Document:

Exhibit 10.(j)

     

    
      

    

    Exhibit
      10(j)

    
      
        Southwest
          Bank

      

      PROMISSORY
        NOTE

      

      
        	
                Principal

                $1,500,000.00

              	
                Loan
                  Date

                04-02-2007

              	
                Maturity

                04-01-2008

              	
                Loan
                  No

                12030954-22003

              	
                Call
                  / Coll

                 

              	
                Account

                00000122565

              	
                Officer

                32405

              	
                Initials

              
	
                References
                  in
                  the shaded area are for Lender’s use only and do not limit the
                  applicability of this document to any particular loan or
                  item.

                Any
                  item
                  above containing “***” has been omitted due to text length
                  limitations.

              

      

      

      
        	
                Borrower:

              	
                Siboney
                  Learning Group, Inc.

                Siboney
                  Corporation

                325
                  Kirkwood Rd 300

                St
                  Louis, MO 63122

              	
                Lender:

              	
                Southwest
                  Bank of St. Louis

                Des
                  Peres

                13205
                  Manchester Road

                Des
                  Peres, MO 63131

              

      

    

    
      	 	 	 
	
              Principal
                Amount: $1,500,000.00

            	
              Initial
                Rate: 8.250%

            	
              Date
                of Note: April 2, 2007    
                

            

    

    

      PROMISE
        TO
        PAY. Siboney
        Learning
        Group Inc and Siboney Corporation (“Borrower”) jointly and severally promise to
        pay to Southwest Bank of St. Louis (“Lender”), or order, in lawful money of
        the United States of America, the principal amount of One Million Five Hundred
        Thousand & 00/100 Dollars ($1,500,000.00) or so much as may be
        outstanding, together with interest on the unpaid outstanding principal balance
        of each advance. Interest shall be calculated from the date of each advance
        until repayment of each advance.

       

      PAYMENT.
        Borrower
        will pay
        this loan in one payment of all outstanding principal plus all accrued unpaid
        interest on April
1,
2008.
        In addition,
        Borrower will pay regular monthly payments of all accrued unpaid interest
        due as
        of each payment date, beginning May
1,
2007,
        with all
        subsequent interest payments to be due on the same day of each month after
        that.
        Unless otherwise agreed or required by applicable law, payments will be applied
        to Accrued Interest, Credit Life Premiums, Principal, Late Charges, and Escrow.
        The annual interest rate for this Note is computed on a 365/360 basis; that
        is,
        by applying the ratio of the annual interest rate over a year of 360 days,
        multiplied by the outstanding principal balance, multiplied by the actual
        number
        of days the principal balance is outstanding. Borrower will pay Lender at
        Lender’s address shown above or at such other place as Lender may designate in
        writing.

       

      VARIABLE
        INTEREST RATE.
        The interest rate
        on this Note is subject to change from time to time based on changes in an
        index
        which is Lender’s Prime Rate (the “Index”). This is the rate Lender charges, or
        would charge, on 90-day unsecured loans to the most creditworthy corporate
        customers. This rate may or may not be the lowest rate available from Lender
        at
        any given time. Lender will tell Borrower the current Index rate upon Borrower’s
        request. The interest rate change will not occur more often than each Index
        rate
        change and will become effective without notice to the Borrower. If the Index
        becomes unavailable during the term of the Note, the Lender may substitute
        a
        comparable Index. Borrower understands that Lender may make loans based on
        other
        rates as well. The
        Index
        currently is 8.250% per annum. The interest rate to be applied to the
        unpaid principal balance during this Note will be at a rate equal to the
        index, resulting in an initial rate of 8.250% per annum. NOTICE:
        Under no circumstances will the interest rate on this Note be more than the
        maximum rate allowed by applicable law.

       

      PREPAYMENT.
        Borrower may pay
        without penalty all or a portion of the amount owed earlier than it is due.
        Early payments will not, unless agreed to by Lender in writing, relieve Borrower
        of Borrower’s obligation to continue to make payments of accrued unpaid
        interest. Rather, early payments will reduce the principal balance due. Borrower
        agrees not to send Lender payments marked “paid in full”, “without recourse”, or
        similar language. If Borrower sends such a payment, Lender may accept it
        without
        losing any of Lender’s rights under this Note, and Borrower will remain
        obligated to pay any further amount owed to Lender. All written communications
        concerning disputed amounts, including any check or other payment instrument
        that indicates that the payment constitutes “payment in full” of the amount owed
        or that is tendered with other conditions or limitations or as full satisfaction
        of a disputed amount must be mailed or delivered to: Southwest Bank of St.
        Louis, Des Peres, 13205 Manchester Road, Des Peres, MO 63131.

       

      LATE
        CHARGE.
        If a payment is
        more than 10 days late, Borrower will be charged 5.000% of the unpaid portion
        of
        the regularly scheduled payment.

       

      INTEREST
        AFTER DEFAULT.
        Upon default,
        including failure to pay upon final maturity, the interest rate on this
        Note  shall be increased by adding a 3.000 percentage point margin (“Default
        Rate
        Margin”). The
        Default Rate Margin shall also apply to each succeeding interest rate change
        that would have applied had there been no default. However, in no event will
        the
        interest rate exceed the maximum interest rate limitations under applicable
        law.

       

      DEFAULT.
        Each of the
        following shall constitute an event of default (“Event of Default”) under this
        Note.

       

      Payment
        Default.
        Borrower fails to
        make any payment when due under this Note.

       

      Other
        Defaults.
        Borrower fails to
        comply with or to perform any other term, obligation, covenant or condition
        contained in this Note or in any of the related documents or to comply with
        or
        to perform any term, obligation, covenant or condition contained in any other
        agreement between Lender and Borrower.

       

      Default
        in
        Favor of Third Parties.
        Borrower or any
        Grantor defaults under any loan, extension of credit, security agreement,
        purchase or sales agreement, or any other agreement, in favor of any other
        creditor or person that may materially affect any of Borrower’s property or
        Borrower’s ability to repay this Note or perform Borrower’s obligations under
        this Note or any of the related documents.

       

      
         

        
          
            
               

              
              

            

            
              
              

              
                

              

            

            
              
              

              PROMISSORY
                NOTE

              
                	
                        Loan
                          No: 12030954-22003-

                      	
                        (Continued)

                      	
                        Page 2 

                      

              

              

               

            

          

        

      

      False
        Statements.
        Any warranty,
        representation or statement made or furnished to Lender by Borrower or on
        Borrower’s behalf under this Note or the related documents is false or
        misleading in any material respect, either now or at the time made or furnished
        or becomes false or misleading at any time thereafter.

       

      Insolvency.
        The dissolution or
        termination of Borrower’s existence as a going business, the insolvency of
        Borrower, the appointment of a receiver for any part of Borrower’s property, any
        assignment for the benefit of creditors, any type of creditor workout, or
        the
        commencement of any proceeding under any bankruptcy or insolvency laws by
        or
        against Borrower.

       

    

    
      Creditor
        or
        Forfeiture Proceedings.
        Commencement of
        foreclosure or forfeiture proceedings, whether by judicial proceeding,
        self-help, repossession or any other method, by any creditor of Borrower
        or by
        any governmental agency against any collateral securing the loan. This includes
        a garnishment of any of Borrower’s accounts, including deposit accounts, with
        Lender. However, this Event of Default shall not apply if there is a good
        faith
        dispute by Borrower as to the validity or reasonableness of the claim which
        is
        the basis of the creditor or forfeiture proceeding and if Borrower gives
        Lender
        written notice of the creditor or forfeiture proceeding and deposits with
        Lender
        monies or a surety bond for the creditor or forfeiture proceeding, in an
        amount
        determined by Lender, in its sole discretion, as being an adequate reserve
        or
        bond for the dispute.

       

      Events
        Affecting Guarantor.
        Any of the
        preceding events occurs with respect to any guarantor, endorser, surety,
        or
        accommodation party of any of the indebtedness or any guarantor, endorser,
        surety, or accommodation party dies or becomes incompetent, or revokes or
        disputes the validity of, or liability under, any guaranty of the indebtedness
        evidenced by this Note. In the event of a death, Lender, at its option, may,
        but
        shall not be required to, permit the guarantor’s estate to assume
        unconditionally the obligations arising under the guaranty in a manner
        satisfactory to Lender, and, in doing so, cure any Event of
        Default.

       

      Change
        In
        Ownership.
        Any change in
        ownership of twenty-five percent (25%) or more of the common stock of
        Borrower.

       

      Adverse
        Change.
        A material adverse
        change occurs in Borrower’s financial condition, or Lender believes the prospect
        of payment or performance of this Note is impaired.

       

      Insecurity.
        Lender in good
        faith believes itself insecure.

       

      LENDER’S
        RIGHTS.
        Upon default,
        Lender may declare the entire unpaid principal balance under this Note and
        all accrued unpaid interest immediately due, and then Borrower will pay that
        amount.

       

      ATTORNEYS’
        FEES; EXPENSES.
        Lender may hire or
        pay someone else to help collect this Note if Borrower does not pay. Borrower
        will pay Lender that amount. This includes, subject to any limits under
        applicable law, Lender’s attorneys’ fees and Lender’s legal expenses whether or
        not there is a lawsuit, including attorneys’ fees and expenses for bankruptcy
        proceedings (including efforts to modify or vacate any automatic stay or
        injunction), and appeals. If not prohibited by applicable law, Borrower also
        will pay any court costs, in addition to all other sums provided by
        law.

       

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

       

      CHOICE
        OF
        VENUE.
        If there is a
        lawsuit, Borrower agrees upon Lender’s request to submit to the jurisdiction of
        the courts of St Louis County, State of Missouri.

       

      DISHONORED
        ITEM FEE.
        Borrower will pay
        a fee to Lender of $15.00 if Borrower makes a payment on Borrower’s loan and the
        check or preauthorized charge with which Borrower pays is later
        dishonored.

       

      RIGHT
        OF
        SETOFF.
        To the extent
        permitted by applicable law, Lender reserves a right of setoff in all Borrower’s
        accounts with Lender (whether checking, savings, or some other account).
        This
        includes all accounts Borrower holds jointly with someone else and all accounts
        Borrower may open in the future. However, this does not include any IRA or
        Keogh
        accounts, or any trust accounts for which setoff would be prohibited by law.
        Borrower authorizes Lender, to the extent permitted by applicable law, to
        charge
        or setoff all sums owing on the debt against any and all such accounts, and,
        at
        Lender’s option, to administratively freeze all such accounts to allow Lender to
        protect Lender’s charge and setoff rights provided in this
        paragraph.

