Common use of Depreciation and Amortization Clause in Contracts

Depreciation and Amortization. 3,197 3,369 Provision for student loan losses ...................................... (63) (70) Deferred income taxes .................................................. (33) (1,605) Stock-based compensation ............................................... -- 3,028 Changes in assets and liabilities: Tuition receivable, net ................................................ (4,894) (5,086) Other current assets ................................................... (751) (4,217) Other assets ........................................................... -- (3) Accounts payable ....................................................... 1,618 5,197 Accrued expenses ....................................................... (956) 301 Income taxes payable ................................................... (6,906) (1,816) Excess tax benefits from stock-based payment arrangements .............. -- (1,787) Unearned tuition ....................................................... 5,572 3,358 Deferred lease incentives .............................................. 1,531 -- Student loans originated ................................................. (571) (3) Collections on student loans receivable and held for sale ................ 601 23 ------------ ------------ Net cash provided by operating activities .............................. 25,035 30,747 ------------ ------------ Cash flows from investing activities: Purchases of property and equipment ...................................... (7,793) (6,074) Purchases of marketable securities ....................................... -- (30,000) ------------ ------------ Net cash used in investing activities .................................. (7,793) (36,074) ------------ ------------ Cash flows from financing activities: Common dividends paid .................................................... (3,647) (7,203) Proceeds from exercise of stock options .................................. -- 3,249 Excess tax benefits from stock-based payment arrangements ................ -- 1,787 Repurchase of common stock ............................................... (24,998) (19,555) ------------ ------------ Net cash used in financing activities .................................. (28,645) (21,722) ------------ ------------ Net increase (decrease) in cash and cash equivalents ................... (11,403) (27,049) Cash and cash equivalents - beginning of period ............................ 97,004 74,212 ------------ ------------ Cash and cash equivalents - end of period .................................. $ 85,601 $ 47,163 ============ ============

Depreciation and Amortization. 3,197 3,369 Provision for student loan 174,931 191,737 244,599 Equity in losses ...................................... of Digital River................................. 1,829,207 1,356,370 -- Gain on sale of securities........................................ (633,780,872) (7026,646) Deferred income taxes .................................................. -- Minority interest in Digital River................................ -- -- (33275,634) (1,605) Stock-based compensation ............................................... Loss on mining assets............................................. 538,276 -- 3,028 Changes -- Change in operating assets and liabilities: Tuition Trade accounts receivable, net ....................................... (660,024) 151,317 (573,104) Inventories..................................................... 106,575 16,066 1,612,822 Prepaids and other current assets............................... (181,730) 110,787 173,297 Accounts payable................................................ 2,191,490 (4,8941,457,016) (5,086511,199) Accrued compensation and benefits............................... (34,592) 52,098 44,804 Other current assets ................................................... accrued expenses.......................................... 730,033 280,090 (75132,865) (4,217) Other assets ........................................................... -- (3) Accounts payable ....................................................... 1,618 5,197 Accrued expenses ....................................................... (956) 301 Income taxes payable ................................................... (6,906) (1,816) Excess tax benefits from stock-based payment arrangements .............. -- (1,787) Unearned tuition ....................................................... 5,572 3,358 Deferred lease incentives .............................................. 1,531 -- Student loans originated ................................................. (571) (3) Collections on student loans receivable and held for sale ................ 601 23 ------------ ------------ ------------- ----------- Net cash provided by (used in) operating activities .............................. 25,035 30,747 activities........... 377,616 (337,787) 66,325 ------------ ------------ Cash flows from investing activities------------- ----------- Investing Activities: Purchases Change in restricted cash........................................... (85,843) (143,623) -- Purchase of property and equipment ...................................... equipment.................................. (7,793345,012) (6,074168,016) Purchases of marketable securities ....................................... (244,047) Patents and organization costs...................................... -- -- (30,000) ------------ ------------ Net cash used in investing activities .................................. (7,793) (36,074) ------------ ------------ Cash flows from financing activities: Common dividends paid .................................................... (3,647) (7,20327,964) Proceeds from exercise sale of stock options .................................. securities.................................... 4,709,272 272,646 -- 3,249 Excess tax benefits Proceeds from stock-based payment arrangements ................ sale of mining assets................................. 20,000 -- 1,787 Repurchase -- Decrease in cash due to deconsolidation of Digital River............ - (799,721) -- Change in officer/stockholder receivable............................ 201,512 -- 4,288 ------------ ------------- ----------- Net cash provided by (used in) investing activities............... 