10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-K

(Mark One)
þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended June 30, 2009
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from          to

COMMISSION FILE NUMBER: 000-27577

HARRIS INTERACTIVE INC.

(Exact Name of Registrant as Specified in its Charter)

DELAWARE	16-1538028
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
60 Corporate Woods, Rochester, New York (Address of principal executive offices)	14623 (zip code)

Registrant’s telephone number, including area code:

(585) 272-8400

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
Common Stock, $0.001 par value per share	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act:

NONE

INDICATE BY CHECK MARK IF THE REGISTRANT IS A WELL-KNOWN SEASONED ISSUER, as defined in Rule 405 of the Securities Act.  Yes o     No þ

INDICATE BY CHECK MARK IF THE REGISTRANT IS NOT REQUIRED TO FILE REPORTS pursuant to Section 13 or Section 15(d) of the Act.  Yes o     No þ

INDICATE BY CHECK MARK WHETHER THE REGISTRANT:  (1) HAS FILED ALL REPORTS required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ     No o

INDICATE BY CHECK MARK WHETHER THE REGISTRANT HAS SUBMITTED ELECTRONICALLY AND POSTED ON ITS CORPORATE WEB SITE, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes o     No o

INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  þ

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A LARGE ACCELERATED FILER, AN ACCELERATED FILER, A NON-ACCELERATED FILER, OR A SMALLER REPORTING COMPANY. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o	Accelerated filer o	Non-accelerated filer o	Smaller reporting company þ
	(Do not check if a smaller reporting company)

INDICATE BY CHECK MARK WHETHER REGISTRANT IS A SHELL COMPANY (as defined in Rule 12b-2 of the Act).  Yes o     No þ

The aggregate market value of voting and non-voting common equity securities held by non-affiliates of the registrant, computed by reference to the closing price as of the last business day of the registrant’s most recently completed second fiscal quarter, December 31, 2008, was $34,366,401.

On August 31, 2009, 53,950,118 shares of the Registrant’s Common Stock, $.001 par value, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

The information required by Part III of this Report, to the extent not set forth herein, is incorporated by reference from the Registrant’s definitive proxy statement relating to the annual meeting of stockholders to be held on October 27, 2009, which definitive proxy statement will be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Report relates.

HARRIS INTERACTIVE INC.

FORM 10-K

FOR THE FISCAL YEAR ENDED JUNE 30, 2009

INDEX

		Page
Part I:
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995			3
Item 1:	Business		3
Item 1A:	Risk Factors		12
Item 1B:	Unresolved Staff Comments		18
Item 2:	Properties		18
Item 3:	Legal Proceedings		19
Item 4:	Submission of Matters to a Vote of Security Holders		19
Part II:
Item 5:	Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		20
Item 6:	Selected Financial Data		22
Item 7:	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23
Item 7A:	Quantitative and Qualitative Disclosures About Market Risk		43
Item 8:	Financial Statements and Supplementary Data		45
Item 9:	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		92
Item 9A:	Controls and Procedures		92
Item 9B:	Other Information		93
Part III:
Item 10:	Directors, Executive Officers and Corporate Governance		93
Item 11:	Executive Compensation		93
Item 12:	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		94
Item 13:	Certain Relationships and Related Transactions, and Director Independence		94
Item 14:	Principal Accountant Fees and Services		94
Part IV:
Item 15:	Exhibits and Financial Statement Schedules		94
Signatures			96
EX-10.1.23
EX-10.4.7
EX-10.4.8
EX-10.4.15
EX-10.4.28
EX-10.4.36
EX-10.6.18
EX-10.6.27
EX-10.6.28
EX-10.6.29
EX-21
EX-23
EX-31.1
EX-31.2
EX-32.1
EX-32.2

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PART I

“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995

The discussion in this Form 10-K contains forward-looking statements that involve risks and uncertainties. The statements contained in this Form 10-K that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including statements regarding expectations, beliefs, plans, objectives, intentions or strategies regarding the future. In some cases, you can identify forward-looking statements by terminology such as, “may”, “should”, “expects”, “plans”, “anticipates”, “feel”, “believes”, “estimates”, “predicts”, “potential”, “continue”, “consider”, “possibility”, or the negative of these terms or other comparable terminology. All forward-looking statements included in this document are based on the information available to Harris Interactive (the “Company”) on the date hereof, and the Company assumes no obligation to update any such forward-looking statement. Actual results could differ materially from the results discussed herein. Factors that might cause or contribute to such differences include but are not limited to, those discussed in the Risk Factors section of this Form 10-K and as set forth in other reports or documents the Company files from time to time with the Securities and Exchange Commission (the “SEC”). Risks and uncertainties also include the continued volatility of the global macroeconomic environment and its impact on the Company and its clients, the Company’s ability to sustain and grow its revenue base, the Company’s ability to maintain and improve cost efficient operations, the impact of reorganization and restructuring and related charges, quarterly variations in financial results, actions of competitors, and our ability to develop and maintain products and services attractive to the market.

Item 1.   Business

References herein to “we,” “our”, “us”, “its”, the “Company” or “Harris Interactive” refer to Harris Interactive Inc. and its subsidiaries, unless the context specifically requires otherwise. Harris Interactive^® and The Harris Poll^® are U.S. registered trademarks of Harris Interactive Inc. This Form 10-K may also include other trademarks, trade names and service marks of Harris Interactive and of other parties.

Corporate Overview

Harris Interactive was founded in 1975 in upstate New York as the Gordon S. Black Corporation, however, its roots date back to the founding of Louis Harris and Associates in New York City in 1956. Today, Harris Interactive is an international, full-service, consultative market research firm widely known for The Harris Poll (one of the world’s longest-running, independent opinion polls) and for pioneering online market research methods. Harris Interactive serves clients worldwide through its offices in North America, Europe and Asia and through a global network of independent market research firms.

Our corporate headquarters are located in Rochester, New York. We plan to move our corporate headquarters to 161 Sixth Avenue, New York, New York, effective September 15, 2009, where we have an office under an operating lease that expires in April 2012. Our fiscal year ends June 30th.

Mergers, Acquisitions and Sale of Business

The Gordon S. Black Corporation was founded in 1975 as a New York corporation. It formed and became part of the Delaware corporation now known as Harris Interactive in 1997. Since that time, our acquisitions have included:

•  February 1996 — all of the stock of Louis Harris and Associates, Inc., headquartered in New York,

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•  February 2001 — the custom research division of Yankelovich Partners, Inc., headquartered in Norwalk, Connecticut,

•  August 2001 — all of the capital stock of Market Research Solutions Limited, a privately-owned U.K. company headquartered in Oxford, England,

•  September 2001 — all of the capital stock of M&A Create Limited, a privately-owned company headquartered in Tokyo, Japan,

•  November 2001 — all of the capital stock of Total Research Corporation, a Delaware corporation headquartered in Princeton, New Jersey,

•  March 2004 — all of the capital stock of Novatris, S.A. (“Novatris”), a share corporation organized and existing under the laws of France,

•  September 2004 — all of the capital stock of Wirthlin Worldwide, Inc. (“Wirthlin”), a privately-held California corporation headquartered in Reston, Virginia,

•  April 2007 — all of the capital stock of MediaTransfer AG Netresearch & Consulting (“MediaTransfer”), a privately-held German stock corporation headquartered in Hamburg, Germany,

•  August 2007 — all of the capital stock of Decima Research Inc. (“Decima”), a corporation incorporated in Ontario, Canada, and

•  August 2007 — all of the capital stock of Marketshare Limited, a company incorporated under the laws of Hong Kong, and Marketshare Pte Ltd, a company incorporated under the laws of Singapore (collectively, “Marketshare”).

In May 2005, we completed the sale of our Japanese subsidiaries, M&A Create Limited, Adams Communications Limited and Harris Interactive Japan, K.K., in a management buy-out. In August 2007, we sold our “Rent and Recruit” business, which was engaged primarily in providing facilities for and conducting focus group interviews.

Business Overview

Harris Interactive is a professional services firm that serves clients in many industries and many countries. We provide full service market research and polling services which include ad-hoc or customized qualitative and quantitative research, service bureau research (conducted for other market research firms) and long-term tracking studies.

We serve clients in numerous industries through the following research groups:

•  Business and Industrial, which includes the automotive, transportation, travel, tourism, energy and professional services sectors,

•  Consumer Goods, which includes the restaurant and retail sectors,

•  Financial Services,

•  Healthcare,

•  Public Affairs and Policy, which includes public relations and associations, and

•  Technology, Media and Telecommunications.

In addition, we maintain strategic research groups that collaborate with our industry research teams to deliver consultative solutions in the following areas:

•  Market Assessment,

•  Product Development,

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•  Brand and Communications,

•  Reputation Management,

•  Stakeholder Relationships, and

•  Youth and Education.

We conduct a significant portion of our market research using online data collection. We also conduct computer-assisted telephone interviewing in telephone data collection centers in the United Kingdom, Canada, Hong Kong and Singapore. In addition to these dedicated facilities, we outsource telephone data collection and survey programming to contracted sources in a number of countries including India and Costa Rica.

Our Products and Services

Custom Research

We conduct many types of custom research including customer satisfaction surveys, market share studies, new product introduction studies, brand recognition studies, reputation studies, ad concept testing and more. A custom research project has three distinct phases:

•  Survey Design — Initial meetings are conducted with the client to clearly define the objectives and reasons for the study to ensure that the final data collected will meet the client’s needs. Based on the client’s requirements, we then determine the proper data collection process (such as a mail, telephone or online survey, focus group meetings, personal interviews, or any combination thereof), sampling scheme (the demographics and number of people to be surveyed) and survey design or focus group protocol.

•  Data Collection — Field data collection is conducted through computer-aided online or telephone interviewing, by mail or in person, by holding focus group meetings, or any combination of the above. Multiple quality assurance processes are employed to ensure that the survey data are accurate and that the correct number and type of interviews have been completed.

•  Weighting, Analysis and Reporting — We review the collected data for sufficiency and completeness, weight the data accordingly, and then analyze by desired demographic, business or industry characteristics. A comprehensive report that typically includes recommendations is then prepared and delivered to the client.

Our sample design and questionnaire development techniques help ensure that complete and accurate information is collected, and that these data will satisfy the specific inquiries of our clients. We have developed in-depth data collection techniques to enhance the integrity and reliability of our sample database. Our survey methodology is intended to ensure that responses are derived from the appropriate decision-makers in each category. As a result, we have a solid foundation for delivering the data that meets our clients’ needs.

Tracking Study Research

We apply extensive expertise to the design, execution and maintenance of custom, online tracking studies for clients in a broad range of industries and around the globe. Considered by many to be a vital part of any comprehensive research program, tracking studies regularly ask identical questions to similar demographic groups within a constant interval (once a month, once a quarter, etc.) to feed business decision-makers with dynamic data and intelligence that enables them to:

•  Measure, sustain and improve customer loyalty,

•  Gather market and customer intelligence relative to the brand and category,

•  Detect emerging market trends and/or potential competitive threats,

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•  Assess the impact of marketing on customer behaviors and attitudes, and

•  Identify opportunities for growth.

Service Bureau Research

The Harris Interactive Service Bureau (“HISB”) conducts data collection for other market research firms that do not have internal market research capabilities.

Research and Development

We have not incurred expenditures for the three fiscal years ended June 30, 2009 that would be classified as research and development as defined by accounting principles generally accepted in the United States of America under Statement of Financial Accounting Standards (“SFAS”) No. 2, Accounting for Research and Development Costs.

Our Intellectual Property and Other Proprietary Rights

We believe that the Harris brand and its associated intellectual property provide us with many competitive advantages. To protect our brand and our intellectual property, we rely on a combination of patent, copyright, trademark and trade-secret laws, as well as confidentiality, non-disclosure, non-compete and license agreements, and clearly defined standard terms and conditions in our sales contracts.

We currently have patents and patent applications pending for:

•  A system to conduct research via “build your own” product/pricing configurations over a network, and

•  Shelf Impact^(SM) — a system for evaluating the impact of package design and shelf placement for store shelf products using extremely short duration image exposure.

Additionally, we have registered trademarks for many of our products and services in North America, Europe and Asia, and will continue to protect our intellectual property through those means.

We have licensed in the past, and expect to license in the future, certain proprietary rights, such as trademarks or copyrighted material, to third parties. While we attempt to ensure that the quality of our brand is maintained by these licenses, licensees may take actions that might harm the value of our proprietary rights or reputation.

Seasonality

Being project-based, our business has historically exhibited moderate seasonality. Revenue generally tends to ramp upward during the fiscal year, with Q1 (ending September 30) generating the lowest revenue. Fiscal Q2 (ending December 31) generally yields a sequential increase in revenue. Fiscal Q3 (ending March 31) is approximately flat with or slightly less than Q2. Fiscal Q4 (ending June 30) revenue typically yields the highest revenue of the year. As a result of the seasonality noted, we manage our business based on our annual business cycle. Total consolidated revenue from continuing operations, by quarter, for the fiscal years ended June 30, 2008 and 2009 is shown in Note 23, “Unaudited Quarterly Results of Operations”, to our consolidated financial statements contained in this Form 10-K.

The moderate historical seasonality described above is not necessarily indicative of quarterly revenue trends which may occur in the future.

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Our Clients

At June 30, 2009, we had approximately 1,800 clients, compared with approximately 1,900 at June 30, 2008. In fiscal 2009 and 2008, no single client accounted for more than 10% of our consolidated revenue.

Our Competition

We compete with numerous market research firms, as well as corporations and individuals that perform market research studies on an isolated basis, many of which have market shares or financial and marketing resources larger than our own. Our competitors include, but are not limited to, Synovate (owned by Aegis Group plc), Arbitron Inc., GfK AG, IMS Health, Inc., Intage Inc., Ipsos SA, National Research Corp., TNS and Millward Brown (owned by WPP Group plc), and YouGov plc.

We believe we have a number of competitive advantages, including:

•  Our Highly Skilled Employees — many of whom are recognized by their peers as leaders in the field of market research, or in the particular vertical markets in which they specialize.

•  Our Strong Brand — we believe that Harris Interactive and The Harris Poll are two of the best known and most trusted names for U.S. market research and public opinion polling today. We have now expanded The Harris Poll into the United Kingdom and throughout Europe, and expect to continue our relationships with The Financial Times (London), International Herald Tribune and France 24 (Paris), in order to raise awareness of the Harris Interactive brand on a global scale.

•  Our Online Panel — our online panel consists of millions of individuals from around the world who have voluntarily agreed to participate in our various online research studies. This large and diverse panel enables us to:

•  accurately project results to large segments of the population, such as “all U.S. voters” or “all British adults”,

•  conduct a broad range of studies across a wide set of industries,

•  rapidly survey very large numbers of the general population, and

•  accurately survey certain low-incidence, hard-to-find subjects.

•  Our Specialty Sub-Panels — we have developed numerous specialty sub-panels of hard-to-find respondents, including: Affluent, Chronic Illness, Mothers and Expectant Mothers, Physicians, Pet Companion, Technology Decision-Makers and Youth. Our clients value our ability to survey these hard to find subjects. Many of our clients have asked us to develop specialty sub-panels exclusively for their use.

•  Our Global Enterprise Solutions Portfolio — A comprehensive tool-box of research techniques, methodologies and models that can be applied by marketing experts to help develop strategy, implement tactics and assess their impact in the marketplace. These tools can also be used to analyze markets, develop new products and services, create and/or measure brand positioning and awareness and measure and/or improve customer loyalty.

•  Our Technology Enablers — Our technology enablers include:

•  Exposition tools, including Vision Trace and Online Shelf Test. Vision Trace is based on the scientifically validated Focus Window method and allows us to record and evaluate the flow of attention. Online Shelf Test allows for the simulation of a shopping situation and measures related aspects including attention/consideration, decision-making and influence of marketing/communication.

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•  A global synchronized research platform, known as GlobalSynch, which integrates data collected via multiple modes into one database.

•  A text mining solution, known as Harris Interactive Text Analytics, which integrates the leading text mining technology from Clarabridge and proprietary advanced analytics to map market trends. The solution is intended for use by any company or organization that wants to integrate the many sources of information available about its market to optimize investment in market research dollars, and produce better trend forecasting.

•  The ViewPort^SM Pro reporting tool, which offers a complete suite of web-based, decision-support tools providing access to critical business intelligence in real time. ViewPort Pro simplifies information retrieval for CEOs, research analysts, account managers, and other stakeholders with its intuitive interface. The set of report tools provides personalized templates and fully customizable reports.

•  Our Dedication to Customer Satisfaction — which has helped us to retain our clients and continually improve the quality of services that we deliver. We evaluate all of our professional research staff on customer satisfaction scores, and their bonus compensation is also tied in part to those customer satisfaction levels. At June 30, 2009, our worldwide overall satisfaction rating stood at 8.9, compared with 8.3 at June 30, 2008, both on a ten point scale. Maintaining high levels of customer satisfaction helps us to:

•  identify and rapidly respond to changing client needs,

•  increase the loyalty of our clients and generate greater lifetime value from them, and

•  improve our margins by dampening price sensitivity.

Financial Information about Geographic Areas

We are comprised principally of operations in North America, Europe and Asia. Non-U.S. market research operations are located in the United Kingdom, Canada, France, Germany, Hong Kong, Singapore and China. We operate these non-U.S. businesses on a basis consistent with our U.S. operations.

Our business model for offering custom market research is consistent across the geographic regions in which we operate. Geographic management facilitates local execution of our global strategies. We maintain global leaders with responsibility across all geographic regions for the majority of our critical business processes, and the most significant performance evaluations and resources allocations made by our chief operating decision-maker are made on a global basis. Accordingly, we have concluded that we have one reportable segment.

We have prepared the financial results for geographic information on a basis that is consistent with the manner in which management internally disaggregates information to assist in making internal operating decisions. We have allocated common expenses among these geographic regions differently than we would for stand-alone information prepared in accordance with accounting principles generally accepted in the United States of America. All intercompany sales and transactions have been eliminated upon consolidation. Geographic operating income (loss) may not be consistent with measures used by other companies.

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Geographic information from continuing operations for the fiscal years ended June 30 was as follows (amounts in thousands):

	2009			2008			2007
Revenue from services
United States	$	112,821		$	152,894		$	159,843
United Kingdom		32,454			43,771			43,655
Canada		19,939			24,628			—
Other European countries		14,536			14,910			8,305
Asia		4,584			2,520			—
Total revenue from services	$	184,334		$	238,723		$	211,803
Operating income (loss)(1)(2)
United States	$	(41,406	)	$	(54,492	)	$	9,802
United Kingdom		(3,431	)		(9,015	)		2,748
Canada		(5,539	)		(7,366	)		—
Other European countries		(5,048	)		(10,914	)		(14	)
Asia		(1,025	)		(2,784	)		(219	)
Total operating income (loss)	$	(56,449	)	$	(84,571	)	$	12,317
Long-lived assets
United States	$	4,879		$	6,733		$	7,298
Canada		1,693			2,858			—
United Kingdom		1,039			1,812			2,261
Other European countries		301			340			343
Asia		103			210			—
Total long-lived assets	$	8,015		$	11,953		$	9,902
Deferred tax assets (liabilities)
United States	$	—		$	18,218		$	17,064
Canada		(2,018	)		(3,191	)		—
United Kingdom		283			347			318
Other European countries		(512	)		(844	)		(859	)
Asia		—			—			—
Total deferred tax assets (liabilities)	$	(2,247	)	$	14,530		$	16,523

(1)	Operating loss for fiscal 2009 included a $40,250 goodwill impairment charge. The charge was allocated to our geographic locations, specifically, $28,888 to the United States, $3,315 to the United Kingdom, $2,435 to Canada, $4,873 to other European countries, and $739 to Asia.
(2)	Operating loss for fiscal 2008 included a $86,497 goodwill impairment charge. The charge was allocated to our geographic locations, specifically, $58,376 to the United States, $9,472 to the United Kingdom, $5,921 to Canada, $11,150 to other European countries, and $1,578 to Asia.

During fiscal 2009, 2008 and 2007, 61.2%, 64.0%, and 75.5%, respectively, of our total consolidated revenue was derived from our U.S. operations, and 38.8%, 36.0%, and 24.5%, respectively, of our total consolidated revenue was derived from our non-U.S. operations.

See “Item 1A. Risk Factors” below for a description of certain risks attendant to our non-U.S. operations.

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Backlog

At June 30, 2009, we had a revenue backlog from continuing operations of approximately $48,811, as compared to a backlog of approximately $66,793 from continuing operations at June 30, 2008. We estimate that substantially all of the backlog at June 30, 2009 will be recognized as revenue from services during the fiscal year ending June 30, 2010, based on our experience from prior years.

Employees

At June 30, 2009, we employed a total of 848 full-time individuals on a worldwide basis, 462 of whom were employed in the United States. In addition, we employed 216 part-time and hourly individuals on a worldwide basis for data gathering and processing activities, 61 of whom were employed in the United States. Casual employees of our operations outside of the United States are not included in the headcount numbers provided herein.

None of our employees is represented by a collective bargaining agreement. We have not experienced any work stoppages. We consider our relationship with our employees to be good.

Executive Officers of Harris Interactive

The following table sets forth the name, age and position of each of the persons who were serving as our executive officers as of August 31, 2009. These individuals have been appointed by and are serving at the pleasure of our board of directors.

Name	Age		Position
Kimberly Till		53	President and Chief Executive Officer
Robert J. Cox		43	Executive Vice President, Chief Financial Officer and Treasurer
Frank E. Forkin		47	President, North America Client Services
Patti B. Hoffman		60	Interim Head of Human Resources
Enzo Micali		50	Global Executive Vice President, Technology and Operations
Eric W. Narowski		40	Principal Accounting Officer and Senior Vice President, Global Controller
Robert Salvoni		44	Managing Director, Europe
George H. Terhanian, PhD		45	President, Global Solutions

Kimberly Till is our President and Chief Executive Officer, positions she has held since October 2008. Ms. Till has been a director of the Company since October 2008. Prior to joining us, Ms. Till served as President and Chief Executive Officer, TNS North America (custom business) from May 2006 to March 2008. From November 2003 to March 2006, Ms. Till served as Vice President, Worldwide Media and Entertainment Group, Communications Sector, Microsoft Corporation. Prior to joining Microsoft, from 2000 to October 2003, Ms. Till served at AOL Time Warner America Online, Inc., first as Senior Vice President of International Operations and General Manager of AOL International, then as senior strategic financial advisor at the Warner Music Group. In 1990, Ms. Till was selected for the prestigious White House Fellowship, where she served as a Special Assistant to the former U.S. Trade Representative and Secretary of Agriculture and to the Director of the FBI.

Robert J. Cox is our Executive Vice President, Chief Financial Officer and Treasurer, positions he has held since June 2009. Prior to joining us, Mr. Cox served as Senior Vice President, Chief Financial Officer and Treasurer at DealerTrack Holdings, Inc., a publicly traded provider of on-demand software and data solutions for the automotive retail industry, from November 2004 to March 2009. He joined DealerTrack in June 2001 and held the top finance position at all times during his tenure with the company. Prior to joining DealerTrack, Mr. Cox held senior financial positions at Triton

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International, Inc. and Green Stamp America, Inc. between 1991 and 2001. Mr. Cox began his career in the audit practice at KPMG LLP in 1987 and is a New York State Certified Public Accountant.

Frank E. Forkin is our President, North America Client Services, a position he has held since June 2009. From February to June 2009, Mr. Forkin served as Vice President of Strategy and Consumer Insights Management for Dominos Pizza. Prior to joining Dominos, Mr. Forkin was with J.D. Power and Associates for more than ten years and served there in progressively senior roles, most recently as Vice President and General Manager. Prior to joining J.D. Power and Associates, Mr. Forkin was Senior Vice President of the RDA Group, where his focus was business development, research, strategic design and consulting.

Patti B. Hoffman is our Interim Head of Human Resources, a position she has held since May 2009. Prior to joining us, Ms. Hoffman worked for six years as an independent human resources consultant providing her clients with the design, development and implementation of human resources programs relating to compensation, including flexible pay programs, benefits, career progression plans and contingency planning. Prior to her consulting role, Ms. Hoffman spent seven years with Total Research Corporation serving in progressively senior roles, most recently as Chief Administrative Officer.

Enzo Micali is our Global Executive Vice President, Technology and Operations, a position he has held since March 2009. Prior to joining us, Mr. Micali served as the Chief Information Officer and Executive Vice President of Operations for TNS North America (custom business), a position he assumed in January 2007. Prior to joining TNS, Mr. Micali served as Chief Information Officer and Senior Vice President for 1-800-FLOWERS.COM from 2000 through 2006, where he was responsible for overseeing all technology plans and programs for the online retailer and its eight subsidiaries. Mr. Micali also has served as Chief Technology Officer for Inslogic, a business-to-business software provider supporting financial institutions and internet portals serving the insurance industry, and has held key IT roles at Chase Manhattan Bank, PricewaterhouseCoopers Consulting, Deloitte & Touche, and Chemical Bank.

Eric W. Narowski is our Principal Accounting Officer and Senior Vice President, Global Controller, positions he has held since February 2006 and October 2007, respectively. From January 2000 to October 2007, Mr. Narowski served as our Vice President, Corporate Controller. Mr. Narowski joined us in July 1997 as our Controller, and is a New York State Certified Public Accountant.

Robert Salvoni is our Managing Director, Europe, a position he has held since May 2009. Prior to joining us, Mr. Salvoni served as Managing Director at Iris Accountancy Practice Solutions from 2007 to 2009. Prior to 2007, Mr. Salvoni spent 15 years at British Telecom (BT) serving in progressively senior roles, running joint ventures and subsidiary companies, and most recently as Sales Director for BT Wholesale.

