Document:

Exhibit 10.8

 

LICENSE
AND SERVICES AGREEMENT

 

 

This
License and Services Agreement (this “Agreement”), is made and entered into as of this 1st day of March, 2019
(the “Effective Date”), by and between Clip Interactive, LLC, a Colorado limited liability company, (“Clip”)
and XXXXX.

 

RECITALS:

 

A.         
Clip is in the business of providing certain technology and marketing services (“Hosted Application Services”)
related to the development, execution, commercialization and optimization of interactive applications and web players that interact
with radio programming to provide certain enhanced content and information generated from Clip’s proprietary audio monitoring
and digital conversion technology (“Enhanced Content”);

 

B.           
XXXXXX is in the business of owning and operating radio stations (collectively, the “XXXXX Stations”),
through which XXXXX sells products, advertising space, or other services, or otherwise generates and receives certain advertising
revenue (“Ad Revenue”);

 

C.            XXXXX is responsible for securing
and coordinating Hosted Application Services for its Affiliate, Reach Media, (the “Reach Media”);

 

D.           
XXXXX desires to engage Clip to provide those Hosted Application Services and develop and maintain those Clip Apps as set
forth on Exhibit A, attached hereto and incorporated herein, in order to increase Ad Revenue, in accordance with the terms
and conditions set forth in this Agreement;

 

E.           
The Hosted Application Services shall be provided to Reach Media, Inc., an XXXXX Affiliate, in order that Reach Media’s
syndicated programming is provided as Enhanced Content via the Reach Syndicated Program Applications as set forth on Exhibit A
(the “Reach Syndicated Programing Applications”). Reach Media. Reach Media

 

F.           
As of the Effective Date set forth above, the License and Service Agreement previously entered into by XXXXX and Clip with
an effective date of March 4th, 2017 (the “Prior Agreement”) shall be superseded by this Agreement and shall have no
force or effect going forward.

 

AGREEMENT:

 

NOW, THEREFORE, the parties agree:

 

1.            
DEFINED TERMS. Capitalized terms
and phrases used in this Agreement shall have the meanings set forth below. Additional terms may be defined throughout this Agreement
and in the Exhibits hereto.

 

“Advertiser
Campaigns” means any revenue generating advertiser or sponsorship campaign that utilizes the Clip Apps and web players
as part of their broadcast or digital execution. These include revenue generating Clip enabled broadcast ads, streaming audio ads,
sponsorships, digital only ads, promotions or contests that are generating revenues for XXXXX stations and the Reach Media.

 

“Reach
Media” means an affiliated entity of XXXXX, Inc. that is permitted to access the Services hereunder.

 

 

 

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"Enhanced
Content" means all content created by or originating from XXXXX stations and adapted or modified for use, distribution
or display with Clip Apps utilized by XXXXX.

 

“Affiliate”
means, with respect to a party, any person or entity directly controlling, controlled by or under common control with, such party.

 

“Clip
Apps” means the iOS and Android mobile applications developed by Clip, which deliver the Hosted Application Services.
Clip Apps specifically include the Station Apps and Reach Syndicated Program Applications.

 

“IP
Rights” means all patents, trademarks (and associated goodwill therewith), trade secret rights, know how, copyrights
and other forms of intellectual property rights and protections throughout the world, whether currently existing or hereafter developed
or acquired and whether now known or hereafter recognized, including, without limitation, any Internet domain names.

 

“Law”
means any applicable law, statute, ordinance, code, rule, regulation, order, judgment, decree, requirement or procedure enacted,
adopted, applied, enforced or followed by any governmental authority.

 

“Platform
Fees” means monthly fee payments to Clip for the ongoing services support to XXXXX sales and programming teams as well
as for content recognition, hosting, updates and enhancements to the applications and web player. Platform Fees are set forth on
Exhibit A.

 

“Reach
Media Syndicated Sites” means the websites associated with each Reach Syndicated Program Application.

 

“Related
Parties” means any owner, parent, partner, Affiliate subsidiary, agent, subcontractor, director, officer, hired or leased
employee or worker, agent, representative or permitted assignee or successor of XXXXX or Clip, as the case may be and as the context
requires.

 

“Representatives” mean a party’s
employees, officers, directors, advisors, service providers, Affiliates and agents.

 

“Specifications” means (a) the
functional, component performance, system performance, interface, compatibility, design characteristics, features, specifications,
operational and technical criteria or other requirements of the Clip Apps identified in documentation provided to XXXXX and incorporated
within this Agreement by this reference; and (b) any mutually agreed upon specifications, requirements, criteria, features, or
functionality of any Enhanced Content.

 

“Subscribers”
means members of the public that download and subscribe to a Clip App in connection with any XXXXX Station.

 

“Web Players”
means the web accessible interfaces developed by Clip, which deliver the Hosted Application Services.

 

 

 

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	2.	SERVICES.

 

2.1          
General. During the Term, Clip shall use commercially reasonable efforts to develop, customize, implement, host and
support and manage the Clip Apps, Web Players and Enhanced Content to ensure the Enhanced Content available to Subscribers or potential
Subscribers via the Clip Apps and Web Players pursuant to the terms of this Agreement and the Statement of Work attached as Exhibit
A (the “Hosted App Services”). Additionally, Clip agrees to provide XXXXX and the Reach Media with all fixes, improvements,
updates and upgrades (“Upgrades”) to the Hosted App Services, free of charge, to the extent such Upgrades are made
available free of charge by Clip to other customers.

 

2.2          
Updated App or Enhanced Content. From time to time during the Term of the Agreement and within ten (10) business
days of receipt of XXXXX's written request for any Clip App update or Enhanced Content that is not immediately offered by Clip,
or self-administrated through Clip's Content Management System (“CMS”), Clip shall confirm whether it is able to make
the requested changes in the functionality of the Clip Apps and Web Players or Enhanced Content, and provide a proposed deployment
date (the “Target Deployment Date”) and, if agreed to by XXXXX, shall provide the modified Clip Apps and/or Enhanced
Content to XXXXX at least three (3) business days before the Target Deployment Date for such Clip App or Enhanced Content for
XXXXX’s review and acceptance testing, pursuant to the procedures set forth in Section 2.4. Upon Acceptance by XXXXX, Clip
shall promptly make such Clip Apps and/or Enhanced Content available in accordance with this Agreement. XXXXX shall deliver any
updates to its content at least ten (10) business days prior to the Target Deployment Date. Content means the content created
by or originating from XXXXX stations or the Reach Media for use, distribution or display with Clip Apps utilized by XXXXX and
the Reach Media. Each update cycle requires ten business days to complete. The latest published revisions of coverage in Clip’s
coverage database are included in these updates.

 

		2.3	Professional Services.

 

2.3.1       
Statements of Work. During the Term, Clip will perform certain consulting, development, integration services and/or
other services at the request of XXXXX (“Professional Services” and together with the Hosted Application Services,
the “Services”) for XXXXX as described in any Statements of Work agreed to by the parties. All such work will
be performed in a competent, timely and professional manner consistent with recognized industry standards Each Statement of Work
shall be executed by the parties and include a description of the Services to be performed, identification of, and completion dates
for, all deliverables to be completed and provided by Clip and any resulting fees (“Deliverables”). The initial
Statement of Work is attached as Exhibit A.

 

2.4          
Review, Testing and Acceptance. Upon the completion of each Deliverable or other work product, including,
without limitation, any Enhanced Content, Clip shall deliver such Deliverable to XXXXX. XXXXX shall have a period of ten (10) business
days after receipt of the Deliverable from Clip (the “Acceptance Test Period”) to review and test the Deliverable
to determine whether the same complies in all material respects with the requirements of this Agreement, the Specifications and
the Statement of Work.

 

2.4.1       
Acceptance. If XXXXX determines in its reasonable good faith judgment, that the Deliverable complies in all material
respects with the requirements of this Agreement, the Specifications and the Statement of Work, then XXXXX shall accept the same
by delivering a written notice of acceptance to Clip (“Acceptance” or “Accept”) within 3
business days of the expiration of the Acceptance Test Period. Failure to provide Acceptance within the prescribed time shall not
be deemed an acceptance by XXXXX.

 

2.4.2        
Defects. If XXXXX discovers a defect with respect to any Deliverable or any other failure of the same to comply in
all material respects with the requirements of this Agreement, the Specifications and the Statement of Work, XXXXX shall send a
notice to Clip describing the defect in reasonable detail (the “Defect Notice”). After receipt of the Defect
Notice, Clip promptly shall remedy such defects and resubmit the Deliverable to XXXXX for an additional testing period. The length
of such additional testing period shall be ten (10) business days from the receipt of the Defect Notice.

 

 

 

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	3.	LICENSES; ENHANCED CONTENT.

 

		3.1	Grant of License By Clip.

 

3.1.1       
Clip Apps. During the Term, Clip hereby grants to XXXXX and the Reach Media a limited, revocable, non-exclusive,
non-transferable right and license to: (a) use, operate, maintain, distribute and display the Enhanced Content via the Clip Apps;
and (b) sublicense and/or otherwise grant Subscribers or potential Subscribers of XXXXX the right to use the Clip Apps as needed
in order to permit such Subscribers or potential Subscribers to access, view, and use the Enhanced Content.

 

3.1.2       
Distribution. During the Term, Clip will provide XXXXX and the Reach Media with online locations at which the Clip
Apps are available (collectively, the “Landing Pages”). In its sole discretion, XXXXX may: (a) include links
to the Landing Pages from XXXXX’s web sites, (b) publish the Landing Pages URLs on marketing and promotional materials;
and/or (c) provide the URLs for the Landing Pages to such resellers and retailers as XXXXX may designate from time to time (“Authorized
Third Parties”) who, in turn, may include the links to the Landing Page at the websites of such Authorized Third Parties.

 

3.1.3       
Restrictions. Except as otherwise set forth in this Agreement, neither XXXXX, nor Reach Media will, and will not
authorize its Representatives to: (a) modify, translate, reverse engineer, decompile, or disassemble the Clip Apps; (b) copy the
Clip Apps; or (c) remove any proprietary notices or labels on or in the Landing Page, if any. Notices or labels shall be defined
any written disclaimers, rules, restrictions or permission requirements about content.

 

3.2          
Transfer of License. In the event of a sale or change of control of a XXXXX Station Site, or a Reach Media
Syndicated Site, XXXXX and the Reach Media shall each have the right to transfer their respective license to: (a) use, operate,
maintain, distribute and display the Enhanced Content via the Clip Apps or (b) sublicense and/or otherwise grant Subscribers or
potential Subscribers of XXXXX the right to use the Clip Apps as needed in order to permit such Subscribers or potential Subscribers
to access, view, and use the Enhanced Content.

 

		3.3	Grant of License By XXXXX.

 

3.3.1       
XXXXX Marks. Subject to the terms and conditions of this Agreement, during the Term of this Agreement, XXXXX grants
to Clip a limited, non-exclusive, non-transferable, non sub licensable, royalty-free license to use the trade names and service
marks of XXXXX that XXXXX designates and provides to Clip for display on the Landing Pages and Enhanced Content and in the Clip
Apps (collectively, the “XXXXX Marks”) utilized by or on behalf of XXXXX.

 

3.3.2       
XXXXX Approval. Clip will not, nor will Clip authorize any third party to, make use of XXXXX Marks unless and until
each instance of such use has been approved in writing by XXXXX (which may be provided by XXXXX by email). Clip shall furnish to
XXXXX for its written approval all materials prepared by or on behalf of Clip relating to this Agreement that include any XXXXX
Marks. XXXXX shall have a period of not less than ten (10) business days to respond to such request for approval (“Approval
Period”). If XXXXX fails to approve in writing any request during the Approval Period, such request shall be deemed denied.
All approvals granted in accordance herewith shall (a) be valid solely during the term specified by XXXXX, (b) be limited to the
specific purpose for which approval was sought and received and (c) subject to Clip’s obligations hereunder, be deemed a
limited, non-exclusive, non-transferable, revocable right and license, without right to sublicense, to use the specific XXXXX Marks
for the use approved by XXXXX, which right and license shall terminate and revert to XXXXX contemporaneously with the expiration
of this Agreement or upon any earlier termination thereof, as applicable. All such uses shall be in accordance with the procedures
and guidelines provided to Clip by XXXXX from time to time.

 

 

 

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3.4          
During the Term, XXXXX and Reach Media hereby grants to Clip a limited, revocable, non- exclusive, non-transferable,
non sub licensable right and license to: (a) incorporate the Content within the Clip Apps solely to operate, maintain, distribute
and display the Content via the Clip Apps for XXXXX and Subscribers of XXXXX and (b) enhance the content at the request of XXXXX.
Use of Content and Enhanced content by Clip shall be solely as needed in order to permit Subscribers of XXXXX to access, view,
and use the Enhanced Content. No other use shall be made of the Enhanced Content or Content by Clip, without first securing XXXXX’s
express written permission.

 

3.5          
All rights in the Enhanced Content, Content and XXXXX Marks not expressly granted to Clip pursuant to this Section
3.3, are reserved by XXXXX and Reach Media.

 

3.6          
Obligations Upon Termination. Within ten (10) days after the date of expiration or termination of this Agreement,
(i) Clip shall cease using (and direct any person under its control to not use) the XXXXX Marks on the Clip Apps and Enhanced Content
and (ii) the license granted to XXXXX by Clip in Section 3.1 shall terminate on such date of expiration or termination.

 

	4.	OWNERSHIP.

 

4.1          
Enhanced Content. Subject to Section 4.2 below, all Enhanced Content is and shall be considered a work
made for hire for XXXXX (or as the case may be the Adopting Affiliate) as such term is defined in Section 101 of the Copyright
Act of 1976, as amended. If and to the extent that the Enhanced Content (or any portion thereof) is not deemed to be a work made
for hire, Clip shall, and hereby does, exclusively and irrevocable assign, transfer and otherwise convey to XXXXX all right, title,
and interest in and to the Enhanced Content, including all rights of copyright or other intellectual property rights pertaining
thereto. XXXXX retains ownership of all Content (enhanced or otherwise) together with all IP Rights contained therein. Notwithstanding
the foregoing, Clip will retain ownership to all pre-existing Clip materials and content (and all IP Rights therein).

 

4.2          
Clip Apps. As between the parties, Clip shall retain all title, copyright and all other IP Rights in the Clip
Apps and any modifications, enhancements and derivative works thereto. XXXXX does not acquire any right, express or implied, in
the Clip Apps, other than those specified in this Agreement and nothing in this Agreement is intended to confer, by implication,
estoppel or otherwise, upon XXXXX a license to or any rights in any IP Rights of Clip.

 

4.3         
Clip IP. XXXXX acknowledges that the Clip Apps and any other patent, trade secret and proprietary rights in
connection with the proprietary software used to develop, and embodied within, the Clip Apps, including the object code and the
source code for such software, along with all ideas, methods, algorithms, formulae and concepts used in the development of such
software and any modifications, enhancements or derivative works to the software (“Clip Proprietary Software”),
including all techniques and concepts that were conceived or first produced by Clip in the performance of this Agreement, including
any such techniques that are included within any Enhanced Content constitute “Clip IP” and remain the sole and
exclusive property of Clip.

 

4.4          
Other Clip Intellectual Property. Notwithstanding the foregoing, in the event XXXXX provides a new feature
in respect of the Clip Apps or Hosted App Services that is proprietary to XXXXX and not currently in use by Clip (or contemplated
for future use by Clip provided by XXXXX that the applicable SOW designates as intellectual property owned by XXXXX, such XXXXX
intellectual property will be owned by XXXXX.

 

4.4.1       
Third Party Materials. To the extent that any materials owned by or licensed from third parties, other than the XXXXX
Marks, (the “Third Party Materials”) are included in any Enhanced Content, Clip shall obtain for XXXXX, at Clip’s
sole cost and expense, a perpetual, irrevocable, worldwide license to: (a) use, reproduce, distribute, publicly perform, publicly
display, modify and prepare derivative works of such Third Party Materials; and (b) sublicense any of the foregoing rights

 

 

 

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	5.	PAYMENT.

 

5.1          
Platform Service & Support Fees for Station Applications: In consideration of the Hosted App Services,
commencing as of the Initial Deployment Date, XXXXX shall pay Clip a monthly Platform Services and Support Fee of $250 per station.
These fees cover all on-going Clip App and Web Player services and support for the duration of the Term. XXXXX may, in its sole
discretion, elect to add an additional station and any additional stations will be charged the per station fee set forth herein.
If XXXXX elects to delete station(s) utilizing the Hosted App Services the monthly Platform Services and Support Fee shall be
reduced by $250.00 per each deleted station.

 

5.2          
Platform Service & Support Fees for Reach Syndicated Program Applications: In consideration of the Hosted
App Services for Reach Media Reach Syndicated Program applications commencing as of the Initial Deployment Date, XXXXX shall pay
Clip a monthly Platform Services and Support Fee of $250 minimum, per Reach Syndicated Program Application. The monthly service
and support fee is set forth on Exhibit A, Section 12. If XXXXX elects to delete Reach Syndicated Program Applications utilizing
the Hosted App Services, the fees for Hosted App Services for the Reach Syndicated Program Applications will be reduced by $250.00
per deleted Reach Syndicated Program Application.

 

5.3          
Platform Fee Payments: Following the Initial Deployment Date, XXXXX shall pay to Clip the monthly Platform
Services and Support Fees by the 15th of each month, as set forth in an invoice that will
be delivered at the 1st of the calendar month.

