Document:

exv10w1

 

Exhibit 10.1

ASSET PURCHASE AGREEMENT 

     THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of February 20, 2007 among Emmis
Television Broadcasting, L.P., an Indiana limited partnership, and Emmis Television License, LLC,
an Indiana limited liability company (collectively, “Seller”), Emmis Operating Company, an Indiana
corporation (“Guarantor”), HITV Operating Co., Inc. (“Buyer”) and MCG Capital Corporation, a
Delaware corporation (“MCG”).

Recitals

     A. Seller owns and operates the following television broadcast stations (collectively, the
“Station”) pursuant to certain authorizations issued by the Federal Communications Commission (the
“FCC”):

KGMB(TV), Honolulu, Hawaii

KGMV(TV), Wailuku, Hawaii

KGMD-TV, Hilo, Hawaii

     B. Pursuant to the terms and subject to the conditions set forth in this Agreement, Seller
desires to sell to Buyer, and Buyer desires to purchase from Seller, the Station Assets (defined
below).

Agreement

     NOW, THEREFORE, taking the foregoing into account, and in consideration of the mutual
covenants and agreements set forth herein, the sufficiency of which are hereby acknowledged, the
parties, intending to be legally bound, hereby agree as follows:

ARTICLE 1: PURCHASE OF ASSETS

     1.1. Station Assets. On the terms and subject to the conditions hereof, at Closing
(defined below), except as set forth in Sections 1.2 and 1.3, Seller shall sell, assign, transfer,
convey and deliver to Buyer, and Buyer shall purchase and acquire from Seller, all right, title and
interest of Seller in and to all assets and properties of Seller, real and personal, tangible and
intangible, that are used or held for use in the operation of the Station (collectively, the
“Station Assets”), in each case free and clear of all liens, claims, encumbrances, mortgages, deeds
of trust, pledges, hypothecations, security interests, capitalized leases, conditional sale or
other title retention agreements, or charges of any kind, whether voluntarily incurred or arising
by operation of law or otherwise (collectively, “Liens”) other than Permitted Liens (defined
below), including without limitation the following:

          (a) all licenses, permits and other authorizations issued to Seller by the FCC with respect to
the Station (the “FCC Licenses”), including those described on Schedule 1.1(a), including any
renewals, additions, extensions or modifications thereof between the date hereof and Closing as
permitted by this Agreement, together with all other governmental licenses, permits and regulatory
approvals issued with respect to the Station, and all assignable

 

 

applications for modification, extension or renewal of the FCC Licenses and any assignable
pending applications with respect to the Station;

          (b) all of Seller’s machinery, equipment, transmitters, antennas, cables, towers, vehicles,
furniture, fixtures, spare parts and other tangible personal property of every kind and description
that are used or held for use in the operation of the Station, including without limitation those
listed on Schedule 1.1(b), except for any retirements or dispositions thereof made between the date
hereof and Closing in the ordinary course of business in accordance with Article 4 (the “Tangible
Personal Property”);

          (c) all of Seller’s real property, including all fee estates, leasehold interests and estates,
easements, real property licenses, rights to access, rights of way and other interests in real
property of every kind and description used or held for use in the operation of the Station
(including any appurtenant easements, structures and improvements located thereon), including
without limitation those listed on Schedule 1.1(c) (the “Real Property”);

          (d) all agreements for the sale of advertising time on the Station, and all other contracts,
agreements and leases used in the Station’s business, including without limitation those listed on
Schedule 1.1(d), together with all contracts, agreements and leases made between the date hereof
and Closing in accordance with Article 4 (each a “Station Contract” and, collectively, the “Station
Contracts”);

          (e) all of Seller’s rights in and to the Station’s call letters and Seller’s rights in and to
the trademarks, trade names, service marks, internet domain names, copyrights, programs and
programming material, jingles, slogans, logos, and other intangible property which are used or held
for use in the operation of the Station, including without limitation those listed on Schedule
1.1(e) (the “Intangible Property”); and

          (f) Seller’s rights in and to all the files, documents, records, and books of account (or
copies thereof) relating to the operation of the Station, including the Station’s local public
files, programming information and studies, engineering data, advertising studies, marketing and
demographic data, sales correspondence, lists of advertisers, credit and sales reports, logs, and
(except as prohibited by applicable law) personnel files, but excluding records relating to
Excluded Assets (defined below).

     1.2. Excluded Assets. Notwithstanding anything to the contrary contained herein, the
Station Assets shall not include the following assets or any rights, title and interest therein
(the “Excluded Assets”):

          (a) all cash and cash equivalents of Seller, including without limitation certificates of
deposit, commercial paper, treasury bills, marketable securities, money market accounts and all
such similar accounts or investments;

          (b) all tangible and intangible personal property of Seller retired or disposed of between the
date of this Agreement and Closing in accordance with Article 4;

          (c) all Station Contracts that are terminated or expire prior to Closing in accordance with
Article 4;

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          (d) Seller’s corporate and trade names unrelated to the operation of the Station (including
the name “Emmis”), charter documents, and books and records relating to the organization, existence
or ownership of Seller, duplicate copies of the records of the Station, and all records not
relating to the operation of the Station;

          (e) all contracts of insurance, all coverages and proceeds thereunder and all rights in
connection therewith, including without limitation rights arising from any refunds due with respect
to insurance premium payments to the extent related to such insurance policies;

          (f) all pension, profit sharing plans and trusts and the assets thereof and any other employee
benefit plan or arrangement and the assets thereof, if any, maintained by Seller;

          (g) the Station’s accounts receivable and any other rights to payment of cash consideration
(including without limitation all rights to payments under the Station’s network affiliation
agreement, whether or not offset) for goods or services sold or provided prior to the Effective
Time (defined below) or otherwise attributable to any period prior to the Effective Time (the
“A/R”);

          (h) all rights and claims of Seller, whether mature, contingent or otherwise, against third
parties with respect to the Station and the Station Assets, to the extent attributable to any
period prior to the Effective Time;

          (i) all deposits and prepaid expenses (and rights arising therefrom or related thereto),
except to the extent Seller receives a credit therefor under Section 1.7;

          (j) all claims of Seller with respect to any tax refunds attributable to the period prior to
the Effective Time;

          (k) computers and other assets located at the Emmis Communications Corporation headquarters,
and the centralized server facility, data links, payroll system and other operating systems and
related assets that are used in the operation of multiple stations;

          (l) any non-transferable shrinkwrapped computer software and any other non-transferable
computer licenses that are not material to the operation of the Station;

          (m) all claims of Seller for reimbursement of expenses incurred prior to Closing in connection
with the Sprint Nextel 2GHz relocation project; and

          (n) the assets listed on Schedule 1.2, and the slogan “Great Media, Great People, Great
Service”.

     1.3. Shared Assets.

          (a) Some of the Station Contracts may be used in the operation of multiple stations or other
business units (the “Shared Contracts”) and are identified as such on Schedule 1.1(d). The rights
and obligations under the Shared Contracts shall be equitably allocated among stations in a manner
reasonably determined by Seller in accordance with the following equitable allocation principles:

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               (i) any allocation set forth in the Shared Contract shall control;

               (ii) if none, then any allocation previously made by Seller in the ordinary course of Station
operations shall control;

               (iii) if none, then the quantifiable proportionate benefit to be received by the parties after
Closing shall control; and

               (iv) if not quantifiable, then reasonable accommodation shall control.

          (b) Buyer shall cooperate with Seller (and any third party designated by Seller) in such
allocation, and the Station Contracts (and Assumed Obligations (defined below)) will include only
Buyer’s allocated portion of the rights and obligations under the Shared Contracts (without need
for further action and whether such allocation occurs before or after Closing). If designated by
Seller, such allocation will occur by termination of the Shared Contract and execution of new
contracts. Buyer’s allocated portion of the Shared Contracts will not include any group discounts
or similar benefits specific to Seller or its affiliates. Completion of documentation of any such
allocation is not a condition to Closing.

     1.4. Assumption of Obligations. At the Closing (defined below), Buyer shall assume
the obligations of Seller attributable to any period of time on or after the Closing under the
Station Contracts and the FCC Licenses, the obligations to be assumed by Buyer pursuant to Section
5.7 and any other liabilities of Seller to the extent Buyer receives a credit therefor under
Section 1.7 (collectively, the “Assumed Obligations”). Except for the Assumed Obligations, Buyer
does not assume, and will not be deemed by the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby or otherwise to have assumed, any other
liabilities or obligations of Seller (the “Retained Obligations”).

     1.5. Purchase Price. In consideration for the sale of the Station Assets to Buyer, at
Closing Buyer shall pay Seller by wire transfer of immediately available funds the sum of Forty
Million Dollars ($40,000,000), subject to adjustment pursuant to Section 1.7 (the “Purchase
Price”).

     1.6. [Intentionally Omitted].

     1.7. Prorations and Adjustments.

          (a) All prepaid and deferred revenue and expenses relating to the Station Assets and arising
from the operation of the Station shall be prorated between Buyer and Seller in accordance with
accounting principles generally accepted in the United States, consistently applied (“GAAP”) as of
12:01 a.m. on the day of Closing (the “Effective Time”) in accordance with the principle that
Seller will be allocated such revenues, expenses, costs and liabilities attributable to the
operation of the Station prior to the Effective Time, and Buyer will be allocated such revenues,
expenses, costs and liabilities attributable to the operation of the Station after the Effective
Time. Such prorations shall include without limitation all ad valorem, real estate and other
property taxes (except transfer taxes as provided by Section 11.1), music and other license fees,
employee performance incentives set forth in employment agreements or annual compensation plans,
any vacation for Transferred Employees (defined below) (except accruals for the fiscal year of
Seller in which Closing occurs for which there shall be no

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adjustment), utility expenses, rent and other amounts under Station Contracts and similar
prepaid and deferred items. Seller shall receive a credit for all of the Station’s deposits and
prepaid expenses. Sales commissions related to the sale of advertisements broadcast on the Station
prior to the Effective Time shall be the responsibility of Seller, and sales commissions related to
the sale of advertisements broadcast on the Station after the Effective Time shall be the
responsibility of Buyer.

          (b) With respect to trade, barter or similar agreements for the sale of time for goods or
services assumed by Buyer pursuant to Section 1.1(d), if as of the Effective Time the Station has
an aggregate negative or positive barter balance (i.e., the amount by which the value of air time
to be provided by the Station after the Effective Time exceeds, or conversely, is less than, the
fair market value of corresponding goods and services), there shall be no proration or adjustment,
unless the negative or positive barter balance of the Station as an aggregate exceeds $25,000, in
which event such excess or deficiency over $25,000 only, as the case may be, shall be treated
either as prepaid time sales or a receivable of Seller, and adjusted for as a proration in Buyer’s
or Seller’s favor, as applicable. In determining barter balances, the value of air time shall be
based upon Seller’s standard rates as of the Effective Time, and corresponding goods and services
shall include those to be received by the Station after the Effective Time plus those received by
the Station before the Effective Time to the extent conveyed by Seller to Buyer as a part of the
Station Assets.

          (c) No later than three (3) business days prior to the scheduled Closing Date, Seller shall
provide Buyer with a statement setting forth a reasonably detailed computation of Seller’s
reasonable and good faith estimate of the Adjustment Amount (defined below) as of the Effective
Time (the “Preliminary Adjustment Report”). As used herein, the “Adjustment Amount” means the net
amount by which the Purchase Price is to be increased or decreased in accordance with this Section
1.7. If the Adjustment Amount reflected on the Preliminary Adjustment Report is a credit to Buyer,
then the Purchase Price payable at Closing shall be reduced by the amount of such Adjustment
Amount, and if the Adjustment Amount reflected on the Preliminary Adjustment Report is a charge to
Buyer, then the Purchase Price payable at Closing shall be increased by the amount of such
Adjustment Amount. For a period of ninety (90) days after Closing, Seller and its auditors and
Buyer and its auditors may review the Preliminary Adjustment Report and the related books and
records of Seller with respect to the Station, and Buyer and Seller will in good faith seek to
reach agreement on the final Adjustment Amount. If agreement in writing between Buyer and Seller
is reached within such 90-day period, then promptly thereafter Seller shall pay to Buyer or Buyer
shall pay to Seller, as the case may be, an amount equal to the difference between (i) the
Adjustment Amount as so determined and (ii) the Adjustment Amount indicated in the Preliminary
Adjustment Report. If such an agreement is not reached within such 90-day period, then the dispute
resolution procedures of Section 1.7(d) shall apply.

          (d) If the parties do not reach an agreement in writing on the Adjustment Amount within the
90-day period specified in Section 1.7(c), then Seller and Buyer shall select any of KPMG,
PricewaterhouseCoopers or Deloitte & Touche (the “Arbitrating Firm”) to resolve the disputed items.
Buyer and Seller shall each inform the Arbitrating Firm in writing as to their respective
positions with respect to the Adjustment Amount, and each shall make available to the Arbitrating
Firm any books and records and work papers relevant to the preparation of the Arbitrating Firm’s
computation of the Adjustment Amount. The Arbitrating

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Firm shall be instructed to complete its analysis within thirty (30) days from the date of its
engagement and upon completion to inform the parties in writing of its own determination of the
Adjustment Amount, the basis for its determination and whether its determination is within the
Mid-Range (defined below) or if not, whether it is closer to Buyer’s or Seller’s written
determination of the Adjustment Amount. Any determination by the Arbitrating Firm in accordance
with this Section shall be final and binding on the parties. Within five (5) calendar days after
the Arbitrating Firm delivers to the parties its written determination of the Adjustment Amount,
Seller shall pay to Buyer, or Buyer shall pay to Seller, as the case may be, an amount equal to the
difference between (i) the Adjustment Amount as determined by the Arbitrating Firm and (ii) the
Adjustment Amount indicated in the Preliminary Adjustment Report.

          (e) If the Arbitrating Firm’s determination of the Adjustment Amount is within the Mid-Range,
then Seller and Buyer shall each pay one-half of the fees and disbursements of the Arbitrating Firm
in connection with its analysis. If not, then (i) if the Arbitrating Firm determines that the
written position of Buyer concerning the Adjustment Amount is closer to its own determination, then
Seller shall pay the fees and disbursements of the Arbitrating Firm in connection with its
analysis, or (ii) if the Arbitrating Firm determines that the written position of Seller concerning
the Adjustment Amount is closer to its own determination, then Buyer shall pay the fees and
disbursements of the Arbitrating Firm in connection with its analysis. As used herein, the term
“Mid-Range” means a range that (i) equals twenty percent (20%) of the absolute difference between
the written positions of Buyer and Seller as to the Adjustment Amount and (ii) has a midpoint equal
to the average of such written positions of Buyer and Seller.

          (f) Concurrently with the payment of any amount required to be paid under Section 1.7(c) or
(d), the payor shall pay the payee interest on such amount for the period from the Closing Date
until the date paid at a rate equal to seven percent (7%) per annum. All payments to be made under
Section 1.7 shall be paid by wire transfer in immediately available funds to the account of the
payee at a financial institution in the United States and shall for all purposes constitute an
adjustment to the Purchase Price.

     1.8. Allocation. After Closing, each of Buyer and Seller will allocate the Purchase
Price in accordance with the respective fair market values of the Station Assets and the goodwill
being purchased and sold as determined by it in accordance with the requirements of Section 1060 of
the Internal Revenue Code of 1986, as amended (the “Code”). Each of Buyer and Seller shall file
its federal income tax returns and its other tax returns reflecting the allocation made by it
pursuant to this Section.

     1.9. Closing. The consummation of the sale and purchase of the Station Assets
provided for in this Agreement (the “Closing”) shall take place on the fifth business day after the
last to occur of the date of the FCC Consent pursuant to the FCC’s initial order, HSR Clearance
(defined below), if applicable, and delivery of the last of the Required Consents (defined below),
or on such earlier day as Buyer and Seller may mutually agree, in any event subject to the
satisfaction or waiver of the conditions set forth in Articles 6 and 7 below. The date on which
the Closing is to occur is referred to herein as the “Closing Date.”

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     1.10. Governmental Consents.

          (a) Within five (5) business days of the date of this Agreement, Buyer and Seller shall file
an application with the FCC (the “FCC Application”) requesting FCC consent to the assignment of the
FCC Licenses to Buyer. FCC consent to the assignment of the FCC Licenses (other than earth station
licenses, business radio licenses and weather radio licenses) to Buyer without any conditions on
such FCC Licenses or the operation or business of the Station other than those of general
applicability is referred to herein as the “FCC Consent.” Buyer and Seller shall diligently
prosecute the FCC Application and otherwise use their commercially reasonable efforts to obtain the
FCC Consent as soon as possible.

          (b) If applicable, within ten (10) business days after the date of this Agreement, Buyer and
Seller shall make any required filings with the Federal Trade Commission and the United States
Department of Justice pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the “HSR Act”) with respect to the transactions contemplated hereby (including a request
for early termination of the waiting period thereunder), and shall thereafter promptly respond to
all requests received from such agencies for additional information or documentation. Expiration
or termination of any applicable waiting period under the HSR Act is referred to herein as “HSR
Clearance.”

          (c) Buyer and Seller shall notify each other of all documents filed with or received from any
governmental agency with respect to this Agreement or the transactions contemplated hereby. Buyer
and Seller shall furnish each other with such information and assistance as the other may
reasonably request in connection with their preparation of any governmental filing hereunder. The
FCC Consent and HSR Clearance are referred to herein collectively as the “Governmental Consents.”

     1.11. Renewal. The FCC Licenses expire on February 1, 2007. Seller timely filed FCC
renewal applications with respect to the Station Licenses and thereafter prosecuted such
applications. The parties acknowledge that under current FCC policy, either the FCC will not grant
an assignment application while a renewal application is pending, or the FCC will grant an
assignment application with a renewal condition. If reasonably necessary to obtain grant of the
Station’s renewal applications and thereby facilitate the transactions contemplated by this
Agreement, if appropriate under FCC rules, regulations and policies, Seller will use commercially
reasonable efforts to enter into one or more agreements with the FCC to toll the applicable statute
of limitation with respect to indecency complaints pending against the Station.

ARTICLE 2: SELLER REPRESENTATIONS AND WARRANTIES

     Seller makes the following representations and warranties to Buyer:

     2.1. Organization. Seller is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, and is qualified to do business in each
jurisdiction in which the Station Assets are located. Seller has the requisite power and authority
to execute, deliver and perform this Agreement and all of the other agreements and instruments to
be made by Seller pursuant hereto (collectively, the “Seller Ancillary Agreements”) and to
consummate the transactions contemplated hereby.

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     2.2. Authorization. The execution, delivery and performance of this Agreement and the
Seller Ancillary Agreements by Seller have been duly authorized and approved by all necessary
action of Seller and do not require any further authorization or consent of Seller. This Agreement
is, and each Seller Ancillary Agreement when made by Seller and the other parties thereto will be,
a legal, valid and binding agreement of Seller enforceable against Seller in accordance with its
terms, except in each case as such enforceability may be limited by bankruptcy, moratorium,
insolvency, reorganization or other similar laws affecting or limiting the enforcement of
creditors’ rights generally and except as such enforceability is subject to general principles of
equity (regardless of whether such enforceability is considered in a proceeding in equity or at
law).

     2.3. No Conflicts. Except as set forth on Schedule 2.3 and except for the
Governmental Consents and consents to assign certain of the Station Contracts as indicated on
Schedules 1.1(c) and 1.1(d), the execution, delivery and performance by Seller of this Agreement
and the Seller Ancillary Agreements and the consummation by Seller of any of the transactions
contemplated hereby does not and will not conflict with, violate, result in a breach of the terms
and conditions of, or, with or without notice or the passage of time, result in any breach,
default, event of default, the creation of any lien under, or give rise to any right of
termination, amendment, modification, acceleration or cancellation of any obligation or benefit or
the loss of any benefit under, any lease, contract, license or agreement (including the Station
Contracts) to which Seller is a party or to which its assets are subject, any organizational
documents of Seller, or any law, statute, rule, regulation, judgment, order, or decree to which
Seller or any Station Asset is subject, or require the consent or approval of, registration,
qualification, designation, declaration, notice, waiver or a filing by Seller with, any
governmental or regulatory authority or any Person.

     2.4. FCC Licenses. Except as set forth on Schedule 1.1(a):

          (a) Seller is the holder of the FCC Licenses described on Schedule 1.1(a), which are all of
the licenses, permits and authorizations required for the present operation of the Station. The
FCC Licenses are in full force and effect and have not been revoked, suspended, canceled, rescinded
or terminated and have not expired. There is not pending, or, to Seller’s knowledge, threatened,
any action by or before the FCC to revoke, suspend, cancel, rescind or materially adversely modify
any of the FCC Licenses (other than proceedings to amend FCC rules of general applicability).
There is not now pending, issued, outstanding, or, to Seller’s knowledge, threatened, by or before
the FCC, any order to show cause, notice of violation, notice of apparent liability, or order of
forfeiture against the Station or against Seller with respect to the Station that could result in
any such action. The Station is operating in compliance in all material respects with the FCC
Licenses, the Communications Act of 1934, as amended (the “Communications Act”), and the rules,
regulations and policies of the FCC.

          (b) The Station has been assigned a channel by the FCC for the provision of digital television
(“DTV”) service, and the FCC Licenses include such authorization. The Station is broadcasting the
DTV signal in accordance with such authorization in all material respects.

     2.5. Taxes. With respect to Taxes (as defined below) arising out of or relating to
the operation of the Station Assets or the Station’s business, Seller has filed or will have filed
all

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material Tax returns in connection with any such federal, state or local Tax required to be
filed by it, and Seller has or will have timely paid all Taxes that have become due pursuant to
such returns except as contested in good faith. “Tax” means any federal, state, local or foreign
income, gross receipts, sales, use, ad valorem, employment, severance, transfer, gains, profits,
excise, franchise, property, capital stock, premium, minimum and alternative minimum or other
taxes, fees, levies, duties, assessments or charges of any kind or nature whatsoever imposed by any
governmental authority (whether payable directly or by withholding), together with any interest,
penalties (civil or criminal), additions to, or additional amounts imposed by, any governmental
authority with respect thereto, and any expenses incurred in connection with the determination,
settlement or litigation of any liability therefor.

     2.6. Personal Property. Schedule 1.1(b) contains a list of material items of Tangible
Personal Property included in the Station Assets. Except as set forth on Schedule 1.1(b), Seller
has good and marketable title to the Tangible Personal Property free and clear of Liens other than
Permitted Liens (defined below). Except as set forth on Schedule 1.1(b), all material items of
Tangible Personal Property are in normal operating condition, ordinary wear and tear excepted. As
used herein, “Permitted Liens” means, collectively, the Assumed Obligations, liens for Taxes not
yet due and payable, liens that will be released at or prior to Closing, and such other easements,
rights of way, building and use restrictions, exceptions, reservations and limitations that do not
in any material respect detract from the value of the property subject thereto or impair the use
thereof in the ordinary course of the business of the Station.

     2.7. Real Property.

          (a) Schedule 1.1(c) contains a description of all Real Property included in the Station
Assets. Seller has good and marketable fee simple title to the owned Real Property described on
Schedule 1.1(c) (the “Owned Real Property”) free and clear of Liens other than Permitted Liens.
Schedule 1.1(c) includes a description of each lease of Real Property or similar agreement included
in the Station Contracts (the “Real Property Leases”). To Seller’s knowledge, the Real Property is
not subject to any suit for condemnation or other taking by any public authority. The Owned Real
Property includes, and the Real Property Leases provide, access to the Real Property.

          (b) Seller has made available to Buyer copies of the Real Property Leases that are in writing.
Each Real Property Lease is in full force and effect and constitutes a valid, binding and
enforceable obligation of Seller and, to Seller’s knowledge, the other parties thereto (subject to
bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the
enforcement of creditors’ rights generally). Seller has performed its obligations under each of
the Real Property Leases in all material respects, and is not in material default (and no event has
occurred or failed to occur, which, with notice, lapse of time or both, would constitute a default
by Seller) thereunder, and to Seller’s knowledge, no other party to any of the Real Property Leases
is in default thereunder in any material respect (and to Seller’s knowledge, no event has occurred
or failed to occur, which, with notice, lapse of time or both, would constitute such a default).
There is no outstanding notice of default or termination with respect to any Real Property Lease.
All material certificates of occupancy or the equivalent, and all other material permits, licenses
and certificates required for Seller’s lawful use and operation of the Real Property have been
obtained and are current and in full force and effect in all material respects.

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     2.8. Contracts.

          (a) Schedule 1.1(d) sets forth a true and complete list of all Material Station Contracts
(defined below) existing on the date of this Agreement. Except as disclosed in the Financial
Statements (defined below) and except as disclosed on Schedule 1.1(d), Seller has made available to
Buyer the material terms of the Material Station Contracts existing as of the date of the
Agreement.

          (b) Except as set forth on Schedule 1.1(d), each of the Station Contracts (including without
limitation each of the Real Property Leases) is in full force and effect and is a valid, binding
and enforceable obligation of Seller and, to Seller’s knowledge, the other parties thereto (subject
to bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the
enforcement of creditors’ rights generally). Seller has performed its obligations under each of
the Station Contracts in all material respects, and is not in material default (and no event has
occurred or failed to occur, which, with notice, lapse of time or both, would constitute a default
by Seller) thereunder, and to Seller’s knowledge, no other party to any of the Station Contracts is
in default thereunder in any material respect (and to Seller’s knowledge, no event has occurred or
failed to occur, which, with notice, lapse of time or both, would constitute such a default).
There is no outstanding notice of default or termination with respect to any Station Contract.
Seller has made available to Buyer copies of the Material Station Contracts.

     2.9. Environmental.

          (a) Except as set forth on Schedule 1.1(a), Seller has conducted the business of the Station
and operated all Real Property and Tangible Personal Property in compliance in all material
respects with all Environmental Laws (defined below) applicable to the Station and the Station
Assets. Except as set forth on Schedule 1.1(c) or in any Seller Phase I (defined below), no
Hazardous Material (defined below) regulated under any applicable Environmental Law has been
Released (defined below) on, in, from or to the Real Property included in the Station Assets by
Seller, or, to Seller’s knowledge, by any other Person. Except as set forth on Schedule 1.1(c) or
in any Seller Phase I, Seller has not received from a governmental entity written notice of and is
not subject to any decree, judgment, order, citation, claim, action, suit, proceeding, complaint or
demand from a governmental entity based on any alleged material unresolved violation of or
liability under applicable Environmental Laws with respect to the Real Property or the operation of
the Station Assets. To Seller’s knowledge, there are no underground storage tanks on the Owned
Real Property.