George H. Terhanian, Ph.D. is currently our President, Global Solutions, a position he has held since December 2008. Prior to serving as President, Global Solutions, Dr. Terhanian served as President of Harris Interactive Europe and Global Internet Research, from July 2003 and June 2002, respectively. Prior to joining us in 1996, Dr. Terhanian taught in elementary and secondary schools in the United States. He also has served an appointment as an American Educational Research Association Fellow at the National Center for Educational Statistics.

Available Information

Information about our products and services, shareholder information, press releases and SEC filings can be found on our website at www.harrisinteractive.com. Through our website, we make available free of charge the documents and reports we file with the SEC, including our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, as soon as reasonably practicable after we electronically file such material with, or

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furnish it to, the SEC. Information on our website (or the websites of our subsidiaries) does not constitute part of this Report on Form 10-K.

The public may also read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site at www.sec.gov, which contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

Item 1A.   Risk Factors

Factors That May Affect Future Performance.

We operate in a very competitive and rapidly changing environment that involves numerous risks and uncertainties, some of which are beyond our control. In addition, we and our clients are affected by global economic conditions. The following section discusses many of these risks and uncertainties, but is not intended to be all-inclusive.

Risks Related to Our Business

Our business is vulnerable to fluctuations in general economic conditions.

Our business tends to be adversely affected by slow or depressed business conditions in the market as a whole. Many of our clients treat all or a portion of their market research expenditures as discretionary. As global macroeconomic conditions decline and our clients seek to control variable costs, new bookings tend to slow, existing bookings become increasingly vulnerable to subsequent cancellations and delays, and our sales backlog may convert to revenue more slowly than it has historically. A portion of our business involves longer-term tracking studies, which are often renewable on an annual basis. Non-renewal of a large tracking study can have an immediate disproportionate impact on our revenues, and we may have a lag time in adjusting our cost structure to reflect the effects of the non-renewal. Any of the above factors may result in a material adverse impact to our growth, revenues, and earnings.

Failure to maintain our brand reputation and recognition could impair our ability to remain competitive.

We believe that maintaining our good brand reputation and recognition is critical to attracting and expanding our current client base as well as attracting and retaining qualified employees. If our reputation and name are damaged through our participation in surveys involving controversial topics or if the results of our surveys are inaccurate or are misused or used out of context by one of our clients, we may become less competitive or lose market share.

If we are unable to maintain adequate capacity and demographic composition of our existing online panel, our business, financial condition and results of operations may be adversely affected.

Our success is highly dependent on our ability to maintain sufficient capacity of our online panel and its specialty sub-panels. Our ability to do this may be harmed if we lose panel capacity or are unable to attract and maintain an adequate number of replacement panelists and specialty sub-panel members. There are currently no industry or other benchmarks for determining the optimal size and composition of an online respondent panel. Among other factors, panelist response rates vary with differing survey content, and the frequency with which panelists are willing to respond to survey invitations is variable. We constantly reassess our panel size and demographics as survey requests are made and, based upon availability of existing panelists to fulfill project requests, determine our need to recruit additional panelists. We are not always able to accommodate client requests to survey low-incidence, limited populations with specific demographic characteristics. If our need to recruit

12

panelists or specialty sub-panel members increases significantly, our operating costs will rise. Further, our business will be adversely affected if we do not achieve sufficient response rates with our existing panelists or our panel narrows and we are unable to spend the funds necessary to recruit additional panelists.

We face competitive pressures within our industry and must continuously replace completed work with new projects.

The market research industry includes many competitors, some of which are much larger than we are, have a greater global presence, and/or have specialized products and services we do not offer. There can be no assurance that we will be able to successfully compete against current and future competitors and our failure to do so could result in loss of market share, diminished value in our products and services, reduced pricing and increased marketing expenditures. Furthermore, we may not be successful if we cannot compete effectively on quality of our services, timely delivery of information, customer service, and the ability to offer products to meet changing market needs or prices.

No one client accounts for more than 10% of our revenues and most of our revenues are derived on a project by project basis. We must continuously replace completed work with new projects from both existing and new clients, and these competitive pressures may make it more difficult for us to do so and to sustain and grow our revenues.

Our outstanding debt obligations could impact our financial condition or future operating results.

At June 30, 2009, we had $22.5 million outstanding under our Credit Agreement, which provides for amortizing term loans with quarterly payments and, subject to certain conditions, the availability of a maximum amount of $5.0 million under a revolving credit facility.

The affirmative, negative and financial covenants of our Credit Agreement could limit our future financial flexibility and could adversely impact our ability to conduct our business. Additionally, a failure to comply with these covenants could result in acceleration of all amounts outstanding under our Credit Agreement, which would materially impact our financial condition unless accommodations could be negotiated with our lenders. No assurance can be given that we would be successful in doing so in this current financial climate, or that any accommodations that we were able to negotiate would be on terms as favorable as those presently contained in our Credit Agreement.

The associated debt service costs of the borrowing arrangement under our Credit Agreement will continue to be reflected in operating results. The outstanding debt may limit the amount of cash or additional credit available to us, which could restrain our ability to expand or enhance products and services, respond to competitive pressures, or pursue future business opportunities requiring substantial investments of additional capital.

A breach of our Internet security measures, security concerns, or liability arising from the use of the personal information of our Internet panel, could adversely affect our business.

A failure in our Internet security measures could result in the misappropriation of private data. As a result, we may be required to expend capital and other resources to protect against the threat of such security breaches or to alleviate problems caused by such breaches, which could have a material adverse effect on our business, financial condition and results of operations.

Internet security concerns could cause some online panelists to reduce their participation levels, provide inaccurate responses or end their membership in our Internet panel. This could harm our credibility with our current clients. If our clients become dissatisfied, they may stop using our products and services. In addition, dissatisfied and lost clients could damage our reputation. A loss of online

13

panelists or a loss of clients would hurt our efforts to generate increased revenues and impair our ability to attract potential clients.

We could be subject to liability claims by our online panelists for any misuse of the demographic personal information. These claims could result in costly litigation. We could also incur additional costs and expenses if new regulations regarding the use of personal information are introduced or if our privacy practices are investigated by a governmental body.

We must continue to attract and retain highly skilled employees.

Our future success will depend, in part, on our ability to continue to attract, retain and motivate highly skilled technical, managerial, marketing, sales and client support personnel. Project managers with industry expertise are important to our ability to retain and expand our business. Intense competition for these personnel exists, and we may be unable to attract, integrate or retain the proper numbers of sufficiently qualified personnel that our business plan assumes. In the past, we have from time to time experienced difficulty hiring and retaining qualified employees. There are few, if any, educational institutions that provide specialized training related to market research. Therefore, employees must be recruited in competition with other industries. In the past, competition for highly skilled employees has resulted in additional costs for recruitment, training, compensation and relocation or the provision of remote access to our facilities. We may continue in the future to experience difficulty in hiring and retaining employees with appropriate qualifications. To the extent that we are unable to hire and retain skilled employees in the future, our business, financial condition and results of operations would likely suffer.

If our new senior management team is unsuccessful in rebuilding our business, it could have an adverse impact on our revenues, operations, results, or stock value.

During fiscal 2009, we rebuilt virtually our entire senior management team by recruiting talent from outside the Company and also by promoting from within. Our success will be dependent upon the ability of our new senior management team to gain proficiency in leading our Company, effectively implement our corporate strategy and initiatives, and develop key professional relationships. If our new senior management team is unable to achieve success in these areas, it could have an adverse impact on our revenues, operations, results or stock value.

We may require additional cash resources which may not be available on favorable terms or at all.

We believe that our existing cash balances, projected cash flow from operations, and the remaining borrowing capacity we have under our revolving credit facility will be sufficient for our expected short-term and foreseeable long-term operating needs.

We may, however, require additional cash resources due to unanticipated business conditions, to repay indebtedness or to pursue future business opportunities requiring substantial investments of additional capital. If our existing financial resources are insufficient to satisfy our requirements, we may seek additional borrowings. Prevailing credit market conditions may negatively affect debt availability and cost, and, as a result, financing may not be available in amounts or on terms acceptable to us, if at all. In addition, the incurrence of additional indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would further restrict our operations.

Our international operations expose us to a variety of operational risks which could negatively impact our future revenue and growth.

Our operating results are subject to the risks inherent in international business activities, including general political and economic conditions in each country, changes in market demand as a result of tariffs and other trade barriers, challenges in staffing and managing foreign operations, changes in

14

regulatory requirements, compliance with numerous foreign laws and regulations, differences between U.S. and foreign tax rates and laws, currency exchange fluctuations, problems in collecting accounts receivable and longer collection periods, issues related to repatriation of earnings of foreign subsidiaries, Internet access restrictions, protecting intellectual property rights in international jurisdictions, political instability, and anti-U.S. sentiment or terrorist activity against U.S. interests abroad. We have little or no control over these risks. For example, we have encountered more restrictive privacy laws in connection with our business operations in Europe, which have inhibited the growth of our European Internet panel. As we increase our global operations in the future, we may experience some or all of these risks, which may have a material adverse effect on our business, financial condition and results of operations.

In addition, we rely on off-shore providers in countries, such as India and Costa Rica, to provide certain of our programming services, as well as telephone and online data collection. Political or economic instability in countries where such support services are provided, or a significant increase in the costs of such services, could adversely affect our business. From time to time, laws and regulations are proposed in the jurisdictions where we operate that would restrict or limit the benefits of off-shore operations, and enactment of any such legal restrictions could harm our results of operations.

If we are unable to enforce and protect our intellectual property rights our competitive position may be harmed.

We rely on a combination of copyright, trademark, trade secret, confidentiality, non-compete and other contractual provisions to protect our intellectual property rights. Despite our efforts to protect our intellectual property rights, unauthorized third parties may obtain and use technology or other information that we regard as proprietary. Our intellectual property rights may not survive a legal challenge to their validity or provide significant protection for us. The laws of certain countries do not protect our proprietary rights to the same extent as the laws of the United States. Accordingly, we may not be able to protect our intellectual property in such countries against unauthorized third-party copying or use, which could adversely affect our competitive position.

We may be subject to liability for publishing or distributing content over the Internet.

We may be subject to claims relating to content that is published on or downloaded from our websites. We may also be subject to liability for content that is accessible from our website through links to other websites. For example, as part of our surveys panelists sometimes access, through our websites or linkages to our client’s or other third party websites, content provided by our clients, such as advertising copy, that may be incomplete or contain inaccuracies. We also recruit panelists to participate in research sponsored and hosted by our clients on the client’s website, and we cannot completely control breaches of privacy policies, warranties, or other claims that may be made by those third parties. We may be accused of sending bulk unsolicited email and have our email blocked by one or more Internet service providers and, therefore, our online data collection efforts may suffer.

Although we carry general and professional liability insurance, our insurance may not cover potential liability claims for publishing or distributing content over the Internet, or may not be adequate to cover all costs incurred in defense of potential claims or to indemnify us for all liability that may be imposed. In addition, any claims of this type, with or without merit, would result in the diversion of our financial resources and management personnel.

Any failure in the performance of our technology infrastructure or the Internet backbone could harm our business.

Any system delays or failures, including network, software or hardware failures, that cause an interruption in our ability to communicate with our Internet panel, collect research data, or protect

15

visual materials included in our surveys, could result in reduced revenue, impair our reputation, and have a material adverse effect on our business, financial condition and results of operations.

Our systems and operations are vulnerable to damage or interruption from fire, earthquake, flooding, power loss, telecommunications failure, break-ins and similar events. The redundancy of our systems may not be adequate, as we depend upon third-party suppliers to protect our systems and operations from the events described above. We have experienced technical difficulties and downtime of individual components of our systems in the past, and we believe that technical difficulties and downtime may occur from time to time in the future. The impact of technical difficulties and downtime may be severe. We have developed, however have not fully implemented, a formal disaster recovery plan, and our business interruption insurance may not adequately compensate us for any losses that may occur due to failures in our systems.

Major components of the Internet backbone itself could fail due to terrorist attack, war or natural disaster. Further, our servers could be the subject of cyber attacks or outages could be experienced with Internet service providers. Our business is particularly vulnerable to such occurrences because we not only would suffer the effects experienced by businesses in general, we would be unable to perform online surveys, which represent a significant portion of our business. Thus, we would have to find alternative means to conduct surveys or would be unable to effectively service the needs of many of our clients.

Risks Related to Our Common Stock

Our business may be harmed if we cannot maintain our listing on the Nasdaq Global Select Stock Market.

Variations in our operating results may cause our stock price to fluctuate. Our quarterly operating results have in the past, and may in the future, fluctuate significantly and we have and may continue to incur losses in any given quarter. Our future results of operations have and may again fall below the expectations of public market analysts and investors. If this happens, the price of our common stock would likely decline. Other factors, such as general market conditions and investor’s perceptions of our longer term prospects, also may cause fluctuations in the price of our common stock.

To maintain our listing on the Nasdaq Global Select Market we must satisfy certain minimum financial and other continued listing standards, including, among other requirements (amounts below are in thousands of U.S. Dollars, except for share and per share data):

•  minimum $10,000 stockholder’s equity,

•  minimum 750,000 publicly traded shares,

•  minimum $5,000 market value of publicly held shares,

•  $1.00 per share minimum bid price, and

•  two registered and active market makers.

Citing extraordinary market conditions, on October 16, 2008 and again on December 19, 2008, March 23, 2009 and July 13, 2009, Nasdaq suspended application of the requirements related to minimum market value of listed securities and minimum bid price. On August 3, 2009, the requirements were reinstated with a new measurement period commencing on that date.

Any failure to meet the market value requirement must continue for 10 consecutive days and may be cured within 30 days after notification by Nasdaq of non-compliance by meeting the standard for 10 consecutive business days. Any failure to meet the minimum bid price requirement must continue for 30 consecutive business days and may be cured within 180 days after notification by Nasdaq of non-compliance by meeting the standard for 10, or in Nasdaq’s discretion 20 or more, consecutive business days. If we fail to meet these requirements, we would have the option to apply to transfer our securities to the Nasdaq Capital Market, which would provide us with an additional 180 days to

16

meet the $1.00 minimum bid requirement. If we fail to meet the minimum bid requirement after that additional 180 days have elapsed, Nasdaq may provide written notification to us regarding the de-listing of our common stock. At that time, we would have the right to request a hearing to appeal the Nasdaq de-listing determination.

Since November 14, 2008, the bid price of our common stock has been below $1.00 per share. As of August 25, 2009, the bid price of our common stock was $0.82 per share and our approximate market value for listed securities was $44.2 million. There can be no assurance that we will meet the continued listing requirements for the Nasdaq Global Select Market, or that any appeal of a decision to de-list our common stock will be successful. If our common stock loses its status on the Nasdaq Global Select Market and we are not successful in obtaining a listing on the Nasdaq Capital Market, shares of our common stock would likely trade in the over-the-counter market bulletin board, commonly referred to as the “pink sheets.” If our stock were to trade on the over-the-counter market, selling our common stock could be more difficult because smaller quantities of shares would likely be bought and sold, transactions could be delayed, and security analysts’ coverage of us may be reduced. In addition, in the event our common stock is de-listed, broker-dealers have certain regulatory burdens imposed upon them, which may discourage broker-dealers from effecting transactions in our common stock, further limiting the liquidity of our common stock. These factors could have a material adverse effect on the trading price, liquidity, value and marketability of our common stock.

Our operating results may fluctuate from period to period and may not meet the expectations of securities analysts or investors or forward-looking statements we have made, which may cause the price of our common stock to decline.

Our quarterly and annual operating results may fluctuate in the future as a result of many factors, some of which are outside our control, including declines in general economic conditions or the budgets of our clients, changes in the demand for market research and polling products and services, currency fluctuations, the timing of client projects, and competition in the industry, and others which are partially within our control, including the amount of new business generated, effective management of the professional services aspects of our business, including utilization and realization rates, the mix of domestic and international business, and the timing of the development, introduction and marketing of new products and services. An inability to generate sufficient earnings and cash flow may impact our operating and other activities. The potential fluctuations in our operating results could cause period-to-period comparisons of operating results not to be meaningful and may provide an unreliable indication of future operating results. Furthermore, our operating results may not meet the expectations of securities analysts or investors in the future or forward-looking statements we have made. If this occurs, the price of our stock would likely decline.

Our stock price may be volatile, and you may not be able to resell shares of our common stock at or above the price you paid.

The trading prices of our common stock could be subject to significant fluctuations in response to, among other factors, variations in operating results, developments in the industries in which we do business, general economic conditions, general market conditions, changes in the nature and composition of our stockholder base, changes in securities analysts’ recommendations regarding our securities, and our performance relative to securities analysts’ expectations for any quarterly period. Further, even though our stock is quoted on the Nasdaq Global Select Market, our stock has had and may continue to have low trading volume and high volatility. The historically low trading volume of our stock makes it more likely that a significant fluctuation in volume, either up or down, will significantly impact the stock price. Because of the relatively low trading volume of our stock, our stockholders may have difficulty selling our common stock. In addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. Such volatility may adversely affect the market price of our common stock.

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Anti-takeover provisions in our charter and applicable law could delay or prevent an acquisition of our company.

Our restated certificate of incorporation provides for the division of our board of directors into three classes, eliminates the right of stockholders to act by written consent without a meeting, and provides our board of directors with the power to issue shares of preferred stock without stockholder approval. The preferred stock could have voting, dividend, liquidation, and other rights established by the board of directors that are superior to those of our common stock.

Our board of directors also adopted a stockholder rights plan, pursuant to which we declared and paid a dividend of one right for each share of common stock outstanding as of March 29, 2005, and one right attaches to each share issued thereafter until a specified date. Unless redeemed by us prior to the time the rights are exercised, upon the occurrence of certain events, the rights will entitle the holders to receive upon exercise of each right shares of our preferred stock, or shares of an acquiring entity, having a value equal to the exercise price of the right divided by 50% of the then market price of our common stock. The issuance of the rights could have the effect of delaying or preventing a change in control of our company.

In addition, Section 203 of the Delaware General Corporation Law contains provisions that impose restrictions on stockholder action to acquire our company. The effect of these provisions of our certificate of incorporation and Delaware law could discourage or prevent third parties from seeking to obtain control of us, including transactions in which the holders of common stock might receive a premium for their shares over prevailing market prices.

Item 1B.   Unresolved Staff Comments

None.

Item 2.   Properties

Our corporate headquarters and principal United States operating facility is located at 60 Corporate Woods, Rochester, New York, 14623, under an operating lease that expires in July 2015. We plan to move our corporate headquarters to 161 Sixth Avenue, New York, New York, effective September 15, 2009, where we have an office under an operating lease that expires in April 2012. In addition, we lease data collection centers to house our telephone interviewing centers in both Canada and the United Kingdom. We also lease service offices to house our project, administrative and processing staff in the following locations:

•  Rochester, New York;

•  New York, New York;

•  Princeton, New Jersey;

•  Norwalk, Connecticut;

•  Reston, Virginia;

•  Minneapolis, Minnesota;

•  Ann Arbor, Grand Rapids and Rochester, Michigan;

•  Portland, Oregon;

•  Claremont, California;

•  Washington, District of Columbia;

•  Brentford, Hazel Grove and Maidenhead, United Kingdom;

•  Ottawa and Toronto, Ontario;

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•  Montreal, Quebec;

•  Paris, France;

•  Hamburg, Germany;

•  Hong Kong and Shanghai, China; and

•  Singapore.

We lease all of our facilities and believe our current facilities are adequate to meet our needs for the foreseeable future. We continually assess the adequacy of our space needs relative to the size and scope of our business and may, from time to time, reduce our leased space accordingly. We believe that additional or alternative facilities can be leased to meet our future needs on commercially reasonable terms.

Information concerning each of our material properties is as follows (amounts in thousands):

			Remaining
			Lease Obligation
Address	Location	Termination Date	June 30, 2009
40-52 Watermans Park	Brentford, United Kingdom	June 2010	$	429
135 Corporate Woods	Rochester, New York	June 2010		332
Pepper Road	Hazel Grove, United Kingdom	July 2010		192
Vanwall Road	Maidenhead, United Kingdom	July 2010		178
BTC Beim Strohause 31	Hamburg, Germany	August 2010		295
70 Carlson Road	Rochester, New York	November 2009		114
161 Avenue of the Americas	New York, New York	April 2012		1,927
2345 Yonge Street	Toronto, Ontario	May 2012		450
101 Merritt 7	Norwalk, Connecticut	May 2015		2,042
60 Corporate Woods	Rochester, New York	July 2015		8,045
463 Lockhart Road, Causeway Bay	Hong Kong, China	September 2015		897
160 Elgin	Ottawa, Ontario	February 2016		3,010
1080 Beaver Hall Hill	Montreal, Quebec	April 2016		1,212
5 Independence Way	Princeton, New Jersey	December 2018		4,329

Item 3.   Legal Proceedings

In the normal course of business, we are at times subject to pending and threatened legal actions and proceedings. After reviewing with counsel pending and threatened actions and proceedings, management believes that the outcome of such actions or proceedings is not expected to have a material adverse effect on our business, financial condition or results of operations.

Item 4.   Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of security holders during the fourth quarter of fiscal 2009.

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PART II

Item 5.   Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock is traded on the Global Select Market of Nasdaq under the symbol “HPOL”. The following table shows, the high and low sales prices per share of our common stock on the Nasdaq exchange for fiscal 2009 and 2008.

	Fiscal 2009				Fiscal 2008
	High		Low		High		Low
Quarter Ended:
June 30	$	0.52	$	0.24	$	2.80	$	1.80
March 31		0.67		0.15		4.33		2.15
December 31		1.78		0.45		4.77		3.86
September 30		1.98		1.27		5.55		3.67

Holders

At August 24, 2009, our common stock was held by approximately 6,200 stockholders, reflecting stockholders of record or persons holding stock through nominee or street name accounts with brokers.

Dividends

We have never declared nor paid any cash dividends on our common stock. We currently anticipate that we will retain any future earnings for internal purposes, such as investing in our key strategic initiatives. Accordingly, we do not anticipate paying any cash dividends on our common stock in the foreseeable future.

Issuer Purchases of Equity Securities

There were no repurchases of our equity securities for the three months ended June 30, 2009.

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Performance Graph

The graph below matches the cumulative 5-year total return of holders of our common stock with the cumulative total returns of the NASDAQ Composite index, the S&P Smallcap 600 index and a customized peer group of seven companies that includes: Aegis Group plc, GFK AG, Intage Inc., National Research Corp., Ipsos SA, WPP Group plc and Yougov plc. The peer group previously also included Greenfield Online, Inc. and Taylor Nelson Sofres plc, neither of which continues to be publicly traded. The graph tracks the performance of a $100 investment in our common stock, in each index and in the peer group (assuming the reinvestment of all dividends) from June 30, 2004 to June 30, 2009.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Harris Interactive Inc., The NASDAQ Composite Index,
The S&P Smallcap 600 Index And A Peer Group

	6/04		6/05		6/06		6/07		6/08		6/09
Harris Interactive Inc.		100.00		72.47		84.82		79.61		29.91		6.10
NASDAQ Composite		100.00		101.09		109.49		132.47		117.33		92.91
S&P Smallcap 600		100.00		113.45		129.25		149.98		127.98		95.58
Peer Group		100.00		104.45		127.03		157.04		111.06		77.85

* $100 invested on 6/30/04 in stock or index, including reinvestment of dividends. Fiscal year ending June 30. Copyright^© 2009 S&P, a division of The McGraw -Hill Companies Inc. All rights reserved.

The stock price performance included in this graph is not necessarily indicative of future stock price performance.

The cumulative total shareholder return graph and accompanying information shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C promulgated by the SEC or the liabilities of Section 18 of the Exchange Act, except to the extent that the Company specifically requests that the information be treated as soliciting material or specifically incorporates it by reference into a document filed under the Securities Act or the Exchange Act. The cumulative total shareholder return graph and accompanying information shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent Harris Interactive specifically incorporates it by reference.

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Item 6.   Selected Financial Data

The following selected consolidated financial data of Harris Interactive should be read in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the notes to those statements and other financial information appearing elsewhere in this Form 10-K. The selected consolidated financial data reported below includes the financial results of the following entities which we acquired as of the dates indicated: Decima (August 2007), Marketshare (August 2007), MediaTransfer (April 2007), and Wirthlin (September 2004). In addition, information reported for fiscal years 2005 through 2008 has been reclassified to reflect our Japanese and Rent and Recruit operations as discontinued operations for all periods presented.

