimile to the Parties at their addresses
or facsimile numbers as follows:

If to Seller or Parent:

New Horizons
Computer Learning Center of Santa Ana, Inc.

Attention:  Office of General Counsel

1900 S. State
College Blvd., Suite 650

Anaheim, CA  92806

 17
 

Tel:  (714) 940-8000

Fax:  (714) 938-6007

If to Buyer or Owner:

KML
Enterprises, Inc.

Attention:  Kevin M. Landry, President

9 Windflower

Coto de Caza,
CA 92679

Tel:  (949) 766-9883

Fax:  (949) 766-9884

8.2           Entire Agreement; Assignment. 
This Agreement, together with the Exhibits and Schedules provided for
herein and attached hereto, represents the entire agreement and understanding
between the Parties and is and shall be binding
on each Party and its or his 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 all Parties.

8.3           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.

8.4           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.

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

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

8.7           Governing Law.  This
Agreement will be governed by
and construed in accordance with the laws of the State of California applicable to agreements made and to be performed
entirely within the State of California without giving effect to conflicts of
laws principles.

(End of Page)

 18
 

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

SELLER:

NEW HORIZONS COMPUTER
LEARNING

CENTER OF SANTA ANA, INC.

By:_______________________________

Mark A. Miller

Chief Executive
Officer

PARENT:

NEW HORIZONS WORLDWIDE,
INC.

By:_______________________________

Mark A. Miller

Chief Executive
Officer

BUYER:

KML ENTERPRISES,
INC.

By:_______________________________

Kevin M. Landry

President

OWNER:

__________________________________

Kevin M. Landry,
an individual

 19

EXHIBIT A

PROMISSORY NOTE AND GUARANTY

	
  $37,500.00

  	
   

  	
  June 1,
  2007

  

 

FOR VALUE RECEIVED, the undersigned (“Maker”),
hereby promises to pay to the order of New Horizons Franchising Group, Inc., a
Delaware corporation (“New Horizons”), or order, the sum of $37,500 which
principal shall be due and payable in the amounts and on the dates set forth
below: 

	
  Due Date

  	
   

  	
  Payment Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  August 15, 2007

  	
   

  	
  12,500.00

  	
   

  
	
  September 15, 2007

  	
   

  	
  12,500.00

  	
   

  
	
  October 15, 2007

  	
   

  	
  12,500.00

  	
   

  

 

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 the principal amount of such prepayment.

In
the event that (a) Maker shall default in the payment of principal 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 Guarantor (if applicable) or any part
of Maker’s property, or (c) Maker or Guarantor (if applicable) makes any
general assignment for the benefit of Maker’s or Guarantor’s creditors, or any
proceeding is commenced by or against Maker or Guarantor (if applicable) or any
guarantor, surety, endorser, or other person directly or indirectly liable for
any of the obligations hereunder, or (d) Maker shall be deemed in default of
that certain Franchise Agreement dated June 1, 2007 between Maker and New Horizons
(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 immediately due and payable in full
(the “Balance Due”).

If
a Default occurs, Maker also agrees 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 Guarantor (if applicable) 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 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, Guarantor
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 Guarantor shall be
effective if delivered by hand delivery or deposited in the mails, postage
prepaid, addressed to Maker and/or Guarantor at the address(es) of Maker and/or
Guarantor as set forth in Holder’s records, or, if Maker and/or Guarantor has
notified Holder of a change of address, to the last address of which Holder has
been so notified.

Maker
and Guarantor, for Maker and 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.

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 State of California applicable to contracts made
and to be performed wholly within such state.

 21
 

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

MAKER:

KML
ENTERPRISES, INC.

By:_______________________________

Kevin
M. Landry

President

GUARANTOR:

__________________________________

Kevin
M. Landry, an individual

 22
 

EXHIBIT B

ASSIGNMENT AND ASSUMPTION AGREEMENT

This
Assignment and Assumption Agreement (the “Assignment”) is made for the
consideration provided for in, and pursuant to the requirements of, a certain
Asset Purchase Agreement (“Agreement”) of even date herewith by and between NEW
HORIZONS COMPUTER LEARNING CENTER OF SANTA ANA, INC., a Delaware corporation (“Assignor”),
and KML ENTERPRISES, INC., a California corporation (“Assignee”).