       

      LINE
        OF
        CREDIT.
        This Note
        evidences a revolving line of credit. Advances under this Note, as well as
        directions for payment from Borrower’s accounts, may be requested orally or in
        writing by Borrower or by an authorized person. Lender may, but need not,
        require that all oral requests be confirmed in writing. Borrower agrees to
        be
        liable for all sums either: (A) advanced in accordance with the instructions
        of
        an authorized person or (B) credited to any of Borrower’s accounts with Lender.
        The unpaid principal balance owing on this Note at any time may be evidenced
        by
        endorsements on this Note or by Lender’s internal records, including daily
        computer print-outs. Lender will have no obligation to advance funds under
        this
        Note if: (A) Borrower or any guarantor is in default under the terms of this
        Note or any agreement that Borrower or any guarantor has with Lender, including
        any agreement made in connection with the signing of this Note;
        (B) Borrower or any guarantor ceases doing business or is insolvent; (C)
        any guarantor seeks, claims or otherwise attempts to limit, modify or revoke
        such guarantor’s guarantee of this Note or any other loan with Lender; (D)
        Borrower has applied funds provided pursuant to this Note for purposes other
        than those authorized by Lender; or (E) Lender in good faith believes itself
        insecure.

       

      SUCCESSOR
        INTERESTS.
        The terms of this
        Note shall be binding upon Borrower, and upon Borrower’s heirs, personal
        representatives, successors and assigns, and shall inure to the benefit of
        Lender and its successors and assigns.

       

       

      
         

        
           

          
            
              
                 

                
                

              

              
                
                

                
                  

                

              

              
                
                

                PROMISSORY
                  NOTE

                
                  	
                          Loan
                            No: 12030954-22003-

                        	
                          (Continued)

                        	
                          Page 3 

                        

                

                

                 

              

            

          

        

      

       

      
        GENERAL
          PROVISIONS.
          If any part of
          this Note cannot be enforced, this fact will not affect the rest of the
          Note.
          Lender may delay or forgo enforcing any of its rights or remedies under
          this
          Note without losing them. Each Borrower understands and agrees that, with
          or
          without notice to Borrower, Lender may with respect to any other Borrower
          (a)
          make one or more additional secured or unsecured loans or otherwise extend
          additional credit; (b) alter, compromise, renew, extend, accelerate, or
          otherwise change one or more times the time for payment or other terms
          of any
          indebtedness, including increases and decreases of the rate of interest
          on the
          indebtedness; (c) exchange, enforce, waive, subordinate, fail or decide
          not to
          perfect, and release any security, with or without the substitution of
          new
          collateral; (d) apply such security and direct the order or manner of
          sale thereof, including without limitation, any non-judicial sale permitted
          by
          the terms of the controlling security agreements, as Lender in its discretion
          may determine; (e) release, substitute, agree not to sue, or deal with
          any one
          or more of Borrower’s sureties, endorsers, or other guarantors on any terms or
          in any manner Lender may choose; and (f) determine how, when and what
          application of payments and credits shall be made on any other indebtedness
          owing by such other Borrower. Borrower and any other person who signs,
          guarantees or endorses this Note, to the extent allowed by law, waive
          presentment, demand for payment, and notice of dishonor. Upon any change
          in the terms
          of this Note, and unless otherwise expressly stated in writing, no party
          who
          signs this Note, whether as maker, guarantor, accommodation maker or endorser,
          shall be released from liability. All such parties agree that Lender may
          renew
          or extend (repeatedly and for any length of time) this loan or release
          any party
          or guarantor or collateral; or impair, fail to realize upon or perfect
          Lender’s
          security interest in the collateral; and take any other action deemed necessary
          by Lender without the consent of or notice to anyone. All such parties
          also
          agree that Lender may modify this loan without the consent of or notice
          to
          anyone other than the party with whom the modification is made. The obligations
          under this Note are joint and several.

      

    

    
       

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

      

      JURY
        WAIVER.
        Lender and
        Borrower hereby waive the right to any jury trial in any action, proceeding,
        or
        counterclaim brought by either Lender or Borrower against the
        other.

      

      PRIOR
        TO
        SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
        THIS
        NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. EACH BORROWER AGREES
        TO
        THE TERMS OF THE NOTE.

      

      BORROWER
        ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY
        NOTE.

      

      BORROWER:

    

    

    SIBONEY
      LEARNING
      GROUP INC

    

    
      	
              By: /s/ William
                D.
                Edwards                                              
                

              William
                D.
                Edwards, President of

              Siboney
                Learning Group, Inc.

            	
              By:/s/ Rebecca
                Braddock                                                      
                

              Rebecca
                Braddock, Secretary of 

              Siboney
                Learning Group, Inc.

            
	
               

            	
               

            
	
               

            	
               

            
	
               

            	
               

            
	
               

            	
               

            
	
              SIBONEY
                CORPORATION

            	
               

            
	
               

            	
               

            
	
              By: /s/ William
                D.
                Edwards                                                 
                

              William
                D.
                Edwards, Executive Vice President of

              Siboney
                Corporation

            	
              By:/s/ Rebecca
                Braddock                                                      
                

              Rebecca
                Braddock, Secretary of

              Siboney
                CorporationExhibit 10.(k)

    
      

    

     

    Exhibit
      10(k)

    

      

      STRATEGIC
        ALLIANCE AND JOINT DEVELOPMENT
        AGREEMENT

      

      This
        Strategic
        Alliance and Joint Development Agreement (the “Agreement”) is
        entered into on this 2nd day of February, 2007, (the “Effective
        Date”) by and between:

      

      
        	
                1.

              	
                Edumatics
                  Corporation, Inc.
                  incorporated under the laws of the State of California, USA, having
                  its
                  office at 1655 Mesa Verde Avenue, Suite 120, Ventura CA 93003 through
                  its
                  authorized representative, Mr. Sandeep Kumar (hereafter referred
                  to as
                  “Edumatics” which expression shall where the context
                  permits include its successors and permitted
                  assigns),

              

      

      

      AND

      

      
        	
                2.

              	
                Siboney
                  Learning Group, Inc.,
                  incorporated under the laws of the State of Texas, USA, having
                  its office
                  at 325 N. Kirkwood Road, Kirkwood Missouri 63122, through its authorized
                  representative, Mr. William D. Edwards (hereafter referred to as
                  “Siboney” which expression shall where the context
                  permits include its successors and permitted
                  assigns).

              

      

      

      Edumatics
        and Siboney are hereafter sometimes collectively
        referred to as the “Parties” and singly as a “Party”.

      

      RECITALS

      

      Whereas,
        Edumatics
        has access to digital educational content libraries, applications and products
        and other learning solutions and Siboney publishes certain educational
        curriculum software products primarily for K - 12 schools and adult learning
        centers. 

      

      Whereas,
        Edumatics
        and Siboney wish to cooperate in the joint development of a web based test
        preparation program which will be correlated to each state’s specific curriculum
        standards.

      

      Whereas,
        it is
        contemplated that upon completion of development of the new online test
        preparation program, it will be marketed by Siboney using its existing
        distribution channels, subject to the terms and conditions of this
        Agreement.

       

      Whereas,
        the Parties acknowledge that the creation and development
        of the online test preparation program would be enhanced by a combination
        of
        their respective expertise and resources, including their distribution channels,
        technologies, content libraries, capital, personnel, etc.

      

      Whereas,
        Edumatics
        and Siboney wish to undertake such commitments, obligations and
        responsibilities, as are set forth herein, on the terms and conditions contained
        in this Agreement. 

      

      NOW
        THEREFORE, in consideration of the mutual
        covenants contained herein, the sufficiency and adequacy of which are hereby
        acknowledged, the Parties agree as follows: 

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      1. DEFINITIONS
        AND CONSTRUCTION.

      

      1.1 All
        references in this Agreement to "Section”, “Sections”, “Exhibits” refer to the
        section, sections and exhibits of this Agreement. As used in this Agreement,
        neutral pronouns and any variations thereof shall be deemed to include the
        feminine and masculine and all terms used in the singular shall be deemed
        to
        include the plural, and vice versa, as the context may require. The words
        "hereof," "herein" and "hereunder" and other words of similar import refer
        to
        this Agreement as a whole, as the same may from time to time be amended or
        supplemented, and not to any subdivision contained in this Agreement. The
        word
        "including" when used herein is not intended to be exclusive and means
        "including, without limitation." 

      

      2. INTENT
        AND PURPOSE; NEW PROGRAM;
        POTENTIAL BENEFITS.

      

      2.1 Intent
        and Purpose. This Agreement contemplates
        certain joint development activities between Edumatics and Siboney that are
        intended to facilitate the creation of a new online test preparation program
        (such web based version hereafter referred to as the "New
        Program"), (a) using the intellectual property, software development
        manpower, sales and marketing expertise of Siboney, (b) using software
        development manpower and capital provided by Edumatics, and (c) as well as
        the
        marketing and distribution by Siboney of the New Program thus developed and
        created (the aforesaid joint development and marketing hereafter referred
        to as
        the “Project”).

      

      2.2 Potential
        Benefits. 

      

      2.2.1 Potential
        Benefits to Edumatics

      

      
        	 	
                q

              	
                Leverage
                  Siboney’s market knowledge to access new and
                  emerging opportunities by participating in the
                  Project;

              

      

      

      
        	 	
                q

              	
                Leverage
                  Siboney’s assessment item bank that is correlated
                  to all 49 states that have curriculum
                  standards;

              

      

      

      
        	 	
                q

              	
                Leverage
                  other Siboney intellectual property such as
                  preprogrammed business objects, graphics, sound files and motivational
                  games;

              

      

      

      
        	 	
                q

              	
                Leverage
                  the proven educational curriculum software
                  development expertise of the Siboney software
                  engineers;

              

      

      

      
        	 	
                q

              	
                Leverage
                  the existing Siboney business infrastructure to
                  provide accounting, marketing, sales and technical support for
                  the New
                  Program;

              

      

      

      
        	 	
                q

              	
                Increased
                  visibility in the US market through development of
                  the New Program; and 

              

      

       

      
        
          	 	
                  q

                	
                  Increase
                    revenue growth by exploiting opportunities
                    identified through Siboney’s existing marketing
                    channels.