 

 5.4           Advertiser Campaign Fees: Clip is waiving all ad campaign fees for XXXXX.

 

 5.5           Advertiser Campaign Fee Payments: Clip is waiving all ad campaign fees for XXXXX.

 

5.6          
Disputed amounts shall be paid within ten (10) business days of resolution of such dispute. Adjustment for any billing
errors or Service Level Credits (as defined on the Service Level Agreement attached as Exhibit B hereto) shall be made monthly.

 

5.7          
Audit. For a period of three (3) years after the expiration or termination of this Agreement, Clip shall maintain
complete and accurate records to substantiate payments made or due hereunder. XXXXX shall have the right to inspect, copy, verify
and audit such books and records at any time upon two (2) weeks’ prior written notice to the other party. Clip will reimburse
the auditing party for any reasonable, documented expenses incurred by such auditing party in connection with any audit, which
results in the correction of a billing error by Clip in an amount greater than 5% of the charges that were subject to such audit
for the period audited.

 

	6.	REPRESENTATIONS, WARRANTIES AND COVENANTS;
DISCLAIMER.

 

		6.1	Title. Clip hereby represents, warrants and covenants to XXXXX as of the Effective Date that:

 

		6.1.1	The Clip Apps do not and shall not infringe any third party’s IP Rights.

 

6.1.2        Clip's performance of the Hosted
Application Services does not and will not infringe any third party’s IP Rights.

 

6.1.3       
There are no allegations, claims, suits, actions, investigations or proceedings against Clip (each a “Claim”)
or any threatened Claims asserting that the Clip Apps infringe or violate any third party’s IP Rights.

 

 

 

    	 	6	 

     

    

 

6.1.4       
Clip has not previously granted any rights in the Clip Apps, work product or Hosted Application Services to any third party
that are inconsistent with the rights granted herein to XXXXX.

 

6.1.5       
The enhancements made to the Enhanced Content do not and shall not infringe any third party’s IP Rights.

 

6.1.6        The Hosted Application Services
do not and shall not infringe any third party’s IP Rights.

 

6.2               
Exclusive Warranties; Disclaimer. EXCEPT AS PROVIDED IN SECTION 3 THROUGH 10 OF EXHIBIT A, THE SERVICE LEVEL
AGREEMENT AND THE DOCUMENTATION, THE CLIP APPS, ENHANCED CONTENT OR THE LANDING PAGES AND DOCUMENTATION ARE PROVIDED “AS
IS,” AND CLIP MAKES NO (AND HEREBY DISCLAIMS ALL) OTHER WARRANTIES, REPRESENTATIONS, OR CONDITIONS, WHETHER WRITTEN, ORAL,
EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF SATISFACTORY QUALITY, COURSE OF DEALING,
TRADE USAGE OR PRACTICE, MERCHANTABILITY, TITLE, NONINFRINGEMENT, OR FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE USE,
MISUSE, OR INABILITY TO USE THE CLIP APPS, ENHANCED CONTENT OR THE LANDING PAGES, OR DOCUMENTATION (IN WHOLE OR IN PART) OR ANY
OTHER PRODUCTS OR SERVICES PROVIDED TO XXXXX BY CLIP. CLIP DOES NOT WARRANT THAT ALL ERRORS CAN BE CORRECTED, OR THAT OPERATION
OF THE CLIP APPS, ENHANCED CONTENT OR THE LANDING PAGES SHALL BE UNINTERRUPTED, SECURE, OR ERROR-FREE. SOME STATES AND JURISDICTIONS
DO NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES OR CONDITIONS OR LIMITATIONS ON HOW LONG AN IMPLIED WARRANTY LASTS, SO SOME OF
THE ABOVE LIMITATIONS MAY NOT APPLY.

 

	7.	INDEMNIFICATION.

 

7.1               
Indemnification by Clip. Clip shall indemnify, defend and hold harmless XXXXX and its Related Parties from
and against any and all losses, settlements, claims, actions, suits, proceedings, investigations, judgments, awards, damages and
liabilities actually suffered or incurred (collectively, “Losses”), and shall reimburse XXXXX for any and all
legal, accounting and other fees, costs and expenses reasonably incurred in connection with investigating, mitigating or defending
any such Loss (collectively, “Expenses”), in each case, which Losses or Expenses are sustained or incurred by
any of them and arise out of (a) a third party allegation that the Clip Apps, Enhanced Content or the Hosted Application Services,
or the use thereof, infringes or constitutes a wrongful use of any third party IP Right, right of privacy or publicity or similar
right (collectively, a “Claim of Infringement”) or (b) any other third party claim caused by, relating to or
arising out of an alleged breach by Clip of any term, representation, warranty or covenant of this Agreement by Clip.

 

7.2               
Indemnification by XXXXX. XXXXX shall indemnify, defend and hold harmless Clip and its Related Parties from
and against any and all Losses and Expenses that are sustained or incurred by or asserted against any of them and arise out of
(a) any Claim of Infringement in connection with the XXXXX Marks or any content or programming provided by XXXXX (exclusive of
any enhancements made by Clip, or the Content and Enhanced Content); or (b) any third party claim caused by, relating to or arising
out of an alleged breach by XXXXX of any term, representation, warranty or covenant of this Agreement by XXXXX.

 

		7.3	Remedies and Limitations; Combinations.

 

7.3.1                     
Remedies. Without limiting Clip’s foregoing indemnification obligations, in the event of any third party Claim
of Infringement, or if Clip becomes aware of any impending Claim of Infringement, Clip may, at its option and expense; (a) procure
for XXXXX, at no cost to XXXXX, the right to continue to use such Clip Apps; (b) replace or modify the Clip Apps; or (c) terminate
the licenses under this Agreement and refund to XXXXX any Revenue Share paid for the Clip Apps that are applicable for the period
of time following the date of the Claim of Infringement.

 

 

 

    	 	7	 

     

    

 

7.4               
Indemnification Process. In the event that a party is entitled to indemnification pursuant to this Section,
the party seeking indemnification (the “Indemnified Party”) shall provide the party from which indemnification
is sought (the “Indemnifying Party”) with: (a) prompt written notification of any such Losses; (b) sole control
and authority over the defense or settlement thereof ;and (c) all available information and reasonable assistance necessary to
settle and/or defend any such Losses, at the Indemnifying Party’s expense, provided that if any settlement requires any
action or admission by the Indemnified Party, then the settlement will require the Indemnified Party’s prior written consent.
Failure by an Indemnified Party to provide prompt notice of a Loss or to provide such control and authority or information and
assistance, shall not relieve the Indemnifying Party of its obligations, except to the extent that the Indemnifying Party is materially
prejudiced by such failure. The Indemnified Party may have its own counsel present at and participating in all proceedings or
negotiations relating to a Loss, at Indemnified Party’s own expense.

 

	8.	LIMITATION OF LIABILITY

 

8.1               
General. IN NO EVENT SHALL ANY PARTY BE LIABLE TO ANOTHER PARTY UNDER THIS AGREEMENT, OR TO ANY RELATED PARTY
OF SUCH PARTY, FOR ANY INCIDENTAL, CONSEQUENTIAL, INDIRECT, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES, (EVEN IF PREVIOUSLY APPRISED
OF THE POSSIBILITY THEREOF), WHETHER THE BASIS OF THE LIABILITY IS BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY),
STATUTES, OR ANY OTHER LEGAL THEORY. EACH PARTY’S’ CUMULATIVE LIABILITY UNDER ANY AND ALL CLAIMS FOR LOSS OR LIABILITY
BASED UPON, ARISING OUT OF, RESULTING FROM, OR IN ANY WAY CONNECTED WITH THE PERFORMANCE OR BREACH OF THIS AGREEMENT, SHALL IN
NO CASE EXCEED THE AGGREGATE DOLLAR AMOUNT ACTUALLY PAID BY XXXXX TO CLIP HEREUNDER.

 

8.2               
Exclusions. THE FOREGOING LIMITATIONS OF LIABILITY SHALL NOT APPLY WITH RESPECT TO ANY OF THE FOLLOWING: (A)
A PARTY’S INDEMNIFICATION OBLIGATIONS HEREUNDER; (B) A BREACH BY A PARTY OF ITS CONFIDENTIALITY OBLIGATIONS HEREUNDER; OR
(C) ANY DAMAGES RESULTING FROM A PARTY’S FRAUD, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

 

	9.	CONFIDENTIALITY AND MEDIA RELEASES

 

9.1               
Confidential Information. As used in this Agreement, the term “Confidential Information”
shall mean any and all information prepared or delivered to the receiving party by the disclosing party or its Representatives
(including information or data received by the disclosing party from a third party and as to which the disclosing party has confidentiality
obligations), that (a) is marked or designated by the disclosing party as “confidential” or “proprietary,”
(b) is disclosed orally or visually provided that such information is identified at the time of such disclosure as proprietary
or confidential, and that within thirty (30) days thereafter a written summary of such oral and visual disclosure bearing the
aforesaid type of label or legend, is provided to the receiving party or (c) 
is known to the receiving party, or should be known to a reasonable person given the facts and circumstances of the disclosure,
as being treated as confidential or proprietary by the disclosing party. The terms of this Agreement shall constitute the Confidential
Information of both parties.

 

9.2               
Treatment of Confidential Information. The receiving party shall keep in strictest confidence and trust all
Confidential Information of the disclosing party and shall not (a) except as expressly provided herein, disclose any such Confidential
Information to any other entity or person other than a recipient’s Representatives or (b) use such Confidential Information
except and solely for the performance of each party’s respective obligations hereunder. The receiving party will not use
any Confidential Information of the disclosing party for any purpose not expressly permitted by this Agreement and will disclose
the Confidential Information of the disclosing party only to the receiving party’s Representatives who have a need to know
such Confidential Information for purposes of this Agreement and only after the receiving party has notified such Representatives
that such information is the Confidential Information of the disclosing party. The receiving party shall use at least the same
care and discretion to avoid disclosure of the disclosing party’s Confidential Information as it uses with its own similar
Confidential Information, and in no event with less than reasonable care. The obligations of the parties pursuant to this Agreement
shall terminate on that date which is two (2) years after the date of this Agreement. “Confidential Information”
does not include information that demonstrably (a) is or becomes generally available to the public other than as a result of a
disclosure by the receiving party, (b) was possessed by the receiving party prior to being furnished by the disclosing party,
provided that the source of such information was not known by the receiving party to be bound by a confidentiality agreement with,
or other obligation of confidentiality to, the disclosing party or any other party with respect to such information, (c) is independently
developed by the receiving party without use of or reference to the Confidential Information of the disclosing party and without
breach of this Agreement or (d) becomes available to the receiving party from a source other than the disclosing party, provided
that such source is not known by the receiving party to be bound by a confidentiality agreement with, or other obligation of confidentiality
to, the disclosing party or any other party with respect to such information. Further, it shall not be a violation of Section
9.2 for a party to disclose Confidential Information of the other party in response to a subpoena or other legal process served
upon the receiving party or where applicable Law requires the disclosure of such information, provided that, if not prohibited
under applicable law, the receiving party gives reasonable prior written notice to the disclosing party sufficient to permit the
disclosing party to seek a protective order if it so chooses and discloses only that information that is legally required to be
disclosed.

 

 

 

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9.3               
Remedies. Each of the parties acknowledges and agrees that the other would be irreparably harmed if any Confidential
Information of the disclosing party were to be disclosed to third parties, or if any use were to be made of such Confidential Information
other than that permitted under this Agreement, and further agrees that the disclosing party shall have the right to seek injunctive
relief upon any violation or threatened violation of the terms of this Section 9, in addition to all other rights and remedies
available at law or in equity, without having to post a bond or other security.

 

9.4               
Return of Confidential Information. Upon the termination, cancellation or expiration of this Agreement for
any reason or upon the reasonable request of the disclosing party, all Confidential Information, together with any copies that
may be authorized herein, shall be returned to the disclosing party or, if requested by the disclosing party, certified destroyed
by the receiving party; provided, however, that this Section 9.5 shall not apply with respect to Confidential Information
which is needed in connection with the use, installation and support of the Clip Apps.

 

9.5               
No License. Except as explicitly set forth herein, nothing in this Agreement is intended to or shall grant
to either party any license or other right of any nature to the use of any Confidential Information of the other or any intellectual
property rights relating to the Confidential Information of the other.

 

	10.	TERM AND TERMINATION

 

10.1            
Term. This Agreement shall be effective as of the Effective Date and shall continue for a period of two (2)
years following the Initial Deployment Date, (the “Initial Term”), unless earlier terminated as provided herein.
XXXXX may elect to renew the Agreement for two (2) consecutive one (1) year periods by providing notice to Clip within thirty (30)
days prior to the end of the then current term (each a “Renewal Term”). The fees set forth in this Agreement shall
apply to each Renewal Term, unless otherwise mutually agreed to by the parties. word “Term” as used herein shall
be deemed to consist of the Initial Term and any such Renewal Terms for purposes of this Agreement.

 

		10.2	Termination of Agreement. Either party may terminate this Agreement:

 

10.2.1     
If the other party makes an assignment for the benefit of creditors or if the other party ceases to do business or otherwise
terminates its business operations, other than after an assignment, which is permitted by the terms of this Agreement.

 

10.2.2           
If the other party becomes insolvent, or voluntary or involuntary proceedings are instituted by or against such other party
under any federal, state, or other bankruptcy or insolvency Laws, and, in the case of proceedings commenced against such party,
such proceedings are not terminated within sixty (60) days, or a receiver is appointed for such other party.

 

10.2.3           
If the other party fails to perform any material provision of this Agreement and does not cure such failure within a period
of thirty (30) business days after receipt of notice from the other party reasonably specifying such failure, or if such failure
cannot reasonable be cured within such thirty (30) business day period, the other party fails to (i) promptly commence to remedy
such failure, (ii) continuously and diligently pursue the remedy of such failure, and (iii) cure such failure within a period of
thirty (30) calendar days after receipt of the notice of failure (or such other time period as agreed upon by the parties).

 

10.2.4           
At any time XXXXX may terminate this agreement by providing Clip with written notice thirty (30) days in advance of the
specified termination date

 

 

 

    	 	9	 

     

    

 

10.2.5             
Transition Period. Clip shall work in cooperation and in a timely manner with XXXXX and Adopted Affiliate to support
XXXXX or its designee to provide the Transition Services, and shall not act in a manner so as to impede or delay XXXXX’s
transition efforts. Absent CLIP’s and XXXXX’s written agreement such transition shall not extend for a period of more
than thirty (30) days following the expiration or termination of the Agreement (the “Transition Period”).

 

	11.	MINIMUM SERVICE LEVEL
COMMITMENTS

 

11.1         
In the event Clip is unable to continue maintenance and servicing of XXXXX’s Clip Apps or Web Players, such
as due to occurrence of one of the scenarios defined in Sections 10.2.1 or 10.2.2 or due to an inability of Clip
to continue to fully operate the business financially or operationally, Clip guarantees the following minimum service level commitments
set forth in Sections 11.2 through 11.4 below for the applications provided to XXXXX for a minimum of (90) days from
the time of written notification to XXXXX of such a forthcoming event:

 

11.2
Monthly Uptime Standard: The Hosted App Service shall be available to XXXXX twenty-four (24) hours a day, seven (7) days
per week, ninety-nine percent (99.9%) of the time, calculated on a monthly basis (“Monthly Uptime Standard”)
as described in Exhibit B: Service Level Agreement.

 

11.3            
App Store & Developer Keys: XXXXX’s Clip Apps will remain functional in the iOS and Android App
stores and the existing developer account keys will be given to XXXXX for future administration rights.

 

11.4              
Feature/Functionality Continuation: The following features will remain fully functional in XXXXX applications
and web players audio streaming, audio podcast download, 3rd party ad serving, 3rd party integrated
content feeds and/or any 3rd party link/ULR that has been integrated into the application
that is hosted and managed by a party other than Clip for a minimum of 12 months from the time of written notification to XXXXX
of such a forthcoming termination event as set forth.in section 10.2.

 

11.5            
Existing User Database: All existing XXXXX user database information in Clip’s possession will be transferred
to XXXXX programming and/or digital administration team(s) in a manner and frequency as requested by XXXXX, so that future contact
and communication with the user base can be assured regardless of Clip’s continued operation of the applications beyond the
initial Term.

 

11.6            
Other Features/Functionality: The continuation of features and functionality within XXXXX’s Clip Apps
and Web Players, other than those described in Sections 11.2 through 11.4 above, will be at Clip’s sole discretion,
if such a situation arises where Clip is unable to maintain full operational capacity of all features and functionality of these
applications.

 

 

 

    	 	10	 

     

    

 

	12.	NOTICES

 

Except
as provided in any express provision of this Agreement, any notice, request, approval, authorization, consent, demand or other
communication required or permitted to be given or made pursuant to this Agreement shall be in writing (except where oral notice
is specifically authorized in this Agreement) and shall be deemed given on the earliest of (a) actual receipt, irrespective of
the method of delivery, (b) on the delivery day following dispatch if sent by express mail (or similar next day air courier service)
or (c) on the sixth (6th) day after mailing by registered or certified United States mail,
return receipt requested, postage prepaid and addressed as follows:

 

	 	If to XXXXX:	XXXXX, Inc.
	 	 	1010 Wayne Ave.
	 	 	14th Floor
	 	 	Silver Spring, MD 20910
	 	 	Attn: General Counsel
	 	 	 
	 	 	With a copy to:
	 	 	Interactive One LLC
	 	 	4 New York Plaza
	 	 	Suite
501
	 	 	New York, New York 10004
	 	 	Attn: Vice President of Legal and Business Affairs
	 	 	 
	 	If to Clip:	Michael
Lawless-CEO
	 	 	3100 Carbon Place
	 	 	Boulder, CO 80301

 

or, alternatively, to such substitute addresses
and persons as either party may designate to the other from time to time by written notice in accordance with this Section.

