ASSET PURCHASE AGREEMENT AMONG HELIX HEARING INC. AND HELIX HEARING CARE OF AMERICA CORP. AND ###-###-#### CANADA INC. April 27, 2009

servitudes, easements, restrictions, rights-of-way and other similar rights in real property or any interest therein (hereinafter, collectively, the “Easements”) which do not materially impair its use in the operation of the Business including, without limitation, any Easements granted in respect of any sewers, electric lines, telegraphs and telephone lines and other utilities and services, provided that, in each case, the Easements have been complied with in all respects;

any statutory liens and other interests of the landlords in any Leased Property and liens affecting the interests of the landlords in any Leased Property, and as to other leased Purchased Assets any interests of the lessor thereof;

liens for Taxes not due and payable;

undetermined or inchoate liens, charges and privileges incidental to current construction or current operations and statutory liens, charges, adverse claims, security interests or encumbrances of any nature whatsoever claimed or held by any Authority which have not at the time been filed or registered against the title to the asset or served upon the Vendor, pursuant to law or which relate to obligations not due or delinquent;

security given in the ordinary course of the Business to any public utility, municipality or government or to any statutory or public authority in connection with the operations of the Business, other than security for borrowed money;

the reservations in any original grants from the Crown of any real property or interest therein and statutory exceptions to title which do not materially detract from the value of the real property concerned or materially impair its use in the operation of the Business; and,

registered subdivision, site plan, development or other municipal agreements which affect the Leased Property, provided that such are complied with.

Equipment. All equipment owned or leased by the Vendor that is used or held for use in the conduct of the Business, including audiology and medical equipment, computer hardware, telephones, telephonic equipment and switches, electronic equipment of any description, cell phones, automobiles, and postage meters (the “Equipment”) including the Equipment described in Schedule 2.1(a);

Contracts. Subject to Section 7.8, Vendor Contracts, including those set out in Schedule 2.1(b) including, for greater certainty, all outstanding solicitations and offers made to or by the Vendor to enter into any Vendor Contract;

Leases. Subject to Section 7.10, all Leases, including, for greater certainty, if permitted in accordance with the terms and conditions of the Leases, all prepaid rents, security deposits, options to renew or purchase and rights of refusal contained in the Leases or made pursuant thereto;

Restrictive Covenants. Without limiting the effect of Section 2.1(b) above, and to the extent transferable, the benefit of any restrictive covenants and other contractual rights, including rights of indemnification and any rights of exclusive use in respect of the Leased Property as more particularly set out in the Leases, if applicable, obtained by the Vendor in the course of acquiring assets related to the Business and the Purchased Assets from third parties;

Leaseholds. All leasehold improvements to the Leased Property which were the property of the Vendor as at the Time of Closing;

Cash. All Cash of the Vendor as at the Effective Time in the Accounts Receivable Trust Bank Account;

Furniture, Fixtures and Office Equipment. All of the Vendor’s right, title and interest to the furniture, fixtures and office equipment used in the Business, including the furniture, fixtures and office equipment described in Schedule 2.1(g);

Books and Records. All Books and Records;

Licences and Permits. To the extent transferable, all rights under licences, permits (including parking permits), approvals, consents, registrations, certificates and other regulatory authorizations and enrolments currently held or necessary, including under Applicable Law, for the lawful operation of the Business as now conducted and the use or ownership of the Purchased Assets, and any pending applications for or renewals of any of the foregoing (collectively, the “Permits”), including those described in Schedule 2.1(i);

Accounts Receivable. All Accounts Receivable of the Vendor;

Intellectual Property. All of the Vendor’s right, title and interest to all Intellectual Property owned or licensed (as licensor or licensee) by the Vendor relating to the Business and the Purchased Assets including:

the Vendor’s name, all assumed fictional business names, trade names, registered and unregistered trademarks, service marks and applications for marks;

all patents, patent applications and inventions and discoveries that may be patentable;

all registered and unregistered copyrights and industrial designs in both published works and unpublished works;

all know-how, trade secrets, confidential or proprietary information, software, technical information, data, manufacturing, industrial and business processes and technology, plans, drawings and blue prints;

all rights in internet websites and internet domain names owned by or registered in the name of the Vendor, whether or not presently used, and all email addresses presently used by personnel of the Vendor for purposes of the Business including email addresses provided by third party service providers; and

the HearUSA Licence;

Inventory. The inventory owned by the Vendor of or relating to the Business (collectively, the “Inventory”) at the Effective Time, including finished goods, supplies and replacement parts;

Prepaid Expenses. Without limiting any of the foregoing, the benefit of prepaid expenses relating to the Purchased Assets whether or not reflected on the Balance Sheet (collectively, the “Prepaid Expenses”);

Telephone Numbers. All telephone and facsimile numbers and other communications numbers, address and points of contact of the Business;

Customer, Patient and Supplier Files. All customer, patient and supplier lists, records, files, and contact details and telephone numbers of the Business whether in hard copy or electronic readable format;

Goodwill. All goodwill relating to the Business, together with the exclusive right for the Purchaser to represent itself as carrying on the Business in succession to the Vendor and the right to use any words indicating that the Business is so carried on;

Warranty Rights. All warranty rights accruing to the Vendor;

Purchased Shares. All of the issued and outstanding shares in the capital of ###-###-#### (the “Purchased Shares”).