	For the Years Ended June 30,
	2009			2008			2007			2006			2005
	(In thousands, except share and per share amounts)
Statement of Operations Data:
Revenue from services	$	184,334		$	238,723		$	211,803		$	212,184		$	193,635
Operating expenses:
Cost of services(1)		115,235			140,578			122,052			122,148			103,269
Selling, general and administrative(1)		65,678			83,084			72,590			69,934			74,274
Depreciation and amortization		7,610			8,526			5,295			5,961			6,230
Gain on sale of assets		—			—			(788	)		—			—
Restructuring and other charges		12,010			4,609			337			250			1,132
Goodwill impairment charge		40,250			86,497			—			—			—
Total operating expenses		240,783			323,294			199,486			198,293			184,905
Operating income (loss)		(56,449	)		(84,571	)		12,317			13,891			8,730
Interest and other income		400			1,119			2,246			1,534			742
Interest expense		(3,433	)		(1,951	)		(290	)		(20	)		(150	)
Income (loss) from continuing operations before income taxes		(59,482	)		(85,403	)		14,273			15,405			9,322
Provision (benefit) for income taxes		15,849			(661	)		5,319			6,205			4,978
Income (loss) from continuing operations		(75,331	)		(84,742	)		8,954			9,200			4,344
Income (loss) from discontinued operations, net of tax		—			124			122			260			(2,761	)
Net income (loss) available to holders of common stock	$	(75,331	)	$	(84,618	)	$	9,076		$	9,460		$	1,583
Basic net income (loss) per share(*):
Continuing operations	$	(1.41	)	$	(1.60	)	$	0.16		$	0.15		$	0.07
Discontinued operations		—			0.00			0.00			0.00			(0.05	)
Basic net income (loss) per share	$	(1.41	)	$	(1.60	)	$	0.16		$	0.15		$	0.03
Diluted net income (loss) per share(*):
Continuing operations	$	(1.41	)	$	(1.60	)	$	0.16		$	0.15		$	0.07
Discontinued operations		—			0.00			0.00			0.00			(0.05	)
Diluted net income (loss) per share	$	(1.41	)	$	(1.60	)	$	0.16		$	0.15		$	0.03
Weighted-average shares outstanding — basic		53,547,670			52,861,354			56,133,355			61,511,031			60,264,152
Weighted-average shares outstanding — diluted		53,547,670			52,861,354			56,397,600			61,685,777			61,238,064

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	For the Years Ended June 30,
	2009		2008		2007		2006		2005
	(In thousands, except share and per share amounts)
Balance Sheet Data:
Cash and cash equivalents	$	16,752	$	32,874	$	28,911	$	11,465	$	13,118
Marketable securities	$	1,010	$	—	$	4,418	$	45,145	$	23,392
Working capital	$	10,778	$	32,489	$	22,046	$	62,026	$	46,426
Total assets	$	84,527	$	187,049	$	242,038	$	256,923	$	241,829
Short-term borrowings	$	—	$	—	$	19,625	$	—	$	—
Long-term borrowings	$	22,506	$	29,431	$	—	$	—	$	—
Total stockholders’ equity	$	18,123	$	98,636	$	172,356	$	203,644	$	194,164

(*)	Figures may not add due to rounding
(1)	Amounts for fiscal year 2005 are not directly comparable to subsequent fiscal years, as a result of our adoption of SFAS No. 123(R) using the modified prospective method.

Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Note: All amounts shown below are in thousands of U.S. Dollars, unless otherwise noted.

Overview

Throughout fiscal 2009, we have taken a number of steps that we believe are critical to our ability to restore revenue and profitability, including:

•  restructuring the Company to better align our cost structure with expected revenue, by proactively taking the actions described below under “Restructuring and Other Charges,” which took nearly $22,000 in annualized costs out of the business, approximately $6,000 (on an annualized basis) of which we anticipate will be re-invested in talent during fiscal 2010 to support our key strategic initiatives,

•  renegotiating our credit agreement to keep our term loans in place and provide a $5,000 line of credit to meet short-term working capital needs,

•  creating a new integrated research and selling organization that better serves our clients,

•  forming global centers of excellence to better develop and deliver products and solutions into the marketplace, and

•  continuing recruitment initiatives to attract top talent to augment the strong talent already at the Company.

We believe it is likely that the unfavorable global macroeconomic conditions, which have negatively impacted our revenue and profitability during fiscal 2009 as described in more detail below, may continue to persist. According to industry analysts at Inside Research, 80% of market research buyers have faced cutbacks of their market research budgets in calendar 2009, compared with only 30% in calendar 2008. Despite this outlook, we remain focused on continuing to implement our strategy to grow revenue and regain market share by capitalizing on our strong brand and leveraging the expertise and insights our client teams possess, all with an eye toward a sustaining future for Harris.

Goodwill Impairment Charges

Fiscal 2009

At September 30, 2008, we considered the incremental decline in our stock price from $2.01 at June 30 to $1.73 at the end of September. At that time, we concluded that this decline was short-term

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in nature and absent factors to the contrary, did not trigger a review for impairment outside of our next scheduled annual impairment evaluation date, June 30, 2009.

As part of our closing process for the three months ended December 31, 2008, we considered the following factors in determining whether an impairment review outside of our annual impairment evaluation date was necessary:

•  operating losses in our single reporting unit for the fiscal quarters ended September 30, 2008 and December 31, 2008,

•  potential declines in market research spending for calendar year 2009 based on industry forecasts from Inside Research,

•  headcount reductions and related charges as announced in October and December 2008, the details of which are described in Note 4, “Restructuring and Other Charges,” to our consolidated financial statements included in this Form 10-K,

•  a 62% decline in our per share stock price from $1.73 at September 30, 2008 to $0.65 at December 31, 2008, which resulted in a market capitalization that, based on our per share stock price as of market close on December 31, 2008, was below the carrying value of our reporting unit’s net assets at that date.

Based on our consideration of the above-noted factors, we concluded that an interim period goodwill impairment evaluation was necessary at December 31, 2008. Accordingly, we performed the initial step of our impairment evaluation and determined that the carrying value of our single reporting unit’s net assets exceeded their fair value. The fair value of the reporting unit was determined using a discounted cash flow analysis, which used a discount rate based on our best estimate of the after-tax weighted average cost of capital, adjusted for the financial risk associated with our future operations.

In the second step of our impairment evaluation, we determined the implied fair value of goodwill and compared it to the carrying value of the goodwill. The fair value of our reporting unit was allocated to all of its assets and liabilities as if it had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. This allocation resulted in no implied fair value of goodwill. Therefore, we recognized an impairment charge of $40,250, the remaining amount of our previously reported goodwill.

During the three months ended December 31, 2008, as a result of the factors discussed above, we also tested our asset groups for recoverability under SFAS No. 144. As the projected undiscounted cash flows for the individual asset groups exceeded the carrying value of the long-lived assets for each asset group, we did not record an impairment charge for any of our long-lived assets during the three months ended December 31, 2008. No additional facts and circumstances arose during the remainder of fiscal 2009 to change this conclusion.

Fiscal 2008

At March 31, 2008, we considered the decline in our stock price from January 2008 to March 2008. At that time, we concluded that the decline was short-term in nature and did not trigger a review for impairment outside of our annual June 30 impairment evaluation date.

At June 30, 2008, we performed the initial step of our impairment evaluation by comparing the fair market value of our single reporting unit, as determined using a discounted cash flow model, to its carrying value. As the carrying amount exceeded the fair value, we performed the second step of our impairment evaluation to calculate impairment and as a result, recorded a pre-tax goodwill impairment charge of $86,497. The primary reason for the impairment charge was the sustained decline of our stock price during the second half of fiscal 2008.

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Income Tax Valuation Allowance

During the second quarter of fiscal 2009, our judgment regarding our U.S. deferred tax assets changed, as the current macroeconomic environment and our U.S. losses in the most recent three-year period presented significant negative evidence such that a valuation allowance against our net U.S. deferred tax assets was required. Accordingly, we recorded a valuation allowance of $18,861 in the three months ended December 31, 2008 against the deferred tax assets of our U.S. operations. We will continue to assess the realizability of these deferred tax assets in accordance with SFAS No. 109 and will adjust the valuation allowance should all or a portion become realizable in the future.

Restructuring and Other Charges

Restructuring

Fiscal 2009

During the third quarter of fiscal 2009, we took actions to re-align the cost structure of our U.S. and U.K. operations. Specifically, we reduced headcount at our U.S. facilities by 92 full-time employees and announced plans to reduce headcount at our U.K. facilities by 25 full-time employees. One-time termination benefits associated with the U.S. and U.K. actions were $2,656 and $389, respectively, all of which involved cash payments. These actions were communicated to the affected employees in March 2009. All actions were completed by March 2009 in the U.S. and May 2009 in the U.K. The related cash payments were completed by June 2009 in the U.K. and will be completed by March 2010 in the U.S.

At March 31, 2009, we reviewed the estimate of anticipated sublease rental income for our Rochester, New York offices, located at 135 Corporate Woods. This review, prompted by adverse changes in real estate market conditions, resulted in a decrease to our estimate of the portion of the remaining lease obligation period over which we expect to derive sublease rental income. This change in estimate resulted in a charge of $35 in the third quarter of fiscal 2009.

Previously, during the second quarter of fiscal 2009, we took actions to re-align the cost structure of our U.S. operations. Specifically, we reduced headcount at our U.S. facilities by 78 full-time employees and incurred $2,261 in one-time termination benefits, all of which involved cash payments. The reductions in staff were communicated to the affected employees in October and December 2008. All actions were completed by December 2008 and we expect the related cash payments to be completed by December 2009.

Additionally during the second quarter of fiscal 2009, we substantially vacated leased space at 135 Corporate Woods. We incurred $493 in charges related to the remaining operating lease obligation, all of which involved cash payments. All actions associated with this vacated space were completed by December 2008. We expect the related cash payments to be completed by June 2010.

At December 31, 2008, we reviewed the estimates of anticipated sublease rental income for our Grandville, MI and Norwalk, CT offices, which were included in restructuring charges taken during the third quarter of fiscal 2008 in conjunction with our reduction of leased space at these facilities. This review, prompted by adverse changes in real estate market conditions within each of these locales, resulted in a decrease to our estimate of the portion of the remaining lease obligation period over which we expect to derive sublease rental income. This change in estimate resulted in a charge of $366 for the three months ended December 31, 2008.

Restructuring charges for fiscal 2009 totaled $5,657. The headcount and leased space reductions described above took nearly $22,000 in annualized costs out of the business, approximately $6,000 (on an annualized basis) of which we anticipate will be re-invested in talent during fiscal 2010 to support our key strategic initiatives.

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Fiscal 2008

During the fourth quarter of fiscal 2008, we took certain actions designed to align the cost structure of our U.K. operations with the evolving operational needs of that business. Specifically, we reduced headcount at our U.K. facilities by 18 full-time employees and incurred $544 in one-time termination benefits, all of which involved cash payments. The reduction in staff was communicated to the affected employees in June 2008. All actions were completed by July 31, 2008 and the related cash payments were completed in September 2008.

The U.K. restructuring described above follows separate actions we took at various times during the fourth quarter of fiscal 2008 to strategically reduce headcount at several of our U.S. facilities by a total of 24 full-time equivalents, as a result of which we incurred $512 in one-time termination benefits, all of which involved cash payments. The reduction in staff was communicated to the affected employees in April 2008. Additionally, we took steps to reduce costs associated with our U.S. operations by reducing leased space at our Cincinnati, Ohio facility. We incurred $135 in contract termination charges related to the remaining operating lease obligation, all of which involved cash payments. All actions associated with these headcount and leased space reductions were completed in April and May 2008, respectively, and the related cash payments were completed in October 2008 and April 2009, respectively.

During the third quarter of fiscal 2008, we recorded $1,138 in restructuring charges directly related to our decisions made at various times during the quarter to close our telephone center in Orem, Utah by March 2008, strategically reduce headcount, and reduce leased space at our Grandville, Michigan and Norwalk, Connecticut offices. Each decision was designed to better align our cost structure with the evolving operational needs of the business.

In connection with the Orem closure, we reduced our headcount by 26 full-time equivalents and incurred $166 in one-time termination benefits. The reduction in staff was communicated to the affected employees in January 2008. Additionally, we incurred $120 in contract termination charges related to the remaining operating lease obligation. All actions were completed by March 31, 2008 and involved cash payments, which were completed in August 2008.

An additional headcount reduction of 15 full-time equivalents occurred in February 2008 and resulted in $334 in one-time termination benefits, all of which involved cash payments. The reduction in staff was communicated to the affected employees in February 2008. All actions associated with this headcount reduction were completed in February 2008, and cash payments in connection with the one-time termination benefits were completed in September 2008.

In connection with the leased space reductions in Grandville and Norwalk, we incurred $518 in contract termination charges related to the remaining operating lease obligations, all of which involved cash payments. All actions associated with the space reductions were completed in March 2008. Cash payments in connection with the remaining lease obligations will be completed by April 2015.

As a result of the actions described above, we realized approximately $1,800 in cash savings during fiscal 2008 and approximately $5,800 during fiscal 2009.

Fiscal 2007

During the fourth quarter of fiscal 2007, we recorded $337 in restructuring charges directly related to a facilities consolidation and headcount reduction, both designed to ensure the alignment of our cost structure with the operational needs of the business. We negotiated an amendment to the lease agreement for our Reston, Virginia office, terminating our lease with respect to a portion of our space in exchange for a payment of $230 to the landlord, subject to conditions which have since been met. As a result of the amendment, our lease obligation over the remaining term of the lease was reduced by approximately $500 from the initial lease, which, when offset against the payment to the landlord for the space reduction noted above, resulted in anticipated net savings of approximately $300 over the remaining lease term.

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We also reduced the staff of our U.S. operations by 6 full-time equivalents and incurred $107 in severance charges, all of which involved cash payments. The reduction in staff was communicated to the affected employees during the fourth quarter of fiscal 2007. All actions in the plan were completed by June 30, 2007. Cash payments in connection with the plan were completed in December 2007.

As a result of the actions described above, we realized cash savings of approximately $800 in fiscal 2008, consistent with our savings expectation at the time that these actions were taken.

Other Charges

Other charges totaled $6,353 and $2,346 for fiscal 2009 and 2008, respectively, and included the following:

•  Contractually obligated payments to former executives — In connection with their departures during fiscal 2009, Gregory T. Novak, Ronald E. Salluzzo and David B. Vaden became entitled to certain contractually obligated payments, all of which are cash payments. These cash payments will be completed in December 2010, December 2009 and February 2010, respectively.

During fiscal 2008, we incurred $762 in severance charges for Leonard R. Bayer, our former Executive Vice President, Chief Scientist and Chief Technology Officer, in connection with his retirement, which was effective March 31, 2008. This amount was reclassified from the “Selling, general and administrative” expense line in our consolidated statements of operations to conform to the current year presentation, as more fully described in Note 2, “Summary of Significant Accounting Policies — Reclassifications,” to our consolidated financial statements included in this Form 10-K.

•  Performance improvement consultant fees — We retained a consulting firm to assist with performance improvement initiatives, bank negotiations and interim CFO services and incurred fees for services rendered during fiscal 2009.

•  Cost of reviewing strategic alternatives — During fiscal 2008, we incurred legal, accounting, banking and other costs in connection with a decision by our Board of Directors to investigate strategic alternatives available to the Company. After retaining an investment bank to assist with this process and considering the results of the investigations, the Board determined that it was in the best interests of our stockholders to discontinue the process.

•  Bank negotiation legal fees — During fiscal 2009, we incurred legal fees in connection with the negotiation of the amendments to our credit agreement.

•  Other — Included in “Other” is the bad debt expense for a note receivable, for which collectability has become doubtful, and recruitment fees for senior executives during fiscal 2009.

Further financial information about our restructuring plans and activities is included in Note 4, “Restructuring and Other Charges,” to our consolidated financial statements contained in this Form 10-K.

Critical Accounting Policies and Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect amounts reported therein. The most significant of these areas involving difficult or complex judgments made by management with respect to the preparation of our financial statements in fiscal 2009 include:

•  Revenue recognition,

•  Impairment of goodwill and other intangible assets,

•  Impairment of long-lived assets,

•  Income taxes,

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•  Stock-based compensation,

•  HIpoints loyalty program, and

•  Contingencies and other accruals.

In each situation, management is required to make estimates about the effects of matters or future events that are inherently uncertain.

Revenue Recognition

We recognize revenue from services on a proportional performance basis. In assessing contract performance, both input and output criteria are reviewed. Costs incurred are used as an objective input measure of performance. The primary input of all work performed under these arrangements is labor. As a result of the relationship between labor and cost, there is normally a direct relationship between the costs incurred and the proportion of the contract performed to date. Costs incurred as an initial proportion of expected total costs is used as an initial proportional performance measure. This indicative proportional performance measure is always subsequently validated against more subjective criteria (i.e. relevant output measures) such as the percentage of interviews completed, percentage of reports delivered to a client and the achievement of any project milestones stipulated in the contract. In the event of divergence between the objective and more subjective measures, the more subjective measures take precedence since these are output measures.

Clients are obligated to pay based upon services performed, and in the event that a client cancels the contract, the client is responsible for payment for services performed through the date of cancellation. Losses expected to be incurred, if any, on jobs in progress are charged to income as soon as it becomes probable that such losses will occur. Invoices to clients in the ordinary course are generated based upon the achievement of specific events, as defined by each contract, including deliverables, timetables, and incurrence of certain costs. Such events may not be directly related to the performance of services. Revenues earned on contracts in progress in excess of billings are classified as unbilled receivables. Amounts billed in excess of revenues earned are classified as deferred revenue.

Revisions to estimated costs and differences between actual contract losses and estimated contract losses would affect both the timing of revenue allocated and the results of our operations.

Impairment of Goodwill and Other Intangible Assets

SFAS No. 142, Goodwill and Other Intangible Assets, requires us to test goodwill for impairment on an annual basis and between annual tests in certain circumstances, and to write down goodwill and non-amortizable intangible assets when impaired. The evaluation of other intangible assets is performed on a periodic basis. These assessments require us to estimate the fair market value of our single reporting unit. If we determine that the fair value of our reporting unit is less than its carrying amount, absent other facts to the contrary, we must recognize an impairment charge for the associated goodwill of the reporting unit against earnings in our consolidated financial statements. As we have one reportable segment, we utilize the entity-wide approach for assessing goodwill.

Goodwill is evaluated for impairment at least annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors we consider important that could trigger a review for impairment include the following:

•  Significant under-performance relative to historical or projected future operating results;

•  Significant changes in the manner of our use of acquired assets or the strategy for our overall business;

•  Significant negative industry or economic trends;

•  Significant decline in our stock price for a sustained period; and

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•  Significant decline in our market capitalization relative to net book value.

Due to the numerous variables associated with our judgments and assumptions relating to the valuation of the reporting unit and the effects of changes in circumstances affecting this valuation, both the precision and reliability of the resulting estimates are subject to uncertainty, and as additional information becomes known, we may change our estimates.

Goodwill is evaluated for impairment using the two-step process as prescribed in SFAS No. 142. The first step is to compare the fair value of the reporting unit to its carrying amount. If the carrying amount exceeds the fair value, a second step must be followed to calculate impairment. Otherwise, if the fair value of our reporting unit exceeds the carrying amount, the goodwill is not considered to be impaired as of the measurement date. To determine fair value for our reporting unit, we use the fair value of the cash flows that the reporting unit can be expected to generate in the future. This valuation method requires management to project revenues, operating expenses, working capital investment, capital spending and cash flows for our reporting unit over a multiyear period, as well as determine the weighted average cost of capital to be used as a discount rate. Significant management judgment is involved in preparing these estimates. Changes in projections or estimates could significantly change the estimated fair value of our reporting unit and affect the recorded balance of goodwill. In addition, if management uses different assumptions or estimates in the future or if conditions exist in future periods that are different than those anticipated, future operating results and the balance of goodwill in the future could be affected by impairment charges.

Impairment of Long-Lived Assets

We account for the impairment or disposal of long-lived assets in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Events that trigger a test for recoverability include material adverse changes in the projected revenues and expenses, significant underperformance relative to historical or projected future operating results, and significant negative industry or economic trends. A test for recoverability also is performed when we have committed to a plan to sell or otherwise dispose of an asset group and the plan is expected to be completed within a year. Recoverability of an asset group is evaluated by comparing its carrying value to the future net undiscounted cash flows expected to be generated by the asset group. If the comparison indicates that the carrying value of an asset group is not recoverable, an impairment loss is recognized. The impairment loss is measured by the amount by which the carrying amount of the asset group exceeds the estimated fair value. When an impairment loss is recognized for assets to be held and used, the adjusted carrying amount of those assets is depreciated over its remaining useful life. Restoration of a previously-recognized long-lived asset impairment loss is not allowed.

We estimate the fair value of an asset group based on market prices (i.e., the amount for which the asset could be bought by or sold to a third party), when available. When market prices are not available, we estimate the fair value of the asset group using the income approach and/or the market approach. The income approach uses cash flow projections. Inherent in our development of cash flow projections are assumptions and estimates derived from a review of our operating results, approved business plans, expected growth rates and cost of capital, among others. We also make certain assumptions about future economic conditions, interest rates, and other market data. Many of the factors used in assessing fair value are outside the control of management, and these assumptions and estimates can change in future periods.

Changes in assumptions or estimates could materially affect the determination of fair value of an asset group, and therefore could affect the amount of potential impairment of the asset. The following assumptions are key to our income approach:

•  Business Projections — We make assumptions about the level of demand for our services in the marketplace. These assumptions drive our planning assumptions for revenue growth. We also make assumptions about our cost levels. These assumptions are key inputs for developing our cash flow projections. These projections are derived using our internal business plans.

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•  Growth Rate — The growth rate is the expected rate at which an asset group’s earnings stream is projected to grow beyond the planning period.

•  Economic Projections — Assumptions regarding general economic conditions are included in and affect our assumptions regarding revenue from services. These macroeconomic assumptions include inflation, interest rates and foreign currency exchange rates.

Income Taxes

We account for income taxes using the asset and liability method in accordance with SFAS No. 109, Accounting for Income Taxes. Under SFAS No. 109, deferred tax assets and liabilities are recognized for future tax consequences attributable to operating loss carryforwards and differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases for operating profit and tax liability carryforward.

SFAS No. 109 requires the establishment of a valuation allowance to reflect the likelihood of the realization of deferred tax assets. Significant management judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We evaluate the weight of the available evidence to determine whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The decision to record a valuation allowance requires varying degrees of judgment based upon the nature of the item giving rise to the deferred tax asset. The amount of the deferred tax asset considered realizable is based on significant estimates, and it is at least reasonably possible that changes in these estimates in the near term could materially affect our financial condition and results of operations.

On July 1, 2007, we adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109, which contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Although we believe we have adequately provided for our uncertain tax positions, no assurance can be given with respect to the final outcome of these matters. We adjust reserves for our uncertain tax positions due to changing facts and circumstances, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final outcome of these matters is different than the amounts recorded, such differences will impact our provision for income taxes in the period in which such a determination is made. Our provisions for income taxes include the impact of reserve provisions and changes to reserves that are considered appropriate and also include the related interest and penalties.

Stock-Based Compensation

On July 1, 2005, we adopted SFAS No. 123(R), Share-Based Payment, which requires the recognition of compensation expense for all share-based payments made to employees based on the fair value of the share-based payment on the date of grant. We elected to use the modified prospective approach for adoption, which requires that compensation expense be recorded for the unvested portion of previously issued awards that remain outstanding at July 1, 2005 using the same estimate of the grant date fair value and the same attribution method used to determine the pro forma disclosure under SFAS No. 123, Accounting for Stock-Based Compensation.

For share-based payments granted subsequent to July 1, 2005, compensation expense based on the grant date fair value is recognized in our consolidated statements of operations over the requisite

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service period. In determining the fair value of stock options, we use the Black-Scholes option pricing model, which employs the following assumptions:

•  Expected volatility — based on historical volatilities from daily share price observations for our stock covering a period commensurate with the expected term of the options granted.

•  Expected life of the option — based on the vesting terms of the respective option and a contractual life of ten years, calculated using the “simplified method” as allowed by Staff Accounting Bulletin No. 110, Share-Based Payment.

•  Risk-free rate — based on the implied yield available at the time the options were granted on U.S. Treasury zero coupon issues with a remaining term equal to the expected life of the option when granted.

•  Dividend yield — based on our historical practice of electing not to pay dividends to our shareholders.

Expected volatility and the expected life of the options granted, both of which impact the fair value of the option calculated under the Black-Scholes option pricing model, involve management’s best estimates at that time. The weighted-average assumptions used to value options during the fiscal years ended June 30, 2007, 2008 and 2009, respectively, are set forth in Note 14, “Stock-Based Compensation,” to our consolidated financial statements contained in this Form 10-K. The fair value of our restricted stock awards is based on the price per share of our common stock on the date of grant. We grant options to purchase our stock at fair value as of the date of grant.

SFAS No. 123(R) also requires that we recognize compensation expense for only the portion of options or restricted shares that are expected to vest. Therefore, we apply estimated forfeiture rates that are derived from historical employee termination behavior and the vesting period of the respective stock options or restricted shares. If the actual number of forfeitures differs from those estimated by management, additional adjustments to compensation expense may be required in future periods.

HIpoints Loyalty Program

In July 2001, we initiated HIpoints, a loyalty program designed to reward respondents who register for our online panel, complete online surveys and refer others to join our online panel. The earned points are non-transferable and may be redeemed for gifts from a specific product folio at any time prior to expiration. We maintain a reserve for our obligations with respect to future redemption of outstanding points based on the expected redemption rate of the points. This expected redemption rate is based on our actual redemption rates since the inception of the program. An actual redemption rate that differs from the expected redemption rate could have a material impact on our results of operations.

Prior to December 2007, points under the HIpoints program expired after one year of account inactivity. In December 2007, we modified the expiration parameters of the program such that points now expire after nine months of account inactivity and tightened the rules around expirations to more accurately account for panelists that are not truly engaged in the program. These changes resulted in an approximately $800 reduction in our reserve for obligations with respect to future redemption of outstanding points during the second quarter of fiscal 2008, which was recorded in the “Cost of services” line of our consolidated statement of operations.

Contingencies and Other Accruals

From time to time, we record accruals for severance costs both in connection with formal restructuring programs and in the normal course, lease costs associated with excess facilities, contract terminations and asset impairments as a result of actions we undertake to streamline our organization, reposition certain businesses and reduce ongoing costs. Estimates of costs to be incurred to complete these actions, such as future lease payments, sublease income, the fair value of

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assets, and severance and related benefits, are based on assumptions at the time the actions are initiated. To the extent actual costs differ from those estimates, reserve levels may need to be adjusted. In addition, these actions may be revised due to changes in business conditions that we did not foresee at the time such actions were approved. Additionally, we record accruals for estimated incentive compensation costs during each year. Amounts accrued at the end of each reporting period are based on our estimates and may require adjustment as the ultimate amount paid for these incentives are sometimes not finally determinable until the completion of our fiscal year end closing process.