 

	13.	GENERAL

 

13.1            
Subcontractors. Clip shall not deploy subcontractors to such an extent that such deployment would constitute
an effective assignment of Clip’s obligations under this Agreement. Clip shall remain solely responsible for the performance
of all of its obligations hereunder, notwithstanding Clip’s deployment of any subcontractor hereunder.

 

13.2            
Relationship of the Parties. The relationship of Clip and its successors in interest, on the one hand, and
XXXXX, and its successors in interest, on the other hand, is that of independent contractors, and not one of principal and agent,
joint venture or partnership. Neither Clip, on the one hand, nor XXXXX, on the other hand, shall have any authority to create or
assume, in the name or on behalf of the other party, any obligation, express or implied, nor to act or purport to act as the agent
or the legally empowered representative of the other party for any purpose whatsoever.

 

13.3            
Binding Effect. This Agreement shall be binding on and inure to the benefit of the parties and their respective
permitted successors and assigns. XXXXX may assign its rights and delegate its duties under this Agreement (in whole or in part)
without Clip’s consent: (a) to any Affiliate of XXXXX; or (b) in connection with a merger, consolidation, sale of substantially
all of its assets, other business combination, spin-off or other restructuring. Clip may not assign any of its rights or delegate
any of its duties under this Agreement (by operation of law or otherwise) without XXXXX’s prior written consent (not to
be unreasonably withheld) except in connection with a merger, consolidation, sale of substantially all of its assets, other business
combination, spin-off or other restructuring.

 

 

 

    	 	11	 

     

    

 

13.4            
Severability. If any provision of this Agreement is declared or found to be illegal, unenforceable, or void
by a court of law, the parties shall negotiate in good faith to agree upon a substitute provision that is legal and enforceable
and is as nearly as possible consistent with the intentions underlying the original provision. If the remainder of this Agreement
is not materially affected by such declaration or finding and is capable of substantial performance, then the remainder shall be
enforced to the extent permitted by Law.

 

13.5            
Waivers. No delay or omission by either party to exercise any right or power will impair any such right or
power or be construed to be a waiver thereof. A waiver by any party of any of the covenants, conditions, or contracts to be performed
by the other or any breach thereof shall not be construed to be a waiver of any succeeding breach thereof or of any other covenant,
condition, or contract herein contained. No change, waiver, or discharge hereof shall be valid unless in writing and signed by
an authorized representative of the party against which such change, waiver, or discharge is sought to be enforced.

 

13.6            
Remedies. Except as expressly provided otherwise in this Agreement, in addition to any remedies provided in
this Agreement, the parties shall have all remedies provided at law or in equity. The rights and remedies provided in this Agreement
or otherwise under Law shall be cumulative and the exercise of any particular right or remedy shall not preclude the exercise of
any other rights or remedies in addition to, or as an alternative of, such right or remedy, except as expressly provided otherwise
in this Agreement.

 

13.7            
No Third-Party Beneficiaries. Nothing in this Agreement, expressed or implied, is intended or shall be construed
to confer upon any entity (other the parties’ respective Related Parties, permitted successors and assigns), any remedy or
claim by reason of this Agreement, and any such remedies or claims shall be for the exclusive benefit of Clip and XXXXX.

 

13.8            
Governing Law. The interpretation, validity and enforcement of this Agreement, shall be governed by the laws
of the State of Delaware.

 

13.9            
Force Majeure. Neither party is responsible for delays or failures in performance resulting from acts of God,
strikes, lockouts, riots, acts of war and terrorism, embargoes, changes in governmental regulations, epidemics, fire, communication
line failures, power failures, earthquakes or other disasters (each, an event of “Force Majeure”). If a claim
by a party for release of its obligations under this Section 13.9 exceeds thirty (30) days, then the other party has the
right to terminate this Agreement. Neither party is entitled to relief under this Section to the extent that any event otherwise
constituting an event of Force Majeure results from the negligence of fault of the applicable party or its Related Parties.

 

13.10        
Further Assurances. To the extent reasonable, the parties agree (a) to furnish upon request to any other party
such further information, (b) to execute and deliver to any other party such other documents and (c) to do such other acts and
things, all as the other party may reasonably request for the purpose of carrying out the intent of this Agreement and the documents
referred to in this Agreement.

 

13.11        
Expenses. Except as otherwise expressly set forth herein, each of the parties shall pay its own costs and
expenses associated with the execution and performance of this Agreement.

 

13.12        
Survival. The rights and obligations of the parties set forth in Sections 4.0 , 6.0, 7.0,
8.0, 9.0, 10.2.5 and 13.0 and their respective Sections, and any other provision of this Agreement that by
its nature is intended to survive, shall survive the expiration or termination of this Agreement for any reason whatsoever.

 

13.13        
Ent ire Agreement: Amendment. This Agreement. including any Exhibits and documents referred to in th s Agreement
or attached hereto and each Statement of Work executed by the parties, constitutes the entire and ex lusive statement of this Agreement
with respect to its subject matter and supersedes any and all oral or written representations, understandings. or agreements relating
thereto. This Agreement may be modified, supple ented or changed only by an agreement in writing which makes specific reference
to this Agreement and which i signed by both Clip and XXXXX.

 

 

 

    	 	12	 

     

    

 

13.14       
Captions. The captions and headings contained herein are for purposes of convenience only and are not part of this
Agreement.

 

13.15       
Construction. This Agreement and the Exhibits hereto have been drafted jointly by the parties and in thee emofanyambiguities
in the language hereof, there shall be no inference drawn in favor of or against either party.

 

13.16        
Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be dee ed an original,
but all of which shall constitute the same instrument.

 

IN WITNESS WHEREOF, Clip and XXXXX have executed
this Agreement as of the Effective Date.

 

 

		XXXXXXXX
	Name: MICHAEL LAWLESS	Name: /s/
	 	 
	Title:   CEO	Title: Executive Vice President
	 	 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	13	 

     

    

 

EXHIBIT
A

 

STATEMENT OF WORK & BUSINESS TERMS

 

		1.	Clip Agrees To Provide The Following

 

		·	Clip agrees to maintain and regularly update all deployed mobile apps and web players for all
stations and personalities.

 

		·	Provide an interactive cross platform solution for all simulcast content on broadcast, mobile,
and web thereby enhancing all forms of listening and enabling new monetization opportunities.

 

		·	Enable the delivery of XXXXX and associated brand content to the station mobile apps and web players

 

		·	Materially increase spot and digital revenue value and enable new revenue channels for XXXXX
stations.

 

		·	Increase valuation of XXXXX by driving increased revenue and profitability.

 

		2.	Clip
                                         Interactive Solution Elements
	 	 	 
	 	 	Clip will continuously provide its interactive solution to enable engagement with all radio
                              content – music, promotions, commercials and programming – for all XXXXX listeners,
                              no matter where or how they listen to XXXXX stations. Elements of that solution include:

 

		·	Station Branded Mobile Applications – Provide branded station mobile apps that enable
broadcast, streaming with interactivity & attribution to create strong local and national monetization capabilities.

 

		·	Reach Syndicated Program Branded Mobile Applications- Provide Reach Syndicated Program
branded mobile applications for up to seven (7) Reach Media Personalities to create direct listening, engagement and revenue for
each Reach Syndicated Programs.

 

		·	Station Branded Portal Capabilities – Provides access to any
XXXXX station through the XXXXX branded station app or XXXXX branded national portal applications, attracting more than just P1
listeners to your mobile apps and dramatically growing your mobile user base.

 

		·	Station Branded Interactive Web/Desktop Player – Branded station web based listening
platform that enables full interactive radio capabilities on desktop for XXXXX’s web based listening.

 

		·	Now Playing Website API – Provide access to the broadcast’s now playing information for integration
                                                                                                           into Station’s Home Web page. Information provided includes song name, artist name, album image.

 

		·	3rd Party Integrations – Integration with all
key 3rd party partners, including: Nielsen, DFP, ComScore, Apple CarPlay and Android Auto.

 

 

 

    	 	14	 

     

    

 

		3.	Clip agrees to continue to provide:

 

		·	Reach Syndicated Program content included in station feeds.

		·	Radio One portal app capabilities, enabling users to access all Radio One stations via the station
branded apps if so desired.

		·	Initial local CMS, programming, traffic and sales training as outlined in Section 8: Sales &
Programming Training.

		·	On-going local sales & programming support as outlined in Section 8: Sales & Programming
Training.

		·	Simple interactive content management system.

		·	Analytics console/dashboard as outlined in Section 6: Data & Analytics.

		·	Clip will provide updates to the Clip Apps in a manner consistent with the updates provided to
other clients, provided however that Radio One shall receive no less than two (2) Clip App updates during each twelve (12) months
during the Term at no additional cost.

 

		4.	Station & Reach Syndicated Program Branded Mobile
                                         Applications Overview
	 	 	 
	 	 	Clip will continue to provide robust mobile apps
for all XXXXX stations and Reach Media Syndicated Sites to allow for listening and interactivity of the broadcast and the stream
via the mobile app or via a mobile web browser. Clip will have access to any existing account keys/access for the development process
and ultimate release of the apps through these existing accounts.

 

		5.	Station & Reach Syndicated Program Branded Mobile
                                         App Features
	 	 	 
	 	 	This platform provides a base set of features and functionality
(itemized below).
	 	 	 
	 	 	

Station Mobile App Features List

 

		·	Mobile stream player that is compatible with XXXXX’s existing streaming provider, Triton
Digital

		·	Broadcast and streaming audio content identification and interactive feed

		·	Playlist history with artwork/artist info and lyrics

		·	1-3 hour station content “Look Back”

		·	User’s personalized “Bookmarked” content list

		·	Artist Feeds - Artist’s info, photos, videos, music, social feeds, concert info, and link
to official website. Clip will place links to artists content sites in the XXXXX App Artists Feeds allowing users to access the
artist content will in the XXXXX Apps

		·	Expanded rich interactivity for all interactive content, subject to clearances of all third party
rights.

 

 

 

    	 	15	 

     

    

 

		o	Artist content engagement

		o	Social posts from Facebook, Twitter and Instagram

		o	Ability to enter station contests/promotions

		o	Ability to request email contact from advertisers

		o	Listener polls/surveys

		o	View video content

		o	Display web coupons & offers

		o	Display content in “Featured” position

		o	Talk back feature - recorded voice messaging to station and/or host

		o	RSS feed integration for station or 3rd party content video* or audio*

		o	RSS feed integration for news/traffic/weather/sports/calendar or podcasts

		o	Station & Reach Syndicated Program social integration (Twitter/Facebook/Instagram)

		·	Station podcast vault

		·	Current program listing/history show name/host name/time description – only able to link
out to web based content hosted by station/group

		·	Alarm clock

		·	Apple CarPlay and Android Auto in dash user connectivity

		·	One-time user registration that conform to and address XXXXX’s current Privacy Policies
and to the extent possible.

		o	Name

		o	Gender

		o	Age

		o	Email address

		o	Zip code

		·	Ability for registration pass through of mobile users

		·	Ability to require user registration for engagement with featured content, contesting, promotions
and music downloads

		·	Ability to target consumption of offers by geo-location, subject to all applicable laws, rules
and regulations and at all times in compliance with XXXXX’s privacy policies.

		·	Ability to target or block content based on age in accordance with applicable laws, rules and
regulations

		·	Menu navigation button for station website, Reach Syndicated Program blogs, perks and song sharing

		·	Menu navigation button to call, email and text the stations

		·	Self-administrated Content Management System (CMS)

 

	 	 	*XXXXX is responsible for all costs associated with
streaming music royalties or any 3rd party content fees resulting from content XXXXX elects to put into its applications.
	 	 	 
	 	 	Additional features or capabilities may be added
upon XXXXX’s request. Such requested features must be scoped to determine development costs and timelines, but Clip is open
to adding additional features based on reasonable time frames and costs associated with any request.

 

 

 

    	 	16	 

     

    

 

	 	 	

Reach Syndicated Program Mobile App Features

 

		·	Free consumer apps on iOS and Android

		·	Current and historic program listing show name/host name/time description

		·	Broadcast and streaming audio interactive feed reflective of all Reach Syndicated Program content

		·	Audio streaming on mobile

		·	Audio streaming from in-studio feed on web player

		·	User activated auto replay of Reach Syndicated Program show, if the live show has ended in specific
a time zone

		·	In app podcast/on-demand library

		·	In app live in studio video feeds

		·	In app video content library

		·	“Reach Syndicated Program Talk Back Feature”- Recorded voice messaging to Reach Syndicated
Program

		·	Alarm clock/auto wake for affiliate stations

		·	User personalized “Saved List” for all Reach Syndicated Program content

		·	1-3 hour Reach Syndicated Program Scroll Back”

		·	Ability to enter all Reach Syndicated Program contests/promotions

		·	Ability to request email contact from advertisers

		·	Listener Polls/Surveys/Feedback

		·	Display web coupons and offers

		·	Display content in “Featured” position

		·	E-commerce connectivity “Reach Syndicated Program’s On Line Store” and/or 3rd Party sources like Amazon, and others (out of app)

		·	Simple user registration

		o	Name

		o	Gender

		o	Age

		o	Email address

		o	Username & password

		o	Ability for single registration pass through of mobile users
	 	o	Ability to geo-lock targeting and restrict consumption
of mobile offers/ads

		·	RSS feed integration of 3rd Party Video* or Audio* content in navigation menu

		·	RSS feed integration for traffic/weather/sports/calendar or podcasts* in navigation menu

		·	Menu buttons for each Reach Syndicated Program website, blogs, & social pages

		·	Menu buttons to call, email, text the Reach Syndicated Program Show

		·	Reach Syndicated Program Show’s social stream integration (Twitter/Facebook/Instagram)

		·	Self-administrated Content Management System with customized rules and permissions

		·	Ability to change navigation or make edits to in application without requiring an update to iOS
or Android store.
	 	·	One-time user registration that conform to and
address Reach Media’s current Privacy Policies and Terms of Service.

 

 

 

    	 	17	 

     

    

 

		6.	Station Branded Interactive Web/Desktop Player Overview
	 	 	 
	 	 	Clip will continue to provide to XXXXX a web player
that will enhance users' online listening experience; enabling listener interactions on the desktop and mobile browser. Clip will
manage the live web player, which functions on all the major web browsers as well as iOS, Android and Windows devices
	 	 	 
	 	 	

                Clip to Provide:

	 	 	 

		·	Host branded station web players for all XXXXX radio stations.

		·	User experience on web/desktop will match interactivity and attribution on mobile apps.

		·	Web interactive content management system.

		·	Web analytics console/dashboard.

		·	Web programming and sales training.

		·	Web traffic and campaign management training.

 

	 	 	Web Player Features List Pop out or embedded player in station’s web player page for the XXXXX’s website
    platform
	 	 	 

		·	Mobile web browser compatible with iOS, Android and Windows devices

		·	Web streaming audio content id and interactive feed

		·	Song/Artist info/bios

		·	Song lyrics, song purchase

		·	Artist Feeds - Artist’s info, photos, videos, music, social feeds, concert info, link to official website

		·	Events calendar

		·	User customizable real time content feeds for all music, personalities, promotions, contests, events
and content on stream

		·	User’s personalized “Bookmarked” content list

		·	Expanded rich interactivity for all interactive content

		o	Artist content engagement

		o	Social posts - Facebook, Twitter Instagram

		o	Ability to enter station contests/promotions

		o	Ability to request email contact from advertisers

		o	Listener polls/surveys

		o	View video content

		o	Print web coupons & offers

		o	“Featured” position

		o	RSS feed integration for station or 3rd party content video* or audio**

		o	RSS feed integration for news/traffic/weather/sports/calendar or podcasts*XXXXX is responsible
for all content royalty fees

 

 

 

    	 	18	 

     

    

 

	 	 	Additional features or capabilities may be added
upon XXXXX’s request. Such requested features must be scoped to determine development costs and timelines, but Clip is open
to adding additional features based on reasonable time frames and costs associated with any request.
	 	 	 
	 	 	

Now Playing API Content Feed for Website

	 	 	 
	 	 	For XXXXX music stations, Clip will provide access
to the broadcast’s now playing information for integration into Station’s Home Web page. Information provided includes
song name, artist name, and album image. The JavaScript API provides live updates as the now playing information changes. Also,
access to recent historical items is available.

 

		7.	Interactive Advertiser Capabilities
	 	 	 
	 	 	Clip’s mobile applications provide a rich
advertiser interface that allows XXXXX station’s listeners to electively respond and engage with advertiser messages in the
broadcast and stream through the app. Clip’s interface allows
the XXXXX stations to capture user engagements on advertisements during and after a broadcast or streamed advertiser spot runs,
thus extending the life of the spot beyond when the: 30 or: 60 sec on-air message runs.
	 	 	 
	 	 	All engagements with the advertisements are tracked
and measured by Clip’s analytics dashboard, which can be passed back to advertisers to show results that XXXXX stations
deliver for advertisers.
	 	 	 
	 	 	The Hosted App Services will include Clip’s
content management system and ad server that manages and serves the native Clip advertising content into the Clip Apps and Web
Players. . The Clip ad server and content management system will be fully compatible with DoubleClick for Publishers (DFP) shall
serve ad units via DFP trafficking system and shall be fully compatible with DFP’s ad serving, trafficking, creative, and
targeting capabilities. Additionally, Clip agrees to repurpose or reconfigure any existing mobile ad units, such as the current
320x50, 300x250 and mobile interstitials into a native content positions in the new applications, to insure a positive user experience,
as well as the continuation and growth of Radio One’s digital only ad revenue.
	 	 	 
