MEMBERSHIP AGREEMENT. - and - - and - - and. NORTHERN SUNRISE COUNTY (hereinafter referred to as "NSC") - and

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1 MEMBERSHIP AGREEMENT THIS AGREEMENT made in effective the day of, 20 AMONG: TOWN OF PEACE RIVER (hereinafter referred to as "Peace River") OF THE FIRST PART - and - MUNICIPAL DISTRICT OF PEACE NO. 135 (hereinafter referred to as "MD of Peace") OF THE SECOND PART - and - COUNTY OF NORTHERN LIGHTS (hereinafter referred to as "Northern Lights") OF THE THIRD PART - and NORTHERN SUNRISE COUNTY (hereinafter referred to as "NSC") - and TOWN OF GRIMSHAW (hereinafter referred to as "Grimshaw") OF THE FOURTH PART OF THE FIFTH PART (Whereby Peace River, MD of Peace, Northern Lights, NSC and Grimshaw are hereinafter collectively referred to as the "Municipalities") - and - PEACE RIVER REGIONAL AIRPORT SOCIETY (hereinafter referred to as the "Society") OF THE SIXTH PART WHEREAS: A. Each Municipality has applied for membership in the Society pursuant to Section 3.1 of the Bylaws of the Society; B. It is a condition of membership in the Society that this Membership Agreement be executed by the Municipality; C. the Board of Directors of the Society, subject to compliance by the Municipality with all requirements pursuant to the Bylaws, has resolved to admit the Municipality as a Municipality of the Society; NOW THEREFORE, THIS AGREEMENT WITNESSETH that in consideration of the payment of the sum of Ten ($10.00) Dollars by a Municipality to the Society and that the premises and the mutual agreements and conditions herein contained the parties hereby agree as follows:

2 - 2 - ARTICLE 1 - INTERPRETATION 1.1 Definitions In this Agreement unless there is something in the context inconsistent therewith the following words and phrases will have the following meanings: (d) (e) (f) (g) (h) (j) (k) (l) "Act" means the Societies Act RSA 2000 c. S-14, as amended from time to time; "Advances" means all outstanding loans due and owing from time to time by the Society to a Municipality; "Allocation Formula" means that formula set forth in Schedule "A" hereto; "Appoint" includes "elect" and vice versa; "Board" means the Board of Directors of the Society; "Bylaws" means the Bylaws of the Society as from time to time amended or restated; "Director(s)" means the person(s) who is/are from time to time elected or appointed as Director(s) of the Society; "Dispute Resolution Procedure" means that dispute resolution procedure as set forth in the attached Schedule "B"; "Effective Date" means the date hereof; "Municipality's Interest" means all right, title and interest of a Municipality in and to any Advances and any other right or claim a Municipality may have against the Society as a Municipality; "Officer(s)" means any officer(s) of the Society; "Ordinary Resolution" means a resolution: (ii) Passed by a majority of the votes cast by the Municipalities who voted in respect of that resolution; or Signed by a majority of the Municipalities entitled to vote on that resolution; (m) (n) (o) "Parties" means the parties to this Agreement; "Prime Rate" means the percentage rate of the interest per annum which is established and charged from time to time by the financial institution of the Society, on loans to its most creditworthy and preferred commercial borrowers. A statement or statements in writing made by the Manager of the said financial institution, as to the Prime Rate, from time to time, shall be final and conclusive as evidencing the Prime Rate during the operative time of the statement and shall not be open to dispute or challenge by the parties. Any change in the Prime Rate shall be effective on the banking day upon which the said financial institution changes its Prime Rate, and such rate of interest shall be changed automatically without notice to the Parties; "Special Resolution" a resolution; Passed by 2/3rds of the votes cast by those who voted in respect of that resolution; or