Explanation of Key Financial Statement Captions

Revenue from Services

We recognize revenue from services on a proportional performance basis, as more particularly described above in “Critical Accounting Policies and Estimates — Revenue Recognition”.

Our revenue from services is derived principally from the following:

•  Custom Research — including, but not limited to, customer satisfaction surveys, market share studies, new product introduction studies, brand recognition studies, reputation studies and ad concept testing.

•  Tracking Studies — studies that regularly ask identical questions to similar demographic groups within a constant interval (once a month, once a quarter, etc.) to feed business decision-makers with dynamic data and intelligence.

•  Service-Bureau Research — HISB provides data collection services primarily for other market research firms.

Cost of Services

Our direct costs associated with generating revenues principally consist of the following items:

•  Project Personnel — Project personnel have four distinct roles: project management, survey design, data collection, and data analysis. We maintain project personnel in North America, Europe, and Asia. Labor costs are specifically allocated to the projects they relate to. We utilize a timekeeping system, which tracks the time of project personnel as incurred for each specific revenue-generating project.

•  Panelist Incentives — Our panelists receive both cash and non-cash incentives (through programs such as our HIpoints loyalty program) for participating in our surveys. We award cash incentives to our panelists for participating in surveys, which are earned when we receive a timely and complete survey response. Non-cash incentives in the form of points are awarded to market survey respondents who register for our online panel, complete online surveys and refer others to join our online panel. The earned points are non-transferable and may be redeemed for gifts from a specific product folio at any time prior to their expiration.

•  Data Processing — We manage the processing of survey data using our own employees. We also engage third-party suppliers to perform data processing on an as-needed basis.

•  Other Direct Costs — Other direct costs include direct purchases, principally labor and materials, related to data collection and analysis, and the amortization of software developed for internal use.

Selling, General and Administrative

Selling, general and administrative expense includes the following:

•  payroll and related costs, including commissions, for sales and marketing professionals,

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•  payroll and related costs for staff in the areas of finance, human resources, information technology and executive management, and

•  other indirect costs necessary to support the business, including among others, office rents, travel, stock-based compensation and public company costs.

Provision for Income Taxes

The provision for income taxes includes current and deferred income taxes. Furthermore, deferred tax assets are recognized for the expected realization of available net operating loss carryforwards. A valuation allowance is recorded when it is necessary to reduce a deferred tax asset to an amount that we expect to realize in the future. We continually review the adequacy of our valuation allowance and adjust it based on whether or not our assessment indicates that it is more likely than not that these benefits will be realized.

Results of Operations

The following table sets forth the results of our continuing operations, expressed both as a dollar amount and as a percentage of revenue from services, for the fiscal years ended June 30:

	2009			%			2008			%			2007			%
Revenue from services	$	184,334			100.0	%	$	238,723			100.0	%	$	211,803			100.0	%
Operating expenses:
Cost of services		115,235			62.5			140,578			58.9			122,052			57.6
Selling, general and administrative		65,678			35.6			83,084			34.8			72,590			34.3
Depreciation and amortization		7,610			4.1			8,526			3.6			5,295			2.5
Gain on sale of assets		—			—			—			—			(788	)		(0.4	)
Restructuring and other charges		12,010			6.5			4,609			1.9			337			0.2
Goodwill impairment charge		40,250			21.8			86,497			36.2			—			—
Operating income (loss)		(56,449	)		(30.6	)		(84,571	)		(35.4	)		12,317			5.8
Interest and other income		400			0.2			1,119			0.5			2,246			1.1
Interest expense		(3,433	)		(1.9	)		(1,951	)		(0.8	)		(290	)		(0.1	)
Income (loss) from continuing operations before taxes		(59,482	)		(32.3	)		(85,403	)		(35.8	)		14,273			6.7
Provision (benefit) for income taxes		15,849			8.6			(661	)		(0.3	)		5,319			2.5
Income (loss) from continuing operations		(75,331	)		(40.9	)		(84,742	)		(35.5	)		8,954			4.2
Income from discontinued operations, net of tax		—			—			124			0.1			122			0.1
Net income (loss)	$	(75,331	)		(40.9	)	$	(84,618	)		(35.4	)	$	9,076			4.3

The results of continuing operations as presented and discussed herein do not include the results of our discontinued Rent and Recruit business. Additionally, certain amounts in prior years’ consolidated financial statements have been reclassified to conform to the current year’s presentation, as more fully described in Note 2, “Summary of Significant Accounting Policies — Reclassifications.”

Fiscal Year Ended June 30, 2009 Versus Fiscal Year Ended June 30, 2008

Revenue from services.  Revenue from services decreased by $54,389, or 22.8%, to $184,334 for fiscal 2009 compared with fiscal 2008. As more fully described below, revenue from services was

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impacted by several factors and included a negative foreign exchange rate impact of $12,148 in fiscal 2009 compared with fiscal 2008.

North American revenue decreased by $44,762 to $132,760 for fiscal 2009 compared with fiscal 2008, a decrease of 25.2%. By country, North American revenue for fiscal 2009 was comprised of:

•  Revenue from U.S. operations of $112,821, down 26.2% compared with $152,894 for fiscal 2008. The decline in U.S. revenue was largely the result of the adverse macroeconomic trends discussed above under “Risks Related to Our Business”, which have resulted in revenue declines across the majority of our U.S. research groups compared with fiscal 2008.

•  Revenue from Canadian operations of $19,939, down 19.0% compared with $24,628 for fiscal 2008. The decrease in Canadian revenue was principally driven by a $2,979 negative foreign exchange rate impact on fiscal 2009 Canadian revenue compared with fiscal 2008, as well as decreases in the research budgets at several of our Canadian unit’s key clients. On a local currency basis, Canadian revenue decreased by 5.9% compared with fiscal 2008.

European revenue decreased by $11,691 to $46,990 for fiscal 2009 compared with fiscal 2008, a decrease of 19.9%. By country, European revenue for fiscal 2009 was comprised of:

•  Revenue from U.K. operations of $32,454, down 25.9% compared with $43,771 for fiscal 2008. U.K. revenue for fiscal 2009 included an $8,001 negative foreign exchange rate impact, which principally drove the decrease in U.K. revenue from fiscal 2008. The decrease in U.K. revenue was also impacted by the adverse macroeconomic trends discussed above under “Risks Related to Our Business”. On a local currency basis, U.K. revenue decreased by 7.5% compared with fiscal 2008.

•  Revenue from French operations of $8,535, up 9.1% compared with $7,823 for fiscal 2008. French revenue for fiscal 2009 included a $704 negative foreign exchange rate impact compared with fiscal 2008. On a local currency basis, French revenue increased by 18.0% compared with fiscal 2008. The increase in French revenue was principally driven by growth within the Healthcare and Consumer research groups.

•  Revenue from German operations of $6,001, down 15.3% compared with $7,087 for fiscal 2008. German revenue for fiscal 2009 included a $423 negative foreign exchange rate impact compared with fiscal 2008. On a local currency basis, German revenue decreased by 12.6% compared with fiscal 2008. The decrease in German revenue was principally driven by decreases in the research budgets at several of our German unit’s key clients.

Asian revenue increased by $2,064 to $4,584 for fiscal 2009, an increase of 81.9% compared with fiscal 2008. The increase was principally impacted by increased focus on driving business with clients in the pharmaceutical, telecommunications and hotel industries. The impact of the foreign exchange rate on Asian revenue was inconsequential compared with fiscal 2008.

Cost of services.  Cost of services was $115,235 or 62.5% of total revenue for fiscal 2009, compared with $140,578 or 58.9% of total revenue for fiscal 2008. Cost of services was impacted by the declines in revenue discussed above, the headcount reductions taken throughout fiscal 2009, as more fully described above under “Restructuring and Other Charges,” and the differing types of custom research projects performed in fiscal 2009 compared with fiscal 2008. Cost of services as a percentage of revenue for fiscal 2009 was greater than fiscal 2008 given the pace of the declines in revenue relative to the timing of our cost reductions.

Selling, general and administrative.  Selling, general and administrative expense for fiscal 2009 was $65,678 or 35.6% of total revenue for fiscal 2009, compared with $83,084 or 34.8% of total

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revenue for fiscal 2008. Selling, general and administrative expense was principally impacted by the following:

•  a $9,548 decrease in payroll-related expense, driven by headcount reductions taken throughout this fiscal year,

•  a $2,126 decrease in stock-based compensation expense, driven by the departures of several senior executives from the prior management team throughout this fiscal year,

•  a $1,965 decrease in travel expense, driven by our continued focus on controlling these costs, and

•  a $942 decrease in office rent, driven by space reductions taken during fiscal 2008 and 2009.

The remainder of the decrease in selling, general and administrative expense was the result of decreases across a number of other operating expense categories because of our continued focus on ensuring appropriate alignment of our cost structure relative to the needs of our business.

Depreciation and amortization.  Depreciation and amortization was $7,610 or 4.1% of total revenue for fiscal 2009, compared with $8,526 or 3.6% of total revenue for fiscal 2008. The decrease in depreciation and amortization expense when compared with fiscal 2008 was the result of fixed and intangible assets that became fully depreciated or amortized during fiscal 2009 combined with decreased capital spending during fiscal 2009 as part of our overall focus on controlling costs.

Restructuring and other charges.   See above under “Restructuring and Other Charges” for a discussion of restructuring charges incurred during fiscal 2009 and 2008.

Goodwill impairment charge.  See above under “Goodwill Impairment Charges” for a discussion of the goodwill impairment charges incurred during fiscal 2009 and 2008.

Interest and other income.  Interest and other income was $400 or 0.2% of total revenue for fiscal 2009, compared with $1,119 or 0.5% of total revenue for fiscal 2008. The decrease in interest and other income was principally the result of having a lower average cash balance and lower rate of return for fiscal 2009 when compared with fiscal 2008.

Interest expense.  Interest expense was $3,433 or 1.9% of total revenue for fiscal 2009, compared with $1,951 or 0.8% of total revenue for fiscal 2008. The increase in interest expense was principally the result of a $1,017 charge recorded during fiscal 2009 to reflect the ineffectiveness of our interest rate swap as a cash flow hedge during the second and third quarters of fiscal 2009, along with an increase in the applicable spread under our credit facilities from 0.875% to 5.00%, each as a result of the covenant violations and subsequent waivers and amendments to our credit agreement described below under “Liquidity and Capital Resources — Credit Facilities”.

Income taxes.  We recorded an income tax provision of $15,849 for fiscal 2009, compared with an income tax benefit of $(661) for fiscal 2008. The tax provision for fiscal 2009 was principally impacted by the valuation allowance recorded against our U.S. deferred tax assets, as discussed above under “Income Taxes” and the tax non-deductibility of the goodwill impairment charge described above under “Goodwill Impairment Charges.”

Fiscal Year Ended June 30, 2008 Versus Fiscal Year Ended June 30, 2007

Revenue from services.  Revenue from services increased by $26,920 to $238,723 for fiscal 2008, an increase of 12.7% over fiscal 2007. Revenue from services was impacted by several factors, as more fully described below.

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North American revenue increased by $17,679 to $177,522 for fiscal 2008, an increase of 11.1% over fiscal 2007. For fiscal 2008, North American revenue was comprised of:

•  $152,894 from U.S. operations, down 4.3% compared with $159,843 for fiscal 2007. The decrease in U.S. revenue was impacted by revenue declines in the following industry groups:

•  Healthcare, as a result of budget cuts in the pharmaceutical industry as well as the replacement of industry team leadership, and

•  Emerging and General Markets, as a result of this group’s transition to new sales leadership during the fiscal year.

•  $24,628 from Canadian operations, all of which was attributable to our August 2007 acquisition of Decima.

European revenue increased by $6,721 to $58,681 for fiscal 2008, an increase of 12.9% over fiscal 2007. For fiscal 2008, European revenue was comprised of:

•  $43,771 from our U.K. operations, essentially flat when compared with $43,655 for fiscal 2007, and

•  $14,910 from our French and German operations, compared with $8,305 from those operations for fiscal 2007. The increase in revenue from these operations was principally the result of our April 2007 acquisition of MediaTransfer, which contributed $5,262 in incremental revenue in fiscal 2008.

European revenue for fiscal 2008 included a favorable impact of $2,546 as a result of foreign exchange rate differences and the depreciation of the U.S. Dollar against the British Pound and the Euro.

Cost of services.  Cost of services was $140,578 or 58.9% of total revenue for fiscal 2008, compared with $122,052 or 57.6% of total revenue for fiscal 2007. Cost of services was principally impacted by the increase in revenue from services discussed above, as well as the differing types of custom research projects performed in fiscal 2008 compared with fiscal 2007. Additionally, cost of services was favorably impacted by the $800 reduction in our reserve for obligations with respect to future redemption of outstanding points under our HIpoints program discussed above.

Selling, general and administrative.  Selling, general and administrative expense increased to $83,084 or 34.8% of total revenue for fiscal 2008, compared with $72,590 or 34.3% of total revenue for fiscal 2007. Selling, general and administrative expense was principally impacted by $13,572 in incremental expenses attributable to our MediaTransfer, Decima and Marketshare acquisitions.

Depreciation and amortization.  Depreciation and amortization was $8,526 or 3.6% of total revenue for fiscal 2008, compared with $5,295 or 2.5% of total revenue for fiscal 2007. The increase in depreciation and amortization was principally the result of $2,960 in incremental depreciation and amortization expense attributable to our MediaTransfer, Decima and Marketshare acquisitions.

Gain on sale of assets.  There were no gains on the sale of assets for fiscal 2008. Gain on sale of assets during fiscal 2007 consisted of a $410 gain realized on the December 2006 sale of our Stockport facility, along with $378 in net proceeds from the June 2007 sale of two internally developed patents.

Restructuring and other charges.  See above under “Restructuring and Other Charges” for a discussion of restructuring charges incurred during fiscal 2008 and 2007.

Goodwill impairment charge.  See above under “Goodwill Impairment Charges” for a discussion of the goodwill impairment charge incurred during fiscal 2008.

Interest and other income.  Interest and other income was $1,119 or 0.5% of total revenue for fiscal 2008, compared with $2,246 or 1.1% of total revenue for fiscal 2007. The decrease in interest

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and other income was due to a decrease in the average balance of cash and marketable securities for fiscal 2008 when compared with fiscal 2007.

Interest expense.  Interest expense was $1,951 or 0.8% of total revenue for fiscal 2008, compared with $290 or 0.1% of total revenue for fiscal 2007. The increase in interest expense was the result of our outstanding debt in fiscal 2008 compared with fiscal 2007, during which we did not have any outstanding debt for the first nine months of the fiscal year. The debt incurred was used to fund a portion of the consideration for our MediaTransfer acquisition in fiscal 2007, and our Decima and Marketshare acquisitions in fiscal 2008.

Income taxes.  We recorded an income tax benefit from continuing operations of $(661) for fiscal 2008, compared with an income tax provision of $5,319 for fiscal 2007. This was principally impacted by a $2,400 tax charge which resulted from the goodwill impairment charge discussed above, which was largely non deductible for tax purposes. For further explanation of our actual tax rate for fiscal 2008 compared with our U.S. statutory rate, see Note 16, “Income Taxes,” to our consolidated financial statements contained in this Form 10-K.

Significant Factors Affecting Company Performance

Our Revenue Mix

In reports filed with the SEC for periods prior to the fiscal quarter ended December 31, 2008, in addition to reporting revenue from services, we provided detail as to the portion of revenue that was Internet-based. We treated all of the revenue from a project as Internet-based whenever more than 50% of the data collection for that project was completed online. During the periods in which we were one of the few providers of Internet-based market research, an understanding of Internet-based revenue was helpful in understanding the speed of conversion of clients to the Internet and our growth prospects. Costs related to Internet data collection also are different than those related to traditional methods of data collection, so an understanding of our Internet-based revenue was helpful in comparing our margins with those of others in the market research industry. Internet-based research now has gained wide market acceptance, both with providers and clients, and is less a differentiating factor for us than it historically was. Moreover, the percentage of our revenue in the United States that is Internet-based has stabilized within a range of 65-75% of total U.S. revenue during the most recent fiscal years, and the percentage of our revenue generated in Europe has grown to be within a similar range. Rather than focusing on Internet-based revenue growth, our current business model emphasizes utilizing the most efficient and effective data collection method for the specific project, whether Internet-based, traditional, or otherwise. Therefore, we no longer believe that separate reporting of Internet-based revenue provides materially helpful information to investors, and discontinued separate reporting of that metric for periods after December 31, 2008.

Our Ability to Measure Our Performance

We closely track certain key operating metrics, specifically bookings and ending sales backlog. These key operating metrics enable us to measure the current and forecasted performance of our business relative to historical trends. In prior periods, we have also reported days of sales outstanding, utilization and average billable full-time equivalents. We are no longer reporting these metrics and have limited the metrics reported below to those that we believe are most useful to investors in tracking trends within our business.

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Key operating metrics for continuing operations, by quarter, for the fiscal years ended June 30, 2008 and 2009, were as follows (U.S. Dollar amounts in millions):

	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
	FY2008		FY2008		FY2008		FY2008		FY2009		FY2009		FY2009		FY2009
Cash & marketable securities	$	24.1	$	33.3	$	31.2	$	32.9	$	25.2	$	26.1	$	16.9	$	17.8
Bookings	$	50.8	$	68.2	$	61.3	$	53.3	$	43.5	$	48.6	$	37.9	$	36.3
Ending sales backlog	$	67.4	$	72.8	$	76.9	$	66.8	$	60.1	$	58.0	$	56.0	$	48.8

Additional information regarding each of the key operating metrics noted above is as follows:

Bookings are defined as the contract value of revenue-generating projects that are anticipated to take place during the next four fiscal quarters for which a firm client commitment was received during the current period, less any adjustments to prior period bookings due to contract value adjustments or project cancellations during the current period.

Bookings for the three months ended June 30, 2009 were $36.3 million, compared with $53.3 million for the same prior year period. The decrease in bookings was principally impacted by the challenging global macroeconomic conditions discussed above under “Risks Related to Our Business.”

Monitoring bookings enhances our ability to forecast long-term revenue and to measure the effectiveness of our marketing and sales initiatives. However, we also are mindful that bookings often vary significantly from quarter to quarter. Information concerning our new bookings is not comparable to, nor should it be substituted for, an analysis of our revenue over time. There are no third-party standards or requirements governing the calculation of bookings. New bookings involve estimates and judgments regarding new contracts and renewals, as well as extensions and additions to existing contracts. Subsequent cancellations, extensions and other matters may affect the amount of bookings previously reported.

Ending Sales Backlog is defined as prior period ending sales backlog plus current period bookings, less revenue recognized on outstanding projects as of the end of the period.

Ending sales backlog helps us manage our future staffing levels more accurately and is also an indicator of the effectiveness of our marketing and sales initiatives. Generally, projects included in ending sales backlog at the end of a fiscal period convert to revenue from services during the following twelve months, based on our experience from prior years. However, it is unclear what effect current global macroeconomic conditions will have on the conversion of backlog to revenue over the next few quarters, as projects currently in backlog remain subject to cancellation if the project has not already commenced.

Ending sales backlog for the three months ended June 30, 2009 was $48.8 million, compared with $66.8 million for the same prior year period. The decrease in ending sales backlog was principally impacted by the challenging global macroeconomic conditions discussed above under “Risks Related to Our Business”.

Liquidity and Capital Resources

Cash and Cash Equivalents

The following table sets forth net cash provided by (used in) operating activities, net cash provided by (used in) investing activities and net cash provided by (used in) financing activities, for the fiscal years ended June 30:

	2009			2008			2007
Net cash provided by (used in) operating activities	$	(4,334	)	$	17,972		$	16,639
Net cash provided by (used in) investing activities		(2,256	)		(20,813	)		28,800
Net cash provided by (used in) financing activities		(8,015	)		6,436			(28,251	)

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Net cash provided by (used in) operating activities.  Net cash used in operating activities was $(4,334) for fiscal 2009, compared with $17,972 provided by operating activities for fiscal 2008. The change from fiscal 2008 was principally the result of our net loss for fiscal 2009 and decreases in accounts payable and accrued expenses, many of which are project-related and were impacted by current fiscal year revenue declines, partially offset by decreases in accounts receivable and unbilled receivables.

Net cash provided by operating activities increased to $17,972 for fiscal 2008, compared with $16,639 for fiscal 2007. The increase in net cash provided by operating activities was primarily the result of the cash contributed from the operations of MediaTransfer, Decima and Marketshare.

Net cash provided by (used in) investing activities.  Net cash used in investing activities was $(2,256) for fiscal 2009, compared with $(20,813) for fiscal 2008. This change was principally the result of having no cash outlay for acquisitions during fiscal 2009, compared with $21,727 used during fiscal 2008 for acquisitions, and $1,015 in net purchases of marketable securities during the fiscal 2009, compared with net proceeds from the maturities and sales of marketable securities of $4,420 for fiscal 2008.

Net cash used in investing activities was $(20,813) for fiscal 2008, compared with $28,800 in net cash provided by investing activities for fiscal 2007. When compared with fiscal 2007, this change was principally the result of $21,727 in net cash used for acquisitions, compared with $9,790 used in fiscal 2007, along with a decline in net proceeds generated from maturities and sales of marketable securities from $40,831 in fiscal 2007 to $4,420 in fiscal 2008.

Net cash provided by (used in) financing activities.  Net cash used in financing activities was $(8,015) for fiscal 2009, compared with $6,436 provided by financing activities for fiscal 2008. This change was partially the result of having no borrowings during fiscal 2009, compared with $14,525 in net borrowings for fiscal 2008, and a $1,723 decrease in repayments of outstanding borrowings for fiscal 2009 when compared with fiscal 2008. In addition, fiscal 2009 included $1,274 in cash used to pay the costs associated with the amendments to our credit agreement discussed below under “Credit Facilities”.

Net cash provided by financing activities was $6,436 for fiscal 2008, compared with $(28,251) used in financing activities for fiscal 2007. This change was the result of $14,525 in net proceeds from borrowings, which were used to fund a portion of the consideration for our acquisitions of Decima and Marketshare, partially offset by $8,648 in payments on outstanding borrowings. Comparatively, $50,540 was used during fiscal 2007 to fund repurchases of our common stock under our Share Repurchase Program, which expired on December 31, 2007. The Share Repurchase Program was not renewed, and no purchases were made under it after fiscal 2007.

Working Capital

At June 30, 2009, we had cash, cash equivalents, and marketable securities of $17,762, compared with $32,874 at June 30, 2008. Available sources of cash to support known or reasonably likely cash requirements over the next 12 months include cash, cash equivalents and marketable securities on hand at June 30, additional cash that may be generated from our operations and funds to the extent available through our credit facilities discussed below. Until we achieve leverage ratios specified in our amended credit facility, we must have minimum cash balances ranging between 1.2 and 1.5 times the amount of borrowings we make under the revolving line that is part of our amended credit facilities. While we believe that our available sources of cash will support known or reasonably likely cash requirements over the next 12 months, our ability to generate cash from our operations is dependent upon the factors discussed below.

Generating cash from our operations significantly depends on our ability to profitably generate revenue, which requires that we continually develop new business, both for growth and to replace completed projects. Although work for no one client constitutes more than 10% of our revenue, we

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have had to find significant amounts of replacement and additional revenue as client relationships and work for continuing clients change and will likely have to continue to do so in the future. Our ability to generate revenue depends not only on execution of our business plans, but also on general market factors outside of our control. As many of our clients treat all or a portion of their market research expenditures as discretionary, our ability to generate revenue is adversely impacted whenever there are adverse macroeconomic conditions in the markets we serve. As discussed above under “Risks Related to Our Business”, the adverse global macroeconomic environment has significantly impacted our operations during fiscal 2009. Industry analysts at Inside Research have indicated that these trends may continue to persist, given the expected decrease in market research spending described above under “Overview.”

Our capital requirements depend on numerous factors, including but not limited to, market acceptance of our services, the resources we allocate to the continuing development of new products and services, our technology infrastructure and online panel, and the marketing and selling of our services. Our capital expenditures are not expected to exceed $4,500 for fiscal 2010.

Credit Facilities

On September 21, 2007, we entered into a Credit Agreement (the “2007 Credit Agreement”) with JPMorgan Chase Bank, N.A. (“JPMorgan”), as Administrative Agent, and the Lenders party thereto, pursuant to which the Lenders made available certain credit facilities. As of December 31, 2008, we were in violation of the leverage and interest coverage covenants under the terms of the 2007 Credit Agreement. We obtained a 30-day waiver of the covenant violations from the Lenders on February 5, 2009, and in connection with the waiver, the 2007 Credit Agreement was amended (the “First Amendment”). We obtained an additional 60-day extension of the waiver on March 6, 2009, and in connection with the waiver, the 2007 Credit Agreement was further amended in immaterial respects. On May 6, 2009 and effective as of that date, we entered into a further amendment (the “Second Amendment”) to the 2007 Credit Agreement, pursuant to which the prior covenant defaults were permanently waived and we were again in compliance with the terms of the 2007 Credit Agreement, as amended.

At June 30, 2009, we were in compliance with all of the covenants under the 2007 Credit Agreement, as amended.