	 	 	Below
is a list of the various advertiser executions that can be associated with an advertiser’s broadcast and streamed radio
spots.

	 	 	 
	 	 	

Advertiser Executions

 

		·	Tap to receive advertiser email offer.

		·	Tap to visit advertiser mobile or website/page

		·	Tap to call the advertiser directly

		·	Tap to receive redeemable advertiser mobile coupon

		·	Scratch & win to receive prize, coupon or special offer

		·	Tap to take an advertiser poll or survey

		·	Tap to enter advertiser sponsorship contest or promotion

		·	Tap to submit user permission for contact by advertiser

		·	Tap to view advertiser elective video

		·	Tap to submit UGC photo or video content to advertiser for a prize or reward (mobile only)

		·	Tap to submit recorded voice message (mobile only)

		·	Tap to enter advertiser key word or promo code to receive offers or prize

 

 

 

    	 	19	 

     

    

 

		8.	3rd Party Ad Serving & Analytics Integration Clip agrees to work with industry
recognized third party providers for all key 3rd party ad serving and analytic needs, approved
partners include – Google Analytics, Nielsen, DFP, ComScore to provide seamless delivery of existing 3rd
party ads and data.

 

		9.	Content Management System – CMS
	 	 	 
	 	 	Clip will continue to supply a robust Content Management System (CMS) for the creation, scheduling
and management of all interactive radio campaigns.

	 	 	 
	 	 	CMS Features:

 

		·	Permission based administration level access

		o	Station

		o	Market

		o	Cluster

		o	National

		·	Time based scheduling

		·	Audio recognition based scheduling

		·	Real-time campaign optimization

		·	Visual creative upload

		·	URL link upload

		·	Video link upload

		·	Contest/promotion entry set-up

		·	Polling/survey set-up

		·	Scratch off and secret word games set-up

		·	Geo-lock campaign set-up

		·	Social content set up - Facebook, Twitter, Instagram

		·	3rd Party RSS feeds set up

 

		10.	Data & Analytics
	 	 	 
	 	 	Clip will supply a proprietary, robust analytics
solution for the measurement, tracking and analysis of interactive radio campaigns for the XXXXX radio platforms. Clip analytics
will provide data and metrics on all aspects of user interaction and campaign activity for both advertising and programming. Our
analytics solution will allow for station, market and national level permission based access to user and campaign data. Campaign
and user data can be pulled by station, market, date, campaign, and creative execution. XXXXX will receive an analytics dashboard
specific to their needs and requirements. This dashboard can and will be enhanced over time as XXXXX’s needs change and
as their presence on the Clip platform expands. All personal identifiable and aggregated information collected from users and
the data and analytics collected pursuant to this Agreement is XXXXX’s confidential information and no use shall be made
of this data and analytics by Clip or its third party providers, except to the extent required to perform the services set forth
in this Agreement to XXXXX and the Reach Media.

 

 

 

    	 	20	 

     

    

 

	 	 	The following analytics capabilities and specific metrics
are provided in the base analytics solution:

 

	 	

Analytics/Data Capabilities:

	 	Metrics (overall and unique)
	 	 	 	 
	 	App installs - by app/station	 	Impressions
	 	App installs - by cluster	 	Opens/Views
	 	App installs - overall	 	Engagements
	 	Monthly active users	 	Video starts and completions
	 	Demographics by station	 	Social shares
	 	Registered users by station	 	 
	 	Campaign results	 	 
	 	Campaign results by date	 	 
	 	Campaign poll results	 	 
	 	Campaign spot audit	 	 
	 	Campaign lead gens	 	 
	 	Campaign activity by time of day	 	 
	 	Top campaigns
by station	 	 
	 	Top campaigns by week	 	 
	 	Song charts by station	 	 
	 	Station daily activity	 	 

 

		11.	Clip Platform Training and Support
	 	 	 
	 	 	To minimize resource constraints from XXXXX,
Clip will provide support, training, education, and sales campaign set-up and management. The goal of this support is for XXXXX
stations and Reach Syndicated Program Applications to have successful programming and sales activation, driving user adoption growth
and additional revenue.

 

		·	Transition Period. Clip agrees to provide a
90-day transition period whereby Clip will continue to provide campaign set-up support as Clip trains Radio One and Reach media
staff on how to become “independent Operators”. Ongoing Programming and Promotions Training

 

		o	Program Directors, on-air talent, digital staff, and promotions teams will be trained on the capabilities
of the app and how they can be interwoven into the fold of the station and messaged out to the audience. Training will also include
a comprehensive overview of the CMS and analytics dashboard.

 

 

 

    	 	21	 

     

    

 

		·	Ongoing Sales
                                         Training

 

		o	Sales managers and their staff will be trained on how to add interactive radio to any campaign,the value it can bring to advertisers and recommended packages to be sold. Clip will also help identify the ideal interactive radio advertisers that stand to benefit the most from the technology. Training will also include a comprehensive overview of the CMS and analytics dashboard. The goal of this
support and training is to get station teams (sales, programming and promotions) to a place where they are comfortable creating interactive radio content, promoting it to their listeners, and selling interactive radio campaigns to their advertisers. While the above prescriptive training is provided, there will be opportunities for additional training as needed.

 

		12.	Press Announcement
	 	 	 
	 	 	Upon execution of this Agreement, Clip and XXXXX may
elect to create a mutually beneficial and mutually acceptable press release announcing our partnership. The goal is to establish
XXXXX as an innovative leader in the future of the radio, and to promote XXXXX’s new interactive platform to the industry
and advertisers.

 

		13.	XXXXX & Reach Media
                                         Hardware Costs, Services and Ad Fees 
	 	 	 
	 	 	Upfront Development & Hardware Fees
	 	 	 
	 	 	Clip will develop individual station branded mobile
apps for iOS and Android platforms, and branded interactive web players for all XXXXX stations and up to (7) seven national network
Reach Syndicated Program Applications for iOS and Android.
	 	 	 
	 	 	In order to monitor all XXXXX stations to make
all of the broadcast and streamed content interactive, the Clip web and mobile platform requires station monitoring hardware installation
connected to each local station’s studio automation systems.
	 	 	 
	 	 	For the Reach Media Reach Syndicated Program
apps there will be no requirement for additional monitoring hardware, as Clip will already be monitoring XXXXX stations, which
broadcast the Reach Media personalities.
	 	 	 
	 	 	Below are the costs per station that XXXXX will
pay upfront prior to the start of development of any new mobile apps and web players:
	 	 	 
	 	 	Station Apps & Web Players - One Time Development
                              & Hardware Costs
	 	 	 
	 	 	Per Station App & Web Player Development
Costs: $500 (for new apps only)
	 	 	Per Station Content Monitoring Hardware Costs:      $0

 

		*	Monitoring hardware fees will only be applied if a new Barix installation is required to monitor
a non-simulcast streamed station. If monitoring hardware is not required, then no hardware fees will be applied to that station.

 

 

 

    	 	22	 

     

    

 

	 	 	Reach Syndicated Program Apps - One Time Development & Hardware Costs:
	 	 	 
	 	 	Reach Syndicated Program App Development Costs: $1,000**
Per App (new apps only)
	 	 	 
	 	 	Monthly Platform Fees:
	 	 	 
	 	 	The platform fee includes all mobile app and web
players hosting, enhancements and services for all stations regardless of their activation of revenue. This flat monthly platform
fee is separate from the proposed Interactive Spot Advertiser Campaign fees and other digital advertising transaction fees that
are outlined later in the document.
	 	 	 
	 	 	Per Station App & Web Player Monthly Service &
Support Fee:

	 	·	Per Station App/Web Player	$250 per station app
	 	 	 	 
	 	·	Per Reach Syndicated Program Monthly Services & Support Fee:	$250 per station app

 

Interactive Spot Advertiser Campaign Set Up
& Serving Fees:

 

In order to achieve a scalable and sustainable business
model for both XXXXX and Clip, the economic goals of the stations and personalities utilizing the Clip platform is to increase
the value of broadcast and digital sales for advertisers by making both broadcast and streaming ad content richly interactive and
attributable. As we have seen, across all our station affiliates and personalities using the Clip applications and web players,
advertisers are willing to pay an average of 15% upcharge to make their broadcast and streaming campaign interactive.

 

Additionally, these interactive capabilities
have helped to bring new advertisers to radio and sustain existing advertisers who are being lured away by digital media attributable
results.

 

		14.	Clip-Sold National Digital Revenue

 

Subject to XXXXX’s prior written consent
in each instance Clip will have the right to sell national interactive mobile and web player campaigns to agencies and direct clients
that are non-competitive to XXXXX’s current agencies and advertiser relationships to run on XXXXX apps and web players. Clip
agrees to contact XXXXX for approval of Clip sold national digital advertiser campaign to run in the XXXXX applications. Applications.
XXXXX has no obligation to accept any Clip sold national digital advertiser campaign. XXXXX will have the right to supply a list
of advertiser categories it deems as inappropriate and that it refuses run on their mobile apps and web players.

 

Upon the prior written approval by XXXXX of Clip sold
national digital advertiser campaigns, Clip agrees to share this national digital revenue with XXXXX based on the percentage of
impressions and engagements from each campaign that are coming directly from the XXXXX mobile applications and web players. Clip
will pay a rev share of 33% of Clip-sold national digital campaigns with XXXXX. XXXXX’s rev share is generated from the impressions
and engagements that occur on the XXXXX mobile applications and web players. Following the first 6-months of activation Clip and
XXXXX will review revenue data and evaluate rev share.

 

Clip will provide a monthly report of all Clip-sold
national campaigns that run on XXXXX mobile application and web players, detailing the impressions, engagements per campaign and
gross and net revenues. Clip will pay XXXXX the determined revenue share within 30 days following delivery of each campaign. XXXXX
will have the right to refuse any specific advertiser that is does not feel is appropriate to run or that are deemed competitive
to XXXXX in any way.

 

 

 

 

    	 	23	 

     

    

 

Exhibit B

 

PER STATION/SYNDICATED SITE SERVICE LEVEL AGREEMENT

 

		1.	AVAILABILITY SLA.

 

		1.1.	Performance and Availability. The Hosted App Service shall be available to each radio station
and syndication site twenty-four (24) hours a day, seven (7) days per week, ninety-nine point nine percent (99.9%) of the time,
calculated on a monthly basis (“Monthly Uptime Standard”).

 

		1.2.	Service Level Credits. In the event Clip fails to meet the Monthly Uptime Standard for
any month, then upon written request from XXXXX, Clip agrees to provide the following rebates on XXXXX’s next monthly invoice
(each a “Service Level Credit”) in the amount below that relates to the aggregate length of the downtime occurrence
Additional downtime occurring in the same month will receive cumulative rebate credits on the next monthly invoice. The “Pro-rata
Fee” shall be calculated as follows: (total amount paid to Clip for any impacted campaigns divided by (number of days
in campaign).

 

		1.2.1.	In the event that Clip fails to meet uptime standards as a result of a third party, then service
level credits will not be granted.

 

		1.2.2.Clip	will provide XXXXX with a downtime report on a monthly basis on a per station/syndicated site
basis.

 

	Monthly Uptime Standard	Credit
	Unavailable 0 - 43 minutes	No credit
	Unavailable 44 - 60 minutes	5% of Pro-rata Fee
	Unavailable 60 - 120 minutes	10% of Pro-rata Fee
	Unavailable 120 - 240 minutes	15% of Pro-rata Fee
	Unavailable 240 - 300 minutes	25% of Pro-rata Fee
	Unavailable > 300 minutes	50% of Pro-rata Fee

 

		1.3.	Exceptions. XXXXX shall not receive Service Level Credits to the extent such are caused
by any of the following reasons.

 

		1.3.1.	Any latency or downtime due to XXXXX’s acts or omissions or any XXXXX communications or power
outage;

 

		1.3.2.	Scheduled maintenance; or

 

		1.3.3.	Any Force Majeure Event, as defined in the Agreement.

 

		1.4.	Scheduled Maintenance. Scheduled Maintenance shall:

 

		1.4.1.	Not be performed unless scheduled at least forty-eight (48) hours in advance of written notice;

 

		1.4.2.	Be performed between the following hours: weekdays: 10PM MDT and 4AM MDT, weekends: anytime.

 

		2.	TERMINATION RIGHTS. XXXXX may terminate this Agreement in the event that Clip fails to meet its
performance and availability criteria at any three (3) times during the Term.

 

 

 

    	 	24	 

     

    

 

Exhibit
C

 

Customer Support

 

 

 

 

Ongoing Customer Support:

 

Clip will provide a dedicated support team providing
services to XXXXX. That team will be responsible for station trainings (programming and sales), sales support (campaign management
training) and handling all end-user support issues.

 

Help Desk Support for External Users;

 

Clip will host and manage external user help desk via
telephone and email;

All Help Desk tickets from XXXXX applications will
receive a response within 6-hours of receipt.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	25Exhibit

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED.

PURCHASE AGREEMENT 
 
dated 
 
as of January 22, 2020 
 
between 
 
XIAMEN LUFU AIRCRAFT LEASING CO., LTD. 
as Seller 
 
and 
 
CONTRAIL AVIATION LEASING, LLC 
as Buyer

One (1) Boeing 737-700 aircraft bearing manufacturer’s serial number 30074 
equipped with two CFM56-7B22 aircraft engines 
bearing manufacturer’s serial numbers 890244 and 874445

i

TABLE OF CONTENTS

	
				
	 
	 
	 
	Page

	1.
	Definitions
	 
	1

	2.
	Sale
	 
	1

	3.
	Purchase Price; Deposit; Closing Procedures
	1

	4.
	Inspection of Aircraft; Delivery Condition
	3

	 
	(a)
	Inspection of Aircraft
	3

	 
	(b)
	Delivery Conditions; Title
	4

	5.
	Representations and Warranties of Seller
	4

	 
	(a)
	Organization, Etc.
	4

	 
	(b)
	Organizational Authorization
	4

	 
	(c)
	No Violation
	5

	 
	(d)
	Approvals
	5

	 
	(e)
	Valid and Binding Agreements
	5

	 
	(f)
	Litigation
	5

	 
	(g)
	Encumbrances
	5

	 
	(h)
	Brokers’ Fees
	5

	 
	(i)
	Immunity
	5

	 
	(j)
	Title to Interests
	6

	6.
	Disclaimer
	 
	6

	7.
	Representations and Warranties of Buyer
	6

	 
	(a)
	Organization, Etc.
	6

	 
	(b)
	Authorization
	6

	 
	(c)
	No Violation
	7

	 
	(d)
	Approvals
	7

	 
	(e)
	Valid and Binding Agreements
	7

	 
	(f)
	Litigation
	7

	 
	(g)
	Immunity
	7

	 
	(h)
	Broker’s fee
	7

	8.
	Conditions Precedent to the Obligations of Seller
	8

	 
	(a)
	Governing and Authorizing Documents
	8

	 
	(b)
	Purchase Price
	8

	 
	(c)
	Ferry Flight Fees
	8

	 
	(d)
	Due Authorization, Execution and Delivery
	8

	 
	(e)
	Representations and Warranties
	8

	 
	(f)
	Additional Information
	8

	 
	(g)
	Illegality
	8

	 
	(h)
	No Action or Proceedings
	8

i

	
				
	 
	(i)
	Approvals
	8

	 
	(j)
	Approvals, Consents and Notices
	9

	 
	(k)
	No Default
	9

	 
	(l)
	Delivery by the Existing Operator
	9

	 
	(m)
	No Event of Loss
	9

	 
	(n)
	Funding Evidence
	9

	 
	(o)
	Insurance
	9

	 
	(p)
	Ferry Flight Agreement
	9

	9.
	Conditions Precedent to the Obligations of Buyer
	9

	 
	(a)
	Constitutional Documents
	9

	 
	(b)
	Due Authorization, Execution and Delivery
	9

	 
	(c)
	Representations and Warranties
	9

	 
	(d)
	Illegality
	10

	 
	(e)
	No Action or Proceedings
	10

	 
	(f)
	Approvals
	10

	 
	(g)
	Delivery Location
	10

	 
	(h)
	Material Damage
	10

	 
	(i)
	No Default
	10

	 
	(j)
	Liens
	10

	 
	(k)
	Guarantee
	10

	 
	(l)
	Ferry Flight Agreement
	10

	 
	(m)
	Ferry Flight Agreement Performance
	10

	10.
	International Registry
	10

	11.
	Further Assurances
	10

	12.
	Taxes, Indemnities and Insurance
	11

	 
	(a)
	Buyer’s Obligations regarding Taxes
	11

	 
	(b)
	Seller’s Indemnity
	11

	 
	(c)
	Buyer’s Indemnity
	11

	 
	(d)
	Contest Resolution
	12

	 
	(e)
	Cooperation
	12

	 
	(f)
	Notice of Claims
	12

	 
	(g)
	Insurance
	13

	13.
	Know Your Customer
	13

	14.
	Ferry Flight
	 
	13

	15.
	Post-Ferry Flight Obligations
	13

	16.
	Miscellaneous
	14

	 
	(a)
	Notices
	14

	 
	(b)
	Confidentiality
	14

	 
	(c)
	Limitation of Liability of Any Party
	15

	 
	(d)
	Headings
	15

ii

	
				