Taxes. All refundable or creditable Taxes of the Vendor, including income taxes, sales taxes, and GST (or the right to receive such refunds or credits);

Investments. All investments of the Vendor in marketable or other securities;

Inter-Company Debt. All indebtedness of any Affiliate of the Vendor (other than ###-###-####) to the Vendor;

Insurance. All property and public liability insurance policies of the Vendor and all claims and rights thereunder;

Corporate Records. All minute books, share certificate books, corporate seals and other corporate records of the Vendor;

Personnel Records. All personnel records and other records that the Vendor is required by Applicable Law to retain, provided that the Purchaser shall be provided with copies thereof;

Employee Plans. Subject to Section 7.7(j), all rights in connection with the assets of the Employee Plans; and

Other. Accrued deferred compensation payable, retirement accounts and other similar items accruing to the Vendor, that are not included as a Current Asset in the Closing Balance Sheet.

part of the Purchase Price shall be paid by the Purchaser as directed by Vendor to the creditors of the Vendor disclosed pursuant to compliance with Section 4(1) of the Bulk Sales Act (Ontario) and to such other Persons to whom payments are required to be made at Closing;

the amount of $1,000,000 of the Purchase Price (the “Escrow Amount”) shall be paid by the Purchaser to the Escrow Agent to be held in accordance with the terms of the Escrow Agreement; and

the balance of the Purchase Price shall be paid by the Purchaser to the Vendor or as it may direct.

the liabilities and obligations of the Vendor that arise from and after the Effective Time under Vendor Contracts (including purchase and sales orders) which were entered into by the Vendor in the ordinary course of conducting the Business prior to the Closing Date other than any liabilities or obligations arising out of or relating to a breach that occurred prior to the Effective Time. For greater certainty, the Purchaser shall not assume or be liable for any liabilities and obligations of the Vendor that have accrued, even if not due, or become outstanding or otherwise relate to events that have occurred prior to the Closing Date;

any liabilities or obligations of the Vendor under written warranty agreements given to customers in the ordinary course of business prior to the Closing Date other than any liabilities or obligations arising out of or relating to a breach of such warranty agreement that occurred prior to the Effective Time; and

accrued and unused or unpaid vacation rights of the Employees in connection with the Business as reflected on the Closing Balance Sheet.

For the purposes of determining the amount of applicable Excluded Liabilities, any rents, reality taxes including local improvement rates, unmetered public or private utility charges and unmetered cost of fuel, as applicable, and other applicable items shall be apportioned on the basis that the Vendor will be responsible for a portion of the total of such amounts for the calendar year in which the Closing Date occurs in the ratio that the number of days in such calendar year up to and including the Closing Date bears to 365. If any such amount has not been finally determined as of the Closing Date, then the amount estimated and charged by the applicable payee, or in the absence of such estimate the amount paid for the preceding calendar year, shall be used to calculate such prorations. The aggregate pro rated amount shall be an adjustment to the amount of cash due from the Purchaser to the Vendor at the Closing. The parties shall readjust any such amounts within ten (10) business days following a request by either party based on the actual amount of such item.

For the purposes of making a preliminary determination of the Net Current Asset Adjustment Amount, on the day prior to the Closing Date, the Vendor shall provide a pro forma balance sheet reflecting (i) Current Assets as reflected in the Accounting Records on the day prior to the Closing Date, and (ii) a reasonable accrual for Assumed Liabilities. Based on the foregoing pro forma balance sheet, the parties acting reasonably will determine an estimated Net Current Asset Adjustment Amount which, only if positive, shall be an adjustment to the amount of cash due from the Purchaser to the Vendor at the Closing.

Following the Closing Date, the parties shall make an adjustment (the “Returns Reserve Adjustment”) reflecting the impact on the Returns Reserve of any product sale of Vendor that is (i) returned after the Closing Date and within 45 days of the relevant sale and (ii) returned to the manufacturer by the Purchaser prior to the expiry of the manufacturer’s return warranty period. To the extent that any portion of the Returns Reserve remains unutilised after the expiry of 180 days following the Closing Date, then such surplus shall be a Returns Reserve Adjustment and the Purchaser shall pay such amount to the Vendor as an adjustment to the Purchase Price. To the extent that product returns as set out above result in the Returns Reserve being insufficient to satisfy all such returns, then any such deficiency shall be a Returns Reserve Adjustment and shall be paid by the Vendor to the Purchaser as an adjustment to the Purchase Price. The parties shall readjust any such amounts within ten (10) business days following a request by either party based on the actual amount of such item.

For the purposes hereof:

“Net Current Asset Amount” means the amount, as of the relevant time, calculated by subtracting the amount of accrued Assumed Liabilities as of that date and the Returns Reserve from the value of the Current Assets as of that date, all as set out in the Closing Balance Sheet.

“Net Current Asset Adjustment Amount” (which may be a positive or negative number) will be equal to the amount determined by subtracting the Net Current Asset Amount from the amount of $3,000,000.00.

The Vendor shall prepare the Closing Balance Sheet and shall then determine the Net Current Asset Amount as of the Effective Time. The Vendor shall deliver the Closing Balance Sheet and its determination of the Net Current Asset Amount to the Purchaser after forty-five (45) days but within sixty (60) days following the Closing Date.

If within thirty (30) days following delivery of the Closing Balance Sheet and the Net Current Asset Amount calculation, the Purchaser has not given the Vendor written notice of its objection as to the Net Current Asset Amount calculation (which notice shall state the basis of the Purchaser’s objection), then the Net Current Asset Amount calculation by the Vendor shall be binding and conclusive on the parties and shall be used in computing the Net Current Asset Adjustment Amount.

If the Purchaser duly gives the Vendor such notice of objection, and if the Purchaser and the Vendor fail to resolve the issues outstanding with respect to the Net Current Asset Amount calculation within thirty (30) days of the Vendor’s receipt of the Purchaser’s objection notice the Vendor and the Purchaser shall submit the issues remaining in dispute to PriceWaterhouse Coopers, Toronto (the “Independent Accountants”) for resolution. If issues are submitted to the Independent Accountants for resolution, (i) the Vendor and the Purchaser shall furnish or cause to be furnished to the Independent Accountants such working papers and other documents and information relating to the disputed issues as the Independent Accountants may request and are available to that party or its agents and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and to discuss the issues with the Independent Accountants; (ii) the determination by the Independent Accountants, as set forth in a notice to be delivered to both the Vendor and the Purchaser within sixty (60) days of the submission to the Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the parties and shall be used in the calculation of the Net Current Asset Amount; and (iii) the unsuccessful party in respect of the aggregate of the issues in dispute shall bear the fees and costs of the Independent Accountants for such determination.

If the Net Current Asset Adjustment Amount is positive, the Net Current Asset Adjustment Amount shall be paid by wire transfer by the Vendor to an account specified by the Purchaser. If the Net Current Asset Adjustment Amount is negative, the Net Current Asset Adjustment Amount shall be paid by wire transfer by the Purchaser to an account specified by the Vendor. Such payment shall be made within three (3) business days after the calculation of the Net Current Asset Amount becomes binding and conclusive on the parties pursuant to this Section 3.6. For greater certainty, any amounts paid under this paragraph (e) by the Purchaser or the Vendor, as applicable, shall be considered an adjustment to the Purchase Price.

