These Terms of Use ("Agreement") govern your access to and use of the website at www.smartyants.com (the "Site") provided by Smarty Ants, Inc. ("Smarty Ants," "we," or "us") and the Service (defined below). PLEASE READ THIS AGREEMENT CAREFULLY. BY ACCESSING OR USING THE SERVICE, YOU (ON BEHALF OF YOURSELF OR THE SCHOOL YOU REPRESENT) AGREE TO BE BOUND BY THIS AGREEMENT. IF YOU DO NOT WISH TO BE BOUND BY THIS AGREEMENT, YOU MAY NOT ACCESS OR USE THE SERVICE. YOU MAY NOT ACCEPT THIS AGREEMENT IF YOU ARE UNDER 18 YEARS OF AGE. IF YOU ARE A PARENT OR GUARDIAN OF A CHILD USING THE SERVICE, YOU AGREE TO BE BOUND BY THIS AGREEMENT WITH RESPECT TO SUCH CHILD'S USE OF THE SERVICE. IF YOU ARE A TEACHER USING THE SERVICE, YOU AGREE THAT YOU HAVE THE RIGHT AND AUTHORITY TO BIND THE SCHOOL TO THIS AGREEMENT. Certain features of the Service may be subject to additional guidelines, terms, or rules, which will be posted in connection with such features. All such additional guidelines, terms, and rules, are hereby incorporated by reference into this Agreement.

1. Services. Smarty Ants provides the following reading services ("Reading Services"): (a) the reading world service for schools ("School User") ("School User Service"), (b) the reading world service for parents of students who are receiving the School User Service ("School Parent User") ("Home Service"); and (c) the reading world service for parents ("Homeschooler Parent User") ("Homeschooler Service"). In addition to the Reading Services, Smarty Ants provides related applications for your personal computer or other device ("Licensed Application") and other services on the Site (collectively, "Services"). "Child User" means a student of the School User / child of the School Parent User or child of the Homeschooler Parent User who is using the Service. "User" means any user of the Site or Service, and may be a Child User, School User, School Parent User, or Homeschooler Parent User. To the extent you are a School User, the provisions in this Agreement regarding School Users apply to you. To the extent you are a School Parent User, the provisions in this Agreement regarding School Parent User apply to you. To the extent you are a Homeschooler Parent User, the provisions in this Agreement regarding Homeschooler Parent User apply to you. To the extent you are a User, the provisions in this Agreement regarding Users apply to you.

2. User Accounts. To use the Reading Service, you must create a user account ("Account") by registering through the Site, providing us with the information requested on the registration form, and accepting this Agreement. You will promptly update all Account information to keep it true, accurate, and complete. Should we suspect that any information you provide is not true, accurate, or complete, we have the right to suspend or terminate your use of the Service. When you register, we will ask you to provide a user name and password. You will be responsible for all activities that occur under your user name and password and, therefore, you agree to keep your password confidential. You agree to notify us immediately of any unauthorized use of your user name or password or if you believe that your password is no longer confidential. You will be responsible for any activities that occur under your Account (including any activities of your Child User) until you terminate your Account in accordance with Section 11. We reserve the right to require you to alter your user name and/or password if we believe that your Account is no longer secure. You will not: (a) provide any false personal information with respect to you or your Child User as part of your Account information or on the Service; (b) create an Account for anyone other than yourself; (c) create or use more than one Account at any given time; (d) transfer your Account to anyone else; (e) permit others (other than your Child User) to use your Account; or (f) use or access other persons' Accounts.

3. Fees & Payment.

3.1 License Fee School User Service. The current license fee for the School Service is: 1-99 Child Users, $30.00 per year per Child User; 100-249 Child Users, $27.50 per year per Child User; 250-499 Child Users, $25.00 per year per Child User; 500-999 Child Users, $22.50 per year per Child User; and 1000+ Child Users, $20 per year per Child User.

3.2 License Fee Home Service. The Home Service is provided free of charge.

3.3 License Fee Homeschooler Service. The current license fee for the Homeschooler Service is (1) $49.99 per year for the first Child User and $24.99 per year for each additional Child User or (2) $24.99 per 3 month period for the first Child User and $12.99 per 3 month period for each additional Child User.