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The Credit Agreement

The principal terms of the 2007 Credit Agreement, as amended, are described below:

2007 Credit Agreement	With Amendments
Availability:
$25,000 Revolving Line	$5,000 Revolving Line
• Up to $10,000 of Revolving Line may be used to back Letters of Credit	• Until certain leverage ratios are achieved, advances require minimum cash balances and no outstanding balance may exist at least 5 consecutive days in every 30-day period
• $25,000 Revolving Line increased availability at Lender discretion	• The Revolving Line may be used to back Letters of Credit
$12,000 Term Loan A	• No Revolving Line increased availability at Lender discretion
$19,825 Term Loan B	Term Loan A – unchanged
$2,900 Term Loan C	Term Loan B and C – consolidated but otherwise unchanged
$28,275 Term Loan additional availability at Company discretion	No additional Term Loan availability at Company discretion
Interest:
Company option:	Company option:
• Base Rate (greater of Federal Funds Rate plus 0.5% or Prime) plus 0.5%	• Base Rate (greater of Federal Funds Rate plus 0.5%, LIBOR plus 1%, or Prime) plus 4%
OR	OR
• LIBOR plus spread ranging between 0.625% and 1%, based upon leverage ratio	• LIBOR plus 4% under First Amendment and 5% under Second Amendment
The Company elected LIBOR option for Term Loans, and entered into interest swap agreement fixing LIBOR rate at 5.08% through September 21, 2012. With the spread, the effective rate on the Term Loans was 5.955% at December 31, 2008.	The Company election of LIBOR and interest swap agreement remained unchanged. With the spread, the effective rate on the Term Loans is 9.08% under the First Amendment, and 10.08% after the Second Amendment.
Interest payments are due at end of LIBOR interest periods, but at least quarterly in arrears	Payment schedule is unchanged
Unused Facility Fees:
Based upon leverage ratio, fee of between .10% and .175% of unused Revolving Line amount	Fee fixed at .5% of unused Revolving Line amount under the First Amendment, and 1.0% after the Second Amendment
Principal Payments:
Term Loan Maturity – September 21, 2012	Term Loan Maturity – unchanged
Revolving Line Maturity – September 21, 2012	Revolving Line Maturity – July 15, 2010
Revolving Line – payable at maturity	Revolving Line and Term Loan payment schedules are unchanged
Quarterly Term Loan Payments:
• Term Loan A – $600 quarterly
• Term Loan B – $991 quarterly
• Term Loan C – $140 quarterly

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2007 Credit Agreement	With Amendments
Financial Covenants:
Minimum Consolidated Interest Coverage Ratio of 3.00:1.0 Maximum Consolidated Leverage Ratio of 2.50:1.0	Minimum Consolidated Interest Coverage Ratio ranging over various quarters between 3.00:1.0 and 1.75:1.0 Maximum Consolidated Leverage Ratio ranging over various quarters between 6.40:1.0 and 2.00:1.0 Minimum Consolidated Revenue (trailing 3 months) ranging over various quarters between $33,200 and $45,400
Collateral:
Unsecured	Secured by all domestic assets and 66% of equity interests in first tier foreign subsidiaries

The 2007 Credit Agreement, as amended, contains customary representations, default provisions, and affirmative and negative covenants, including among others prohibitions of dividends, sales of certain assets and mergers, and restrictions related to acquisitions, indebtedness, liens, investments, share repurchases and capital expenditures. Among others, we may freely transfer assets and incur obligations among our domestic subsidiaries, but limitations apply to transfers of assets and loans to foreign subsidiaries.

The required principal repayments of Term Loans A and B (reflecting the consolidation of Term Loans B and C into Term Loan B) for each of the four succeeding fiscal years are set forth in Note 11, “Borrowings,” to our consolidated financial statements included in this Form 10-K. At June 30, 2009, we did not have any amounts outstanding under our revolving line of credit.

Interest Rate Swap

Effective September 21, 2007, we entered into an interest rate swap agreement with JPMorgan, which effectively fixed the floating LIBOR interest portion of the rates on the amounts outstanding under Term Loans A and B (including as Term Loans B and C were consolidated into Term Loan B) at 5.08% through September 21, 2012. The three-month LIBOR rate received on the swap matches the base rate paid on the term loan since both use three-month LIBOR. The swap had an initial notional value of $34,625 which declines as payments are made on Term Loans A and B so that the amount outstanding under those term loans and the notional amount of the swap are always equal. The interest rate swap had a notional amount of $22,506 at June 30, 2009, which was the same as the outstanding amount of the term loans. The applicable spreads referenced in the table above are added to the 5.08% rate fixed by the interest rate swap.

The terms of the interest rate swap remain unaffected by the First or Second Amendments. The interest rate swap continues to be accounted for in accordance with SFAS No. 133.

At June 30, 2009, we recorded a liability of $1,351 in the “Other liabilities” line item of our unaudited consolidated balance sheet to reflect the fair value of the interest rate swap. As a result of the covenant violations noted above, it was determined that the interest rate swap was not an effective cash flow hedge at both December 31, 2008 and March 31, 2009. Accordingly, we recorded charges to interest expense to reflect the ineffectiveness of the swap of $1,017 during the second and third quarters of fiscal 2009. At May 6, 2009, the swap was once again deemed an effective cash flow hedge, and continued to be effective at June 30, 2009. As such, changes in the fair value of the interest rate swap were once again recorded through other comprehensive income.

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Off-Balance Sheet Risk Disclosure

At June 30, 2009 and 2008, we did not have any transactions, agreements or other contractual arrangements constituting an “off-balance sheet arrangement” as defined in Item 303(a)(4) of Regulation S-K.

Contractual Obligations

Our consolidated contractual obligations and other commercial commitments at June 30, 2009 are as follows (amounts in thousands):

	Payments Due by Period
			Less than		1-3		3-5		More than
	Total		1 Year		Years		Years		5 Years
Long-term debt obligations	$	22,506	$	6,925	$	13,850	$	1,731	$	—
Interest obligations on long-term debt(1)		3,971		2,007		1,920		44		—
Capital lease obligations		—		—		—		—		—
Operating lease obligations		26,671		6,464		9,055		6,573		4,579
Purchase obligations		—		—		—		—		—
Other long-term liabilities(2)		441		29		155		59		198
Total	$	53,589	$	15,425	$	24,980	$	8,407	$	4,777

(1)	Interest obligations shown above were derived using an interest rate of 10.08%. This rate is a combination of the 5.08% that is fixed by our interest rate swap, and the 5.00% additional spread applicable to our leverage ratio. These rates are more fully described in Note 11, “Borrowings,” to the consolidated financial statements contained in this Form 10-K.
(2)	Amounts in the “1-3 Years” category include $96 for liabilities associated with uncertain tax positions, determined in accordance with FASB Interpretation No. 48, as more fully described in Note 16, “Income Taxes,” to the consolidated financial statements contained in this Form 10-K.

Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted

See “Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted” in Note 2, “Summary of Significant Accounting Policies,” to our consolidated financial statements contained in this Form 10-K for a discussion of the impact of recently issued accounting pronouncements on our consolidated financial statements at June 30, 2009, for the fiscal year then ended, as well as the expected impact on our consolidated financial statements for future periods.

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk

We have two kinds of market risk exposures, interest rate exposure and foreign currency exposure. We have no market risk sensitive instruments entered into for trading purposes.

In light of recent economic conditions, we reviewed the cash equivalents and marketable securities held by us. We do not believe that our holdings have a material liquidity risk under current market conditions.

Interest Rate Exposure

At June 30, 2009, we had outstanding debt under our credit facilities of $22,506. The debt matures September 21, 2012 and bears interest at the floating adjusted LIBOR plus an applicable margin. On September 21, 2007, we entered into an interest rate swap agreement, which fixed the floating adjusted LIBOR portion of the interest rate at 5.08% through September 21, 2012. The

43

additional applicable margin was fixed at four percentage points in the First Amendment and five percentage points in the Second Amendment. The terms of the interest rate swap remain unchanged by the First or Second Amendments.

Using a sensitivity analysis based on a hypothetical 1% increase in prevailing interest rates over a 12-month period, each 1% increase from prevailing interest rates at June 30, 2009 would have increased the fair value of the interest rate swap by $338 and each 1% decrease from prevailing interest rates at June 30, 2009 would have decreased the fair value of the interest rate swap by $356.

Foreign Currency Exposure

As a result of operating in foreign markets, our financial results could be affected by factors such as changes in foreign currency exchange rates. We have international sales and operations in Europe, North America, and Asia. Therefore, we are subject to foreign currency rate exposure. Non-U.S. transactions are denominated in the functional currencies of the respective countries in which our foreign subsidiaries reside. Our consolidated assets and liabilities are translated into U.S. Dollars at the exchange rates in effect as of the balance sheet date. Consolidated income and expense items are translated into U.S. Dollars at the average exchange rates for each period presented. Accumulated net translation adjustments are recorded in the accumulated other comprehensive income component of stockholders’ equity. We measure our risk related to foreign currency rate exposure on two levels, the first being the impact of operating results on the consolidation of foreign subsidiaries that are denominated in the functional currency of their home country, and the second being the extent to which we have instruments denominated in a foreign currency.

Foreign exchange translation gains and losses are included in our results of operations as a result of consolidating the results of our international operations, which are denominated in each country’s functional currency, with our U.S. results. The impact of translation gains or losses on net income from consolidating foreign subsidiaries was not material for the periods presented. We have historically had low exposure to changes in foreign currency exchange rates upon consolidating the results of our foreign subsidiaries with our U.S. results, due to the size of our foreign operations in comparison to our consolidated operations. However, if the operating profits of our international operations increase, our exposure to the appreciation or depreciation in the U.S. Dollar could have a more significant impact on our net income and cash flows. Thus, we evaluate our exposure to foreign currency fluctuation risk on an ongoing basis.

Since our foreign operations are conducted using a foreign currency, we bear additional risk of fluctuations in exchange rates because of instruments denominated in a foreign currency. We have historically had low exposure to changes in foreign currency exchange rates with regard to instruments denominated in a foreign currency, given the amount and short-term nature of the maturity of these instruments. The carrying values of financial instruments denominated in a foreign currency, including cash, cash equivalents, accounts receivable and accounts payable, approximate fair value because of the short-term nature of the maturity of these instruments.

We performed a sensitivity analysis at June 30, 2009. Holding all other variables constant, we have determined that the impact of a near-term 10% appreciation or depreciation of the U.S. Dollar would have an insignificant effect on our financial condition, results of operations and cash flows.

44

Item 8.   Financial Statements and Supplementary Data

Index to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm	46
Consolidated Balance Sheets at June 30, 2009 and 2008	47
Consolidated Statements of Operations for the years ended June 30, 2009, 2008 and 2007	48
Consolidated Statements of Cash Flows for the years ended June 30, 2009, 2008 and 2007	49
Consolidated Statements of Changes in Stockholders’ Equity for the years ended June 30, 2009, 2008 and 2007	50
Notes to Consolidated Financial Statements (including unaudited quarterly results of operations)	51
Index to Financial Statement Schedules	91
Schedule II — Valuation and Qualifying Accounts	95

All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable and have therefore been omitted.

45

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Harris Interactive Inc.

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of Harris Interactive Inc. and its subsidiaries at June 30, 2009 and 2008, and the results of their operations and their cash flows for each of the three years in the period ended June 30, 2009 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for uncertain tax positions in 2008.

/s/ PricewaterhouseCoopers LLP

Rochester, New York

August 31, 2009

46

HARRIS INTERACTIVE INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	June 30,			June 30,
	2009			2008
ASSETS
Current assets:
Cash and cash equivalents	$	16,752		$	32,874
Marketable securities		1,010			—
Accounts receivable, less allowances of $779 and $482, respectively		23,163			34,940
Unbilled receivables		6,520			11,504
Prepaid expenses and other current assets		7,244			8,753
Deferred tax assets		632			3,959
Total current assets		55,321			92,030
Property, plant and equipment, net		8,015			11,953
Goodwill		—			42,805
Other intangibles, net		18,540			23,302
Deferred tax assets		284			14,606
Other assets		2,367			2,353
Total assets	$	84,527		$	187,049
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	6,738		$	10,779
Accrued expenses		18,349			25,611
Current portion of outstanding debt		6,925			6,925
Deferred revenue		12,531			16,226
Total current liabilities		44,543			59,541
Long-term debt		15,581			22,506
Deferred tax liabilities		3,163			4,035
Other long-term liabilities		3,117			2,331
Commitments and contingencies (Note 19)
Stockholders’ equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized; 0 shares issued and outstanding at June 30, 2009 and 2008		—			—
Common stock, $.001 par value, 100,000,000 shares authorized; 53,964,482 shares issued and outstanding at June 30, 2009 and 53,783,980 shares issued and outstanding at June 30, 2008		54			54
Additional paid-in capital		184,860			182,709
Accumulated other comprehensive income		3,347			10,680
Accumulated deficit		(170,138	)		(94,807	)
Total stockholders’ equity		18,123			98,636
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	84,527		$	187,049

The accompanying notes are an integral part of these consolidated financial statements.

47

HARRIS INTERACTIVE INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

	For the Years Ended June 30,
	2009			2008			2007
Revenue from services	$	184,334		$	238,723		$	211,803
Operating expenses:
Cost of services		115,235			140,578			122,052
Selling, general and administrative		65,678			83,084			72,590
Depreciation and amortization		7,610			8,526			5,295
Gain on sale of assets		—			—			(788	)
Restructuring and other charges		12,010			4,609			337
Goodwill impairment charge		40,250			86,497			—
Total operating expenses		240,783			323,294			199,486
Operating income (loss)		(56,449	)		(84,571	)		12,317
Interest and other income		400			1,119			2,246
Interest expense		(3,433	)		(1,951	)		(290	)
Income (loss) from continuing operations before income taxes		(59,482	)		(85,403	)		14,273
Provision (benefit) for income taxes		15,849			(661	)		5,319
Income (loss) from continuing operations		(75,331	)		(84,742	)		8,954
Income from discontinued operations, net of provision for income taxes		—			124			122
Net income (loss)	$	(75,331	)	$	(84,618	)	$	9,076
Basic net income (loss) per share:
Continuing operations	$	(1.41	)	$	(1.60	)	$	0.16
Discontinued operations		—			0.00			0.00
Basic net income (loss) per share	$	(1.41	)	$	(1.60	)	$	0.16
Diluted net income (loss) per share:
Continuing operations	$	(1.41	)	$	(1.60	)	$	0.16
Discontinued operations		—			0.00			0.00
Diluted net income (loss) per share	$	(1.41	)	$	(1.60	)	$	0.16
Weighted-average shares outstanding — basic		53,547,670			52,861,354			56,133,355
Weighted-average shares outstanding — diluted		53,547,670			52,861,354			56,397,600

The accompanying notes are an integral part of these consolidated financial statements.

48

HARRIS INTERACTIVE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	For the Years Ended June 30,
	2009			2008			2007
Cash flows from operating activities:
Net income (loss)	$	(75,331	)	$	(84,618	)	$	9,076
Adjustments to reconcile net income to net cash provided by operating activities —
Depreciation and amortization		9,125			10,042			6,783
Deferred taxes		16,831			(1,702	)		2,764
Stock-based compensation		1,965			4,091			3,787
Goodwill impairment charge		40,250			86,497			—
401(k) stock-based matching contribution		—			951			1,298
Bad debt expense		532			548			—
Amortization of deferred financing costs		479			114			—
Amortization of premium (discount) on marketable securities		4			—			(37	)
Gain on sale of discontinued operations and assets held for sale		—			(220	)		(788	)
Loss on disposal of fixed assets		—			—			103
(Increase) decrease in assets, net of acquisitions —
Accounts receivable		9,339			4,888			1,149
Unbilled receivables		4,199			918			649
Prepaid expenses and other current assets		(235	)		(2,529	)		(2,952	)
Other assets		(559	)		(241	)		322
(Decrease) increase in liabilities, net of acquisitions —
Accounts payable		(2,307	)		(352	)		(3,555	)
Accrued expenses		(6,096	)		1,292			(1,290	)
Deferred revenue		(3,326	)		(2,034	)		625
Other liabilities		796			388			(1,913	)
Net cash provided by (used in) operating activities of discontinued operations		—			(61	)		618
Net cash provided by (used in) operating activities		(4,334	)		17,972			16,639
Cash flows from investing activities:
Cash paid in connection with acquisitions, net of cash acquired		—			(21,727	)		(9,790	)
Purchase of marketable securities		(3,703	)		(15,000	)		(74,052	)
Proceeds from maturities and sales of marketable securities		2,688			19,420			114,883
Capital expenditures		(1,241	)		(3,704	)		(3,879	)
Proceeds from sale of discontinued operations and assets held for sale		—			219			1,652
Net cash (used in) investing activities of discontinued operations		—			(21	)		(14	)
Net cash provided by (used in) investing activities		(2,256	)		(20,813	)		28,800
Cash flows from financing activities:
Increases in borrowings, net of financing costs		—			14,525			19,625
Credit agreement amendment financing costs		(1,274	)		—			—
Repayments of borrowings		(6,925	)		(8,648	)		—
Repurchases of common stock		—			—			(50,540	)
Proceeds from exercise of employee stock options and employee stock purchases		184			526			2,246
Excess tax benefits from share-based payment awards		—			33			418
Net cash provided by (used in) financing activities		(8,015	)		6,436			(28,251	)
Effect of exchange rate changes on cash and cash equivalents		(1,517	)		368			258
Net increase (decrease) in cash and cash equivalents		(16,122	)		3,963			17,446
Cash and cash equivalents at beginning of period		32,874			28,911			11,465
Cash and cash equivalents at end of period	$	16,752		$	32,874		$	28,911

The accompanying notes are an integral part of these consolidated financial statements.

49

HARRIS INTERACTIVE INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands)

										Accumulated			Retained
	Common Stock						Additional			Other			Earnings			Total
	Outstanding						Paid-in			Comprehensive			(Accumulated			Stockholders’
	Shares			Amount			Capital			Income (Loss)			Deficit)			Equity
Balance at June 30, 2006		60,833		$	61		$	219,954		$	2,963		$	(19,334	)	$	203,644
Comprehensive income:
Net income														9,076			9,076
Unrealized gain on marketable securities											90						90
Foreign currency translation											2,362						2,362
Total comprehensive income																	11,528
Adjustment for initial implementation of SFAS No. 158											(23	)					(23	)
Issuance of stock for restricted stock grants and exercise of options		678						1,638									1,638
Issuance of common stock under Employee Stock Purchase Plan		142						606									606
Issuance of common stock under 401(k) Plan		229						1,298									1,298
Income tax benefit on exercise of stock options								418									418
Stock-based compensation expense								3,787									3,787
Retirement of common stock repurchased through Share Repurchase Program		(9,048	)		(8	)		(50,532	)								(50,540	)
Balance at June 30, 2007		52,834		$	53		$	177,169		$	5,392		$	(10,258	)	$	172,356
Comprehensive income (loss):
Net loss														(84,618	)		(84,618	)
Change in fair value of interest rate swap, net of tax											(516	)					(516	)
Unrealized gain on marketable securities											7						7
Foreign currency translation											5,797						5,797
Total comprehensive (loss)																	(79,330	)
Adjustment for initial implementation of FIN No. 48														69			69
Issuance of stock for restricted stock grants and exercise of options		423			1			17									18
Issuance of common stock under Employee Stock Purchase Plan and U.K. Limited Share Incentive Plan		251						579									579
Issuance of common stock under 401(k) Plan		276						951									951
Income tax benefit (shortfall) on exercise of stock options								(98	)								(98	)
Stock-based compensation expense								4,091									4,091
Balance at June 30, 2008		53,784		$	54		$	182,709		$	10,680		$	(94,807	)	$	98,636
Comprehensive income (loss):
Net loss														(75,331	)		(75,331	)
Change in fair value of interest rate swap, net of tax											244						244
Actuarial loss on postretirement obligation											(61	)					(61	)
Unrealized gain on marketable securities											12						12
Foreign currency translation											(7,528	)					(7,528	)
Total comprehensive (loss)																	(82,664	)
Issuance of stock for restricted stock grants and exercise of options		(229	)					(4	)								(4	)
Issuance of common stock under Employee Stock Purchase Plan and U.K. Limited Share Incentive Plan		409						190									190
Stock-based compensation expense								1,965									1,965
Balance at June 30, 2009		53,964		$	54		$	184,860		$	3,347		$	(170,138	)	$	18,123

50

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended June 30, 2009, 2008 and 2007

(In thousands, except share and per share amounts)

1.   Description of Business

Harris Interactive Inc. (the “Company”) is a leading global custom market research firm that uses online, telephone and other research methodologies to provide clients with information about the views, behaviors and attitudes of people worldwide.

2.   Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the assets, liabilities and results of operations of the Company and its wholly-owned subsidiaries. There are no unconsolidated entities or off-balance sheet arrangements. All intercompany accounts and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, if any, at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Subsequent Events

The Company has evaluated subsequent events for recognition or disclosure in the financial statements through the date of issuance, August 31, 2009.

Reclassifications

It is the Company’s policy to reclassify amounts in prior years’ consolidated financial statements to conform to the current year’s presentation. During the third quarter of fiscal 2009, the Company reviewed the presentation of its financial statements and decided to make two changes within its consolidated statements of operations, specifically:

•  Inclusion of unbillable professional staff time in “Cost of services” — In prior periods, the costs associated with professional staff time that were not directly billable to a client project were reclassified to the “Selling, general and administrative” expense line. These costs are now included in “Cost of services,” as the Company believes that this presentation best reflects the direct cost associated with its professional staff. All prior periods presented herein have been reclassified to conform with current period presentation.

•  Elimination of “Sales and marketing” expense line — Expenses from selling and marketing activities are now included within the “Selling, general and administrative” expense line. As the Company has streamlined its selling process to place greater emphasis on involving professional staff in its selling efforts, it no longer believes that separately presenting expenses associated with its selling efforts provides meaningful information for investors. All prior periods presented herein have been reclassified to conform with current period presentation.

These changes were designed to ensure that the Company’s financial statements can be more easily analyzed against the Company’s peer group, and to ensure that they are presented in a manner consistent with how the current management team manages the business.

51

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

The impact of the changes described above to “Cost of services” and “Selling, general and administrative” expense for the periods presented is shown below:

	June 30,			June 30,
	2008			2007
Cost of services:
Previously reported	$	120,192		$	104,761
Reclassification of unbillable professional staff time		20,386			17,291
As reclassified	$	140,578		$	122,052
Selling, general and administrative:
Previously reported	$	104,232		$	89,881
Reclassification of unbillable professional staff time		(20,386	)		(17,291	)
Reclassification of contractually obligated payment to senior executive (see Note 4)		(762	)		—
As reclassified	$	83,084		$	72,590

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid instruments with a remaining maturity of three months or less at date of purchase.

Marketable Securities

The Company accounts for its investments in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities. All investments have been classified as available-for-sale securities at June 30, 2009 and 2008. Available-for-sale securities are stated at fair value, with the unrealized gains and losses reported in accumulated other comprehensive income (loss). Realized gains and losses, as well as interest and dividends on available-for-sale securities, are included in interest and other income. The cost of securities sold is based on the specific identification method.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest. The collectibility of outstanding client invoices is continually assessed. The Company maintains an allowance for estimated losses resulting from the inability of clients to make required payments. In estimating the allowance, the Company considers factors such as historical collections, a client’s current creditworthiness, age of the receivable balance both individually and in the aggregate, and general economic conditions that may affect a client’s ability to pay.

Concentration of Credit Risk

Financial instruments which potentially expose the Company to concentrations of credit risk consist principally of accounts receivable and unbilled receivables. An allowance for doubtful accounts is provided for in the consolidated financial statements and is monitored by management to ensure that it is consistent with management’s expectations. Credit risk is limited with respect to accounts

52

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

receivable by the Company’s large client base. For fiscal years 2009, 2008 and 2007, no single client accounted for more than 10% of the Company’s consolidated revenue.

Property, Plant and Equipment

Property, plant and equipment, including improvements that significantly add to productive capacity or extend useful life, are recorded at cost. Maintenance and repairs are expensed as incurred. Upon sale or other disposition, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount, less proceeds from disposal, is charged or credited to income.

Depreciation is calculated using the straight-line or accelerated methods over the estimated useful lives of the assets. Estimated useful lives are as follows:

Computer equipment	3 years
Non-computer equipment	5 years
Furniture and fixtures	7 years

In accordance with SFAS No. 13, Accounting for Leases, leasehold improvements are amortized using the straight-line method over the lesser of estimated useful life of the assets or term of the underlying lease arrangements.

Business Combinations

Acquisitions are accounted for under the purchase method of accounting pursuant to SFAS No. 141, Business Combinations. Accordingly, the purchase price is allocated to the tangible assets and liabilities and intangible assets acquired, based on their estimated fair values. The excess purchase price over the fair value is recorded as goodwill. Identifiable intangible assets are valued separately and are amortized over their expected useful life.

Goodwill

SFAS No. 142, Goodwill and Other Intangible Assets, requires the Company to test goodwill for impairment on an annual basis and between annual tests in certain circumstances, and to write down goodwill and non-amortizable intangible assets when impaired. These assessments require the Company to estimate the fair market value of its single reporting unit. If the Company determines that the fair value of its reporting unit is less than its carrying amount, absent other facts to the contrary, an impairment charge must be recognized for the associated goodwill of the reporting unit against earnings in its consolidated financial statements. As the Company has one reportable segment, it utilizes the entity-wide approach for assessing goodwill.

Goodwill is evaluated for impairment using the two-step process as prescribed in SFAS No. 142. The first step is to compare the fair value of the reporting unit to the carrying amount of the reporting unit. If the carrying amount exceeds the fair value, a second step must be followed to calculate impairment. Otherwise, if the fair value of the reporting unit exceeds the carrying amount, the goodwill is not considered to be impaired as of the measurement date. To determine fair value for its reporting unit, the Company uses the fair value of the cash flows that its reporting unit can be expected to generate in the future. This valuation method requires management to project revenues, operating expenses, working capital investment, capital spending and cash flows for the reporting unit over a

53

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

multiyear period, as well as determine the weighted average cost of capital to be used as a discount rate.