	 
	(e)
	References
	15

	 
	(f)
	Governing Law, Jurisdiction, Attorney Fees
	15

	 
	(g)
	Severability
	16

	 
	(h)
	Amendments in Writing
	16

	 
	(i)
	Survival
	16

	 
	(j)
	Expenses
	16

	 
	(k)
	Execution in Counterparts; Signatures
	16

	 
	(l)
	Entire Agreement
	16

	 
	(m)
	Exhibits, Addendums and Schedules
	16

	 
	(n)
	Successors and Assigns
	16

	 
	(o)
	No Third Party Benefit
	16

	 
	(p)
	Assignment
	17

	 
	 
	 
	 

	 
	 
	 
	 

	SCHEDULES:
	 
	 

	 
	 
	 
	 

	Schedule 1
	Definitions
	 
	 

	Schedule 2
	Aircraft Description; Purchase Price
	 

	Schedule 3
	Aircraft Documents
	 

	 
	 
	 
	 

	EXHIBITS:
	 
	 
	 

	Exhibit A
	Form of Acknowledgment of Delivery
	 

	Exhibit B
	Form of Certificate of Technical Acceptance
	 

	Exhibit C
	Form of Bill of Sale
	 

	Exhibit D
	Form of Guarantee
	 

	 
	 
	 
	 

	ADDENDUMS
	 
	 

	Addendum A
	 
	 
	 

	Addendum B
	 
	 
	 

iii

PURCHASE AGREEMENT 
THIS PURCHASE AGREEMENT, dated as of January 22, 2020 (the “Agreement”), is entered into between XIAMEN LUFU AIRCRAFT LEASING CO., LTD., a legal entity organized under the laws of  China (“Seller”), and Contrail Aviation Leasing, LLC, a legal entity organized under the laws of North Carolina, U.S.A. (“Buyer”).
WHEREAS, subject to the terms and conditions hereof, Seller desires to sell, transfer, and convey to Buyer, and Buyer desires to purchase from Seller, one (1) used Boeing 737-700 Aircraft and related Aircraft Documents as defined herein.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements of the parties contained herein and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Seller and Buyer agree as follows:
1.Definitions
Capitalized terms used in this Agreement shall have the meanings set forth in Schedule 1 to this Agreement.
2.Sale
Subject to the terms and conditions of this Agreement, Seller agrees to sell and transfer to Buyer, and Buyer agrees to purchase from Seller, all of Seller’s right, title and interest in, to and under the Aircraft and Aircraft Documents, free and clear of all liens (other than any Permitted Liens).  The Closing of the purchase and sale of the Aircraft shall take place upon satisfaction or waiver of all of the conditions set forth in Section 8 and Section 9 on the Anticipated Closing Date but not later than the Final Delivery Date, or at such other time as Buyer and Seller may otherwise agree in writing.  
3.Purchase Price; Deposit; Closing Procedures
		
	(a)
	The initial purchase price for the Aircraft shall be in the amount set forth on Schedule 2 hereto, which is subject to adjustment as set forth below, to calculate the purchase price (“Purchase Price”).  The initial purchase price is based on the Aircraft status described in the listing below and is subject to confirmation of engine serviceability and successful completion of the Inspection described in Section 4. 

The Purchase Price shall be: 1) reduced by $[   ] per each engine cycle for any flight cycles accumulated on an engine in excess of the status defined below; and 2) increased by $[   ] per each engine cycle for the number of flight cycles accumulated on an engine less than the status defined below; provided, however, that the net amount of any purchase price adjustment hereunder and any purchase price adjustment under the Purchase Agreement MSN 30075 shall not exceed (whether as an addition to or subtraction from the Purchase Price) [    ] percent ([ ]%) of $[             ].. For avoidance of doubt, such cap does not apply to any purchase price adjustments made necessary by non-compliance with the standards 

Purchase Agreement
Page 1
    

set forth in Addendum A (save as otherwise waived by Buyer or settled by a commitment letter or any executed agreement between Seller and Buyer). 
ESN        890244    874445
CSN        27,875        36,830

		
	(b)
	Buyer has previously paid to Seller a deposit in the amount of $[       ] and shall pay to Seller the additional amount of $[       ] within five (5) Business Days of the execution of this Agreement (collectively the “Deposit”).  The Deposit shall be credited against the Purchase Price at the time of closing or refunded to Buyer in the event of the occurrence of any other deposit return events described below.

The Deposit will be returned to Buyer within five (5) Business Days of Buyer’s written request for same where any of the following deposit return events (the “Deposit Return Events”) occur:
(i)    Buyer does not deliver an executed Certificate of Technical Acceptance to Seller by the Inspection Deadline in accordance with its rights under Section 4;
(ii)    An Event of Loss to the Aircraft or Material Damage to the Aircraft occurs prior to the time of Delivery (subject to the provisions regarding Material Damage occurring during the ferry flight below).  “Material Damage” shall mean any damage which occurs before the time of Delivery where such damage meets any of the following conditions: 1) the amount of damage by reference to part-out value exceeds $[       ] in total amount, 2) the damage prevents the issuance of a Non-Incident Statement, or, in the alternative, an Accident Clearance Statement, or 3) the damage prevents Seller (or its subcontractor, on Seller’s behalf) from ferrying the Aircraft to the U.S.A. for Delivery.  Buyer shall negotiate in good faith with Seller to resolve concerns over any Material Damage to the Aircraft before requesting termination of this Agreement and/or return of the Deposit;
(iii)    Seller’s material breach of the Purchase Agreement; 
(iv)    Delivery fails to occur on or prior to a Final Delivery Date, except where such failure is as a result of Buyer’s breach of this Agreement; or
(v)    Failure of Seller to satisfy a condition precedent, except where such failure is as a result of Buyer’s breach of this Agreement.
For the avoidance of any doubt, the Deposit shall not be refundable except for the above Deposit Return Events.
Notwithstanding the foregoing, Material Damage that occurs during the ferry flight shall not serve as grounds for Deposit return or the termination of this Agreement.  Rather, Seller shall be responsible for paying the insurance proceeds associated with any Material Damage to Buyer within thirty (30) days after its receipt of the same from the insurer or insurance broker if any Material Damage occurs after commencement of the ferry flight but before Delivery, if Buyer is not otherwise paid for same through insurance payment pursuant to 

Purchase Agreement
Page 2
    

insurance required under the Ferry Flight Agreement.  Seller agrees to exercise best efforts in promptly pursuing any insurance recovery associated with such Material Damage.
		
	(c)
	Seller shall submit a copy of undated and signed Bill of Sale for the Aircraft prior to Delivery, and Buyer shall submit a copy of undated signed Acknowledgement of Delivery for the Aircraft prior to the commencement of the Ferry Flight, to be held in trust by the other party and released at the time of Delivery. The Bill of Sale shall be released to Buyer by Seller, contemporaneously with the release to Seller by Buyer of the Acknowledgment of Delivery, following confirmation of Seller’s receipt of the Purchase Price in cleared funds and satisfaction of any other conditions precedent with respect to the Aircraft.  Seller shall deliver the original Bill of Sale to Buyer and Buyer shall deliver the original Acknowledgement of Delivery to Seller within five (5) Business Days upon the Delivery for the Aircraft.  

		
	(d)
	Prior to the commencement of the Ferry Flight, Buyer shall deliver to Seller an amount equal to the Purchase Price (less the Deposit) (the “Net Purchase Price”) plus all fees in connection with the Ferry Flight, in immediately available funds, by wire transfer to the following account or any other account notified to Buyer by Seller in advance:

Bank: China Construction Bank Xiamen Pilot Free Trade Zone Branch
SWIFT code: [           ]
Bank Address: F/1, Yinsheng Building Pilot FTZ, Xiangyu, Xiamen, 
      Fujian, PRC
Account Number: [                        ]
Beneficiary: Xiamen Lufu Aircraft Leasing Co., Ltd.

4. Inspection of Aircraft; Delivery Condition
		
	(a)
	Inspection of Aircraft.  Buyer confirms that Buyer has undertaken and completed an initial review of records provided by Seller prior to the date hereof (as identified in emails dated 9/18/2019 sent by Buyer to Seller), and has no objections with respect to and is satisfied with such records. In addition, the Buyer shall have the opportunity to perform inspections of all other Aircraft Documents related to the Aircraft prior to the Ferry Flight referenced in Section 14 below. Buyer’s physical inspections of the Aircraft may include, but are not limited to, a visual inspection of interior and exterior areas of the Aircraft, MPA runs (subject to the provisions regarding MPA runs below) and engine video borescopes conducted in accordance with the AMM, all at its own cost. All inspections subsequent to the initial records inspection referenced above are collectively referred to as the “Inspection”. Buyer’s Inspection shall take place no more than twenty (20) days before Delivery in Kunming, China or another location in China if agreed in writing by the parties.

Buyer’s rights to conduct MPA runs are limited to the following rights.  Subject to the consent and availability of the existing operator, Buyer shall only be entitled to perform MPA runs in accordance with the AMM and at its own costs before the redelivery of the Aircraft from the existing operator to Seller, provided that the trends reports fails to reveal the relevant performance data in respect of the engines, if Seller determines in its sole discretion, acting in good faith, that an MPA with respect to such Aircraft is necessary.  In the case that Buyer 

Purchase Agreement
Page 3
    

fails to perform MPA runs before the redelivery of the Aircraft from the existing operator to Seller, Buyer shall only be entitled to perform MPA runs in accordance with the AMM and at its own costs within three (3) Business Days after the redelivery of the Aircraft of the Aircraft from the existing operator to Seller, provided that the trends reports fails to reveal the relevant performance data in respect of the engines, if Seller determines in its sole discretion, acting in good faith, that an MPA with respect to such Aircraft is necessary. 

Buyer shall have ten (10) days to complete its Inspection of the Aircraft, calculated from the later of the time that 1) the Aircraft is made available for physical inspection or 2) Buyer receives all back-to-birth records, ownership trace, and related technical documentation (the “Inspection Deadline”). Buyer shall promptly conduct its Inspection of the Aircraft and the records, and shall deliver to Seller email notice evidencing satisfactory completion of such Inspection, and simultaneously deliver to Seller an  executed copy of  the Certificate of Technical Acceptance, or otherwise provide written notice via email of Buyer’s decision not to proceed with the transaction, provided that the Aircraft does not satisfy the standards set forth in Addendum A to this Agreement including but not limited to the “Other Conditions” (unless as otherwise waived by Buyer in writing or settled by a commitment letter or any similar executed agreement between Seller and Buyer) no later than the Inspection Deadline, or such other date as mutually agreed by the parties in writing or by email correspondence.  Failure of Buyer to deliver an executed Certificate of Technical Acceptance to Seller by the Inspection Deadline will constitute rejection, requiring return of the Deposit. The Inspection and the delivery of  Certificate of Technical Acceptance by Buyer shall occur at Kunming, China or any other location in China if agreed in writing by the parties.

		
	(b.)
	Delivery Conditions; Title.  At the time of Delivery, the Aircraft shall meet the requirements set forth in Addendum A (save as otherwise waived by Buyer or settled by a commitment letter or any similar documents among inter alia, Seller and Buyer).  The Aircraft shall otherwise be delivered in “as-is, where-is” condition, except that all engines must be in serviceable condition in accordance with AMM limits and performance degradation commensurate with cycles operated since last shop visit. With respect to title, Seller shall deliver title to the Aircraft free and clear of all Liens (other than any Permitted Liens).  

 
5.Representations and Warranties of Seller
On the date hereof and on the Closing Date, Seller makes the following representations and warranties.
		
	(a)
	Organization, Etc.  Seller is duly organized, validly existing and in good standing under the laws of  China with all requisite organizational power and authority to own, participate in or hold under lease its properties and enter into and perform its obligations under this Agreement and any other Transfer Documents to which Seller is or will be a party (collectively, the “Seller Agreements”);

		
	(b)
	Organizational Authorization.  Seller has taken, or caused to be taken, all necessary organizational action (including, without limitation, the obtaining of any consent or approval 

Purchase Agreement
Page 4
    

of any of its board of directors or committee thereof or any officers required by its charter documents or other organizational agreements) to authorize the execution and delivery of this Agreement and each of the Seller Agreements and the performance of its obligations hereunder and thereunder;
		
	(c)
	No Violation.  The execution and delivery by Seller of this Agreement and any other Seller Agreements, the performance by Seller of its obligations hereunder and thereunder and the consummation by Seller on the date hereof and on the Closing Date of the transactions contemplated hereby and thereby, do not and will not (i) violate or contravene any provision of the charter documents or other organizational agreements of Seller, (ii) violate or contravene any law applicable to or binding on Seller or (iii) violate, contravene or constitute any default under, or result in the creation of any lien upon, any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, lease, loan or other material agreement, instrument or document to which Seller is a party or by which Seller or any of its properties is or may be bound or affected;

		
	(d)
	Approvals.  Each consent, approval, authorisation, registration and notification required by Seller to authorise, or required by it in connection with  the execution and delivery by Seller of this Agreement and any other  Seller Agreements, the performance by Seller of its obligations hereunder and thereunder and the consummation by Seller on the Closing Date of the transactions contemplated hereby or thereby have been or will be obtained on or prior to the Delivery Date.;

		
	(e)
	Valid and Binding Agreements.  This Agreement has, and the Seller Agreements have been or as of the Closing Date will have been, duly authorized, executed and delivered by Seller and, assuming the due authorization, execution and delivery by the other party or parties thereto, this Agreement and, as of the Closing Date, the Seller Agreements constitute the legal, valid and binding obligations of Seller and are enforceable against Seller in accordance with the respective terms thereof, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium and other similar laws affecting the rights of creditors generally, whether considered in a proceeding at law;

		
	(f)
	Litigation.  There are no pending or, or to the knowledge of Seller, threatened actions or proceedings against Seller before any court, administrative agency or tribunal which, if determined adversely to Seller, would prohibit or materially adversely affect the ability of Seller to perform its obligations under this Agreement or the Seller Agreements;

		
	(g)
	Encumbrances.  Seller, except as contemplated hereby, shall have no obligation to sell, assign, encumber, transfer or convey, any of its right, title or interest in, to or under the Aircraft on the Delivery Date; 

		
	(h)
	Brokers’ Fees.  Buyer shall not be liable for the fees of any broker or other Person acting on Seller’s behalf in connection with the transactions contemplated hereby;

		
	(i)
	Immunity.  Seller is, under the laws of China, subject to private commercial law and suit and is not entitled to sovereign immunity, and neither Seller nor its properties or assets have the right of immunity from suit or execution on the grounds of sovereignty; and

Purchase Agreement
Page 5
    

		
	(j)
	Title to Interests.  Seller is the sole owner of the Aircraft and has good title thereto, free and clear of any and all Liens (other than any Permitted Liens).  At Closing, such title shall be transferred to Buyer free and clear of all Liens (other than any Permitted Liens).

6.Disclaimer 
The Aircraft is being sold and assigned hereunder, “AS IS, WHERE IS” and BUYER ACKNOWLEDGES AND AGREES THAT NEITHER THE SELLER NOR ANY OF ITS AFFILIATES, OFFICERS, DIRECTORS, MEMBERS, EMPLOYEES OR REPRESENTATIVES HAS MADE OR WILL BE DEEMED TO HAVE MADE ANY TERM, CONDITION, REPRESENTATION, WARRANTY OR COVENANT EXPRESS OR IMPLIED (WHETHER STATUTORY OR OTHERWISE) AS TO, AND BUYER HEREBY WAIVES, RELEASES AND RENOUNCES ANY AND ALL WARRANTIES, OBLIGATIONS AND LIABILITIES, EXPRESS OR IMPLIED (WHETHER STATUTORY OR OTHERWISE) WITH RESPECT TO, (a) THE CAPACITY, AGE, VALUE, QUALITY, DURABILITY, DESCRIPTION (EXCEPT AS TO SERIAL NUMBERS), CONDITION (WHETHER OF THE AIRCRAFT, ANY PART THEREOF OR ITS AIRCRAFT DOCUMENTS), DESIGN, WORKMANSHIP, MATERIALS, MANUFACTURE, CONSTRUCTION, OPERATION, DESCRIPTION, STATE, MERCHANTABILITY, PERFORMANCE, FITNESS FOR ANY PARTICULAR USE OR PURPOSE (INCLUDING THE ABILITY TO OPERATE OR REGISTER THE AIRCRAFT OR USE THE AIRCRAFT IN ANY OR ALL JURISDICTIONS) OR SUITABILITY OF THE AIRCRAFT, OR ANY PART THEREOF, (b) THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, KNOWN OR UNKNOWN, APPARENT OR CONCEALED, EXTERIOR OR INTERIOR, (c) THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK, COPYRIGHT OR OTHER INTELLECTUAL PROPERTY RIGHTS, (d) ANY IMPLIED WARRANTY ARISING FROM THE COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE OR (e) ANY OTHER REPRESENTATIONS OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT OR ANY PART THEREOF OR ITS AIRCRAFT DOCUMENTS, ALL OF WHICH ARE HEREBY EXPRESSLY EXCLUDED, IT BEING UNDERSTOOD THAT NOTHING HEREIN WILL BE DEEMED TO LIMIT THE BUYER FROM AVAILING ITSELF OF ANY WARRANTIES, COVENANTS, AND REPRESENTATIONS OF ANY MANUFACTURER.
7.Representations and Warranties of Buyer
On the date hereof and on the Closing Date, Buyer makes the following representations and warranties as to itself, to Seller:
		