WITNESSETH:

WHEREAS,
pursuant to the Agreement, Assignee desires to purchase and acquire from
Assignor all of the Assignor’s right, title and interest in, or arising under
or pursuant to, those certain agreements described in the Agreement, and herein
referred to, as the “Assigned Contracts”, being those (excluding, for these
purposes, the Facilities Leases) identified on the Attachment hereto, as a
consequence of which the Assignee is willing to assume Assignor’s obligations,
responsibilities and liabilities under the said Assigned Contracts which accrue
from and after the date hereof;

NOW,
THEREFORE:

1.             Assignor hereby assigns, transfers
and conveys to Assignee, all of Assignor’s right, title and interest in, to and
under the Assigned Contracts as defined herein and identified on the Attachment
hereto effective as of the date hereof.

2.             Assignee does hereby accept the
foregoing assignment and does hereby assume, and agree to perform and be bound
by, all of the covenants, conditions, obligations and liabilities of Assignor
under the said Assigned Contracts which accrue from and after the date hereof.

IN WITNESS
WHEREOF, the parties hereto have caused this instrument to be duly executed and
delivered as of the Effective Date provided for in the Agreement.

	
  ASSIGNOR

  	
   

  	
  ASSIGNEE

  
	
   

  	
   

  	
   

  
	
  NEW HORIZONS COMPUTER LEARNING

  	
   

  	
  KML ENTERPRISES, INC.

  
	
  CENTER OF SANTA ANA, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Mark A. Miller

  	
   

  	
   

  	
  Kevin M. Landry

  
	
   

  	
  Chief Executive Officer

  	
   

  	
   

  	
  President

  
									

 

 23

ATTACHMENT

TO

ASSIGNMENT AND ASSUMPTION
AGREEMENT

The following is a listing of
the Assigned Contracts, including the Customer Contracts but excluding the
Facilities Leases, to be and herewith assigned to the Assignee.  To the extent in writing, there is attached
hereto a true and complete copy of each of the Assigned Contracts.

EXHIBIT C-1

ASSIGNMENT OF LEASE

	
  STATE OF CALIFORNIA

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  	
  ASSIGNMENT OF LEASE

  
	
  COUNTY OF LOS ANGELES

  	
  )

  	
   

  

 

FOR VALUABLE
CONSIDERATION, and in consideration of the agreements of the parties set forth
in a certain Asset Purchase Agreement (“Agreement”) of even date herewith by
and between NEW HORIZONS COMPUTER LEARNING CENTER OF SANTA ANA, INC, a Delaware
corporation (“ASSIGNOR”) and KML ENTERPRISES, INC., a California corporation
(herein called “ASSIGNEE”), the undersigned ASSIGNOR and the indirect parent
company of Seller, does hereby set over, transfer, sell and assign unto
ASSIGNEE all of ASSIGNOR’S right, title and interest in and to the following
described lease and agreements (the “Facilities Lease”) entered into by and
between ASSIGNOR, as tenant or lessee, and the landlord or lessor named below:

	
  Name of Landlord:

  	
   

  	
  Arden Realty Finance Partnership, L.P., a California
  limited

  partnership 

  
	
   

  	
   

  	
   

  
	
  Address of
  Premises:

  	
   

  	
  333 North Glenoaks Blvd., Suite 401, Burbank, CA
  91502

  
	
   

  	
   

  	
   

  
	
  Date of Lease:

  	
   

  	
  December 31, 1998

  
	
   

  	
   

  	
   

  
	
  Amendments:

  	
   

  	
  First Amendment to Office Lease dated as of January
  11, 1999; 

  Second Amendment to Office Lease dated as of May 21, 1999; and 

  Third Amendment to Office Lease dated as of February 14, 2005.

  

 

ASSIGNOR
warrants that it has full title to the foregoing leasehold estate, that the
Facilities Lease is in full force and effect, that no condition or state of
facts exists which would constitute a default by ASSIGNOR or, to the Knowledge
(as defined in the Agreement) of ASSIGNOR, by any other party to the Facilities
Lease, and ASSIGNOR has the power and right to assign its rights as herein provided
(subject to the approval of the landlord above named).