The Purchaser and the Vendor agree to make and file, in a timely manner, a joint election to have the rules in section 22 of the ITA, and any equivalent or corresponding provision under applicable provincial or territorial tax legislation, apply in respect of the Accounts Receivable that are the subject of that election and shall designate therein that portion of the Purchase Price allocated to the Accounts Receivable that are the subject of such election in accordance with the procedures set out in Section 3.7 of this Agreement as consideration paid by the Purchaser to the Vendor.

The Purchaser shall jointly elect with the Vendor in accordance with proposed subsection 56.4(7) of the ITA to have the provisions of proposed subsection 56.4(5) of the ITA apply to the restrictive covenants granted by the Vendor in the Non-Competition Agreement. The Purchaser shall jointly elect with HearUSA, and the Vendor shall cause HearUSA to so elect, in accordance with proposed subsection 56.4(7) of the ITA to have the provisions of proposed subsection 56.4(5) of the ITA apply to the restrictive covenants granted by HearUSA in the Non-Competition Agreement. Each of the foregoing elections shall be filed in the manner and within the time prescribed in proposed subsection 56.4(14) of the ITA.

Each Company is a company validly existing under the laws of Canada and has the corporate power to own or lease its property and to carry on the Business as now being conducted by it and to execute and deliver and perform its obligations under this Agreement.

HearUSA is a company validly existing under the laws of Delaware and has the corporate power to execute and deliver and perform its obligations under this Agreement.

All necessary corporate action has been taken by each of the Companies and HearUSA to authorize the execution and delivery by it of, and the performance of its obligations under, this Agreement.

This Agreement has been duly executed and delivered by each Company and HearUSA and constitutes a legal, valid and binding obligation of each of them, enforceable against each of them by the Purchaser in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency and other laws affecting the rights of creditors generally and except that equitable remedies may only be granted in the discretion of a court of competent jurisdiction.

The authorized, issued and outstanding capital of ###-###-#### is as described on Schedule 4.3(a). The Vendor is, and at the Time of Closing will be, the registered and beneficial holder of the Purchased Shares with good and marketable title thereto, free and clear of all Encumbrances. There are no rights, subscriptions, warrants, options, conversion rights, calls, commitments or plans or agreements of any kind outstanding that would enable any person to purchase or otherwise acquire any shares or other securities of ###-###-####, including any securities convertible into or exchangeable or exercisable for shares or other securities of ###-###-####.

The only assets of ###-###-#### are Cash and Accounts Receivable of ###-###-#### and those ###-###-#### Contracts expressly described in Schedule 4.3(b). The only liabilities of ###-###-#### are accounts payable in an amount not in excess of the Cash and Accounts Receivable of ###-###-####, and liabilities and obligations of ###-###-#### that will arise from and after the Effective Time under ###-###-#### Contracts which were entered into by ###-###-#### in the ordinary course of conducting the Business prior to the Closing Date.

Tax Returns of ###-###-####. 3371727 has duly and timely filed all Tax Returns required to be filed by it with the appropriate Tax Authority. Each such Tax Return is correct and complete. 3371727 is not required to make any filing in respect of Taxes in any jurisdiction outside Canada.

Payment of Taxes. 3371727 has duly and timely paid all Taxes, including all instalments on account of Taxes and all Taxes assessed or reassessed by any Tax Authority, that are due and payable by it. Adequate provision has been made in the Existing Balance Sheets for all Taxes owing by ###-###-#### that relate to periods ending on or prior to March 28, 2009, whether or not reflected in the Tax Returns of ###-###-####. Adequate provision will also be made in the Closing Balance Sheet for all Taxes owing by ###-###-#### that relate to periods ending on or prior to the Closing Date. The provisions for Taxes reflected in the Existing Balance Sheets and Closing Balance Sheet are, or will be, as applicable, sufficient to cover all liabilities for Taxes of ###-###-####, whether or not assessed, reassessed or disputed, or that will accrue and be owing in respect of its operations and property during the periods covered by such Existing Balance Sheets and Closing Balance Sheet. For greater certainty, except to the extent reflected in the provisions for Taxes in the Existing Balance Sheets and Closing Balance Sheet, 3371727 is not liable, or will not be liable, as applicable, for any Taxes or for the payment of any instalments in respect of Taxes due in respect of its current taxation year.

Assessments and Reassessments. Except as disclosed in Schedule 4.5, all Tax Returns required to be filed by ###-###-#### for periods ending on or prior to the Closing Date have been assessed by the relevant Tax Authority as filed and notices of assessment have been issued to ###-###-#### by the relevant Tax Authority. No notice of reassessment for Taxes has been issued to ###-###-#### by a Tax Authority for periods ending on or prior to the Closing Date except as disclosed in Schedule 4.5. 3371727 is not in the process of negotiating any proposed assessment or reassessment with any Tax Authority. 3371727 has not received any indication from any Tax Authority that an assessment or reassessment is proposed in respect of any Taxes or Tax Returns, regardless of its merits. To the knowledge of the Vendor, there are no inquires, audits, investigations, disputes, objections, appeals or other proceedings either in progress, pending or threatened against ###-###-#### in connection with any Taxes or Tax Return.

Extensions of Time. 3371727 has not requested, offered to enter into, or entered into, any agreement or other arrangement, or executed any waiver, providing for any extension of time within which (i) to file any Tax Return covering any Taxes for which ###-###-#### is or may be liable; (ii) to file any elections, designations or similar filings relating to Taxes for which ###-###-#### is or may be liable; (iii)  ###-###-#### is required to pay or remit Taxes or amounts on account of Taxes; or (iv) any Tax Authority may assess or collect Taxes for which ###-###-#### is or may be liable.

Withholdings. 3371727 has duly and timely withheld all Taxes and other amounts required by Applicable Law to be withheld by it, including Taxes and other amounts required to be withheld by it in respect of any amount paid or credited or deemed to be paid or credited by it to or for the account or benefit of any Person, including any employees, officers or directors and any non-resident Person, and has duly and timely remitted to the appropriate Tax Authority such Taxes and other amounts required by Applicable Law to be remitted by it.