3 - 3 - (ii) Signed by 2/3rds of those entitled to vote on that resolution; (p) "Triggering Event" means any one or more of the following: (ii) the failure by the Municipality to obtain, perform or carry out any of its obligations hereunder where such failure continues for thirty (30) days after notice in writing from the Society demanding that such default be cured; and the failure by the Municipality to take reasonable action to prevent or defend any action or proceedings whereby any of its Municipality's Interest is seized or if there be an execution or attachment thereof, where such failure continues for thirty (30) days after the Society has demanded in writing that the Municipality take such reasonable action and the Municipality fails to take any such action or proceedings. 1.2 Defined Terms Words and phrases used in this Agreement and not defined herein have the same meaning assigned to them respectively in the Act. 2.1 Effective Agreement ARTICLE 2 - IMPLEMENTATION OF AGREEMENT The Municipalities shall vote in such a way as to fully implement the terms and conditions of this Agreement and shall forthwith take such steps as are necessary to remove any Director who refuses to exercise his discretion in accordance with the terms of this Agreement. 2.2 Conflict In the event of any conflict between the provisions of this Agreement and the Bylaws, the provisions of this Agreement shall govern. The Municipalities agree to vote so as to cause the Bylaws to be amended to resolve any such conflict in favour of the provisions of this Agreement. 2.3 Effective Date All of the mutual covenants and agreements herein contained became effective and binding upon the Parties as and from the Effective Date and this Agreement shall continue in full force and effect from the Effective Date until termination in accordance with the terms of this Agreement. 2.4 Termination This Agreement shall cease and terminate on the occurrence of any of the following events, namely: the bankruptcy or receivership of the Society; the passing of a resolution for winding up the Society or the winding up of the Society pursuant to the Act; or the execution of any agreement of termination in writing by the Parties.

4 - 4 - ARTICLE 3 - CONDUCT OF THE AFFAIRS AND BUSINESS OF THE SOCIETY 3.1 Board of Directors The Municipalities agrees that the affairs of the Society shall be managed by the Board of Directors appointed in accordance with the Bylaws and, provided that each Municipality remains a Municipality in good standing of the Society, including, but not limited to satisfaction of the requirements by the Society to pay such amounts required to be paid to the Society when due, each Municipality shall be entitled to appoint the Directors to the Board of Directors as set forth in Section 3.2 hereof. 3.2 Appointment of Directors Each Municipality shall have the right to appoint one (1) Director to the Board of Directors. Municipality shall immediately upon becoming a Municipality notify the Society in writing of the name of the designate(s) of the Municipality to act as Director(s) and shall, from time to time, notify the Society in writing upon the request of the Society of the identity of such Director(s). It is further provided that: (ii) Each Municipality may remove from office as a Director, any such person that was nominated by the respective Municipality in Section 3.2 hereof, by providing a resolution of council of the Shareholder; Each Municipality shall remove any Director who refuses to comply with the terms of this Agreement or the Bylaws. 3.3 Conduct of the Affairs of the Society The Municipalities agree that, unless authorized by a resolution passed by a Special Resolution of the Municipalities or consented to in writing by all of the Municipalities, the Municipalities shall not cause or permit the Society and the Board shall not authorize the Society to: (d) (e) (f) (g) (h) take or institute any proceedings for the winding up, reorganization or dissolution of the Society; enter into any non-budgeted financial commitment of any type whatsoever including without limiting the foregoing, any purchase, sale, lease, loan, borrowing or expenditure, where such financial commitment is in excess of the sum of Ten Thousand ($10,000.00) Dollars for any single transaction. Notwithstanding the foregoing sentence in this Section 3.3 hereof, if there is an emergency that requires the immediate expenditure of funds and is one that cannot wait for the approval of the Municipalities, the Directors may spend such money that they feel is necessary, acting reasonably, in order to alleviate the emergency; sell, lease or exchange all or substantially all of the property of the Society other than in the ordinary course of business; give financial assistance to any person; change the accountants or other professionals that provide the Society advice from time to time; borrow money on the credit of the Society be continued as a body corporate under the laws of another jurisdiction; reorganize;