          (b) For all purposes under this Agreement, “Environmental Law” shall mean any federal, state,
county, provincial, local or foreign statute, law, ordinance, regulation, rule, code judicial
precedent or rule of common law, in effect from time to time, pertaining to land use, air, soil,
surface water, groundwater, or wetlands, including the protection, cleanup, removal, remediation or
damage thereof, public or employee health or safety or any other environmental matters, or to
emissions, discharges or releases or threatened releases of any hazardous materials, including the
following laws: (i) Clean Air Act (42 U.S.C. § 7401, et seq.); (ii) Clean Water Act (33 U.S.C. §
1251, et seq.); (iii) Resource Conservation and Recovery Act (42 U.S.C. § 6901, et seq.); (iv)
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601, et seq.);
(v) Safe Drinking Water Act (42 U.S.C. § 300f, et seq.); (vi) Toxic Substances Control Act (15
U.S.C. § 2601, et seq.); (vii) Rivers and Harbors

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Act (33 U.S.C. § 401, et seq.); (viii) Endangered Species Act (16 U.S.C. § 1531, et seq.); (ix)
Occupational Safety and Health Act (29 U.S.C. § 651, et seq.); (x) Hazardous Material
Transportation Act (49 U.S.C. § 1801, et. seq.); and (xi) any other laws relating to hazardous or
toxic substances or waste materials. “Hazardous Material” means any radioactive, toxic, ignitable,
corrosive, reactive, hazardous, special or dangerous material, substance, pollutant, contaminant or
waste or any material, substance, pollutant, contaminant or waste that has been designated by any
governmental authority to be radioactive, toxic, ignitable, corrosive, reactive, hazardous or
otherwise a danger to health, reproduction or the environment, including, asbestos, petroleum,
radon gas, radioactive matter, PCBs, oils, hydrocarbons, photographic chemicals and products and
other pollutants and contaminants. “Release” means any release, spill, emission, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or subsurface strata)
or within any building, structure, facility or fixture.

     2.10. Intangible Property. Schedule 1.1(e) contains a description of the material
Intangible Property included in the Station Assets. Except as set forth on Schedule 1.1(e),
Seller’s use of the Intangible Property does not infringe upon or misappropriate any third party
rights in any material respect, including without limitation rights of privacy, rights in personal
data, moral rights or other intellectual property rights of any Person. No claim is pending, or,
to Seller’s knowledge, has been threatened with respect to any infringement or conflict resulting
from the business or operations of the Station of the use, reproduction, modification,
distribution, licensing, sublicensing, sale or any other exercise of rights in any of the
Intangible Property. Except as set forth on Schedule 1.1(b), Seller owns all right, title and
interest in, or has the right to use, the Intangible Property free and clear of all Liens other
than Permitted Liens. Except as set forth on Schedule 1.1(e), Seller has not received any written
notice that its use of the Intangible Property at the Station is unauthorized or violates or
infringes upon the rights of any other Person or challenging the ownership, use, validity or
enforceability of any Intangible Property. To Seller’s knowledge, none of the material Intangible
Property is being infringed or misappropriated by any other Person.

     2.11. Employees.

          (a) Except as set forth on Schedule 2.11, (i) Seller has complied in all material respects
with all labor and employment laws, rules and regulations applicable to the Station’s business,
including without limitation those which relate to prices, wages, hours, discrimination in
employment, collective bargaining, worker classification, overtime, occupational safety and the
WARN Act (defined below) and other applicable similar state laws and regulations, and (ii) there is
no, nor within the past twelve months has there been any, unfair labor practice charge or complaint
against Seller in respect of the Station’s business pending or to Seller’s knowledge threatened
before the National Labor Relations Board, EEOC or any federal, state or local labor relations
board or any court or tribunal, and there is no, nor within the past twelve months has there been
any, strike, dispute, request for representation, slowdown, stoppage, union campaign or other
similar organizing activity pending or threatened in respect of the Station’s business.

          (b) Seller has delivered to Buyer the list described in Section 5.7(a). Except as set forth
on Schedule 1.1(d) or Schedule 2.11, Seller is not party to any collective bargaining, union or
similar agreement with respect to employees of Seller at the Station.

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          (c) Each Employee Plan (defined below) has been established, maintained operated and
administered in all material respects in accordance with its own terms and, where applicable,
ERISA, the Code and any other legal requirement. Except as set forth on Schedule 2.11, neither the
execution of this Agreement nor the performance of this Agreement will result in any liability to
Buyer or any of its Affiliates (defined below) with respect to any Employee Plan.

          (d) To Seller’s knowledge, except as set forth on Schedule 2.11, no current liability may be
imposed upon a cessation of or reduction in contributions to, or upon any complete or partial
withdrawal from, any multiemployer plan, covering employees of Seller at the Station.

     2.12. Insurance. Seller maintains insurance policies or other arrangements with
respect to the Station and the Station Assets consistent with its practices for other stations, and
will maintain such policies or arrangements in full force and effect until Closing.

     2.13. Compliance with Law. Except as set forth on Schedule 2.13, (i) Seller has
complied in all material respects with all laws, rules and regulations, and all decrees and orders
of any court or governmental authority which are applicable to the Station Assets or the operation
of the Station, and (ii) to Seller’s knowledge, there are no governmental claims, investigations,
audits or examinations pending or threatened against Seller in respect of the Station except those
affecting the industry generally.

     2.14. Litigation. Except as set forth on Schedule 2.14, there is no action, suit or
proceeding pending or, to Seller’s knowledge, threatened against Seller in respect of the Station
or the transactions contemplated by this Agreement or that will subject Buyer to liability or which
will affect Seller’s ability to perform its obligations under this Agreement.

     2.15. Financial Statements. Seller has provided to Buyer copies of its statements of
operations and balance sheets for the Station for the years ended February 28, 2005 and February
28, 2006 (the “Year End Statements”) and its statement of operations for the fiscal year to date
ended November 30, 2006 (such statements, together with the Year End Statements, the “Financial
Statements”). The Year End Statements are the statements included in the audited consolidated
financial statements of Seller and its affiliates (but the Year End Statements are not separately
audited). The Financial Statements have been prepared in accordance with GAAP consistently
applied, are consistent with the books and records of the Station and present fairly in all
material respects the financial condition and results of operations of the Station as operated by
Seller for the respective periods covered thereby, except that (i) shared operating expenses (if
applicable) are allocated among television stations owned by Seller as determined by Seller, (ii)
employee health insurance expense reflected in the statements is an estimate of the Station’s share
of consolidated health insurance expense and not necessarily indicative of actual claims activity
of the Station, (iii) a portion of departmental operating expenses are paid in Seller’s stock but
are reflected as cash expenses in the statements, and (iv) such statements do not include income
tax expense or benefit, interest income and expense, disclosures required by GAAP in notes
accompanying the financial statements, retiree benefit expense (pension, health insurance, etc.),
non-cash compensation expenses associated with the discount given to employees on stock purchases
and associated with restricted stock grants made March 1, 2005, certain bonus and severance costs
paid to station employees related to Seller’s other station sales, certain revenues

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and expenses associated with operating the Station as a group and expenses attributable to the
adoption of accounting pronouncements.

     2.16. No Undisclosed Liabilities. There are no liabilities or obligations of Seller
that will be binding upon Buyer after the Effective Time other than the Assumed Obligations.

     2.17. Station Assets. The Station Assets include all assets that are owned, leased or
licensed by Seller and used or held for use in the operation of the Station in all material
respects as currently operated, except for the Excluded Assets.

     2.18. Affiliate Transactions. On the date hereof, except as set forth on Schedule
1.1(d), there are no Station Contracts between Seller on the one hand and any Affiliate of Seller
or any officer, director or employee of Seller or any such Affiliate on the other hand.

     2.19. Maui LLC. Seller has paid in full all capital contributions with respect to the
Station that have become due under the Maui Television Broadcasters, LLC (“MTB LLC”) operating
agreement, as set forth on Schedule 1.1(d).

ARTICLE 3: BUYER REPRESENTATIONS AND WARRANTIES

     Buyer hereby makes the following representations and warranties to Seller:

     3.1. Organization. Buyer is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, and is qualified to do business in each
jurisdiction in which the Station Assets are located. Buyer has the requisite power and authority
to execute, deliver and perform this Agreement and all of the other agreements and instruments to
be executed and delivered by Buyer pursuant hereto (collectively, the “Buyer Ancillary Agreements”)
and to consummate the transactions contemplated hereby.

     3.2. Authorization. The execution, delivery and performance of this Agreement and the
Buyer Ancillary Agreements by Buyer have been duly authorized and approved by all necessary action
of Buyer and do not require any further authorization or consent of Buyer. This Agreement is, and
each Buyer Ancillary Agreement when made by Buyer and the other parties thereto will be, a legal,
valid and binding agreement of Buyer enforceable against Buyer in accordance with its terms, except
in each case as such enforceability may be limited by bankruptcy, moratorium, insolvency,
reorganization or other similar laws affecting or limiting the enforcement of creditors’ rights
generally and except as such enforceability is subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at law).

     3.3. No Conflicts. Except for the Governmental Consents, the execution, delivery and
performance by Buyer of this Agreement and the Buyer Ancillary Agreements and the consummation by
Buyer of any of the transactions contemplated hereby does not conflict with, violate, result in a
breach of the terms and conditions of, or, with or without notice or the passage of time, result in
any breach, default, event of default, the creation of any lien under, or give rise to any right of
termination, amendment, modification, acceleration or cancellation of any obligation or benefit or
the loss of any benefit under, any lease, contract, license or agreement to which Buyer is a party
or to which its assets are subject, any organizational documents of Buyer, or any law, statute,
rule, regulation, judgment, order, or decree to which Buyer is subject, or

- 13 -

 

require the consent or approval of, registration, qualification, designation, declaration,
notice, waiver or a filing by Buyer with, any governmental or regulatory authority or any Person.

     3.4. Litigation. There is no action, suit or proceeding pending or, to Buyer’s
knowledge, threatened against Buyer which questions the legality or propriety of the transactions
contemplated by this Agreement or could materially adversely affect the ability of Buyer to perform
its obligations hereunder.

     3.5. Qualification. Buyer is legally, financially and otherwise qualified under the
Communications Act and the rules, regulations and policies of the FCC to be the licensee of,
acquire, own and operate the Station. There are no facts that would, under existing law and the
existing rules, regulations, policies and procedures of the FCC, disqualify Buyer as an assignee of
the FCC Licenses or as the owner and operator of the Station. With respect to Buyer: (a): no
waiver of or exemption from any FCC rule or policy is necessary for the FCC Consent to be obtained
and (b) there are no matters which might reasonably be expected to result in the FCC’s denial or
delay of approval of the FCC Application.

ARTICLE 4: SELLER COVENANTS 

     4.1. Seller’s Covenants. Between the date hereof and Closing, except as permitted by
this Agreement or with the prior written consent of Buyer, Seller shall:

          (a) operate the Station in the ordinary course of business consistent with past practices and
in all material respects in accordance with FCC rules and regulations and with all other applicable
laws, regulations, rules and orders;

          (b) not modify, except in the ordinary course of business or as required by applicable law,
any of the FCC Licenses, not give the FCC any grounds to institute proceedings for the termination,
revocation, modification or suspension of, or take any action or fail to take any action if such
action or failure to act would result in a modification of, any of the FCC Licenses;

          (c) not other than in the ordinary course of business, sell, lease or dispose of or agree to
sell, lease or dispose of any of the Station Assets unless replaced with similar items of
substantially equal or greater value and utility;

          (d) not create, assume or permit to exist any Liens upon the Station Assets, except for
Permitted Liens;

          (e) upon reasonable notice, give Buyer reasonable access during normal business hours to the
Station’s business and the Station Assets, and, through a representative designated by Seller, to
the Station’s employees, and furnish Buyer with information relating to the Station Assets and the
Station that Buyer may reasonably request, provided that such access rights shall not be exercised
in a manner that interferes unreasonably with the operation of the Station;

          (f) prosecute the pending license renewal applications for the FCC Licenses;

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          (f) use commercially reasonable efforts to preserve and maintain in all material respects the
goodwill of the business of the Station and the current relationships of the Station with
employees, customers, suppliers and advertisers;

          (h) maintain and replace the Tangible Personal Property and maintain the Real Property, in
each case in the ordinary course of business consistent with past practice;

          (i) maintain in full force and effect Seller’s insurance policies or other similar
arrangements with respect to the Station and the Station Assets;

          (j) pay accounts payable and collect accounts receivable in the ordinary course of business
consistent with past practice, and not compromise or discount any accounts receivable except in the
ordinary course of business consistent with past practice;

          (k) at Buyer’s sole cost and expense, provide Buyer any financial information regarding the
Station that is maintained by Seller on an unconsolidated basis and requested by Buyer;

          (l) except in the ordinary course of business consistent with past practice and as otherwise
required by law, (i) except as set forth on Schedule 2.11, not enter into any employment, labor, or
union agreement or plan (or amendments of any such existing agreements or plan) that will be
binding upon Buyer after Closing or (ii) increase the compensation payable to any employee of the
Station, except for bonuses and other compensation payable by Seller in connection with the
consummation of the transactions contemplated by this Agreement;

          (m) except as otherwise required by law, not modify any severance policy applicable to any
employee of the Station that would result in any increase in the amount of severance payable to any
such employee (or would expand the circumstances in which such severance is payable);

          (n) if requested by Buyer, deliver to Buyer copies of any unaudited monthly statements of
operations of the Station when and in the form generated by Seller in the ordinary course of
business consistent with past practice;

          (o) not amend any existing Station Contracts or enter into new Station Contracts that will be
binding upon Buyer after Closing, except for (A) new time sales agreements and other Station
Contracts made in the ordinary course of business consistent with past practice that are terminable
on ninety (90) days notice or less without payment or penalty, (B) other new contracts made with
Buyer’s prior consent (which shall not be unreasonably withheld, delayed or conditioned), and (C)
other new contracts made in the ordinary course of business consistent with past practice that do
not require post-Closing payments by Buyer of more than $250,000 (in the aggregate for all such new
contracts). Each new contract entered into pursuant to this Agreement shall be deemed a Station
Contract for purposes of this Agreement. For purposes of calculating the amount of said
post-Closing payments by Buyer, if a contract is terminable by giving advance notice and without
penalty or any fee, then such amount shall include only the post-Closing amount that would be
payable if a termination notice were given the day after Closing (whether or not such notice is in
fact given), but in no event shall such amount be more than the amount payable absent such
termination notice;

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          (p) not incur or assume any indebtedness for borrowed money that would be binding on Buyer
after Closing;

          (q) not enter into any letter of credit, performance bond, guarantee in lieu of letter of
credit or other similar obligation that would be binding on Buyer after Closing; and

          (r) not enter into any binding agreement to do any of the foregoing.

ARTICLE 5: JOINT COVENANTS

     Buyer and Seller hereby covenant and agree as follows:

     5.1. Confidentiality. Seller (or The Blackstone Group, LLC on behalf of Seller) and
Buyer (or an affiliate of Buyer on behalf of Buyer) are parties to a non-disclosure agreement with
respect to Seller and its television stations (the “NDA”). To the extent not already a direct
party thereto, Seller and Buyer hereby assume the NDA and agree to be bound by the provisions
thereof. Without limiting the terms of the NDA, subject to the requirements of applicable law, all
non-public information regarding the parties and their business and properties that is disclosed in
connection with the negotiation, preparation or performance of this Agreement (including without
limitation all financial information provided by Seller to Buyer) shall be confidential and shall
not be disclosed to any other Person, except in accordance with the terms of the NDA. After
Closing, except as required by law or compulsory legal process, all non-public information in
Buyer’s possession regarding the Station shall be confidential and shall not be disclosed to any
other Person by Seller (other than its Affiliates and Seller’s and its Affiliates’ officers,
directors, employees and advisors on a need-to-know basis) (any such information that a Person is
required to keep confidential pursuant to this sentence shall be referred to as “Confidential
Information”); provided that (i) Seller may use and disclose any such Confidential Information once
it becomes public information and (ii) Seller may disclose any such Confidential Information to the
extent Seller is legally compelled to disclose any of such information; provided, however, in such
circumstance Seller shall provide Buyer with prompt written notice of such requirement to disclose
so that Buyer may seek a protective order or other remedy or waive compliance with this Section
5.1.

     5.2. Announcements. Prior to Closing, no party shall, without the prior written
consent of the other, issue any press release or make any other public announcement concerning the
transactions contemplated by this Agreement, except to the extent that such party is so obligated
by law, in which case such party shall give advance notice to the other.

     5.3. Control. The parties acknowledge and agree that, for purposes of the
Communications Act and any other applicable law, this Agreement is not intended to, and shall not
be construed to, transfer control of the business of the Station or give Buyer any right to
directly or indirectly, control, supervise or direct the operation of the Station prior to Closing.
Consistent with the Communications Act and the FCC rules and regulations, control, supervision and
direction of the operation of the Station prior to Closing shall remain the responsibility of
Seller as the holder of the FCC Licenses.

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     5.4. Risk of Loss.

          (a) Seller shall bear the risk of any loss of or damage to any of the Station Assets at all
times until Closing, and Buyer shall bear the risk of any such loss or damage thereafter.

          (b) If prior to Closing any item of Tangible Personal Property (including any tower owned by
Seller) is damaged or destroyed or otherwise not in the condition described in Section 2.6 in any
material respect, then:

               (i) Seller shall promptly notify Buyer thereof,

               (ii) Seller shall use commercially reasonable efforts to repair or replace such item in all
material respects in the ordinary course of business consistent with past practice, and

               (iii) if such repair or replacement is not completed prior to Closing, then the parties shall
proceed to Closing, and Seller shall promptly repair or replace such item in all material respects
after Closing (and Buyer will provide Seller access and any other reasonable assistance requested
by Seller with respect to such obligation), and Buyer shall not have a claim against Seller
pursuant to Article 9 hereof to the extent such item is repaired or replaced by Seller.

          (c) Except for any DTV signal under an STA (if any), if prior to Closing the Station is off
the air or operating at a power level that results in a material reduction in coverage (an
“Interruption”), then Seller shall use commercially reasonable efforts to return the Station to the
air and restore prior coverage as promptly as possible in the ordinary course of business
consistent with past practice. Notwithstanding anything herein to the contrary, if prior to
Closing there is an Interruption in excess of twenty-four (24) hours, then Buyer may postpone
Closing until the date which is five (5) business days after the date on which the Station returns
to the air and prior coverage is restored in all material respects, subject to Section 10.1.

     5.5. Environmental.

          (a) Seller has provided Buyer with copies of Phase I environmental assessments of certain Real
Property sites as shown on Schedule 1.1(c), if any (each a “Seller Phase I”). Prior to Closing,
Buyer may, at its expense, upon notice to Seller and at times reasonably acceptable to Seller,
obtain Phase I environmental assessments (each, a “Buyer Phase I”) of any Owned Real Property and
any Real Property Leases which are ground leases (subject to any necessary landlord consent), in
each case including any Tangible Personal Property situated on such Real Property. If the written
results of any Buyer Phase I recommend or advise further investigation or testing, Buyer may, at
its expense, upon notice to Seller and at times reasonably acceptable to Seller, obtain Phase II
environmental assessments (each, a “Buyer Phase II”), subject to any necessary landlord consent.
Seller will provide Buyer or its agents (to be accompanied by a representative of Seller) access to
the Owned Real Property, any Real Property Leases which are ground leases and the Tangible Personal
Property situated on such Real Property to perform such Buyer Phase I’s and Buyer Phase II’s.

          (b) If any Seller Phase I, Buyer Phase I or Buyer Phase II, as applicable, or any item set
forth on Schedule 1.1(c) identifies a condition that requires remediation in order for the Station
to operate in compliance with Environmental Law in all material respects, then:

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               (i) except as set forth below, Seller shall use commercially reasonable efforts to remediate
such condition in all material respects in the ordinary course of business, and

               (ii) if such remediation is not completed prior to Closing, then the parties shall proceed to
Closing, and Seller shall promptly remediate such item in all material respects after Closing (and
Buyer will provide Seller access and any other reasonable assistance requested by Seller with
respect to such obligation), and Buyer shall not have a claim against Seller pursuant to Article 9
hereof to the extent such condition is so remediated by Seller.

          (c) Notwithstanding anything herein to the contrary, if at any time prior to Closing such a
condition exists and the reasonably estimated cost to remediate such condition exceeds $500,000,
then either Seller or Buyer may terminate this Agreement upon written notice to the other within
fifteen (15) calendar days after receipt of the remediation estimate.

     5.6. Consents.

          (a) The parties shall use commercially reasonable efforts to obtain (i) any third party
consents and notices necessary for the assignment of any Station Contract (which shall not require
any payment to any such third party), and (ii) execution of reasonable estoppel certificates by
lessors under any Real Property Leases requiring consent to assignment (if any), but no such
consents or estoppel certificates are conditions to Closing except for the Required Consents.
Receipt of consent to assign to Buyer the Station’s network affiliation agreement designated with a
diamond on Schedule 1.1(d) and the Station’s main tower leases designated with a diamond on
Schedule 1.1(c) (if any) is a condition precedent to Buyer’s obligation to close under this
Agreement (the “Required Consents”). Notwithstanding anything to the contrary contained herein,
neither party will be required to accept or agree to any condition, amendment, modification or
change to any Station Contract in connection with obtaining any such consent to assignment, the
effect of which is to make, or is reasonably likely to make, any such Station Contract materially
more onerous or less beneficial to Buyer than such Station Contract was to Seller or the Station
prior to Closing.

          (b) To the extent that any Station Contract may not be assigned without the consent of any
third party, and such consent is not obtained prior to Closing, this Agreement and any assignment
executed pursuant to this Agreement shall not constitute an assignment of such Station Contract;
provided, however, with respect to each such Station Contract, Seller and Buyer shall cooperate to
the extent feasible in effecting a lawful and commercially reasonable arrangement under which Buyer
shall receive the benefits under the Station Contract from and after Closing, and to the extent of
the benefits received, Buyer shall pay and perform Seller’s obligations arising under the Station
Contract from and after Closing in accordance with its terms.

     5.7. Employees.

          (a) Seller has provided Buyer a list showing employee positions and annualized pay rates for
employees of the Station. Buyer shall offer employment to all persons on such list who are
employed by Seller immediately prior to Closing (and to any employee hired after the date hereof in
the ordinary course of business to replace any employee on such list). Each such offer shall be
upon terms that will include a level of compensation and benefits

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that is substantially comparable in the aggregate to the level provided to such employees
immediately preceding the Closing (as determined before taking into account Seller’s stock
compensation program). Each employee who accepts such offer is referred to herein as a
“Transferred Employee.” Unless Buyer enters into a separate employment agreement with a
Transferred Employee or a Transferred Employee is employed pursuant to a Station Contract, each
Transferred Employee shall be an “at will” employee of Buyer, and no provision contained herein
shall be construed as an agreement for, or guarantee of, continued employment. Notwithstanding the
foregoing, at Closing Buyer shall assume the employment agreements of all Transferred Employees who
are employed pursuant to Station Contracts. Nothing in this Agreement will be deemed to prevent or
restrict in any way the right of Buyer to terminate, reassign, promote or demote any of the
Transferred Employees after Closing or to change adversely or favorably the title, powers, duties,
responsibilities, functions, locations, salaries, other compensation or terms or conditions of
employment of such employees, except as set forth in any employment agreements, all of which are
included in the Station Contracts. All Transferred Employees shall be subject to the policies
established from time to time by Buyer with respect to employment and employee benefits, and Buyer
shall not be under any obligation to assume, continue, or adopt any liabilities or obligations with
respect to Seller’s Employee Plans.

          (b) With respect to Transferred Employees, Seller shall be responsible for all compensation
and benefits arising prior to the Effective Time, and Buyer shall be responsible for all
compensation and benefits arising after the Effective Time. Notwithstanding anything herein to the
contrary, effective at the Effective Time, Buyer shall provide severance arrangements which are the
same as the severance arrangements of Seller on the date hereof (a copy of which has been provided
to Buyer) for any Transferred Employee whose employment with Buyer is terminated by Buyer other
than for cause during the twelve (12) month period immediately following the Effective Time,
provided, however, that Buyer shall have no liability for any obligation, including but not limited
to, severance or vacation and sick leave with respect to any employees who are not Transferred
Employees. Notwithstanding anything herein to the contrary, Buyer shall grant credit to each
Transferred Employee for all unused vacation accrued as of the Effective Time as an employee of
Seller, and Buyer shall assume and discharge Seller’s obligation to provide such leave to the
Transferred Employees (such obligations being a part of the Assumed Obligations).

          (c) Buyer shall permit Transferred Employees (and their spouses and dependents) to participate
in its “employee welfare benefit plans” (including without limitation health insurance plans) and
“employee pension benefit plans” (as defined in Section 3(1) and 3(2) of ERISA, respectively) in
which similarly situated employees are generally eligible to participate, with coverage effective
immediately upon the Effective Time (and without exclusion from coverage on account of any
pre-existing condition), with service with Seller deemed service with the Buyer for purposes of any
length of service requirements, waiting periods, vesting periods and differential benefits based on
length of service, and with credit under any welfare benefit plan for any deductibles or
co-payments paid for the current plan year under any plan maintained by Seller to the extent such
records of service, deductibles and co-payments have been provided by Seller.

          (d) Buyer shall also permit each Transferred Employee who participates in the Seller’s 401(k)
plan to elect to make direct rollovers of their account balances into the Buyer’s

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401(k) plan within a reasonable period of time following the Effective Time, including the
direct rollover of any outstanding loan balances such that they will continue to make payments
under the terms of such loans under the Buyer’s 401(k) plan, subject to compliance with applicable
law and subject to the reasonable requirements of Buyer’s 401(k) plan.

          (e) If applicable, Seller shall give any notice to any applicable employees required under the
Worker Adjustment and Retraining Notification Act (the “WARN Act”) or the Hawaii Dislocated Worker
Statute (the “HDWS”). Buyer shall comply with any applicable requirements under the WARN Act and
the HDWS after the Effective Time. If the WARN Act or the HDWS is applicable, then Seller may by
written notice to Buyer extend the Closing Date to a date within five (5) business days after
expiration of all applicable notice periods.

          (f) Seller shall retain all liability and responsibility for “COBRA” healthcare continuation
coverage required to be offered and provided under Section 4980B of the Code and Sections 601-608
of ERISA to employees and former employees of Seller and any other COBRA qualified beneficiaries
under Seller’s health plan(s) who have elected or are eligible to elect COBRA continuation coverage
as of or prior to the Effective Time or who incur a COBRA qualifying event in connection with the
transactions contemplated by this Agreement.

          (g) This Section 5.7 shall operate exclusively for the benefit of the parties to this
Agreement and not for the benefit of any other Person, including, without limitation, any current,
former or retired employee of Seller or spouse, domestic partner or dependents of such Persons.

     5.8. Accounting Services.

          (a) For a period of one hundred twenty (120) days after Closing (the “Collection Period”),
Buyer shall, without charge to Seller, use commercially reasonable efforts to collect the A/R in
the ordinary course of business and shall apply all amounts collected from the Station’s account
debtors to the oldest account first, unless the account debtor disputes in good faith in writing an
older account and designates the payment to a newer account. Any amounts relating to the A/R that
are paid directly to Seller shall be retained by Seller. Buyer shall not discount, adjust or
otherwise compromise any A/R and Buyer shall refer any disputed A/R to Seller. Within ten calendar
days after the end of each month, Buyer shall deliver to Seller a report showing A/R collections
for the prior month and Buyer shall make a payment, without offset, to Seller equal to the amount
of all such collections. At the end of the Collection Period, any remaining A/R shall be returned
to Seller for collection.

     (b) During the first fifteen (15) business days after Closing, Buyer shall provide to Seller
at no additional cost the services of the Station’s business offices, together with reasonable
access to related systems and records, for the purposes of closing the books of the Station for the
period prior to Closing and of facilitating the distribution of any stock compensation from Seller
to the Station’s employees, all in accordance with the procedures and practices applied by the
business offices for periods prior to Closing, such services and access not to unreasonably or
materially interfere with the operation of the business of the Station.

