Notice regarding the agreement with a sponsor in accordance with the company's corporate rehabilitation proceedings

November 6, 2007

Below are the details regarding the agreement reached with G.education regarding their business sponsorship of Nova.

1. Background

On Friday October 26, 2007 the company applied for the commencement of corporate reorganization proceedings to the Osaka district court and an order to preserve assets was issued on the same date. The Osaka district court appointed the lawyers Toshiaki Higashibata and Noriaki Takahashi as interim trustees and, from the day of the court order, operations at Nova branches were suspended. Following this, an agreement has been reached with G.education Co., Ltd. to act as the new sponsor.

2. Content

(1) Business succession: "Ekimae Ryugaku" enterprise, "Ochanoma Ryugaku" enterprise, "NOVA KIDS" enterprise
(2) Acquiring company: G.education Co., Ltd. (100% subsidiary company of G.communication)
(3) Trademark: G.education operates English conversation schools named 'EC Eikaiwa', with 42 schools mainly in the Hokkaido area, and holds the trademark for this. Therefore, continued use of the 'Nova' trademark will be considered and decided later.
(4) Schools to be taken over: Aiming to maintain the employment of the employees and to support the students, to begin with we will immediately transfer 30 Nova schools to the sponsor and re-start lessons. After this, best efforts will be made to set up as many as 200 schools as an initial objective.
(5) Favorable treatment to Nova Students: Regarding the tuition that Nova students have paid in advance, this debt will not be taken over, but best efforts will be made to support the students. Initially, Nova students will be offered the same study content at 25% of the regular price.
(6) Security of employment: Regarding the employment of all Nova employees, including those in subsidiary companies (including foreign instructors and foreign staff), this will be given the best consideration and in principle the new sponsor will hire those employees who wish to be hired by them. We will set up a briefing session for employees soon. Please wait until we make a further announcement.

3. Future plans

We will continue to make announcements regarding future plans and schedules as soon as further details have been decided.