Intangible Assets

The Company’s intangible assets are stated at cost less accumulated amortization and are amortized over estimated useful lives that range as follows:

Contract-based intangibles	2 to 4 years
Internet respondent database	2 to 9 years
Customer relationships	3 to 10 years
Trade names	0.5 to 20 years

The Company has no indefinite-lived intangible assets.

Computer Software Developed or Obtained for Internal Use

The Company follows the provisions of Statement of Position (“SOP”) 98-1, Accounting for Costs of Computer Software Developed or Obtained for Internal Use, issued by the American Institute of Certified Public Accountants, which addresses the accounting for the costs of computer software developed or obtained for internal use and identifies the characteristics of internal use software. Costs that satisfy the capitalization criteria prescribed in SOP 98-1 are included in other assets in the consolidated balance sheet and amounted to $2,480 and $2,612 at June 30, 2009 and 2008, respectively. Amortization expense related to these costs amounted to $1,515, $1,515, and $1,488 for the fiscal years ended June 30, 2009, 2008 and 2007, respectively.

Long-Lived Assets

In accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, the Company evaluates the recoverability of the carrying value of its long-lived assets, excluding goodwill, based on undiscounted cash flows to be generated from each of such assets compared to the original estimates used in measuring the assets.

Events that trigger a test for recoverability include material adverse changes in the projected revenues and expenses, significant underperformance relative to historical or projected future operating results, and significant negative industry or economic trends. A test for recoverability also is performed when the Company has committed to a plan to sell or otherwise dispose of an asset group and the plan is expected to be completed within a year. Recoverability of an asset group is evaluated by comparing its carrying value to the future net undiscounted cash flows expected to be generated by the asset group. If the comparison indicates that the carrying value of an asset group is not recoverable, an impairment loss is recognized. The impairment loss is measured by the amount by which the carrying amount of the asset group exceeds the estimated fair value. When an impairment loss is recognized for assets to be held and used, the adjusted carrying amount of those assets is depreciated over its remaining useful life. Restoration of a previously-recognized long-lived asset impairment loss is not allowed.

The Company estimates the fair value of an asset group based on market prices (i.e., the amount for which the asset could be bought by or sold to a third party), when available. When market prices are not available, the Company estimates the fair value of the asset group using the income approach and/or the market approach. The income approach uses cash flow projections. Inherent in the

54

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

Company’s development of cash flow projections are assumptions and estimates derived from a review of its operating results, approved business plans, expected growth rates and cost of capital, among others. The Company also makes certain assumptions about future economic conditions, interest rates, and other market data. Many of the factors used in assessing fair value are outside the control of management, and these assumptions and estimates can change in future periods.

Changes in assumptions or estimates could materially affect the determination of fair value of an asset group, and therefore could affect the amount of potential impairment of the asset. The following assumptions are key to the Company’s income approach:

•  Business Projections — The Company makes assumptions about the level of demand for its services in the marketplace. These assumptions drive the Company’s planning assumptions for revenue growth. The Company also makes assumptions about its cost levels. These assumptions are key inputs for developing the Company’s cash flow projections. These projections are derived using the Company’s internal business plans.

•  Growth Rate — The growth rate is the expected rate at which an asset group’s earnings stream is projected to grow beyond the planning period.

•  Economic Projections — Assumptions regarding general economic conditions are included in and affect the Company’s assumptions regarding revenue from services. These macroeconomic assumptions include inflation, interest rates and foreign currency exchange rates.

During the three months ended December 31, 2008, as a result of the factors discussed in Note 8, “Goodwill”, the Company tested its asset groups for recoverability under SFAS No. 144. As the projected undiscounted cash flows for the individual asset groups exceeded the carrying value of the long-lived assets for each asset group, the Company did not record an impairment charge for any of its long-lived assets during the three months ended December 31, 2008. No additional facts and circumstances arose during the remainder of fiscal 2009 to cause the Company to change this conclusion.

Fair Value of Financial Instruments

Effective July 1, 2008, the Company adopted SFAS No. 157, Fair Value Measurements, which defines fair value, establishes a fair value hierarchy and requires expanded disclosures about fair value measurements. The impact of adopting SFAS No. 157 was not material to the Company’s consolidated financial statements.

The Company also adopted SFAS No. 159, The Fair Value Option for Financial Assets and Liabilities — including an amendment of FASB Statement No. 115 as of July 1, 2008. SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value at specified election dates. The Company did not elect the fair value option for any financial assets and liabilities existing at July 1, 2008 which had not previously been carried at fair value. Therefore, the adoption of SFAS 159 has not impacted its consolidated financial statements. Any future transacted financial assets or liabilities will be evaluated for the fair value election as prescribed by SFAS No. 159.

The fair value of the Company’s cash equivalents and available for sale marketable securities is derived from quoted market prices for similar instruments, with all significant inputs derived from or corroborated by observable market data. The fair value of the Company’s interest rate swap was

55

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

based on quotes from the respective counterparty, which are corroborated by the Company using discounted cash flow calculations based upon forward interest-rate yield curves obtained from independent pricing services. The carrying value of the Company’s accounts receivable, accounts payable and accrued expenses approximate their fair value. The Company had $22,506 of outstanding debt at June 30, 2009 under its credit facilities, which is considered a financial instrument. The carrying amount of this debt approximates its fair value as the rate of interest on the Company’s term loans that are outstanding under its credit facilities reflect current market rates of interest for similar instruments with comparable maturities.

Derivative Financial Instruments

The Company uses an interest rate swap to manage the economic effect of the variable interest obligation on its outstanding debt under its credit agreement so that the interest payable on the outstanding debt effectively becomes fixed at a certain rate, thereby reducing the impact of future interest rate changes on the Company’s future interest expense. The Company accounts for its interest rate swap in accordance with SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. The Company records the fair value of the interest rate swap in its consolidated balance sheet with the effective portion of the related gain or loss deferred as a component of accumulated other comprehensive income. The deferred gains or losses are recognized in the Company’s consolidated statements of operations in the same period in which the underlying hedge items are recognized and on the same line item as the underlying hedged items. The Company evaluates the effectiveness of its interest rate swap as a cash flow hedge on a quarterly basis. To the extent that the interest rate swap is no longer effective, the Company recognizes the amount related to the ineffective portion in its consolidated statements of operations as interest expense.

On January 1, 2009, the Company adopted SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133. This Statement requires enhanced disclosures about an entity’s derivative and hedging activities.

Post-employment Payments

The Company has entered into employment agreements with certain of its executives which obligate the Company to make payments for varying periods of time and under terms and circumstances set forth in these agreements. In part, the payments are in consideration for obligations of the executives not to compete with the Company after termination of their employment, and in part, the payments relate to other relationships between the parties. The Company accounts for its obligations under these agreements in accordance with SFAS No. 112, Employers’ Accounting for Postemployment Benefits, an Amendment of FASB Statements No. 5 and 43.

Revenue Recognition

The Company recognizes revenue from services on a proportional performance basis. In assessing contract performance, both input and output criteria are reviewed. Costs incurred are used as an objective input measure of performance. The primary input of all work performed under these arrangements is labor. As a result of the relationship between labor and cost, there is normally a direct relationship between the costs incurred and the proportion of the contract performed to date. Costs incurred as an initial proportion of expected total costs is used as an initial proportional performance measure. This indicative proportional performance measure is always subsequently validated against more subjective criteria (i.e. relevant output measures) such as the percentage of

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

interviews completed, percentage of reports delivered to a client and the achievement of any project milestones stipulated in the contract. In the event of divergence between the objective and more subjective measures, the more subjective measures take precedence since these are output measures.

Clients are obligated to pay based upon services performed, and in the event that a client cancels the contract, the client generally is responsible for payment for services performed through the date of cancellation. Losses expected to be incurred, if any, on jobs in progress are charged to income as soon as it becomes probable that such losses will occur. Invoices to clients in the ordinary course are generated based upon the achievement of specific events, as defined by each contract, including deliverables, timetables, and incurrence of certain costs. Such events may not be directly related to the performance of services. Revenues earned on contracts in progress in excess of billings are classified as unbilled receivables. Amounts billed in excess of revenues earned are classified as deferred revenue.

In accordance with Emerging Issues Task Force (“EITF”) Issue No. 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent, revenue includes amounts billed to clients for subcontractor costs incurred in the completion of surveys. Revenue reflects reductions offered to clients in the form of rebates, in accordance with EITF Issue No. 01-09, Accounting for Consideration Given by a Vendor to a Customer or a Reseller of the Vendor’s Products. Reimbursements of out-of-pocket expenses related to service contracts are also included in revenue in accordance with EITF Issue No. 01-14, Income Statement Characterization of Reimbursements Received for “Out-of-Pocket” Expenses Incurred.

The Company’s policies are in compliance with the provisions of EITF Issue No. 00-21, Revenue Arrangements with Multiple Deliverables, which addresses certain aspects of the accounting by a vendor for arrangements under which it will perform multiple revenue-generating activities to determine if separate units of accounting exist in such arrangements.

Cost of Services

The Company’s direct costs of providing services principally consist of project personnel, which relate to the labor costs directly associated with a project, panelist incentives, which represent cash and non-cash incentives awarded to individuals who complete surveys, data processing, which represents both the internal and outsourced processing of survey data, and other direct costs related to survey production, including the amortization of software developed for internal use.

Panelist Incentives

In July 2001, the Company initiated HIpoints, a loyalty program designed to reward respondents who register for its panel, complete online surveys and refer others to join its online panel. The earned points are non-transferable and may be redeemed for gifts from a specific product portfolio at any time prior to expiration. The Company maintains a reserve for obligations with respect to future redemption of outstanding points based on the expected redemption rate of the points. This expected redemption rate is based on the Company’s actual redemption rates since the inception of the program.

Prior to December 2007, points under the HIpoints program expired after one year of account inactivity. In December 2007, the Company modified the expiration parameters of the program such that points now expire after nine months of account inactivity and tightened the rules around

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

expirations to more accurately account for panelists that are not truly engaged in the program. These changes resulted in an approximately $800 reduction in the Company’s reserve for obligations with respect to future redemption of outstanding points during the second quarter of fiscal 2008, which was recorded in the “Cost of services” line of the Company’s consolidated statement of operations.

In addition, certain of the Company’s panelists receive cash incentives for participating in surveys from the Company, which are earned by the panelist when the Company receives a timely survey response. The Company accrues these incentives as they are earned.

Advertising Expenses

Advertising costs are expensed as incurred and are included in selling, general and administrative expense in the accompanying consolidated statements of operations. Such expenses amounted to $1,511, $2,179, and $1,496 for the fiscal years ended June 30, 2009, 2008 and 2007, respectively.

Stock-Based Compensation

In December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123 (revised 2004) (“SFAS No. 123(R)”), Share-Based Payment. SFAS No. 123(R) replaced SFAS No. 123, Accounting for Stock-Based Compensation and superseded Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees. The Company adopted SFAS No. 123(R) on July 1, 2005 using the modified prospective approach. Under the modified prospective approach, stock-based compensation expense has been and will be recorded for the unvested portion of previously issued awards that remain outstanding at July 1, 2005 using the same estimate of the grant date fair value and the same attribution method used to determine the pro forma disclosure under SFAS No. 123. SFAS No. 123(R) also requires that all share-based payments to employees after July 1, 2005, including employee stock options and shares issued to employees under the Company’s Employee Stock Purchase Plans, be recognized in the financial statements as stock-based compensation expense based on their fair value on the date of grant using an option-pricing model, such as the Black-Scholes model. Accordingly, prior period amounts were not revised.

SFAS No. 123(R) requires that the Company estimate forfeitures when recognizing stock-based compensation expense and that this estimate of forfeitures be adjusted over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and also impact the amount of unamortized stock-based compensation expense to be recognized in future periods.

A deferred tax asset is recorded on the stock-based compensation expense required to be accrued under SFAS No. 123(R). A current income tax deduction arises at the time of vesting (restricted stock) or exercise (stock options). In the event the current income tax deduction is greater or less than the associated deferred tax asset, the difference is required under SFAS No. 123(R) to be charged first to the windfall tax benefit pool. In the event that there is not an adequate pool of windfall tax benefits, the shortfall is charged to expense. The Company elected to adopt the alternative method of calculating the historical pool of windfall benefits as permitted by FASB Staff Position No. 123(R)-c, Transition Election Related to Accounting for the Tax Effects of Share-Based Payment Awards. This is a simplified method to determine the pool of windfall benefits that is used in determining the tax effects of stock-based compensation in the results of operations and cash flow reporting for awards that were outstanding as of the adoption of SFAS No. 123(R).

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

Income Taxes

The Company follows the asset and liability approach to account for income taxes in accordance with SFAS No. 109, Accounting for Income Taxes, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of operating loss carryforwards and temporary differences between the carrying amounts and the tax bases of assets and liabilities. The Company has not provided U.S. deferred income taxes applicable to the unremitted earnings of its foreign subsidiaries, as these amounts are considered to be indefinitely reinvested outside the U.S.

On July 1, 2007, the Company adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (“FIN No. 48”), which contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return. The Company first determines if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is that the Company measures the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. FIN No. 48 also required the Company to reclassify the majority of its uncertain tax positions from current to non-current in fiscal 2008. FIN No. 48 does not allow for retroactive treatment or presentation. The Company has recognized interest and penalties related to uncertain tax positions in the provision for income taxes line of its consolidated statements of operations.

Net Income (Loss) Per Share

In accordance with SFAS No. 128, Earnings Per Share, basic net income (loss) per share amounts are computed based on the weighted-average number of shares of common stock outstanding during the year. Diluted net income (loss) per share reflects the assumed exercise and conversion of employee stock options that have an exercise price that is below the average market price of the common shares for the respective periods. The treasury stock method is used in calculating diluted shares outstanding whereby assumed proceeds from the exercise of stock options, net of average unrecognized stock-based compensation expense for stock options and restricted stock, and the related tax benefit are assumed to be used to repurchase common stock at the average market price during the period.

Foreign Currency Translation

For the Company’s subsidiaries located outside of the United States, the local currency is the functional currency. In accordance with SFAS No. 52, Foreign Currency Translation, the financial statements of those subsidiaries are translated into U.S. Dollars as follows. Consolidated assets and liabilities are translated at the exchange rates in effect at the balance sheet date. Consolidated income, expenses and cash flows are translated at the average exchange rates for each period and stockholders’ equity is translated using historical exchange rates. The resulting translation adjustment is recorded as a component of accumulated other comprehensive income (loss) in the accompanying consolidated balance sheets.

Comprehensive Income (Loss)

The Company accounts for comprehensive income (loss) in accordance with SFAS No. 130, Reporting Comprehensive Income. Comprehensive income (loss) consists of two components, net income (loss) and accumulated other comprehensive income (loss). Accumulated other

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

comprehensive income (loss) refers to revenue, expenses, gains and losses that, under generally accepted accounting principles, are recorded as an element of stockholders’ equity but are excluded from net income. The Company’s accumulated other comprehensive income (loss) is comprised of the unrealized holding gain (loss) on available-for-sale marketable securities and the foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency.

Segment Reporting

The Company reports segment information in accordance with SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information. The Company operates a globally consistent business model, offering custom market research to its customers in the geographic regions in which it operates. Geographic management facilitates local execution of the Company’s global strategies. However, the Company maintains global leaders for the majority of its critical business processes, and the most significant performance evaluations and resource allocations made by the Company’s chief operating decision-maker are made on a global basis. Accordingly, the Company has concluded that it has one reportable segment.

Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted

SFAS No. 157

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. In February 2008, the FASB issued FASB Staff Position No. 157-2, Effective Date of FASB Statement No. 157, which provides a one year deferral of the effective date of SFAS No. 157 for non-financial assets and non-financial liabilities, except those that are recognized or disclosed in the financial statements at fair value at least annually. The Company adopted SFAS No. 157 for its financial assets and liabilities on July 1, 2008, and the effect of adoption was not material, resulting only in increased disclosures (see Note 5, “Fair Value Measurements”). The Company adopted SFAS No. 157 on July 1, 2009 for its non-financial assets and non-financial liabilities. Adoption of SFAS No. 157 did not have a material impact on the Company’s consolidated financial statements.

SFAS No. 141(R)

In December 2007, the FASB issued SFAS No. 141 (revised 2007) (“SFAS No. 141(R)”), Business Combinations, which replaces SFAS No. 141. SFAS No. 141(R) establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non controlling interest in the acquiree and the goodwill acquired. SFAS No. 141(R) also establishes disclosure requirements that will enable users to evaluate the nature and financial effects of the business combination. SFAS No. 141(R) is effective as of the beginning of an entity’s fiscal year that begins after December 15, 2008. The Company adopted SFAS No. 141(R) on July 1, 2009 and will apply SFAS No. 141(R) when accounting for future business combinations.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

SFAS No. 160

In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements — amendments of ARB No. 51. SFAS No. 160 states that accounting and reporting for minority interests will be recharacterized as noncontrolling interests and classified as a component of equity. SFAS No. 160 also establishes reporting requirements that provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS No. 160 applies to all entities that prepare consolidated financial statements, except not-for-profit organizations, but will affect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. SFAS No. 160 is effective as of the beginning of an entity’s first fiscal year beginning after December 15, 2008. The Company adopted SFAS No. 160 on July 1, 2009. Adoption of SFAS No. 160 did not have a material impact on the Company’s consolidated financial statements.

SFAS No. 161

In March 2008, the FASB issued SFAS No. 161.  SFAS No. 161 requires companies with derivative instruments to disclose information that should enable financial statement users to understand how and why a company uses derivative instruments, how derivative instruments and related hedged items are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, and how derivative instruments and related hedged items affect a company’s financial position, financial performance and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The Company adopted SFAS No. 161 on January 1, 2009. Adoption of SFAS No. 161 did not have a material impact on the Company’s consolidated financial statements, as discussed in Note 12, “Derivative Financial Instruments”.

SFAS No. 162

In May 2008, the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles. The new standard is intended to improve financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with generally accepted accounting principles for nongovernmental entities in the United States. Adoption of SFAS No. 162 did not have a material impact on the Company’s consolidated financial statements.

SFAS No. 163

In May 2008, the FASB issued SFAS No. 163, Accounting for Financial Guarantee Insurance Contracts — An interpretation of FASB Statement No. 60. SFAS No. 163 requires that an insurance enterprise recognize a claim liability prior to an event of default when there is evidence that credit deterioration has occurred in an insured financial obligation. It also clarifies how SFAS No. 60, Accounting and Reporting by Insurance Enterprises, applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities, and requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008. The Company adopted SFAS No. 163 on July 1, 2009. Adoption of SFAS No. 163 did not have a material impact on the Company’s consolidated financial statements.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

2.   Summary of Significant Accounting Policies — (Continued)

SFAS No. 165

In May 2009, the FASB issued SFAS No. 165, Subsequent Events. SFAS No. 165 introduces the concept of financial statements being available to be issued and requires the disclosure of the date through which an entity has evaluated subsequent events and the basis for that date. SFAS No. 165 is effective for reporting periods ending after June 15, 2009. The Company adopted SFAS No. 165 on June 30, 2009. Adoption of SFAS No. 165 did not have a material impact on the Company’s consolidated financial statements.

SFAS No. 166

In June 2009, the FASB issued SFAS No. 166, Accounting for Transfers of Financial Assets an amendment of FASB Statement No. 140, which amends the derecognition guidance in FASB Statement No. 140 and eliminates the exemption from consolidation for qualifying special-purpose entities. This statement is effective for financial asset transfers occurring after the beginning of an entity’s first fiscal year that begins after November 15, 2009. The Company will adopt SFAS No. 166 on July 1, 2010, and does not expect that it will have a material impact on the Company’s consolidated financial statements.

SFAS No. 167

In June 2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No. 46(R), which amends the consolidation guidance applicable to variable interest entities. The amendments will significantly affect the overall consolidation analysis under FASB Interpretation No. 46(R). This statement is effective as of the beginning of the first fiscal year that begins after November 15, 2009. The Company will adopt SFAS No. 167 on July 1, 2010, and does not expect that it will have a material impact on the Company’s consolidated financial statements.

SFAS No. 168

On July 1, 2009, the FASB released the final version of its new Accounting Standards Codification (the “Codification”) as the single authoritative source for U.S. generally accepted accounting principles (“GAAP”). The Codification replaces all previous U.S. GAAP accounting standards as described in SFAS No. 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles. While not intended to change U.S. GAAP, the Codification significantly changes the way in which the accounting literature is organized. It is structured by accounting topic to help accountants and auditors more quickly identify the guidance that applies to a specific accounting issue. The Company will apply the Codification to the first quarter fiscal 2010 interim financial statements. The adoption of the Codification will not have an effect on the Company’s financial position and results of operations. However, because the Codification completely replaces existing standards, it will affect the way U.S. GAAP is referenced by the Company in its consolidated financial statements and accounting policies.

3.   Business Combinations

Decima Research

On August 16, 2007, the Company, along with 2144798 Ontario Inc., a corporation incorporated under the laws of the Province of Ontario, Canada (the Company’s wholly-owned, indirect subsidiary,

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

3.   Business Combinations — (Continued)

“Canco”), and all of the stockholders of Decima Research Inc., a corporation amalgamated under the laws of Province of Ontario, Canada (“Decima”) (such stockholders, collectively, the “Decima Sellers”) entered into a Share Purchase Agreement dated August 16, 2007 (the “Decima Purchase Agreement”) pursuant to which Canco purchased 100% of the outstanding shares of Decima (the “Decima Shares”).

This acquisition provided the Company with greater access into the Canadian market. Key sectors served by Decima included financial services, telecommunications, public affairs and tourism/recreation/gaming.

The Decima Purchase Agreement provided for an aggregate up-front purchase price for the Decima Shares of CAD$22,400 (approximately US$21,300, based on the August 15, 2007 Canadian to U.S. Dollar conversion rate), less the amount of Decima interest bearing debt at the time of closing (“Closing Debt”), and subject to increase or decrease to the extent the working capital of Decima at closing (“Closing Working Capital”) exceeded or fell below a target of CAD$2,700. The Closing Debt was repaid following the closing. The up-front purchase price was payable in cash, and based upon estimated Closing Debt and Closing Working Capital, resulted in a net adjusted cash up-front payment at closing of CAD$18,039 (approximately US$16,935, based on the August 15, 2007 Canadian to U.S. Dollar conversion rate). The up-front purchase price was subject to further adjustment when the amounts of Closing Debt and Closing Working Capital were finally determined post-closing, which resulted in additional purchase price of US$272. CAD$2,000 was withheld from the up-front purchase price payment and placed in escrow to secure the Decima Sellers’ representations, warranties, and covenants. 50% of the escrowed amount was released to the Decima Sellers on August 16, 2008 and the remainder was released on November 16, 2008. Total transaction costs amounted to $952.

In addition to the up-front purchase price, the Decima Purchase Agreement provided for contingent consideration in the form of (i) a short-term earn-out payment of CAD$2,000 (the “Decima Short-Term Earn-Out”), if Decima EBITDA, subject to certain pre-closing and closing-related credits, exceeded CAD$7,540 for the period between closing and February 16, 2009, and (ii) long-term earn-out payments (the “Decima Long-Term Earn-Out”), uncapped, and targeted at an aggregate of CAD$15,000, based upon achievement of Decima’s historical growth and profitability levels. The Decima Long-Term Earn-Out was to be measured and paid based on performance during the periods ending on each of June 30, 2008, 2009, 2010, 2011, and 2012. The Long-Term Earn-Out targets for the period ended June 30, 2008 were not achieved and during fiscal 2009, the Decima Short-Term Earn-Out and the Decima Long-Term Earn-Out were replaced, as described below.

This acquisition was accounted for under the purchase method in accordance with SFAS No. 141 and was included in the Company’s consolidated financial statements effective August 1, 2007. The Company recorded $8,361 in goodwill, $11,858 in intangible assets and a deferred tax liability of $3,915 related to the acquisition, along with the other tangible assets acquired and liabilities assumed. The goodwill is not deductible for tax purposes. The intangible assets consisted of customer relationships, an Internet respondent database, and trade names with assigned values of $11,617, $145, and $96, respectively, and useful lives (in years) of 10, 2 and 1, respectively.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

3.   Business Combinations — (Continued)

The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition:

Current assets	$	6,441
Property, plant and equipment		3,011
Goodwill		8,361
Intangible assets		11,858
Deferred tax assets		198
Total assets acquired	$	29,869
Current liabilities	$	(7,842	)
Other liabilities		(47	)
Deferred tax liability		(3,915	)
Total liabilities assumed	$	(11,804	)
Net assets acquired	$	18,065

Effective January 1, 2009, the Company, Canco, and the Decima Sellers entered into an Amendment to the Share Purchase Agreement (the “Decima Amendment”). Material terms of the Decima Amendment are as follows:

•  The Decima Short Term Earn-Out and the Decima Long Term Earn-Out were replaced by a post-closing payment of CAD$2,000 (the “New Decima Post-Closing Payment”), payable in installments as follows: (a) CAD$250 on January 1, 2009, (b) CAD$250 on June 30, 2009, and (c) CAD$500 on each of June 30, 2010, 2011 and 2012. The installments payable on January 1 and June 30, 2009 have been paid.

•  The New Decima Post-Closing Payment is subject to a formula-based, automatic reduction if any of the Decima Sellers (other than Bruce A. Anderson, the former president of Decima) voluntarily or otherwise terminates his or her employment with Decima prior to June 30, 2012.

•  Canco will cause Decima to implement a performance incentive bonus plan providing for payment of performance bonuses in an annual aggregate maximum of CAD$500 in each of fiscal years 2009-2012, subject to achievement of budgeted and projected EBITDA levels.

Except as modified by the Decima Amendment, the terms of the Decima Purchase Agreement remain unchanged.