                

        

         

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      2.2.2
Potential
        Benefits to Siboney

       

      
        
          	 	
                  q

                	
                  Access
                    to capital and highly skilled personnel at lower
                    costs, to realize competitive edge/advantage for the New
                    Program.

                

        

      

      

      2.3 New
        Program. It is contemplated that the New
        Program shall have the functionalities/specifications attached hereto as
        Exhibit
        A Section: Online Product Offerings-Proposed Online Products-Phase I. For
        avoidance of doubt, the New Program will not include any
        functionality/specifications as described in Exhibit A Section: Online Product
        Offerings-Proposed Online Products Phase II or Phase III. 

      

      2.4 Budget.
        Based upon the Parties’ good faith
        estimates, the entire Project will cost a total of $1,200,000, as per the
        Budget, a break down of which is attached hereto as Exhibit B. The
        mutually agreed upon working capital budget is presented in Exhibit B - Section:
        Operating Costs. No Party under any circumstances will be required to incur
        additional working capital beyond an additional $100,000 to that stated in
        Exhibit B - Section: Operating Costs.

      

      3. PROJECT;
        RESOURCE COMMITMENT AND
        DELIVERABLES.

      

      It
        is estimated that the Project would require resource commitment
        and deliverables by the Parties as follows:

      

      3.1 By
        Edumatics

      

      3.1.1 Development
        Team Members.
        Edumatics will provide development team members to the development team
        (hereafter the “Development Team”), to develop the New Program.
        The Development Team will be comprised of members from both Edumatics and
        Siboney. Edumatics Development Team members will assist as needed in the
        creation of the New Program. Edumatics shall also designate a manager
        ("Development Team Manager") who shall be the principal point
        of contact for the Edumatics Development Team members for all matters relating
        to this Agreement. 

      

      Edumatics
        may designate a new Development Team Manager and change
        other personnel constituting the Development Team responsible for particular
        tasks related to this Agreement by written notice to Siboney.

       

      3.2 By
        Siboney 

      

      3.2.1 Siboney
        will contribute its proprietary item bank which
        is correlated to 49 states’ curriculum standards towards the development and
        creation of the New Program. 

      

      3.2.2 Development
        Team Members.
        Siboney will contribute the development resources necessary to achieve the
        New
        Program Phase I functionality as defined in Exhibit A. At such time as the
        functionality as defined in Exhibit A is achieved by reference to the Acceptance
        Criteria (as hereafter defined in Section 6.3.3), Siboney will be deemed
        to have
        contributed its resources committed to the creation of the New Program. Siboney
        shall also designate a manager who shall be the principal point of contact
        for
        the Siboney Development Team members for all matters relating to this Agreement.
        

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

      Siboney
        may designate a new Development Team Manager and change
        other personnel constituting the Editorial Team responsible for particular
        tasks
        related to this Agreement by written notice to Edumatics.

      

      3.2.3 Sales
        and Marketing Team. Siboney will assign a sales and marketing team
        (hereafter the “Sales and Marketing Team”) that will work
        together on a non-exclusive basis to actively market the New Program and
        other
        related services and applications. Siboney shall also designate a manager
        ("Sales and Marketing Team Manager") who shall be the principal
        point of contact for the Sales and Marketing Team for all matters relating
        to
        this Agreement. The Sales and Marketing Team shall undertake the sales and
        marketing efforts as defined in Exhibit A, Sections: Sales Strategy and
        Marketing Strategy. 

      

      Siboney
        may designate a new Sales and Marketing Team Manager and
        change other personnel constituting the Sales and Marketing Team responsible
        for
        particular tasks related to this Agreement by written notice to Edumatics.

      

      3.3 Project
        Committee. Edumatics and Siboney will appoint a Project Committee consisting
        of 4 representatives, having 2 representatives from Edumatics and 2
        representatives from Siboney. The Project Committee shall oversee, coordinate
        and manage the Project Plan (as hereafter defined in Section 4), to ensure
        that
        a coordinated plan exists to take the Project through from conception through
        to
        commercialization in terms of this Agreement. The Project Committee will
        meet at
        mutually acceptable times to review the Project Plan as aforesaid.

       

      4.
PROJECT
        PLAN

      

      It
        is understood and agreed that the New Program will be created
        and developed in terms of the Project plan attached at Exhibit C
        (hereafter the "Project Plan"). The Project Plan sets forth the
        development phases, deliverables; milestone schedules, testing and acceptance,
        launch and hosting, and marketing of the New Program under the Project. 

      

      5. PROJECT
        FUNDING.

      

      Funding
        for the
        design, development, marketing, sales and technical support of the New Program
        will be provided in the following three ways subject to Section 2.4:

      

      5.1 Software
        Development. Based upon the Project Plan
        as presented in Exhibit C and the Budget as presented in Exhibit B, the cost
        of
        the Development Team required to build the New Program is $33,000 for Edumatics
        resources and $390,000 for Siboney resources. Therefore, in order to equally
        share the agreed upon cost of New Program development, Edumatics agrees to
        pay
        $178,500 to Siboney no later than February 14, 2007. Actual Development Team
        expenses will be reconciled within 15 days of launching and hosting the New
        Program. The reconciliation process will be conducted following the
        reconciliation process outlined in Section 9.3. Neither Party shall be obligated
        to incur Development Team costs in excess of those stated in this Section
        5.1.

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      

      5.2 Intellectual
        Property. Siboney will be providing
        approximately 16,000 items correlated to state standards to be used in the
        New
        Program. Edumatics and Siboney agree that the approximate value of these
        items
        is $500,000. Therefore, in order to equally share the cost of these items,
        Edumatics agrees to pay $250,000 to Siboney. Siboney agrees to accept payment
        of
        this amount solely from the revenue generated from the New Program. Siboney
        will
        receive an additional 10% of the profit from the New Program (thus 60% to
        Siboney and 40% to Edumatics) until the $250,000 is paid off. Upon final
        payment
        of the $250,000 the split will return to 50% - 50%.

      

      5.3
        Working Capital. Both Parties agree that capital is required
        to fund the non-Development Team activities, such as marketing, sales, accounts
        receivable, accounts payable and technical support. The estimated amount
        of
        working capital required is presented in Exhibit B. Both Parties also agree
        to
        equally share these working capital costs, subject to Section 2.4. One month
        prior to the beginning of a new calendar quarter, the Project Committee will
        review, negotiate in good faith, and mutually agree on a working capital
        budget
        for the upcoming quarter. This budget will be used as a not to exceed amount
        for
        total expenditures for the upcoming quarter. Edumatics agrees to pay to Siboney
        no later than 15 days prior to the beginning of the upcoming quarter, an
        amount
        equal to 50% of the agreed-upon working capital budget for the upcoming quarter.
        Actual working capital costs will be tracked and reported and a quarterly
        reconciliation process will be conducted following the reconciliation process
        outlined in Section 9.3.

      

      Edumatics
        agrees to pay $62,132 to Siboney as the first quarter
        2007 working capital payment no later than February 14, 2007.

       

      6.
RESPONSIBILITIES,
        COVENANTS AND
        AGREEMENTS OF EACH PARTY RELATING TO THE PROJECT.

      

      6.1 Obligations
        of Edumatics

      

      6.1.1 Development.
        Edumatics shall assist in
        developing the New Program in accordance with the functionalities and
        specifications specified in Exhibit A. In this regard, Edumatics, shall,
        in addition to its expressed commitments in terms of Section 3.1 above, fund
        all
        costs and expenses incurred by it in the development of the New Program,
        however, all such costs and expenses are, subject to Section 2.4, not to
        exceed
        $33,000 as stated in the Budget in Exhibit B.

      

      

      6.2 Obligations
        of Siboney

      

      6.2.1 Development.
        Siboney shall assist in developing
        the New Program in accordance with the functionalities and specifications
        specified in Exhibit A. In this regard, Siboney, shall, in addition to
        its expressed commitments in terms of Section 3.2 above, fund all costs and
        expenses incurred by it in the development of the New Program, however,
        all

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      such
        costs and expenses are, subject to Section 2.4, not to exceed
        $390,000 as stated in the Budget in Exhibit B. 

      

      6.2.2 Sales
        and Marketing. Siboney shall be
        responsible for the sales and marketing of the New Program through its sales
        and
        distribution channels in accordance with the Sales and Marketing Summary
        attached hereto as Exhibit A Sections: Sales Strategy and Marketing
        Strategy and referred to in Section 6.3.5 and any revised Sales and
        Marketing Summary. Siboney shall use its best efforts and professional staff
        to
        achieve the highest possible sales of the New Program. Siboney’s
        responsibilities include, but are not limited to the following:

      

      (a) Revising
        and developing the Sales and Marketing Summary
        attached hereto as Exhibit A, within thirty (30) days of the Effective
        Date of this Agreement and submitting a revised comprehensive Sales and
        Marketing Summary to Edumatics for approval. Edumatics has the right to approve
        the revised Sales and Marketing Summary, which may subsequently be modified
        as
        necessary by the Project Committee with the unanimous consent of the Parties
        in
        writing. The Project Committee shall review the Sales and Marketing Summary,
        no
        less frequently than quarterly.

      

      (b) Executing
        the Sales and Marketing Summary, including, but
        not limited to, attending mutually agreed to road/trade shows to promote
        the New
        Program, and otherwise promoting the New Program to end users.

      

      (c) Conducting
        market research, mutually agreed upon by the
        Parties, to identify prospective/new customers, new opportunities, market
        demand
        for the New Program as well as other competitive products.

      

      (d) Establishing,
        training, and managing a sales force and
        work with its channel partners and through its own sales resources to generate
        sales and achieve revenue targets, in accordance with the Sales and Marketing
        Summary, and the terms of this Agreement.