     5.9. 1031 Exchange. To facilitate a like-kind exchange under Section 1031 of the
Code, Seller may assign its rights under this Agreement (in whole or in part) to a “qualified

- 20 -

 

intermediary” under Section 1.1031(k)-1(g)(4) of the treasury regulations (but such
assignment shall not relieve Seller of its obligations under this Agreement) and any such qualified
intermediary may re-assign to Seller. If Seller gives notice of such assignment, Buyer shall
provide Seller with a written acknowledgment of such notice prior to Closing and pay the Purchase
Price (or such portion thereof as is designated in writing by the qualified intermediary) to or on
behalf of the qualified intermediary at Closing and otherwise reasonably cooperate therewith. In
no event shall Seller be relieved of any of its obligations hereunder in connection with, or as a
result of, any such assignment.

     5.10. Exclusivity. For a period of nine (9) months from the date of this Agreement,
so long as this Agreement remains in effect and Buyer is not in material default hereunder, Seller
shall not, and shall not permit any of its Affiliates, or any of its or their respective directors,
officers, employees, representatives or agents (collectively, the “Representatives”) to, directly
or indirectly, (i) discuss, negotiate, undertake, initiate, authorize, recommend, propose or enter
into, either as the proposed disposing, selling, surviving, merged, acquiring or acquired Person,
any transaction involving a purchase or disposition of all or substantially all of the business,
operations, properties or assets relating to the Station, other than the transactions contemplated
by this Agreement (an “Acquisition Transaction”), (ii) facilitate, solicit or initiate discussions,
negotiations or submissions of proposals or offers in respect of an Acquisition Transaction, (iii)
furnish or cause to be furnished, to any Person, any information concerning the business,
operations, properties, assets or liabilities of Seller with respect to the Station in connection
with an Acquisition Transaction, or (iv) otherwise cooperate in any way with, or assist or
participate in, or facilitate, any effort or attempt by any other Person to do or seek any of the
foregoing. For a period of nine (9) months from the date of this Agreement, so long as this
Agreement remains in effect and Buyer is not in material default hereunder, Seller shall (and shall
cause its Representatives to) immediately cease and cause to be terminated any existing discussions
or negotiations with any Person (other than Buyer) conducted heretofore with respect to any
Acquisition Transaction.

     5.11. FCC Compliance. If after Closing the FCC Consent is reversed or otherwise set
aside, and there is a final order of the FCC (or court of competent jurisdiction) requiring the
re-assignment of the FCC Licenses to Seller, then the purchase and sale of the Station Assets shall
be rescinded. In such event, Buyer shall reconvey to Seller the Station Assets, subject to any
dispositions thereof by Buyer or changes thereto in the ordinary course of business, free and clear
of Liens other than Permitted Liens, and Seller shall repay to Buyer the Purchase Price and
reassume the Station Contracts (except those Station Contracts terminated after Closing in the
ordinary course of business) and any other contracts or agreements relating to the Station that
Buyer has entered into in the ordinary course of business. Any such rescission shall be
consummated on a mutually agreeable date within thirty (30) days of such final order (or, if
earlier, within the time required by such order). In connection therewith, Buyer and Seller shall
each execute such documents (including execution by Buyer of instruments of conveyance of the
Station Assets to Seller and execution by Seller of instruments of assumption of the Station
Contracts) and make such payments (including repayment by Seller to Buyer of the Purchase Price) as
are necessary to give effect to such rescission.

     5.12. Title Commitments/Policies. Buyer may order at its own expense (i) commitments
for owner’s title insurance policies on any Owned Real Property, (ii) commitments for lessee’s
title insurance policies for any Real Property leased by Seller, and (iii) an ALTA

- 21 -

 

survey on any parcel of Real Property for which a title insurance policy is to be obtained.
Each title commitment shall evidence a commitment to issue an ALTA title insurance policy from a
nationally recognized title insurance company selected by Buyer, insuring good, marketable and
indefeasible fee simple (or leasehold, if applicable) title to each parcel of the Real Property
contemplated above for such amount as Buyer directs, and with respect to the Owned Real Property,
will contain no exceptions except for the standard general exceptions, a survey exception,
exceptions for Permitted Liens and such other exceptions, if any, as Buyer deems reasonably
acceptable. Seller shall reasonably cooperate with Buyer in obtaining such title commitments and
surveys. If prior to Closing Buyer notifies Seller that any title commitments or surveys obtained
by Buyer with respect to the Owned Real Property disclose any Liens which are not Permitted Liens,
then Seller (i) shall exercise commercially reasonable efforts to remove or remediate such Lien in
all material respects in the ordinary course of business, and (ii) if such removal or remediation
is not completed prior to Closing, then the parties shall proceed to Closing and Seller shall
promptly remove or remediate such item in all material respects after Closing (and Buyer will
provide Seller access and any other reasonable assistance requested by Seller with respect to such
obligation), and Buyer shall not have a claim against Seller pursuant to Article 9 hereof to the
extent such Lien is removed or remediated by Seller.

     5.13. Interim Actions. Upon the terms and subject to the conditions set forth in this
Agreement, Seller and Buyer shall each use their respective commercially reasonable efforts to
take, or cause to be taken, all appropriate action, and to do, or cause to be done, and to assist
and cooperate with the other parties hereto in doing, all things necessary, proper or advisable
under applicable law to consummate the transactions contemplated hereby, including, without
limitation (but subject to Sections 1.10, 5.6, 6.3 and 7.3): (i) obtaining all necessary licenses,
waivers, consents or approvals, authorizations, qualifications and other orders of any governmental
authority with competent jurisdiction over the transactions contemplated hereby, (ii) obtaining all
necessary consents, approvals or waivers from third parties, (iii) Seller or Buyer, as applicable,
promptly notifying the other party of any written notice or other material written communication,
including any written threat, filing, service or institution of any action, suit or proceeding
brought by any Person against Seller or Buyer, as applicable, that is materially adverse to the
Station, the Station Assets or the consummation of the transactions contemplated by this Agreement,
and (iv) Seller and Buyer generally using commercially reasonable efforts to take those actions
that would cause the conditions to the obligations of Seller or Buyer, as appropriate, to
consummate the transactions contemplated hereby to not be satisfied or fulfilled at or prior to
Closing.

ARTICLE 6: SELLER CLOSING CONDITIONS

     The obligation of Seller to consummate the Closing hereunder is subject to satisfaction, at or
prior to Closing, of each of the following conditions (unless waived in writing by Seller):

     6.1. Representations and Covenants.

          (a) The representations and warranties of Buyer made in this Agreement shall be true and
correct in all material respects as of the Closing Date (other than any representations or
warranties that are expressly made as of a specified date, which shall be true and correct in all
material respects as of such specified date only), except for changes permitted or contemplated by
the terms of this Agreement.

- 22 -

 

          (b) The covenants and agreements to be complied with and performed by Buyer at or prior to
Closing shall have been complied with or performed in all material respects.

          (c) Seller shall have received a certificate dated as of the Closing Date from Buyer executed
by an authorized officer of Buyer (but without personal liability) to the effect that the
conditions set forth in Sections 6.1(a) and (b) have been satisfied.

     6.2. Proceedings. Neither Seller nor Buyer shall be subject to any court or
governmental order or injunction restraining or prohibiting the consummation of the transactions
contemplated hereby.

     6.3. FCC Authorization. The FCC Consent shall have been obtained without any
condition adverse to Seller, the business or operations of the Station or the FCC Licenses.

     6.4. Hart Scott Rodino. If applicable, the HSR Clearance shall have been obtained.

     6.5. Deliveries. Buyer shall have complied with its obligations set forth in Section
8.2.

ARTICLE 7: BUYER CLOSING CONDITIONS 

     The obligation of Buyer to consummate the Closing hereunder is subject to satisfaction, at or
prior to Closing, of each of the following conditions (unless waived in writing by Buyer):

     7.1. Representations and Covenants.

          (a) The representations and warranties of Seller made in this Agreement shall be true and
correct in all material respects as of the Closing Date (other than any representations or
warranties that are expressly made as of a specified date, which shall be true and correct in all
material respects as of such specified date only), except for changes permitted or contemplated by
the terms of this Agreement.

          (b) The covenants and agreements to be complied with and performed by Seller at or prior to
Closing shall have been complied with or performed in all material respects.

          (c) Buyer shall have received a certificate dated as of the Closing Date from Seller executed
by an authorized officer of Seller (but without personal liability) to the effect that the
conditions set forth in Sections 7.1(a) and (b) have been satisfied.

     7.2. Proceedings. Neither Seller nor Buyer shall be subject to any court or
governmental order or injunction restraining or prohibiting the consummation of the transactions
contemplated hereby.

     7.3. FCC Authorization. The FCC Consent shall have been obtained without any
condition adverse to Buyer, the business or operations of the Station or the FCC Licenses.

     7.4. Hart Scott Rodino. If applicable, the HSR Clearance shall have been obtained.

- 23 -

 

     7.5. Deliveries. Seller shall have complied with its obligations set forth in Section
8.1.

     7.6. Consents. The Required Consents shall have been obtained in accordance with the
terms of Section 5.6 herein.

ARTICLE 8: CLOSING DELIVERIES

     8.1. Seller Documents. At Closing, Seller shall deliver or cause to be delivered to
Buyer, duly executed by Seller as necessary or appropriate:

          (i) good standing certificates issued by the Secretary of State of Seller’s jurisdiction of
formation;

          (ii) certified copies of resolutions duly adopted by the general partner and manager (or
equivalent thereof) of Seller, as applicable, authorizing the execution, delivery and performance
of this Agreement, including the consummation of the transactions contemplated hereby;

          (iii) the certificate described in Section 7.1(c);

          (iv) an assignment of FCC authorizations assigning the FCC Licenses from Seller to Buyer in
the form attached as Exhibit A hereto;

          (v) an executed assignment and assumption of contracts assigning the Station Contracts from
Seller to Buyer in the form attached as Exhibit A hereto;

          (vi) an assignment and assumption of leases assigning the Real Property Leases from Seller to
Buyer in the form attached as Exhibit A hereto;

          (vii) a special warranty deed conveying the Owned Real Property from Seller to Buyer in the
form attached as Exhibit A hereto;

          (viii) an assignment of marks assigning the Station’s registered marks listed on Schedule
1.1(e) from Seller to Buyer;

          (ix) domain name transfers assigning the Station’s domain names listed on Schedule 1.1(e) from
Seller to Buyer;

          (x) duly endorsed vehicle titles conveying the vehicles included in the Tangible Personal
Property from Seller to Buyer;

          (xi) an assignment of Seller’s membership interest in MTB LLC;

          (xii) a bill of sale conveying the other Station Assets from Seller to Buyer in the form
attached as Exhibit A hereto;

          (xiii) an affidavit of non-foreign status of Seller that complies with Section 1445 of the
Code; and

- 24 -

 

          (xiv) any other instruments of conveyance, assignment and transfer that may be reasonably
necessary to convey, transfer and assign the Station Assets from Seller to Buyer, free and clear of
Liens, except for Permitted Liens, in accordance with this Agreement.

     8.2. Buyer Documents. At Closing, Buyer shall deliver or cause to be delivered to
Seller, duly executed by Buyer as necessary or appropriate:

          (i) the Purchase Price in accordance with Section 1.5 hereof;

          (ii) a good standing certificate issued by the Secretary of State of Buyer’s jurisdiction of
formation;

          (iii) certified copies of resolutions duly adopted by the board of directors or managers (or
equivalent thereof) of Buyer authorizing the execution, delivery and performance of this Agreement,
including the consummation of the transactions contemplated hereby;

          (iv) the certificate described in Section 6.1(c);

          (v) an executed assignment and assumption of contracts assuming the Station Contracts in the
form attached as Exhibit A hereto;

          (vi) an assignment and assumption of leases assuming the Real Property Leases in the form
attached as Exhibit A hereto;

          (vii) domain name transfers assuming the Station’s domain names listed on Schedule 1.1(e); and

          (viii) such other documents and instruments of assumption that may be necessary to assume the
Assumed Obligations in accordance with this Agreement.

ARTICLE 9: SURVIVAL; INDEMNIFICATION

     9.1. Survival. The representations and warranties and the covenants and agreements to
be performed in whole before the Closing in this Agreement shall survive Closing for a period of
eighteen (18) months from the Closing Date whereupon they shall expire and be of no further force
or effect, except (i) those under Section 2.5 (Taxes), Sections 2.6 and 2.7 (Personal Property and
Real Property, but solely with respect to title) and Section 2.9 (Environmental), which shall
survive until the expiration of any applicable statute of limitations, and (ii) that if within such
period the indemnified party gives the indemnifying party written notice of a claim for breach
thereof describing in reasonable detail the nature and basis of such claim, then such claim shall
survive until the earlier of resolution of such claim or expiration of the applicable statute of
limitations. The covenants and agreements in this Agreement to be performed at or after the
Closing shall survive Closing until performed in full.

     9.2. Indemnification.

          (a) Subject to Section 9.2(b), from and after Closing, Seller shall defend, indemnify and hold
harmless Buyer and Buyer’s Affiliates and their respective officers, directors, managers, employees
and representatives (each, a “Buyer Indemnified Party”) from

- 25 -

 

and against any and all losses, costs, damages, liabilities and expenses, including reasonable
attorneys’ fees and expenses (“Damages”) incurred by such Buyer Indemnified Party arising out of or
resulting from:

               (i) any breach by Seller of its representations and warranties made under this Agreement; or

               (ii) any default by Seller of any covenant or agreement made under this Agreement; or

               (iii) the Retained Obligations;

               (iv) the business or operation of the Station before the Effective Time, except for the
Assumed Obligations; or

               (v) any and all liabilities or obligations arising out of or relating to the matters
disclosed on Schedule 2.14.

          (b) Notwithstanding the foregoing or anything else herein to the contrary, after Closing, (i)
Seller shall have no liability to any Buyer Indemnified Party under clause (i) of Section 9.2(a)
until, and only to the extent that, the aggregate Damages of all Buyer Indemnified Parties exceeds
$250,000 and (ii) the maximum liability of Seller under Section 9.2(a)(i) shall be an amount equal
to 20% of the Purchase Price (except for a breach of Section 2.19, to which the limits and
restrictions of this Section 9.2(b) shall not apply).

          (c) Notwithstanding anything to the contrary contained herein, Section 9.2(b) shall not apply
to any claim for indemnification by Buyer of fraud.

          (d) From and after Closing, Buyer shall defend, indemnify and hold harmless Seller and
Seller’s Affiliates and their respective officers, directors, managers, employees and
representatives (each, a “Seller Indemnified Party”) from and against any and all Damages incurred
by such Seller Indemnified Party arising out of or resulting from:

               (i) any breach by Buyer of its representations and warranties made under this Agreement; or

               (ii) any default by Buyer of any covenant or agreement made under this Agreement; or

               (iii) the Assumed Obligations; or
(iv) the business or operation of the Station after the Effective Time.

     9.3. Procedures.

          (a) The indemnified party shall give prompt written notice to the indemnifying party of any
alleged Damages subject to indemnification hereunder or any demand, suit, claim or assertion of
liability by third parties that is subject to indemnification hereunder (any of the foregoing, a
“Claim”), but a failure to give such notice or delaying such notice shall

- 26 -

 

not affect the indemnified party’s rights or the indemnifying party’s obligations except to
the extent the indemnifying party’s ability to remedy, contest, defend or settle with respect to
such Claim is thereby prejudiced and provided that such notice is given within the time period
described in Section 9.1.

          (b) The indemnifying party shall have the right to undertake the defense or opposition to such
Claim brought by any third party with counsel selected by such indemnifying party, subject to the
indemnifying party’s (i) acknowledging to the indemnified party, in writing, the indemnifying
party’s sole responsibility for the full amount of the Claim; (ii) notifying the indemnified party,
in writing promptly after receipt of the indemnified party’s notice of Claim, of its intention to
assume such defense or opposition; (iii) retaining counsel reasonably acceptable to the indemnified
party; and (iv) conducting diligently such defense or opposition at all times; In the event that
the indemnifying party does not undertake such defense or opposition in a timely manner, the
indemnified party may undertake the defense, opposition, compromise or settlement of such Claim
with counsel selected by it at the indemnifying party’s cost (subject to the right of the
indemnifying party to assume defense of or opposition to such Claim at any time prior to
settlement, compromise or final determination thereof as set forth in this 

Section 9.3(b)).

          (c) The indemnified party may undertake the defense, opposition, compromise or settlement of
such Claim with counsel selected by it at the indemnifying party’s cost at any time the
indemnifying party has not assumed or conducted such defense or opposition in accordance with
Section 9.3(b) or if the circumstances of such defense or opposition by the indemnifying party
presents the indemnifying party and the indemnified party with a conflict of interests (subject to
the right of the indemnifying party, in accordance with Section 9.3(b), to assume defense of or
opposition to such Claim at any time prior to settlement, compromise or final determination
thereof); provided that the indemnified party shall not settle any such claim or litigation without
the prior written consent of the indemnifying party, which consent shall not to be unreasonably
withheld or delayed.

          (d) Anything herein to the contrary notwithstanding:

               (i) the indemnified party shall have the right, at its own cost and expense, to participate
in the defense, opposition, compromise or settlement of the Claim;

               (ii) the indemnifying party shall not, without the indemnified party’s written consent,
settle or compromise any Claim or consent to entry of any judgment which (A) does not include the
giving by the third party claimant to the indemnified party of a release from all liability in
respect of such Claim, (B) seeks any relief other than monetary damages, or (C) seeks any relief,
all or a portion of which shall not be paid by the indemnifying party;

               (iii) in the event that the indemnifying party undertakes defense of or opposition to any
Claim, the indemnified party, by counsel or other representative of its own choosing and at its
sole cost and expense, shall have the right to consult with the indemnifying party and its counsel
concerning such Claim and the indemnifying party and the indemnified party and their respective
counsel shall cooperate in good faith with respect to such Claim; and

               (iv) in the event a Claim is solely between the parties, the indemnifying party shall,
within forty-five (45) days after the date of receipt of a notice of claim for

- 27 -

 

indemnification, respond in writing to the indemnified party and set forth with reasonable
specificity those items, if any, to which the indemnifying party does not agree and the basis for
such disagreement. Within forty-five (45) days of receipt by the indemnified party of such
response, the indemnified party, the indemnifying party and their respective representatives shall
meet to attempt to resolve through good faith negotiations the applicable disputed matters. The
parties shall negotiate in good faith for up to forty-five (45) days in an attempt to reach a
settlement of any disputed matter. In the event that such good faith negotiations are
unsuccessful, the parties may proceed in court to adjudicate the dispute.

ARTICLE 10: TERMINATION AND REMEDIES

     10.1. Termination. Subject to Section 10.3, this Agreement may be terminated prior to
Closing as follows:

          (a) by mutual written consent of Buyer and Seller;

          (b) by written notice of Buyer to Seller if Seller breaches its representations or warranties
or defaults in the performance of its covenants contained in this Agreement and such breach or
default is material in the context of the transactions contemplated hereby and is not cured within
the Cure Period (defined below);

          (c) by written notice of Seller to Buyer if Buyer breaches its representations or warranties
or defaults in the performance of its covenants contained in this Agreement and such breach or
default is material in the context of the transactions contemplated hereby and is not cured within
the Cure Period; provided, however, that the Cure Period shall not apply to Buyer’s obligation to
pay the Purchase Price at Closing;

          (d) by written notice of Seller to Buyer or Buyer to Seller if Closing does not occur by the
date twelve (12) months after the date of this Agreement (the “Outside Date”); or

          (e) as provided by Section 5.5(c).

     10.2. Cure Period. Each party shall give the other party prompt written notice upon
learning of any breach or default by the other party under this Agreement. The term “Cure Period”
as used herein means a period commencing on the date Buyer or Seller receives from the other
written notice of breach or default hereunder and continuing until the earlier of (i) twenty (20)
calendar days thereafter or (ii) five (5) business days after the scheduled Closing date; provided,
however, that if the breach or default is non-monetary and cannot reasonably be cured within such
period but can be cured before the date five (5) business days after the scheduled Closing date,
and if diligent efforts to cure promptly commence, then the Cure Period shall continue as long as
such diligent efforts to cure continue, but not beyond the date five (5) business days after the
scheduled Closing date.

     10.3. Survival. Neither party may terminate under Sections 10.1(b) or (c) if it is
then in material default or breach under this Agreement. Except as provided by Section 10.5, the
termination of this Agreement shall not relieve any party of any liability for breach or default
under this Agreement prior to the date of termination. Notwithstanding anything contained herein
to the contrary, Sections 5.1 (Confidentiality), 10.4 (Specific Performance, but solely as to

- 28 -

 

confidentiality), 10.5 (Liquidated Damages) and 11.1 (Expenses) shall survive any termination
of this Agreement.

     10.4. Specific Performance. In the event of failure or threatened failure by either
party to comply with the terms of this Agreement, the other party shall be entitled to an
injunction restraining such failure or threatened failure and, subject to obtaining any necessary
FCC consent, to enforcement of this Agreement by a decree of specific performance requiring
compliance with this Agreement.

     10.5. Liquidated Damages. If Seller terminates this Agreement pursuant to Section
10.1(c), then Buyer shall pay Seller on demand the sum of Four Million Dollars ($4,000,000) by wire
transfer of immediately available funds, and such payment shall constitute liquidated damages and
the sole and exclusive remedy of Seller under this Agreement for all defaults or breaches by Buyer
of any of its representations, warranties, covenants or agreements hereunder. Buyer acknowledges
and agrees that Seller’s recovery of such amount shall constitute payment of liquidated damages and
not a penalty and that Seller’s liquidated damages amount is reasonable in light of the substantial
but indeterminate harm anticipated to be caused by Buyer’s material breach or default under this
Agreement, the difficulty of proof of loss and damages, the inconvenience and non-feasibility of
otherwise obtaining an adequate remedy, and the value of the transactions to be consummated
hereunder.

ARTICLE 11: MISCELLANEOUS

     11.1. Expenses. Each party shall be solely responsible for all costs and expenses
incurred by it in connection with the negotiation, preparation and performance of and compliance
with the terms of this Agreement. All governmental fees and charges applicable to any requests for
Governmental Consents shall be shared equally. Buyer and Seller shall each be responsible for
one-half of all governmental taxes, fees and charges applicable to the transfer of the Station
Assets under this Agreement. Each party is responsible for any commission, brokerage fee, advisory
fee or other similar payment that arises as a result of any agreement or action of it or any party
acting on its behalf in connection with this Agreement or the transactions contemplated hereby.

     11.2. Further Assurances. After Closing, each party shall from time to time, at the
request of and without further cost or expense to the other, execute and deliver such other
instruments of conveyance and assumption and take such other actions as may reasonably be requested
in order to more effectively consummate the transactions contemplated hereby.

     11.3. Assignment. Except as provided by Section 5.9 (1031 Exchange), neither party
may assign this Agreement without the prior written consent of the other party hereto; provided,
however, that Buyer may, upon written notice to Seller but without Seller’s consent, assign its
rights to acquire the FCC Licenses hereunder (and to perform all obligations in connection
therewith) to the License Assignee (defined below) prior to the date of filing the FCC Application
provided that (i) any such assignment does not delay processing of the FCC Application, grant of
the FCC Consent or Closing, (ii) any such assignee delivers to Seller a written assumption of this
Agreement, and (iii) Buyer shall remain liable for all of its obligations hereunder. The terms of
this Agreement shall bind and inure to the benefit of the parties’ respective successors and any
permitted assigns, and no assignment shall relieve any party of any

- 29 -

 

obligation or liability under this Agreement. Notwithstanding the foregoing, at Closing,
Buyer may collaterally assign any or all of its rights under this Agreement to any of its lenders
provided that no actual assignment shall be effective unless and until the assignee assumes this
Agreement in a writing delivered to Seller and no collateral or actual assignment shall relieve
Buyer of any of its obligations hereunder.

     11.4. Notices. Any notice pursuant to this Agreement shall be in writing and shall be
deemed delivered on the date of personal delivery or confirmed facsimile transmission or confirmed
delivery by a nationally recognized overnight courier service, and shall be addressed as follows
(or to such other address as any party may request by written notice):

	 	 	 
	if to Seller:

	 	c/o Emmis Communications Corporation
	 

	 	One Emmis Plaza
	 

	 	40 Monument Circle, Suite 700
	 

	 	Indianapolis, Indiana 46204
	 

	 	Attention: President and CEO
	 

	 	Facsimile: (317) 684-5583
	 
	 	 
	with copies (which shall not

	 	Emmis Communications Corporation
	constitute notice) to:

	 	3500 W. Olive Avenue, Suite 1450
	 

	 	Burbank, California 91505
	 

	 	Attention: Gary Kaseff
	 

	 	Facsimile: (818) 238-9158
	 
	 	 
	 

	 	Wiley Rein LLP
	 

	 	1776 K Street, N.W.
	 

	 	Washington, D.C. 20006
	 

	 	Attention: Doc Bodensteiner
	 

	 	Facsimile: (202) 719-7049
	 
	 	 
	if to Buyer:

	 	c/o MCG Capital Corporation
	 

	 	1100 Wilson Blvd., Suite 3000
	 

	 	Arlington, VA 22209
	 

	 	Attention: Samuel G. Rubenstein, Esq.
	 

	 	Facsimile: (703) 247-7505
	 
	 	 
	with a copy (which shall not

	 	Dow Lohnes PLLC
	constitute notice) to:

	 	1200 New Hampshire Ave., NW, Suite 800
	 

	 	Washington, DC 20036
	 

	 	Attention: Williams S. Dudzinsky, Jr.
	 

	 	Facsimile: (202) 776-2222

     11.5. Amendments. No amendment or waiver of compliance with any provision hereof or
consent pursuant to this Agreement shall be effective unless evidenced by an instrument in writing
signed by the party against whom enforcement of such amendment, waiver, or consent is sought.

- 30 -

 

     11.6. Entire Agreement. This Agreement (including the Schedules and Exhibits hereto)
constitutes the entire agreement and understanding among the parties hereto with respect to the
subject matter hereof, and supersedes all prior agreements and understandings with respect to the
subject matter hereof, except the NDA, which shall remain in full force and effect. No party makes
any representation or warranty with respect to the transactions contemplated by this Agreement
except as expressly set forth in this Agreement. Without limiting the generality of the foregoing,
Seller makes no representation or warranty to Buyer with respect to any projections, budgets or
other estimates of the Station’s revenues, expenses or results of operations, or, except as
expressly set forth in Article 2, any other financial or other information made available to Buyer
with respect to the Station.

     11.7. Severability. If any court or governmental authority holds any provision in
this Agreement invalid, illegal or unenforceable under any applicable law, then, so long as no
party is deprived of the benefits of this Agreement in any material respect, this Agreement shall
be construed with the invalid, illegal or unenforceable provision deleted and the validity,
legality and enforceability of the remaining provisions contained herein shall not be affected or
impaired thereby.

     11.8. No Beneficiaries. Nothing in this Agreement expressed or implied is intended or
shall be construed to give any rights to any Person other than the parties hereto and their
successors and permitted assigns.

     11.9. Governing Law. The construction and performance of this Agreement shall be
governed by the laws of the State of New York without giving effect to the choice of law provisions
thereof.

