1.       DEFINITIONS .  Capitalized terms not otherwise defined herein shall have the meanings specified below.

1.1   “ Acquisition ” is defined in Section 11.8 hereof.

1.2   “ Payments/Advances ” is defined in Section 4.1(ii) hereof.

1.3   “ Affiliate ” means any distributor or franchisee of HSWI or any company or other entity worldwide, including without limitation corporations, partnerships, joint ventures, and limited liability companies in which HSWI directly or indirectly holds at least a 19% ownership, equity, control or financial interest and which HSWI intends to enjoy any of HSWI’s rights hereunder.  A list of Affiliates as of the Effective Date is attached hereto as Attachment A .   Attachment A may be modified from time to time upon notice by HSWI to reflect a revised list of Affiliates and each modified Attachment A shall be deemed incorporated herein by reference.

1.4   “ Affinity ” means the arrangement of Reference Content and Images into articles about a variety of subjects as agreed by HSWI and World Book in accordance with this Agreement and identified in detail in Schedule A .

1.5   “ Article ” is defined in Section 2.2(i) hereof.

1.6   “ Buy-Out Fee ” is defined in Section 4.2   hereof.

1.7   “ Competitors ” is defined in Section 11.8 hereof.

1.8   “ Competitors II ” is defined in Section 2.1(ii) hereof.

1.9   “ Confidential Information ” means any and all trade secrets, proprietary or confidential information of either party and includes, without limitation: (a) any information, software, material, data or business, financial, operational, customer, vendor, and other information disclosed by one party to the other, (b) the terms of this Agreement, and/or (c) the fact of the existence of this Agreement except as specifically permitted in Section   7 .   Confidential Information will not include information that the receiving party can prove:  (w) was already in such party’s possession prior to receipt; (x) was independently developed by such party; (y) was obtained from a third party who had the right to disclose such information to such party, and/or (z) was or became generally available to the public other than as a result of disclosure by such party.

1.10   “ Content ” means, collectively: (a) the Reference Content; (b) Translated Content; (c) any updates to any of the foregoing provided by World Book; and (d) World Book Derivatives. The term “Content” shall not include any HSWI Modifications.

1.11   “ Delivery Period ” means the following:

(i)         July 1, 2008 – December 30th, 2009

1.12   “ Display ” means to use, publicly display, publicly perform, provide a link to, provide the ability to download and/or print and otherwise make available on or through web sites.

1.13   “ Effective Date ” is defined in the preamble of this Agreement.

1.14   “ Encyclopedia ” means a tab or section of a website: (a) branded with the word “encyclopedia”; or (b) that consists solely of multiple unrelated Affinities as provided by World Book hereunder.

1.15   “ Excess Royalties ” is defined in Section 4.1(iii) hereof.

1.16   “ Exclusive ” shall mean World Book shall have no further right to grant to third parties the same or any other licenses to the Content in the Open Free Web and itself retains no such rights or other licenses.

1.17   “ Force Majeure Event ” is defined in Section 11.1 hereof.

1.18   “ HSWI Modifications ” means modifications to the Content made by or on behalf of HSWI or its Affiliates in accordance with this Agreement, except to the extent the HSWI Modifications are World Book Derivatives.

1.19   “ HSWI Websites ” means, collectively, the Chinese language website found at bowenwang.com.cn, and all other websites (be they Chinese language or non-Chinese language) owned or controlled by HSWI or its Affiliates whether presently existing or later developed, and all successor websites to any of the foregoing websites

1.20   “ Images ” means illustrative materials, including but not limited to charts, graphs, photographs, tables and renderings wholly owned by World Book and licensed to HSWI.

1.21   “ Intellectual Property Rights ” means any and all rights, titles and interests, whether foreign or domestic, in and to any and all trade secrets, patents, copyrights, service marks, trademarks, know-how, or similar intellectual property rights, as well as any and all moral rights, rights of droit moral, rights of privacy, publicity and similar rights of any type under the laws or regulations of any governmental, regulatory, or judicial authority, foreign or domestic.

1.22   “ Net Revenue ” means gross revenue less costs not to exceed [*] percent ([*]%) of such gross revenue, including reasonable third-party agency/ third-party advertising sales commissions and rebates and serving, bad debts and applicable taxes.

1.23   “ Open Free Web ” means all websites (i) through which content can be indexed by Google and/or other consumer search engines; (ii) through which content is openly accessible by the public free of charge, and/or (iii) that do not charge a subscription fee or other fee for access to the content of the website.

1.24   ” Reference Content ” means content created from various World Book digital databases, print products, outside reference sources or materials acquired by World Book and which shall be provided in simplified Chinese characters and shall consist of sixteen million (16,000,000) to [*] ([*]) Chinese characters.

1.25   “ Royalties ” means fees payable by HSWI to World Book and calculated on the basis set forth in Section 4.1 hereof.

1.26   “ Significant Breach ” means an uncured breach (pursuant to the cure provisions of Section 6.2(i) ) by HSWI of one or more of the following:

(i)       HSWI brands the Affinities with the word “Encyclopedia” and/or Displays the Affinities or the underlying Reference Content and/or Images as an Encyclopedia in breach of Section   2.2(iii) ;

(ii)       HSWI uses or Displays the World Book Brand to promote the Content in violation of Section 7.4 ;

(iii)        HSWI assigns this Agreement to a Competitor (as defined in Section 11.8 ) of World Book in violation of Section 11.8 ; and/or

(iv)        HSWI fails to make payments as required by Section 4 .