5 - 5 - (j) (k) (l) (m) (n) (o) (p) purchase or sell any real or immovable property; enter into of any partnerships or joint ventures; amend, repeal, or enact any Bylaws other than those already in place; enter into any contract outside of the Society's ordinary course of business; make a general assignment for the benefit of creditors; make a voluntary assignment to a trustee in bankruptcy; issue, re-issue, sell or pledge debt obligations of the Society; or mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Society owned or subsequently acquired, to secure any obligation of the Society. 3.4 Operations and Banking The Municipality acknowledges and agrees that: all monies received on account of the Society's operations from time to time shall be immediately paid into the bank of the Society and all disbursements in respect of the Society expenditures shall be paid by cheque on such bank; any one of the Chair of the Society or the Vice-chair of the Society together with any one of the Chair or Secretary-Treasurer are authorized to make, sign, draw, accept, negotiate, endorse, execute and deliver all or any cheques, promissory notes, drafts, acceptances, bill of exchange, orders for the payment of money, and other instruments whether negotiable or not on behalf of the Society; the Society shall keep detailed records and books of account prepared in accordance with generally accepted accounting principles. The Society shall distribute annual audited financial statements to each Municipality within seven (7) days of the Society s receipt thereof. ARTICLE 4 - FINANCING 4.1 Budget All operating and capital expenditures of the Society shall be made in accordance with the budgets established by the Board of Directors and approved of by a resolution of no less than four of the Municipalities. In the event that the Municipalities do not agree on an acceptable budget for the Society within 45 days of the Board of Directors presentation of a proposed budget, the Members shall implement the Dispute Resolution Procedure to resolve same. 4.2 Membership Fees All capital, operating, closure and replacement funds required to construct, maintain, manage, operate, use and replace any of the assets of the Society shall be provided by the Municipalities as membership fees, which membership fees shall be calculated in accordance with the Allocation Formula and notice of such membership fee shall be provided by the Board to each Municipality following the approval of the budget for the then current fiscal year. 4.3 Municipality Advances

6 - 6 - If authorized by a unanimous resolution of the Municipalities, the Society may make a written request to each Municipality for an Advance to be made by each Municipality in accordance with the Allocation Formula. The Municipalities agree to deliver the monies so requested within thirty (30) days of receipt of the written request therefor. No Advances shall bear interest and the Municipalities agree that it shall not demand repayment of any Advances. If the Society repays any Advances in whole or in part, it shall, subject to any express agreement amongst all of the Municipalities to the contrary, do so in accordance with the Allocation Formula. 4.4 Requirements to Pay Share of Allocation Formula and Advances Notwithstanding any provision contained herein to the contrary, the obligation by the Municipalities to deliver an Advance to the Society in accordance with the Allocation Formula is and shall remain a condition precedent to membership status in the Society. The Parties agree that failure to pay such funds pursuant to the Allocation Formula or Advances as required by the Society will entitle the Society to terminate the entitlement of the Municipality to the benefits of membership that are available to Municipalities and terminate the membership of the Municipality. 4.5 Availability of Membership Benefits ubject to the performance of all of the obligations of the Municipalities pursuant to this Agreement and pursuant to the Bylaws, the Society will make available to all of the Municipalities all of the benefits of membership that are available to all Municipalities, from time to time. 5.1 Administration and Financial Activities ARTICLE 5 - FINANCIAL OPERATION The parties agree that all administration and financial activities carried out on behalf of the Society shall be carried out by the Chair. 6.1 Remedies ARTICLE 6 - DEFAULT Upon the occurrence of a Triggering Event, the Society may do any one or more of the following: (d) pursue any remedy against the Municipality available to it at law or in equity, it being acknowledged that specific performance, injunctive relief (mandatory or otherwise) or other equitable relief may be the only adequate remedy for a default; take such actions as may reasonably be required, to cure the default, in which event all payments, costs and expenses incurred therefor shall be payable by the Municipality to the Society on demand with interest at a rate equal to the Prime Rate in effect at the time plus two (2%) percent per annum; or waive the default provided, however, that any waiver of a particular default shall not operate as a waiver of any subsequent or continuing default; or terminate the entitlement of the Municipality to the benefits of membership that are available to the Municipalities ARTICLE 7 - APPORTIONMENT OF LIABILITY 7.1 Apportionment