     11.10. Neutral Construction. Buyer and Seller agree that this Agreement was
negotiated at arms-length and that the final terms hereof are the product of the parties’
negotiations. This Agreement shall be deemed to have been jointly and equally drafted by Buyer and
Seller, and the provisions hereof should not be construed against a party on the grounds that the
party drafted or was more responsible for drafting the provision.

     11.11. Cooperation. After Closing, Buyer shall cooperate with Seller in the
investigation, defense or prosecution of any action which is pending or threatened against Seller
or its affiliates with respect to the Station, whether or not any party has notified the other of a
claim for indemnity with respect to such matter, provided that such cooperation does not
unreasonably interfere with the business of Buyer or the Station. Without limiting the generality
of the foregoing, Buyer shall make available its employees to give depositions or testimony and
shall furnish all documentary or other evidence that Seller may reasonably request, provided that
the foregoing does not unreasonably interfere with the business of Buyer or the Station. Seller
shall reimburse Buyer for all reasonable and necessary out-of-pocket expenses incurred in
connection with the performance of its obligations under this Section 11.11.

     11.12. Guaranties.

          (a) Subject to the provisions of this Section 11.12(a), Guarantor herby absolutely,
unconditionally and irrevocably guarantees to the Buyer Indemnified Parties the payment of all
amounts payable by Seller after Closing (including, without limitation, pursuant

- 31 -

 

to Section 9.2 hereof) and the performance by Seller of all covenants, obligations,
liabilities and agreements of Seller to be performed after Closing. The foregoing obligation of
Guarantor constitutes a continuing guarantee of payment and performance, and is and shall be
absolute and unconditional under any and all circumstances which might otherwise constitute a legal
or equitable discharge of a guarantor. Buyer need not attempt to collect any obligation guaranteed
hereunder from Seller prior to enforcing its rights against Guarantor. Guarantor hereby waives (to
the fullest extent permitted by applicable law) notice of acceptance of this guaranty and notice of
any liability to which it may apply, and waives promptness, diligence, presentment, demand of
payment, protest, notice of dishonor or nonpayment, suit or taking of other action by Buyer or any
Buyer Indemnified Party against, or any other notice to, any party liable thereon (including
Seller).

          (b) Subject to the provisions of this Section 11.12(b), MCG hereby absolutely, unconditionally
and irrevocably guarantees to Seller the payment of all amounts payable by Buyer pursuant to
Section 10.5 and, prior to Closing, Section 4.1(k) and the last sentence of Section 11.1 hereof.
The foregoing obligation of MCG constitutes a continuing guarantee of payment, and is and shall be
absolute and unconditional under any and all circumstances which might otherwise constitute a legal
or equitable discharge of a guarantor. Seller need not attempt to collect any obligation
guaranteed hereunder from Buyer prior to enforcing its rights against MCG. MCG hereby waives (to
the fullest extent permitted by applicable law) notice of acceptance of this guaranty and notice of
any liability to which it may apply, and waives promptness, diligence, presentment, demand of
payment, protest, notice of dishonor or nonpayment, suit or taking of other action by Seller
against, or any other notice to, any party liable thereon (including Buyer).

     11.13. Counterparts. This Agreement may be executed in separate counterparts, each of
which will be deemed an original and all of which together will constitute one and the same
agreement.

     11.14. Consent to Jurisdiction, Waiver of Jury Trial.

          (a) THE PARTIES HERETO HEREBY IRREVOCBLY CONSENT TO THE EXCLUSIVE JURISDICTION AND VENUE OF
THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY LITIGATION RELATING TO THIS AGREEMENT AND WAIVE ANY
OBJECTION THAT THEY AT ANY TIME MAY HAVE TO THE LAYING OF VENUE IN ANY SUCH COURT AND/OR TO ANY
CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE PARTIES HERETO
HEREBY WAIVE PERSONAL SERVICE OF ANY PROCESS IN CONNECTION WITH ANY SUCH ACTION OR PROCEEDING AND
AGREE THAT THE SERVICE THEREOF MAY BE MADE BY CERTIFIED OR REGISTERED MAIL ADDRESSED TO OR BY
PERSONAL DELIVERY TO ANY OTHER PARTY AT SUCH OTHER PARTY’S ADDRESS SET FORTH PURSUANT TO SECTION
11.4 HEREOF. IN THE ALTERNATIVE, IN ITS DISCRETION, ANY OF THE PARTIES HERETO MAY EFFECT SERVICE
UPON ANY OTHER PARTY IN ANY OTHER FORM OR MANNER PERMITTED BY LAW.

- 32 -

 

          (b) The parties hereto hereby knowingly, voluntarily and intentionally waive any rights they
may have to trial by jury in respect of any litigation (whether as claim, counterclaim affirmative
defense or otherwise) in connection with or in any way related to this Agreement or any course of
conduct, course of dealing, statements (whether verbal or written), actions or inactions by or
among the parties hereto.

     11.15. Defined Terms. As used herein, the following terms shall have the following
meanings:

          (a) “Affiliate” means, as applied to any Person, (i) any other Person directly or indirectly
controlling, controlled by or under common control with, that Person, (ii) any other Person that
owns or controls 10% or more of any class of equity securities (including any equity securities
issuable upon the exercise of any option or convertible security) of that Person or any of its
Affiliates, or (iii) any director, partner, officer or manager of such Person.

          (b) “Employee Plan” means any employee benefit plan as defined in Section 3(3) of ERISA to
which Seller or any of its ERISA Affiliates (defined below) contributes or has any obligation to
contribute or to which Seller or any of its ERISA Affiliates sponsors, maintains or otherwise has
liability.

          (c) “ERISA Affiliate” means any entity required to be aggregated with Seller under Sections
414(b), (c), (m), (n) or (o) of the Code.

          (d) “License Assignee” means any Person which is, directly or indirectly, wholly-owned by
Buyer.

          (e) “Material Station Contract” means with respect to the Station, except for Retained
Obligations: (i) contracts and other agreements calling for future aggregate purchase prices,
payments or other consideration to or from Seller in any one year having a value of more than
$20,000 in any one case (or in the aggregate, in the case of any related series of contracts and
other agreements) other than for sales of advertising in the ordinary course of business consistent
with past practice; (ii) contracts and other agreements containing covenants of Seller prohibiting
or limiting the right to compete in any line of business, prohibiting or restricting its ability to
conduct business with any Person or in any geographical area, or requiring the acquisition of goods
or services exclusively from a single supplier or provider; (iii) all network affiliation
contracts; (iv) all sales agency or advertising representation contracts; (v) all contracts and
other agreements for the sale of broadcast time on the Station for other than monetary
consideration with the subject matter of the barter having a value of more than $20,000; (vi) all
contracts and other agreements pursuant to which the Station acquires programming or provides
programming to third parties; and (vii) all retransmission consent agreements.

          (f) “Person” means any individual, general, limited or limited liability partnership, firm,
corporation, limited liability company, association, trust, estate, joint venture, unincorporated
organization or other entity.

[SIGNATURE PAGE FOLLOWS]

- 33 -

 

SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth
above.

	 	 	 	 	 	 	 
	BUYER:	 	HITV OPERATING CO., INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	SELLER:	 	EMMIS TELEVISION BROADCASTING, L.P.	 	 
	 

	 	By:
	 	Emmis Operating Company, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	EMMIS TELEVISION LICENSE, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	GUARANTOR:	 	EMMIS OPERATING COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	MCG:	 	MCG CAPITAL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

 

EXHIBIT A

BILL OF SALE

     THIS BILL OF SALE is made as of                                          , 2007 by Emmis Television Broadcasting, L.P., an
Indiana limited partnership (“Seller”), to [insert Buyer name and jurisdiction of organization]
(“Buyer”).

     This Bill of Sale is made pursuant to that certain Asset Purchase Agreement (the “Agreement”)
dated                                          , 2007 among Seller, certain affiliates of Seller and Buyer with respect to the
following television stations:

KGMB(TV), Honolulu, Hawaii

KGMV(TV), Wailuku, Hawaii

KGMD-TV, Hilo, Hawaii

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and pursuant to the Agreement, Seller hereby transfers, assigns, conveys and
delivers unto Buyer all of Seller’s right, title and interest in and to the Station Assets (except
any FCC Licenses included therein, which are being assigned separately), free and clear of Liens
(other than Permitted Liens).

     To have and to hold the same unto Buyer, its successors and assigns forever.

     This Bill of Sale is made pursuant to (and does not modify) the Agreement, which contains
certain representations, warranties and covenants regarding the Station Assets. Capitalized terms
used herein and not otherwise defined shall have the respective meanings set forth in the
Agreement.

[SIGNATURE PAGE FOLLOWS]

- 35 -

 

SIGNATURE PAGE TO BILL OF SALE

     IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale as of the date first set forth
above.

	 	 	 	 	 	 	 
	 	 	EMMIS TELEVISION BROADCASTING, L.P.	 	 
	 

	 	By:
	 	Emmis Operating Company, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

- 36 -

 

ASSIGNMENT OF FCC LICENSES 

     THIS ASSIGNMENT OF FCC LICENSES (this “Assignment”) is made as of                                          , 2007 by
Emmis Television License, LLC, an Indiana limited liability company (“Assignor”), to [insert
Assignee name and jurisdiction of organization] (“Assignee”).

     This Assignment is made pursuant to that certain Asset Purchase Agreement (the “Agreement”)
dated                                          , 2007 among Assignor, certain affiliates of Assignor, and Assignee with
respect to the following television stations (the “Stations”):

KGMB(TV), Honolulu, Hawaii

KGMV(TV), Wailuku, Hawaii

KGMD-TV, Hilo, Hawaii

     The Federal Communications Commission has authorized the assignment of the FCC Licenses from
Assignor to Assignee.

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, and pursuant to the Agreement, Assignor does hereby assign to Assignee
the FCC Licenses and all rights and interests of Assignor thereunder (including without
limitation all rights in and to the Stations’ call letters), together with any renewals and
extensions thereof.

     This Assignment is made pursuant to (and does not modify) the Agreement, which contains
certain representations, warranties and covenants regarding the FCC Licenses. Capitalized terms
used herein and not defined shall have the respective meanings set forth in the Agreement.

[SIGNATURE PAGE FOLLOWS]

- 37 -

 

SIGNATURE PAGE TO ASSIGNMENT OF FCC LICENSES

     IN WITNESS WHEREOF, Assignor has duly executed this Assignment as of the date first set forth
above.

	 	 	 	 	 
	 	EMMIS TELEVISION LICENSE, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

- 38 -

 

ASSIGNMENT AND ASSUMPTION OF CONTRACTS

     THIS ASSIGNMENT AND ASSUMPTION OF CONTRACTS (this “Assignment and Assumption”) is made as of
                                         , 2007 between Emmis Television Broadcasting, L.P., an Indiana limited partnership
(“Assignor”), and [insert Assignee name and jurisdiction of organization] (“Assignee”).

     This Assignment and Assumption is made pursuant to that certain Asset Purchase Agreement (the
“Agreement”) dated                                          , 2007 among Assignor, certain affiliates of Assignor, and Assignee
with respect to the following television stations:

KGMB(TV), Honolulu, Hawaii

KGMV(TV), Wailuku, Hawaii

KGMD-TV, Hilo, Hawaii

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and pursuant to the Agreement, Assignor hereby assigns to Assignee the Station
Contracts and all of Assignor’s rights, interests and benefits thereunder, free and clear of Liens
(other than Permitted Liens), and Assignee hereby assumes and agrees to perform the obligations of
Assignor arising after Closing thereunder.

     Notwithstanding anything to the contrary set forth herein, to the extent that any Station
Contract may not be assigned without the consent of any third party, and such consent is not
obtained prior to Closing, this Assignment and Assumption shall not constitute an assignment of
such Station Contract; provided, however, with respect to each such Station Contract, Assignor and
Assignee shall cooperate to the extent feasible in effecting a lawful and commercially reasonable
arrangement under which Assignee shall receive the benefits under the Station Contract from and
after Closing, and to the extent of the benefits received, Assignee shall pay and perform
Assignor’s obligations arising under the Station Contract from and after Closing in accordance with
its terms.

     This Assignment and Assumption may be signed in any number of counterparts with the same force
and effect as if all signatures appeared on one and the same instrument. This Assignment and
Assumption is made pursuant to (and does not modify) the Agreement, which contains certain
representations, warranties and covenants regarding the Station Contracts. Capitalized terms used
herein and not defined shall have the respective meanings set forth in the Agreement.

[SIGNATURE PAGE FOLLOWS]

- 39 -

 

SIGNATURE PAGE TO ASSIGNMENT AND ASSUMPTION OF CONTRACTS

     IN WITNESS WHEREOF, Assignor and Assignee have duly executed this Assignment and Assumption as
of the date first set forth above.

	 	 	 	 	 	 	 
	ASSIGNOR:	 	EMMIS TELEVISION BROADCASTING, L.P.	 	 
	 

	 	By:
	 	Emmis Operating Company, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	ASSIGNEE:	 	[ASSIGNEE]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

- 40 -

 

ASSIGNMENT AND ASSUMPTION OF REAL PROPERTY LEASES

     THIS ASSIGNMENT AND ASSUMPTION OF REAL PROPERTY LEASES (this “Assignment and Assumption”) is
made as of                                          , 2007 between Emmis Television Broadcasting, L.P., an Indiana limited
partnership (“Assignor”), and [insert Assignee name and jurisdiction of organization] (“Assignee”).

     This Assignment and Assumption is made pursuant to that certain Asset Purchase Agreement (the
“Agreement”) dated                                          , 2007 among Assignor, certain affiliates of Assignor, and Assignee,
with respect to the following television stations:

KGMB(TV), Honolulu, Hawaii

KGMV(TV), Wailuku, Hawaii

KGMD-TV, Hilo, Hawaii

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and pursuant to the Agreement, Assignor hereby assigns to Assignee the Real
Property Leases (defined below) and all of Assignor’s rights, interests and benefits thereunder,
free and clear of Liens (other than Permitted Liens), and Assignee hereby assumes and agrees to be
bound by and perform the obligations of Assignor arising after Closing thereunder.

     As used herein, “Real Property Leases” means:

     [TBD]

     This Assignment and Assumption may be signed in any number of counterparts with the same force
and effect as if all signatures appeared on one and the same instrument. This Assignment and
Assumption is made pursuant to (and does not modify) the Agreement, which contains certain
representations, warranties and covenants regarding the Real Property Leases. Capitalized terms
used herein and not defined shall have the respective meanings ascribed to such terms in the
Agreement.

[SIGNATURE PAGE FOLLOWS]

- 41 -

 

SIGNATURE PAGE TO

ASSIGNMENT AND ASSUMPTION OF REAL PROPERTY LEASES

     IN WITNESS WHEREOF, Assignor and Assignee have duly executed this Assignment and Assumption as
of the date first set forth above.

	 	 	 	 	 	 	 
	ASSIGNOR:	 	EMMIS TELEVISION BROADCASTING, L.P.	 	 
	 	 	By: Emmis Operating Company, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

State of                                         

County of                                         

     On
this ___ day of                                          2007, before me personally appeared        
                   
              , the
               
               
           of Emmis Operating Company, an Indiana corporation and the              
          
                  of Emmis
Television Broadcasting, L.P., an Indiana limited partnership (the “Assignor”), who acknowledged
the execution of the foregoing instrument to be the free act and deed of the Assignor.

[Affix Notarial Seal]

	 	 	 	 	 	 	 
	 	 	Notary Public                                         	 	 
	 	 	My commission expires                                         	 	 
	 
	 	 	 	 	 	 
	ASSIGNEE:	 	[ASSIGNEE]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

State of                                         

County of                                         

     On
this ___ day of        
            
           
           2007, before
me personally appeared          
                    
           ,
the                                          of [insert Assignee name and jurisdiction of organization] (the “Assignee”),
who acknowledged the execution of the foregoing instrument to be the free act and deed of the
Assignee.

[Affix Notarial Seal]

	 	 	 	 	 	 	 
	 	 	Notary Public                                         

My commission expires                                         	 	 

- 42 -

 

	 	 	 
	LAND COURT

	 	REGULAR SYSTEM
	 
	Return By Mail  o  Pick-Up   o  To:
	 	 
	 
	 	 
	 
	TITLE OF DOCUMENT:
	 	 
	 
	 	 
	LIMITED WARRANTY DEEP

	 
	 	 
	 
	PARTIES TO DOCUMENT:
	 	 

	 	 	 	 	 
	GRANTOR:	 	EMMIS TELEVISION BROADCASTING, L.P., an Indiana limited partnership
	 
	 	 	 	 
	GRANTEE:
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	TAX MAP KEY(S):

	 	Oahu 2-3-21-6
	 	(This document consists of
___ pages.)
	 

	 	KGMB-TV Studios	 	 

 

 

LIMITED WARRANTY DEED

     KNOW ALL MEN BY THESE PRESENTS:

          That on                     , 2007, EMMIS TELEVISION BROADCASTING, L.P., an Indiana limited
partnership, hereinafter called the “Grantor”, for and in consideration of the sum of TEN AND
NO/100 DOLLARS ($10.00) and other good and valuable consideration to the Grantor paid by
                                                            , a
                                                            , whose address is
                                                            ,
hereinafter called the “Grantee”, the receipt whereof is hereby acknowledged, does hereby grant,
bargain, sell and convey unto the Grantee all of that certain real property more particularly
described in Exhibit A attached hereto and made a part hereof, subject to the encumbrances
noted therein.

          TOGETHER WITH all and singular the buildings, improvements, rights, tenements, hereditaments,
easements, privileges and appurtenances thereunto belonging or appertaining or held and enjoyed in
connection therewith.

          TO HAVE AND TO HOLD the same unto the Grantee in fee simple forever.

          AND the Grantor and the Grantor’s successors in interest, do hereby covenant with the Grantee
that the granted premises are free and clear of all encumbrances made or suffered by the Grantor,
except as noted in said Exhibit A and except for assessments for real property taxes not
yet by law required to be paid; and that the Grantor will WARRANT AND DEFEND the same unto the
Grantee against the lawful claims and demands of all persons claiming by, through or under the
Grantor, except as aforesaid.

          IT IS MUTUALLY AGREED that the terms “Grantor” and “Grantee”, as and when used hereinabove or
hereinbelow shall mean and include the masculine or feminine, the singular or plural number,
individuals, associations, trustees, corporations, partnerships or limited liability companies, and
their and each of their respective successors in trust, successors in interest, heirs, executors,
personal representatives, administrators and permitted assigns, according to the context thereof,
and that if these presents shall be signed by two or more grantors, or by two or more grantees, all
covenants of such parties shall be and for all purposes deemed to be joint and several.

44

 

          IN WITNESS WHEREOF, the Grantor has executed these presents as of the day and year first above
written.

	 	 	 	 	 
	 	EMMIS TELEVISION BROADCASTING, 

      L.P., an Indiana limited partnership

By Emmis Operating Company

     Its General Partner

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Grantor

45

 

	 	 	 	 	 	 	 	 	 
	STATE OF
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	)	 
	 

	 	 

	 	 	 	 	)	ss. 
	COUNTY OF
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	)	 

          On                     , 2007, before me,                                        
 , a Notary Public for the State of
                                        , personally appeared                     , personally known to me [or proved to me
on the basis of satisfactory evidence] to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.

          WITNESS my hand and official seal.

	 	 	 
	 

Signature of Notary

	 	 NOTARY
STAMP

*****************************OPTIONAL SECTION ***********************

CAPACITY SIGNED BY SIGNER:

Though statute does not require the Notary to fill in the data below, doing so may prove invaluable
to persons relying on the document.

	 	 	 
	[ ] INDIVIDUAL(S)

	 	CORPORATE OFFICER(S)
	 
	 	 
	 

	 	title(s)

	[ ] PARTNER(S)

	 	[ ] ATTORNEY-IN-FACT
	[ ] TRUSTEE(S)

	 	[ ] SUBSCRIBING WITNESS
	[ ] GUARDIAN/CONSERVATOR

	 	[ ] OTHER:

SIGNER IS REPRESENTING (NAME OF PERSON(S) OR ENTITY(IES)):

************************** OPTIONAL SECTION *************************

	 	 	 	 	 
	THIS CERTIFICATE MUST BE ATTACHED

	 	 	 	TITLE OR TYPE OF DOCUMENT:
	TO THE DOCUMENT DESCRIBED AT 

RIGHT:
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	NUMBER OF PAGES:
	 

	 	 	 	 
	 
	 	 	 	 
	Though the data
requested here is not
required by law, it
could prevent
fraudulent
reattachment of this form.

	 	 	 	DATE OF DOCUMENT:
	

	 	 	 	SIGNER(S) OTHER THAN NAMED ABOVE:

46

 

EXHIBIT A

          All of that certain parcel of land situate at Pawaa-Kai, Honolulu, City and County of
Honolulu, State of Hawaii, described as follows:

          LOT 55, containing an area of 40,168 square feet, more or less, as shown on Map 1, filed in
the Office of the Assistant Registrar of the Land Court of the State of Hawaii with Land Court
Consolidation No. 83 of Kapiolani Blvd. Lands, Inc.

          BEING the same premises described in and covered by Land Court Certificate of Title No. 564,
955, issued to Emmis Television Broadcasting, L.P., an Indiana limited partnership, and conveyed by
Limited Warranty Deed dated September 28, 2000, recorded in said Office as Document No. 2655875.

          SUBJECT, HOWEVER, to the following:

[TBD]

          Tax Map Key: Oahu 2-3-21-6exv10w18

 

EXHIBIT 10.18

LEASE

THIS LEASE made the 14th day of November, 2005,

IN PURSUANCE OF THE SHORT FORMS OF LEASES ACT

BETWEEN:

592423 ONTARIO INC.,

(the “Landlord”)

OF THE FIRST PART

AND

LOYALTY MANAGEMENT GROUP CANADA INC.,

(the “Tenant”)

OF THE SECOND PART

In consideration of the premises and the mutual covenants, agreements and conditions herein
contained, it is hereby covenanted, agreed and declared between the parties as follows:

ARTICLE 1.00 - DEFINITIONS

The terms defined herein shall, for all purposes of this Lease and all instruments
supplemental hereto, have the following meanings, unless the context expressly or by
necessary implication otherwise requires:

	 	(a)	 	“Additional Rent” shall mean all sums of money, other than Basic Rent,
which are required to be paid by the Tenant pursuant to any provision of this
Lease.
	 
	 	(b)	 	“Additional Service” shall mean any service which is requested by the
Tenant in addition to those supplied by the Landlord as part of the normal
Development service and which the Landlord is prepared to supply at an
additional cost to the Tenant.
	 
	 	(c)	 	“Additional Service Cost” shall mean the additional cost payable by
the Tenant to the Landlord for any Additional Service.
	 
	 	(d)	 	“Basic Rent” shall mean the rent payable by the Tenant pursuant to
Section 4.1.
	 
	 	(e)	 	“Building” shall mean the building and all other fixed improvements
situate at any time on the Lands, all of which are commonly known as 438
University Avenue, Toronto, Ontario.
	 
	 	(f)	 	“Building Standard” shall mean the building standard established by
the Landlord, including matters of design, construction and/or installation to be
observed by the tenants in the Building, as amended from time to time by the
Landlord, acting reasonably.
	 
	 	(g)	 	“Business Hours” shall mean the period from 7:00 A.M. to 6:00 P.M.
on any Business Day and “Business Day” shall mean Monday through Friday excluding
all statutory or civic holidays. “Business Operating Hours” has the meaning
ascribed to it in Section 6.2 herein.
	 
	 	(h)	 	“Capital Tax” shall mean any tax or taxes payable under the Corporations Tax Act (Ontario) or
under any existing or proposed

 

 

 2 

federal legislation based upon or computed by reference to the paid-up capital or place of
business Of the Landlord and/or the owners of the Development as determined for the purposes
of such tax or based upon or computed by reference to the taxable capital employed in Canada
or any similar tax levied, imposed or assessed in the future in lieu thereof or in addition
thereto by any municipal, legislative or parliamentary authority.

	 	(i)	 	“Common Facilities” shall mean those areas and facilities of the Development which serve
the Development, including, without limitation, the landscaped areas, sidewalks, public
entrance doors, halls, public lobbies, lavatories, stairways, passageways, elevators, service
ramps and common loading and receiving facilities and Common Use Equipment and which are
designated from time to time by the Landlord for the common use and enjoyment of the tenants
in the Development, including the Tenant, and their agents, invitees, servants, employees and
licensees or for use by the public, but excluding rentable premises in the Building and other
portions of the Building which are from time to time designated by the Landlord for private
use by one or a limited group of tenants.
	 
	 	G)	 	“Common Use Equipment” shall mean all mechanical, plumbing, electrical and HVAC
equipment, pipes, ducts, wiring, machinery and equipment and other integral services, utility
connections and the like providing services to the Building, but for greater certainty shall
exclude any items installed by the Tenant pursuant to Sections 16.27, 16.28 and 16.29 of this
Lease.
	 
	 	(k)	 	“Development” shall mean the Lands and the Building.
	 
	 	(I)	 	“Insured Damage” shall mean that part of any damage occurring to the Development,
including the Premises, of which the cost of repair (except as to any reasonable deductible
amount provided for in the applicable policy or policies of insurance) is recovered by the
Landlord or its assignee under a policy or policies of insurance from time to time effected by
the Landlord pursuant hereto or would have been recoverable had the Landlord taken out the
insurance required of it pursuant to this Lease.
	 
	 	(m)	 	“Lands” shall mean the lands described in Schedule “B” attached hereto, as the boundaries
thereof may be varied from time to time by additions functionally integrated therewith or by
deletions for road widening or other public purposes.
	 
	 	(n)	 	INTENTIONALLY DELETED
	 
	 	(o)	 	“Lease” shall mean this lease agreement, including any Schedules, as amended from time to
time pursuant hereto.
	 
	 	(p)	 	“Leasehold Improvements” shall mean all items generally considered as leasehold
improvements, including, without limitation, all fixtures, equipment, improvements,
installations, alterations and additions from time to time made, erected or installed by or on
behalf of the Tenant or any previous occupant of the Premises, in the Premises, including all
partitions however affixed and whether or not movable, and all wall-to-wall carpeting, other
than carpeting laid over finished floors and affixed so as to be readily removable without
damage; but excluding trade fixtures, furniture, unattached or free-standing partitions and
equipment which is readily removable without causing material damage.

 

 

 3 

	 	(q)	 	“Operating Costs” shall mean operating costs as defined in Schedule “C” attached hereto;
	 
	 	(r)	 	INTENTIONALLY DELETED
	 
	 	(s)	 	“Premises” shall mean the premises demised to the Tenant under this Lease consisting of all
of the 2nd, 3rd, 4th, 5th, 6th,
7th, 8th, 9th, 10th, and 11th floors of
the Building, (each containing 17,656.6 square feet of Rentable Area), for a total of 176,566
square feet of Rentable Area as per the certificate attached as Schedule “J” to this Lease,
which Premises are shown on Schedule “E” attached hereto and the Rentable Area of which have
been determined in accordance with the Standard Method of Floor Measurement set forth in
Schedule “A”.
	 
	 	(t)	 	“Present Value” shall mean the value determined by using an annual discount rate equal to
the annual rate of interest in effect as of such date of default announced by the Canadian
Imperial Bank of Commerce as its prime rate, being the reference rate used by it to determine
interest for loans in Canadian dollars to Canadian customers.
	 
	 	(u)	 	“Proportionate Share” shall mean a fraction having as its numerator the Rentable Area of
the Premises and as its denominator the Total Rentable Area of the Building.
	 