Collection and Remittance of GST, Harmonized Sales Tax and Provincial Sales Tax. 3371727 has duly and timely self-assessed and collected all amounts on account of any sales or transfer taxes, including goods and services, harmonized sales and provincial sales taxes, required by Applicable Law to be self-assessed or collected by it, and has duly and timely remitted to the appropriate Tax Authority any such amounts required by Applicable Law to be remitted by it.

The execution and delivery of this Agreement by each Company and HearUSA and, subject to Section 4.8, the consummation of the transactions herein provided for will not result in a breach or violation of any of the provisions of, or constitute a material default under, or conflict with or cause the acceleration of any obligation of such Company under: (i) any Contract listed on Schedules 2.1(b) and 4.3(b); (ii) any provision of the constating documents or by-laws or resolutions of the board of directors (or any committee thereof) or shareholders of such Company; (iii) any Permit referred to on Schedule 2.1(g); or (iv) any Applicable Law.

The execution and delivery of this Agreement by each Company and the consummation of the transactions herein provided for will not result in the creation or imposition of any Encumbrance on any of the Purchased Assets.

Except as described in Schedule 4.8(a), there is no requirement for any Company to make any filing with, give any notice to or obtain any Permit from any Authority as a condition to the lawful consummation of the transactions contemplated by this Agreement, other than those which relate solely to the identity of the Purchaser or the nature of any business carried on by the Purchaser.

There is no requirement under any Contract listed in Schedules 2.1(b) and 4.3(b) or under any Lease listed in Section 2.1(c) to give any notice to, or to obtain the consent or approval of, any party to such agreement, instrument or commitment relating to the consummation of the transactions contemplated by this Agreement, except for the notifications, consents and approvals described in Schedule 4.8(b).

Neither Company is a party to any lease or agreement to lease in respect of any real property, whether as a lessor or lessee, in connection with the Business, other than the Leases. The Leases are in good standing and in full force and effect and there are no existing defaults in respect of any covenants, conditions or obligations contained in the Leases, except where such breach would not, individually or in the aggregate with any other such breaches, have a Material Adverse Effect.

Use of the Leased Property for the various purposes for which it is presently being used is permitted as of right under the Leases, and to the knowledge of the Vendor all applicable zoning legal requirements. To the knowledge of the Vendor, all Leased Property, including any improvements thereto are in compliance with all applicable legal requirements, including those pertaining to zoning, building and the disabled, are in good repair and in good condition, ordinary wear and tear accepted, and are free from latent and patent defects.

To the knowledge of the Vendor, the Leased Property has not been taken or expropriated by any Authority, nor has any written notice in respect thereof been received by the Vendor.

To the knowledge of the Vendor, the Leased Property has adequate rights of ingress and egress for the operation of the Business in the ordinary course by a reasonable and prudent owner and operator of the Business.

The Vendor has not received any written notice, and to the knowledge of the Vendor, is not aware, of any special assessments or levies (including local improvement charges) on account of on or off site municipal services constructed to service the Leased Property. All amounts due and owing by the Vendor to any Authority in respect of the Leased Property have been paid.

The Vendor has not received from any Authority having jurisdiction any written notice or other information which would show that any of the buildings and other installations or improvements on the Leased Property are or will become subject to any outstanding work order or notice of defect or non-compliance from any Authority.

Notwithstanding anything contained in this Agreement, in cases where the rights and benefits of the Vendor to any of the Leased Properties arise out of a sublease, the Vendor makes no representations regarding the force and effect of the head lease, the compliance of the sublandlord with the terms and conditions of such head leases, or to any default existing under such head leases which may result in the cancellation or disclaimer of the related Leases. Subject to the foregoing, the Vendor has not received any written notice in respect of any defaults under any such head leases.

Except as described in Section 4.19(a) of Schedule 4.19, to the knowledge of the Vendor, the Business and all operations on the Leased Property are in material compliance with Environmental Laws, and, to the knowledge of the Vendor, there are no orders under or pursuant to Environmental Laws by any Authority issued or pending with respect to the Leased Property.

To the knowledge of the Vendor, the Vendor has all material Environmental Permits required under Environmental Laws for the operation of the Business, all of which are described in Section 4.19(b) of Schedule 4.19, other than any Environmental Permits included in the Excluded Assets. To the knowledge of the Vendor, each such Environmental Permit is valid, subsisting and in good standing, and the Vendor is not in default or breach of any such Environmental Permit.

Except as disclosed in Section 4.19(c) of Schedule 4.19, to the Vendor’s knowledge, there are no underground storage tanks at any Leased Property that could give rise to any claims against or obligations or liabilities for the Vendor under Environmental Laws. To the knowledge of the Vendor, the Vendor has not removed, closed or abandoned any underground storage tanks at the Leased Property in a manner that could give rise to any claims against or obligations or liabilities for the Vendor under Environmental Laws, and, to the Vendor’s knowledge, any and all underground storage tanks that have been removed from the Leased Property have been removed or closed in accordance with all Environmental Laws.

Schedule 4.22 contains a complete and accurate list of all individuals by employee number who are full-time, part-time or casual employees or individuals engaged on contract to provide employment or consulting services to a Company in connection with the Business (the “Employees”) as of March 31, 2009 specifying the length of hire, title or classification and rate of salary or hourly pay and commission or bonus entitlements (if any) for each such Employee. The Purchaser agrees to keep such employee information confidential.

All employment, management and consulting Contracts pursuant to which Employees have been engaged by each Company are set out in Schedule 2.1(b) and, except as disclosed in Schedule 2.1(b), there are no incentives or special compensation arrangements, contracts or agreements with respect to any Employees of the Companies.

Each Company has duly and timely made all deductions (including Tax deductions) required by Applicable Law or by Contract to be made from employee wages, salaries or benefits relating to a period ending on or prior to the Closing Date and has duly and timely remitted the amounts deducted and all related employer contributions required to the appropriate, insurers and Authorities for all periods ending on or prior to the Closing Date.