4,499,929 (838,714) (267,723) ------------ ------------- ----------- Financing Activities: Net borrowings (payments) on revolving line of credit............... (758,333) 486,363 (377,277) Issuance of common stock ............................................... stock, net....................................... 516,764 -- -- Stock repurchase.................................................... -- -- (24,99837,500) Dividends paid...................................................... (200,000) (19,555208,120) (200,730) Proceeds from issuance of Digital River long-term debt, net......... -- -- 848,093 ------------ ------------ ------------- ----------- Net cash provided by (used in in) financing activities .................................. activities............... (28,645441,569) (21,722) 278,243 232,586 ------------ ------------ Net increase ------------- ----------- Increase (decrease) in cash and cash equivalents ................... equivalents...................... 4,435,976 (11,403898,258) (27,049) 31,188 Cash and cash equivalents - equivalents, beginning of period ............................ 97,004 74,212 year.......................... 300 898,558 867,370 ------------ ------------ ------------- ----------- Cash and cash equivalents - equivalents, end of period .................................. year................................ $ 85,601 4,436,276 $ 47,163 ============ ============300 $ 898,558 ------------ ------------- ----------- ------------ ------------- ----------- Supplemental cash flow information: Cash paid for interest.............................................. $ 112,770 $ 93,970 $ 50,375 Cash paid for income taxes.......................................... -- -- -- Noncash Financing Activities: Dividends accrued................................................... 31,045 19,200 35,000 Noncash repurchase of shares........................................ -- -- 178,485 Stock subscription receivable....................................... 284,000 -- -- Decrease in various accounts upon deconsolidation of Digital River: Prepaids and other current assets................................... -- (8,934) -- Property and equipment.............................................. -- (106,617) -- Debt issuance costs................................................. -- (147,413) -- Patents and organization costs...................................... -- (133,488) -- Convertible debentures.............................................. -- (998,750) -- Accounts payable.................................................... -- (142,445) -- Other accrued liabilities........................................... -- (93,621) -- The accompanying notes are an integral part of these consolidated financial statements. XXXX XXXXXXX INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 1998 AND 1997

Depreciation and Amortization. 3,197 3,369 4,525,855 4,970,237 4,935,239 Provision for student loan losses ...................................... store closures....... 8,947,059 -- 5,997,805 Gain on asset disposal............. (632,758,326) (70) Deferred income taxes .................................................. (33) (1,605) Stock-based compensation ............................................... -- 3,028 -- Changes in assets and liabilities: Tuition receivable, net ................................................ Inventories...................... 505,381 321,766 (4,8941,778,321) Prepaid expenses and other current assets.................. 586,987 (422,573) (5,086) Other current assets ................................................... (751) (4,217) Other assets ........................................................... -- (3295,744) Accounts payable ....................................................... 1,618 5,197 Accrued expenses ....................................................... and accrued expenses........................ (956) 301 Income taxes payable ................................................... (6,9061,382,847) (1,8163,467,011) Excess tax benefits from stock-based payment arrangements .............. -- 1,822,647 Other assets and liabilities..... 6,682,266 (1,7876,385,472) Unearned tuition ....................................................... 5,572 3,358 Deferred lease incentives .............................................. 1,531 -- Student loans originated ................................................. (571) (3) Collections on student loans receivable and held for sale ................ 601 23 988,801 ------------ ------------ Net cash provided by operating activities .............................. 25,035 30,747 ------------ ------------ Cash flows from investing activities: Purchases of property and equipment ...................................... (7,793) (6,074) Purchases of marketable securities ....................................... -- (30,000) ------------ ------------ Net cash used in investing activities .................................. operating activities.................... (7,79316,521,963) (36,07426,156,563) (17,700,648) ------------ ------------ ------------ Cash flows Flows from financing activitiesInvesting Activities: Common dividends paid .................................................... Purchase of property, equipment and other related assets.............. (3,6478,379,970) (7,203958,662) (28,625,888) Proceeds from exercise sale of stock options .................................. -- 3,249 Excess tax benefits from stock-based payment arrangements ................ -- 1,787 Repurchase of common stock ............................................... (24,998) (19,555) assets....... 4,639,412 11,770,062 7,323,186 ------------ ------------ ------------ Net cash from (used in financing activities .................................. in) investing activities.......... (28,6453,740,558) 10,811,400 (21,72221,302,702) ------------ ------------ ------------ Cash Flows from Financing Activities: Proceeds from equity issuances..... 3,324,837 13,278,013 9,953,819 Redemption of equity............... -- (517,000) (769,998) Dividends.......................... (826,556) -- (176,654) Proceeds from convertible debt..... 79,274,427 103,103,918 73,299,131 Repayments of convertible debt..... (63,052,340) (99,847,647) (45,031,555) ------------ ------------ ------------ Net increase cash from financing activities.................... 18,720,368 16,017,284 37,274,743 ------------ ------------ ------------ Increase (decreaseDecrease) in cash and cash equivalents ................... Cash.......... (11,4031,542,153) 672,121 (27,0491,728,607) Cash and cash equivalents - Cash, beginning of period ............................ 97,004 74,212 year............ 1,664,778 992,657 2,721,264 ------------ ------------ Cash and cash equivalents - ------------ Cash, end of period .................................. year.................. $ 85,601 122,625 $ 47,163 1,664,778 $ 992,657 ============ ============ ============ Supplemental Disclosure of Cash Flow Information: Interest paid.................... $ 8,102,497 $ 7,694,152 $ 5,636,719 ============ ============ ============ Supplemental Disclosure of Non-cash Activities: Distribution of warrants......... $ 1,624,184 $ -- $ -- ============ ============ ============ The accompanying notes to financial statements are an integral part of these statements. F-22