	 	(v)	 	“Rate of Interest” shall mean the annual rate of interest announced from time to time by
the Canadian Imperial Bank of Commerce as the reference rate of interest then in effect for
loans to customers of varying degrees of credit-worthiness plus 3%, adjusted from time to time
to reflect changes in such rate.
	 
	 	(w)	 	“Rent” shall mean Basic Rent and Additional Rent.
	 
	 	(x)	 	“Rentable Area” and “Net Rentable Area” shall mean the number of square feet of floor
area determined in accordance with the method of floor measurement set forth in Schedule
“A”.
	 
	 	(y)	 	“Sales Taxes” shall mean all goods and services taxes or similar taxes imposed by the
government of Canada or any provincial or local government upon the Landlord or the Tenant or
in respect of this Lease or the payments made by the Tenant hereunder or the goods and
services provided by the Landlord hereunder, including, without limitation, the rental of the
Premises and the provision of administrative services to the Tenant hereunder.
	 
	 	(z)	 	“Taxes” shall mean all taxes, rates, duties, levies, fees, charges, sewer levies, local
improvement rates and assessments whatsoever imposed, assessed, levied or charged now or in
the future by any school, municipal, regional, provincial, federal, parliamentary or other
governmental body, corporate authority, agency or commission (including, without limitation,
school boards and utility commissions) against the Development and/or the Landlord and/or the
owner of the Development in connection therewith. There shall be excluded from Taxes:

	 	(i)	 	land improvement levies, development charges and local improvement
rates to the extent incurred in respect of the initial development of the
Development or any additions thereto (including, without limitation, the
construction of any additions to the Building and any additional building(s)
erected on the Lands);

 

 

 4 

	 	(ii)	 	the Landlord’s corporate, business, inheritance,
estate, succession, income, profits and excess profits taxes and any
other’,fa1<; rate, duty, fee, assessment, impost, charge or levy of a
personal nature to the Landlord, including, without limitation, Capital
Tax (including, without limitation, the federal Large Corporation Tax);
and
	 
	 	(iii)	 	any penalties or carrying charges relating to
the late payment by the Landlord of Taxes or any installment(s)
thereof.

	 	(aa)	 	“Tenant’s Taxes” shall mean the aggregate of:

	 	(i)	 	all taxes imposed upon the Tenant which are
attributable to the personal property, furnishings, fixtures and Leasehold
improvements installed in the Premises; and
	 
	 	(ii)	 	all taxes imposed upon the Tenant which are
attributable to the business, income or occupancy of the Tenant or any other
occupant of the Premises and to the use of any of the Common Facilities by
the Tenant or other occupant of the Premises.

	 	(bb)	 	“Term” shall mean the term of this Lease as specified in Section 3.3
as same may be extended pursuant to Section 16.26 of this Lease.
	 
	 	(cc)	 	“Total Rentable Area of the Building” shall mean the aggregate of all
Rentable Areas (including the Premises) of the Building, measured in accordance
with the method of floor measurement specified in Schedule “A” of this Lease,
excluding all storage areas located below grade.

ARTICLE 2.00 — GENERAL COVENANTS

	2.1	 	Tenant’s Covenants
	 
	 	 	The Tenant covenants with the Landlord:

	 	(a)	 	to pay Rent; and
	 
	 	(b)	 	to observe and perform all the covenants and obligations of the Tenant
herein.

	2.2	 	Landlord’s Covenants
	 
	 	 	The Landlord covenants with the Tenant:

	 	(a)	 	for quiet enjoyment; and
	 
	 	(b)	 	to observe and perform all the covenants and obligations of the Landlord
herein.

ARTICLE 3.00 — DEMISE AND TERM

	3.1	 	Demise of Premises
	 
	 	 	The Landlord hereby demises and leases unto the Tenant, and the Tenant hereby leases from
the Landlord, the Premises for the Term and subject to the provisions of this Lease.

 

 

 5 

	3.2	 	License Over Certain Common Facilities
	 
	 	 	The Landlord hereby grants to the Tenants its agents, employees, invitees and other persons
transacting business with it, in common with all others entitled thereto, a license to have
the use of such of the Common Facilities as is reasonably necessary for the use, enjoyment
and access to the Premises, including, without limitation, the entrances to the Building,
the elevators, stairways, corridors, foyers, lobbies and lavatories; provided, however,
that such use shall be subject to all other provisions contained in this Lease and to the
Landlord’s Rules and Regulations referred to in Section 7.6.
	 
	3.3	 	Term
	 
	 	 	To have and to hold the Premises for and during the term of ten (10) years and 14 days (the
“Term”), commencing September 17th, 2007, or such date as may be extended
pursuant to Section 16.19 hereof (the “Commencement Date”) and ending September
30th, 2017.
	 
	 	 	The Tenant shall have the right to occupy and commence operation in the Premises prior to
the Commencement Date, provided that both the Tenant’s Work and Landlord’s Work have been
completed. Should the Tenant occupy the Premises prior to the Commencement Date, the Tenant
shall be governed by the terms and conditions of this Lease, save for the payment of any
Basic Rent, and the Tax component of Additional Rent. For clarity purposes, the Tenant
shall be responsible for the payment of Operating Costs and the Tenant hydro for the
portion of the Premises that it occupies and operates its business in prior to the
Commencement Date. Should the Tenant request the Landlord to complete the Landlord’s Work
prior to December 31, 2006 (on space that is located on the 4th to 7th floors only), the
Tenant shall be responsible for the payment of Additional Rent for any period that it
occupies and operates its business in prior to December 31, 2006. Prior to occupancy, the
Tenant shall provide evidence of insurance coverage satisfactory to the Landlord, acting
reasonably.
	 
	3.4	 	Overholding
	 
	 	 	If the Tenant occupies any part of the Premises after the expiration or sooner termination
of the Term without objection by the Landlord, the Tenant shall be deemed to be only a
monthly tenant at a monthly basic rent payable in advance and equal to one and one-quarter
(VA) of the monthly Basic Rent payable immediately prior to the overholding, plus
additional rent equivalent to Additional Rent hereunder, and otherwise on the same terms as
herein contained, except for any right of renewal; and such tenancy may be terminated by
either the Landlord or the Tenant on 30 days’ notice to the other. Nothing herein shall
limit the liability of the Tenant in damages or otherwise.
	 
	3.5	 	Leasehold Improvements

	 	(a)	 	Subject to Sections 3.5(b) and (c) and Sections 16.27, 16.28, 16.29 and
16.30, upon the expiration or other termination of this Lease, all Leasehold
Improvements in the Premises, including all fixed partitions (including floor to
ceiling partitions which, although demountable, involve attachment to any floor,
ceiling or permanent wall such that they cannot be removed without damage to the
Premises, but excluding the Tenant’s movable partitions, such as free-standing
partitions or partial height partitions which can be removed without damage to the
Premises and which shall be deemed to be removable trade fixtures) shall remain upon
and be surrendered with the Premises as a part thereof without disturbance,
molestation or injury and the same and any trade fixtures not removed or not in the
process of being removed by the Tenant are the property of the

 

 

 6 

Landlord absolutely, free of any liens or encumbrances and without payment
therefore to the Tenant.

	 	(b)	 	The Landlord may, by notice to the Tenant prior to or promptly after the
expiration or other termination of this Lease, require the removal forthwith, at the
expense of the Tenant, of any or all of the Tenant’s trade fixtures and the repair
forthwith of any damage to the Premises or the Development caused by such removal,
such work to be done forthwith by or at the direction of the Landlord and at the
expense of the Tenant. If such notice is given prior to the expiration or other
termination of this Lease, such removal and repair shall be completed by such
expiration or termination.
	 
	 	(c)	 	Notwithstanding anything herein contained, provided the Tenant has paid
the Rent hereby reserved and performed and observed all the covenants and conditions
herein contained, the Tenant shall have, at the expiration or other termination of
this Lease, the right to remove its trade fixtures, furnishings and equipment
provided that the Tenant repairs by the expiration or other termination of this
Lease, at its own expense, any damage to the Premises or the Development caused by
such removal, such work to be done by or at the direction of the Landlord and at the
expense of the Tenant.

ARTICLE 4.00 — RENT

	4.1	 	Basic Rent
	 
	 	 	The Tenant shall pay to the Landlord yearly and every year during the Term without any
set-off, compensation or deduction whatsoever, except as is otherwise specifically
provided for in this Lease, Basic Rent in Canadian dollars as follows:

	 	(a)	 	For the first year (plus 14 days) to the end of the fifth year, the sum
of $16.00 per square foot of Rentable Area annually plus G.S.T., payable in advance
in equal consecutive monthly installments on the first day of each and every month
during such period; and
	 
	 	(b)	 	for years six to ten inclusive, the sum of $16.50 per square foot of
Rentable Area annually plus G.S.T., payable in advance in equal consecutive monthly
installments on the first day of each and every month during such period.

	4.2	 	Additional Rent
	 
	 	 	The Tenant shall pay to the Landlord during the Term, when due, as Additional Rent:

	 	(a)	 	all Tenant’s Taxes;
	 
	 	(b)	 	that portion of Taxes payable by the Tenant pursuant to Section 5.3;
	 
	 	(c)	 	the Tenant’s Proportionate Share of Operating Costs pursuant to Section
6.1;
	 
	 	(d)	 	all Additional Service Costs payable by the Tenant; and
	 
	 	(e)	 	all other amounts payable by the Tenant pursuant to this Lease.

 

 

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	4.3	 	Payment of Additional Rent
	 
	 	 	The Additional Rent specified in Sections 4.2(b) and (c) shall be paid and adjusted with
reference to a fiscal period of 12 calendar months, which shall be the 12-month period
ending on December 31st in each year during the Term, unless the Landlord, by notice to the
Tenant, shall from time to time have selected a fiscal period which ends on a different
date (but which shall be a 12-month period, except where a shorter broken fiscal period
occurs at the commencement or end of the Term or is necessary to accommodate a change in
the fiscal period made during the Term). From time to time throughout the Term, the
Landlord shall give notice to the Tenant of the Landlord’s estimate of such Additional Rent
to be paid by the Tenant during the next ensuing fiscal period. Each estimate shall be
reasonable. Such Additional Rent payable by the Tenant shall be paid in equal monthly
installments in advance at the same time as payment of Basic Rent is due hereunder and
shall be based on the Landlord’s estimate as aforesaid. From time to time the Landlord may
re-estimate on a reasonable basis the amount of such Additional Rent for any fiscal period,
in which case the Landlord shall give notice to the Tenant of such re-estimate and fix new
equal monthly installments for the remaining balance of such fiscal period so that after
giving credit for the installments paid by the Tenant on the basis of the previous estimate
or estimates, all the Additional Rent as estimated or re-estimated will have been paid
during such fiscal period.
	 
	 	 	All Additional Service Costs shall be paid by the Tenant within 5 days after receipt by it
from time to time of invoices from the Landlord specifying the amounts thereof.
	 
	4.4	 	Adjustment of Additional Rent
	 
	 	 	The Landlord agrees to provide the Tenant with an audited accounting of the actual
Additional Rent payable to the Landlord pursuant to Sections 4.2(b) and 4.2(c) in respect
of the relevant fiscal period referred to in Section 4.3 within one hundred and twenty
(120) days of the end of each such fiscal period. Within thirty (30) days after the receipt
of such accounting for the relevant fiscal period, either the Tenant shall pay to the
Landlord any amount by which the amount found payable by the Tenant with respect to such
fiscal period exceeds the aggregate of the monthly payments made by it on account thereof
or the Landlord shall pay to the Tenant any amount by which the amount found payable as
aforesaid is less than the aggregate of such monthly payments. The Tenant shall have the
right exercisable by the delivery of written notice to the Landlord within eighteen (18)
months following receipt by it of the relevant audited accounting of such Additional Rent
for the relevant fiscal period, upon reasonable prior notice to have access to Landlord’s
books and records respecting such Additional Rent for the relevant fiscal period for the
purposes of verifying same, provided that such verification is completed by a chartered
accounting firm that is not compensated on a contingency basis. Such verification shall be
done at the sole cost and expense of the Tenant unless the results of such verification
indicate that the said Additional Rent for the relevant fiscal period have been overstated
by 4% or more, in which event Landlord shall reimburse the Tenant for its costs of such
verification within fifteen (15) days of receipt of an invoice therefore, failing which,
the Tenant shall be entitled to deduct same from the Rent. The Tenant shall reimburse
Landlord for its reasonable bona fide out-of-pocket costs incurred in respect of any such
verification by the Tenant, unless the results of such verification indicate that the said
Additional Rent for the relevant fiscal period have been overstated by 4% or more, in which
event the Landlord shall be responsible for all such out-of-pocket costs. For greater
certainty should the Tenant fail to provide the Landlord with written notice of the
exercise of its rights hereunder within eighteen (18) months of receipt by it of the
relevant audited accounting of such Additional Rent for the relevant fiscal period, the
Tenant’s right to

 

 

 8 

conduct such verification for such relevant fiscal period shall become null and void.

In the event of any dispute by the Tenant as to the amount of such Additional Rent
payable, a letter of the Landlord’s auditors shall be conclusive absent manifest error.

	 	4.5	 	Apportionment of Rent
	 
	 	 	 	Rent shall be considered as accruing from day to day hereunder. If it is necessary to
calculate Rent for a period of less than one year or less than one calendar month, an
appropriate apportionment and adjustment on a pro rata daily basis shall be made. Where
the calculation of Additional Rent cannot be made until after the expiration or earlier
termination of this Lease, the obligation of the Tenant to pay such Additional Rent and
the obligation of the Landlord to refund any overpayments shall survive the expiration or
earlier termination hereof and such amount shall be paid by the Tenant to the Landlord
forthwith upon demand or by the Landlord to the Tenant forthwith upon determination of
any such overpayment, as the case may be If the Term commences on any day other than the
first day of the month, Rent for such fraction of a month shall be adjusted as aforesaid
and paid by the Tenant on the Commencement Date.
	 
	 	4.6	 	No Right of Set-off
	 
	 	 	 	The Tenant expressly waives the benefits of Section 35 of the Commercial Tenancies Act,
and any amendments thereto and any present or future enactment of the Province of Ontario
permitting the Tenant to claim a set-off against Rent for any cause whatsoever.
	 
	 	4.7	 	Additional Rent Deemed Rent
	 
	 	 	 	All Additional Rent shall be deemed to be Rent and the Landlord shall have all rights
against the Tenant for default in payment of Additional Rent as for default in the
payment of Basic Rent.
	 
	 	4.8	 	Interest on Arrears
	 
	 	 	 	If the Tenant fails to pay Rent when due, the Tenant shall pay interest on the unpaid
amount at the Rate of Interest from the date due until the date paid without prejudice to
and in addition to any other remedy available to the Landlord under this Lease or at law.
	 
	 	4.9	 	Net Lease to Landlord
	 
	 	 	 	This Lease and the Rent payable hereunder shall be absolutely net to the Landlord, except
as expressly provided herein.
	 
	 	4.10	 	Deposit
	 
	 	 	 	The Landlord acknowledges that the Tenant has delivered a cheque in the amount equal to
the first months Basic Rent, Additional Rent and GST due under this Lease to be held by
Avison Young Commercial Real Estate (Ontario) Inc., in trust, in an interest bearing
trust account with all interest accruing to benefit of Tenant as a deposit until
application on account of the first months Basic Rent, Additional Rent and GST due under
this Lease.

 

 

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ARTICLE 5.00 — TAXES

	5.1	 	Taxes
	 
	 	 	The Landlord shall pay when due to the taxing authority or authorities having
jurisdiction all Taxes.

	5.2	 	Tenant’s Taxes and Sales Taxes

	 	(a)	 	The Tenant shall pay without duplication of any other amount payable by
it pursuant to this Lease when due to the taxing authority or authorities having
jurisdiction all Tenant’s Taxes.
	 
	 	(b)	 	The Tenant shall pay to the Landlord when due all Sales Taxes imposed
on the Landlord with respect to Rent payable by the Tenant hereunder or in respect
of the rental of space under this Lease.

	5.3	 	Tenant’s Contribution to Taxes

	 	(a)	 	The Tenant shall, in respect of each calendar year included in whole or
in part within the Term, pay to the Landlord, without duplication, an amount to
cover the Taxes that are attributable to the Premises for such calendar year, such
amount to be determined on the basis of a separate assessment or separate valuation
for the Premises (or, in lieu thereof, calculations made by authorities having
jurisdiction from which a separate assessment or separate valuation for the Premises
may be readily determined) and in the absence of such separate assessment or
separate valuation (or, in lieu thereof, such calculations made by authorities
having jurisdiction from which a separate assessment or separate valuation for the
Premises may be readily determined), the Tenant shall pay its Proportionate Share of
Taxes. The Tenant shall provide the Landlord with a copy of any separate notices of
assessment for the Premises which the Tenant has received.
	 
	 	(b)	 	INTENTIONALLY DELETED
	 
	 	(c)	 	The Tenant shall, in respect of each calendar year included in whole or
in part within the Term, pay to the Landlord the amount by which Taxes are increased
above the Taxes which would have otherwise been payable as a result of the Premises
or the Tenant or any other occupant of the Premises being taxed or assessed in
support of separate schools.
	 
	 	(d)	 	Payment by the Tenant of all amounts on account of Taxes shall be
governed by Sections 4.3 and 4.4.

	5.4	 	Payments

	 	(a)	 	The Landlord may postpone any payment payable by it pursuant to Section
5.1 and the Tenant may postpone any payment payable by it directly to a taxing
authority (but not to the Landlord) pursuant to this Article, in each case to the
extent permitted by law and if prosecuting in good faith any appeal against the
imposition thereof, but provided that in the case of a postponement by the Tenant
which involves any risk of the Development or any part thereof or the Landlord
becoming liable to assessment, prosecution, fine or other liability, the Tenant
shall have given security in a form and of an amount satisfactory to the Landlord in
respect of such liability and such undertakings as the Landlord may reasonably
require to ensure payment thereof.
	 
	 	(b)	 	Whenever requested by the Landlord, the Tenant shall deliver to the
Landlord receipts for payment of all Tenant’s Taxes and furnish such other

 

 

10

information in connection therewith as the Landlord may reasonably require.

ARTICLE 6.00 — SERVICES. COMMON FACILITIES

	6.1	 	Tenant’s Contribution to Operating Costs

	 	(a)	 	The Tenant shall throughout the Term pay to the Landlord the Tenant’s
Proportionate Share of Operating Costs.
	 
	 	(b)	 	Payment by the Tenant of all amounts on account of the Tenant’s
Proportionate Share of Operating Costs shall be governed by Sections 4.3 and 4.4.

	6.2	 	Operation of Regular HVAC System
	 
	 	 	The Landlord and the Tenant acknowledge that the Building operating hours shall be Monday
through Friday from 8:00 a.m. to11:59 p.m., Saturday from 8:00 a.m. to 6:00 p.m., and
Sunday from 11:00 am to 1:00 p.m., (the “Building Operating Hours”). Heating, ventilation
and air conditioning (“HVAC”) shall be provided during the Building Operating Hours so as
to maintain during the Building Operating Hours a comfortable temperature for the
Tenant’s intended uses of the Premises and in any event in accordance with the standards
of a first class office building in the downtown core of the City of Toronto, except
during the making of repairs, inspections, overhauling or replacement. In addition, the
Landlord will upon request of the Tenant make available HVAC services outside of Building
Operating Hours to the Tenant so as to maintain during such after hours HVAC a
comfortable temperature for the Tenant’s intended uses of the Premises and in any event
in accordance with the standards of a first-class office building in the downtown core of
the City of Toronto, which cost to the Tenant shall be equal to the Landlord’s costs to
provide such after-hours HVAC, with no profit. The Tenant shall provide the Landlord with
not less than twenty-four (24) hours’ prior written notice of the times it requires HVAC
services outside of Building Operating Hours as aforesaid, unless same are required on a
weekend or a statutory holiday, in which event the Tenant shall notify the Landlord of
the times it requires same not later than noon on the Business Day immediately preceding
such weekend or statutory holiday.
	 
	 	 	If any equipment or systems are damaged or destroyed or, in the opinion of the Landlord,
require repair, inspection, overhauling or replacement, the Landlord shall (i) give the
Tenant reasonable prior written notice of such repair, inspection, overhauling or
replacement except in the event of an emergency; and (ii) carry out such repair,
inspection, overhauling or replacement with all reasonable diligence and in such manner so
as to minimize any interference with the Tenant’s business operations in the Premises. The
Landlord shall not be responsible for any loss, damages or costs arising from the failure
of such equipment or systems to perform their function, so long as the Landlord diligently
proceeds to the extent reasonably possible in the circumstances, directed by the cause of
any such failure of such equipment and systems to perform their function. In addition, the
Landlord shall not be responsible for the failure of such equipment and systems to perform
their function if the number of persons in the Premises at any one time exceeds a
reasonable number (the Landlord acknowledging and agreeing that a portion of the Premises
may be used and is intended to be used as a customer care centre/call centre) or if the
electrical load from lights and power in the Premises is excessive or if such failure
results from any arrangement of partitioning in the Premises or change or alteration
thereto or if the window covering on exterior windows is not kept fully closed while the
windows are exposed to direct sunlight or if any use of mechanical or electrical equipment
installed in the Premises generates heat in excess of amounts

 

 

11

specified in the Building Standard. The Landlord shall not be liable for direct,
indirect or consequential damage or damages for personal discomfort or illness of the
Tenant of its employees, invitees or other persons transacting business with it by
reason of the operation or non-operation of such systems and equipment.

In no event shall Rent abate during any non-operation.

	6.3	 	Additional HVAC — INTENTIONALLY DELETED
	 
	6.4	 	Other Utilities

	 	(a)	 	The Landlord shall furnish to the Premises electricity for lighting and
for office and kitchen equipment capable of operating from the circuits available
and standard to the Building. The Tenant shall pay without duplication, as an
Additional Service Cost all charges for electricity and other utilities provided to
the Premises. The charges for electricity and other utilities used in the Premises
shall be determined by the Landlord or its agent using a reasonable method of
calculation which has been communicated to the Tenant. If requested by the Landlord
or Tenant, the Landlord shall install, at the Landlord’s sole expense, separate
meters for measuring consumption of energy in the Premises.
	 
	 	(b)	 	The Landlord shall also replace as and when required all electric light
bulbs, fluorescent tubes and ballasts initially supplied in the Premises and provide
the necessary maintenance and repair of fluorescent and other standard Building
lighting fixtures located in the Premises. The costs of replacement, maintenance and
repair shall, as determined by the Landlord from time to time and applied on a
uniform basis in the Development, either be charged to the Tenant as an Additional
Service Cost or included in Operating Costs.

	6.5	 	Operation of Common Facilities
	 
	 	 	All Common Facilities shall be subject at all times to the exclusive control and
management of the Landlord. The Landlord shall be entitled to operate and police the
same, to change the area and location thereof, to employ all personnel and to make all
rules and regulations necessary for the proper operation and maintenance thereof and to
do such other acts with respect thereto as the Landlord, acting reasonably, shall
determine to be advisable; provided, however, that the Tenant, unless deprived by reasons
beyond the Landlord’s control, shall always have the use of such of the Common Facilities
as is reasonably necessary for the use, enjoyment and access to the Premises. In the
exercise by the Landlord of its rights under this Section 6.5, the Landlord shall:

	 	(i)	 	unless deprived by reasons beyond the Landlord’s control,
ensure that access to the Premises is at all times available from the elevator
lobbies of the Building by at least two (2) elevators;
	 
	 	(ii)	 	use reasonable commercial efforts so as not to materially affect
the visibility of the Tenant’s exterior signage referred to in Sections 7.7(a)
and 7.7(b) of this Lease; and
	 
	 	(iii)	 	use reasonable commercial efforts so as not to materially
affect the Tenant’s business operations in the Premises and repair any damage
to the Premises, the Leasehold Improvements and the furniture and equipment
located in the Premises caused as a result of the exercise of such rights.

 

 

12

	6.6	 	Janitorial Services

	 	(a)	 	The Landlord shall provide to the Premises normal office cleaning services of a
standard (both as to extent and frequency) as a reasonably prudent owner of a similar
first-class office building in the downtown core of the City of Toronto would do, the
cost of which is to form a part of Operating Costs. Such services shall include, but
not be limited to, causing periodically as may be appropriate or necessary in keeping
with such standard the floors of the Premises to be swept, the interior surface of the
exterior windows of the Premises to be cleaned, the desks, tables, other furniture and
Venetian blinds, if any, in the Premises to be dusted and any broadloom in the Premises
to be vacuumed. Cleaning in addition to the foregoing standard (such as, for example,
the washing of carpets and the dry-cleaning of drapes) shall be the responsibility of
the Tenant, although the Landlord shall have the right to elect to provide such
additional cleaning as provided in Section 6.6(c).
	 
	 	(b)	 	The Tenant acknowledges that the Landlord will be relieved from its cleaning
obligation as provided in Section 6.6(a) in respect of any part of the Premises to
which access is not granted to the person or persons retained to perform such work.
	 
	 	(c)	 	If the Landlord from time to time elects, acting reasonably, to provide
exclusively (either directly or through agents or contractors designated by it) any
janitor or cleaning services for the Premises in addition to those contemplated by
Section 6.6(a) or to supervise the moving of furniture or equipment of the Tenant or
the making of deliveries to or from the Premises, such additional services referred to
in this Section 6.6(c) shall be treated as Additional Services and all reasonable
Additional Service Costs shall be paid by the Tenant to the Landlord forthwith after
demand.
	 
	 	(d)	 	The Tenant acknowledges that the Landlord shall not be responsible for any
omission or act of commission on the part of the person or persons employed or retained
to perform the cleaning services referred to in this Section or for any loss thereby
sustained by the Tenant, the Tenant’s employees, agents, invitees or others. Provided
however, the Landlord shall use reasonable commercial efforts to ensure the person or
persons employed or retained to perform the cleaning services referred to in this
Section 6.6(d) are insured in a manner comparable to the insuring of cleaning personnel
in other similar first-class office buildings in the downtown core of the City of
Toronto.
	 
	 	(e)	 	In the event the Tenant is not satisfied with the level or quality of cleaning
services being provided to the Premises by the Landlord, the Landlord shall upon
receipt from the Tenant of particulars as to the reason(s) for its dissatisfaction, use
reasonable commercial efforts to cause same to be rectified by the person or persons
employed or retained to perform such cleaning services to the satisfaction of the
Tenant. The Landlord shall keep the Tenant advised at all times as to the steps being
undertaken by it from time to time to rectify the cause of such Tenant’s
dissatisfaction.

	6.7	 	Security Services

	 	(a)	 	Subject to Section 16.32 herein, the Landlord shall provide security services
for the Building so as to reasonably ensure that access to the Building during other
than Business Hours shall be restricted to those persons entitled to be allowed entry
to the Building, provided they comply with the requirements established by the
Landlord.
	 
	 	(b)	 	The Tenant acknowledges that the Landlord shall not be responsible for any
omission or act of commission on the part of any person employed or

 

 

13

retained to provide security service pursuant to this Section or for any loss thereby
sustained by the Tenant, the Tenant’s employees, agents, invitees or others. Provided however,
the Landlord shall use reasonable commercial efforts io ensure that the person or persons
providing such security services are insured in a manner comparable to the insuring of
security personnel in other similar first-class office buildings in the downtown core of the
City of Toronto.