By its
execution below, ASSIGNEE agrees to assume, and to pay, perform and abide by,
all of the obligations, indebtedness, terms, provisions and conditions
undertaken to be paid, performed or complied with by ASSIGNOR under or pursuant
to the Facilities Lease at any time from and after June 1, 2007.

(Signatures on Next Page)

IN WITNESS
WHEREOF, the undersigned parties have executed this Assignment of Lease
effective as of the 1st day of June, 2007.

NEW HORIZONS COMPUTER LEARNING CENTER OF
SANTA ANA, INC.

	
  By:

  	
   

  	
   

  
	
   

  	
  Mark A. Miller

  
	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
  KML ENTERPRISES, INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Kevin M. Landry

  
	
   

  	
  President

  
				

 

[LANDLORD’S CONSENT TO THE FOREGOING
ASSIGNMENT IS CONTAINED IN A SEPARATE AGREEMENT ENTITLED “ASSIGNMENT AND
CONSENT TO ASSIGNMENT AGREEMENT”]

EXHIBIT C-2

SUBLEASE
AGREEMENT

This Sublease Agreement (the “Sublease”) is made and entered into as of this 1st day of
June, 2007, by and between New Horizons Worldwide, Inc., a Delaware corporation
(“Sublessor”), and KML Enterprises, Inc.,
a California corporation (“Sublessee”).

RECITALS

A.            Sublessor
leases from Maguire Properties-Stadium Gateway, LP, a Delaware limited
partnership (“Landlord”) the premises located at
1900 S. State College Blvd., First Floor, Anaheim, CA  92806 (the “Entire
Premises”) pursuant to a certain Office Lease dated February 15,
2000, as amended by that certain First Amendment to Office Lease dated June 9,
2000, as further amended by that certain Second Amendment to Office Lease dated
April 25, 2001, as further amended by that certain Third Amendment to Office
Lease dated August 3, 2001, as further amended by that certain Fourth Amendment
to Office Lease dated July 24, 2003, as further amended by that certain Partial
Lease Termination dated September 15, 2006 (collectively the “Lease”) attached hereto as Attachment 1;

B.            Sublessor
currently subleases a portion of the Entire Premises known as Suite 120 to
First NLC Financial Services, LLC and NLC Financial Services, LLC (the “First NLC Sublet Premises”) pursuant to a Sublease Agreement
dated December 24, 2002, as amended (the “First NLC Sublease”);

C.            Sublessor
now wishes to sublease the remaining portion of the Entire Premises to
Sublessee known as Suite 100 (which excludes the First NLC Sublet Premises)
comprised of 19,247 square feet (hereinafter the “Premises”),
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 Franchising Group, Inc. dated June 1, 2007 (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 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 June 1, 2007 (“Sublease Commencement Date”), shall expire on December 31,
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 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.

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 December 31, 2011

  	
   

  	
  $

  	
  40,434.74

  	
   

  
					

 

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 Operating
Expenses (as such term is defined in the Lease) to Sublessor in the amounts and
with such frequency as Sublessor is obligated to pay Operating Expense payments
to Lessor as expressly set forth in Article IV of the Lease.  For purposes of this Sublease, Subtenant’s
share of Operating Expenses shall be 47% of Tenant’s Share as defined in the
Lease, as amended.  For point of
reference only, as of the date of this Sublease, Tenant’s Share (as such term
is defined in the Lease) is 15.02%.

 28
 

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.

 29
 

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

 30
 

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 Lessor 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.

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.

 31
 

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
twelve percent (12%) 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
Franchising Group, 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.

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.

 32
 

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 Worldwide, Inc.

1900 S. State College Blvd., Suite 650

Anaheim, CA 
92806

Attention: 
Legal Department

Notices to Sublessee:                                                                             KML Enterprises, Inc.

9 Windflower

Coto de Caza, CA  92679

Attention: 
Kevin Landry

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

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

 33
 

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 California.  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 California, 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.