3.4 Billing and Renewal. The initial charge will be equal to the current number of total Child Users times the applicable license fee. You are responsible for paying for all Child Users, whether or not the licenses are used. Added Child Users will be subject to the following: (a) added Child Users are coterminous with the then-current term; (b) the license fee for the added Child User will be the then-current, generally applicable license fee; and (c) a Child User added in the middle of a billing term will be charged a prorated amount for that term. The renewal charge will be equal to the then-current number of total Child Users times the then-current generally applicable license fee. Smarty Ants reserves the right to modify its fees and charges and to introduce new charges at any time, upon at least ninety (90) days prior notice to you, which notice may be provided by e-mail or to your Account; provided that the changes will not take place until your subscription renews. Your subscription automatically renews each three month period or year (depending on your subscription) until you cancel the subscription by following the instructions in your Account or emailing us at customerservice@smartyants.com with the subject line "CANCEL SUBSCRIPTION". Subscriptions are paid for in advance, all payment obligations are non- cancelable and all amounts paid are nonrefundable (even if you cancel a subscription prior to expiration of the then current-term). Smarty Ants will automatically bill your credit card submitted with the order form for all amounts due (in accordance with this Section 3) on the date you order the subscription and, and each three month period or year thereafter (depending on your subscription), until you cancel the subscription as described above. You hereby authorize Smarty Ants to bill your credit card as described above.

3.5 Other Payment Terms. Any amounts not paid when due shall bear interest at the rate of one and one half percent (1.5%) per month, or the maximum legal rate, if less. All payments must be made in U.S. dollars. Smarty Ants shall be entitled to withhold performance and discontinue Service until all amounts due are paid in full. Smarty Ants' fees are exclusive of all taxes, levies or duties imposed by taxing authorities, and you shall be responsible for payment of all such taxes, levies, or duties, excluding only United States taxes based solely on Smarty Ants' income. You agree to provide Smarty Ants with complete and accurate billing and contact information. You agree to update this information within thirty (30) days of any change to it. If the billing and/or contact information you have provided is false or fraudulent, Smarty Ants may terminate your access to the Service in addition to any other legal remedies.

3.6 Free Trial. Smarty Ants may, in its sole discretion, offer a free 30-day trial subscription. You may only participate in one such free trial by following the instructions on the Site. If you do not order a paid subscription prior to expiration of your trial subscription, then your subscription will expire, you may no longer use the Reading Service, and we may delete any User Content and Student Records associated with your subscription.

4. Certain School User Obligations

4.1 School User acknowledges receipt of Smarty Ants privacy policy describing Smarty Ants personal information collection, use, and disclosure practices.

4.2 FERPA. The Family Educational Rights and Privacy Act ("FERPA") protects the privacy of student educational records and limits when a school may disclose a student's educational records. School User is solely responsible for its compliance with FERPA. Without limiting the generality of the foregoing, School User represents and warrants that for all student records disclosed by School User ("Student Records"), School User has obtained the appropriate consent from the parents of Child Users, or from the students if such students are 18 and older, as required under FERPA to make such disclosure and grant the following license.

4.3 COPPA. School User represents and warrants that it has or will provide notice to and obtain consent of parents of Child Users allowing Smarty Ants to collect information from such Child Users in compliance with the Children's OPPA.

4.4 License from School User. School User grants to Smarty Ants a nonexclusive license to view, download, reproduce, modify, create derivative works of, distribute, and display Student Records of a Child User solely for the purposes of (a) providing the School Service to the School User, (b) providing the Home Service to the Child User and School Parent User, and (c) to use anonymized Student Records to improve the Service.