      

      6.3 Mutual
        Obligations of the Parties

      

      6.3.1 Coordination.
        Edumatics and Siboney shall
        jointly coordinate the development efforts of the New Program according to
        the
        functionalities and specifications specified in Exhibit A. In this
        regard, Edumatics and Siboney will cooperate in terms of the Project Plan
        to
        ensure that the Project is completed on the due date stated in the Project
        Plan.
        The Project Plan will be reviewed by the Project Committee from time to time
        with the intent that the Parties move expeditiously and effectively toward
        commercialization of the New Program. Each Party shall keep the other Party
        closely informed through regular reports to the Project Committee of the
        progress of the Project, in a format to be mutually agreed upon by the Parties.
        The Parties shall also create a document retention policy related to each
        Party's development efforts.

      

      6.3.2 Change
        Requests. Within sixty (60) days of the
        Effective Date, either Edumatics or Siboney may request changes (consisting
        of
        additions, modifications, reallocation of development funds, deletions or
        other
        revisions) with respect to Exhibit A and/or Exhibit C, provided such changes
        are
        made in good faith and enhance the overall results of the collaborative efforts
        of the Parties/New Program. Each change request must be

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      reflected
        in a written document signed by both Parties that
        includes a detailed description of the specific change, along with any modified
        specifications and desired completion date(s) ("Change Request"). Each Change
        Request duly authorized in writing by the Parties shall constitute a formal
        amendment to this Agreement, and shall be deemed incorporated into and shall
        become part of this Agreement. A Change Request shall have no effect on the
        rights and obligations of either Party with respect to deliverables or
        developmental activities provided before the effective date of the Change
        Request. The Parties shall negotiate in good faith the terms, conditions
        (including any changes to milestone schedules), and allocation of costs related
        to the implementation of any Change Request.

      

      6.3.3 Acceptance
        Criteria. The Parties shall use
        commercially reasonable efforts and work in good faith to mutually agree
        in
        writing upon an acceptance criteria for the New Program (“Acceptance
        Criteria”) within sixty (60) days of Effective Date. The agreed
        Acceptance Criteria shall, upon its execution, be deemed incorporated into,
        and
        form a part of this Agreement, with effect from the date of its execution.
        It is
        contemplated that acceptance shall be performed by Project Committee. The
        Project Committee shall conduct such testing and acceptance processes with
        respect to the New Program in order to determine that the New Program meets
        the
        functionalities and specifications set forth herein and in Exhibit A
        attached hereto.

      

      6.3.4 Launch
        and Hosting. Edumatics and Siboney shall
        agree within ten (10) days of completion of acceptance in terms of the
        Acceptance Criteria upon a plan for launching and hosting the New Program.
        

      

      6.3.5  Delivery
        of Source Code. No later than
        July 1, 2007, Siboney shall deliver to Edumatics, a complete copy of the
        latest
        version of the New Program, including, without limitation, all source code
        and
        other source material, in the media and format as Edumatics shall
        designate.

      

      6.3.6 Sales
        and Marketing Summary. Attached in Exhibit
        A is a Sales and Marketing Summary which sets forth a comprehensive description
        of the methods by which the Sales and Marketing Team will cooperate, including
        product positioning, methods of sales engagement, action plans and time lines,
        for the New Program. Within sixty (60) days from the Effective Date, the
        Parties
        shall mutually agree on a more detailed Sales and Marketing Summary (draft
        to be
        submitted by the Sales and Marketing Team in terms of Section 6.2.2 above)
        addressing each of the points identified in the Sales and Marketing Summary
        including the following. 

      

      
        	 	
                q

              	
                A
                  mutually agreeable market message and marketing strategy
                  to describe the joint development efforts of both Parties and the
                  benefits
                  offered to the market/customers through the cooperation of the
                  Parties by
                  the creation and development of the New
                  Program.

              

      

      

      
        	 	
                q

              	
                Appropriate
                  press, analyst, distributors, customer and field
                  sales briefings to better describe the
                  above.

              

      

      

      
        	 	
                q

              	
                Definition
                  of a marketing program to create awareness and
                  provide lead generation for the development
                  activities.

              

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      Any
        revised Sales and Marketing Summary as aforesaid, shall, upon
        its execution, by Siboney and Edumatics, be deemed incorporated into, and
        form a
        part of this Agreement, with effect from the date of its execution. 

      

      6.3.7 Branding

      

      6.3.7.1 Ownership
        of Pre-Existing Brand Names and
        Trademarks. Each Party shall retain all rights, title and other interest to
        its pre-existing brand names, service marks, trademarks and other proprietary
        markings except as expressly provided otherwise in this Agreement.

      

      6.3.7.2 Branding
        of the New Program. The New Program
        shall be branded with a newly created product name (the “New Program
        Trademark”), which shall be jointly adopted by the Parties and provided to the
        Sales and Marketing Team. Siboney shall be the owner of the New Program
        Trademark, and agrees to grant and does hereby grant a sole, exclusive,
        worldwide, royalty free, irrevocable license to Edumatics to use the New
        Program
        Trademark in connection with the marketing and sale of the New Program during
        the term of this Agreement, subject to the provisions of Section 16. The
        New
        Program Trademark shall appear prominently in any web site or portals marketing,
        advertising and/or using the New Program as licensed by any of the Parties,
        provided that the owners/operators of such web sites or portals permit the
        same.

      

      6.3.8 Expenses

      

      6.3.8.1 Records.
        Each Party shall maintain detailed
        records which accurately identify all costs and expenses incurred and paid
        in
        connection with the New Program. Each Party shall submit this information
        to the
        Project Committee on a quarterly basis to ensure that costs and expenses
        actually incurred are within the budgetary limits and cash outlays identified
        in
Exhibit B. No expense or cost incurred not provided for in Exhibit
        B shall be borne by the New Program without the unanimous approval of
        the
        Parties in writing. Expenses internally generated because tasks are performed
        by
        a Party's own staff will be accounted for based upon actual employee salaries
        and fringe benefits (at 20% of salary) and variable expenses and directly
        applicable overhead allocations. 

      

      6.3.8.2 Adjustments
        for Costs. Each Party will be
        responsible for all its costs with respect to participation of its own staff
        on
        the Development Team and the Project Committee throughout the duration of
        the
        development of the Phase I New Program, including travel expenses for meetings
        and participation on the respective teams or Project Committee. The goal
        of
        equality in expenditures shall be regarded with respect to these costs, and
        these costs shall be reflected and adjusted in the Revenue Sharing Formula
        (as
        defined below in Section 9).

      

      6.4 Pricing.
        The Parties shall within 90 days of the
        Effective Date prepare and agree upon an initial pricing policy for the New
        Program. Such pricing policy shall be subject to review from time to time
        and
        amended by the Parties upon the recommendation of the Project Committee.
        Prices
        set through the pricing policy shall be subject to, and modified to comply
        with
        all applicable laws and regulations governing the New Program. 

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      

      6.5 Sales
        Targets. Notwithstanding the provisions of
        Section 2.1 above, the Parties understand that though the technical and
        commercial feasibility of the Project has not been established, it is the
        intent
        of the Parties that Siboney commits to, and Siboney hereby agrees and commits
        to, minimum annual revenues from sales of the New Program as follows:

      

      
        	
                Minimum
                  Revenues $

              	
                Year

              
	
                $250,000

              	
                2007

              
	
                $1,300,000

              	
                2008

              
	
                $2,200,000

              	
                2009

              

      

      

      Siboney
        shall use
        commercially reasonable efforts to achieve the minimum sales targets specified
        above. If Siboney fails to achieve the minimum sales target as specified
        above
        for 2 consecutive years, then Edumatics shall have the option but not the
        obligation, exercisable in its sole discretion to either assume or sub-assign
        the marketing to a third party at Edumatics’ sole discretion or sell the New
        Program to a third party, in which event this Section 6.5 shall apply rather
        than Section 16.6.  If Edumatics decides to market (rather than liquidate)
        Edumatics will pay Siboney 40% of the proceeds after all applicable and
        reasonable expenses including all reasonable marketing expenses of the New
        Program incurred by Edumatics.  If Edumatics chooses to liquidate the New
        Program Edumatics will retain a liquidation preference of one times (1x)
        the
        total investment made by Edumatics; after Edumatics has deducted its liquidation
        preference, then Siboney will retain a liquidation preference of one-half
        times
        (1/2x) the total investment made by Siboney; and any remaining proceeds (after
        deducting Edumatics’ and Siboney’s liquidation preference) will be divided
        50%-50%. Edumatics agrees to provide Siboney with a first right of refusal
        to
        purchase the New Program at the agreed-upon price with the potential buyer
        of
        the New Program. This is Edumatics’ sole remedy for Siboney’s failure to meet
        the minimum sales targets and such failure does not constitute a material
        breach
        of this agreement.

      

      6.6 Use
        of Name in Promotional Materials. Each Party
        shall, with prior approval of the other Party (which shall not be unreasonably
        withheld or delayed), be permitted to identify the other Party as a strategic
        partner, to use the other Party's name in connection with proposals to
        prospective customers, and to refer to the other Party in print or electronic
        form for marketing or reference purposes, provided however that such proposals
        and marketing and reference materials shall not promote any third party or
        the
        products of any third party.

      

      7. REPRESENTATIONS
        AND
        WARRANTIES.

      

      7.1 Representations
        and Warranties of Edumatics.
        Edumatics represents and covenants to Siboney, as of the Effective Date,
        that:
        (i) it has full power and authority to enter into and perform this Agreement;
        (ii) it owns or has obtained the necessary rights, title and interest to
        Sole
        Edumatics Intellectual Property and to Edumatics’ contribution to the Joint
        Intellectual Property (as hereinafter defined) including any third party
        technology embedded therein; (iii) it has or will obtain from its employees,
        agents and consultants who perform work with respect to the New Program in
        accordance with this Agreement a valid and sufficient written agreement vesting
        ownership of all their discoveries, improvements and ideas in Edumatics;
        (iv)
        there are no pending material patent, copyright, trademark or other

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      intellectual
        property infringement claims against Edumatics with
        respect to any Sole Edumatics Intellectual Property; and (v) its performance
        of
        the obligations under this Agreement does not and shall not violate: any
        applicable law, rule, or regulation; any contracts with third parties; or
        any
        third party rights in any patent, trademark, copyright, trade secret, or
        any
        other proprietary right anywhere in the world.