16.                               EXCLUSION OF FIRST NLC SUBLEASE

Sublessor and Sublessee acknowledge that
nothing contained in this Sublease shall be construed to provide that either
the First NLC Sublet Premises or the First NLC Sublease are to be included as
part of the Premises covered by this Sublease.

17.                               SUBLEASE CONDITIONAL UPON LANDLORD CONSENT

This Sublease shall not be effective until
Landlord has granted its consent, after which it shall be effective as of the
Sublease Commencement Date.  Sublessor
and Sublessee agree that if Landlord does not grant its consent on or before
the Sublease Commencement Date, then this Sublease shall be of no force and
effect.

 34
 

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 WORLDWIDE, INC.

  	
   

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Mark
  A. Miller

  
	
   

  	
  President
  and CEO

  
	
   

  
	
  SUBLESSEE

  
	
   

  
	
  KML
  ENTERPRISES, INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Kevin
  M. Landry

  
	
   

  	
  President

  

 

[LANDLORD’S CONSENT TO THE FOREGOING SUBLEASE
IS CONTAINED IN A SEPARATE AGREEMENT ENTITLED “CONSENT TO SUBLEASE”]

 35
 

ATTACHMENT 1

LEASE

 36
 

ATTACHMENT 2

PERSONAL GUARANTEE

As an inducement to New Horizons Worldwide,
Inc. (“Sublessor”) to execute the Sublease
(the “Sublease”) with KML Enterprises, 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
Guarantor, the receipt of which is hereby acknowledged, Guarantor jointly and
severally agree as follows:

1.                                       Guarantor 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.                                       Guarantor unconditionally guarantees 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.                                       Guarantor 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 Guarantor 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 Guarantor’s obligations under this Guarantee,
Sublessor, without notice to the Guarantor, may extend, modify, or release any
indebtedness or obligation of Sublessee, or settle, adjust, or compromise any
claims against Sublessee.  Guarantor
waives notice of amendment of the Sublease and notice of demand for payment or
performance by Sublessee.

6.                                       Guarantor’s 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

 37
 

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 Guarantor:

	
  Name

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
  Kevin M. Landry

  	
   

  	
  9 Windflower

  
	
   

  	
   

  	
  Coto
  de Caza, CA 92679

  

 

8.                                       Notwithstanding anything contained in this Guarantee to the contrary,
the maximum liability of Guarantor hereunder shall not exceed $500,000.

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

	
  GUARANTOR:

  
	
   

  
	
   

  	
   

  
	
  Kevin M. Landry

  

 

 38

EXHIBIT D

BILL OF SALE

FOR GOOD
AND VALUABLE CONSIDERATION, the receipt of which is
hereby acknowledged, the undersigned, New Horizons Computer Learning Center of
Santa Ana, Inc., a Delaware corporation having its principal place of business
at 1900 S. State College Blvd., Suite 100, Anaheim, CA  92806 (“Seller”) hereby sells, conveys,
transfers, assigns and delivers to KML Enterprises, Inc., a California
corporation having an address at 9 Windflower, Coto de Caza, CA  92679 (“Buyer”), all of its right, title and
interest in and to the Purchased Assets as such term is defined in that certain
Asset Purchase Agreement (“Agreement”) dated as of June 1, 2007, by and among, inter alia, Buyer and Seller.

TO HAVE
AND TO HOLD the same unto Buyer, its successors and assigns
forever, free and clear of all Liens other than any Permitted Liens (each of
which terms being as defined in the Agreement.

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 1st day of June, 2007.

	
  NEW HORIZONS COMPUTER LEARNING

  
	
  CENTER OF SANTA ANA, INC.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Mark A. Miller

  
	
  Chief Executive
  Officer

  

 

 39
 

Schedule 1.1(A)

Facilities Leases

 40
 

Schedule 1.1(B)

Tangible Personal Property 

 41
 

Schedule 1.1(C)

Intangible Personal Property 

 42
 

Schedule 1.1(D)

Software

 43
 

Schedule 1.1(E)

Receivables 

 44
 

Schedule 2.2(A)(1)

Assumed Liabilities 

 45
 

Schedule 3.2(A)

Permitted Liens

 46
 

Schedule 5.4

Required Approvals

 47
 

Schedule 5.6(A)

Seller Financial Statements

 48
 

Schedule 6.4

BPPVE Consent and Approval 

 49Exhibit 10.1

[EnerNOC Letterhead]

August 10, 2007

Timothy
G. Healy

c/o
EnerNOC, Inc.