5. User Content

5.1 Content License. By posting or submitting content to the Service, including messages, comments, and other content (or permitting your Child User to do the same) (but excluding Student Records) ("User Content"), you hereby grant to Smarty Ants an irrevocable, perpetual, non-exclusive, royalty-free and fully paid, worldwide, transferable license, with the right to sublicense through multiple tiers, to reproduce, distribute, modify, publicly display, publicly perform, prepare derivative works of, transmit, and otherwise use such User Content, in any format or medium now known or developed in the future, in connection with the Service. You represent and warrant that: (a) you have the right to grant the foregoing license and to post the User Content; (b) the User Content will not infringe, misappropriate, violate or contravene any third party rights (including any intellectual property rights); and (c) the User Content is accurate. You are solely responsible for the User Content that you post on the Service.

5.2 User Guidelines. You agree to comply with the guidelines listed below and any other user guidelines posted on the Service. Smarty Ants reserves the right (but is not obligated) to investigate and to take appropriate legal action in its sole discretion for any violation of this provision or this Agreement or any conduct or content that is offensive, illegal, or violates the rights of, harms, or threatens the safety of, other users or third parties, including removing such content from the Service, notifying the appropriate authorities regarding and identifying the source of such content, barring violators from accessing the Service, and terminating the Accounts of such violators. Without limiting the foregoing:

(a) You will comply with all applicable laws, including privacy laws, intellectual property laws, and regulatory requirements;

(b) You have authority to consent to Smarty Ants' collection and use of personal information from the Child Users to allow Smarty Ants to provide, maintain and improve the Services.

(c) You will not post inappropriate, inaccurate, or objectionable content to the Service.

(d) You will not bully, harass, or advocate harassment of another user or person;

(e) You will not solicit passwords or personal identifying information of any kind for commercial or unlawful purposes from other users, or engage in commercial activities and/or sales such as contests, sweepstakes, barter, advertising, and pyramid schemes;

(f) You will not post content that contains "junk mail" or "chain letters";

(g) You will not post content that is obscene or that promotes racism, bigotry, hatred, or physical harm of any kind against any group or individual;

(h) You will not post or upload any virus, time bomb, worm, corrupted file, or other software routine capable of disrupting, disabling, or harming the operation of, or providing unauthorized access to the Service;

(i) You will not use the Service to do or promote anything that is unlawful, illegal, misleading, defamatory, or libelous; and

(j) You will not promote, upload, or post anything that contains an illegal and/or unauthorized copy of another person's copyrighted work (whether marked as such or not).

6. License

6.1 Site. During the term of this Agreement and subject to the terms of this Agreement, Smarty Ants grants to you a nontransferable, nonexclusive license during the term of this Agreement (without the right to sublicense) to access and use the Site, solely for your personal, non-commercial purposes, and for no other use.

6.2 Reading Service. During the term of your subscription and subject to the terms of this Agreement, Smarty Ants grants to you a nontransferable, nonexclusive license during the term of this Agreement (without the right to sublicense) to access and use the Reading Service, solely for your personal, non-commercial purposes, and for no other use.

6.3 Licensed Application. During the term of your subscription and subject to the terms of this Agreement, Smarty Ants grants to you a nontransferable, nonexclusive license during the term of this Agreement (without the right to sublicense) to install and execute one copy of the Licensed Application, in executable object code format only, solely (a) on a personal computer or other device that you own or control and (b) for your use of the Service for your personal, non-commercial purposes, and for no other use.

6.4 Child User/Child User. During the term of your subscription and subject to the terms of this Agreement, you may permit each child you have paid the applicable License Fee for ("Child User") to use the Reading Service and Licensed Application as licensed above, under your supervision. You are solely responsible for any use by your Child User.

6.5 Restrictions. You acknowledge that the structure, organization, and source code of the Licensed Application constitute valuable trade secrets of Smarty Ants and its licensors. Accordingly, you shall not: (a) license, sell, rent, lease, transfer, assign, distribute, host, outsource, disclose, or otherwise commercially exploit the Service (including the Licensed Application) or make the Service (including the Licensed Application) available to any third party; (b) modify, adapt, alter, translate, make derivative works of, disassemble, reverse compile, or reverse engineer any part of the Service (including the Licensed Application); (c) merge the Service (including the Licensed Application) with other software; (d) access the Service (including the Licensed Application) in order to build a similar or competitive product or service; and (e) copy, reproduce, distribute, republish, post, or transmit any part of the Service (including the Licensed Application) in any form or by any means, including but not limited to electronic, mechanical, photocopying, recording, or other means. Any future release, update, or other addition to functionality of the Service (including the Licensed Application) provided by Smarty Ants (if any) shall be subject to the terms of this Agreement unless Smarty Ants expressly states otherwise. You shall preserve all copyright and other proprietary rights notices on the Service (including the Licensed Application) and all copies thereof.