Each Company is in compliance in all material respects with all applicable Employment Legislation.

To the knowledge of the Vendor, there are no circumstances, claims or frequency of claims which may expose the Purchaser to any charges or assessments on account of workplace safety and insurance or workers’ compensation, other than the standard charges or assessments for the rate group and classification of the Business.

Except as disclosed in Schedule 4.22, no Employee or former Employee of either Company is in receipt of and, to the knowledge of the Vendor, no Employee or former Employee has threatened to make, a claim for any benefits under any weekly indemnity, sickness and accident, long term disability or workers’ compensation plan or arrangement or any other form of disability benefit program. All assessments, penalties, fines, levies, charges, surcharges, Taxes, premiums or other amounts due and payable and relating to any disability insurance arising on or prior to the Closing Date or relating to a period ending on or prior to the Closing Date have been or will be paid by a Company on or prior to the Time of Closing.

Other than as disclosed in Schedule 4.22, there are no complaints, applications, investigations, orders, prosecutions or proceedings against either Company under the Pay Equity Act (Ontario).

Any unpaid Taxes, penalties, interest or other amounts due under the Employer Health Tax Act (Ontario) and payable by any of the Companies on or prior to the Closing Date or relating to a period ending on or prior to the Closing Date have been paid or will be paid by such Company on or prior to the Time of Closing. Each Company is in compliance with the Employer Health Tax Act (Ontario).

Schedule 4.23 identifies each retirement, pension, supplemental pension benefit, bonus, stock purchase, profit sharing, stock option, deferred compensation, severance or termination pay, insurance, medical, hospital, dental, vision care, drug, sick leave, disability, salary continuation, legal benefits, unemployment benefits, vacation, pay equity, incentive or other compensation plan or arrangement or other employee benefit which is maintained, or otherwise contributed to or required to be contributed to, by the Vendor for the benefit of Employees (the “Employee Plans”). Each Employee Plan has been maintained, administered and funded in material compliance with its terms and with the requirements prescribed by any and all statutes, orders, rules and regulations that are applicable to such Employee Plan. The Vendor has made available to the Purchaser summaries or current and complete copies of all Employee Plans.

All material obligations of each Company required to be performed in connection with the Employee Plans established therefor up to the date hereof have been performed, and there are no outstanding defaults or violations by any party thereto. There have been no improper withdrawals, applications or transfers of assets from any Employee Plans.

All required contributions and/or premiums to be made under the Employee Plans have been fully paid to the date hereof in a timely fashion in accordance with the terms of that Employee Plan and all Applicable Law, and no Taxes, penalties or fees are owing or eligible under any Employee Plans.

There are no outstanding actions, suits or claims pending or, to the knowledge of the Vendor, threatened concerning the assets held in respect of the Employee Plans (other than routine claims for the payment of benefits submitted by members or beneficiaries in the normal course), and there is no litigation, legal action, suit, investigation, claim, counterclaim or proceeding pending or, to the knowledge of the Vendor, threatened concerning the Employee Plans.

To the knowledge of the Vendor, no written or oral representations or promises have been made to the Employees to establish new employee plans or to increase the benefits under the existing Employee Plans.

those matters set out in Sections 4.1, 4.2 and 4.3(a) which shall survive the Closing Date indefinitely;

the Vendor’s representations and warranties relating to tax matters arising in or in respect of a particular period ending on, before or including the Closing Date shall survive until the Tax Authorities shall no longer be entitled to assess or reassess liability for Taxes against the Vendor or ###-###-#### for that particular period, having regard, without limitation to any waivers given by the Vendor or ###-###-#### in respect of any taxation year; and

fraudulent or willfully false representations and warranties which shall survive indefinitely,

The Vendor agrees to provide the Purchaser with an up-to-date list of the names of the Employees at least two (2) Business Days and not more than four (4) Business Days prior to the Closing Date. The Purchaser agrees that, as soon as practicable following the Effective Time, it shall provide written offers of employment to all Employees on such list effective as at the Effective Time, on terms and conditions of employment substantially similar to, and at least as favourable as, the terms and conditions of employment then applicable to the Employees. Except as provided in this Section 7.7, the Purchaser shall not be obligated to any Employee who refuses the Purchaser’s offer of employment. The Vendor shall approve the written offers of employment prior to the Purchaser providing such letters to the Employees. Such approval by the Vendor shall not be unreasonably withheld or delayed. The Vendor shall render all reasonable assistance to encourage each Employee to accept the Purchaser’s offer of employment.

The Vendor shall employ all of the Employees set out in Schedule 4.16 until the Time of Closing except for any Employees who prior to the Time of Closing: (i) are terminated for cause; (ii) are terminated with the Purchaser’s consent, which consent shall not be unreasonably withheld; (iii) voluntarily resign; or (iv) retire.

During the period from March 28, 2009 to the Time of Closing, the Vendor shall not have hired any employees or increased the wages of any Employees, except in the normal course or as required by contract or Applicable Law, or with the written consent of the Purchaser.

Within five (5) Business Days following the Closing Date, the Vendor shall settle, and pay to each of the Employees, all salaries, commissions, bonuses, and other amounts that may become payable to or receivable by such Employees for all periods ending on or before the Closing Date, including accumulated vacation not provided for as an Assumed Liability or on the Closing Balance Sheet with pay credits in respect of their employment with the Business or any predecessor of the Business, and all termination and severance payments and benefits claimed by any Employees who do not accept offers of employment made by the Purchaser in accordance with Section 7.7(a).

The Purchaser shall be solely responsible for, and shall indemnify the Vendor from and against, all salaries, commissions, bonuses and other amounts payable to Employees in relation to any period of employment by the Purchaser and all termination and severance payments and benefits claimed by any Employees who are terminated or permanently laid off by the Purchaser after the Closing Date.