Marketshare

On August 16, 2007, the Company’s wholly-owned subsidiary, Harris Interactive International Inc. (“HII”), Harris Interactive Asia Limited (HII’s wholly-owned Hong Kong subsidiary, “Harris Asia”), and all the stockholders of (i) Marketshare Limited, a company incorporated under the laws of Hong Kong (“Marketshare Ltd.”), and (ii) Marketshare Pte Ltd, a company incorporated under the laws of Singapore (“Marketshare Pte” and, together with Marketshare Ltd., “Marketshare”) (such stockholders, collectively, the “Marketshare Sellers”), entered into an Agreement Relating to the Sale and Purchase of the Entire Issued Share Capitals of Marketshare Limited and Marketshare Pte Ltd dated August 16, 2007 (the “Marketshare Purchase Agreement”), pursuant to which Harris Asia purchased 100% of the issued share capital of Marketshare (the “Marketshare Shares”).

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

3.   Business Combinations — (Continued)

This acquisition provided access into the rapidly growing Asia/Pacific market. Key sectors served by Marketshare included retail, financial services, technology and travel/tourism.

The Marketshare Purchase Agreement provided for an aggregate purchase price for the Marketshare Shares of $2,800 of which $2,380 was paid to the Marketshare Sellers in cash at closing, and the remaining $420 was placed in escrow to secure the Marketshare Sellers’ representations, warranties, and covenants. The escrowed amount was released to the Marketshare Sellers on August 16, 2008. Total transaction costs amounted to $206.

In addition to the up-front purchase price, the Marketshare Purchase Agreement provided for contingent consideration in the form of long-term earn-out payments (“Marketshare Long-Term Earn-Out”). Marketshare Long-Term Earn-Out payments will be due if Marketshare achieves growth and profitability expectations with respect to periods ending June 30 of each of 2008, 2009, 2010, 2011, and 2012. Such payments are targeted to total $1,800 but are contingent and uncapped. Contingent payments under the earn-out arrangement described above will be allocated to goodwill during the period in which it becomes probable that the contingent payments will be made. The Long-Term Earn-Out targets for the periods ended June 30, 2009 and 2008 were not achieved.

This acquisition was accounted for under the purchase method in accordance with SFAS No. 141 and was included in the Company’s consolidated financial statements effective August 1, 2007. The Company recorded $2,117 in goodwill, $766 in intangible assets and a deferred tax liability of $136 related to the acquisition, along with the other tangible assets acquired and liabilities assumed. The goodwill is not deductible for tax purposes. The intangible assets consisted of customer relationships and trade names with assigned values of $720 and $46, respectively, and useful lives (in years) of 10 and 0.5, respectively.

The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition:

Current assets	$	355
Property, plant and equipment		140
Goodwill		2,117
Intangible assets		766
Other long-term assets		44
Total assets acquired	$	3,422
Current liabilities	$	(288	)
Deferred tax liability		(136	)
Total liabilities assumed	$	(424	)
Net assets acquired	$	2,998

4.   Restructuring and Other Charges

Restructuring

Fiscal 2009

During the third quarter of fiscal 2009, the Company took actions to re-align the cost structure of its U.S. and U.K. operations. Specifically, the Company reduced headcount at its U.S. facilities by

65

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

4.   Restructuring and Other Charges — (Continued)

92 full-time employees and announced plans to reduce headcount at its U.K. facilities by 25 full-time employees. One-time termination benefits associated with the U.S. and U.K. actions are $2,656 and $389, respectively, all of which involve cash payments. The reductions in staff were communicated to the affected employees in March 2009. All actions were completed by March 2009 in the U.S. and May 2009 in the U.K. The related cash payments were completed by June 2009 in the U.K. and will be completed by March 2010 in the U.S.

At March 31, 2009, the Company reviewed the estimate of anticipated sublease rental income for its Rochester, New York offices, located at 135 Corporate Woods. This review, prompted by adverse changes in real estate market conditions, resulted in a decrease to the Company’s estimate of the portion of the remaining lease obligation period over which it expects to derive sublease rental income. This change in estimate resulted in a charge of $35 in the third quarter of fiscal 2009.

Previously, during the second quarter of fiscal 2009, the Company took actions to re-align the cost structure of its U.S. operations. Specifically, the Company reduced headcount at its U.S. facilities by 78 full-time employees and incurred $2,261 in one-time termination benefits, all of which involved cash payments. The reductions in staff were communicated to the affected employees in October and December 2008. All actions were completed by December 2008 and the Company expects the related cash payments to be completed by December 2009.

Additionally during the second quarter of fiscal 2009, the Company substantially vacated leased space at 135 Corporate Woods. The Company incurred $493 in charges related to the remaining operating lease obligation, all of which involved cash payments. All actions associated with this vacated space were completed by December 2008. The Company expects the related cash payments to be completed by June 2010.

At December 31, 2008, the Company reviewed the estimates of anticipated sublease rental income for its Grandville, MI and Norwalk, CT offices, which were included in restructuring charges taken during the third quarter of fiscal 2008 in conjunction with its reduction of leased space at these facilities. This review, prompted by adverse changes in real estate market conditions within each of these locales, resulted in a decrease to the Company’s estimate of the portion of the remaining lease obligation period over which it expects to derive sublease rental income. This change in estimate resulted in a charge of $366 for the three months ended December 31, 2008.

Fiscal 2008

During the fourth quarter of fiscal 2008, the Company took certain actions designed to align the cost structure of its U.K. operations with the evolving operational needs of that business. Specifically, the Company reduced headcount at its U.K. facilities by 18 full-time employees and incurred $544 in one-time termination benefits, all of which involved cash payments. The reduction in staff was communicated to the affected employees in June 2008. All actions were completed by July 31, 2008 and the related cash payments were completed in September 2008.

The U.K. restructuring described above follows separate actions taken by the Company at various times during the fourth quarter of fiscal 2008 to strategically reduce headcount at several of its U.S. facilities by a total of 24 full-time equivalents as a result of which the Company incurred $512 in one-time termination benefits, all of which involved cash payments. The reduction in staff was communicated to the affected employees in April 2008. Additionally, the Company took steps to reduce costs associated with its U.S. operations by reducing leased space at its Cincinnati, Ohio

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

4.   Restructuring and Other Charges — (Continued)

facility. The Company incurred $135 in contract termination charges related to the remaining operating lease obligation, all of which involved cash payments. All actions associated with these headcount and leased space reductions were completed in April and May 2008, respectively, and the related cash payments were completed in October 2008 and April 2009, respectively.

During the third quarter of fiscal 2008, the Company recorded $1,138 in restructuring charges directly related to its decisions made at various times during the quarter to close its telephone center in Orem, Utah by March 2008, strategically reduce headcount, and reduce leased space at its Grandville, Michigan and Norwalk, Connecticut offices. Each decision was designed to better align the Company’s cost structure with the evolving operational needs of the business.

In connection with the Orem closure, the Company reduced its headcount by 26 full-time equivalents and incurred $166 in one-time termination benefits. The reduction in staff was communicated to the affected employees in January 2008. Additionally, the Company incurred $120 in contract termination charges related to the remaining operating lease obligation. All actions were completed by March 31, 2008 and involved cash payments, which were completed in August 2008.

An additional headcount reduction of 15 full-time equivalents occurred in February 2008 and resulted in $334 in one-time termination benefits, all of which involved cash payments. All actions associated with this headcount reduction were completed in February 2008, and cash payments in connection with the one-time termination benefits were completed in September 2008.

In connection with the leased space reductions in Grandville and Norwalk, the Company incurred $518 in contract termination charges related to the remaining operating lease obligations, all of which involved cash payments. All actions associated with the space reductions were completed in March 2008. Cash payments in connection with the remaining lease obligations will be completed by April 2015.

Fiscal 2007

During the fourth quarter of fiscal 2007, the Company recorded $337 in restructuring charges directly related to a facilities consolidation and headcount reduction, both designed to ensure the alignment of its cost structure with the operational needs of the business. The Company negotiated an amendment to the lease agreement for its Reston, Virginia office, terminating the Company’s lease with respect to a portion of its space in exchange for a payment of $230 to the landlord, subject to conditions which have since been met. As a result of the amendment, the Company’s lease obligation over the remaining term of the lease was reduced by approximately $500 from the initial lease, which, when offset against the payment to the landlord for the space reduction noted above, resulted in anticipated net savings of approximately $300 over the remaining lease term.

The Company also reduced the staff of its U.S. operations by 6 full-time equivalents and incurred $107 in severance charges, all of which involved cash payments. The reduction in staff was communicated to the affected employees during the fourth quarter of fiscal 2007. All actions in the plan were completed by June 30, 2007. Cash payments in connection with the plan were completed in December 2007.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

4.   Restructuring and Other Charges — (Continued)

Summary of Restructuring Charges and Reserves

The following table summarizes the restructuring charges recognized in the Company’s consolidated statements of operations for the fiscal years ended June 30:

	2009			2008			2007
Severance obligations	$	5,306		$	1,556		$	107
Lease commitments		894			771			230
Reversals of prior accruals		(543	)		(64	)		—
	$	5,657		$	2,263		$	337

The following table summarizes activity during fiscal 2009 with respect to the Company’s remaining reserves for the restructuring activities described above and those undertaken in prior fiscal years:

	Balance,												Balance,
	July 1,		Costs		Changes in			Cash			Non-Cash		June 30,
	2008		Incurred		Estimate			Payments			Settlements		2009
Severance payments	$	670	$	5,306	$	(539	)	$	(4,212	)	$	—	$	1,225
Lease commitments		570		894		(4	)		(468	)		—		992
Remaining reserve	$	1,240	$	6,200	$	(543	)	$	(4,680	)	$	—	$	2,217

The changes in estimate noted above were principally the result of the termination of certain one-time termination benefits that were initially provided but for which the underlying contractual obligations were not subsequently fulfilled, as well as certain outplacement benefits that expired unused.

Other Charges

Other charges reflected in the “Restructuring and other charges” line shown on the Company’s consolidated statements of operations for the fiscal years ended June 30, 2009 and 2008 included the following:

•  Contractually obligated payments to former executives — In connection with their departures from the Company during fiscal 2009, Gregory T. Novak, Ronald E. Salluzzo and David B. Vaden became entitled to certain contractually obligated payments, all of which are cash payments. These cash payments will be completed in December 2010, December 2009 and February 2010, respectively.

During fiscal 2008, the Company incurred $762 in severance charges for Leonard R. Bayer, its former Executive Vice President, Chief Scientist and Chief Technology Officer, in connection with his retirement, which was effective March 31, 2008. This amount was reclassified from the “Selling, general and administrative” expense line in the Company’s consolidated statements of operations to conform to the current year presentation, as more fully described in Note 2, “Summary of Significant Accounting Policies — Reclassifications”.

•  Performance improvement consultant fees — The Company retained a consulting firm to assist with performance improvement initiatives, bank negotiations and interim CFO services and incurred fees for services rendered.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

4.   Restructuring and Other Charges — (Continued)

•  Cost of reviewing strategic alternatives — During fiscal 2008, the Company incurred legal, accounting, banking and other costs in connection with a decision by its Board of Directors to investigate strategic alternatives available to the Company. After retaining an investment bank to assist with this process and considering the results of the investigations, the Board determined that it was in the best interests of the Company’s stockholders to discontinue the process.

•  Bank negotiation legal fees — During fiscal 2009, the Company incurred legal fees in connection with the negotiations of the waiver and amendments to its credit facilities, as more fully described in Note 11, “Borrowings.”

•  Other — Included in “Other” is the bad debt expense for a note receivable for which collectability has become doubtful and recruitment fees for senior executives.

	2009		2008
Performance improvement consultant fees	$	3,095	$	—
Contractually obligated payments to former executives		1,997		762
Cost of reviewing strategic alternatives		—		1,584
Bank negotiation legal fees		382		—
Other		879		—
	$	6,353	$	2,346

There were no such charges during the fiscal year ended June 30, 2007.

5.   Fair Value Measurements

SFAS No. 157 establishes a hierarchy for inputs used in measuring fair value for financial assets and liabilities that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The hierarchy is broken down into three levels:

•  Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

•  Level 2 inputs include data points that are observable such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) such as interest rates and yield curves that are observable for the asset and liability, either directly or indirectly.

•  Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

5.   Fair Value Measurements — (Continued)

The following table presents the fair value hierarchy for the Company’s financial assets and liabilities measured at fair value on a recurring basis at June 30, 2009:

	Recurring Fair Value Measurements
	Quoted		Significant
	Prices in		Other		Significant
	Active		Observable		Unobservable
	Markets		Inputs		Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Financial assets:
Cash equivalents	$	—	$	2,720	$	—	$	2,720
Available for sale marketable securities		—		1,010		—		1,010
Total	$	—	$	3,730	$	—	$	3,730
Financial liabilities:
Interest rate swap contract	$	—	$	1,351	$	—	$	1,351

The fair value of the Company’s cash equivalents and available for sale marketable securities were derived from quoted market prices for similar instruments, with all significant inputs derived from or corroborated by observable market data. The fair value of the Company’s interest rate swap was based on quotes from the respective counterparty, which are corroborated by the Company using discounted cash flow calculations based upon forward interest-rate yield curves obtained from independent pricing services.

6.   Marketable Securities

At June 30, 2009, the Company’s marketable securities consisted solely of government securities classified as available for sale. The cost basis of the securities was $1,000, their fair value was $1,010, and they will reach maturity in less than one year. At June 30, 2008, the Company had no marketable securities.

There were no gross unrealized gains or losses on available-for-sale securities at June 30, 2009 and 2008.

There were no realized gains or losses from sales of available-for-sale securities during the fiscal year ended June 30, 2009. The Company had a realized loss of $2 from sales of available-for-sale securities during the fiscal year ended June 30, 2008.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

7.   Property, Plant and Equipment

At June 30, property, plant and equipment consisted of the following:

	2009			2008
Furniture and fixtures	$	7,354		$	7,640
Equipment		35,141			35,633
Leasehold improvements		12,058			12,609
		54,553			55,882
Accumulated depreciation		(46,538	)		(43,929	)
	$	8,015		$	11,953

Depreciation expense on property, plant and equipment amounted to $4,634, $5,087, and $3,966 for the fiscal years ended June 30, 2009, 2008 and 2007, respectively.

8.   Goodwill

Fiscal 2009

At September 30, 2008, the Company considered the incremental decline in its stock price from $2.01 at June 30 to $1.73 at the end of September. At that time, the Company concluded that this decline was short-term in nature and absent factors to the contrary, did not trigger a review for impairment outside of its next scheduled annual impairment evaluation date, June 30, 2009.

As part of its closing process for the three months ended December 31, 2008, the Company considered the following factors in determining whether an impairment review outside of its annual impairment evaluation date was necessary:

•  operating losses in its single reporting unit for the fiscal quarters ended September 30, 2008 and December 31, 2008,

•  potential declines in market research spending for calendar year 2009 based on industry forecasts from Inside Research,,

•  headcount reductions and related charges as announced in October and December 2008, the details of which are described in Note 4, “Restructuring and Other Charges,” to these consolidated financial statements, and

•  a 62% decline in the Company’s per share stock price from $1.73 at September 30, 2008 to $0.65 at December 31, 2008, which resulted in a market capitalization that, based on the Company’s per share stock price as of market close on December 31, 2008, was below the carrying value of its reporting unit’s net assets at that date.

Based on its consideration of the above-noted factors, the Company concluded that an interim period goodwill impairment evaluation was necessary at December 31, 2008. Accordingly, the Company performed the initial step of its impairment evaluation and determined that the carrying value of its reporting unit’s net assets exceeded their fair value. The fair value of the reporting unit was determined using a discounted cash flow analysis, which used a discount rate based on the Company’s best estimate of the after-tax weighted average cost of capital, adjusted for the financial risk associated with its future operations.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

8.   Goodwill — (Continued)

In the second step of its impairment evaluation, the Company determined the implied fair value of goodwill and compared it to the carrying value of the goodwill. The fair value of its reporting unit was allocated to all of its assets and liabilities as if it had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. This allocation resulted in no implied fair value of goodwill. Therefore, the Company recognized an impairment charge of $40,250, the remaining amount of its previously reported goodwill.

Fiscal 2008

At March 31, 2008, the Company considered the decline in its stock price from January 2008 to March 2008. At that time, the Company concluded that the decline was short-term in nature and did not trigger a review for impairment outside of its annual June 30 impairment evaluation date.

At June 30, 2008, the Company performed the initial step of its impairment evaluation by comparing the fair market value of its reporting unit, as determined using a discounted cash flow model, to its carrying value. As the carrying amount exceeded the fair value, the Company performed the second step of its impairment evaluation to calculate impairment and as a result, recorded a pre- tax goodwill impairment charge of $86,497. The primary reason for the impairment charge was the sustained decline of the Company’s stock price during the second half of fiscal 2008.

The changes in the carrying amount of goodwill for the fiscal years ended June 30, 2007, 2008 and 2009 were as follows:

Balance at June 30, 2007	$	115,466
Acquisition of Decima Research, Inc. (Note 3)		8,034
Acquisition of Marketshare (Note 3)		2,109
Foreign currency translation adjustments		3,680
Purchase accounting adjustments related to MediaTransfer, Decima and Marketshare acquisitions		30
Prior period purchase accounting adjustment of deferred taxes		(17	)
Goodwill impairment charge		(86,497	)
Balance at June 30, 2008	$	42,805
Foreign currency translation adjustments		(2,404	)
Prior period purchase accounting adjustment of deferred taxes		(151	)
Goodwill impairment charge		(40,250	)
Balance at June 30, 2009	$	—

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

9.   Acquired Intangible Assets Subject to Amortization

At June 30, acquired intangible assets subject to amortization consisted of the following:

	2009
	Weighted-Average		Gross				Net
	Useful Amortization		Carrying		Accumulated		Book
	Period (In Years)		Amount		Amortization		Value
Contract-based intangibles		3.4	$	1,768	$	1,768	$	—
Internet respondent database		7.1		3,330		2,100		1,230
Customer relationships		9.6		20,286		6,436		13,850
Trade names		16.3		5,298		1,838		3,460
Total			$	30,682	$	12,142	$	18,540

	2008
	Weighted-Average		Gross				Net
	Amortization Period		Carrying		Accumulated		Book
	(In Years)		Amount		Amortization		Value
Contract-based intangibles		3.4	$	1,770	$	1,763	$	7
Internet respondent database		7.1		3,617		1,682		1,935
Customer relationships		9.6		22,231		4,594		17,637
Trade names		16.1		5,364		1,641		3,723
Total			$	32,982	$	9,680	$	23,302

	2009		2008		2007
Aggregate amortization expense:
For the fiscal year ended June 30:	$	2,976	$	3,441	$	1,430
Estimated amortization expense for the fiscal years ending June 30,:
2010	$	2,741
2011	$	2,735
2012	$	2,735
2013	$	2,565
2014	$	2,126
Thereafter	$	5,638

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

10.   Accrued Expenses

At June 30, accrued expenses consisted of the following:

	2009		2008
Panelist incentives	$	3,989	$	4,776
Bonuses		1,779		2,420
Payroll and withholding expenses		1,950		3,305
Accrued vacation		1,965		2,304
Other		8,666		12,806
	$	18,349	$	25,611

“Other” consists of accrued expenses that are individually less than 5% of total current liabilities.

11.   Borrowings

On September 21, 2007, the Company entered into a Credit Agreement (the “2007 Credit Agreement”) with JPMorgan Chase Bank, N.A. (“JPMorgan”), as Administrative Agent, and the Lenders party thereto, pursuant to which the Lenders made available certain credit facilities. As of December 31, 2008, the Company was in violation of the leverage and interest coverage covenants under the terms of the 2007 Credit Agreement. The Company obtained a 30-day waiver of the covenant violations from the Lenders on February 5, 2009, and in connection with the waiver, the 2007 Credit Agreement was amended (“First Amendment”). The Company obtained an additional 60-day extension of the waiver on March 6, 2009, and in connection with the waiver, the 2007 Credit Agreement was further amended in immaterial respects. On May 6, 2009 and effective as of that date, the Company entered into a further amendment (the “Second Amendment”) to the 2007 Credit Agreement, pursuant to which the prior covenant defaults were permanently waived and the Company was again in compliance with the terms of the 2007 Credit Agreement, as amended.

At June 30, 2009, the Company was in compliance with all of the covenants under the 2007 Credit Agreement, as amended.

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

11.   Borrowings — (Continued)

The Credit Agreement

The principal terms of the 2007 Credit Agreement, as amended, are described below:

2007 Credit Agreement	With Amendments
Availability:
$25,000 Revolving Line	$5,000 Revolving Line
• Up to $10,000 of Revolving Line may be used to back Letters of Credit	• Until certain leverage ratios are achieved, advances require minimum cash balances and no outstanding balance may exist at least 5 consecutive days in every 30-day period
• $25,000 Revolving Line increased availability at Lender discretion
$12,000 Term Loan A	• The Revolving Line may be used to back Letters of Credit
$19,825 Term Loan B	• No Revolving Line increased availability at Lender discretion
$2,900 Term Loan C	Term Loan A – unchanged
$28,275 Term Loan additional availability at Company discretion	Term Loan B and C – consolidated and otherwise unchanged
	No additional Term Loan availability at Company discretion
Interest:
Company option:	Company option:
• Base Rate (greater of Federal Funds Rate plus 0.5% or Prime) plus 0.5%	• Base Rate (greater of Federal Funds Rate plus 0.5%, LIBOR plus 1%, or Prime) plus 4%
OR	OR
• LIBOR plus spread ranging between 0.625% and 1%, based upon leverage ratio	• LIBOR plus 4% under First Amendment and 5% under Second Amendment
The Company elected LIBOR option for Term Loans, and entered into interest swap agreement fixing LIBOR rate at 5.08% through September 21, 2012. With the spread, the effective rate on the Term Loans was 5.955% at December 31, 2008.	The Company election of LIBOR and interest swap agreement remained unchanged. With the spread, the effective rate on the Term Loans is 9.08% under the First Amendment, and 10.08% after the Second Amendment
Interest payments are due at end of LIBOR interest periods, but at least quarterly in arrears	Payment schedule is unchanged
Unused Facility Fees:
Based upon leverage ratio, fee of between .10% and .175% of unused Revolving Line amount	Fee fixed at .5% of unused Revolving Line amount under the First Amendment, and 1.0% after the Second Amendment

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

11.   Borrowings — (Continued)

2007 Credit Agreement	With Amendments
Principal Payments:
Term Loan Maturity – September 21, 2012	Term Loan Maturity – unchanged
Revolving Line Maturity – September 21, 2012	Revolving Line Maturity – July 15, 2010
Revolving Line - payable at maturity	Revolving Line and Term Loan payment schedules are unchanged
Quarterly Term Loan Payments:
• Term Loan A – $600 quarterly
• Term Loan B – $991 quarterly
• Term Loan C – $140 quarterly
Financial Covenants:
Minimum Consolidated Interest Coverage Ratio of 3.00:1.0	Minimum Consolidated Interest Coverage Ratio ranging over various quarters between 3.00:1.0 and 1.75:1.0
Maximum Consolidated Leverage Ratio of 2.50:1.0	Maximum Consolidated Leverage Ratio ranging over various quarters between 6.40:1.0 and 2.00:1.0
	Minimum Consolidated Revenue (trailing 3 months) ranging over various quarters between $33,200 and $45,400
Collateral:
Unsecured	Secured by all domestic assets and 66% of equity interests in first tier foreign subsidiaries

The 2007 Credit Agreement, as amended, contains customary representations, default provisions, and affirmative and negative covenants, including among others prohibitions of dividends, sales of certain assets and mergers, and restrictions related to acquisitions, indebtedness, liens, investments, share repurchases and capital expenditures. Among others, the Company may freely transfer assets and incur obligations among its domestic subsidiaries, but limitations apply to transfers of assets and loans to foreign subsidiaries.

At June 30, 2009, the required principal repayments of Term Loans A and B (reflecting the consolidation of Term Loans B and C into Term Loan B) for the four succeeding fiscal years are as follows:

	Term Loan A		Term Loan B		Total
2010		2,400		4,525		6,925
2011		2,400		4,525		6,925
2012		2,400		4,525		6,925
2013		600		1,131		1,731
	$	7,800	$	14,706	$	22,506

At June 30, 2008, the Company had $29,431 outstanding under the 2007 Credit Agreement.

76

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

11.   Borrowings — (Continued)

At June 30, 2009 and 2008, the Company did not have any amounts outstanding under its revolving line of credit.

Interest Rate Swap

Effective September 21, 2007, the Company entered into an interest rate swap agreement with JPMorgan, which effectively fixed the floating LIBOR interest portion of the rates on the amounts outstanding under Term Loans A and B (reflecting the consolidation of Term Loans B and C into Term Loan B) at 5.08% through September 21, 2012. The three-month LIBOR rate received on the swap matches the base rate paid on the term loan since both use three-month LIBOR. The swap had an initial notional value of $34,625 which declines as payments are made on Term Loans A and B so that the amount outstanding under those term loans and the notional amount of the swap are always equal. The interest rate swap had a notional amount of $22,506 at June 30, 2009, which was the same as the outstanding amount of the term loans. The applicable spreads referenced in the table above are added to the 5.08% rate fixed by the interest rate swap.

The terms of the interest rate swap remain unaffected by the First or Second Amendments. The interest rate swap continues to be accounted for in accordance with SFAS No. 133.

At June 30, 2009, the Company recorded a liability of $1,351 in the “Other liabilities” line item of its unaudited consolidated balance sheet to reflect the fair value of the interest rate swap. As a result of the covenant violations noted above, it was determined that the interest rate swap was not an effective cash flow hedge at both December 31, 2008 and March 31, 2009. Accordingly, the Company recorded charges to interest expense to reflect the ineffectiveness of the swap of $1,017 during the second and third quarters of the fiscal year ended June 30, 2009. At May 6, 2009, the swap was once again deemed an effective cash flow hedge, and continued to be effective at June 30, 2009. As such, changes in the fair value of the interest rate swap were once again recorded through other comprehensive income.