75
Federal Street

Suite
300

Boston, MA 02110

This letter is to confirm our understanding with
respect to your continued employment by EnerNOC, Inc. (the “Company”) and supersedes
in its entirety (i) the Letter Agreement entered into by you and the Company
dated as of February 7, 2007 (the “Prior Employment Agreement”) and (ii) the
Stock Repurchase Agreement entered into by you and the Company dated as of June
17, 2003 and amended as of January 10, 2005, May 16, 2006 and February 7, 2007
(the “Stock Repurchase Agreement”).

In consideration of the mutual promises and covenants contained
in this Agreement, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby mutually acknowledged, we have agreed,
effective July 1, 2007, as follows:

1.             Employment.

(a)           Subject
to the terms and conditions of this Agreement, the Company will employ you, and
you will be employed by the Company and/or any Company affiliate (collectively
referred to herein as the “Company Group”) designated by the Company, initially
as Chief Executive Officer  reporting to the Board of Directors.  You will have the responsibilities, duty and
authority commensurate with the position of Chief Executive Officer. 
You will also perform such other and/or different services for the
Company as may be assigned to you from time to time by the Board of Directors.

(b)           Devotion to Duties.  While you are employed hereunder, you will
use your best efforts, skills and abilities to perform faithfully all duties
assigned to you pursuant to this Agreement and to devote your full business
time and energies to the business and affairs of the Company Group.  While you are employed hereunder, you will
not undertake any other employment from any person or entity without the prior
written consent of the Company.

2.             Employment At Will.  Your employment hereunder will be on an “at-will”
basis and may be terminated by the Company or by you for any reason or for no
reason.

3.             Compensation.

(a)           Base Salary.  During the period that you are
employed by the Company, the Company will pay you a base salary at the annual rate of $325,000 (the “Base
Salary”).

The
Base Salary will be payable in substantially equal installments in accordance
with the Company’s payroll practices as in effect from time to time.  The Company will deduct from each such
installment all amounts required to be deducted or withheld under applicable
law or under any employee benefit plan in which you participate.  You
understand and acknowledge that the annualized amount of the Base Salary is set
forth as a matter of convenience and does not constitute nor will be deemed to
constitute an agreement by the Company to employ you for any specific period of
time.

(b)           Annual Performance Bonus.  You will
be eligible to receive an annual performance bonus pursuant to a bonus plan to
be finalized by the Compensation Committee of the Board of Directors of the Company.  Under such bonus plan you are targeted to
receive a performance bonus equal to 80% of your Base Salary (the “Target
Annual Performance Bonus”) but which the actual amount paid will be based on
whether you achieve performance goals that are identified by the Company in the
bonus plan.

(c)           Fringe Benefits.  You will be entitled to
participate in any employee benefit plans which the Company provides or may
establish for the benefit of its executives generally (for example, group life,
disability, medical, dental and other insurance, retirement, pension,
profit-sharing and similar plans) (collectively, the “Fringe Benefits”),
provided that the Fringe Benefits will not include any stock option or similar
plans relating to the grant of equity securities of the Company.  Your eligibility to participate in the Fringe
Benefits and receive benefits thereunder will be subject to the plan documents
governing such Fringe Benefits.  Nothing
contained herein will require the Company to establish or maintain any Fringe
Benefits.

(d)           Reimbursement of Expenses.  Upon
presentation of documentation of such expenses reasonably satisfactory to the
Company, the Company will reimburse you for all ordinary and reasonable
out-of-pocket business expenses, including parking expenses, that are
reasonably incurred by you in furtherance of the Company’s business in
accordance with the Company’s policies with respect thereto as in effect from
time to time; provided, however, all reimbursements will be made by March 15th of the
year after the year in which the expenses are incurred.