	(a)
	Organization, Etc.  Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of North Carolina, U.S.A., and has the power and authority to own, participate in or hold under lease its properties and to enter into and perform its obligations under this Agreement and any other Transfer Documents to which Buyer is or will be a party (collectively, the “Buyer Agreements”);

		
	(b)
	Authorization.  Buyer has taken, or caused to be taken, all necessary action (including, without limitation, the obtaining of any consent or approval of any of its board of directors 

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or committee thereof or any officers or its members required by its certificate of formation or limited liability company agreement) to authorize the execution and delivery of this Agreement and each of the Buyer Agreements, as the case may be, and the performance of its obligations hereunder and thereunder;
		
	(c)
	No Violation.  The execution and delivery by Buyer of this Agreement and any other Buyer Agreements, the performance by Buyer of its obligations hereunder and thereunder and the consummation by Buyer on the Closing Date of the transactions contemplated hereby and thereby, do not and will not (i) violate or contravene any provision of the certificate of formation, limited liability company agreement, other charter documents or other organizational agreements of Buyer, (ii) violate or contravene any law applicable to or binding on Buyer or (iii) violate, contravene or constitute any default under, or result in the creation of any lien upon, any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, lease, loan or other material agreement, instrument or document to which Buyer is a party or by which Buyer or any of its properties is or may be bound or affected;

		
	(d)
	Approvals.  The execution and delivery by Buyer of this Agreement and the Buyer Agreements, the performance by Buyer of its obligations hereunder and thereunder and the consummation by Buyer on the Closing Date of the transactions contemplated hereby and thereby do not and will not require the consent, approval or authorization of, or the giving of notice to, or the registration with, or the recording or filing of any documents with, or the taking of any other action in respect of, (i) any trustee or other holder of any debt of Buyer and (ii) any Government Entity;

		
	(e)
	Valid and Binding Agreements.  This Agreement has been and the Buyer Agreements have been or as of the Closing Date will have been duly authorized, executed and delivered by Buyer and, assuming the due authorization, execution and delivery by the other party or parties thereto, this Agreement and, as of the Closing Date, the Buyer Agreements constitute the legal, valid and binding obligations of Buyer and are enforceable against Buyer in accordance with the respective terms thereof, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium and other similar laws affecting the rights of creditors generally and general principles of equity, whether considered in a proceeding at law or in equity;

		
	(f)
	Litigation.  There are no pending or, to the knowledge of Buyer, threatened actions or proceedings against Buyer before any court, administrative agency or tribunal which, if determined adversely to Buyer would materially adversely affect the ability of Buyer to perform its obligations under this Agreement or the Buyer Agreements; 

		
	(g)
	Immunity.  Buyer is, under the laws of the North Carolina, U.S.A., subject to private commercial law and suit and is not entitled to sovereign immunity, and neither Buyer nor its properties or assets have the right of immunity from suit or execution on the grounds of sovereignty; and

		
	(h)
	Broker’s Fees.  Seller shall not be liable for the fees of any broker or other person acting on Buyer’s behalf in connection with the transactions contemplated hereby.

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8.Conditions Precedent to the Obligations of Seller
The obligation of Seller to sell, transfer, assign and convey the Aircraft to Buyer on the Closing Date is subject to the satisfaction or waiver of the following conditions:
		
	(a)
	Governing and Authorizing Documents.  A copy of the articles of incorporation and copies of the governing documents of Buyer, the resolutions of the board of directors (or other similar documents), all certified as current and correct copies by an officer of Seller, and power of attorney (if applicable) from Buyer in relation to the execution of this Agreement and the other Buyer Documents, all of which shall establish the authority of Buyer to consummate this transaction and the authority of Buyer’s designated signatory to act in such capacity;

		
	(b)
	Purchase Price.  Seller shall have received the Purchase Price via wire transfer to Seller’s account as specified in Section 3;

		
	(c)
	Ferry Flight Fees.  Buyer shall have paid a fee of $[          ] in connection with the Ferry Flight prior to the commencement of the Ferry Flight.

		
	(d)
	Due Authorization, Execution and Delivery.  This Agreement and each other Transfer Document shall have been duly authorized, executed and delivered by each party thereto other than Seller;

		
	(e)
	Representations and Warranties.  The representations and warranties of Buyer contained herein and in any other Buyer Agreements shall be true and correct as of Closing in all material respects;

		
	(f)
	Additional Information.  Seller shall have received such other documents and evidence with respect to Buyer as Seller may reasonably request in order to establish the authority of Buyer to consummate the transactions contemplated by this Agreement and the other Transfer Documents on such date, the taking by Buyer of all appropriate action in connection therewith and compliance by Buyer with the conditions set forth in this Agreement on such date;

		
	(g)
	Illegality.  The performance on such date of the transactions contemplated hereby, upon the terms and conditions set forth herein, shall not, in the reasonable judgment of Seller, violate, and shall not subject Seller to any penalty or liability under, any law, rule or regulation binding upon Seller;

		
	(h)
	No Action or Proceedings.  No legal or governmental action, suit or proceeding shall have been instituted or threatened before any court, administrative agency or tribunal, nor shall any order, judgment, regulation, tariff or decree have been issued by any government, government agency, court, administrative agency, or tribunal which sets aside, restrains, enjoins or prevents the consummation of this Agreement or the transactions contemplated hereby;

		
	(i)
	Approvals.  Seller shall have received all required governmental and regulatory approvals;

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	(j)
	Approvals, Consents and Notices.  All approvals and consents of, or notices to, any Governmental Entity, any trustee or holder of any indebtedness or obligation of the Seller or any other person, which are required in connection with the transaction contemplated by this Agreement shall have been duly obtained, given or accomplished; 

		
	(k)
	No Default.  Buyer shall not be in default of its obligations under this Agreement; 

		
	(l)
	Delivery by the Existing Operator. The existing operator shall have delivered the Aircraft to Seller pursuant to the terms and conditions of aircraft lease agreement between the existing Operator and Seller; 

		
	(m)
	No Event of Loss. No Event of Loss with regard to the Aircraft shall have occurred; 

		
	(n)
	Funding Evidence. Seller shall have received a letter from Buyer’s lender indicating that it intends to fund the purchase of the Aircraft (which may be subject to specified conditions) in favor of Buyer and/or a letter from Buyer’s CFO certifying that the CFO expects Buyer to have a cash balance or other source of funding for the purchase of the Aircraft available at the time of Delivery, such letter to be provided at least one month before the Anticipated Closing Date, upon Seller’s request; 

		
	(o)
	Insurance.  Seller shall have received the insurance certificate specified in Section 12(g); and

		
	(p)
	Ferry Flight Agreement.  The parties shall have agreed upon the terms of and executed a ferry flight agreement, which shall be attached as Addendum B to this Agreement, within 45 days of the execution of this Agreement.

9.Conditions Precedent to the Obligations of Buyer
The obligation of Buyer to purchase the Aircraft from Seller on the Closing Date is subject to the satisfaction or waiver of the following conditions:
		
	(a)
	Constitutional Documents: a certified copy of the certificate of incorporation and the up-to-date memorandum and articles of association of Seller, the resolutions of the board of directors (or other similar documents) and power of attorney (if applicable) from Seller in relation to the execution of this Agreement and the other Seller Documents, all of which shall establish the authority of Seller to consummate this transaction and the authority of Seller’s designated signatory to act in such capacity;

		
	(b)
	Due Authorization, Execution and Delivery.  This Agreement and each other Transfer Document shall have been duly authorized, executed and delivered by each party thereto other than Buyer;

		
	(c)
	Representations and Warranties.  The representations and warranties of Seller contained in the Transfer Documents shall be true and correct as of the Closing Date in all material respects;

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	(d)
	Illegality.  The performance of the transactions contemplated hereby, upon the terms and conditions set forth herein, shall not, in the reasonable judgment of Buyer, violate, and shall not subject any Buyer to any penalty or liability under, any law, rule or regulation binding upon such Buyer;

		
	(e)
	No Action or Proceedings.  No legal or governmental action, suit or proceeding shall have been instituted or threatened before any court, administrative agency or tribunal, nor shall any order, judgment or decree have been issued or proposed to be issued by any court, administrative agency or tribunal to set aside, restrain, enjoin or prevent the consummation of this Agreement or the transactions contemplated hereby;

		
	(f)
	Approvals.  Buyer shall have received all required governmental and regulatory approvals;

		
	(g)
	Delivery Location.  The Aircraft shall be located at the Delivery Location; 

		
	(h)
	Material Damage.  No Material Damage (as defined in Section 3) or an Event of Loss with respect to the Aircraft shall have occurred prior to the ferry flight;

		
	(i)
	No Default.  Seller shall not be in default of its obligations under this Agreement; 

		
	(j)
	Liens.    The Aircraft shall be free and clear of all Liens (other than any Permitted Liens); 

		
	(k)
	Guarantee.  Buyer shall have received an executed guarantee in the form set forth in Exhibit D;

		
	(l)
	Ferry Flight Agreement.  The parties shall have agreed upon the terms of and executed a ferry flight agreement, which shall be attached as Addendum B to this Agreement, within 45 days of the execution of this Agreement; and

		
	(m)
	Ferry Flight Agreement Performance.  At the time of the commencement of the Ferry Flight, Seller shall not be in default under the Ferry Flight Agreement, and Buyer shall have received the insurance certificate required thereunder. 

		
	10.
	International Registry 

At or promptly after Closing, upon request by Buyer in writing in advance, Seller shall provide any consents required to register a contract of sale for the sale of the Aircraft on the International Registry.
11.Further Assurances
Each party agrees, upon the reasonable request of the other party, at any time and from time to time, promptly to execute and deliver all such further documents, and promptly to take and forebear from all such action, as may be reasonably necessary or appropriate in order more effectively to confirm or carry out the provisions of this Agreement. Without limiting the foregoing, Seller shall, at the sole cost and expense of Buyer, do or cause to be done all acts and things as may be required to perfect and preserve the title and interest of Buyer in the Aircraft as Buyer may reasonably request, including, without limitation, that Seller shall, upon request by Buyer and at Buyer’s cost and 

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expense, cause all instruments which shall be executed pursuant to the terms hereof to be kept, filed and recorded in the appropriate office or offices pursuant to applicable laws to perfect, protect and preserve the rights and interests of Buyer hereunder and in the Aircraft.  
12.Taxes, Indemnities and Insurance
		
	(a)
	Buyer’s Obligations regarding Taxes.  Buyer hereby agrees promptly to pay and indemnify each Seller Indemnitee from and against any and all Taxes payable in connection with the sale, transfer and delivery by Seller to Buyer of the Aircraft.  The foregoing shall expressly exclude any liability for Taxes on or based on or measured by the gross or net income of Seller or capital gains of Seller or Taxes imposed by a taxing authority in a jurisdiction that would not have been imposed but for the business activity (other than the transactions contemplated hereby) or tax residence of Seller in such jurisdiction.  The parties agree to cooperate in taking actions to minimize or eliminate Taxes in connection with this transaction.

		
	(b)
	Seller’s Indemnity.  Seller hereby covenants and agrees that upon demand of Buyer it will pay and assume liability for, and indemnify, protect, defend, save and keep harmless each Buyer Indemnitee from and against, any and all liabilities, Taxes, obligations, losses, damages, settlements, claims, actions, suits, penalties, costs and expenses (including, without limitation, reasonable fees and expenses of counsel) of whatsoever kind and nature which may at any time or from time to time be imposed upon, incurred by or asserted against any Buyer Indemnitee in any way relating to, resulting from or arising out of (i) any inaccuracy or breach of any representation or warranty made by Seller under this Agreement or any Seller Agreements, (ii) any failure by Seller to have observed or performed any of its obligations under or in connection with this Agreement or any other Seller Agreements, or (iii) any claims made after Closing in respect of and to the extent attributable to the period before Closing, solely to the extent any such claim is attributable to (A) actions or omissions occurring prior to Closing, or (B) the existence of any Liens (other than any Permitted Liens) on the Aircraft attributable to the period occurring prior to Closing.  

		
	(c)
	Buyer’s Indemnity.  Buyer hereby covenants and agrees upon demand of Seller to pay and assume liability for, and indemnify, protect, defend, save and keep harmless each Seller Indemnitee from and against, any and all liabilities, Taxes, fees, obligations, losses, damages, settlements, claims, actions, suits, penalties, costs and expenses (including, without limitation, reasonable fees and expenses of counsel) of whatsoever kind and nature which may at any time or from time to time be imposed upon, incurred by or asserted against any Seller Indemnitee in any way relating to, resulting from or arising out of (i) any inaccuracy or breach of any representation or warranty made by Buyer under this Agreement or any Buyer Agreements, (ii) any failure by Buyer to have observed or performed any of its obligations under or in connection with this Agreement or any other Buyer Agreements , or (iii) any claims made after Closing in respect of and to the extent attributable to the period from and after Closing, solely to the extent such claim is not attributable (A) to the period occurring prior to Closing or (B) to Seller’s failure to perform its obligations under this Agreement or the other Seller Agreements.  

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	(d)
	Contest Resolution.  If a claim is made by any tax authority against a party hereto (the “Taxed Party”) with respect to any Tax of which another party (the “Indemnifying Party”) is obligated to indemnify under this Section 12, the Taxed Party shall promptly notify the Indemnifying Party of such claim; provided, however, that the failure to give such notice will not prejudice or otherwise affect any of the rights of the Taxed Party hereunder unless such failure materially and adversely affects the Indemnifying Party in exercising its contest rights hereunder or to the extent such failure results in any increase in, or fine or penalty with respect to, any amounts claimed to be payable by the Indemnifying Party to the Taxed Party pursuant to this Section 12.  If reasonably requested by the Indemnifying Party in writing, the Taxed Party shall (at the expense and direction of the indemnifying party) contest in the name of the Taxed Party or Indemnifying Party (as applicable), the validity, applicability or amount of such Taxes so indemnified by (i) if permitted by applicable Law without adverse consequences to the Taxed Party, resisting payment thereof, (ii) paying under protest, if protest is necessary or proper, and (iii) if payment be made, using reasonable commercial efforts to obtain a refund thereof in appropriate administrative and judicial proceedings.  If the Taxed Party becomes eligible for a refund of any Taxes paid by the Indemnifying Party, it shall notify the Indemnifying Party and, if reasonably requested by the Indemnifying Party and permissible under applicable law, the Taxed Party shall consider in good faith any request by the Indemnifying Party to assign such right to the Indemnifying Party.  Should the Taxed Party obtains a refund of all or any part of the Taxes paid by the Indemnifying Party, the Taxed Party shall pay the Indemnifying Party the amount of such refund, plus, any interest thereon (net of any taxes imposed on such interest) obtained by the Taxed Party from the taxing authority if fairly attributable to such Taxes.  

		
	(e)
	Cooperation.  Seller and Buyer shall reasonably cooperate so as to minimize any potential tax risk to Buyer or Seller as a result of the transactions contemplated hereby.  Seller and Buyer shall provide one another with such assistance as may reasonably be required in connection with the preparation of any tax return, any audit or other examination by any taxing authority, or any judicial or administrative proceedings relating to liability for Taxes arising from the transactions contemplated by this Agreement, and shall provide one another upon written request with any records or information that are relevant to such Tax return, audit or examination or proceedings.  The party requesting assistance, records or information under the preceding sentence shall reimburse the other for reasonable out-of-pocket expenses incurred by the other in providing such assistance, records or information.

		
	(f)
	Notice of Claims.  Seller and Buyer agree to provide written notification to the other party promptly after becoming aware of any liability, obligation or claim, whether pending or threatened, that is the subject of indemnification pursuant to this Section 12; unless the failure to provide such notification would not materially and adversely affect the Indemnifying Party in exercising its contest rights hereunder or result in any increase in, or fine or penalty with respect to, any amounts claimed to be payable by the Indemnifying Party to the other party pursuant to this Section 12, provided, that the failure by either party to so notify the other party will not in any manner affect either party’s other obligations under this Section 12.

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	(g)
	Insurance.  With respect to each airframe and engine, for a period of two years after the Delivery of the Aircraft, Buyer shall maintain, or procure that a subsequent buyer and/or operator maintain, an insurance policy(ies) for such asset providing $30,000,000 of aviation products liability coverage, except in the event that any airframe or engine is returned to service, in which event $600,000,000 of aviation general liability coverage shall be provided with respect to such airframe or engine. The Seller Indemnitees shall be named as additional insured parties for the two-year period referenced above.  Such policies shall include a Waiver of Subrogation Clause, Breach of Warranty Clause, and Severability of Interest Clause in favor of the Additional Insureds.  Buyer shall furnish an insurance certificate evidencing the same at Closing and, subsequently, upon any renewal or replacement thereof.

13.Know Your Customer
Seller and Buyer shall (i) ensure that no Person who owns a controlling interest in or otherwise controls Buyer or Seller is or shall be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign Assets Control (“OFAC”), the Department of the Treasury or included in any Executive Orders, (ii) not violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto, (iii) comply with all applicable Bank Secrecy Act laws and regulations, as amended or (iv) comply with any other applicable national sanctions program.  As required by federal law or other applicable law, Seller or Buyer may need to obtain, verify and record certain customer identification information and documentation in connection herewith, and each party hereto shall provide such information as is reasonably requested prior to Closing.
14.Ferry Flight
Seller shall provide ferry service to Buyer, and procure the existing operator to conduct a ferry flight of the Aircraft from Kunming, China to Marana, Arizona, U.S.A., all in accordance with the terms of the ferry flight agreement attached as Addendum B (the “Ferry Flight”).   Seller shall cause the subcontractor, China Eastern Airlines Corporation, Ltd., to perform the duties and obligations set forth in the Ferry Flight Agreement for the benefit of Buyer.
15.Post-Ferry Flight Obligations
Seller shall cause the existing operator of the Aircraft to deliver to Buyer at the time of the completion of the Ferry Flight the Aircraft records, including the following updated documents: (i) disk sheets (ii) Non-Incident or Accident Clearance Statement(s), as appropriate (iii) non PMA/DER statement(s), all in agreed upon form, (iv) completed log book entry page.  Notwithstanding Delivery of the Aircraft, Buyer shall retain all rights and remedies with respect to such obligations, provided that in no event shall Seller’s breach of such obligations affect or impair transfer of title to the Aircraft.  Seller further agrees to de-register or procure the existing operator of the Aircraft  to de-register  as soon as reasonably possible following completion of the Ferry Flight, and in no event later than  ten (10) Business Days  (or any other later days if mutually agreed by the parties) of the conclusion of the Ferry Flight. 