      

      7.2 Representations
        and Warranties of Siboney. Siboney
        represents and covenants to Edumatics, as of the Effective Date, that: (i)
        it
        has full power and authority to enter into and perform this Agreement; (ii)
        it
        owns or has obtained the necessary rights, title and interest to Sole Siboney
        Intellectual Property and to Siboney’s contribution to the Joint Intellectual
        Property (as hereinafter defined) including any third party technology embedded
        therein; (iii) it has or will obtain from its employees, agents and consultants
        who perform work with respect to the New Program in accordance with this
        Agreement a valid and sufficient written agreement vesting ownership of all
        their discoveries, improvements and ideas in Siboney; (iv) there are no pending
        material patent, copyright, trademark or other intellectual property
        infringement claims against Siboney with respect to any Sole Siboney
        Intellectual Property; and (v) its performance of the obligations under this
        Agreement does not and shall not violate: any applicable law, rule, or
        regulation; any contracts with third parties; or any third party rights in
        any
        patent, trademark, copyright, trade secret, or any other proprietary right
        anywhere in the world.

      

      8. OWNERSHIP
        AND RIGHTS RELATING TO
        INTELLECTUAL PROPERTY.

      

      8.1 For
        the avoidance of doubt, the Parties agree that the
        results of the efforts by either Party under this Agreement including the
        New
        Program shall not be considered “work for hire”, and that neither Party acquires
        any exclusive rights to, or licenses to use, any such results including the
        New
        Program except as expressly set forth in this Agreement.

      

      8.2 Edumatics
        shall own all Edumatics Background Rights (as
        hereafter defined) including Sole Edumatics Intellectual Property (as hereafter
        defined).

      

      “Edumatics
        Background Rights” means all
        intellectual property rights owned or controlled by Edumatics except for
        Joint
        Intellectual Property (as hereafter defined).

      

      “Sole
        Edumatics Intellectual Property” means all
        intellectual property, including intellectual property rights associated
        with
        the science program and/or its digital educational content libraries, as
        the
        case may be, conceived by Edumatics, its employees, agents, partners, either
        solely or jointly with non-Party contractors of Edumatics, prior to the
        execution of this Agreement. Intellectual property rights include, by way
        of
        example, patents, patent applications, know-how, trade secrets, and other
        confidential information, and copyrights. Sole Edumatics Intellectual Property
        shall constitute one type of Edumatics Background Rights. 

      

      8.3 Siboney
        shall own all Siboney Background Rights (as
        hereafter defined) including Sole Siboney Intellectual Property (as hereafter
        defined).

      

      “Siboney
        Background Rights” means all intellectual property rights owned or
        controlled by Siboney except for Joint Intellectual Property.

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      “Sole
        Siboney Intellectual Property” means all intellectual property
        including intellectual property rights associated with the Orchard, Journey,
        TSS
        and EA/RA products and/or its digital educational content libraries, as the
        case
        may be, conceived by Siboney, its employees, agents, partners, either solely
        or
        jointly with non-Party contractors of Siboney, prior to the execution of
        this
        Agreement. Intellectual property rights include, by way of example, patents,
        patent applications, know-how, trade secrets, and other confidential
        information, and copyrights. Sole Siboney Intellectual Property shall constitute
        one type of Siboney Background Rights. 

      

      8.4 Subject
        to any other express provisions of this
        Agreement, Edumatics and Siboney shall jointly own all Joint Intellectual
        Property (as hereafter defined).

      

      “Joint
        Intellectual Property” means all
        intellectual property that both (a) is comprised in and/or accruing to the
        New
        Program including the test item bank referenced in Section 5.2, and (b) is
        conceived during the term of this Agreement either jointly by the Parties
        or
        independently by either Party or by one or more of their respective employees,
        agents, partners or non-Party independent contractors. For purposes of part
        (a)
        of this definition of Joint Intellectual Property, intellectual property
        shall
        be deemed to relate to the New Program if such intellectual property relates
        to
        the functionalities/specifications attached hereto as Exhibit A Section:
        Online
        Product Offerings-Proposed Online Products-Phase I.

      

      8.5 Neither
        Party acquires any rights, either express or
        implied, under any Background Rights of the other Party unless expressly
        stated
        in this Agreement or another written agreement signed by authorized
        representatives of each of the Parties. 

      

      8.6 Except
        as provided in Sections 8.7, 8.8 and 10 below,
        each Party shall have the right to operate under Joint Intellectual Property
        and
        grant nonexclusive licenses to third parties as they may desire without
        accounting to the other Party.

      

      8.7 Edumatics
        agrees to grant and does hereby grant to
        Siboney the exclusive, worldwide, royalty-free right under Joint Intellectual
        Property and Sole Edumatics Intellectual Property, with the right to sublicense
        and authorize the granting of sublicenses, to the extent that such Sole
        Edumatics Intellectual Property is incorporated into the New Program, to
        use,
        sell, offer for sale, import, or otherwise commercially exploit the New Program
        in terms of this Agreement. 

      

      8.8 Siboney
        agrees to grant and does hereby grant to
        Edumatics the exclusive, worldwide, royalty-free right under Joint Intellectual
        Property and Sole Siboney Intellectual Property, with the right to sublicense
        and authorize the granting of sublicenses, to the extent that such Sole Siboney
        Intellectual Property is incorporated into the New Program, to use, sell,
        offer
        for sale, import, or otherwise commercially exploit the New Program in terms
        of
        this Agreement. 

      

      8.9 Edumatics
        and Siboney may jointly file any applications
        for copyright/patents on material/inventions that are Joint Intellectual
        Property. The applications shall be prepared and prosecuted by a mutually
        acceptable intellectual property rights attorney with the expenses of
        preparation, prosecution and maintenance to be shared equally between the
        Parties. If one Party elects not to pursue any such application, the other
        Party
        may do so on its own, at its own expense, but the non-electing Party must
        provide reasonable cooperation,

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      sign
        the required documents, etc.

      

      9. REVENUE
        SHARING.

      

      9.1 Revenue
        Share Formula. Revenues net of expenses shall be shared as per the following
        formula:

      

      Edumatics
        - 50%

      Siboney
        - 50%

      

       

      9.2 Payments.
        Revenues shall be shared between the
        Parties on a quarterly basis. In this regard, Siboney shall maintain appropriate
        and separate accounts for sales/license of the New Program, and Siboney shall,
        within fifteen (15) days of the end of each calendar month, furnish Edumatics
        with a report detailing current month and year-to-date results for total
        sales
        and dollar amounts in comparison with the Sales Target described in Section
        6.5
        above. In the monthly sales report, Siboney shall provide sales details for
        the
        New Program (by location/distribution channels, etc.). 

      

      9.3 Reconciliation.
        Payments made to the Parties shall
        be reconciled against inputs/resources contributed and expensed and other
        expenses and costs on a quarterly basis. In the event a reconciliation results
        in a credit or debit balance to a Party’s account, the amount of the credit or
        debit, as the case may be, shall immediately be paid to or by the Party
        concerned. 

      

      9.4 Audits
        by Edumatics. Edumatics shall have the
        right to inspect Siboney’s books and records as they relate to sales/license of
        the New Program, at such times, which times shall be not (a) less than fifteen
        (15) days following Edumatics’ request to conduct an audit, and (b) (unless
        otherwise required by applicable statutes, rules, regulations or otherwise
        requested by any governmental agencies or instrumentalities) not more frequently
        than once in each year of this Agreement and one time during the twelve (12)
        month period following the end of a term of this Agreement, to the extent
        necessary to determine and confirm financial and other appropriate matters
        pertaining to the activities contemplated by this Agreement, including, without
        limitation, the gross revenue received and other activities and matters
        contemplated by this Agreement. Edumatics shall also have the right to arrange
        such other audits as requested by any governmental agencies and
        instrumentalities. Any dispute pursuant to this provision is subject to the
        provisions of Section 19.9 hereof.

      

      9.5 Audits
        by a Third Party. Siboney agrees to allow
        independent CPA/auditors appointed by Edumatics, which auditors shall not
        be
        compensated on a contingency basis and shall be bound to keep all information
        confidential except as necessary to disclose discrepancies to the other Party,
        to audit and analyze relevant accounting records of Siboney to ensure compliance
        with all terms of this Agreement. Any such audit shall be permitted within
        thirty (30) days of Siboney’s receipt of a written request to audit from
        Edumatics, during normal business hours, at a time mutually agreed upon.
        The
        cost of such an audit shall be borne by Edumatics unless a discrepancy of
        more
        than 10%, but not less than $10,000, of a quarterly reconciliation is found
        in
        the records, in which case the cost of the audit shall be borne by Siboney.
        Audits shall occur no more frequently than once per calendar year and shall
        not
        interfere unreasonably with Siboney’s business activities and shall

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      be
        conducted in Siboney’s facilities during normal business hours
        on reasonable notice. An audit may cover any period; provided that: (i) the
        period has not been previously audited; and (ii) the period under audit is
        immediately preceding the commencement of the audit. Siboney shall promptly
        reimburse and pay to Edumatics the amount of any discrepancy arising out
        of such
        audit which indicates that Edumatics is owed amounts hereunder as well as
        the
        costs of the audit, if applicable, as provided above. Any dispute pursuant
        to
        this provision is subject to the provisions of Section 19.9 hereof. In any
        event, for a period of at least 12 months following the date of termination
        or
        expiration of this Agreement, Siboney shall keep available for inspection
        by
        Edumatics and its representatives for any reasonable purpose all records,
        files,
        documents and correspondence relating to the Project.

      

      10. EXCLUSIVITY
        AND
        NON-COMPETE.

      

      During
        the term of this Agreement (the “Exclusivity Period”),
        neither Party shall, (a) engage in development efforts or marketing or bidding
        (whether or not with a Party’s competitor) to develop or provide solutions that
        compete with the New Program that contain Joint Intellectual Property, or
        (b)
        build substantial capability around a Party’s competitors' products using Joint
        Intellectual Property (including sponsoring or investing in training, marketing
        and solution development of service offerings that include a Party’s competitor
        products and/or that undermine a Party’s market strategy); provided, however,
        that nothing herein shall prohibit a Party from deploying competing products
        where requested or required by a customer in the ordinary course of providing
        consulting services, or engaging in education and training necessary to support
        such deployment. 

      

      11. ESCALATION
        AND DISPUTE
        RESOLUTION.

      

      11.1 Escalation
        and Dispute Resolution for
        Teams.

      

      
        	 	
                11.1.1

              	
                General.