	6.8	 	Interruption in Services
	 
	 	 	The Landlord has the right upon reasonable prior notice to the Tenant (except in the event
of an emergency) to stop the use of any facilities and the supply of any services when
necessary by reason of accident or during the making of repairs, replacements, alterations
or improvements in the judgment of the Landlord are necessary to be made until the repairs,
replacements, alterations or improvements have been completed to the satisfaction of the
Landlord, provided that the Landlord shall carry out such repairs, replacements,
alterations and improvements with due diligence and in such a manner so as to minimize any
interference with the Tenant’s business operations in the Premises, both as to the extent
and duration of such interference. The Landlord shall have no responsibility or liability
for failure to operate any facilities or supply any services when the use of the facility
is stopped as aforesaid or when the Landlord is prevented from using the facility or
supplying the service by strike or by orders or regulations of any governmental authority
or agency or by failure of the electric current, gas, steam or water supply necessary to
the operation of any facility or by the failure to obtain such a supply or by any other
cause beyond the Landlord’s reasonable control. Provided however, in any such instance the
Landlord shall to the extent possible in the circumstances proceed diligently to restore
the operation of any such facility or the supply of any such service, as the case may be.
	 
	6.9	 	Energy Conservation
	 
	 	 	The Tenant shall use reasonable commercial efforts to comply with any measures the
Landlord, acting reasonably, or any legislative authority may from time to time introduce
to conserve or to reduce consumption of energy or to reduce or control other Operating
Costs or pay as Additional Rent the cost, to be estimated by the Landlord, acting
reasonably, of the additional energy consumed by reason of such non-compliance.
	 
	 	 	It is understood and agreed that:

	 	(a)	 	any and all costs and expenses paid or incurred by the Landlord in installing
energy conservation equipment and systems, so far as the same apply to or are
reasonably apportioned to the Building by the Landlord, shall to the extent permitted
be included in Operating Costs; and
	 
	 	(b)	 	the Landlord shall not be liable to the Tenant in any way for any loss,
costs, damages or expenses whether direct or consequential, paid, suffered or incurred
by the Tenant due to any reduction in the services provided by the Landlord to the
Tenant or to the Building or any part thereof as a result of the Landlord’s compliance
with such laws, by-laws, regulations or orders.

	6.10	 	Pest Control by the Tenant
	 
	 	 	The Tenant agrees to institute and carry out and maintain at its own expense such pest
control measures in the Premises as the Landlord reasonably requires.

 

 

14

ARTICLE 7.00 — USE AND OCCUPANCY OF PREMISES

	7.1	 	Use of Premises
	 
	 	 	The Tenant may use the Premises solely for the sole purpose of general business offices,
a customer care centre / call centre, licensed travel agent, and cafeteria preparing and
serving food for its employees and invitees only (and not general sale to the public)
(such uses being hereinafter individually and collectively referred to as the “Intended
Uses”); and any other use permitted by the applicable by-laws covering the Premises. The
Tenant shall use commercially reasonable efforts to ensure that odors do not emanate from
the Premises. Notwithstanding the above, only the general business offices shall be
entitled to use the Premises above the tenth (10th) floor of the Building and it is
further acknowledged that no form of call centre shall be permitted above the 10th floor
of the Building, and the Tenant shall not use or permit the Premises to be used for any
other purpose.
	 
	7.2	 	Waste and Nuisance
	 
	 	 	The Tenant shall not carry on any business or do or suffer any act or thing which may
constitute or result in a nuisance to the Landlord or to other tenants of the Development
or do or suffer any waste or damage to the Premises or the Development. The Landlord
acknowledges and agrees that the Intended Uses (including, without limitation, as a
customer care centre/call centre so long as same is not permitted above the
10th floor of the Building) are deemed not to constitute a nuisance to the
Landlord or to the other tenants of the Development, provided that such Intended Uses are
being conducted in accordance with the terms of this Lease.
	 
	7.3	 	No Overloading of Floors or Common Use Equipment
	 
	 	 	The Tenant shall not permit or allow any overloading of the floors of the Premises or the
bringing into any part of the Premises of any articles or fixtures that by reason of
their weight or size might damage or endanger the structure of the Premises or the
Building. The Tenant shall not permit or allow anything that might result in any
overloading of any of the Common Use Equipment.
	 
	7.4	 	Insurance Cancellation or Increase
	 
	 	 	The Tenant shall not do or omit to do or permit to be done or omitted to be done in the
Premises anything which would cause an increase in the cost of any insurance which the
Landlord is obligated by this Lease to maintain. In the event of any such increase, the
Tenant shall pay to the Landlord, forthwith upon demand, the amount of any such increase
in cost. If any insurance policy maintained by the Landlord on the Development is
cancelled or not renewed or threatened by the insurer to be cancelled or not renewed or
the coverage thereunder is altered in any way because of the use or occupation of the
Premises by the Tenant or by any person for whom the Tenant is in law responsible, and if
the Tenant fails to remedy the condition giving rise to the cancellation or non-renewal,
threatened cancellation or non-renewal or alteration in coverage within 48 hours (or such
longer period as may be afforded to the Landlord by its insurers) or fails to obtain
insurance coverage in replacement of the coverage cancelled or not renewed, threatened to
be cancelled or not renewed or altered in coverage, the Landlord may, but shall not be
obligated to, without further notice or any liability to the Tenant or any other occupant
of the Premises, enter the Premises and attempt to remedy such condition or obtain or
attempt to obtain insurance coverage in replacement of the coverage cancelled, not
renewed threatened to be cancelled or not renewed or altered in coverage; and the Tenant
shall pay to the Landlord forthwith upon demand the cost thereof. The Landlord

 

 

15

acknowledges and agrees that the Intended Uses (including, without limitation, as a
customer care centre/call centre, so long as same is not permitted above the
10th floor of the Building) are deemed not to constitute any such increase in
the cost of any insurance which the Landlord is obligated by this Lease to maintain or
to cause any such cancellation, non-renewal, threatened cancellation or non-renewal or
alteration in coverage, provided that such Intended Uses are being conducted in
accordance with the terms of this Lease.

	7.5	 	Observance of Law by the Landlord and the Tenant

	 	(a)	 	The Landlord shall, at its expense (except insofar as the expense is
included in Operating Costs), promptly comply with and conform to the requirements
of every applicable statute, law, by-law, regulation, ordinance and order at any
time or from time to time in force during the Term affecting the Development, other
than to those matters which are the obligation of the Tenant as provided in Section
7.5(b).
	 
	 	(b)	 	The Tenant shall, at its expense, promptly comply with and conform to the
requirements of every applicable statute, law, by-law, regulation, ordinance and
order at any time or from time to time in force during the Term affecting the
Tenant’s use of the Premises or any part thereof and/or the business carried on
therein and/or the Leasehold Improvements, trade fixtures, furniture, machinery,
equipment and other facilities located in the Premises and/or any other part of the
Development affected by the Tenant’s actions in the Premises. Notwithstanding the
foregoing, the Landlord shall be responsible at its sole cost and expense and to the
complete exoneration of the Tenant for remedying any work done by it in the Premises
which was not done in compliance with the requirements of any applicable statute,
law, bylaw, regulation, ordinance or order. The Landlord hereby covenants, warrants
and represents to the Tenant that as of the Access Date, the Development and the
Premises shall be in compliance with the requirements of all such applicable
statutes, laws, by-laws, regulations, ordinances and orders. Without prejudice to
any other rights available to the Tenant under this Lease or at law, the Landlord
shall be responsible at its sole cost and expense for any work required as a result
of the foregoing, covenant, representation and warranty being untrue.

	7.6	 	Rules and Regulations
	 
	 	 	The Tenant shall observe and perform and shall cause its employees, agents, invitees and
others over whom the Tenant can reasonably be expected to exercise control to observe and
perform the rules and regulations attached hereto as Schedule “D” (the “Rules and
Regulations”) and such other rules and regulations or amendments as may be made from time
to time by the Landlord, acting reasonably.
	 
	 	 	The Tenant acknowledges that the Rules and Regulations as from time to time amended or
replaced are not necessarily of uniform application, but may be waived in whole or in
part in respect of other tenants without affecting their enforceability with respect to
the Tenant and the Premises and may be waived in whole or in part with respect to the
Premises without waiving them as to future application to the Premises and the imposition
of such Rules and Regulations shall not create or imply any obligation of the Landlord to
enforce them.
	 
	 	 	In any conflict between a provision of this Lease and any of the Rules and
Regulations, the provision of this Lease shall govern. Such Rules and

 

 

16

Regulations as amended shall not be promulgated or enforced in an arbitrary or
discriminatory manner as against the Tenant.

	7.7	 	Signs

	 	(a)	 	For the Term, the Tenant shall have the exclusive signage rights to the
facia at the top of the Building, to install signage displaying a logo and, or a
name on the Building. The Tenant shall pay for the cost to install, maintain, and
insure such signage, and for the cost to remove such signage at the expiry or
termination of this Lease. There shall be no ongoing charge for such signage
rights. The Landlord will work with the Tenant to assist the Tenant to obtain any
and all required permits for such signage. The exact size and location(s) of the
Tenant’s signage shall be in accordance with the Tenant’s specifications, subject to
all governing authorities, and to the Landlord’s written approval, such approval not
to be unreasonably withheld or delayed.
	 
	 	(b)	 	For the Term, the Tenant shall be permitted to install non-exclusive
(save that no other office-only tenant shall have any signage rights at these
locations) signage displaying a logo and, or a name, on the grade, and, or second
floor facia, on the eastern and northern elevations of the Building. The Tenant
shall pay for the cost to install, maintain, and insure such signage, and for the
cost to remove such signage at the expiry or termination of this Lease. There
shall be no ongoing charge for such signage rights. The Landlord will work with the
Tenant to assist the Tenant to obtain any and all required permits for such signage.
The exact size and location of the Tenant’s grade level signage shall be in
accordance with the Tenant’s specifications, subject to all governing authorities,
and to the Landlord’s written approval, such approval not to be unreasonably
withheld or delayed.
	 
	 	(c)	 	For the Term, the Tenant shall have exclusive rights for the three (3)
signage boxes (display areas) located in the Building’s northern elevator lobby. The
Tenant shall be permitted to display corporate, and, or sponsor information,
signage, logos and, or names in these display areas. There shall be no ongoing
charge for such signage rights, or use of these display areas.
	 
	 	(d)	 	The Landlord shall not nor shall it permit any tenant or occupant of the
Building (other than the Tenant) to name the Building other than its municipal
address.

	7.8	 	Name of Development
	 
	 	 	The Tenant shall, in referring to the Development, use only the name designated
from time to time by the Landlord.

ARTICLE 8.00 — ALTERATIONS

	8.1	 	Alterations by the Tenant

	 	(a)	 	The Tenant shall not, without the prior consent of the Landlord, make,
erect, alter or install any Leasehold Improvements or other alterations to the
Premises (the “Work”). Notwithstanding the foregoing, the Tenant shall be entitled,
without the consent of the Landlord but upon prior notice to the Landlord, to
complete Work which does not in the aggregate cost more than Twenty Five Thousand
Dollars ($25,000) to complete (which amount shall increase by three percent (3%)
compounded annually on each anniversary date of the Commencement Date) provided that
same does not affect the structural components of

 

 

17

the Building and/or the base building mechanical, electrical and/or plumbing
systems and does not require a building permit to complete.

	 	(b)	 	If the Tenant wishes to do any Work requiring the Landlord’s prior
written consent, the Tenant shall apply for the Landlord’s consent and furnish such
plans, specifications and designs as shall be necessary to fully describe the Work.
The Landlord’s consent thereto shall not be unreasonably withheld or delayed;
provided that, without limitation, any refusal to grant consent based on grounds
that such Work is not in compliance with the Building Standard or that the Tenant
has not posted security with the Landlord (which in the case of the Tenant’s Work
the Tenant shall not be required to post), shall be conclusively deemed not to be an
unreasonable withholding of consent.
	 
	 	(c)	 	Subject to the Landlord’s consent having been obtained and the Landlord’s
reasonable requirements being met, the Landlord recognizes the right of the Tenant
to install such interior partitions and other Leasehold Improvements as are
necessary or appropriate to its use and occupancy of the Premises.
	 
	 	(d)	 	Any Work which affects the structural components of the Building and/or
the base building mechanical, electrical and/or plumbing systems (the “Excluded
Work”) shall, if the Landlord so elects, be performed by employees or contractors
who have been designated by the Landlord and who have contracted directly with the
Tenant and agreed to carry out such Work in a good and workmanlike manner and at a
cost to the Tenant which is not unreasonable when compared with the amounts which
would be charged by reputable contractors performing the same Work. In the absence
of any such election by the Landlord with respect to the Excluded Work, the Excluded
Work and all other such Work shall be performed by contractors retained by the
Tenant. In either event, the Landlord shall have the right to inspect such Work
(including the Excluded Work) and require any Work (including the Excluded Work) not
being properly done to be corrected and with respect to any Work (including the
Excluded Work) which requires the Landlord’s prior written consent to approve on a
reasonable basis the contractors, tradesmen or the Tenant’s own employees (as the
case may be) employed by the Tenant in connection therewith.
	 
	 	(e)	 	Subject to Section 16.34 in respect of the Tenant’s Work, the Tenant
shall pay to the Landlord within 10 days after the receipt of the Landlord’s invoice
the Landlord’s reasonable out-of-pocket costs incurred in examining and approving
the Tenant’s plans, specifications and designs and in inspecting the Work (including
the Excluded Work), unless the Tenant uses the Landlord’s base building or
designated engineers) or consultant(s) with respect to such Work (including the
Excluded Work) in which event the Tenant shall not be responsible for any costs
incurred by the Landlord in respect thereof and any additional out-of-pocket
expenses actually incurred by the Landlord in connection with such Work (including
the Excluded Work).
	 
	 	(f)	 	The Tenant shall upon request provide to the Landlord a complete set of
updated drawings of the Premises, including, without limitation, all electrical,
mechanical and architectural drawings.

	8.2	 	Air-Balancing
	 
	 	 	The Landlord agrees that it will on the Commencement Date and periodically throughout the
Term, including, without limitation, whenever any alterations

 

 

18

are made to the Premises, balance the air movement in the Premises at the Tenant’s
expense.

	8.3	 	No Financing by the Tenant of Leasehold Improvements
	 
	 	 	Deleted Intentionally
	 
	8.4	 	Liens

	 	(a)	 	In connection with the making, erection, installation or alteration of
Leasehold Improvements and trade fixtures and all other work or installations made by
or for the Tenant in the Premises, the Tenant shall comply with every applicable
statute, law, by-law, regulation, ordinance and order affecting the same and affecting
the Development as a result of the actions of the Tenant, including, without
limitation, the Construction Lien Act of Ontario and any other statutes from time to
time applicable thereto (including any provision requiring or enabling the retention
by way of holdback of portions of any sums payable) and, except as to any such
holdback, shall promptly pay all accounts relating thereto.
	 
	 	(b)	 	Whenever any construction or other lien for work, labour, services or
materials supplied to or for the Tenant or for the cost of which the Tenant may be in
any way liable or claims therefore shall arise or be filed or any such prohibited
mortgage, charge, conditional sale agreement or other encumbrance shall attach, the
Tenant shall within 5 Business Days after receipt of notice thereof procure and
register the discharge thereof, including any certificate of action registered in
respect of any lien, by payment or in such other manner as may be required or
permitted by law and failing which the Landlord may make any payment into Court
required to procure and register the discharge of any such liens or encumbrances,
including any certificate of action registered in respect of any lien, and shall be
entitled to be reimbursed by the Tenant as provided in Section 15.3, and its right to
reimbursement shall not be affected or impaired if the Tenant shall then or
subsequently establish or claim that any lien or encumbrance so discharged was without
merit or excessive or subject to any abatement, set-off or defence.
	 
	 	(c)	 	The Landlord and the Tenant agree that any Work done in the Premises during the
Term by or on behalf of the Tenant shall not be done and shall be deemed not to have
been done at the request of the Landlord.

	8.5	 	Alterations by Landlord
	 
	 	 	The Landlord may from time to time, at its own expense, make alterations to the Building or
any part thereof and alterations to or relocations of the Common Facilities provided that:

	 	(a)	 	the Premises shall not be altered, relocated or interfered with in any
material way;
	 
	 	(b)	 	the Common Facilities shall not be altered or relocated to such an
extent as to materially reduce their convenience to the Tenant;
	 
	 	(c)	 	access and services to or benefiting the Premises shall not be reduced or
interrupted;
	 
	 	(d)	 	any alteration or relocation shall be such that a reasonably prudent owner of
the Development would make having regard to the type and age of the Development;

 

 

19

	 	(e)	 	the Landlord shall in the course of completing any such alterations or
relocation use reasonable commercial efforts so as not to materially affect the
visibility of the Tenant’s signage referred to in Section 7.7 of this Lease;
	 
	 	(f)	 	any alteration or relocation shall not materially affect the
Tenant’s business operations in the Premises; and
	 
	 	(g)	 	the Landlord shall repair any damage to the Premises, the Leasehold
Improvements and the furniture and equipment located in the Premises caused as a
result of the exercise of such rights.

ARTICLE 9.00 — REPAIRS

	9.1	 	Landlord’s Repairs
	 
	 	 	The Landlord shall throughout the Term operate, secure, maintain, repair and replace the
Building, including without limitation, the structural components and roof of the
Building, the Common Facilities and all base building mechanical, electrical and plumbing
systems and equipment in accordance with all applicable governmental laws, by-laws and
regulations and in a first class manner as would a prudent owner of a similar building,
of similar age, use and class in the downtown core of the City of Toronto, subject to the
Landlord’s right to charge back certain of such charges in Operating Costs.
	 
	9.2	 	Tenant’s Repairs
	 
	 	 	Subject to Section 9.5, the Tenant shall at its expense and throughout the Term keep the
Premises, the Leasehold Improvements and the trade fixtures therein and all electrical
and telephone outlets and conduits and all mechanical and electrical equipment within the
Premises in good condition and repair, reasonable wear and tear, Insured Damage and the
Landlord’s maintenance, repair and replacement obligations pursuant to this Lease only
excepted. All repairs by the Tenant shall be subject to Section 8.1.
	 
	9.3	 	Entry by Landlord to View State of Repair
	 
	 	 	The Landlord shall upon reasonable prior notice (except in the event of an emergency) be
entitled to enter and view the state of repair of the Premises. The Tenant will repair
according to notice as specified in Section 9.2.
	 
	9.4	 	Notice of Defects
	 
	 	 	The Tenant shall give to the Landlord prompt notice of any defect in the plumbing or
utility systems and equipment or any damage to the Premises or any part thereof howsoever
caused; provided that nothing herein shall be construed so as to require repairs to be
made by the Landlord except as expressly provided in this Lease.
	 
	9.5	 	Termination or Abatement after Damage

	 	(a)	 	If and whenever the Premises are destroyed or damaged by any cause
to the extent that, in the reasonable opinion of Landlord’s independent and duly
qualified architect (the “Architect”) to be given in writing to the Tenant within 60
days after the occurrence of such damage or destruction, they are unable to be
repaired or rebuilt within 180 days after such destruction or damage, then either
the Landlord or the Tenant may terminate this Lease by notice to the other, to be
given within 30 days after the giving of the Architect’s written opinion above

 

 

20

referred to, and the Tenant shall immediately thereupon surrender the Premises and
this Lease to the Landlord and Rent shall be apportioned to the date of such
destruction or damage (subject to the payment of Rent from the date of such
destruction or damage to the date of surrender in the same proportion that the part
of the Net Rentable Area of the Premises fit for occupancy by the Tenant until such
surrender is of the total Net Rentable Area of the Premises).

	 	(b)	 	If and whenever all or any substantial portion of the Building is destroyed
or damaged by reason of any cause (whether or not such portion includes all or any
part of the Premises) to such extent that:

	 	(i)	 	in the Architect’s reasonable opinion to be given to the
Tenant in writing within 60 days after the occurrence of such damage or
destruction, it is unable to be repaired or rebuilt within 180 days after such
destruction or damage; or
	 
	 	(ii)	 	the estimated cost (as estimated by the Architect) of
repairing or rebuilding the Development exceeds the proceeds of insurance
available to the Landlord for such purpose (or which would have been available
if the Landlord had insured in compliance with Section 10.1),

the Landlord may terminate this Lease upon not less than 30 days’ prior written
notice to the Tenant given within 90 days after the happening of such destruction or
damage and the Tenant shall immediately thereupon surrender the Premises and this
Lease to the Landlord;

	 	(iii)	 	if and to the extent that such destruction or damage has
rendered the Premises in whole or in part unfit for occupancy by the Tenant,
Rent shall abate from the date of such destruction or damage to the date of
surrender in the same proportion that the part of the Net Rentable Area of the
Premises unfit for occupancy is of the total Net Rentable Area of the Premises;
and

	 	(iv)	 	otherwise Rent shall be apportioned to the date of surrender.

	 	(c)	 	If and whenever the Premises are destroyed or damaged by reason of any cause
and this Lease shall not have been terminated, the Landlord shall, with all reasonable
diligence, make the repairs specified in Section 9.1 and the Tenant shall, with all
reasonable diligence and in compliance with Section 8.1, make all repairs to the
Premises specified in Section 9.2 and complete the Premises for occupancy for the
purpose described in Section 7.1 and in compliance with Section 7.5(b). If as a result
of any destruction or damage to the Premises which the Landlord is obligated to repair
pursuant to Section 9.1, then during the period commencing on the occurrence of such
destruction or damage and ending upon the date when both the repairs to the Premises
which the Landlord is obligated to make as aforesaid are completed sufficiently to
enable the Tenant to commence its repairs and the Tenant has been allowed a reasonable
period of time which is sufficient for the completion by it of the repairs it is
obligated to make as aforesaid with due diligence, Rent shall from time to time abate
in the same proportion that the part of the Net Rentable Area of the Premises from
time to time rendered unfit for such occupancy by reason of such destruction or damage
is of the total Net Rentable Area of the Premises.

 

 

 21

	9.6	 	No Claim by the Tenant
	 
	 	 	Except in respect of abatement of Rent as provided for in this Article, no claim for
compensation or damages, direct or indirect, shall be made by the Tenant by reason of the
loss of use, inconvenience or otherwise arising from the necessity of repairing any
portion of the Development however the necessity may arise so carried out with reasonable
diligence.
	 
	9.7	 	Tenant to Leave Premises in Good Repair
	 
	 	 	The Tenant shall leave the Premises and (subject to Sections 3.5, 16.27, 16.28, 16.29 and
16.30) the Leasehold Improvements at the expiration or other termination of the Term in
the condition and repair required of the Tenant under Section 9.2.

ARTICLE 10.00 — INSURANCE AND LIABILITY

	10.1	 	Landlord’s Insurance
	 
	 	 	Subject to its general availability, the Landlord shall effect and maintain during the
Term:

	 	(a)	 	“all risks” insurance which shall insure the Development against loss or
damage by perils now or hereafter from time to time embraced by or defined in a
standard all risks insurance policy;
	 
	 	(b)	 	boiler and machinery insurance on objects defined in a standard
comprehensive boiler and machinery policy against accidents as defined
therein;
	 
	 	(c)	 	loss of rental income insurance in an amount sufficient to replace
all Basic Rent and Additional Rent payable under the provisions of this Lease
for an indemnity period of a reasonable period of time;
	 
	 	(d)	 	comprehensive general liability insurance covering claims for personal
injury and property damage arising out of all operations in connection with the
management and administration of the Development; and
	 
	 	(e)	 	such other coverage, or increases in the amount of coverage, as the
Landlord may consider necessary.

	 	 	For greater certainty, the Tenant acknowledges that the Landlord is not obligated to
insure Leasehold Improvements in the Premises, except to the extent herein specifically
required. The insurance to be maintained by the Landlord shall be that which would be
carried by reasonably prudent owners of properties similar to the Development, all as
from time to time determined by insurance advisors selected by the Landlord and whose
written opinion shall be conclusive.

10.2 Tenant’s Insurance

	 	 	The Tenant shall, at its own expense, take out and keep in force during the Term:

	 	(a)	 	comprehensive insurance of the type commonly called general public
liability, which shall include coverage for personal injury, tenant’s legal
liability, non-owned automobile liability, bodily injury, death and property damage,
all on an occurrence basis with respect to the business carried on in the Premises
and the Tenant’s use and occupancy of the Premises and its use of the Common
Facilities or of any other part of

 

22

	 	 	 	the Building, with coverage for any one occurrence or claim of not less than
$5,000,000.00 or such other amount as the Landlord may reasonably require upon
not less than 10 days’ notice at any time during the Term, Which insurance shall
protect the Landlord in respect of claims as if the Landlord were separately
insured and which insurance shall contain a severability of interest provision
and a cross-liability provision;
	 
	 	(b)	 	insurance in respect of fire and such other perils as are from time to
time defined in the usual extended coverage endorsement covering the Leasehold
Improvements, trade fixtures and the furniture and equipment in the Premises for not
less than the full replacement cost thereof, which insurance shall provide that any
proceeds recoverable with respect to Leasehold Improvements shall be payable to the
Landlord and Tenant jointly (the Landlord and Tenant acknowledging and agreeing that
such proceeds shall be used and made available toward the repair or replacement of
the insured property if this Lease is not terminated pursuant to any other
provisions hereof and in the event this Lease is terminated such proceeds shall
become the absolute property of the Tenant); and
	 
	 	(c)	 	insurance against such other perils and in such amounts as the Landlord
may from time to time reasonably require upon not less than 60 days’ notice, such
requirement to be made on the basis that the required insurance is customary at the
time in the City of Toronto for tenants of buildings similar to the Building,
provided however, so long as the Tenant pursuant to this Lease is Loyalty Management
Group Canada Inc. or a corporation affiliated (as that term is defined as of the
date of this Lease in the Ontario Business Corporations Act) with Loyalty Management
Group Canada Inc. or a corporation formed as a result of a merger or amalgamation
involving Loyalty Management Group Canada Inc., the Tenant shall not be required to
take out contractual liability or business interruption insurance.

	10.3	 	Form of the Tenant’s Insurance
	 
	 	 	All insurance required to be maintained by the Tenant hereunder shall be on terms and
with insurers to which the Landlord has no reasonable objection. Each policy shall
contain an undertaking by the insurer that no material change adverse to the Landlord or
the Tenant will be made and the policy will not lapse or be cancelled or not be renewed,
except after not less than 30 days’ prior written notice to the Landlord of the intended
change, lapse, cancellation or non-renewal. The policies of insurance specified in
Sections 10.2(a) (as it relates to the Leasehold Improvements solely) and 10.2(b) shall
show the Landlord and its agent as additional insureds as their respective interests may
appear. The Tenant shall, upon request, furnish to the Landlord certificates as to the
insurance from time to time effected by the Tenant and its renewal or continuation in
force, together with evidence as to the method of determination of full replacement cost
of the Tenant’s Leasehold Improvements, trade fixtures, furniture and equipment. If the
Landlord reasonably concludes that the full replacement cost has been underestimated, the
Tenant shall forthwith arrange for any consequent increase in coverage required under
Section 10.2. If the Tenant fails to take out, renew or keep in force such insurance, or
if the certificates submitted to the Landlord pursuant to the preceding sentence are
unacceptable to the Landlord (or no such certificates are submitted within a reasonable
period after request therefore by the Landlord), then the Landlord may give to the Tenant
notice requiring compliance with this Section and specifying the respects in which the
Tenant is not then in compliance with this Section. If the Tenant does not within five
(5) Business Days (or such lesser period as the Landlord may reasonably require having
regard to the urgency of the situation), provide appropriate

 

23

	 	 	evidence of compliance with this Section, the Landlord may (but shall not be obligated
to) obtain some or all of the additional coverage or other insurance which the Tenant
shall have failed to obtain, without prejudice to any other rights of the Landlord under
this Lease or otherwise, and the Tenant shall pay all premiums and other costs incurred
by the Landlord forthwith upon demand.
	 