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16.Miscellaneous
(a)    Notices.  

All notices, demands, declarations and other communications required by this Agreement shall be in writing and shall be effective (i) if given by facsimile, when transmitted, (ii) if given by registered or certified mail, three Business Days after being deposited with the U.S. Postal Service or other commercially recognized carrier and (iii) if given by a nationally recognized overnight courier, when received, or, if personally delivered, when so delivered, addressed:
If to Seller, to:

XIAMEN LUFU AIRCRAFT LEASING CO., LTD.
Room 506, 5/F, Building A7, Central Park Plaza
No. 10 Chaoyang Park South Road,
Beijing, PRC
Attn: Jerry Duan
Chief Operating Officer
Fax: + 86 10 65398807
Email:  jerryduan@xmairlease.com

or to such other address as Seller shall from time to time designate in writing to Buyer; and
If to Buyer, to:    
CONTRAIL AVIATION LEASING, LLC 
435 Investment Court
Verona, Wisconsin  53593

Attn: Joseph G. Kuhn, CEO
Fax:  (608) 848-8100 
Email:  Joe@contrail.com

 
or to such other address as Buyer may from time to time designate in writing to Seller.
		
	(b)
	Confidentiality.

		
	(i)
	Each party hereto shall keep strictly confidential any and all Confidential Information furnished to it or to its Affiliates, or their respective officers, employees, agents, directors or advisers (collectively, “Representatives”) in the course of negotiations relating to this Agreement or any transaction contemplated by this Agreement, and the business and financial reviews and investigation conducted by any party hereto in connection with this Agreement, and each such party has instructed its Representatives having access to such Confidential Information of such obligation 

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of confidentiality. The obligations of confidentiality set forth herein shall not apply to information to the limited extent (v) it is contained in a Transfer Document that is publicly filed as contemplated hereby; (w) it is required to be disclosed by any Governmental Entity or applicable stock exchange or required to be disclosed by applicable law or administrative proceeding, (x) for which a party has received a subpoena or similar demand (provided that such party shall to the extent permitted by applicable law first, as promptly as practicable upon receipt of such subpoena or demand, furnish a copy thereof to the other party), (y) that such information is generally available to the public or in the possession of the receiving party before its disclosure by the disclosing party to the receiving party or (z) that it is given to the receiving party by another Person other than in breach of obligations of confidentiality owed by such Person to the disclosing party.  Notwithstanding the foregoing, each party acknowledges and agrees that any party may disclose Confidential Information to (A) regulators, (B) such party’s counsel, Affiliates, beneficiaries, hedging arrangement providers, insurance brokers and providers, reinsurers and auditors provided that such recipients maintain the confidentiality of the Confidential Information and (C) prospective transferees and lenders who agree to keep such Confidential Information confidential.  
		
	(ii)
	Notwithstanding anything herein to the contrary, any party to this Agreement (and any Representative) may disclose to any and all Persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure; provided, however, that such disclosure may not be made to the extent required to be kept confidential to comply with any applicable federal or state securities laws.

		
	(c)
	Limitation of Liability of Any Party.  THE PARTIES ACKNOWLEDGE AND AGREE THAT, NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY TO THIS AGREEMENT OR ASSERT A CLAIM FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, REGARDLESS OF THE NATURE OR THEORY OF ANY UNDERLYING CAUSE OF ACTION THAT MIGHT OTHERWISE APPLY. 

		
	(d)
	Headings.  Headings used herein are for convenience only and shall not in any way affect the construction of, or be taken into consideration in interpreting, this Agreement.

		
	(e)
	References.  Any reference to a specific Section or Section number shall be interpreted as a reference to that Section of this Agreement unless otherwise expressly provided.

		
	(f)
	Governing Law; Jurisdiction; Attorney Fees.  This Agreement and any other Transfer Documents shall in all respects be governed by, and construed in accordance with, the laws of England, including all matters of construction, validity and performance, without giving effect to principles of conflicts of law.  The courts located in London, England shall serve as the non-exclusive forum for any dispute between the parties irrevocably consent to the jurisdiction of such courts.  In the event of a dispute between the parties, and if not otherwise 

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provided by applicable law, the prevailing party shall be entitled to reasonable attorney fees and costs. 
		
	(g)
	Severability.  If any provision hereof should be held invalid, illegal or unenforceable in any respect in any jurisdiction, then, to the fullest extent permitted by law, (i) all other provisions hereof shall remain in full force and effect in such jurisdiction and shall be construed in order to carry out the intentions of the parties hereto as nearly as may be possible, and (ii) such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of such provision in any other jurisdiction.

		
	(h)
	Amendments in Writing.  No amendment, modification, waiver, termination or discharge of any provision of this Agreement, or any consent to any departure by Seller or Buyer from any provision hereof, shall in any event be effective unless the same shall be in writing and signed by Seller and Buyer, and each such amendment, modification, waiver, termination or discharge shall be effective only in the specific instance and for the specific purpose for which given.

		
	(i)
	Survival.  Notwithstanding anything contained herein to the contrary, all agreements, indemnities, representations and warranties contained in this Agreement shall survive the Closing Date and the consummation of the transactions contemplated hereby for such date.  

		
	(j)
	Expenses.  Each of Seller and Buyer shall be responsible for its own costs and expenses incurred in connection with the negotiation, preparation, execution and delivery of this Agreement and the Transfer Documents, and shall not have any right of reimbursement or indemnity for such costs and expenses as against the Buyer or Seller, respectively.  

		
	(k)
	Execution in Counterparts; Signatures.  This Agreement, the other Transfer Documents and any amendments, waivers or consents hereto or thereto may be executed by Seller and Buyer in separate counterparts (or upon separate signature pages bound together into one or more counterparts), each of which, when so executed and delivered, shall be an original, but all such counterparts shall together constitute one and the same instrument.  Facsimile and PDF copy signatures shall be treated as original signatures for all purposes.

		
	(l)
	Entire Agreement.  This Agreement and the other Transfer Documents constitute the entire agreement of Seller and Buyer with respect to the subject matter hereof or thereof, and all prior or contemporaneous understandings or agreements, whether written or oral, between Seller and Buyer with respect to such subject matter are hereby superseded in their entirety.  In the event of a conflict between this Agreement and any other Transfer Document, the terms and conditions of this Agreement shall govern.

		
	(m)
	Exhibits, Addendums, and Schedules.  The exhibits, addendums, and schedules attached hereto shall be considered integral parts of this Agreement.

		
	(n)
	Successors and Assigns.  This Agreement shall be binding upon, shall inure to the benefit of and shall be enforceable by Seller and Buyer, and their respective successors and assigns.

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	(o)
	No Third Party Benefit.  Seller and Buyer agree that except as provided in Section 12 with respect to Seller Indemnitees and Buyer Indemnitees, the provisions of this Agreement, including, without limitation, Section 2, are for the sole benefit of Seller and Buyer and their respective successors and assigns, and are not for the benefit, directly or indirectly, of any other Person.

		
	(p)
	Assignment.  Neither party shall assign or delegate this Agreement, or any of its rights or obligations hereunder, without the prior written consent of the other party.

SIGNATURE PAGE FOLLOWS

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IN WITNESS WHEREOF, the undersigned have caused this PURCHASE AGREEMENT to be duly executed as of the day and year first written above.
	
		
	 
	XIAMEN LUFU AIRCRAFT LEASING CO., LTD., as Seller 
 
 
By:  /s/ Duan Xiaoge_________________ 
Name:  Duan Xiaoge 
Title:    Legal Representative

	 
	CONTRAIL AVIATION LEASING, LLC, 
as Buyer 

By:  /s/ Joseph G. Kuhn_______________ 
Name: Joseph G. Kuhn
Title:   CEO

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SCHEDULE 1 
 
DEFINITIONS
(a)    Unless the context otherwise indicates, any reference in this Agreement to:
		
	(i)
	a “part” means any engine, module, component, instrument, furnishing, control, appliance, accessory, reverser, nacelle, equipment or other item or equipment of any kind whether similar to any of the foregoing or not;

		
	(ii)
	a “regulation” includes any applicable present or future governmental directive, regulation or legal requirement;

		
	(iii)
	any “agreement”, “license” or other document includes any agreement, license or other instrument as varied, novated, amended or replaced from time to time (but without prejudice to any restrictions on such variation, novation, amendment or replacement);

		
	(iv)
	the expressions “hereof”, “herein” and similar expressions shall be construed as references to this Agreement as a whole and shall not be limited to the particular clause in which the relevant expressions appear and the expressions “thereof”, “therein” and similar expressions shall be construed in like fashion;

		
	(v)
	references to any statute or other legislative provision shall be read to include any statutory or legislative modification or re-enactment thereof or any substitution therefor;

		
	(vi)
	references to a party shall be read to include its successors and permitted assigns;

		
	(vii)
	a Clause or Schedule shall be construed as a reference to a clause hereof or a schedule hereto;

		
	(viii)
	a word importing the singular number shall be construed so as to include the plural and vice versa;

		
	(ix)
	the expression “in writing” includes by facsimile or e-mail; and

		
	(x)
	the index, clause and sub-clause headings in this Agreement (including their use in cross references) are for ease of reference only and shall not affect the interpretation of this Agreement. 

(b)    In this Agreement, the following terms have the following meanings:
“Acknowledgment of Delivery” means the Acknowledgment of Delivery substantially in the form attached hereto as Exhibit A. 

Schedule 1
Page 1
    

“Affiliate” means, as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person or which owns, directly or indirectly, more than fifty percent of the outstanding equity interests of such Person.  A Person shall be deemed to control another Person if the controlling Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of the other Person, whether through the ownership of voting securities, by contract, or otherwise.
“Aircraft” means the Airframe, equipped with the Engines and other items of equipment installed in or attached thereto, and all Aircraft Documents related thereto.
“Aircraft Documents” means any aircraft documents associated with the Aircraft, including but not limited to those documents set out in Schedule 3 of this Agreement; the parties will work together cooperatively and in good faith to resolve any issues related to such documents.
“Airframe” means that certain Boeing 737-700 airframe more specifically described on Schedule 2.
“Anticipated Closing Date” means the date for anticipated Closing for the Aircraft as designated on Schedule 2.

“Bill of Sale” means the bill of sale for the Aircraft, in the form of Exhibit C hereto for the Aircraft.

“Business Day” means any day, other than a Saturday or Sunday, on which banks in Chicago, Illinois, U.S.A. and Kunming, China, Xiamen, China are open for business.
“Buyer Agreements” has the meaning ascribed in Section 7(a) hereof.
“Buyer Indemnitee” means Buyer and any Buyer’s Affiliates, members, managers, officers, directors, employees, successors and assigns.
“Certificate of Technical Acceptance” means the Certificate of Technical Acceptance in the form attached hereto as Exhibit B.
“China” means, for the purposes of the Transfer Documents, the People’s Republic of China (excluding Hong Kong Special Administrative Region, Macau Administration Region and the Taiwan region.
“Closing” means the closing of the sale and purchase of the Aircraft pursuant to this Agreement on the Closing Date.
“Closing Date” means the date on which Closing occurs.  
“Confidential Information” means any and all information, whether written, in electronic form, or oral concerning or relating in any way to the Aircraft, which is provided by a party hereto or such party’s Affiliates or representatives to the other party hereto or such party’s Affiliates or representatives, and includes, without limitation, all agreements, analyses, compilations, forecasts, 

Schedule 1
Page 2
    

studies, capabilities, specifications, program plans, marketing plans, e-commerce strategies, inspection reports, certificates of insurance or other documents which contain or otherwise reflect such information, or any portion thereof or notes or other documents which contain or reflect such information, whether or not marked or specifically identified as “confidential” or “proprietary.”
“Delivery” means the delivery of the Aircraft from Seller to Buyer in accordance with this Agreement.
“Delivery Location” means a location over international waters during the Ferry Flight agreed upon by the parties, or such other location as may be mutually agreed in writing by the parties.
“Deposit” has the meaning set forth in Section 3 hereof.
“Engines” means those CFM56-7B22 aircraft engines including all parts, components, appliances, accessories, instruments, furnishings, alterations thereto whether or not attached to the Airframe on the Closing Date as more specifically described on Schedule 2.
“Event of Loss” means any of the following events with respect to the Aircraft, including, but not limited to, the Aircraft, the Airframe or any Engine or engine installed on the Airframe: (a) loss of such property or its use due to theft, hijacking or disappearance for a period in excess of sixty (60) consecutive days, or in any event extending beyond the Final Delivery Date, or destruction, damage beyond economic repair or rendition of such property permanently unfit for normal use for any reason whatsoever, (b) any damage to such property which results in an insurance settlement with respect to such property on the basis of a total loss or on the basis of a compromised or constructive total loss, (c) the condemnation, confiscation, appropriation or seizure of, or requisition of title to, such property by a governmental entity or purported governmental entity, (d) the condemnation, confiscation, appropriation or seizure of the use of such property by or on behalf of the authority of any governmental entity or purported governmental entity, that in any such case shall have resulted in the loss of possession thereof for a period in excess of sixty (60) consecutive days or in any event extending beyond the Final Delivery Date or (e) any divestiture of title of such property except as otherwise permitted by the other party. 

“Ferry Flight” has the meaning set forth in Section 14 hereof.

“Ferry Flight Agreement” means the ferry flight agreement attached as Addendum B entered into or to be entered into between Seller and Buyer, it being understood that Seller will subcontract for the Ferry Flight on substantially the same terms with China Eastern Airlines to ferry the Aircraft to U.S.A.

“Final Delivery Date” means July 31, 2020 unless a later date is mutually agreed by Seller and Buyer in writing.

“Government Entity” means any (i) nation, state, county, city, town, village, district, or other jurisdiction of any nature; (ii) federal, state, local, municipal, foreign, or other government; (iii) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal); (iv) multinational 

Schedule 1
Page 3
    

organization or body; or (v) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, regulatory, or taxing authority or power of any nature.
“Inspection” has the meaning set forth in Section 4 hereof.
“International Registry” means the International Registry of Mobile Assets established pursuant to the Convention on International Interests in Mobile Equipment and its Protocol on Matters Specific to Aircraft Equipment, concluded in Cape Town on November 16, 2001.
“Liens” means any pledge, lien, charge, encumbrance, mortgage, exercise of rights, security interest or claim of any kind or nature.
“Material Damage” has the meaning set forth in Section 3 hereof.
“OFAC” has the meaning set forth in Section 13 hereof.  
"Permitted Liens" means any Liens created by or through or resulting from debts or liabilities or actions of Buyer or any third party designated or nominated by Buyer.
“Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Government Entity or other entity of whatever nature.
“Purchase Agreement MSN 30075” means the Purchase Agreement dated on or about hereof in respect of one (1) Boeing 737-700 aircraft bearing manufacturer’s serial number 30075 between Seller and Buyer.   
“Purchase Price” has the meaning set forth in Section 3 hereof.  
“Seller Agreements” has the meaning ascribed to such term in Section 5(a) hereof.
“Seller Indemnitee” means Xiamen Lufu Aircraft Leasing Co., Ltd. and any Affiliates, the members, managers, officers, directors, employees, successors and assigns and any of its financier. 
“Taxes” means and includes all present and future income, gains, sales, stamp, documentary, use, value-added, goods and services and other taxes, duties, imposts, levies, deductions, charges and withholdings imposed by any Government Entity and also includes all fines, penalties and interest thereon, and the terms “Tax” and “Taxation” shall be construed accordingly.  

Schedule 1
Page 4
    

“Transfer Documents” means this Agreement, the Ferry Flight Agreement, the Bill of Sale, the Acknowledgments of Delivery, the Certificates of Technical Acceptance and any other agreements, documents, certificates and instruments executed and delivered in connection herewith. 
.