              

      

      

      The
        Parties shall attempt to promptly resolve through good faith
        negotiation any dispute or disagreement between them directly relating to
        development priorities and decisions and resource allocation under the Program
        Plan or this Agreement.

      

      
        	 	
                11.1.2

              	
                Escalation
                  To Project
                  Committee.

              

      

      

      In
        the event of a dispute among the Development Team or Sales and
        Marketing Team, either Party may identify the said dispute for escalation.
        If
        the dispute is not resolved within seven (7) calendar days of such
        identification, then the dispute shall be escalated to the Project Committee.
        The Project Committee shall discuss the dispute within five (5) days of
        escalation and shall render a decision within ten (10) days of their initial
        discussion. If the Project Committee is unable to resolve the dispute within
        ten
        (10) days of their initial discussion then the dispute shall be submitted
        to the
        Senior Executives as set forth in Section 11.1.3.

      

      
        	 	
                11.1.3

              	
                Escalation
                  to Senior
                  Executives.

              

      

      

      In
        the event of a dispute in the Project Committee or a dispute
        has not been resolved by the Project Committee pursuant to Section 11.1.2,
        either Party may identify the said

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      dispute
        for escalation. If the dispute is not resolved within ten
        (10) calendar days of such identification, then the dispute shall be escalated
        to the most senior executives of Edumatics and Siboney. The most senior
        executives shall discuss the dispute within five (5) days of escalation and
        shall render a decision within ten (10) days of their initial discussion.
        If the
        most senior executives are unable to resolve the dispute within ten (10)
        days of
        their initial discussion then the dispute shall be submitted to arbitration
        as
        set forth in Section 19.9.

      

      12. INDEMNIFICATION

      

      12.1 Intellectual
        Property Indemnity from
        Edumatics.

      

      Edumatics
        agrees to defend and indemnify Siboney, its affiliates,
        associates and their respective directors, employees, consultants and officers,
        against any and all liability, loss, damage, cost and expense (including
        cost of
        defense and reasonable attorney's fees) which any or all of them may hereafter
        suffer itself or pay out to another by reason of any claim, or actions arising
        out of such claim, filed and originating in Sole Edumatics Intellectual
        Property.

      

      Edumatics’
        obligations under this Section 12.1 are subject to the following conditions
        and
        obligations of Siboney: (i) Siboney agrees to notify promptly Edumatics upon
        knowledge of any claim, suit, action, or proceeding for which it may be entitled
        to indemnification under this Agreement; (ii) Siboney shall permit Edumatics
        to
        have the sole right to control the defense of any such claim; (iii) Siboney
        agrees to provide reasonable assistance to Edumatics at Edumatics’ expense, in
        the defense of same; and (iv) Siboney will not enter into any settlement
        agreement or otherwise settle any such claim without Edumatics’ express prior
        consent or request. Siboney may, at its own expense, participate in the defense
        of any such claim or action.

      

      In
        addition to its
        obligations set forth in this Section 12.1, Edumatics agrees that in the
        event
        Edumatics or Siboney is enjoined from using Sole Edumatics Intellectual Property
        in terms of this Agreement, Edumatics shall, at its expense, (i) replace
        or
        modify the infringing portion so it becomes non-infringing, yet functionally
        equivalent or (ii) procure for Edumatics and Siboney the right to continue
        using
        the Sole Edumatics Intellectual Property for the New Program in terms of
        this
        Agreement.

      

      12.2 Intellectual
        Property Indemnity from Siboney.

      

      Siboney
        agrees to
        defend and indemnify Edumatics, its affiliates, associates and their respective
        directors, employees, consultants and officers against any and all liability,
        loss, damage, cost and expense (including cost of defense and reasonable
        attorney's fees) which any or all of them may hereafter suffer itself or
        pay out
        to another by reason of any claim, or actions arising out of such claim,
        filed
        and originating in Sole Siboney Intellectual Property.

      

      Siboney’s
        obligations under this Section 12.2 are subject to the following conditions
        and
        obligations of Edumatics: (i) Edumatics agrees to notify promptly Siboney
        upon
        knowledge of any claim, suit, action, or proceeding for which it may be entitled
        to indemnification under this Agreement; (ii) Edumatics shall permit Siboney
        to
        have the sole right to control the defense of any such claim; (iii) Edumatics
        agrees to provide reasonable assistance to Siboney at Siboney’s expense, in the
        defense of same; and (iv) Edumatics will not enter into any settlement agreement
        or otherwise settle any such claim without Siboney’s

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      express
        prior consent or request. Edumatics may, at its own
        expense, participate in the defense of any such claim or action.

      

      In
        addition to its
        obligations set forth in this Section 12.2, Siboney agrees that in the event
        Siboney or Edumatics is enjoined from using Sole Siboney Intellectual Property
        in terms of this Agreement, Siboney shall, at its expense, (i) replace or
        modify
        the infringing portion so it becomes non-infringing, yet functionally equivalent
        or (ii) procure for Siboney and Edumatics the right to continue using the
        Sole
        Siboney Intellectual Property, as the case may be, for the New Program in
        terms
        of this Agreement.

      

      12.3 General
        Indemnity.

      

      Edumatics
        agrees to defend and indemnify Siboney, its affiliates,
        associates and their respective directors, officers and employees against
        all
        liability, loss, damage, costs and expenses (including cost of defense and
        reasonable attorneys' fees) which any or all of them may hereafter suffer
        themselves or pay out to another by reason of any claim, action, or right
        of
        action, at law or in equity because of any injury, including death, to persons
        or damage to tangible property (excluding data or any similar concept) which
        arises out of, or is in connection with the performance of this Agreement
        to the
        extent caused by the negligence or willful misconduct of Edumatics, its
        employees or agents.

      

      Siboney
        agrees to defend and indemnify Edumatics, its affiliates,
        associates and their respective directors, officers and employees against
        all
        liability, loss, damage, costs and expenses (including cost of defense and
        reasonable attorneys' fees) which any or all of them may hereafter suffer
        themselves or pay out to another by reason of any claim, action, or right
        of
        action, at law or in equity because of any injury, including death, to persons
        or damage to tangible property (excluding data or any similar concept) which
        arises out of, or is in connection with the performance of this Agreement
        to the
        extent caused by the negligence or willful misconduct of Siboney, its employees,
        or agents.

      

      13. DISCLAIMER
        OF
        WARRANTIES.

      

      EXCEPT
        AS STATED IN
        THIS AGREEMENT, NEITHER EDUMATICS NOR SIBONEY MAKES ANY OTHER WARRANTIES
        TO THE
        OTHER WITH RESPECT TO THE OPERATION OR PERFORMANCE OF THE NEW PROGRAM DEVELOPED
        OR OTHER INTELLECTUAL PROPERTY LICENSED BY EITHER PARTY TO THE OTHER PURSUANT
        TO
        THIS AGREEMENT, AND EDUMATICS AND SIBONEY EACH HEREBY DISCLAIMS ALL SUCH
        OTHER
        WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE IMPLIED
        WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

      

      14. LIMITATION
        OF LIABILITY; EXCLUSION
        OF DAMAGES.

      

      14.1 Limitation
        of Liability.

      

      Under
        no circumstances shall either Party's total liability of all
        kinds arising out of or related to this Agreement regardless of the forum
        and
        regardless of whether any action or claim is based in contract, tort negligence
        or otherwise, exceed $600,000.

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      

      14.2 Exclusion
        of Damages.

      

      Neither
        Party
        hereto shall, under any circumstances, be liable to the other for indirect,
        consequential, punitive, incidental, special or exemplary damages, even if
        apprised of the likelihood of such damages occurring.

      

      14.3 Exceptions.

      

      The
        exclusions of
        damages and limitations of liability set forth in sections 14.1 and 14.2
        above
        shall not operate to limit amounts actually due and payable pursuant to the
        express terms of this Agreement.

      

      15. CONFIDENTIALITY.

      

      15.1 Confidential
        Information

      

      As
        used herein,
        "Confidential Information" shall mean, without limitation, any non-public
        communications, written or oral, involving a Party's non-public business
        information, technical information or data, however embodied, marketing plans,
        financial information and strategic plans or any other information identified
        in
        writing as confidential or proprietary.

      

      15.2 Confidentiality
        Obligations

      

      15.2.1 The
        Parties hereby covenant and agree that, except as
        required by law and as provided in this Section, they shall not disclose
        the
        terms and conditions of this Agreement to any other person or entity (other
        than
        their counsel and auditors) without obtaining the prior written consent of
        the
        other Party, except to the extent necessary to effect the transactions and
        actions contemplated herein.

      

      15.2.2 Each
        Party may furnish to the other Party in
        connection with this Agreement certain Confidential Information. The Party
        disclosing such Confidential Information is referred to as the
        "Discloser", and the Party receiving such Confidential
        Information is referred to as the "Recipient." Each Party
        agrees that it shall keep in confidence and prevent the acquisition, disclosure,
        use or misappropriation by any person or persons of Confidential Information
        which is received from the other under this Agreement, provided, however,
        that
        neither Party shall be liable for disclosure of any such information if the
        same
        is disclosed with the prior written approval of the other Party. Each Party
        agrees that if it breaches the provisions of this Section, the Discloser
        of the
        Confidential Information may suffer irreparable injury and shall be entitled
        to
        seek a temporary and permanent injunction, in addition to the other remedies
        for
        breach of the Agreement.

      

      15.2.3 Recipient
        shall use the same care and discretion to
        avoid disclosure, publication or dissemination of Confidential Information
        as it
        uses with its own similar confidential information that it does not wish
        to
        disclose, publish or disseminate provided that Recipient shall use at least
        reasonable care. The Confidential Information is not to be disclosed to any
        persons other than the employees of the Recipient who have a need to know.
        Except as expressly provided by this Agreement, Recipient shall not use
        Confidential Information in any manner, nor use it for the benefit of anyone
        but
        Discloser.

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      

      15.2.4 The
        obligations of Recipient with respect to any
        particular portion of Confidential Information shall terminate or shall not
        attach, as the case may be, when any of the following occurs: (i) it was
        in the
        public domain at the time of Discloser's communication thereof to Recipient;
        (ii) it entered the public domain through no fault of Recipient subsequent
        to
        the time of Discloser's communication thereof to Recipient; (iii) it was
        in
        Recipient's possession free of any obligation of confidence at the time of
        Discloser's communication thereof to Recipient; (iv) it was independently
        developed by Recipient; or (v) its disclosure is required pursuant to applicable
        law (including securities laws) or by a court or government order and Discloser
        has been given reasonable notice of such order and a reasonable opportunity
        to
        seek a protective order.