Depreciation and Amortization. 3,197 3,369 Provision for student loan 174,931 191,737 244,599 Equity in losses ...................................... of Digital River..................... 1,829,207 1,356,370 -- Gain on sale of securities............................ (633,780,872) (7026,646) Deferred income taxes .................................................. -- Minority interest in Digital River.................... -- -- (33275,634) (1,605) Stock-based compensation ............................................... Loss on mining assets................................. 538,276 -- 3,028 Changes -- Change in operating assets and liabilities: Tuition Trade accounts receivable, net ................................................ ........................... (4,894660,024) 151,317 (573,104) Inventories......................................... 106,575 16,066 1,612,822 Prepaids and other current assets................... (181,730) 110,787 173,297 Accounts payable.................................... 2,191,490 (1,457,016) (5,086511,199) Accrued compensation and benefits................... (34,592) 52,098 44,804 Other current assets ................................................... accrued expenses.............................. 730,033 280,090 (75132,865) (4,217) Other assets ........................................................... -- (3) Accounts payable ....................................................... 1,618 5,197 Accrued expenses ....................................................... (956) 301 Income taxes payable ................................................... (6,906) (1,816) Excess tax benefits from stock-based payment arrangements .............. -- (1,787) Unearned tuition ....................................................... 5,572 3,358 Deferred lease incentives .............................................. 1,531 -- Student loans originated ................................................. (571) (3) Collections on student loans receivable and held for sale ................ 601 23 ----------- ------------ ------------ ---------- Net cash provided by (used in) operating activities .............................. 25,035 30,747 activities...................................... 377,616 (337,787) 66,325 ----------- ------------ ------------ Cash flows from investing activities---------- Investing Activities: Purchases Change in restricted cash............................... (85,843) (143,623) -- Purchase of property and equipment ...................................... equipment...................... (7,793345,012) (6,074168,016) Purchases of marketable securities ....................................... (244,047) Patents and organization costs.......................... -- -- (30,000) ------------ ------------ Net cash used in investing activities .................................. (7,793) (36,074) ------------ ------------ Cash flows from financing activities: Common dividends paid .................................................... (3,647) (7,20327,964) Proceeds from exercise sale of stock options .................................. securities........................ 4,709,272 272,646 -- 3,249 Excess tax benefits Proceeds from stock-based payment arrangements sale of mining assets..................... 20,000 -- -- Decrease in cash due to deconsolidation of Digital River................................................. - (799,721) -- Change in officer/stockholder receivable................ 201,512 -- 1,787 Repurchase 4,288 ----------- ------------ ---------- Net cash provided by (used in) investing activities... 4,499,929 (838,714) (267,723) ----------- ------------ ---------- Financing Activities: Net borrowings (payments) on revolving line of credit... (758,333) 486,363 (377,277) Issuance of common stock ............................................... stock, net........................... 516,764 -- -- Stock repurchase........................................ -- -- (24,99837,500) Dividends paid.......................................... (200,000) (19,555208,120) (200,730) Proceeds from issuance of Digital River long-term debt, net................................................... -- -- 848,093 ----------- ------------ ------------ ---------- Net cash provided by (used in in) financing activities .................................. activities... (28,645441,569) (21,722) 278,243 232,586 ----------- ------------ ------------ Net increase ---------- Increase (decrease) in cash and cash equivalents ................... equivalents.......... 4,435,976 (11,403898,258) (27,049) 31,188 Cash and cash equivalents - equivalents, beginning of period ............................ 97,004 74,212 year.............. 300 898,558 867,370 ----------- ------------ ------------ ---------- Cash and cash equivalents - equivalents, end of period .................................. year.................... $ 85,601 4,436,276 $ 47,163 =300 $ 898,558 =========== ============ ========== Supplemental cash flow information: Cash paid for interest.................................. $ 112,770 $ 93,970 $ 50,375 Cash paid for income taxes.............................. -- -- -- Noncash Financing Activities: Dividends accrued....................................... 31,045 19,200 35,000 Noncash repurchase of shares............................ -- -- 178,485 Stock subscription receivable........................... 284,000 -- -- Decrease in various accounts upon deconsolidation of Digital River: Prepaids and other current assets....................... -- (8,934) -- Property and equipment.................................. -- (106,617) -- Debt issuance costs..................................... -- (147,413) -- Patents and organization costs.......................... -- (133,488) -- Convertible debentures.................................. -- (998,750) -- Accounts payable........................................ -- (142,445) -- Other accrued liabilities............................... -- (93,621) -- The accompanying notes are an integral part of these consolidated financial statements. XXXX XXXXXXX INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 1998 AND 1997