7 - 7 - If any Municipality becomes jointly and severally liable for any matter relating to the Society, the respective liability of each of the Municipalities, as between themselves, shall be apportioned and limited in accordance with the respective percentage allocation of each Municipality as set forth in the Allocation Formula and adjusted to take into account the period during which the liability relates and the Municipality was a Municipality. The Municipalities specifically agree that they will take such action as may be required to ensure that their respective contribution arising out of any such liability is apportioned strictly in accordance with the Allocation Formula notwithstanding the termination of its membership and the obligations stated herein shall survive the termination of the membership of the Municipality and the termination of this Agreement. 8.1 Termination ARTICLE 8 - TERMINATION OF MEMBERSHIP The Municipalities will only terminate its membership in the Society in accordance with Section 4.1 of the Bylaws. Upon termination of its membership, the Municipalities shall have no claim to any operating surplus or assets (tangible or intangible) of the Society in any manner. 9.1 Dissolution or Winding Up ARTICLE 9 - DISTRIBUTION OF PROPERTY Upon the dissolution or winding up of the Society and after payment of all debts and liabilities of the Society, the remaining property of the Society shall be distributed to those Municipalities in accordance with the percentage allocation for each Municipality of the Society as calculated in the Allocation Formula. The Municipality specifically agrees that it will take such actions as may be required to ensure that such distribution occurs strictly in accordance with the Allocation Formula Notices ARTICLE 10 - GENERAL Whether or not so stipulated herein, all notices, communication, requests and statements (the "Notice") required or permitted hereunder shall be in writing. Any Notice required or permitted hereunder shall be sent to the intended recipient at its address as follows: Town of Peace River PO Box 6600 Peace River, AB T8S 1S4 Attention: Chief Administrative Officer Fax: (780) (ii) Municipal District of Peace No. 135 PO Box 34 Berwyn, AB T0H 0E0 Attention: Chief Administrative Officer Fax: (780) (iii) County of Northern Lights PO Box 10 Manning, AB T0H 2MO Attention: Chief Administrative Officer

8 - 8 - Fax: (780) (iv) (v) (vi) Northern Sunrise County PO Bag 1300 Peace River, AB T8S 1Y9 Attention: Chief Administrative Officer Fax: (780) Town of Grimshaw PO Box 377 Grimshaw, AB T0H 1W0 Attention: Chief Administrative Officer Fax: (780) Peace River Regional Airport Society Attention: Chair Fax: or to such other address as each Party may from time to time direct in writing. Notice shall be served by one of the following means: (ii) (iii) by delivering it to the Party on whom it is to be served. Notice delivered in this manner shall be deemed received when actually delivered to such Party; if delivered to a corporate party, by delivering it to the address specified in during normal business hours. Notice delivered in this manner shall be deemed received when actually delivered; by fax or to the Party on whom it is to be served. Notice delivered in this manner shall be deemed received on the earlier of: if transmitted before 3:00 p.m. on a Business Day, on that Business Day; or if transmitted after 3:00 p.m. on a Business Day, on the next Business Day after the date of transmission; or (iv) by mailing via first class registered post, postage prepaid, to the party to whom it is served. Notice so served shall be deemed to be received five (5) days after the date it is postmarked. In the event of postal interruption, no notice sent by means of the postal system during or within seven (7) days prior to the commencement of such postal interruption or seven (7) days after the cessation of such postal interruption shall be deemed to have been received unless actually received Governing Law This Agreement shall be construed and governed by the laws of the Province of Alberta and the laws of Canada applicable therein and the parties irrevocably attorn to the exclusive jurisdiction of the Courts of the Province of Alberta Time of Essence

9 - 9 - Time shall be of the essence of this Agreement Preamble and Schedules The parties hereby confirm and ratify the matters contained and referred to in the Preamble to this Agreement and agree that same and the various schedule(s) hereto are expressly incorporated into and form part of this Agreement: 10.5 Headings Schedule A - Allocation Formula The headings, captions, paragraph numbers, sub-paragraph numbers, article numbers and indices appearing in this Agreement have been inserted as a matter of convenience and for reference only and in no way define, limit, construct or enlarge the scope or meaning of this Agreement or any provisions hereof Relationship Between Parties Nothing contained herein shall be deemed or construed by the parties nor by any third party, as creating the relationship of employer and employee, principal and agent, partnership, or of a joint venture between the parties, it being understood and agreed that none of the provisions contained herein nor any act of the parties shall be deemed to create any relationship between the parties other than an independent service agreement between the two parties at arm's length No Authority Except as may from time to time be expressly stated in writing by the one party, the other party has no authority to assume or create any obligation whatsoever, expressed or implied, on behalf of or in the name of the other party, nor to bind the other party in any manner whatsoever Further Assurances Each of the parties do hereby agree to do such things and execute such further documents, agreements and assurances as may be necessary or advisable from time to time in order to carry out the terms and conditions of this Agreement in accordance with their true intent Amendments This Agreement may not be altered or amended in any of its provisions, except where any such changes are reduced to writing and executed by the parties Waiver No consent or waiver, express or implied, by either party to or of any breach or default by the other party in the performance by the other party of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of obligations hereunder by such party hereunder. Failure on the part of either party to complain of any act or failure to act of the other party or to declare the other party in default, irrespective of how long such failure continues, shall not constitute a waiver by such party of its rights hereunder Counterparts This Agreement may be executed and delivered in any number of counterparts, by facsimile copy, by electronic or digital signature or by other written acknowledgement of consent and agreement to be legally bound by its terms.