1.27   “ Translated Content ” means non-Chinese versions of the Affinities and/or the Reference Content, created pursuant to Section   2.3 .

[*] Confidential treatment requested; certain information omitted and filed separately with the SEC.

1.28   “ Updating Services ” means that upon World Book’s update to or maintenance of the World Book Online Reference Center or the Reference Content, World Book will provide notice, a reference to the affected Articles, and the actual content of the update to HSWI so that HSWI can update and maintain the factual data in the Affinities.  Such services shall be of the scope and nature with which World Book updates and maintains its content in the normal course of its own updating and maintenance process.

1.29   “ World Book Brand ” is defined in Section 7.4 hereof.

1.30   “ World Book Derivatives ” means any modifications, updates or other derivative works to the Content based on other Content provided by World Book regardless of who performs such modifications, updates or other derivative works.

1.31   “ World Book Online Reference Center ” means World Book’s online product found at www.worldbookonline.com or any successor URL thereto.

2.   LICENSE GRANT .

2.1   License Grant and Restrictions .

(i)   License Grant .  Subject to the terms and conditions set forth herein, World Book hereby grants to HSWI, a perpetual, irrevocable limited license to use, copy, store, archive, distribute, transmit, modify (subject to Section 2.1(iv) ), and Display the Content, Images and Affinities in whole or in part, only on the HSWI Websites or in promotions in any media for the HSWI Websites.  The license to each component of the Content, Images and Affinities shall be subject to the term and exclusivity provisions set forth in this Section 2 .  The license to each component of the Content, Images and Affinities shall be supplemented by any additional license rights in this Section 2 , and in the event of any conflict with this Section 2.1 such other additional license rights in this Section 2 shall prevail.  

(ii)   Right to Sublicense .  World Book further grants HSWI the right to sub-license the Content, Images and Affinities to users of the HSWI Websites to view, to store, and to make reasonable copies of the Content, Images and Affinities to use such Content, Images and Affinities for non-commercial, private purposes, provided that HSWI sets forth the limited terms of such sublicense in writing in the HSWI Websites’ terms and conditions.  In addition, World Book grants HSWI the right to sub-license the Content for business development purposes, with no more than [*] ([*]%) of the Content being licensed to any single third party, and in limited, non-material usage in other mediums for promotional or public relations purposes.  HSWI may not sublicense the Content, Images or Affinities to any paid-subscription website which is an aggregator of third-party content (for the avoidance of doubt, such shall not include the

HSWI Websites).  Notwithstanding anything to the contrary herein, attached as Attachment B is a list of companies (the “ Competitors II ”)   which are competitors with World Book and to whom sublicense may be made only with prior written consent of World Book, which World Book may withhold at its sole discretion.  The Competitors II may be modified from time to time by notice to and approval of the other party, not to be unreasonably withheld.  HSWI shall provide World Book on or before June 30th and December 31st of each year with a list of third parties to whom sublicense hereunder has been made during such semiannum.

(iii)   No Other Rights .  Except as set forth herein, HSWI has no other right to sublicense the Content except with the advance written consent of World Book.  World Book retains all rights not specifically granted herein.

(iv)   Restrictions .  The Content and Images shall be available to Display on the HSWI Websites as one or more individual articles, via commercially available browsers using personal computers, mobile devices, kiosks, or other equipment.  HSWI may modify the Content, including using excerpts, for purposes of exercising its rights under this Agreement, including without limitation, to fit the format and the look-and-feel of the HSWI Websites, for promotion of the Content or HSWI Websites, for allowing third parties to sponsor certain Content, and to include links in the Content to HSWI Websites or third party websites; provided, however, HSWI may not edit, modify, or create derivative works from the Content for purposes of changing the substantive information contained in the Content, except (i) as otherwise approved by World Book in writing; or (ii) as otherwise expressly provided in this Agreement.  HSWI may not Display the Content or Images on any website which is pornographic.  HSWI may not translate the Content provided by World Book hereunder except as set forth in Section 2.3 or for purposes of performing updates.

(v)   Third Party Service Provider Rights .  HSWI may permit third party suppliers of services and facilities (including, without limitation, agents, consultants, host providers, data centers, outsource service providers, disaster backup and recovery service providers) to use the Content, Images and Affinities under the terms of this Agreement in support of HSWI exercising its rights under this Agreement.  HSWI also may designate one or more third party suppliers of services as HSWI’s agent for the administration of this Agreement and the receipt of services under this Agreement from World Book.

(vi)   Affiliate Rights . All rights granted to HSWI under this Agreement may be exercised by or through HSWI and/or its Affiliates.

2.2   Affinities .

(i)   Creation .  World Book shall create and deliver the Affinities in the Delivery Period.  The Affinities will be organized into stand-alone articles around specific topics (each, an “ Article ”) according to the taxonomy set forth in Schedule A .  Any given Affinity will consist of multiple Articles in the same subject area (i.e., history or life sciences).  There shall be at least one Article for each of those topics identified in Schedule B .  World Book shall create the Affinities based on Reference Content and other content owned or licensed by World Book, including without limitation, various World Book digital databases, print products, outside reference sources or materials acquired by World Book.  World Book will make reasonable efforts to cross check the Reference Content against other World Book products for factual accuracy.  World Book will create the Affinities according to the guidelines and instructions provided by HSWI from time to time, and agreed to by World Book whose consent shall not be unreasonably withheld, and according to the high quality standards for commercially published works, but in no event less than the standards of World Book for its own