7. Ownership. Smarty Ants and its licensors own the Service, all content (except for your User Content and Student Records) contained therein, and the Licensed Application, and all intellectual property rights relating to the foregoing. Smarty Ants and its licensors reserve all rights not expressly granted under this Agreement. Smarty Ants will treat any feedback or suggestions you provide to it as non-confidential and non-proprietary. Smarty Ants reserves the right to use any feedback or suggestions you provide in any manner and for any purpose without any obligation to compensate you.

8. Interaction with other Users. You are solely responsible for your interactions with other users of the Service. Smarty Ants reserves the right, but has no obligation, to monitor, or take any action Smarty Ants deems appropriate regarding, disputes between you and other users. To the extent permitted under applicable laws, you hereby release Smarty Ants from any and all claims or liability related to: (a) any User Content or Student Records posted on the Service; or (b) the conduct, whether online or offline, of any other user.

You hereby waive California Civil Code Section 1542 (and any similar provision in any other jurisdiction) which states: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which, if known by him must have materially affected his settlement with the debtor."

9. Third Party Websites and Services. Our Service may contain links to Internet sites and services maintained by third parties. These links are provided for your reference only. We do not control, operate or endorse in any respect information, products, or services on such third-party sites and are not responsible for their content. Many third-party sites and services have their own terms of use and privacy policies that differ from ours. This Agreement only applies to our Service and does not apply to any other site or service.

10. Availability and Modification of Service. Smarty Ants reserves the right, from time to time, to suspend the Service or any part thereof with or without notice for maintenance, repair, updates, and upgrades relating to the Service or to protect against harm or liability to the Service or Smarty Ants. Smarty Ants will have the right to modify or discontinue, from time to time, any aspect of the Service. You agree that Smarty Ants will not be liable to you or to any third party for any modification, discontinuance, or suspension of the Service or any part thereof.

11. Term and Termination. Subject to this Section, this Agreement will remain in full force and effect while you use the Service and/or maintain an Account. You may terminate your subscription at any time and for any reason as described in Section 3. Smarty Ants will have the right to terminate this Agreement, your subscription, and/or your Account, or suspend or terminate your access to the Service, for any breach of this Agreement immediately upon notice to your e-mail address listed in your Account. Smarty Ants may terminate this Agreement, your subscription, and/or your Account for any reason or no reason immediately upon notice to your e-mail address listed in your Account, upon which Smarty Ants will refund a prorated amount of any prepaid license fees. Upon termination of this Agreement, your subscription, or your Account, by either party, your right to access and use the Service will terminate immediately. You understand that any such termination may involve deletion of your User Content and Student Records associated therewith from our live databases. You agree that we will have no liability to you for any costs, expenses, losses, damages, or liabilities arising out of or related to such termination. Even after this Agreement is terminated, the following provisions of this Agreement will remain in effect: Sections 4, 5, 6.5, and 7- 21.