	10.4	 	Release of Landlord by the Tenant
	 
	 	 	The Tenant agrees that the Landlord and those for whom the Landlord is at law responsible
shall not be liable to any extent for any personal injury or death of or loss or damage
to any property belonging to the Tenant or its employees, invitees or licensees or any
other person in, on or about the Development, unless resulting from the act, fault,
omission or negligence of the Landlord or those for whom it is in law responsible or as a
result from a breach of the obligations of the Landlord under this Lease. In no event
shall the Landlord be liable for:

	 	(a)	 	any damage (other than Insured Damage) which is caused by steam, water,
rain or snow which may leak into, issue or flow from any part of the Development or
from the pipes or plumbing works, including the sprinkler system, thereof or from
any other place or quarter or for any damage caused by or attributable to the
condition or arrangement of any electric or other wiring or of sprinkler heads or
for any damage caused by anything done or omitted by any other tenant;
	 
	 	(b)	 	any act or omission (including theft, malfeasance or negligence) on the
part of any agent, contractor or person from time to time employed by it to perform
janitorial services, security services, supervision or any other work in or about
the Premises or the Development;
	 
	 	(c)	 	loss or damage however caused to money, securities, negotiable
instruments, papers or other valuables of the Tenant;
	 
	 	(d)	 	damage required to be insured against by the Tenant; or
	 
	 	(e)	 	any indirect or consequential damages suffered by the Tenant however
caused.

	 	 	The Tenant hereby further releases the Landlord and those for whom the Landlord is at law
responsible from all claims or liabilities in respect of damage required to be insured
against by the Tenant.

	10.5	 	Release of the Tenant by Landlord
	 
	 	 	The Landlord hereby releases the Tenant and those for whom the Tenant is at law
responsible from all claims or liabilities in respect of any damage which is Insured
Damage to the extent of the insurance proceeds actually receivable by the Landlord or
which would have been receivable by the Landlord had it maintained the insurance required
of it pursuant to this Lease.
	 
	10.6	 	Indemnity of Landlord by the Tenant
	 
	 	 	Except as provided in Section 10.5 and unless caused by or to the extent contributed to
by the act, fault, omission or negligence of the Landlord or those for whom it is in law
responsible or as a result of the breach by the Landlord of any of its obligations under
this Lease or any of its covenants, warranties or representations contained in this
Lease, the Tenant shall indemnify and save harmless the Landlord against and from any and
all expenses, costs, damages, suits, actions or liabilities arising or growing out of any
default by the Tenant hereunder and from all claims and demands of every kind and nature
made by any person or persons to or against the Landlord and/or its agent for

 

24

	 	 	all and every manner of costs, damages or expenses incurred by or injury or damage to
such person or persons or his, her or their property, which claims or demands may arise
howsoever out of the use and occupation of the Premises by the Tenant or any subtenant or
occupant authorized by the Tenant or by any assignee or sublessee thereof or any of the
above-mentioned or his, her or their servants, agents, assistants, employees, invitees or
other persons entering into the Building to go to the Premises or any part thereof, and
from all costs, counsel fees, expenses and liabilities incurred in or about any such
claim or any action or proceeding brought thereon.
	 
	10.7	 	Indemnity of Tenant by the Landlord
	 
	 	 	Except as provided in Section 10.4 and unless caused by or to the extent contributed to
by the act, fault, omission or negligence of the Tenant or those for whom it is in law
responsible or as a result of the breach by the Tenant of any of its obligations under
this Lease, the Landlord shall indemnify and save harmless the Tenant and those for whom
it is in law responsible against and from any and all expenses, costs, damages, suits,
actions or liabilities arising or growing out of any act, fault, omission or negligence
of the Landlord or those for whom it is in law responsible or the breach by the Landlord
of any of its obligations under this Lease or any of its covenants, warranties or
representations contained in this Lease and from all costs, counsel fees, expenses and
liabilities incurred in or about any such claim, action or proceeding brought thereon.

ARTICLE 11.00 — ASSIGNMENTS AND TRANSFERS

	11.1	 	Assignments, Subleases, Charges by the Tenant

	 	(a)	 	The Tenant shall not assign this Lease or sublet all or any part of
the Premises without the consent of the Landlord, which consent may not be
unreasonably withheld or delayed. Without limitation, it shall constitute reasonable
grounds for any withholding of consent by the Landlord that, in the Landlord’s
reasonable judgment:

	 	(i)	 	the proposed assignee or subtenant does not have a
satisfactory financial condition having regard to the obligations which it
will assume as assignee or subtenant; or
	 
	 	(ii)	 	the proposed assignee or subtenant is a tenant or subtenant of
other space in the Development; or
	 
	 	(iii)	 	the proposed assignee or subtenant does not have an
established good reputation in the business community; or
	 
	 	(iv)	 	it is intended or likely that it will use any part of the
Premises for purposes which are not permitted by this Lease or which are not
acceptable to the Landlord, acting reasonably, or which are not compatible with
the other businesses or activities which are being carried on in the
Development; or
	 
	 	(v)	 	where the return to the Tenant on any proposed assignment or
subletting is greater than the amounts payable by the Tenant hereunder and the
Tenant has not agreed to pay one-half of such excess to the Landlord (after
deducting the Tenant’s reasonable costs in procuring any such assignment or
subletting, including, without limitation, commissions, legal fees, the value
of rent-free periods, inducements and improvement allowances granted to the
assignee or sublessee and any other direct costs incurred by the Tenant in
affecting the said assignment or subletting).

 

25

	 	(b)	 	Without limitation, the Tenant shall for purposes of this Section be considered
to have, assigned or sublet in any case where it permits the Premises or any portion
thereof to be occupied by a person or persons other than the Tenant, its employees and
others engaged in carrying on the business of the Tenant, whether pursuant to
assignment, subletting, license or other right, and shall also include any case where
any of the foregoing occurs by operation of law.
	 
	 	(c)	 	DELETED INTENTIONALLY.
	 
	 	(d)	 	The Landlord shall also have the right of approval of any marketing of space by
the Tenant.
	 
	 	(e)	 	If the Landlord’s consent is given, the Tenant shall assign or sublet, as the
case may be, but only upon the terms set out in the offer submitted to the Landlord and
not otherwise. Such assignment or subletting shall occur within 180 days after the
Tenant’s request for consent and only upon any assignee entering into an agreement
directly with the Landlord and in a form satisfactory to the Landlord, acting
reasonably, to perform, observe and keep each and every covenant, proviso, condition
and agreement in this Lease on the part of the Tenant to be performed, observed and
kept, including payment of Rent from and after the effective date of any such
assignment.
	 
	 	(f)	 	The Tenant shall have the right without the consent of the Landlord, provided
that the Tenant has first given notice to the Landlord, to assign or sublet the whole
or any portion of the Premises to:

	 	(i)	 	a corporation affiliated (as that term is defined as of the
date of this Lease in the Ontario Business Corporations Act) with the Tenant;
or
	 
	 	(ii)	 	a purchaser of all or substantially all of the Tenant’s business,

	 	 	 	provided that any assignee has entered into an agreement directly with the Landlord
and in a form satisfactory to the Landlord, acting reasonably, to perform, observe
and keep each and every covenant, proviso, condition and agreement in this Lease on
the part of the Tenant to be performed, observed and kept, including payment of Rent
from and after the effective date of such assignment.
	 
	 	(g)	 	All costs of the Landlord incurred with respect to any assignment or
sublease by the Tenant shall be paid by the Tenant forthwith after
demand.
	 
	 	(h)	 	The Tenant shall not require the Landlord’s consent respecting a merger or
amalgamation with another corporation and same shall not be considered to be an
assignment or subletting. In addition, any security agreement entered into by the
Tenant with a lender shall not require the Landlord’s consent and same shall not be
considered to be an assignment or subletting or to cause a default of any of the
Tenant’s obligations under this Lease. Further, any change in the effective voting
control of the Tenant shall be deemed not to constitute an assignment or subletting and
accordingly same may be effected without the prior written consent and without any
notice to the Landlord.

	11.2	 	Landlord’s Rights of Cancellation Deleted Intentionally

 

26

	11.3	 	Continuing Obligations

	 	(a)	 	No consent by the Landlord to any assignment or subletting shall release
or relieve the Tenant from any of its obligations hereunder.
	 
	 	(b)	 	No consent by the Landlord to any assignment or subletting shall be
construed to mean that the Landlord has consented or will consent to any further
assignment or subletting which shall remain subject to the provisions of this
Article.

	11.4	 	Dealings by Landlord
	 
	 	 	The Landlord may sell, transfer, mortgage, encumber or otherwise deal with the
Development or any portion thereof or any interest of the Landlord therein, in every case
without the consent of the Tenant and without restriction. To the extent that any
purchaser or transferee from the Landlord has covenanted and agreed in writing with the
Tenant to become bound by and perform the covenants and obligations of the Landlord under
this Lease, the Landlord shall without further written agreement be freed and relieved of
liability with respect to such covenants and obligations to the extent that same relates
to the period from and after the effective date of any such sale or transfer. If the
Landlord assigns or transfers this Lease it shall obtain, as a condition thereof, the
written agreement of the assignee or transferee in favor of the Tenant whereby the
assignee or transferee covenants and agrees in writing with the Tenant to become, bound
by and perform the covenants and obligations of the Landlord under this Lease as if an
original signatory hereto.
	 
	11.5	 	Subordination and Attornment
	 
	 	 	The Tenant acknowledges that this Lease is, at the option of any mortgagee or chargee,
subject and subordinate to any and all ground leases, mortgages or charges (including
deeds of trust and mortgage securing bonds, all indentures supplemental thereto or any
other instruments of financing, refinancing or collateral financing) which may now or
hereafter affect the Development or any part thereof and to all renewals, modifications,
consolidations, replacements and extensions thereof, so long as the holder(s) of any such
ground leases, mortgages or charges first grants to the Tenant a written non-disturbance
agreement providing that so long as the Tenant is not in default of any material covenant
under this Lease, the Tenant shall be entitled to remain undisturbed in its possession of
the Premises, subject to the terms, covenants and conditions of this Lease (a
“Non-Disturbance Agreement”). Subject to the Tenant first obtaining a Non-Disturbance
Agreement from any party to which its rights under this Lease are to be subordinated to,
the Tenant agrees to execute promptly any certificate or instrument in confirmation of
such subordination and will, if requested, attorn to such mortgagee or charges on the
terms, covenants and conditions contained in this Lease, and the Tenant hereby
constitutes the Landlord its agent and attorney for the purpose of executing any such
certificate or instrument.
	 
	 	 	Within six (6) months after November 4th, 2005, the Landlord shall obtain a
Non-Disturbance Agreement from the holders of any existing ground leases, mortgages,
charges or other interest in the Development having priority to the Tenant’s rights under
this Lease.

ARTICLE 12.00 — ESTOPPEL CERTIFICATES. REGISTRATION

	12.1	 	Estoppel Certificates
	 
	 	 	Each of the Landlord and the Tenant agrees that it will at anytime and from time to time
upon not less than 10 days’ notice execute and deliver to the

 

27

	 	 	other (and, if required, to any prospective purchaser or mortgagee of the Development) a
certificate in writing as to the status at that time of this Lease, including as to
whether this Lease is unmodified and in full force and effect (or if modified, stating
the modification and that the same is in full force and effect as modified), the amount
of the Rent then being paid hereunder, the dates on which the same, by installments or
otherwise and other charges hereunder, have been paid, whether or not there is any
existing default on the part of the other of which it has notice and any other matters
pertaining to this Lease as to which the other shall request a statement.
	 
	 	 	If any such certificate requested by the Landlord is not returned to the Landlord within
10 days after its request therefore, the Landlord shall have the right and is hereby
appointed by the Tenant as its agent to prepare and execute such certificate.
	 
	12.2	 	Registration on Title
	 
	 	 	The Tenant shall not register this Lease in full on the title to the Development. If the
Tenant wishes to register a notice of this Lease, the Tenant shall deliver the form of
notice to the Landlord for its prior approval, such approval not to be unreasonably
withheld or delayed.
	 
	 	 	The Tenant agrees that it will, at its sole expense, discharge and withdraw from title
any such registration within 30 days after the expiration or sooner termination of this
Lease. If such registration is not discharged and withdrawn during the aforesaid time,
the Landlord shall have the right and is hereby appointed by the Tenant as its agent to
prepare, execute and register such documentation as is required to discharge and withdraw
any such registration.

ARTICLE 13.00 — UNAVOIDABLE DELAYS

Whenever and to the extent that either the Landlord or the Tenant is unable to fulfill or is
delayed or restricted in the fulfillment of any obligation hereunder in respect of the supply or
provision of any service or utility or the doing of any work or the making of any repairs by reason
of being unable to obtain the material, goods, equipment, service, utility or labor required to
enable it to fulfill such obligation, or by reason of any statute, law, by-law or order-in-council
or any regulation or order passed or made pursuant thereto, or by reason of the order or direction
of any legislative, administrative or judicial body, controller or board, or any governmental
department or any governmental officer or other authority having jurisdiction, or by reason of its
inability to procure any license or permit required therefore, or by reason of not being able to
obtain any permission or authority required therefore, or by reason of any strikes, lockouts,
slow-downs or other combined action of workmen, or shortages of material, or any other cause beyond
its control, other than any insolvency, lack of funds or other financial cause of delay, the
Landlord or the Tenant, as the case may be, shall be relieved from the fulfillment of such
obligation so long as such cause continues provided always that (except as may be expressly
provided in this Lease) the Tenant shall not be entitled to any compensation for any inconvenience,
or nuisance or discomfort thereby occasioned, or to cancel or terminate this Lease or to any
abatement of Rent accruing due after the Commencement Date.

ARTICLE 14.00 — LANDLORD’S ACCESS TO PREMISES

	14.1	 	Inspection and Repair
	 
	 	 	The Landlord and its authorized agents and employees shall have the right at any time and
from time to time to enter the Premises for the purpose of inspection, providing janitor
service, maintenance, making repairs, alterations or improvements to the Development or
to have access to utilities and

 

28

	 	 	services and the Tenant shall provide free and unhampered access for such purpose . The
Landlord in exercising its rights hereunder shall, save and except for the purposes of
providing janitor services and save in the event of an emergency, provide the Tenant with
reasonable prior notice thereof, shall carry out such maintenance, repairs, alterations
and improvements with due diligence and in such a manner so as to minimize interference
with the Tenant’s business operations in the Premises. The Landlord shall be responsible
at its sole cost and expense to repair any damage to the Premises, the Leasehold
Improvements and the furniture and equipment located therein caused as a result of the
exercise of such rights.
	 
	14.2	 	Right to Exhibit Premises
	 
	 	 	The Landlord and its authorized agents and employees shall have the right upon reasonable
prior notice to exhibit the Premises to prospective tenants during business hours during
the last 15 months of the Term and with a representative of the Tenant in attendance. The
Landlord and its authorized agents and employees shall also have the right upon
reasonable prior notice to enter upon the Premises at all reasonable hours during the
Term and with a representative of the Tenant in attendance for the purpose of exhibiting
the Development to any prospective purchaser or mortgagee thereof.

ARTICLE 15.00 — DEFAULT

	15.1	 	Events of Default
	 
	 	 	Each of the following shall be an event of default of the Tenant:

	 	(a)	 	whenever the Tenant defaults in the payment of any Rent and such default
continues for five Business Days after notice to the Tenant; or
	 
	 	(b)	 	whenever the Tenant defaults in the performance of any of its other
obligations hereunder and such default can be remedied by the Tenant, but is not
remedied within a period next after notice and which period shall be:

	 	(i)	 	if the default could reasonably be remedied within 30 days
after notice and provided the Tenant has commenced to remedy such failure within
10 Business Days after notice and proceeds thereafter diligently and
continuously to remedy it, 30 days;
	 
	 	(ii)	 	if the default could not reasonably be remedied within 30 days
after notice and provided the Tenant has commenced to remedy such failure not
later than 10 Business Days after notice and proceeds thereafter diligently and
continuously to remedy it, that number of days after notice which would
reasonably suffice for the remedying of such default if the Tenant had commenced
to remedy such default within 10 Business Days after notice and proceeded
thereafter diligently and continuously to remedy it; and
	 
	 	(iii)	 	in any case where the Tenant does not commence to remedy such
default within 10 Business Days after notice, 10 Business Days; or

	 	(c)	 	whenever the Tenant defaults in the performance of any of its other
obligations hereunder and such default cannot be remedied by the Tenant; or
	 
	 	(d)	 	if the Tenant is adjudicated to be insolvent or makes an assignment for
the benefit of creditors or in bankruptcy or is declared bankrupt, or takes the
benefit of any legislation that may be in force for bankrupt or

 

29

	 	 	 	insolvent debtors or if any proceedings are taken by or against the Tenant
under any winding-up legislation and such adjudication, assignment, declaration or
proceedings are not set aside or revoked within 60 days after the making or taking
of the same, or if the Tenant makes any sale of its assets under the Bulk Sales
Act of Ontario, except to a successor in conjunction with a permitted assignment
of this Lease; or
	 
	 	(e)	 	if the Premises are used by any other person or persons other than
the Tenant or other person or persons entitled to the use thereof or for any other
purpose than that for which the same were let, in each case without the prior
written consent of the Landlord where required under this Lease.

	15.2	 	Remedies by Landlord
	 
	 	 	Upon any event of default of the Tenant, in addition to any remedy which the Landlord
may have by this Lease or at law or in equity, the Landlord may, at its option:

	 	(a)	 	in the event of a default described in Section 15.1(d) provide by notice
to the Tenant that the current month’s Rent and Rent for the next ensuing 3 months
shall thereupon become immediately due and payable; and/or
	 
	 	(b)	 	re-enter and take possession of the Premises as though the Tenant is
overholding after the expiration of the Term and the Term shall be forfeited and
void in such event; and/or
	 
	 	(c)	 	enter the Premises as agent of the Tenant, either by force or otherwise,
without being liable for any prosecution therefore and without being deemed to have
terminated this Lease and relet the Premises or any part thereof as the agent of the
Tenant and receive the rent therefore to be applied on account of the Rent; and/or
	 
	 	(d)	 	exercise its right of distress and the Tenant hereby waives any present
or future limitation on the Landlord’s right of distress; and/or
	 
	 	(e)	 	terminate this Lease and re-enter and take possession of the Premises in
which event the Landlord shall be under an obligation to mitigate its damages and
provide by notice to the Tenant for an immediate payment by the Tenant of an amount
equal to the Present Value as of the date of such termination of the excess, if any,
of the amount of Rent required to be paid under this Lease for the remainder of the
then current Term over the then reasonable rental value of the Premises for the
remainder of the then current Term.

	15.3
	 	 	Additional Self-help Remedy of Landlord
	 
	 	In addition to all other remedies the Landlord may have by this Lease at law or in
equity, if the Tenant does not perform any of its obligations hereunder, the Landlord,
may at its option, perform any of such obligations after 5 Business Days notice to the
Tenant or in the event of an emergency, without notice and, in such event, the cost of
performing any of such obligations, plus an administrative charge of 15% of such cost,
shall be payable by the Tenant to the Landlord forthwith on demand, together with
interest at the Rate of Interest from the date of the performance of any of such
obligations by the Landlord to the date of payment by the Tenant.

 

30

	15.4	 	Legal Costs
	 
	 	 	The Tenant hereby agrees’ to pay to the Landlord within 5 Business Days after demand all
legal fees on a solicitor and his own client basis incurred by the Landlord for the
enforcement of any rights of the Landlord under this Lease or in the enforcement of any
of the provisions of this Lease or in the obtaining of possession of the Premises or for
the collection of any moneys from the Tenant.
	 
	 	 	The Landlord hereby agrees to pay to the Tenant within 5 Business Days after demand all
legal fees on a solicitor and his own client basis incurred by the Tenant for the
enforcement of any rights of the Tenant under this Lease or in the enforcement of any of
the provisions of this Lease or for the collection of any moneys from the Landlord.
	 
	15.5	 	Remedies Cumulative
	 
	 	 	The Landlord or Tenant, as the case may be, may from time to time resort to any or all of
the rights and remedies available to it in the event of any default hereunder by the
other, either by any provision of this Lease or by statute or at law or in equity, all of
which rights and remedies are intended to be cumulative and not alternative, and the
express provisions hereunder as to certain rights and remedies are not to be interpreted
as excluding any other or additional rights and remedies available to the Landlord or
Tenant, as the case may be, at law or in equity.
	 
	15.6	 	Non-Waiver
	 
	 	 	Any condoning, excusing or overlooking by either the Landlord or the Tenant of any
default by the other at any time or times in respect of any obligation of the other
herein shall not operate as a waiver of the non-defaulting party’s rights hereunder in
respect of such default or so as to defeat or affect in any way the rights of the
non-defaulting party in respect of any such continuing or subsequent default by the
defaulting party. No waiver shall be implied by anything done or omitted by a party. Any
waiver of a particular default shall not operate as a waiver of any subsequent or
continuing default.
	 
	15.7	 	Self-help Remedy of Tenant
	 
	 	 	In the event the Landlord should at any time during the Term of this Lease fail to (i)
make any payment required of it pursuant to this Lease within fifteen (15) days of demand
therefor by the Tenant; or (ii) perform any of its obligations hereunder and should such
failure adversely affect access to or egress from the Premises or the Tenant’s business
operations therein and should the Landlord fail to commence and to proceed diligently
with the performance of such obligation within fifteen (15) days following written notice
from the Tenant to the Landlord thereof, then in such event, the Tenant shall, without
obligation to do so, be entitled to make any such payment or perform any such obligation
at the cost of the Landlord to be paid by it to the Tenant within ten (10) days after
receipt of written notice of such cost accompanied by written evidence of the amount
thereof. In the event of default of such payment by the Landlord, the Landlord shall pay
interest to the Tenant on the unpaid cost at the Rate of Interest from the due date until
the date of payment in full and the Tenant shall, without prejudice to and in addition to
any other remedy available to the Tenant under this Lease or at law as a consequence
thereof, be entitled to deduct such unpaid cost incurred by it, together with interest as
aforesaid, from the Rent payable pursuant to this Lease to a maximum aggregate amount of
Two Hundred Thousand Dollars ($200,000.00) (which amount shall increase by three percent
(3%) compounded annually on each anniversary date of the Commencement Date).

 

31

ARTICLE 16.00 — GENERAL PROVISIONS 

	16.1	 	Entire Agreement
	 
	 	 	This Lease contains all of the terms and conditions of the agreement between the Landlord
and the Tenant relating to the matters herein provided and supersedes all previous
agreements or representations of any kind, written or verbal, made by anyone in reference
thereto. There shall be no amendment hereto unless in writing and signed by the party to
be bound.
	 
	16.2	 	Schedules
	 
	 	 	The Schedules to this Lease form a part of this Lease.
	 
	16.3	 	Planning Act
	 
	 	 	This Lease is subject to compliance, if necessary, with the Planning Act of Ontario.
	 
	16.4	 	Survival of Obligations
	 
	 	 	Any obligation of a party which is unfulfilled on the termination of this Lease shall
survive until fulfilled.
	 
	16.5	 	Severability of Illegal Provision
	 
	 	 	If any provision of this Lease is or becomes illegal or unenforceable, it shall during
such period that it is illegal or unenforceable be considered separate and severable from
the remaining provisions of this Lease, which shall remain in force and be binding as
though the said provision had never been included.
	 
	16.6	 	Governing Law
	 
	 	 	This Lease shall be governed by the laws applicable in the Province of Ontario.
	 
	16.7	 	No Partnership
	 
	 	 	Nothing contained herein shall be deemed to create any relationship between the parties
hereto other than the relationship of landlord and tenant.
	 
	16.8	 	Number, Gender, Joint and Several Liability
	 
	 	 	The words “Tenant”, “assignee” and “sublessee” and personal pronouns relating thereto and
used in conjunction therewith shall be read and construed as “Tenant” or “Tenants”,
“assignee” or “assignees” and “sublessee” or “sublessees”, respectively, and “his”,
“her”, “it”, “its” and “their” as the number and gender of the party or parties referred
to in each case require and the number of the verb agreeing therewith shall be considered
as agreeing with the said word or pronoun so substituted. If at any time there is more
than one Tenant together or in succession, they shall be jointly and severally liable for
all of the obligations of the Tenant hereunder.
	 
	16.9	 	Captions
	 
	 	 	The captions for Articles and Sections of this Lease are for convenience only and are not
to be considered a part of this Lease and do not in any way limit or amplify the terms
and provisions of this Lease.

 

32

	16.10	 	Time of Essence
	 
	 	 	Time shall be of the essence of this Lease.
	 
	16.11	 	Landlord’s Agent
	 
	 	 	The Landlord may perform any of its obligations or exercise any of its rights hereunder
through such agency as it may from time to time determine and the Tenant shall as from
time to time directed by the Landlord pay to any such agent any moneys payable hereunder
to the Landlord.
	 
	16.12	 	Accounting Principles
	 
	 	 	All calculations referred to herein shall be made in accordance with generally accepted
accounting principles and practices applicable to the real estate development industry
and applied on a consistent basis.
	 
	16.13	 	Other Leases in Building — INTENTIONALLY DELETED
	 
	16.14	 	Notices and Consents, Etc.
	 
	 	 	Any demand notice or other communication (the “Communication” ) to be given in connection
with this Agreement shall be given in writing and shall be given by personal delivery,
telecopier transmission or by mailing by registered mail with postage thereon, fully
prepaid in a sealed envelope addressed to the intended recipient as follows:

	 	(a)	 	to the Landlord, at:

	 	 	 
	161 Eglinton Avenue East
	Suite 201
	Toronto, Ontario M4P 1J5
	 
	 	 
	Attention:

	 	Moni Lustig
	Telecopier No: (416) 506-1306

	 	(b)	 	to the Tenant, at:

	 	 	 
	Prior to the Commencement Date:
	 
	4110 Yonge Street
	Suite 200 Toronto,
	Ontario M2P 2B7
	 
	 	 
	Attention:

	 	Michael Kline
	 

	 	Senior Vice-President, Legal Services and
	 

	 	Secretary
	 
	 	 
	Telecopier No.: (416) 733-2876
	 
	 	 
	After the Commencement Date:
	 
	 	 
	the Premises
	 
	 	 
	Attention: Michael Kline
	 

	 	Senior Vice-President, Legal Services and
	 

	 	Secretary

	 	 	 	or to such other addresses, telecopier number or individual as may be designated by
a Communication given by a party to the other parties as aforesaid. Any
Communication given by personal delivery shall be

 

33

	 	 	conclusively deemed to have been given on the day of actual delivery thereof, if given by
registered mail on the 2nd Business Day following the deposit thereof in the mail and if
given by telecopier transmission, on the Business Day following the day on which it was
telecopied. If the party giving any Communication knows or reasonably knows of any
difficulties with the postal system which might effect the delivery of mail, any such
Communication shall not be mailed but shall be given by personal delivery or by telecopier
transmission.
	 