Schedule 1
Page 5
    

SCHEDULE 2
AIRCRAFT DESCRIPTION; INITIAL PURCHASE PRICE

	
								
	MSN
	Chinese Registration Mark
	Engine Make and Model
	ESNs
	Initial Purchase Price
	Deposit
	Anticipated Closing Date
	Final 
Delivery
Date

	30074
	B-2503
	CFM56-7B22
	890244
874445
	$[         ]
	$[       ]
	May 15, 2020
	July 31, 2020

Schedule 2
Page 1
    

SCHEDULE 3
AIRCRAFT DOCUMENTS
1.    Manuals (Current to Latest Revision)    
		
	•
	Aircraft Maintenance Manual

		
	•
	Illustrated Parts Catalog

		
	•
	Power Plant Build Up Manual

(If Available – Below Items)
		
	•
	Engine Illustrated Parts Catalog

		
	•
	Engine Manual

2.    Airframe Records (All statements and reports are to be current and certified with airline name, signed and dated from airlines representative)

		
	•
	Airframe current total time / cycle

		
	•
	Non incident / accident statement from the operator (per ICAO request)

		
	•
	Life limited parts status (including airframe life limit) with backup documentation from OEM, full back to birth and non incident / accident statement (Acceptable for landing gear LLP lacking BTB traceability)

		
	•
	Hard time component list (to include PN, SN, description, position, date installed)

		
	•
	Hard time components (FAA 8130-3 or EASA Form 1 or CAAC 038 or CEA serviceable tag, or equivalent for each component)

		
	•
	Avionics inventory list

		
	•
	LOPA

		
	•
	OC/CM component listing with FAA 8130-3 or EASA Form 1, or CAAC 038 or CEA serviceable tag, or equivalent for each part replaced in the last 2 years

		
	•
	Current AD status

		
	•
	Current SB status, modification status

		
	•
	AD compliance dirty finger prints and AMOC’s granted if applicable

		
	•
	Aircraft tech logbook and aircraft flight logbook for last 24 month

		
	•
	Original manufacturer’s delivery data

		
	•
	Last A, C, D/SI (equivalent, if applicable) work packages

		
	•
	Last done and next due maintenance reports (including all MPD, non-MPD, CPCP, SSI and ETOPS tasks last completed)

		
	•
	Last thrust reverser overhaul shop report (if available)

		
	•
	Last fan and nose cowls shop report (if available)

3.    Engines (All statements and reports are to be current and certified with airline name, signed, and dated from airlines representative)

		
	•
	Engine current total time / cycle

		
	•
	Total TSLSV / CSLSV and for each module

Schedule 3

		
	•
	Engine disk sheet to include the standard duty cycle remaining calculation for each applicable LLP

		
	•
	Non incident / accident statement from the operator (per ICAO request)

		
	•
	Statement to confirm that no non-OEM repair, no DER repair, no PMA

		
	•
	Status of any non MPD repetitive inspections

		
	•
	ETOPS statement and configuration compliance documentation (if applicable)

		
	•
	Engine performance and trend monitoring incorporating engine take off performance reports from last six months, engine EGT margin trends, engine vibration trend levels, and engine shaft speed trend levels

		
	•
	Life limited parts back to birth trace for each part, including backup documentation from OEM, Engine disk sheets for LLP replacement, and non incident / accident statement

		
	•
	OEM engine documentation including certificates such as the build Form 1, AD status, SB status, all module build packages (if applicable)

		
	•
	Engine logbook or engine history report including aircraft registration, position, date of installation / removal or on-wing event, aircraft hours and cycles corresponding with the engine hours and cycles, thrust, reason for removal

		
	•
	Current data plate – Thrust

		
	•
	Engine current AD status signed 

		
	•
	Engine current SB status signed 

		
	•
	Minipacks for all engine shop visits, if available, to include (FAA 8130-3 or EASA Form 1 or equivalent, AD status, SB status, LLP status, technical variances, QEC, test cell data and borescope report, if applicable)

		
	•
	Dirty fingerprint records for the shop visits of the last performance restoration of each module, if available

		
	•
	Current borescope report (video)

		
	•
	Engine QEC listing, with FAA 8130-3, EASA Form 1 or CAAC 038 or CEA service tag or equivalent for all QEC components installed on the engine

    
4.    Landing Gears (All statements and reports are to be current and certified with airline name, signed, and dated from airlines representative)

		
	•
	Landing gear assembly current total time / cycle, TSO / CSO

		
	•
	Current life limited parts status report

		
	•
	Life limited parts back to birth with backup documentation from OEM, full back to birth and non incident / accident statement (Acceptable for landing gear LLP lacking BTB traceability)

		
	•
	Latest complete OH shop visit report

5. APU (All statements and reports are to be current and certified with airline name, signed, and dated from Airlines Representative)

		
	•
	APU current total time / cycle

		
	•
	Current life limited parts status report 

Schedule 3

		
	•
	Life limited parts back to birth with backup documentation from OEM, full back to birth and non incident / accident statement

		
	•
	Statement to confirm that no non-OEM repair, no DER repair, no PMA

		
	•
	Latest AD / SB modification status

		
	•
	Logbook

		
	•
	Total TSLSV / CSLSV

		
	•
	Complete copy of the last shop visit report

		
	•
	Total time / cycle since overhaul

		
	•
	Historical shop visit reports from last hot section refurbishment

6.    Airframe Manufacturer Original Delivery Documents

		
	•
	Readiness Log

		
	•
	AD Compliance 

		
	•
	Landing Gear Life Limited Parts

		
	•
	Miscellaneous Log

		
	•
	Details Specifications

Schedule 3

EXHIBIT A
FORM OF ACKNOWLEDGMENT OF DELIVERY 

____________, 2020

By this Acknowledgment of Delivery, Xiamen Lufu Aircraft Leasing Co., Ltd. (the “Seller”), and Contrail Aviation Leasing, LLC (the “Buyer”), acknowledge that pursuant to that certain Purchase Agreement dated as of January ___, 2020, among Seller and Buyer, (the “Agreement”), Seller does hereby deliver to Buyer and Buyer does hereby accept the following in all respects under the Agreement:

One Boeing model 737-700 aircraft bearing manufacturer’s serial number 30074 and equipped with two CFM56-7B22 aircraft engines bearing manufacturer’s serial numbers  890244 and 874445, including all parts, components, appliances, accessories, instruments, furnishings, alterations and other items of equipment installed in or attached thereto, and all Aircraft Documents related thereto (collectively the “Aircraft”).

Buyer has accepted delivery of the Aircraft at ____ hours G.M.T. at [delivery location].  Accordingly, as of the date hereof, Seller has delivered the Aircraft to Buyer and that the Closing Date as defined and set forth in the Agreement has occurred.  Buyer hereby declares that the Aircraft is acceptable and does conform to the Agreement in all respects.  The execution and delivery of this Acknowledgment of Delivery by Buyer is conclusive proof and confirms the unconditional and irrevocable acceptance of the Aircraft by Buyer for all purposes of the Agreement.
This Acknowledgment of Delivery may be signed in one or more counterparts with the same effect as if the signatures to each counterpart were upon a single instrument.  All counterparts shall, taken together, be considered an original of this Acknowledgment of Delivery.  All capitalized terms used herein not otherwise defined shall have the same meaning as that given in the Agreement.

[Signature page follows.]

Exhibit A

IN WITNESS WHEREOF, the undersigned have duly executed this Acknowledgment of Delivery as of the date first written above.

Xiamen Lufu Aircraft Leasing Co., Ltd. (Seller)  
 
By:    ___________________________ 
Name:    ___________________________ 
Title:    ___________________________

Contrail Aviation Leasing, LLC (Buyer)
 
By:    ___________________________ 
Name:    ___________________________ 
Title:    ___________________________

Exhibit A

EXHIBIT B
 
FORM OF CERTIFICATE OF TECHNICAL ACCEPTANCE
relating to that Boeing 737-700 Aircraft,
manufacturer's serial number 30074 (the "Aircraft")

______________, 2020

This Certificate of Technical Acceptance (this “Certificate”) is delivered on the date set out below by Contrail Aviation Leasing, LLC (“Buyer”), to Xiamen Lufu Aircraft Leasing Co., Ltd. (“Seller”), pursuant to that certain Purchase Agreement dated January ___, 2020 between Buyer and Seller (the “Agreement”).  The capitalized terms used in this Certificate shall have the meaning given to such terms in the Agreement.

		
	(a) 
	Buyer has inspected the Aircraft in accordance with the provisions of Section 4 of the Agreement at [insert inspection location] and the Aircraft and found the physical condition of the Aircraft to be satisfactory in all respects; 

		
	(b) 
	Buyer has received and inspected all of the Aircraft Documents and found them to be complete and satisfactory in all respects; and

(c)   the execution and delivery of this Certificate of Technical Acceptance confirms the unconditional and irrevocable technical acceptance of the Aircraft by Buyer for all purpose of the Agreement.

IN WITNESS WHEREOF, Buyer has, by its duly authorized representative, executed this Certificate on the date first written above, accepted the Aircraft and confirmed its compliance with the Agreement in all respects.

Contrail Aviation Leasing, LLC (Buyer) 

By:    ___________________________ 
Name:    ___________________________ 
Title:    ___________________________

Exhibit B

EXHIBIT C
FORM OF BILL OF SALE
relating to that Boeing 737-700 Aircraft,
manufacturer's serial number 30074

_________________, 2020

KNOW ALL MEN BY THESE PRESENTS:
    
THAT for and in consideration of good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, Xiamen Lufu Aircraft Leasing Co., Ltd. (“Seller”) does, on the date hereof, grant, convey, transfer, bargain, sell, deliver and set over to Contrail Aviation Leasing, LLC (“Buyer”), all of Seller’s right, title and interest in and to the one Boeing 737-700 aircraft bearing manufacturer’s serial number 30074, equipped with two CFM56-7B22 aircraft engines bearing manufacturer’s serial numbers 890244 and 874445, including all parts, components, appliances, accessories, instruments, furnishings, alterations and other items of equipment installed in or attached thereto, and all Aircraft Documents related thereto (collectively the “Aircraft”).  Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in that certain Purchase Agreement dated as of January ___, 2020, among Seller and Buyer (the “Agreement”).

TO HAVE AND TO HOLD said Aircraft unto Buyer, its successors and assigns, for its and their own use forever.

THAT Seller hereby warrants to Buyer, its successors and assigns, that it is the holder of title to the Aircraft and has the right to sell the same as aforesaid and that this Bill of Sale conveys to Buyer on the date hereof, good title to the Aircraft, free and clear of all Liens (other than any Permitted Liens), encumbrances and rights of others, and that Seller will warrant and defend such title forever against all claims and demands whatsoever.

This Bill of Sale shall be governed by the laws of England, without giving effect to its conflicts-of-laws principles.

IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be executed by its duly authorized officers as of the date first written above.

Xiamen Lufu Aircraft Leasing Co., Ltd. (Seller)  

 
By:    ___________________________ 
Name:    ___________________________ 
Title:    ___________________________

Exhibit C

EXHIBIT D
GUARANTEE 
This guarantee dated as of January 22, 2020, (the “Guarantee”), of XIAMEN AIRCRAFT LEASING CO., LTD., a company organized under the laws of the People’s Republic of China (“Guarantor”) is given in favor of CONTRAIL AVIATION LEASING, LLC, a Wisconsin limited liability company organized under the laws of Wisconsin (“Buyer”). 
WHEREAS, Buyer and Xiamen Lufu Aircraft Leasing Co., Ltd., (“Seller”) have entered into a Purchase Agreement dated January 22, 2020 (“PA”) for one (1) Boeing 737-700 aircraft bearing manufacturer’s serial number 30074 equipped with two CFM56-7B22 aircraft engines bearing manufacturer’s serial numbers 890244 and 874445 and Ferry Flight Agreement (“FFA”) (collectively, the “Agreements”);

WHEREAS, as a condition of Buyer entering into the Agreements, Guarantor has agreed to provide this Guarantee.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties, Guarantor hereby agrees as follows:
1.  Definitions.  For purposes of this Guarantee, unless otherwise defined herein or unless the context otherwise requires, all terms used herein which are defined in the PA shall have the respective meanings given to them in such document.
2.  Guarantee.  Guarantor hereby absolutely and unconditionally guarantees to Buyer that Guarantor shall ensure the timely performance of: a) all of Seller’s obligations under the PA relating to indemnification, insurance, return of Deposit, the FFA, and warranty of title; and, b) all of Seller’s obligations under the FFA (collectively, the “Guaranteed Obligations”).  
Guarantor agrees that its obligations hereunder shall not be limited, altered, modified or impaired in any way, by any change in or amendment to the PA or FFA, the absence of any action to enforce the same, any waiver or consent by the Buyer with respect to any provision thereof (unless in writing), or any other action, omission or occurrence or circumstance whatsoever (other than performance in full of any such obligation).  This Guarantee is in no way conditioned or contingent upon any obligation of Buyer to first seek performance by Seller or to provide notice of any kind to Guarantor.  Guarantor covenants that this Guarantee will not be discharged except by complete performance of the obligations contained in this Guarantee or by Seller’s complete satisfaction of all of its obligations under the PA and FFA.
3.  Notices.  All notices and other communications under, or in connection with, this Guarantee will, unless otherwise stated, be sent to the parties at the addresses noted below:

Exhibit D

The notice details of Guarantor are as follows: 
	
		
	Address:
	Xiamen Lufu Aircraft Leasing Co., Ltd.
Room 506, 5/F, Building A7, Central Park Plaza
No. 10 Chaoyang Park South Road,
Beijing, PRC

	Attention:
	Jerry Duan, Chief Operating Officer

The notice details of Buyer are as follows: 
	
		
	Address:
	Contrail Aviation Leasing, LLC
435 Investment Court 
Verona, WI 53593

	Attention:
	Joseph G. Kuhn, CEO

4.  Governing Law.  THIS GUARANTEE AND ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS GUARANTEE OR THE RELATIONSHIP ESTABLISHED HEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF ENGLAND APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH JURISDICTION WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
5.  Choice of Law; Consent to Jurisdiction; Attorney Fees.  This Agreement and any related documents shall in all respects be governed by and construed in accordance with the laws of England, including all matters of construction, validity and performance, without giving effect to principles of conflicts of law.  The courts located in London, England shall serve as the non-exclusive forum for any dispute between the parties, and the parties irrevocably consent to the jurisdiction of such courts.  In the event of a dispute between the parties, and if not otherwise provided by applicable law, the prevailing party shall be entitled to reasonable attorney fees and costs.
6.  Enforcement of Judgment.  Each of Guarantor and Buyer agrees that final judgment against such party in any action or proceeding in connection with this Guarantee shall be conclusive and may be enforced in any other jurisdiction within or outside of England by suit on the judgment, a certified or exemplified copy of which shall be conclusive evidence of same, subject to any restrictions under the applicable law..    
7.  Waiver of Jury Trial.  each of guarantor and buyer hereby waives trial by jury in any judicial proceeding to which it is a party involving, directly or indirectly, any matter (whether sounding in tort, contract or otherwise) in any way arising out of, related to, or connected with this guarantee or the relationship established hereunder.

Exhibit D

8.  Waiver of Provisions by Guarantor or Buyer.  No waiver of any provision of this Agreement shall be effective unless in writing and executed by the party against whom such waiver is to be effective, and any such waiver shall affect only the matter specifically identified therein and shall not extend to any other matter.  
9.  Headings.  All section and paragraph headings and captions are purely for convenience and will not affect the interpretation of this Guarantee.  Any reference to a specific section or paragraph will be interpreted as a reference to such section or paragraph of this Guarantee.
10.  Invalidity of any Provision.  If any of the provisions of this Guarantee become invalid, illegal or unenforceable in any respect under any law, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired.
11.  Assignment.  This Agreement will be binding upon and inure to the benefit of each party hereto and its respective successors and assigns, provided that no assignment of guarantee obligations hereunder may be made without Buyer’s advance written consent.

[Signature Page Follows]

Exhibit D

	
		
	

	Acknowledged and agreed:
XIAMEN AIRCRAFT LEASING CO., LTD., as Guarantor 
 
 
By:   /s/ Duan Xiaoge__  
   Name: Duan Xiaoge  
   Title:  Attorney-in-fact

	 
	CONTRAIL AVIATION LEASING, LLC, as Buyer  
 
 
By:   /s/Joseph G. Kuhn    
   Name:  Joseph G. Kuhn 
   Title:    CEO

Exhibit D

	
		
	Addendum A
Delivery Conditions

	General Condition:
	Provided that the Aircraft has met the requirements set forth in this Addendum A, the Aircraft shall be delivered in “As is, Where is” condition and in compliance with CAAC requirements. The Aircraft shall be in a physical condition for continued commercial service for at least twenty-five (25) cycles.

	Airframe:
	As is, Where is

	Engines:
	1. The Engines shall each have not less than twenty-five (25) cycles of operation remaining until next core heavy maintenance/core gas path restoration.
2. Each LLP shall have at least twenty-five (25) cycles remaining until life expiration.
3. The Engines will have no on watch item(s), which is less than twenty-five (25) cycles allowed for any limitations or repeat inspections.

	Landing Gear:
	1. The landing gear shall have at least 25 cycles remaining as per MPD.
2. Brakes, wheels and tires shall have no more than 50% of their tread and useful life consumed.
3. Acceptable for landing gear LLP lacking BTB traceability.

	APU:
	APU shall be in a serviceable condition

	Livery:
	Current operator livery

	Airworthiness Directives
	Comply with AD (CAAC) as the Delivery Date.

Addendum A

	
		
	Repairs:
	1. All repairs shall have a re-inspection interval of no less than twenty-five (25) cycles remaining.
2. All in accordance with SRM or manufacturer, FAA DER approval.
3. In the event that there is no FAA 8100-9 or 8110-3 forms, or RDR, a letter from operator’s quality assurance manager stating “Operator repair was incorporated without deviation” will suffice.

	Components:
	OCCM components installed is within two (2) years before delivery, and all HT components shall have EASA form 1, or FAA 8130-3, or CAAC-038 or operator’s serviceable tags

	Others Conditions:
	No demo flight will be performed.
The results of Buyer’s Inspection, as defined in the Agreement, must be satisfactory to Buyer in its sole discretion, acting in good faith; provided, however, that the verification of the conditions set forth above shall be deemed satisfactory with respect to such conditions.

Addendum A

ADDENDUM B

FERRY FLIGHT AGREEMENT

18615800v1

Addendum B

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