12. Warranty Disclaimer. TO THE EXTENT PERMITTED UNDER APPLICABLE LAWS, SMARTY ANTS PROVIDES THE SERVICE (INCLUDING THE LICENSED APPLICATION) "AS-IS" AND AS AVAILABLE AND EXPRESSLY DISCLAIMS ALL WARRANTIES AND CONDITIONS OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE WARRANTIES OR CONDITIONS OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, QUIET ENJOYMENT, ACCURACY, AND NON- INFRINGEMENT. SMARTY ANTS DOES NOT GUARANTEE AND DOES NOT PROMISE ANY SPECIFIC RESULTS FROM THE USE OF THE SERVICE (INCLUDING THE LICENSED APPLICATION). SMARTY ANTS MAKES NO WARRANTY THAT THE SERVICE (INCLUDING THE LICENSED APPLICATION) WILL BE UNINTERRUPTED, FREE OF VIRUSES OR OTHER HARMFUL CODE, TIMELY, SECURE, OR ERROR-FREE. YOU AGREE THAT SMARTY ANTS IS NOT RESPONSIBLE FOR THE TIMELINESS, DELETION, MIS-DELIVERY, OR FAILURE TO STORE OR SECURE ANY USER CONTENT OR STUDENT RECORDS, COMMUNICATIONS, OR PERSONALIZATION OR PREFERENCE SETTINGS. SMARTY ANTS DOES NOT ASSUME ANY“ OBLIGATION TO MONITOR ACTIVITIES CONDUCTED ON THE SERVICE.

SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES, SO THE ABOVE EXCLUSION MAY NOT APPLY TO YOU.

13. Limitation of Liability. TO THE EXTENT PERMITTED UNDER APPLICABLE LAWS, SMARTY ANTS WILL NOT BE LIABLE TO YOU, OR ANY THIRD PARTY, FOR ANY LOST PROFITS, INDIRECT, CONSEQUENTIAL, EXEMPLARY, INCIDENTAL, SPECIAL, OR PUNITIVE DAMAGES ARISING FROM OR RELATING TO YOUR USE OF THE SERVICE (INCLUDING THE LICENSED APPLICATION) UNDER THIS AGREEMENT, EVEN IF SMARTY ANTS HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, SMARTY ANTS' LIABILITY TO YOU FOR ANY CAUSE WHATSOEVER, AND REGARDLESS OF THE FORM OF THE ACTION, WILL AT ALL TIMES BE LIMITED TO THE GREATER OF FIFTY U.S. DOLLARS (US $50) OR THE AMOUNTS PAID BY YOU TO SMARTY ANTS IN THE TWELVE (12) MONTHS PRECEDING THE CLAIM. THE EXISTENCE OF ONE OR MORE CLAIMS WILL NOT SERVE TO ENLARGE THIS LIMIT. YOU ACKNOWLEDGE AND AGREE THAT THESE LIMITATIONS OF LIABILITY ARE ESSENTIAL AND FUNDAMENTAL PARTS OF THIS AGREEMENT WHICH ARE NECESSARY TO INDUCE SMARTY ANTS TO ENTER INTO THIS AGREEMENT.

SOME JURISDICTIONS DO NOT ALLOW THE LIMITATION OR EXCLUSION OF LIABILITY FOR INCIDENTAL OF CONSEQUENTIAL DAMAGES, SO THE ABOVE LIMITATION OR EXCLUSION MAY NOT APPLY TO YOU.

14. User Indemnification. You agree to indemnify and hold Smarty Ants, its subsidiaries, affiliates, directors, officers, agents, and employees harmless from any losses, damages, liabilities, claims, demands, costs, or expenses, including reasonable attorneys' fees, arising out of or relating to your (or your Child User's): (a) User Content and Student Records; (b) use of the Service; (c) breach of this Agreement; (d)“ breach or inaccuracy of any representation or warranty made under this Agreement; or (e) violation of applicable laws or the rights of third parties.

15. Copyright Policy. You may not post, distribute, or reproduce in any way any Smarty Ants copyrighted material, trademarks, or other proprietary information unless you have the right to do so. We have adopted and implemented a policy that provides for the removal of any infringing materials and for the termination, in appropriate circumstances, of users of our online Services who are repeat infringers of intellectual property rights, including copyrights. If you believe that your work has been copied and posted on the Service in a way that constitutes copyright infringement, please follow the requirements for appropriate notifications under the Digital Millennium Copyright Act (DMCA), 17 U.S.C. § 512. At a minimum, you must provide our Copyright Agent with the following information: an electronic or physical signature of the person authorized to act on behalf of the owner of the copyright interest; a description of the copyrighted work that you claim has been infringed; an identification of the location on the Service of the material that you claim is infringing; your address, telephone number, and email address; a written statement by you that you have a good faith belief that the disputed use is not authorized by the copyright owner, its agent, or the law; and a statement by you, made under penalty of perjury, that the above information in your notice is accurate and that you are the copyright owner or authorized to act on the copyright owner's behalf. Smarty Ants' Copyright Agent for notice of claims of copyright infringement can be reached by writing the following:

www.smartyants.com/customer-support

16. Disclosures. Smarty Ants is located at 4040 Civic Center Drive San Rafael, CA 94903. If you are a California resident, you may report complaints to the Complaint Assistance Unit of the Division of Consumer Services of the California Department of Consumer Affairs by contacting them in writing at 400 R Street, Sacramento, CA 95814, or by telephone at (800) 952-5210.

17. Electronic Communications. The communications between you and Smarty Ants use electronic means, whether you use the Service or send us emails, or whether Smarty Ants posts notices on the Service or communicates with you via email. For contractual purposes, you (a) consent to receive communications from Smarty Ants in an electronic form; and (b) agree that all terms and conditions, agreements, notices, disclosures, and other communications that Smarty Ants provides to you electronically satisfy any legal requirement that such communications would satisfy if it were be in a hardcopy writing. The foregoing does not affect your non-waivable rights.

18. Dispute Resolution. This Agreement, and any claim, dispute, or controversy of whatever nature arising out of or relating to this Agreement, will be governed by the laws of California, without giving effect to any conflicts of laws principles that require the application of the laws of a different jurisdiction. Any action or proceeding arising from or relating to this Agreement must be brought in a federal or state court located in San Francisco, California and each party irrevocably submits to the jurisdiction and venue of any such court in any such action or proceeding, except that a party bringing an action may choose to resolve the dispute through binding non-appearance-based arbitration in accordance with the following: (a) the arbitration will be provided through a nationally-recognized alternative dispute resolution provider mutually agreed upon by the parties; (b) the arbitration will be conducted in one or more of the following manners at the option of the party initiating arbitration: telephone, online, or written submissions; (c) the arbitration will not involve any personal appearances by the parties or witnesses unless otherwise agreed by the parties; and (d) any judgment on the award rendered by the arbitrator may be entered in any court of competent jurisdiction. Notwithstanding the foregoing, either party may seek injunctive relief in any court having jurisdiction to protect its intellectual property or confidential or proprietary information.

19. General. If any provision of this Agreement is unenforceable, such provision will be changed and interpreted to accomplish the objectives of such provision to the greatest extent possible under applicable law and the remaining provisions will continue in full force and effect. All waivers must be in writing. Any waiver or failure to enforce any provision of this Agreement on one occasion will not be deemed a waiver of any other provision or of such provision on any other occasion. You acknowledge that the Service (including the Licensed Application) contain valuable trade secrets and proprietary information of Smarty Ants, that any actual or threatened breach of Section 6 (License) or Section 7 (Ownership) of this Agreement will constitute immediate, irreparable harm to Smarty Ants for which monetary damages would be an inadequate remedy, and that injunctive relief is an appropriate remedy for such breach. The headings of Sections of this Agreement are for convenience and are not to be used in interpreting this Agreement. Unless the context clearly requires otherwise, "includes" and "including" are not limiting. This Agreement constitutes the final, complete, and exclusive agreement between the parties regarding the subject hereof and supersedes all prior or contemporaneous agreements, understandings, and communication, whether written or oral.

20. Changes. This Agreement is subject to occasional revision. If we make any material changes to this Agreement, we will make appropriate notices, including posting notice of the changes on the Site. Except for such amendments, no amendment to this Agreement will be valid unless in a writing hand- signed by the parties.

21. Trademark and Copyright Notice. Certain names, slogans, graphics, logos, service marks, and trade names used on the Service are the trademarks of Smarty Ants and may not be used without our permission. Other trademarks, service marks, and trade names that may appear on the Service are the property of their respective owners. Copyright © 2012, Smarty Ants, Inc. All rights reserved.

This Agreement was last revised August 24th, 2012.