10 Each counterpart when executed and delivered will be considered an original but all counterparts taken together constitute one and the same instrument Statutory Reference Any reference to a statute shall include and shall be deemed to be a reference to such statute and to the regulations made pursuant thereto and promulgated thereunder with all amendments made thereto and in force from time to time and any final judicial decisions interpreting the same, and to any statute or regulation that may be passed which has the effect of supplementing or superseding the statute so referred to or the regulations made pursuant thereto Unenforceability If any term, covenant or condition of this Agreement or the application thereof to any party or circumstances shall be invalid or unenforceable to any extent, the remainder of this Agreement or application of such term, covenant or condition to a party or circumstance other than those to which it is held invalid or unenforceable shall not be affected thereby and each remaining term, covenant or condition of this Agreement shall be valid and shall be enforceable to the fullest permitted by law Survival The parties acknowledge and agree that the provisions of this Agreement which, by their context, are meant to survive the termination or expiry of the Term shall survive the termination or expiry of the Term and shall not be merged therein or therewith Remedies Generally Mention in this Agreement of any particular remedy of a party in respect of a default by the other party does not preclude the first party from any other remedy in respect thereof, whether available at law or in equity or by statute or expressly provided for in this Agreement. No remedy shall be exclusive or dependent upon any other remedy, but a party may from time to time exercise any one of more of such remedies generally or in combination, such remedies being cumulative and not alternative Payment of Monies The parties acknowledge and agree that any payment of monies required to be made hereunder shall be made in Canadian funds and that any tender of monies or documents hereunder may be made upon the solicitors acting for the party upon whom the tender is desired and it shall be sufficient that a negotiable bank draft or solicitor s trust cheque is tendered instead of cash Singular, Plural and Gender Wherever the singular, plural, masculine, feminine or neuter is used throughout this Agreement the same shall be construed as meaning the singular, plural, masculine, feminine, neuter, body politic or body corporate where the fact or context so requires and the provisions hereof Binding Effect This Agreement shall enure to the benefit of and be binding upon the successors and permitted assigns of each of the parties Assignment Neither party shall assign its interest in this Agreement, or any part hereof, in any manner whatsoever without having first received written consent from the other parties, such consent which may be arbitrarily withheld.

11 Requests for Consent Each party shall provide any decision with regard to a request for consent in a timely manner Construction This Agreement shall be interpreted according to its fair construction and shall not be construed as against any party hereto. IN WITNESS WHEREOF the parties have hereunto executed this Agreement under their respective corporate seals and by the hands of their proper officers duly authorized in that regard effective as of the day and year first above written notwithstanding the actual date or dates of execution hereof. TOWN OF PEACE RIVER MUNICIPAL DISTRICT OF PEACE NO. 135 COUNTY OF NORTHERN LIGHTS NORTHERN SUNRISE COUNTY TOWN OF GRIMSHAW PEACE RIVER REGIONAL AIRPORT SOCIETY

12 SCHEDULE "A" ALLOCATION FORMULA Municipality Percentage of Allocation Town of Peace River 40.84% Town of Grimshaw 5.00% Northern Sunrise County 27.50% County of Northern Lights 21.66% Municipal District of Peace No %