4.             Payments Upon Termination.

(a)           In the event of the termination of your employment hereunder for any
reason or for no reason, the Company (a) will pay to you (or to your estate)
(i) the portion of your Base Salary that has accrued prior to such termination
and has not yet been paid, and (ii) an amount equal to the value of your
accrued unused vacation days; and (b) will reimburse you for expenses properly
incurred by you on behalf of the Company prior to such termination and properly
documented in accordance with Section 3(d) above.  Such amounts will be paid promptly after
termination.

(b)           If the
Company terminates your employment without Cause, or you terminate your
employment with Good Reason, the Company will pay you an amount

equal to your Severance
Compensation in twenty (20) equal monthly installments in arrears commencing
one month after the date of termination and shall also pay you, on the date of
your termination, your Accrued Base Compensation as of the termination
date.  The Company’s obligation to make
such payments to you shall cease upon your material breach of any written
agreement between you and the Company or of any written policy of the Company
by which you are bound, if such breach causes or is likely to cause material
harm to the Company.

(c)           If the
Company terminates your employment at any time for Cause, or upon your death or
Disability, the Company will pay you your Accrued Base Compensation.

(d)           Upon any
termination of your employment with the Company to which Section 4(b) applies,
the Company shall maintain the benefits that you were receiving as of the
termination date and shall take such measures as are permissible under its
medical, life, and disability insurance and any other employee benefit plans or
programs to continue coverage or reimbursement for you (and your family, if
applicable) on the same terms (including any required contribution by you) as
immediately prior to such termination. 
If it is not permissible to continue any such coverage under any such
insurance plans, the Company will pay you on the same schedule as set forth in
Section 4(b), as additional severance compensation, such amount, net of state
and federal income taxes payable by you with respect thereto, as will be
sufficient for you to obtain such insurance coverage on an individual basis
assuming that you (and each member of your family who is to be covered) is a “standard
risk” for insurance purposes.  Your
rights under this Section 4(d) shall continue only for so long as you are
entitled to receive payments of Severance Compensation under Section 4(b).

(e)                                  Definitions.  As used in this Section 4, the following
terms shall have the following meanings:

(i)            “Accrued
Base Compensation”:  all amounts of
compensation for services rendered to the Company that have been earned or
accrued through the date of your termination of employment but that have not
been paid as of such date including (i) Base Salary, (ii) reimbursement for
reasonable and necessary business expenses incurred by you on behalf of the Company
during the period ending on such date, and (iii) vacation pay; provided, however, that Accrued
Compensation shall not include any amounts described in clause (i) that have
been deferred pursuant to any salary reduction or deferred compensation elections
made by you.

(ii)           “Cause”: (i) willful failure to perform, or
gross negligence in the performance of, your duties for the Company or any of
its affiliates;  (ii) knowing and material
breach by you of any obligation to the Company or any of its affiliates with
respect to confidential information, non-competition, non-solicitation or the
like; (iii) your breach of fiduciary duty, fraud, embezzlement or other
material

dishonesty with
respect to the Company or any of its affiliates; or (iv) your conviction of, or
plea of nolo contendere to, a felony (other than felonies vehicular in nature)
or any other crime involving moral turpitude; provided, however that with
respect to the grounds set forth in Section 4(e)(ii)(i), Cause shall not
be deemed to exist until you have been given written notice of the facts or
circumstances allegedly constituting such grounds and, where reasonably subject
to cure, thirty (30) days to cure.

(iii)          “Change
of Control”:  (i) the sale of all or
substantially all of the assets or issued and outstanding capital stock of the
Company, or (ii) merger or consolidation involving the Company in which
stockholders of the Company immediately before such merger or consolidation do
not own immediately after such merger or consolidation capital stock or other
equity interests of the surviving corporation or entity representing more than
fifty percent in voting power of capital stock or other equity interests of
such surviving corporation or entity outstanding immediately after such merger
or consolidation.

(iv)          “Disability”: a physical or mental
infirmity that impairs your ability to substantially perform your duties with
the Company for six consecutive months.

(v)           “Good
Reason”: (i) a substantial reduction in your then current base salary,
without your consent; or (ii) material and continuing diminution of your title
or your responsibilities, duties and authority in the operation and management
of the Company as compared to such title or responsibilities, duties and
authority on the date of this Agreement, without your consent.

