December 19, 2011 Geoffrey Beal Masterfile Corporation 3 Concorde Gate, 4th Floor Toronto, Ontario, Canada M3C

3N7 Dear Mr. Beal : Re: Notice of Copyright Infringement - www. com

Thank you very much for notifying us of this apparent infringement on your alleged copyright. Please note that we use the term alleged not to be disrespectful of your claim, but to point out that simply because Masterfile has the image in question for sale on its website in no way proves that, as you state, Masterfile represents the image exclusively, that the image is in fact correctly registered with the United States Library of Congress, or that the original artist has consented to, and continues to consent to Masterfiles representation. We dutifully respect and support the rights of the artist in such cases and understand that knowing copyright infringement is not to be taken lightly. However, we would be foolish to simply send you monetary compensation toward this claim without having complete access to all of the facts involved. We assure you that any unauthorized use of said image on our website was an oversight on the part of the design company we hired to develop our website. The image was used for composition purposes only and under soft release - the website has not yet been officially launched nor advertised and was only viewed by a handful of people associated with our business. As a result of receiving your letter, we have taken steps to insure that all other images used on our website are our own images or licenced for our use. In response to your claim, we immediately removed the image in question from our site. Please note that our immediate removal of the image in question is in no way an admission of knowing infringement on our part. We have removed the image in good faith and in respect of the original artists rights. We feel that this immediate removal of the image in question completely fulfills part (a) of your demand to cease and desist from any and all unauthorized uses of the image. As for part (b) of your demand, to pay the retroactive license fee noted in the enclosed claim invoice, we take issue with the amount you calculated for this retroactive license fee. We are open to some form of settlement as again, we are acting in good faith, and we understand that our unknowing infringement of your alleged copyright does not absolve us of negligence in the

event that you can supply all supporting documentation to back up your claim. It appears that the image in question is a rights managed image and Masterfile charges for the use of this image on a scale based upon time used. Unfortunately, this again places the burden of proof on Masterfile in this claim to define the length of time that this image allegedly appeared on our website. We see in the screenshot that you provide that it appeared on our website on November 21, 2011. We also saw for ourselves upon receipt of your claim that the image appeared on our site on December 14, 2011. Again, in good faith we are willing to assume that the image remained on our site from November 21, 2011 until it was removed on December 15, 2011, or a total of 25 days. We see on the Masterfile site that if we were to pay for the use of this image, the smallest block of time offered in your pay plan would be up to 1 month. Also, to further use your pricing calculator, we would select usage type - Internet, type of internet use - Website promotional, position - secondary page, Territory type - city, Territory - Washington, DC, and would arrive at a quoted price of $390 US for the use of the image for up to one month. $390 US is what we would pay if we were in the market to use a rights managed image from Masterfile. We were not. If this were the case, we would have spent more for the use of a single image for one month than we would for the complete development and hosting of our entire website for a year! In actuality we would, and have, paid for web resolution, royalty free images for which Masterfile charges $49 US. The retroactive license fee noted in the enclosed claim invoice is for $2,310.00 US. Again, I do not mean to be disrespectful of your claim; however, you are going to need to supply a lot more indisputable fact in order for us to agree to the terms of this claim. We understand that under law Masterfile must bear the burden of defending its copyrights and spends a certain amount of time and money to search for and prosecute unauthorized use of its copyrighted images. With this in mind, we are willing to offer in good faith a settlement to Masterfile without demanding further proof of the terms in this claim. If we assume that the image in question appeared on our website for 25 days, and if we assume that Masterfiles exclusive copyright status is in good standing, and that the original artist is still contracting Masterfile to manage the rights for the image, we are willing to offer Masterfile, in good faith, a settlement of $100.00 US for this claim. Masterfile will have ten (10) days to supply an updated claim invoice in the amount of $100.00 US for the retroactive license fee associated with the use of image 700-00918454 for the time period of November 21, 2011 to December 15, 2011. Receipt of said invoice, and subsequent will conclude this matter. payment by If Masterfile does not wish to comply to these terms and offer of good faith settlement, please note that will consider this matter closed and any good faith

assumptions held in this letter will be retracted. Masterfile will be held to a much higher burden of proof if it wishes to pursue the terms of its original claim. Please understand that this offer of settlement is not an admission of any wrong doing on the part of This is not an agreement to the terms of your claim. We are simply acting in good faith in the interest of the rights of the artist involved. Please also understand that nothing in this reply should be construed as a waiver of any of the rights of remedies, or protections under law. Again, thank you very much for your notification of this alleged infringement, for your time, and for your understanding in this matter. Regards,