The Employees shall cease to participate in, accrue benefits under or be covered by the Employee Plans set out in Schedule 7.7(f) (the “Terminated Plans”) as of the Closing Date. Effective on the Closing Date, the Purchaser shall establish employee plans (the “Purchaser Employee Plans”) which shall provide the Employees with benefits that are substantially similar to and no less favourable than those of the Terminated Plans in effect on the day prior to the Closing Date. As of the Closing Date, the Employees shall commence participation in, accrue benefits under and be covered by the Purchaser Employee Plans. In the event that the Purchaser Employee Plans are not established as of the Closing Date, the Purchaser shall advise the Vendor as far in advance of the Closing Date as is possible. In that event, the Vendor will use commercially reasonable efforts to continue the Terminated Plans such that the Employees shall be able to continue to participate in such Terminated Plans for a period not exceeding 60 days from the Closing Date (the “Transition Period”). The Vendor and the Purchaser shall cooperate to facilitate the transition of the member data and history from the Terminated Plans to the Purchaser Employee Plans during the Transition Period. The Purchaser shall be responsible for all administrative and accounting procedures necessary to allow Employees to participate in the Terminated Plans and shall be responsible for and pay all costs and expenses, including premiums, incurred by the Vendor during the Transition Period in connection with such Terminated Plans for the Employees.

The Purchaser will ensure that evidence of insurability or pre-existing conditions and eligibility periods in respect of the Purchaser Employee Plans are waived. The Purchaser Employee Plans shall honour any deductible, co-payment, coinsurance, or eligible out-of-pocket expenses paid or incurred by the Employees, including with respect to their covered dependants, under the Terminated Plans from the beginning of the current coverage period to the Closing Date, as though such amounts had been paid in accordance with the terms and conditions of the Purchaser Employee Plans.

The Purchaser Employee Plans shall recognize service and earnings of the Employees as recognized under the Terminated Plans for eligibility and determination of benefits under the Purchaser Employee Plans.

The Vendor agrees that it is responsible under the Employee Plans for any non- pension benefit related claims arising in respect of the Employees prior to the Closing Date, in accordance with the terms of such Employee Plans and Applicable Law. The Purchaser agrees that it is responsible for any non-pension benefits related claims arising in respect of the Employees from and after the Closing Date in accordance with the terms of the Purchaser Employee Plans and Applicable Law. For greater certainty, the date on which a benefit claim arose will be:

in the case of a death claim, the date of death;

in the case of extended health care benefits, including, without limitation, dental and medical treatments, the date of treatment;

in the case of a claim for drug or vision care benefits, the date the prescription is filled; and

in the case of a disability claim, the date on which the disability occurred.

The Vendor agrees to transfer and assign, and the Purchaser agrees to assume, those Employee Plans specified in Schedule 7.7(j).

maintain its existence and hold the Rights as bare trustee and agent for the Purchaser;

comply with the terms and provisions of the Rights as bare trustee and agent for the Purchaser at the Purchaser’s cost and for the Purchaser’s benefit;

cooperate with the Purchaser in any reasonable and lawful arrangements designed to provide the benefits of such Rights to the Purchaser; and

enforce, at the request of the Purchaser and at the expense and for the account of the Purchaser, any rights of the Vendor arising from such Rights against any third Person, including the right to elect to terminate any such rights in accordance with the terms of such rights upon the written direction of the Purchaser.

The Vendor shall at its own expense duly and timely make or prepare all Tax Returns required to be made or prepared by ###-###-#### and duly and timely file all Tax Returns required to be filed by ###-###-#### with the appropriate Tax Authority for any period ending before the acquisition of control of ###-###-#### by the Purchaser for which Tax Returns have not already been filed. Each Tax Return to be prepared and filed in accordance with this Section 7.9 shall be correct and complete. Such Tax Returns shall be subject to reasonable review by the Purchaser.

The Purchaser shall using commercially reasonable efforts to co-operate with the Vendor in the preparation of any such Tax Returns, including, without limitation, by providing access to any Books and Records or other documents required by the Vendor in order to fully and completely prepare any such Tax Returns or other documentation.

The Vendor hereby acknowledges and agrees that it shall be a condition of Closing that, on or before the Closing Date, the Vendor shall obtain the prior written consent to the Assignment of Lease from each landlord in respect of each of the Leased Properties listed in Section 1 of Schedule 4.13 hereto (hereinafter, collectively, the “Principal Sites” and each, individually, a “Principal Site”). The Vendor shall use reasonable commercial efforts to provide the Purchaser with an Estoppel and Consent Certificate for each Principal Site.

The Vendor further covenants and agrees that, immediately following the Closing Date, the Vendor shall make written requests for the formal written consent of each landlord to the Assignment of Lease in respect of each of the Leased Properties listed in Section 2 of Schedule 4.13 hereto (hereinafter, collectively, the “Non-Assigned Leases” and each, individually, a “Non-Assigned Lease”), and shall also use reasonable commercial efforts to obtain and provide to the Purchaser an Estoppel and Consent Certificate from each landlord in respect of each Non-Assigned Lease. Until such time as such consents have been obtained in respect of the Non-Assigned Leases as aforesaid, the following provisions shall apply:

The Vendor shall use continuous reasonable commercial efforts, at its sole cost and expense, to obtain and provide to the Purchaser the written consent to the Assignment of Lease, from each landlord for each of the Non-Assigned Leases within twelve (12) months from the Closing Date;

The Non-Assigned Leases shall remain in the name of the Vendor and the Vendor shall hold its interest in the Non-Assigned Leases and the Leased Properties associated therewith in trust as bare trustee for the benefit of the Purchaser and shall deal with such Non-Assigned Leases, and the Vendor’s interest thereunder, as the Purchaser shall in writing reasonably direct;

The Vendor shall continue to pay all rent and other payments due and owing by the Vendor, as tenant under the Non-Assigned Leases, and shall continue to observe and perform all of the obligations and covenants of the tenant under such Non-Assigned Leases (including, without limitation, maintenance and repair obligations, and the obligations of the Vendor, as tenant, to maintain insurance as more particularly set out thereunder);

The Vendor shall use continuous reasonable commercial efforts to provide the Purchaser with continuous, uninterrupted access to, and the right to use and occupy, those Leased Properties which form the subject of the Non-Assigned Leases, so as to enable the Purchaser to conduct the Business from such Leased Property in the manner consistent, to the greatest extent possible, with the manner in which the Business was conducted by the Vendor prior to the Time of Closing;

The Purchaser shall use continuous reasonable commercial efforts to cooperate and assist the Vendor, at the Vendor’s reasonable request, to obtain the written consent to the Assignment of Lease from each landlord for each of the Non-Assigned Leases; provided, for greater certainty that the Purchaser shall not be required to incur any out-of-pocket expense in providing such cooperation and assistance.