(vi)          “Severance Compensation”: 100% of your
Base Salary and Target Annual Performance Bonus on the effective date of
termination.

(vii)         “Stock Award”: shall mean any grant of
equity under the Company’s Amended and Restated 2003 Stock Option and Incentive
Plan, 2007 Employee, Director and Consultant Stock Plan or any subsequent stock
plan of the Company.

5.             Change of Control.  In the event of a Change of Control in which
the Company is valued at equal to or greater than $75 million, then,
notwithstanding any contrary or inconsistent provision of any Stock Award granted
to you by the Company, an additional number of shares or options equal to one
hundred percent (100%) of the total shares or options in the Stock Award shall,
on the date of the Change of Control, become fully vested and immediately
exercisable.

6.             Parachute Payment.  If any payment or benefit you would receive
under this Agreement, when combined with any other payment or benefit you
receive pursuant to a Change of Control (“Payment”) would (i) constitute a “parachute
payment” within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the “Code”), and (ii) but for this sentence, be subject to
the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then
such Payment shall be either (x) the full amount of such Payment or (y) such
lesser amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being subject to the
Excise Tax, whichever of the foregoing amounts, taking into account the
applicable federal, state and local employment taxes, income taxes, and

the Excise Tax results in your receipt, on an
after-tax basis, of the greater amount of the Payment notwithstanding that all
or some portion of the Payment may be subject to the Excise Tax.

7.             Mutual Release.  Upon any termination of your employment with
the Company to which Section 4(b) applies, you and the Company shall execute a
mutual release.  Your execution of such mutual
release shall be a condition precedent to the effectiveness of Section 4(b) and
4(c).

8.             409A Compliance.

(a)           Notwithstanding any
other provision with respect to the timing of payments under this Agreement,
if, at the time of your termination, you are deemed to be a “specified employee”
of the Company within the meaning of Section 409A of the Code, then limited
only to the extent necessary to comply with the requirements of Section 409A of
the Code, any payments to which you may become entitled under this Agreement
which are subject to Section 409A of the Code (and not otherwise exempt from
its application) will be withheld until the first (1st) business day of the
seventh (7th) month following your termination of employment, at which time you
shall be paid an aggregate amount equal to the accumulated, but unpaid,
payments otherwise due to you under the terms of this Agreement.

(b)           The Company does not
guarantee the tax treatment or tax consequences associated with any payment or
benefit set forth in this Agreement, including but not limited to consequences
related to Section 409A of the Code.  You
and the Company agree to both negotiate in good faith and jointly execute an
amendment to modify this Agreement to the extent necessary to comply with the
requirements of Code Section 409A; provided that no such amendment shall
increase the total financial obligation of the Company under this
Agreement.  In the event that the Company
determines in good faith that it is required to withhold taxes from any payment
or benefit already provided to you, you agree to pay to the Company on demand
the amount determined by the Company.

9.             Records.  Upon termination of your employment hereunder
for any reason or for no reason and at any other time requested by the Company,
you will deliver to the Company Group any property of the Company Group which
may be in your possession, including products, materials, memoranda, notes,
records, reports or other documents or photocopies of the same.

10.           Insurance.  The Company, in its sole
discretion, may apply for and purchase key person life insurance on your life
in an amount determined by the Company with the Company Group as beneficiary
and one or more other policies of insurance insuring your life.  You will submit to any medical or other
examinations and to execute and deliver any applications or other instruments
in writing that are reasonably necessary to effectuate such insurance.

11.           Representations.  You hereby represent and warrant to the
Company that you understand this Agreement, that you enter into this Agreement
voluntarily and that your employment under this Agreement will not conflict
with any legal duty owned by you to any other party, or with any agreement to
which you are a party or by which you are bound, 

including, without limitation, any non-competition or
non-solicitation provision contained in any such agreement.  You will indemnify and hold harmless the
Company Group and its officers, directors, security holders, partners, members,
employees, agents and representatives against loss, damage, liability or
expense arising from any claim based upon circumstances alleged to be
inconsistent with such representation and warranty.