	16.15	 	Further Assurances
	 
	 	 	Each party agrees to make such further assurances as may be reasonably required from time
to time by the other to more fully implement the true intent of this Lease.
	 
	16.16	 	Environmental
	 
	 	 	The Landlord covenants that as of the date hereof, and during the Term, the Landlord shall
not permit within the Premises, Building, the Lands and all appurtenances thereto, any and
all materials proscribed or banned pursuant to environmental statutes, laws, orders, and
regulations of competent jurisdiction (individually and collectively the “Laws”), and that
should it be shown that the Building, the Lands or Premises (other than by virtue of the
Tenant’s acts) contain any such material(s) beyond acceptable governmental levels, the
Landlord shall forthwith remove same, or deal with same in accordance with all applicable
Laws, in good and proper manner, in accordance with all proper procedures, and certify via
independent environmental engineers as to completion of same, all such work to be carried
out by the Landlord at its sole cost, without reimbursement by the Tenant. Except as
specifically disclosed herein, the Landlord warrants that to the best of its knowledge and
belief the Building, the Lands and the Premises contains no such material beyond acceptable
governmental levels. This covenant and all obligations in connection therewith shall be
ongoing and shall bind Landlord’s successors and assigns.
	 
	16.17	 	Financial Information
	 
	 	 	Tenant acknowledges and agrees that commencing in the fiscal year 2006 it will provide, at
Landlord’s request from time to time, a copy of the Tenant’s most recent annual financial
statements (such financial statements of the Tenant to be substantially in the form
reviewed by Landlord in respect of the Tenant’s year end December 2004) together with a
letter from the Tenant’s parent’s Senior Vice-President, Controller certifying that such
financial statements are those used in the preparation of the consolidated financial
statements of the Tenant’s parent company, Alliance Data Systems Corporation.
	 
	16.18	 	Letter of Credit
	 
	 	 	The Tenant agrees to take out and maintain within five (5) Business Days of unconditional
acceptance of the Offer between the parties until the later of thirty (30) days following
occupancy of the Premises by the Tenant, or thirty (30) days after the Commencement Date,
an irrevocable Letter of Credit from a Schedule A Bank in the amount of two million dollars
($2,000,000.00 CAD). This Letter of Credit shall be in the Landlord’s name, who upon any
non-payment of Basic Rent and/or Additional Rent by the Tenant shall have the unfettered
right to draw down the amount of such non-payment under the Letter of Credit, without
prejudice to any other rights the Landlord may have under this Lease.

 

34

	16.19	 	Force Majeure
	 
	 	 	If either, the completion of the Landlord’s Work is delayed beyond the Access Date, or
the completion of the Tenant’s Work is delayed beyond the Commencement Date, for reason
of strike, lockout, labor troubles, inability to procure materials, failure of power,
restrictive governmental laws, riots, insurrection, war or other reason of a like nature
not the fault of the party delayed in performing work or doing acts under the terms of
this Lease, then the Commencement Date shall be delayed by until such time as the
Tenant’s Work is substantially completed, and all other applicable dates in this Lease
with the Landlord shall be adjusted accordingly. In the event of a change in the Access
Date or the Commencement Date as determined in accordance with the foregoing the parties
shall execute an acknowledgement of same.
	 
	16.20	 	Building Systems
	 
	 	 	The Landlord represents and warrants that the schedule attached hereto as Schedule “F”,
Building Systems Review, accurately represents the Building’s systems and improvements,
as of August 28, 2005, and the Tenant can rely on such information.
	 
	16.21	 	No Requirement to Occupy
	 
	 	 	During the Term, the Tenant shall be permitted to vacate all or a portion of the
Premises. Should the Tenant vacate the Premises, it shall maintain all its financial
obligations, as if it were in occupancy. The Tenant shall have the right to resume
occupancy of the Premises at anytime without notice to the Landlord.
	 
	16.22	 	Sale and Demolition
	 
	 	 	The Landlord shall not have the right of early termination in the event of any sale,
redevelopment, renovation or demolition of the Building.
	 
	16.23	 	Window Blinds
	 
	 	 	The Tenant shall have the right to replace Building Standard window blinds in the
Premises with a new style of window covering. The Tenant shall provide details of such
window treatment to the Landlord for its review and approval, such approval not to be
unreasonably withheld or delayed.
	 
	16.24	 	Parking
	 
	 	 	The Landlord shall make available to the Tenant, upon 30 days written notice, underground
unreserved parking spaces located in the parking garage of the Building throughout the
Term, as is proportionate to the Proportionate Share of the Premises in the Building,
(ie. Rentable Area of the Premises as it exists from time to time divided by the Rentable
Area of the Building (322,358 square feet), which as of the Commencement Date will be 98
unreserved parking spaces), at a charge of $185.00 per month per space during the first
year of the Term (increased on each anniversary date of the Commencement Date by the
percentage increase in the Consumers Price Index, All Items for Toronto, as published by
Statistics Canada) plus applicable taxes. Such rental shall be payable by the Tenant to
the Landlord on the first day of each month of the Term. Partial months’ rent owing shall
be calculated and paid on a pro rated basis. All such underground unreserved parking
spaces shall be made available to the Tenant on a 24 hour, 7 day a week basis.

 

35

	16.25	 	Right of First Refusal
	 
	 	 	In addition to the Tenant’! rights under Section 16.41 herein during the period
commencing upon November 4th, 2005 and throughout the Term (save and except
with respect to the 12th floor of the Building for which the period shall commence on the
date the Additional Premises have been determined pursuant to Section 16.41(b) hereof and
only if the Additional Premises as so determined do not consist of the 12th floor of the
Building and shall continue throughout the balance of the Term), and subject to any
rights in existence as of August 29, 2005 in favor of the tenants of the Building as of
August 29, 2005 and the respective successors and assigns of such tenants (which existing
rights in favor of such tenants are set out in Schedule “I” of this Lease), the Tenant
shall, provided it is not in default, have an ongoing right of first refusal to lease all
or any part of any office space that is located on the 12th through 18th floors in the
Building to a maximum of 35,396 square feet of Rentable Area (the “Right of First
Refusal”).
	 
	 	 	During the period commencing upon November 4th, 2005 and during the Term of
this Lease (save and except with respect to the 12th floor of the Building for which the
period shall commence on the date the Additional Premises have been determined pursuant
to Section 16.41(b) hereof and only if the Additional Premises as so determined do not
consist of the 12th floor of the Building and shall continue throughout the balance of
the Term), if the Landlord receives an acceptable written bona fide offer from an arm’s
length third party to lease all or any part of any office space that is located on the
12th through 18th floors in the Building, then the Landlord will notify the Tenant in
writing of the terms of such acceptable written offer to lease (the “Acceptable Offer to
Lease”). The Tenant shall have five (5) Business Days from receipt of such notice to
unconditionally exercise its Right of First Refusal, in writing, delivered to Landlord,
to lease that portion of the Building covered by the Acceptable Offer to Lease on the
same terms and conditions as provided for in such offer, less any commissions. It is
understood and agreed that the term of any space leased under this Right of First Refusal
will be coterminous with the Term for the Premises, and any renewal(s) or extension(s)
thereof.
	 
	16.26	 	Option to Extend
	 
	 	 	If the Tenant is not then in default (after notice of default has been provided and time
to remedy such default has passed) at the notice date or the commencement of the
applicable extension period of any covenants, conditions and agreements herein reserved
and contained and on the part of the Tenant to be paid and performed, Landlord will, upon
the Tenant’s request in writing, given at least fifteen (15) months and not more than
twenty (20) months prior to the expiration of the then current Term, grant to the Tenant
or its permitted assigns or transferees two (2) successive options to extend this Lease
(on the same terms and conditions including, without limitation, the provisions of
Section 16.25 of this Lease, each for a further five (5) years, save and except that
there shall be no further rights to extend beyond the second of such extensions and save
and except that the Basic Rent payable during the applicable extension period shall be
mutually agreed upon between the parties at least four (4) months prior to the expiry of
the then current Term, and shall be based on the then current fair market rent for the
Premises, taking into account that the Tenant is receiving no tenant inducements, no
Landlord’s Work, and taking into consideration the age of the Leasehold Improvements in
the Premises and premises similar to the Premises which are comparable in size, location,
type, and condition, for tenants leasing similar premises of a similar size and for a
similar term.
	 
	 	 	In the event that a new Basic Rent is not agreed upon at least four (4) months prior to
the expiry of the then current Term, the Basic Rent for the applicable extension period
shall be settled by a single arbitrator pursuant to the

 

36

	 	 	Arbitration Act, S.O. 1991 c.17 as amended or replaced, and shall be equal to the then
current market rent for the Premises, taking into account that the Tenant is receiving no
teniht inducements, no Landlord’s Work, and taking into consideration the age of the
Leasehold Improvements in the Premises and premises similar to the Premises which are
comparable in size, location, type, and condition, for tenants leasing similar premises
of a similar size and for a similar term. The expense of arbitration shall be borne
equally by the Landlord and the Tenant, except that each party shall be responsible for
its respective solicitor’s and experts’ fees and witnesses. It is understood and agreed
that the arbitrator shall be qualified by education, experience, and training to make a
decision on the matter being arbitrated.
	 
	16.27	 	Roof Mounted Communication Equipment
	 
	 	 	For the Term, the Tenant shall have the right, exercisable at its option, risk and
expense to install and maintain communication equipment on the roof of the Building, for
its own use. The Landlord will provide, at no cost or expense to the Tenant, a mutually
agreeable location for the installation. There shall be no ongoing charge for the space
required for such communication equipment. The Landlord shall approve the size and method
of installation of the communication equipment, such approval not to be unreasonably
withheld or delayed. Such work to install and maintain any roof mounted communication
equipment shall be in accordance with the terms of this Lease. Upon expiration or earlier
termination of the Term, the Tenant, at its sole cost and expense, shall be obliged to
remove said equipment and repairing damage caused by said removal. The Tenant shall
co-operate with the Landlord, and shall remove and/or relocate such equipment, if
required to do so, for the purpose of repairs and maintenance of the Building.
	 
	16.28	 	Roof Mounted Emergency Power Generator Equipment
	 
	 	 	For the Term, the Tenant shall have the right, exercisable at its option, to install and
maintain on the roof of the Building, at its cost and expense, an emergency generator
(generator will be self-contained, and include sound mitigation and an oil tank), a fuel
tank in the lowest parking level of the Building, and fuel lines to supply such emergency
generator, all to serve the Tenant’s electrical requirements. The Landlord will provide,
at no cost or expense to the Tenant, mutually agreeable locations for the installation of
the Tenant’s emergency generator, and associated fuel tank. There shall be no ongoing
charge for the space required for the Tenant’s own generator, fuel tank, or for the
Tenant’s access to conduit or riser space required to connect to such generator. Such
work to install and maintain a generator shall be in accordance with the terms of this
Lease. Upon expiration or earlier termination of the Term, the Tenant, at its sole cost
and expense, shall be obliged to remove said equipment and repairing damage caused by
said removal.
	 
	16.29	 	Internal Cooling Unit(s)
	 
	 	 	For the Term, the Tenant shall have the right, exercisable at its option, to install and
maintain a supplemental condenser water system in the Premises, with heat rejection in
the loading dock or on the roof of the Building. It is expected that the Tenant will
require roughly fifty (50) tons of cooling to service the Tenant’s equipment rooms, 24/7
cooling zones, and to supplement the base building system in the Premises, where the
Tenant’s cooling loads are intensive. The Landlord shall permit the Tenant to access
Building’s municipal water to service the Tenant’s air-conditioning system. The Landlord
will provide, at no cost or expense to the Tenant, mutually agreeable locations for the
installation of such heat rejection equipment, and distribution pumps, and access to
conduit or riser space required to connect to such cooling units, such installation to be
at the sole cost and expense of the Tenant. There shall

 

37

	 	 	be no ongoing charge for the space required for such heat rejection equipment, and
distribution pumps, and any conduit or riser space required for such installation. Upon
expiration or earlier termination of the Term, the Tenant, at its sole cost and expense,
shall be obliged to remove said equipment and repairing damage caused by said removal.
The Tenant shall install at the Tenant’s sole cost and expense check meters for all
utility consumption for the above-mentioned internal cooling units.
	 
	16.30	 	Restoration
	 
	 	 	Subject to Sections 3.5, 16.27, 16.28 and 16.29, the Tenant shall not be responsible for
the restoration of the Premises or the removal of any Leasehold Improvements, the Tenant
cabling or wiring, in the Premises, at the expiry or earlier termination of this Lease.
	 
	16.31	 	Leasehold Improvements
	 
	 	 	The Leasehold Improvements, fixtures, furnishings and equipment installed or placed in or
on the Premises by or on behalf of the Tenant, howsoever affixed (other than the Building
and its systems, and equipment, affixed thereto and forming part thereof), will be the
personal property of the Tenant, during the Term, after which time same shall subject to
Section 3.5 of this Lease become the property of the Landlord.
	 
	16.32	 	Building Access
	 
	 	 	The Landlord shall allow the Tenant, its agents, clerks, servants, employees and other
persons transacting business with it to have access to the Premises by the main entrance
or entrances of the Building and Premises and to use stairways and passages therefrom,
and parking areas at all times, 365 days a year, on a 24 hour basis, subject to the rules
and regulations provided in this Lease, and subject to emergencies.
	 
	16.33	 	Leasehold Improvement Allowance

	 	(a)	 	It is understood and agreed that Landlord shall pay to the Tenant a
leasehold improvement allowance being the sum of thirty-five dollars ($35.00) per
sq.ft. multiplied by the Rentable Area of the Premises, together with the Sales
Taxes thereon, (the “Leasehold Improvement Allowance”). The Tenant shall use the
Leasehold Improvement Allowance to pay the cost of the Tenant’s Work in the Premises
for its use and operation.
	 
	 	(b)	 	Notwithstanding the provisions of the foregoing, Landlord shall, on no
more than three (3) occasions, allow the Tenant to draw portions of the Leasehold
Improvement Allowance, which shall be payable within thirty (30) days following the
date of the Tenant’s written request for such draw, subject to construction lien
holdback, which shall be no more than 10% in the aggregate of the said Leasehold
Improvement Allowance.
	 
	 	(c)	 	Payment of each progress draw shall be subject to the following:

	 	(i)	 	delivery of invoices for costs incurred to date of such advance;
	 
	 	(ii)	 	the Tenant satisfying Landlord that the value of the construction
materials and labour is commensurate with the amounts invoiced;
	 
	 	(iii)	 	statement of the Tenant’s contractor certifying that the level of work
has been completed in respect to the current progress draw for the
same has been made to the Landlord; and
	 
	 	(iv)	 	a draw request from the Tenant to the Landlord, including therewith
the Tenant’s G.S.T registration number.

 

38

	 	(d)	 	In addition to the foregoing provisions the final advance of the
Leasehold Improvement Allowance for the Premises shall be payable upon the
following conditions:

	 	(i)	 	the delivery to the Landlord of proof of payment of
worker’s compensation assessment for all the Tenant’s contractors and
subcontractors
	 
	 	(ii)	 	the completion of the Tenant’s Leasehold Improvements and
trade fixtures, and
	 
	 	(iii)	 	the delivery to the Landlord of a statutory declaration
stating that there are no construction liens registered or outstanding
affecting the Premises in respect to the Tenant’s Leasehold Improvements, or
trade fixtures, and that all accounts for work, services or materials have been
paid in full with respect to the Tenant’s Leasehold Improvements and trade
fixtures.

	 	(e)	 	If the Landlord fails to pay any installment(s) of the Leasehold
Improvement Allowance to the Tenant when otherwise due to the Tenant,
then the Tenant may set-off any such unpaid installment(s) together with
interest thereon at a rate of six (6) percent per annum from the Basic Rent
and Additional Rent next coming due until set-off in full.

	16.34	 	Tenant’s Work
	 
	 	 	The Tenant shall be responsible for all work to prepare the Premises for its occupancy
not provided under Landlord’s Work including, but not limited to, the installation and
cost of all its internal partitions, fixtures, electrical wiring, telecommunication
cabling and plumbing costs, together with the cost of any modifications to the ceiling,
light or heating ventilation and air-conditioning systems in the Premises, as required by
the Tenant’s occupancy, excluding any Landlord’s Work provided for herein (the “Tenant’s
Work”).
	 
	 	 	The Tenant shall also be responsible for the cost of installing any special equipment
required by its occupancy. The Tenant’s Work shall be completed in a good and workmanlike
manner, subject to the prior written approval of the Tenant’s plans by Landlord, acting
reasonably, as detailed and provided for in paragraph 16.35 contained herein and shall be
completed in accordance with the Tenant Leasehold Improvement Manual attached as Schedule
“H” to this Lease governing the Building’s rules and regulations for the coordination and
construction of the Tenant’s Work.
	 
	 	 	Tenant shall bear (i) the out-of-pocket costs of all the Landlord’s plan reviews and
approvals in respect of the mechanical and electrical components of the Tenant’s Work in
an amount not to exceed $9,000.00 (plus Sales Taxes), and (ii) the reasonable
out-of-pocket costs incurred by the Landlord in retaining its base building or designated
engineers) or consultant(s) to review and approve the plans for any other component(s) of
the Tenant’s Work (save for the mechanical and electrical components as aforesaid),
unless the Tenant engages the services of any such base building or designated
engineer(s) or consultant(s) with respect to any such component(s) of the Tenant’s Work
in which event the Tenant shall not be responsible for any costs incurred by Landlord in
respect thereof. The Tenant shall not be responsible for any charges for electrical use
or other security, management, supervision, or elevator use, or other special Landlord
costs, during the construction of the Tenant’s Work or Landlord’s Work, prior to the
Commencement Date. Landlord shall co-ordinate with the Tenant the use of one (1) service
elevator for the Tenant’s use during its Fixturing Period.

 

39

	16.35	 	Working Drawings
	 
	 	 	The Tenant shall submit to the Landlord working drawings of its proposed improvements to the
Premises, such drawings must be approved by the Landlord prior to the commencement of any
such work, provided that such work shall be done by qualified and licensed contractors or
sub-contractors of whom the Landlord shall have approved in writing, such approvals not to
be unreasonably withheld or delayed. It shall be deemed that Landlord has given consent to
the Tenant’s drawings and licensed contractors or subcontractors, if consent or other
written notice is not provided to the Tenant within ten (10) Business Days from the
Landlord’s receipt of the Tenant’s drawings or list of contractors.
	 
	 	 	The Landlord shall provide the Tenant with a copy of any and all design, mechanical
and electrical drawings, for existing improvements in the Premises, that are within
the Landlord’s possession and control upon acceptance of the Offer between the
parties.
	 
	16.36	 	Permit and Approvals
	 
	 	 	It is the Tenant’s responsibility to secure all the necessary building permits and approvals
required by the City of Toronto for all its Tenant’s Work. Such permits must be secured and
copies provided to the Landlord before any work shall commence in the Premises. The Landlord
shall promptly provide any consent or approvals required of it in this regard.
	 
	16.37	 	Condition of Premises
	 
	 	 	Except for the Landlord’s Work, as described herein, the Tenant shall accept the Premises on
an “as is” basis, and with the understanding that any Leasehold Improvements currently in
place shall remain for the use of the Tenant, for the duration of the Term.
	 
	16.38	 	Landlord’s Work
	 
	 	 	The Landlord shall be responsible for the cost and installation of the work outlined on the
schedule attached hereto as Schedule “G” (the “Landlord’s Work”). The Landlord covenants and
agrees to use its reasonable commercial efforts to complete its Landlord’s Work prior to the
Access Date (as defined in Section 16.39 herein), subject to force majeure outlined in
paragraph 16.19 herein.
	 
	 	 	Notwithstanding anything contained herein, the Tenant may request the Landlord to complete
the Landlord’s Work to any one or more of the following floors (on a full floor basis only),
being the 4th, 5th, 6th, and/or 7th floors in the Building, upon two (2) months written
notice provided by the Tenant to the Landlord.
	 
	16.39	 	Fixturing Period
	 
	 	 	The Landlord shall complete the Landlord’s Work to such an extent that will permit the
Tenant to commence and complete the Tenant’s Work without interference by the Landlord’s
workmen or work on the 2nd, 4th, 5th, 6th, 7th, 8th, 9th, 10th and 11th floors on or before
December 31, 2006 and on the 3rd floor on or before June 1, 2007 (the “Access Dates”), to
permit the Tenant to carry out the construction of its Tenant’s Work, and for the
installation of the Tenant’s trade fixtures and equipment which the Tenant shall be entitled
to undertake during the period commencing from and after the Access Dates to and including
the day immediately preceding the Commencement Date on a Rent free basis except as otherwise
provided for in the last paragraph of Section 3.3 of this Lease.

 

40

	16.40	 	Other Charges
	 
	 	 	The Tenant shall be responsible for its telecommunication charges and any other special
services provided to the Premises, at its request
	 
	16.41	 	Additional Premises

	 	(a)	 	The Landlord hereby represents and warrants to the Tenant that its
existing lease (the “Current Lease”) with the existing tenant of the 12th floor of
the Building (the “CT”) expires on October 31, 2007 and contains options to extend
the term of the Current Lease for two (2) further separate and consecutive periods
of five (5) years each upon written notice delivered to the Landlord on or before
April 30, 2007 in the case of the first extension and April 30, 2012 in the case of
the second extension.
	 
	 	(b)	 	Subject to subclause (d) below, at some time between October 1, 2011 and
March 1, 2013 (the “A. P. Commencement Date”), the Landlord shall lease to the
Tenant and the Tenant shall lease from the Landlord additional office space in the
Building (the “Additional Premises”). The Additional Premises shall consist of the
entire 12th floor of the Building in the event the CT fails to exercise its first
option to extend the term of the Current Lease or the 12th floor of the Building is
as of October 1, 2009, vacant and available for lease but otherwise shall consist
of one full floor of the 14th, 15th, 16th, 17th and 18th floors of the Building.
The Landlord acknowledges and agrees that it is the Tenant’s preference that the
Additional Premises comprise the entire 12th floor of the Building and the Landlord
shall use reasonable commercial efforts to accommodate such preference.
	 
	 	(c)	 	Subject to subclause (d) below, the lease of the Additional Premises
shall commence on the A. P. Commencement Date and shall be coterminous with the
Term (including for greater certainty any extension(s) or renewal(s) thereof, if
exercised) and shall otherwise be under the same terms and conditions as this
Lease, which shall apply mutatis mutandis, subject to the following provisions:

	 	(i)	 	The Landlord shall on or before October 1, 2009 provide written
notice to the Tenant of the exact location of the Additional Premises and the
A. P. Commencement Date. The Landlord will complete the Landlord’s Work to the
Additional Premises and deliver vacant possession of same to the Tenant no
later than three (3) months prior to the A. P. Commencement Date and the Tenant
shall thereafter to and including the day immediately proceeding the A. P.
Commencement Date be permitted on a gross rent free basis to complete its
Tenant’s Work to the Additional Premises.
	 
	 	(ii)	 	As provided for in this Lease the Landlord shall provide to the
Tenant a leasehold improvement allowance for the Additional Premises. The value
of the leasehold improvement allowance shall be prorated over the remaining
Term after the A. P. Commencement Date and shall be equal to $0.291667
multiplied by the remaining months of the Term after the A. P. Commencement
Date multiplied by the Rentable Area of the Additional Premises.

	 	(d)	 	Notwithstanding anything contained in this Section 16.41 of this Lease,
in the event that the Tenant has on or before October 1, 2009 leased or
committed to lease pursuant to Section 16.25 of this Lease or otherwise,
additional premises in the Building (other than the Premises) consisting of
at least 17,698 square feet of Rentable Area, then the provisions of this
Section 16.41 of this Lease thereafter shall be null and void and of no

 

41

	 	 	 	further force and effect.

	16.42	 	Additional Rent
	 
	 	 	The Additional Rent for the calendar year 2005 is estimated to be $17.10 per rentable
sq.ft. and composed of the following estimates:

	 	 	 
	Taxes:

	 	$ 8.38 per rentable sq.ft. per annum*
	Operating Costs:

	 	$7.72 per rentable sq.ft. per annum**
	Tenant Utilities:

	 	$1.00 per rentable sq.ft. per annum*
	Total:

	 	$17.10 per rentable sq.ft. per annum

 

			
	*	 	No management or administration fee shall be eligible
	 
	**	 	This estimate includes a management and administration fee which
is not to exceed 15% of Operating Costs

	 	 	The Tenant and the Landlord acknowledge that the above amount for Additional Rent is an
estimate only and is subject to adjustment based on actual costs. It is further
acknowledged that the estimate is based on current Business Hours and will increase as a
result of the increased Building Operating Hours outlined in Section 6.2 herein.
	 
	16.43	 	Interesse Termini
	 
	 	 	The Landlord and Tenant acknowledge and agree that for all purposes of this Lease
including, without limitation, for the purpose of the Tenant enforcing its right to
exclusive possession of the Premises, the parties specifically waive the applicability of
the common law doctrine of interesse termini (the “Doctrine”) and agree that the Doctrine
shall not be applicable to this Lease or the rights of the Tenant under this Lease and
the Tenant shall be entitled to enforce its rights and remedies contained in this Lease
and at law (including, without limitation, obtaining an order for specific performance)
as if the Doctrine had been abolished in the Province of Ontario.
	 
	16.44	 	Suite 208 — INTENTIONALLY DELETED
	 
	16.45	 	Landlord’s Covenant, Warranty and Representation
	 
	 	 	The Landlord covenants, warrants and represents to the Tenant as follows:

	 	(i)	 	that it is the registered owner of the Development, it has the
right to enter into and perform its obligations under this Lease and that it
has obtained all approvals and consents required in order for it to do so; and
	 
	 	(ii)	 	save and except for routine day-to-day maintenance items, there
are no significant anticipated or scheduled maintenance, repairs or replacements
to the Development or any of its components.

 

42

	16.46	 	INTENTIONALLY DELETED
	 
	16.47	 	Reasonableness
	 
	 	 	Unless otherwise stated in this Lease to the contrary, whenever any consent, approval,
judgement, discretion or other similar decision is required of the Landlord, its
architect, engineers, auditors or similar person, such consent, approval, judgement,
discretion or other similar decision shall not be withheld or exercised unreasonably and
all the parties shall be bound to act reasonably, in good faith and without undue delay.
	 
	16.48	 	Successors and Assigns
	 
	 	 	Except as otherwise specifically provided, the covenants, terms and conditions contained
in this Lease shall apply to and bind the parties hereto and their respective successors
and assigns.

IN WITNESS WHEREOF the parties hereto have duly executed this Lease as of the day, month and year
first above written.

	 	 	 	 	 	 	 
	 	 	592423 ONTARIO INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	[Authorized Signing Officer]	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	[Authorized Signing Officer]	 	 
	 
	 	 	 	 	 	 
	 	 	We have authority to bind the Corporation.	 	 
	 
	 	 	 	 	 	 
	 	 	LOYALTY MANAGEMENiT GROUP CANADA INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	[Authorized Signing Officer]	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	[Authorized Signing Officer]	 	 
	 
	 	 	 	 	 	 
	 	 	We have authority to bind the Corporation.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00117-of-00352.parquet"}]]