      

      15.2.5 All
        such Confidential Information shall remain the
        exclusive property of Discloser. The confidentiality obligations shall survive
        any termination of this Agreement and shall continue for so long as the
        Confidential Information is the property of Discloser or for as long as
        otherwise permitted by law. 

      

      15.2.6 All
        individuals engaged in the developmental effort
        towards creating the New Program will be prohibited from using or disclosing
        any
        Confidential Information or trade secrets learned or developed in the course
        of
        such development effort other than in the course of their work on the
        developmental effort or their work for Edumatics or Siboney, respectively.
        

       

      16. TERM
&
        TERMINATION.

      

      16.1 Term.
        This Agreement shall remain in full force
        and effect following the Effective Date until terminated by mutual written
        agreement of the Parties. It is the intent of the Parties that neither Party
        shall withdraw or excuse itself from the performance of its obligations under
        this Agreement for any reason whatsoever. This Agreement may otherwise be
        terminated for the reasons specified in Sections 16.2 to 16.4 below. 

      

      16.2 Termination
        for Material Breach. Either Party
        (the “Terminating Party”) may terminate this Agreement by
        giving thirty (30) days' prior written notice to the other Party
        (“Non-Terminating Party”) upon the occurrence of a material
        breach by the Non-Terminating Party of the terms of this Agreement unless
        such
        breach is cured by the Non-Terminating Party within such thirty (30) day
        period.

      

      16.3 Termination
        as a Result of Bankruptcy. This
        Agreement may be terminated by either Party (a “Terminating
        Party”) effective immediately and without any requirement of notice, in
        the event that the other Party (“Non-Terminating Party”) (i)
        files a petition, in bankruptcy, seeking any reorganization, arrangement,
        composition, or similar relief under any law regarding insolvency or relief
        for
        debtors, or makes an assignment for the benefit of creditors; (ii) a receiver,
        trustee, or similar officer is appointed for the business or property of
        the
        Non-Terminating Party; (iii) any involuntary petition or proceeding, under
        bankruptcy or insolvency laws, is instituted against the Non-Terminating
        Party
        and not stayed, enjoined, or discharged within sixty (60) days; or (iv) the
        Non-Terminating Party adopts a resolution for discontinuance of its business
        or
        for dissolution.

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      

      16.4 Termination
        for a Change of Control. Either Party
        may terminate this Agreement within three months of the occurrence of any
        of the
        following transactions by a Party (“Defaulting Party”) with a
        competitor of the other Party (“Non-defaulting Party”): (i) a
        merger, consolidation or other business combination or transaction to which
        the
        Defaulting Party is a party if the shareholders of the Defaulting Party
        immediately prior to the effective date of such merger, consolidation or
        other
        business combination or transaction, as a result of such share ownership,
        have
        beneficial ownership of voting securities representing less than 50% of the
        total current voting power of the surviving entity following such merger,
        consolidation or other business combination or transaction; (ii) an acquisition
        by any person or entity of direct or indirect beneficial ownership of voting
        stock of the Defaulting Party representing 50% or more of the total current
        voting power of the Defaulting Party; (iii) an acquisition of direct or indirect
        beneficial ownership of voting stock of the Defaulting Party representing
        25% or
        more of the total current voting power of the Defaulting Party; or (iv) a
        sale
        of all or substantially all of the assets of the Defaulting Party. 

      

      16.5 Termination
        or Withdrawal Prior to Completion. If
        prior to the completion of the New Program: 

      

      (a) a
        Party withdraws from participating in the Project for
        any reason whatsoever (such withdrawal not being a termination pursuant to
        the
        provisions of this Agreement); or

      

      (b) this
        Agreement is terminated in terms of Section 16.2 or
        Section 16.3; or 

      

      (c) the
        Defaulting Party enters into one or more of the
        transactions described in (i), (ii), (iii) or (iv) of Section 16.4 above,
        with a
        competitor of the Non-Defaulting Party and the Non-Defaulting Party elects
        to
        terminate this Agreement pursuant to Section 16.4,

      

      then,
        the withdrawing Party/Non-Terminating Party/Defaulting
        Party, as the case may be, shall cease to have any rights, interest or title
        in
        and to any and all materials, deliverables, Joint Intellectual Property,
        etc.
        created up to the date of such withdrawal and/or termination, to the New
        Program
        in any manner whatsoever. In addition, the withdrawing Party/Non-Terminating
        Party/Defaulting Party, as the case may be, shall be deemed to have assigned
        to
        the non-withdrawing Party/Terminating Party/Non-Defaulting Party, as the
        case
        may be, all its intellectual property rights including, by way of example,
        patents, patent applications, know-how, trade secrets, and other confidential
        information, and copyrights, rights, in and to any and all materials,
        deliverables, Joint Intellectual Property, etc. created up to the date of
        such
        withdrawal and/or to the New Program in any manner whatsoever. In the event
        that
        the withdrawing Party/Non-Terminating Party/Defaulting Party, as the case
        may
        be, is Edumatics, then the trademark license to Edumatics (as referenced
        in
        Section 6.3.7.2) shall terminate. In the event that the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, is Siboney,
        then Siboney shall assign all of its right, title and interest in and to
        the New
        Program Trademark to Edumatics.

      

      16.6 Termination
        or Withdrawal after Completion of New
        Program. If at any time after completion of the New Program: 

      

      (a) a
        Party withdraws from participating in the Project for
        any reason whatsoever (such withdrawal not being a termination pursuant to
        the
        provisions of this Agreement); or

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      

      (b) this
        Agreement is terminated in terms of Section 16.2 or
        Section 16.3; or 

      

      (c) the
        Defaulting Party enters into one or more of the
        transactions described in (i), (ii), (iii) or (iv) of Section 16.4 above,
        with a
        competitor of the Non-Defaulting Party and the Non-Defaulting Party elects
        to
        terminate this Agreement pursuant to Section 16.4,

      

      then,
        the non-withdrawing Party/Terminating Party/Non-Defaulting
        Party, as the case may be, shall have the option but not the obligation,
        exercisable in its sole discretion, to acquire the pro-rata share of the
        withdrawing Party/Non-Terminating Party/Defaulting Party, as the case may
        be, in
        the New Program, including all rights in the Joint Intellectual Property,
        at a
        pre-determined price of one times (1x) the monetary value of the Development
        Team resources contributed by the withdrawing Party/Non-Terminating
        Party/Defaulting Party, as the case may be, till the date of such withdrawal
        and/or termination, as the case may be. If the Parties do not agree on the
        monetary value of the resources/inputs contributed by the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, then the
        same
        shall be determined by an independent CPA appointed by the non-withdrawing
        Party/Terminating Party/Non-Defaulting Party, as the case may be. The cost
        of
        the independent CPA shall be deducted from the non-withdrawing Party/Terminating
        Party/Non-Defaulting Party, as the case may be, unless a discrepancy of more
        than 10% from the monetary value assessed by the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, is found
        in
        the records, in which case the cost of the audit shall be borne by the
        withdrawing Party/Non-Terminating Party/Defaulting Party, as the case may
        be.
        The closing of the acquisition of the pro-rata share of the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, shall be
        completed within sixty (60) days of determination of the monetary value of
        the
        resources/inputs contributed by the withdrawing Party/Non-Terminating
        Party/Defaulting Party, as the case may be, whereupon the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, shall cease
        to
        have any rights, interest or title in and to the New Program and Joint
        Intellectual Property. In the event that the above-referenced option is
        exercised and the withdrawing Party/Non-Terminating Party/Defaulting Party,
        as
        the case may be, is Edumatics, then the trademark license to Edumatics (as
        referenced in Section 6.3.7.2) shall terminate. In the event that the
        above-referenced option is exercised and the withdrawing Party/Non-Terminating
        Party/Defaulting Party is Siboney, then Siboney shall assign all of its right,
        title and interest in and to the New Program Trademark to Edumatics.

      

      If
        the
        non-withdrawing Party/Terminating Party/Non-Defaulting Party, as the case
        may
        be, does not exercise its option as aforesaid, then the withdrawing
        Party/Non-Terminating Party/Defaulting Party shall have the option to buy-out
        the non-withdrawing Party/Terminating Party/Non-Defaulting Party for one
        and one
        half times 1.5x the actual development cost of the non-withdrawing
        Party/Terminating Party/Non-Defaulting Party. If the withdrawing
        Party/Non-Terminating Party/Defaulting Party is unwilling or unable to buy-out
        the non-withdrawing Party/Terminating Party/Non-Defaulting Party as aforesaid,
        then the non-withdrawing Party/Terminating Party/Non-Defaulting Party shall
        obtain all rights to the New Program at no cost. In the event that the
        above-referenced option is not exercised and the withdrawing
        Party/Non-Terminating Party/Defaulting Party, as the case may be, is Edumatics,
        then the trademark license to Edumatics (as referenced in Section 6.3.7.2)
        shall
        terminate. In the event that the above-referenced option is not exercised
        and
        the withdrawing Party/Non-Terminating Party/Defaulting Party is Siboney,
        then
        Siboney shall

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      assign
        all of its right, title and interest in and to the New
        Program Trademark to Edumatics.

      

      16.7 Rights
        to use Joint Intellectual Property to develop
        derivative works for non-competing products. At any time after completion of
        the New Program, either Party shall have the option exercisable in its sole
        discretion, to create derivative works using Joint Intellectual Property
        which
        do not compete with the New Program. Subject to the terms of this agreement,
        Edumatics’ right to create such derivative works extends to its parent company
        Educomp Solutions Ltd. or any of its subsidiaries or affiliates. In no event
        shall either Party use the New Program Trademark in connection with the
        marketing or sale of such derivative works. 

      

      16.8 Return
        of Confidential Information. Upon
        termination of this Agreement for any reason whatsoever, and except as is
        required to utilize any licenses granted under this Agreement, both Edumatics
        and Siboney shall return all Confidential Information (including tangible
        products or materials) received by that Party from the other Party, at the
        request of the other Party; provided, however, that the receiving Party may
        retain one (1) secure archival copy of any Confidential Information received
        in
        writing from another Party for record purposes to determine its on-going
        confidentiality obligations under this Agreement.