12.           General.

(a)           Other Agreements.  The
purpose of this Agreement is to set out the above terms and conditions of your
continued employment with the Company. 
It is intended to and supersedes in its entirety your Prior Employment
Agreement and Stock Repurchase Agreement, which are hereby deemed terminated
and of no further force and effect. 
However, this Agreement is not intended to and does not supersede any
other agreements you may have with the Company, including, but not limited to your  Non-Disclosure Agreement. 
No statement, representation, warranty, covenant or agreement of any
kind not expressly set forth in this Agreement, however, will affect, or be
used to interpret, change or restrict, the express terms and provisions of this
Agreement.

(b)           Modifications and Amendments.  The
terms and provisions of this Agreement may be modified or amended only by
written agreement executed by the parties hereto.

(c)           Waivers and Consents.  The
terms and provisions of this Agreement may be waived, or consent for the
departure therefrom granted, only by written document executed by the party
entitled to the benefits of such terms or provisions.  No such waiver or consent will be deemed to
be or will constitute a waiver or consent with respect to any other terms or
provisions of this Agreement, whether or not similar.  Each such waiver or consent will be effective
only in the specific instance and for the purpose for which it was given, and
will not constitute a continuing waiver or consent.

(d)           Assignment.  The Company may assign its
rights and obligations hereunder to any person or entity that succeeds to all
or substantially all of the Company’s business or that aspect of the Company’s
business in which you are principally involved or to any Company
affiliate.  You may not assign your
rights and obligations under this Agreement without the prior written consent
of the Company and any such attempted assignment by you without the prior
written consent of the Company will be void.

(e)           Benefit.  All statements,
representations, warranties, covenants and agreements in this Agreement will be
binding on the parties hereto and will inure to the benefit of the respective
successors and permitted assigns of each party hereto.  Nothing in this Agreement will be construed
to create any rights or obligations except between the Company and you, except
for your obligations to the Company Group as set further herein, and no person
or entity (except for a Company affiliate as set forth herein) will be regarded
as a third-party beneficiary of this Agreement.

(f)            Governing Law.  This Agreement and the rights
and obligations of the parties hereunder will be construed in accordance with
and governed by the law of Massachusetts, without giving effect to the conflict
of law principles thereof.

(g)           Jurisdiction, Venue and Service of Process.  Any
legal action or proceeding with respect to this Agreement will be brought in the courts of
Massachusetts.  By execution and delivery
of this Agreement, each of the parties hereto accepts for itself and in respect
of its property, generally and unconditionally, the exclusive jurisdiction of
the aforesaid courts.

(h)           WAIVER OF JURY TRIAL.  ANY
ACTION, DEMAND, CLAIM OR COUNTERCLAIM ARISING UNDER OR RELATING TO THIS
AGREEMENT WILL BE RESOLVED BY A JUDGE ALONE AND EACH OF YOU AND THE COMPANY
WAIVE ANY RIGHT TO A JURY TRIAL THEREOF.

(i)            Headings and Captions.  The
headings and captions of the various subdivisions of this Agreement are for
convenience of reference only and will in no way modify or affect the meaning
or construction of any of the terms or provisions hereof.

(j)            Counterparts.  This Agreement may be executed
in two or more counterparts, and by different parties hereto on separate
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.

(k)           Opportunity to Review.  You
hereby acknowledge that you have had adequate opportunity to review these terms
and conditions and to reflect upon and consider the terms and conditions of
this Agreement, and that you have had the opportunity to consult with counsel
of your own choosing regarding such terms. 
You further acknowledge that you fully understand the terms of this
Agreement and have voluntarily executed this Agreement.

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

If
the foregoing accurately sets forth our agreement, please so indicate by
signing and returning to us the enclosed copy of this letter.

	
  

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  EnerNOC,
  Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David B.
  Brewster

  	
   

  
	
   

  	
  Name: David B. Brewster

  
	
   

  	
  Title: President and Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Accepted and
  Approved

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Timothy G.
  Healy

  	
   

  	
  August 10, 2007

  	
   

  
	
  Timothy G. Healy

  	
  Date

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