In respect of each of the Non-Assigned Leases, the Vendor and the Purchaser shall enter into an interim occupancy agreement (each an “Interim Occupancy Agreement”), as of the Closing Date, substantially in the form annexed hereto as Exhibit F, providing for the terms under which Purchaser will occupy such Leased Property and such additional assurances relating to such Leased Property as may be requested of the Vendor by the Purchaser from time to time, and the Vendor shall take, or cause to be taken, such reasonable actions, either in the Vendor’s name or otherwise as the Purchaser may reasonably require, so as to provide the Purchaser with, and not to deprive the Purchaser of, the right to conduct the Business from each such Leased Property

The Vendor shall indemnify and save harmless the Purchaser, and its directors, officers, employees, agents and successors, from and against any Losses suffered or incurred by any of them as a result of the Purchaser being required to vacate any Leased Property that is occupied by the Purchaser under an Interim Occupancy Agreement upon termination of, or interruption or interference with, its use, occupancy and enjoyment of any portion of such Leased Property within a period of twelve (12) months from the Closing Date.

The obligations of this Section 7.10 shall survive the Closing Date and the said obligations shall not merge but shall remain in full force and effect as of the Closing Date and thereafter.

Representations and Warranties. The representations and warranties of the Vendor contained in this Agreement or any certificate or other document delivered pursuant hereto shall be true and correct at the Time of Closing in all material respects with the same force and effect as if such representations and warranties were made at and as of such time, except for any such representations and warranties that refer to or are expressed to be made as of a specific date, including the date of this Agreement, in which case such representations shall be true and correct in all material respects as of such date, and a certificate executed by the Vendor dated the Closing Date, to that effect shall have been delivered to the Purchaser;

Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by the Vendor at or before the Time of Closing shall have been complied with or performed in all material respects, and a certificate executed by a senior officer of the Vendor, dated the Closing Date, to that effect shall have been delivered to the Purchaser;

Regulatory Consents. There shall have been obtained from all appropriate Authorities such consents and approvals as are required to be obtained by the Vendor to permit the change of ownership of the Purchased Assets contemplated hereby, including, without limitation, those described in Schedule 4.8(a);

Required Contractual Consents. Subject to Section 7.10, the Vendor shall have given or obtained the notices, consents and approvals described in Schedule 4.8(b);

No Action or Proceeding. No legal or regulatory action or proceeding shall be pending or threatened by any person to enjoin, restrict or prohibit the purchase and sale of the Purchased Assets contemplated hereby or the performance of any party’s obligations in this Agreement;

Workplace Safety and Insurance. The Vendor shall provide a clearance certificate or other similar documentary evidence from the Workplace Safety and Insurance Board or similar authority in each jurisdiction where the Vendor carries on the Business certifying that there are no outstanding assessments, penalties, fines, levies, charges, surcharges or other amounts due or owing to those authorities;

Retail Sales Tax. The Vendor shall deliver to the Purchaser on the Closing Date a certificate issued by the Minister of Finance of Ontario under subsection 6(1) of the Retail Sales Tax Act (Ontario);

Concurrent Transactions. The transactions set forth under the HearUSA Licence shall be completed in escrow with effect immediately prior to these transactions, such that the Purchaser shall at the Closing acquire by assignment the HearUSA Licence;

Delivery of Conveyancing Documents. The Vendor shall deliver to the Purchaser all necessary deeds, conveyances, bills of sale, assurances, transfers, assignments and any other documentation reasonably required by the Purchaser to transfer the Purchased Assets to the Purchaser with a good title, free and clear of all Encumbrances, except for Permitted Encumbrances.

Closing Documents. Without limiting the generality of any other provision of this Section 8.1, the Purchaser shall have received at or before the Time of Closing sufficient duly executed original copies of the following:

certified copies of resolutions of: (i) the board of directors of HearUSA, (ii) the board of directors of ###-###-####, and (iii) the board of directors and shareholders of the Vendor, approving the transfer of the Purchased Assets and this Agreement and the transactions contemplated under this Agreement, as applicable;

a certificate of an officer of each the Companies confirming the matters contemplated in Section 8.1(a) and confirming that all conditions under this Agreement in favour of the Vendor have been either fulfilled or waived;

certificates of incumbency of each of the Companies and HearUSA;

certificates of status/compliance of each of the Companies and HearUSA;

certified copies of the articles of incorporation and by-laws of each of HearUSA and the Companies;

share certificates representing the Purchased Shares duly endorsed for transfer;

all of the books and records, including minute books and share certificate books of ###-###-####;

a DVD in containing all data, current as of not more than three (3) Business Days prior to the Closing Date, constituting the Helix Database (as such term is defined in the Support Agreement);

the Escrow Agreement executed by the Vendor and the Escrow Agent;

the Non-Competition Agreement executed by each of HearUSA and the Vendor;

the Accounts Receivable Trust Agreement executed by the Vendor and, for the purposes only of its guarantee therein, HearUSA;

the Support Agreement executed by HearUSA;

the Assignment of Leases for each of the Principal Sites, each on terms acceptable to the Purchaser, acting reasonably, executed by the Vendor and each applicable landlord;

the Interim Occupancy Agreements, for those Leased Properties that are the subject of Non-Assigned Leases, executed by the Vendor;

an assignment of the HearUSA License by the Vendor in favour of the Purchaser, on terms acceptable to the Purchaser acting reasonably.

an opinion dated the Closing Date from counsel for the Companies confirming the matters warranted in subsections 4.1 Organization, 4.2(a) Authorization, 4.2(b) Enforceability of Obligations and 4.3(a) Authorized Capital of ###-###-####, and of HearUSA confirming the matters warranted in subsection 4.2(b) Enforceability of Obligations, and such other matters as Purchaser’s counsel may require.