      

      17. SURVIVAL.

      

      Sections
        7, 8, 9,
        10, 12, 13, 14, 15, 16.5, 16.6, 16.7, 17, 19.1, 19.4, 19.9, 19.10, and 19.11
        shall survive any termination of this Agreement and remain in full force
        and
        effect.

      

      18. INDEPENDENT
        CONTRACTOR
        STATUS.

      

      In
        connection with
        this Agreement, each Party is an independent contractor and as such will
        not
        have any authority to bind or commit the other Party. Nothing herein shall
        be
        deemed or construed to create a joint venture, partnership, fiduciary or
        agency
        relationship between the Parties for any purpose. Each Party shall be solely
        responsible for its personnel, employees and consultants hired by it for
        the
        purpose of performing specific obligations pursuant to this Agreement. 

      

      19. MISCELLANEOUS.

      

      19.1 Other
        Remedies Cumulative. Except where otherwise
        specified, the rights and remedies granted to a Party under this Agreement
        are
        cumulative and in addition to, and not in lieu of, any other rights or remedies
        which the Party may possess at law or in equity, including, without limitation,
        rights or remedies under applicable patent, copyright, trade secret or
        proprietary rights laws, rules or regulations.

      

      19.2 Public
        Communications. Except as required by law,
        no public announcements or public disclosure regarding this relationship
        shall
        be made without the prior written agreement of the Parties. The Parties will
        agree upon a joint press release upon the conclusion of this Agreement or
        at
        such other time as the Parties may mutually determine and agree. 

      

      19.3 Assignment.
        Except as set forth in this Section,
        neither Party shall transfer or assign its rights or obligations under this
        Agreement without the prior written consent of the

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      other
        Party and any purported assignment in violation of the
        foregoing shall be null and void. Either Party shall have the right to assign
        this Agreement, as a whole, to any successor in interest to all or substantially
        all of such Party's business or assets, whether by merger, reorganization,
        asset
        sale or otherwise, subject to the provisions of Section 16.4. Subject to
        the
        foregoing, this Agreement will be binding upon and inure to the benefit of
        the
        Parties hereto, their successors and permitted assigns.

      

      19.4 No
        Implied Waivers. The delay or failure by
        either Party to exercise or enforce any of its rights under this Agreement
        shall
        not constitute or be deemed a waiver of that Party's right thereafter to
        enforce
        those rights, nor shall any single or partial exercise of any such right
        preclude any other or further exercise thereof or the exercise of any other
        right.

      

      19.5 Severability.
        If any term or provision of this
        Agreement is found by a court of competent jurisdiction to be invalid, illegal
        or otherwise unenforceable, the same shall not affect the other terms or
        provisions hereof or the whole of this Agreement, but such term or provision
        shall be deemed modified to the extent necessary in the court's opinion to
        render such term or provision enforceable, and the rights and obligations
        of the
        Parties shall be construed and enforced accordingly, preserving to the fullest
        permissible extent the intent and agreements of the Parties herein set forth.
        

      

      19.6 Force
        Majeure. Except for payment of monies,
        neither Party shall be liable for failure to fulfill its obligations under
        this
        Agreement due to causes beyond its reasonable control, including, but not
        limited to, acts of God, man-made or natural disasters, earthquakes, fire,
        riots, flood, strikes or acts of war. The time for performance of any such
        obligation shall be extended for the time period lost by reason of the delay.
        

      

      19.7 Headings.
        Headings of Sections and Sub-Sections
        herein are inserted for convenience of reference only and shall not affect
        the
        construction or interpretations of this Agreement. 

      

      19.8 Notice.
        Any notice or other communication given
        pursuant to this Agreement shall be in writing and shall be effective either
        when delivered personally to the Party for whom intended, or five (5) days
        following deposit of the same into the United States mail (certified mail,
        return receipt requested, or first class postage prepaid), facsimile (with
        confirmation of delivery) or overnight delivery services (with confirmation
        of
        delivery), addressed to such Party at the address set forth on the initial
        Page
        of this Agreement. Either Party may designate a different address by notice
        to
        the other given in accordance herewith. 

      

      19.9 Dispute
        Resolution; Arbitration. Following the
        Parties' compliance with the preceding Section, all controversies, except
        disputes where a Party seeks injunctive relief, arising from or relating
        to this
        Agreement or the performance or breach thereof shall be resolved through
        binding
        arbitration conducted in St. Louis, Missouri, under and subject to the
        commercial Arbitration Rules of the American Arbitration Association
        ("AAA") then in effect. The arbitration shall be conducted
        before a panel of three (3) arbitrators, chosen according to the rules of
        the
        AAA from among its Panel of Commercial Arbitrators within two (2) weeks of
        the
        first filing before the AAA, each of whom shall be and remain independent
        of the
        Parties. Edumatics shall appoint one arbitrator, Siboney shall appoint one
        (1)
        arbitrator, and the two (2) appointed arbitrators shall choose the third
        arbitrator who will act as the

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      chairperson
        of the arbitration. If the two (2) arbitrators
        appointed by the Parties are not able to agree on the third arbitrator within
        thirty (30) days from the date that the last such arbitrator was appointed,
        the
        third arbitrator shall be appointed by the AAA. Each of such appointees must,
        however, meet the qualifications set forth in the second sentence of this
        Section. 

      

      19.10 Governing
        Law.  This Agreement shall be
        governed by and construed in accordance with the internal laws of the State
        of
        Missouri, excluding its choice of law provisions. The Parties expressly agree
        to
        exclude the application of the U.N. Convention on Contracts for the
        International Sale of Goods (1980) to this Agreement and the performance
        of the
        Parties contemplated herein, to the extent that such convention might otherwise
        be applicable. 

      

      19.11 Jurisdiction.
        Subject to the arbitration
        provisions contained in Section 19.9 above, the Parties may apply to any
        court
        of competent jurisdiction for temporary or preliminary injunctive relief,
        without breach of Section 19.9. 

      

      19.12 Entire
        Agreement. This Agreement and the
        Exhibits attached hereto set forth the entire understanding between the Parties
        hereto and supersedes all prior agreements, arrangements and communications,
        whether oral or written, with respect to the subject matter hereof. 

      

      19.13 Amendment
        by Written Agreement Only. Neither
        this Agreement nor any of the Exhibits attached hereto may be modified or
        amended except by the mutual written agreement of the Parties. No waiver
        of any
        provision of this Agreement shall be effective unless it is in writing and
        signed by the Party against which it is sought to be enforced.

      

      19.14 Standard
        Terms of a Party. No terms, provisions
        or conditions of any purchase order, acknowledgment or other business form
        that
        a Party may use in connection with acquisition or licensing will have any
        effect
        on the rights, duties or obligations of the Parties under, or otherwise modify,
        this Agreement, regardless of any failure of a Party to object to such terms,
        provisions or conditions. 

      

      19.15 Governmental
        Approvals. Each Party represents
        and warrants that it has obtained or will obtain all required approvals of
        the
        applicable government in connection with this Agreement and that the provisions
        of this Agreement and the rights and obligations of the Parties hereunder,
        are
        enforceable under the applicable laws. If a Party deems that, in order to
        ensure
        compliance with antitrust laws, it is necessary to effect a notification
        of this
        Agreement to any competent antitrust authority, then the Parties shall cooperate
        to effect such notification provided nothing herein shall be construed to
        create
        any obligation for a Party to effect such notification if such Party believes,
        or has reason to believe, that such notification is or may be contrary to
        its
        legal interests. 

      

      19.16 Counterparts.
        This Agreement may be executed in
        counterparts, each of which so executed will be deemed to be an original
        and
        such counterparts together will constitute one and the same agreement. 

      

      19.17 Non-Solicitation.
        The Parties acknowledge and
        agree that the employees and consultants of a Party who perform the development
        and editorial content review services or

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

      other
        services are a valuable asset to such Party and are
        difficult to replace. Accordingly, the Parties agrees that, for a period
        of
        twelve (12) months after termination of this Agreement, neither Edumatics
        nor
        Siboney will solicit for employment whether as an employee, independent
        contractor, or consultant, any of the other Party’s employees or consultants who
        perform any of the development and editorial content review services or other
        material services pursuant to this Agreement. 

      

      19.18 FCPA.
        In conformity with the United States
        Foreign Corrupt Practices Act and with their established corporate policies
        regarding foreign business practices, the Parties and their employees and
        agents
        shall not directly or indirectly make an offer, payment, promise to pay,
        or
        authorize payment, or offer a gift, promise to give, or authorize the giving
        of
        anything of value for the purpose of influencing an act or decision of an
        official of any foreign Government or the United States Government (including
        a
        decision not to act) or inducing such a person to use his influence to affect
        any such governmental act or decision in order to assist a Party in obtaining,
        retaining or directing any such business. 

      

      [SIGNATURE
        PAGE FOLLOWS] 

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Parties have caused their
        duly authorized representatives to enter into this Agreement effective on
        the
        Effective Date.

      

      

      
        	
                /s/
                  Sandeep
                  Kumar                        
                  

              	
                 
/s/
                  William D.
                  Edwards                 
                  

              
	
                For
                  and on behalf of Edumatics

              	
                For
                  and on behalf of Siboney

              
	
                Name:
Sandeep
                  Kumar                 
                  

              	
                Name:
William
                  D. Edwards     
                  

              
	
                Designation:
                  President                 
                  

              	
                Designation:
                  President              
                  

              
	 	 
	 	 
	
                Witnesses:

              	 
	 	 
	
                Name:
                  _____________________

              	
                Name:
                  _______________________

              
	
                Occupation:
                  _________________

              	
                Occupation:
                  ___________________

              
	
                Address:
                  ____________________

              	
                Address:
                  _____________________

              
	
                ____________________________

              	
                _____________________________

              

      

      

      

      

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

      

      

      Exhibit
        A

      

      Online
        Products Business Plan

      

      

      

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

      Exhibit
        B

      

      Online
        Solution Financial
        Contributions

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

      

      Exhibit
        C

      

      Online
        Solution Project Plan

       

       

       

       

      27

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