13 SCHEDULE "B" DISPUTE RESOLUTION PROCEDURE 1. Definitions In this Schedule, in addition to terms defined elsewhere in the Membership Agreement, the following words and phrases have the following meanings: (d) (e) (f) "Arbitrator" means the person appointed to act as such to resolve any Budget Dispute; "Arbitration" means a process whereby each of the Municipalities, with or without legal counsel, agrees to jointly engage and meet with an Arbitrator who will render a binding decision in respect of any Budget Disputes; "Budget Dispute" means a budgetary dispute between the Municipalities whereby they are unable to agree upon the passage of a budget for the Society; "Disclosed Information" means the information disclosed by a Municipality for the purpose of settlement or Arbitration; "Municipalities" means all of Peace River, MD of Peace, Northern Lights, NSC and Grimshaw and "Municipality" means any one of them; and "Representative" means an individual who has no direct operational responsibility for the matters comprising the Budget Dispute, who holds a senior position with a Municipality and who has full authority to settle a Budget Dispute. 2. Principles of Dispute Resolution The Municipalities acknowledge and agree that: (d) (e) in any business relationship a difference of opinion or interpretation or a divergence of interest may arise; the Municipalities are committed to resolving any disputes in a non-adversarial, informal and cost efficient manner; the following process shall apply in respect of Budget Disputes which are either referred to, or are required by the terms of the Membership Agreement to be resolved in accordance with this Schedule; the Municipalities shall make all reasonable efforts to resolve all Budget Disputes by negotiation and agree to provide, without prejudice, open and timely disclosure of relevant facts, information and documents to facilitate these negotiations as further contemplated within this Schedule; and although they would normally try to resolve all other disputes by first negotiating with each other and then proceeding to non-binding mediation, due to the critical time importance of resolving Budget Disputes, the Municipalities agree to resolve the Budget Dispute through arbitration. 3. Arbitration If a budget is not passed by the Municipalities in accordance with Section Mediation fails to resolve the Budget Dispute, the Budget Dispute shall be submitted to binding Arbitration. Any of the Municipalities may provide the other Municipalities with written notice ("Arbitration Notice") specifying:

14 (ii) the subject matters remaining in Budget Dispute and the details of the matters in Budget Dispute that are to be arbitrated; and the nomination of an individual to act as the Arbitrator. (d) (e) (f) (g) Subject to agreement of the Municipalities to resolve any disputed items by Arbitration as contemplated above the Municipalities shall, within 14 days of the Arbitration Notice, jointly nominate or agree upon an Arbitrator. The Arbitrator shall conduct the Arbitration in accordance with the commercial arbitration rules (the "Rules") established from time to time by the ADR Institute of Canada Inc., unless the Municipalities agree to modify the same pursuant to any arbitration agreement. The Arbitration Act (Alberta), as amended, shall apply to all Arbitrations but if there is a conflict between the Rules and the provisions of said Act, the Rules shall prevail. Notwithstanding the foregoing, any such Arbitration shall be conducted in the English language. The Arbitrator shall proceed to hear and render a written decision concerning any Budget Dispute within 14 days. The Arbitrator does not have the right to award punitive, consequential or other exemplary damages. The Arbitrator s decision is final and binding but is subject to appeal or review by any court of proper jurisdiction only with respect to an allegation of fraud. The Arbitrator s decision respecting the Budget Dispute shall be final and binding upon the Municipalities and the judgment of the Arbitrator shall be deemed to be the budget for the purposes of Section 4.1 of this hereof Agreement. 4. Participation The Municipalities and their Representatives will participate in good faith in the Arbitration process and provide such assistance and Disclosed Information as may be reasonably necessary. 5. Location The place for Arbitration shall be within the Town of Peace River, or such other location as the Municipalities may agree. 6. Selection of Arbitrator Without restricting any of the foregoing, if the Municipalities are unable to agree upon the appointment of a single Arbitrator within 10 days after receipt of the Arbitration Notice, any of the Municipalities may request that a single Arbitrator of suitable training, experience and independence, and who in respect of the subject matter of the Budget Dispute has a reasonable practical understanding, be recommended for appointment by the executive director or other individual fulfilling that role for the ADR Institute of Canada, Inc. The executive director shall be requested to make this determination within 5 days of receipt of the request. 7. Costs The Municipalities shall bear their respective costs incurred in connection with the Arbitration except that the Municipalities shall equally share the fees and expenses of the Arbitrator and the cost of the facilities required for Arbitration.

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