Representations and Warranties. The representations and warranties of the Purchaser contained in this Agreement or any certificate or other document delivered pursuant hereto shall be true and correct in all material respects at the Time of Closing with the same force and effect as if such representations and warranties were made at and as of such time, and a certificate executed by the Purchaser, dated the Closing Date, to that effect shall have been delivered to the Vendor;

Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by the Purchaser at or before the Time of Closing shall have been complied with or performed in all material respects, and a certificate executed by a senior officer of the Purchaser, dated the Closing Date, to that effect shall have been delivered to the Vendor; and

No Action or Proceeding. No legal or regulatory action or proceeding shall be pending or threatened by any person to enjoin, restrict or prohibit the purchase and sale of the Purchased Assets contemplated hereby or the performance of any party’s obligations under any agreement contemplated in this Agreement to be executed and delivered by either party at the Time of Closing;

Concurrent Transactions. Concurrently with the Closing, HearUSA, as vendor, and ###-###-#### Ontario Inc., as purchaser, shall have completed the purchase and sale of a payment stream under the Support Agreement, on terms and conditions satisfactory to HearUSA;

Closing Documents. Without limiting the generality of any other provision of this Section 8.2, the Vendor shall have received at or before the Time of Closing sufficient duly executed original copies of the following:

certified copies of resolutions of the board of directors of the Purchaser, approving the purchase of the Purchased Assets and this Agreement and the transactions contemplated under this Agreement;

a certificate of an officer of the Purchaser confirming the matters contemplated in Section 8.2(a) and confirming that all conditions under this Agreement in favour of the Purchaser have been either fulfilled or waived;

a certificate of Jeffrey Geigel confirming that as of the Closing Date he has no actual knowledge of any existing breach of the representations and warranties of the Vendor contained in Article 4;

certificates of incumbency of the Purchaser;

certificates of status/compliance of each of the Purchaser;

certified copies of the articles of incorporation and by-laws of the Purchaser;

the Assignment of Leases for each of the Principal Sites, each on terms acceptable to the Vendor, acting reasonably;

the Interim Occupancy Agreements executed by the Purchaser for those Leased Properties that are the subject of the Non-Assigned Leases;

the Escrow Agreement executed by the Purchaser and the Escrow Agent;

the Support Agreement executed by the Purchaser; and

an assumption of the HearUSA License by the Purchaser.

any breach by the Vendor of any representation or warranty of the Vendor contained in this Agreement;

any breach or non-performance by the Vendor of any covenant to be performed by it which is contained in this Agreement;

any failure by the Vendor to pay, satisfy, discharge, perform or fulfil any of the Excluded Liabilities and non-compliance by the Vendor with the Bulk Sales Act (Ontario).

any breach by the Purchaser of any representation or warranty contained in this Agreement;

any breach or non-performance by the Purchaser of any covenant to be performed by it which is contained in this Agreement; and

any failure by the Purchaser to pay, satisfy, discharge, perform or fulfil any of the Assumed Liabilities or any liabilities and obligations of the Business after Closing.

With respect to any Direct Claim, following receipt of notice from the Indemnified Party of the Claim, the Indemnifying Party shall have sixty (60) Business Days (for the purposes of this Section, the “Investigation Period”) to make such investigation of the Claim as is considered necessary or desirable. For the purpose of such investigation, the Indemnified Party shall make available to the Indemnifying Party the information relied upon by the Indemnified Party to substantiate the Claim, together with all such other information as the Indemnifying Party may reasonably request. If both parties agree at or prior to the expiration of the Investigation Period (or any mutually agreed upon extension thereof) to the validity and amount of such Claim, the Indemnifying Party shall immediately pay to the Indemnified Party the full agreed upon amount of the Claim. If the parties are unable to resolve the dispute within a reasonable time, and in any event within thirty (30) Business Days of such written request, the dispute shall, at the request of either party, be determined by a court of competent jurisdiction.

In connection with a Direct Claim arising out of a breach by the Vendor of its representation and warranty contained in Section 4.9, during the Investigation Period, the parties shall investigate the Claim for the purposes of making a determination as to whether or not any uncollected Accounts Receivable are in fact ultimately collectible. A Direct Claim in respect of such matter shall only be deemed to be valid to the extent that there is not a substantial likelihood that such Accounts Receivable are collectible through reasonable commercial efforts. If the parties are unable to resolve the dispute within a reasonable time, and in any event within thirty (30) days of such written request, the Vendor and the Purchaser shall submit the issues remaining in dispute to PriceWaterhouse Coopers, Toronto (the “Independent Accountants”) for resolution. If issues are submitted to the Independent Accountants for resolution, (i) the Vendor and the Purchaser shall furnish or cause to be furnished to the Independent Accountants such working papers and other documents and information relating to the disputed issues as the Independent Accountants may request and are available to that party or its agents and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and to discuss the issues with the Independent Accountants; (ii) the determination by the Independent Accountants, as set forth in a notice to be delivered to both the Vendor and the Purchaser within thirty (30) days of the submission to the Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the parties and shall be determinative of the amount of the Purchaser’s Direct Claim; and (iii) the unsuccessful party in respect of the aggregate of the issues in dispute shall bear the fees and costs of the Independent Accountants for such determination. The determined amount of the Direct Claim, if any, shall be paid within three (3) Business Days after the Independent Accountant’s determination becomes binding and conclusive on the parties pursuant to this Section 10.4(b).

Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered by personal delivery, by overnight courier, by telecopy or by registered mail addressed as follows:

Any such notice or other communication delivered by personal delivery or overnight courier shall be deemed to have been given and received on the day on which it was delivered (or, if such day is not a Business Day, on the next following Business Day), and if transmitted by telecopier, on the day of transmission thereof if such day is a Business Day and is received before 5:00 pm (local time to the recipient) or otherwise on the next Business Day after the day of transmittal, provided that the party so transmitting the notice has received confirmation of its successful transmittal, and if mailed or sent by registered mail, on the fifth Business Day following the date of mailing; provided, however, that if at the time of mailing or within three Business Days thereafter there is or occurs a labour dispute or other event which might reasonably be expected to disrupt the delivery of documents by mail, any notice or other communication hereunder shall be delivered or transmitted by means personal delivery, telecopier or recorded electronic communication as aforesaid. Either party may at any time change its address for service from time to time by giving notice to the other party in accordance with this Section 12.1.