12.   Derivative Financial Instruments

Information concerning the Company’s derivative financial instruments at June 30, 2009 was as follows:

Fair Value of Derivative Instruments in Consolidated Balance Sheet

	Balance Sheet Location		Fair Value
Interest rate swap agreements designated as cash flow hedges		Other liabilities	$	1,351
Total derivatives designated as hedging instruments			$	1,351
Total derivatives			$	1,351

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

12.   Derivative Financial Instruments — (Continued)

Effects of Derivative Instruments on Income and Accumulated Other Comprehensive Income (OCI)

						Amount and Location
						of Gain (Loss)
			Amount and Location			Recognized in Income
	Amount of Gain		of Gain (Loss)			on Derivative
	(Loss) Recognized in		Reclassified from			(Ineffective Portion
	Accumulated OCI		Accumulated OCI			and Amount
	on Derivative		into Income			Excluded from
	(Effective Portion)		(Effective Portion)			Effectiveness Testing)
Cash flow hedges:
Interest rate swaps	$	30	$	361	Interest expense	$	(1,017	)	Interest and other income

13.   Stockholders’ Equity

Common Stock

100,000,000 shares of common stock are authorized by the Company’s Certificate of Incorporation, as amended in fiscal 2000.

Restricted Stock Award Withholdings

The Company issues restricted stock awards as part of its Long Term Incentive Plan. For certain of the restricted stock awards granted, the number of shares released on the date the restricted stock awards vest is net of the statutory withholding requirements that the Company pays to the appropriate taxing authorities on behalf of its employees. The shares repurchased to satisfy the statutory withholding requirements are immediately retired.

Stockholder Rights Plan

On March 11, 2005, the Company’s Board of Directors adopted a stockholder rights plan, as set forth in the Rights Agreement, dated March 11, 2005 (the “Rights Agreement”). Under the Rights Agreement, the Board of Directors declared a dividend distribution of one preferred share purchase right (a “Right”) for each outstanding share of the Company’s common stock, par value $.001 per share, to stockholders of record as of the close of business on March 29, 2005 (the “Record Date”). In addition, one Right automatically attaches to each share of common stock issued between the Record Date and the Distribution Date (defined below). Each Right entitles the holder to purchase from the Company a unit consisting of one one-thousandth of a share (a “Unit”) of the Company’s Series A Preferred Stock, par value $.01 per share, at a cash exercise price of $27.48 per Unit, subject to adjustment under certain conditions specified in the Rights Agreement. The Rights will separate from the common stock and will become exercisable only when a public announcement has been made that a person or group acquires beneficial ownership of 15% or more of the outstanding shares of the Company’s common stock (an “Acquiring Person”), other than as a result of repurchases of stock by the Company or certain inadvertent actions by a stockholder, or ten days after a person commences, or publicly announces the intention to commence (which intention to commence remains in effect for five business days after such announcement), a tender offer or exchange offer that could result in the person or group becoming an Acquiring Person and that is not terminated within such ten-day period (the earlier of such dates being referred to as the “Distribution Date”). If a person or group becomes an Acquiring Person, each holder of a Right (other than the Acquiring Person and certain of its related parties, whose Rights become null and void) will be entitled to receive upon exercise of each Right

78

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

13.   Stockholders’ Equity — (Continued)

that number of Units equal to $27.48 (as adjusted) multiplied by the number of Units for which the Right is then exercisable, divided by 50% of the then current per share market price of the Company’s common stock. If there are insufficient shares of preferred stock to permit full exercise of all of the Rights, holders of Rights may instead receive shares of the Company’s common stock, other securities, cash or property, or a combination thereof. If, at any time after a person or group becomes an Acquiring Person, the Company is acquired in a merger or other business combination transaction with an Acquiring Person or certain other types of transaction specified in the Rights Agreement, each holder of a Right (other than the Acquiring Person and certain of its related parties, whose Rights become null and void) will be entitled to receive upon exercise of each Right, in lieu of shares of preferred stock, that number of shares of the common stock of the surviving entity equal to $27.48 (as adjusted) multiplied by the number of Units for which the Right is then exercisable, divided by 50% of the then current per share market price of the surviving entity’s common stock.

The Rights are not exercisable until a Distribution Date occurs and will expire on March 11, 2015, unless earlier terminated or redeemed by the Company in accordance with the Rights Agreement. Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including without limitation, no right to vote or receive dividends. The Rights Agreement will be reviewed and evaluated at least once every three years by a “TIDES Committee” of independent directors. During fiscal 2007, the TIDES Committee reviewed the Rights Agreement and recommended no changes to it.

14.   Stock-Based Compensation

The Company adopted a Long Term Incentive Plan in 1999, amended in November 2004 (“1999 Incentive Plan”), and a 2007 Long Term Incentive Plan (“2007 Incentive Plan”). The 1999 Incentive Plan and the 2007 Incentive Plan are together called the “Incentive Plans”. In addition, in 2001 as part of its acquisition of Total Research Corporation the Company also assumed certain options previously issued by that company under its incentive plans (“Total Plans”). The Company also adopted an Employee Stock Purchase Plan in 1999, amended in November 2004 (“1999 ESPP”), and a 2007 Employee Stock Purchase Plan (“2007 ESPP”). The 1999 ESPP and the 2007 ESPP are together called the “ESPPs”. In January 2008, the Company adopted the Harris Interactive UK Limited Share Incentive Plan (“SIP”). The Company also has issued stock options to certain new employees outside the Incentive Plans.

For the fiscal years ended June 30, 2009, 2008 and 2007, the Company recorded stock-based compensation expense for the cost of stock options and restricted stock issued under the Incentive Plans, Total Plans, stock options issued to new employees outside the Incentive Plans and shares issued under the ESPPs of $1,965, $4,091 and $3,787, respectively. The SIP has been deemed non-compensatory and therefore, there are no stock-based compensation costs associated with such plan, as more fully described below under “Employee Stock Purchase Plans.” The Company’s expensing of stock-based compensation decreased both its basic and diluted net income per share by $0.04, $0.08, and $0.07 for the fiscal years ended June 30, 2009, 2008 and 2007, respectively. Any potential tax benefits associated with incentive stock options are recognized if and when the Company receives a tax deduction associated with the options. Accordingly, due to the timing of the recognition of the tax benefit versus the related stock-based compensation expense, the Company’s effective tax rate was increased for the fiscal years ended June 30, 2009, 2008 and 2007.

79

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

14.   Stock-Based Compensation — (Continued)

The Company did not capitalize stock-based compensation expense as part of the cost of an asset for any periods presented. The following table illustrates the stock-based compensation expense included in the Company’s consolidated statements of operations for the fiscal years ended June 30:

	2009		2008		2007
Cost of services	$	54	$	184	$	97
Selling, general and administrative		1,911		3,907		3,690
	$	1,965	$	4,091	$	3,787

The Company determines the fair value of each option award on the date of grant using the Black-Scholes option-pricing model. Expected volatilities are based on historical volatilities from daily share price observations for the Company’s stock covering a period commensurate with the expected term of the options granted. The Company has elected to use the “simplified” method as permitted by SAB No. 110 for purposes of determining the expected life of options when granted, given that the Incentive Plans have been in place for less than ten years. The risk-free interest rate is based on the implied yield available at the time the options were granted on U.S. Treasury zero coupon issues with a remaining term equal to the expected life of the options when granted. The expected dividend yield is based on the Company’s historical practice of electing not to pay dividends to its shareholders.

Long Term Incentive Plans

The Company maintains the Incentive Plans, nonqualified and incentive stock option and stock awards plans that enable key employees and directors of the Company to purchase and receive shares of common stock of the Company. The Company grants options to purchase its common stock at an exercise price equal to the fair market value as of the date of grant. Options generally vest over a period of up to four years for employees and three years for directors, and expire after ten years from the date of grant or earlier, if in connection with termination of employment or service as a director. Certain options vest only upon the achievement of performance targets. Vesting of options is accelerated in certain circumstances upon a change in control. In addition, the Incentive Plans also allow for the issuance of restricted stock awards. Restricted stock awards generally vest over a period of up to four years for employees and one year for directors, and any unvested portion forfeits upon termination of employment or service as a director. Certain restricted stock awards vest only upon achievement of performance targets.

The Company has registered a total of 10,250,000 shares of common stock for issuance under the Incentive Plans. At June 30, 2009, 5,659,470 shares were unissued and available for grant under the Incentive Plans.

Options Granted Outside the Incentive Plans

During fiscal 2008, the Company registered an additional 92,018 shares for issuance upon exercise of non-qualified stock options that were granted to Bruce A. Anderson, then president of the Company’s Canadian operations, in connection with its acquisition of those operations. Those options were forfeited in fiscal 2009 upon Mr. Anderson’s departure from the Company.

During fiscal 2006, the Company registered an additional 350,000 shares for issuance upon exercise of non-qualified stock options that were granted to Ronald E. Salluzzo in connection with his

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HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

14.   Stock-Based Compensation — (Continued)

hiring as the Company’s Chief Financial Officer. Those options were forfeited in fiscal 2009 upon Mr. Salluzzo’s departure from the Company.

Investor Stock Options

At June 30, 2009 and 2008, the Company had outstanding non-qualified investor options to acquire 88,887 shares of its common stock that were issued in connection with the Company’s acquisition of Novatris SA in March 2004. Investor options are not included as options under the Incentive Plans.

Summary of Options and Restricted Stock Award Status

The following table provides a summary of the status of the Company’s employee stock options (including options issued under the Incentive Plans and Total Plans, as well as options issued outside the Incentive Plans to new employees) for the fiscal years ended June 30:

	2009					2008					2007
				Weighted-					Weighted-					Weighted-
				Average					Average					Average
				Exercise					Exercise					Exercise
	Shares			Price		Shares			Price		Shares			Price
Options outstanding at July 1		5,804,172		$	5.32		5,576,373		$	5.34		6,150,034		$	5.41
Granted		1,910,000			0.93		775,314			4.17		652,500			5.54
Forfeited		(3,856,963	)		5.37		(511,515	)		4.20		(751,591	)		7.31
Exercised		—			—		(36,000	)		0.47		(474,570	)		3.46
Options outstanding at June 30		3,857,209		$	3.09		5,804,172		$	5.32		5,576,373		$	5.34

The total intrinsic value of options exercised during the fiscal years ended June 30, 2009, 2008 and 2007 was $0, $137, and $1,107, respectively.

The following weighted-average assumptions were used to value options granted by the Company during the fiscal years ended June 30:

	2009			2008			2007
Risk-free interest rate		2.7	%		4.2	%		4.6	%
Weighted-average expected life (in years)		6.3			6.3			6.3
Volatility factor		56	%		59	%		63	%
Dividend yield		—			—			—
Weighted-average fair value	$	0.51		$	2.48		$	3.50

Cash received from the exercise of employee stock options was $0, $17, and $1,640, respectively, for the fiscal years ended June 30, 2009, 2008 and 2007, respectively.

81

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

14.   Stock-Based Compensation — (Continued)

The following table summarizes stock options under the Company’s stock option plans (including options issued under the Incentive Plans and Total Plans, as well as options issued outside the Incentive Plans to new employees) at June 30, 2009:

	Options Outstanding									Options Exercisable
			Weighted-									Weighted-
			Average		Weighted-							Average		Weighted
			Remaining		Average		Aggregate					Remaining		Average		Aggregate
Range of	Number of		Contractual		Exercise		Intrinsic			Number of		Contractual		Exercise		Intrinsic
Exercise Prices	Options		Life (In Years)		Price		Value			Options		Life (In Years)		Price		Value
$ 0.38 – 1.12		1,910,000		9.4	$	0.93		(986	)		—		—	$	—		—
2.10 – 3.32		290,083		3.1		2.33		(556	)		283,416		3.0		2.32		(542	)
3.70 – 4.98		628,625		5.3		4.19		(2,373	)		480,690		4.4		4.17		(1,808	)
5.00 – 6.38		567,501		5.9		5.59		(2,942	)		520,749		5.8		5.61		(2,706	)
6.56 – 8.57		396,000		4.2		7.52		(2,816	)		396,000		4.2		7.52		(2,816	)
11.00		65,000		0.7		11.00		(688	)		65,000		0.7		11.00		(688	)
		3,857,209		7.1	$	3.09	$	(10,361	)		1,745,855		4.4	$	5.31	$	(8,560	)

At June 30, 2009, 500,000 of the outstanding employee stock option awards consist of awards that vest with the achievement of certain performance targets over the next four years.

The following table provides a summary of the status of the Company’s employee and director restricted stock awards for the fiscal years ended June 30:

	2009					2008					2007
				Weighted-					Weighted-					Weighted-
				Average					Average					Average
				Grant Date					Grant Date					Grant Date
	Shares			Fair Value		Shares			Fair Value		Shares			Fair Value
Restricted shares outstanding at July 1		555,574		$	3.79		200,622		$	5.63		116,333		$	5.05
Granted		128,833			1.04		673,925			3.61		209,135			6.00
Forfeited		(412,785	)		3.47		(197,020	)		4.22		(5,028	)		6.53
Vested		(160,904	)		3.04		(121,953	)		5.12		(119,818	)		5.67
Restricted shares outstanding at June 30		110,718		$	2.86		555,574		$	3.79		200,622		$	5.63

82

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

14.   Stock-Based Compensation — (Continued)

At June 30, 2009, unamortized stock-based compensation expense for stock options and restricted stock awards issued and outstanding at June 30, 2009 will be recognized during the fiscal years ending June 30 as follows:

			Restricted
	Stock		Stock
	Options		Awards		Total
2010	$	464	$	145	$	609
2011		388		95		483
2012		197		21		218
2013		71		—		71
Total	$	1,120	$	261	$	1,381
Weighted-average vesting period (in years)		3.0		2.2		2.8

Employee Stock Purchase Plans

The Company registered 500,000 shares of common stock in March 2000, and an additional 500,000 shares in both November 2004 and October 2007, for issuance under the Company’s ESPPs. The ESPPs provide employees with an opportunity to purchase the Company’s common stock through payroll deductions through semi-annual offerings in July and January of each fiscal year. Under the ESPPs, the Company’s employees may purchase, subject to certain restrictions, shares of common stock at the lesser of 85% of the fair value at either the beginning or the end of each six month offering period. During fiscal years 2009, 2008 and 2007, employees purchased 337,876, 233,491, and 142,310 shares of common stock through the ESPPs, respectively.

The ESPPs are considered compensatory under SFAS No. 123(R) and thus, a portion of the cost related to the July and January offerings under the ESPPs are included in the Company’s stock-based compensation expense for the fiscal years ended June 30, 2009, 2008 and 2007.

The fair value of the July and January offerings under the ESPPs were determined on the date of grant using the Black-Scholes option-pricing model. Expected volatility was determined based on the historical volatility from daily share price observations for the Company’s stock covering a period commensurate with the expected life of the rights under the ESPPs. The risk-free interest rate is based on the implied yield currently available at the time the rights under the ESPPs were granted on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life of the rights under the ESPPs when granted. The expected dividend yield is based on the Company’s historical practice of electing not to pay dividends to its shareholders.

The following weighted-average assumptions were used to value rights under the ESPPs for the July and January offerings for the fiscal years ended June 30:

	2009			2008			2007
Risk-free interest rate		1.6	%		3.8	%		5.0	%
Weighted-average expected life (in years)		0.5			0.5			0.5
Volatility factor		80	%		51	%		40	%
Dividend yield		—			—			—
Weighted-average fair value	$	0.50		$	1.33		$	1.37

83

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

14.   Stock-Based Compensation — (Continued)

U.K. employees may purchase the Company’s common stock pursuant to the SIP through a payroll deduction with no discount to the market price. Employees are entitled to receive three matching shares for every seventeen shares purchased under the SIP. The SIP has been deemed non-compensatory subject to the provisions of SFAS No. 123(R) and, therefore, no stock-based compensation costs were recognized for fiscal 2009 or 2008.

15.   401(k) Plan

The Company established a 401(k) Plan effective January 1, 1995. Eligible employees may begin to participate in the 401(k) Plan the first of the month following their date of hire, but are not eligible to receive employer matching contributions, if any, until the first of the calendar quarter following the one anniversary year of service during which they have worked at least 1,000 hours.

Participants may contribute from 1% to 60% of compensation up to federally established limitations. Employer matching contributions are discretionary, and were made in the form of Company stock through March 31, 2008. The Company made a matching contribution in cash on June 30, 2008, and expects to make any future matching contributions in cash. The Company suspended its matching contributions on January 1, 2009 and had not resumed them as of June 30, 2009.

Matching contribution expense incurred by the Company during the fiscal years ended June 30, 2009, 2008 and 2007 was $563, $1,311, and $1,298, respectively.

16.   Income Taxes

For the fiscal years ended June 30, the U.S. and Foreign components of income (loss) from continuing operations before income taxes were as follows:

	2009			2008			2007
U.S.	$	(44,457	)	$	(55,612	)	$	11,410
Foreign		(15,025	)		(29,791	)		2,863
	$	(59,482	)	$	(85,403	)	$	14,273

For the fiscal years ended June 30, the provision (benefit) for income taxes from continuing operations consisted of the following:

	2009			2008			2007
Current:
Federal	$	(1,375	)	$	853		$	1,273
State		192			412			802
Foreign		42			493			583
	$	(1,141	)	$	1,758		$	2,658
Deferred:
Federal	$	15,010		$	(700	)	$	2,459
State		3,028			(511	)		156
Foreign		(1,048	)		(1,208	)		46
	$	16,990		$	(2,419	)	$	2,661
	$	15,849		$	(661	)	$	5,319

84

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

16.   Income Taxes — (Continued)

The provision (benefit) for income taxes from continuing operations differs from the amount of income tax computed by applying the applicable U.S. statutory federal income tax rate to income from continuing operations before income taxes as follows:

	2009			2008			2007
Provision at federal statutory rate	$	(20,819	)	$	(29,891	)	$	4,996
State income tax provision, net of federal effect		3,220			(64	)		817
Unremitted earnings and rate differential of foreign subsidiaries		534			(114	)		(275	)
Stock-based compensation		1,981			458			386
Change in valuation allowance		18,908			493			(998	)
Alternative minimum tax credit		(1,182	)		—			—
Non-deductible portion of goodwill impairment charge		13,049			28,176			—
Other		158			281			393
	$	15,849		$	(661	)	$	5,319

At June 30, deferred tax assets (liabilities) consisted of the following:

	2009			2008
Operating loss carryforwards	$	14,942		$	12,199
Internet database development expenses		977			1,023
Stock-based compensation		573			2,162
HIpoints accrual		1,240			1,463
Capital loss carryforward		492			640
Goodwill		1,599			574
Accrued expenses		1,358			818
Other		3,981			2,118
Gross deferred tax assets		25,162			20,997
Valuation allowance		(23,549	)		(1,289	)
		1,613			19,708
Other intangibles		(3,860	)		(5,178	)
Gross deferred tax liabilities		(3,860	)		(5,178	)
Net deferred tax assets (liabilities)	$	(2,247	)	$	14,530

At June 30, 2009, the Company had U.S. federal and various state net operating loss carryforwards of $36,503 that will begin to expire in 2021.

Under existing Federal tax laws, Internal Revenue Code Section 382 provides for an annual limitation on the utilization of federal operating loss and tax credit carryforwards generated prior to certain ownership changes. The Company’s acquisition of Total Research Corporation in November 2001 resulted in an ownership change for federal income tax purposes and accordingly, this could limit the Company’s ability to use its federal operating loss and tax credit carryforwards in future years. As

85

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

16.   Income Taxes — (Continued)

of June 30, 2009, of the Company’s total federal operating loss carryover, approximately $28,444 is subject to an annual limitation under Internal Revenue Code Section 382.

The sale of the Company’s Japanese operations during fiscal 2005 resulted in a capital loss carryover of $3,305 for U.S. tax purposes, which expires if not utilized by June 30, 2010. During the third quarter of fiscal 2008, the remaining capital loss carryover became fully reserved for, as it was not more likely than not at that time that no portion of the carryover will be realized during the carryover period. During fiscal 2009, the Company was able to utilize $567 of the loss to offset capital gains that arose due to differences between the book and tax basis for certain of its assets. Further adjustments to this valuation allowance may be necessary in the future if estimates of capital gain income are revised. At June 30, 2009 and 2008, the capital loss carryover was $1,405 and $1,972, respectively.

At June 30, 2009, the Company’s unrecognized tax benefits were $96, all of which would impact the effective tax rate, if recognized. The table below reconciles the beginning and ending amount of unrecognized tax benefits for the fiscal years ended June 30, 2008 and 2009:

Balance, July 1, 2007	$	437
Additions based on tax positions related to the current year		31
Additions for tax positions of prior years		—
Reduction for tax positions of prior years		(28	)
Balance, June 30, 2008	$	440
Additions based on tax positions related to the current year		—
Additions for tax positions of prior years		9
Reduction for tax positions of prior years		(353	)
Balance, June 30, 2009	$	96

It is reasonably possible that the liability associated with the Company’s unrecognized tax benefits will increase or decrease within the next twelve months. These changes may be the result of ongoing audits or the expiration of statutes of limitations. At this time, an estimate of the range of the reasonably possible outcomes cannot be made.

In accordance with the Company’s accounting policy, the Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. At June 30, 2009 and 2008, $43 and $28, respectively, were included in the liability for uncertain tax positions for the possible payment of interest and penalties.

The Company files U.S. federal income tax returns and various state, local and foreign income tax returns. With few exceptions, the Company is no longer subject to U.S. federal, state, local or foreign income tax examinations for fiscal years prior to June 30, 2000.

17.   Net Income (Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share reflects the potential dilution of securities that could share in earnings. When the impact of stock options or other stock-based compensation is anti-dilutive, they are excluded from the calculation.

86

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

17.   Net Income (Loss) per Share — (Continued)

The following table sets forth the reconciliation of the basic and diluted net income (loss) per share computations for the fiscal years ended June 30:

	2009			2008			2007
Numerator:
Net income (loss) used for calculating basic and diluted net income (loss) per share of common stock	$	(75,331	)	$	(84,618	)	$	9,076
Denominator:
Weighted average number of common shares used in the calculation of basic net income (loss) per share		53,547,670			52,861,354			56,133,355
Dilutive effect of outstanding stock options and restricted stock		—			—			264,245
Shares used in the calculation of diluted net income (loss) per share		53,547,670			52,861,354			56,397,600
Net income (loss) per share:
Basic	$	(1.41	)	$	(1.60	)	$	0.16
Diluted	$	(1.41	)	$	(1.60	)	$	0.16

Unvested restricted stock and unexercised stock options to purchase 3,967,927, 6,359,746 and 2,500,831 shares of the Company’s common stock for the fiscal years ended June 30, 2009, 2008 and 2007, respectively, at weighted-average prices per share of $3.08, $5.19 and $7.02, respectively, were not included in the computations of diluted net income per share because their inclusion would have been anti-dilutive.

18.   Enterprise-Wide Disclosures

The Company is comprised principally of operations in North America, Europe and Asia. Non-U.S. market research is comprised of operations in United Kingdom, Canada, France, Germany, Hong Kong, Singapore and China. There were no intercompany transactions that materially affected the financial statements, and all intercompany sales have been eliminated upon consolidation.

The Company’s business model for offering custom market research is consistent across the geographic regions in which it operates. Geographic management facilitates local execution of the Company’s global strategies. The Company maintains global leaders with responsibility across all geographic regions for the majority of its critical business processes, and the most significant performance evaluations and resources allocations made by the Company’s chief operating decision-maker are made on a global basis. Accordingly, the Company has concluded that it has one reportable segment.

The Company has prepared the financial results for geographic information on a basis that is consistent with the manner in which management internally disaggregates information to assist in making internal operating decisions. The Company has allocated common expenses among these geographic regions differently than it would for stand-alone information prepared in accordance with

87

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

18.   Enterprise-Wide Disclosures — (Continued)

accounting principles generally accepted in the United States of America. Geographic operating income (loss) may not be consistent with measures used by other companies.

Geographic information from continuing operations for the fiscal years ended June 30 was as follows:

	2009			2008			2007
Revenue from services
United States	$	112,821		$	152,894		$	159,843
United Kingdom		32,454			43,771			43,655
Canada		19,939			24,628			—
Other European countries		14,536			14,910			8,305
Asia		4,584			2,520			—
Total revenue from services	$	184,334		$	238,723		$	211,803
Operating income (loss)(1)(2)
United States	$	(41,406	)	$	(54,492	)	$	9,802
United Kingdom		(3,431	)		(9,015	)		2,748
Canada		(5,539	)		(7,366	)		—
Other European countries		(5,048	)		(10,914	)		(14	)
Asia		(1,025	)		(2,784	)		(219	)
Total operating income (loss)	$	(56,449	)	$	(84,571	)	$	12,317
Long-lived assets
United States	$	4,879		$	6,733		$	7,298
Canada		1,693			2,858			—
United Kingdom		1,039			1,812			2,261
Other European countries		301			340			343
Asia		103			210			—
Total long-lived assets	$	8,015		$	11,953		$	9,902
Deferred tax assets (liabilities)
United States	$	—		$	18,218		$	17,064
Canada		(2,018	)		(3,191	)		—
United Kingdom		283			347			318
Other European countries		(512	)		(844	)		(859	)
Asia		—			—			—
Total deferred tax assets (liabilities)	$	(2,247	)	$	14,530		$	16,523

(1) Operating loss for fiscal 2009 included a $40,250 goodwill impairment charge. The charge was allocated to the Company’s geographic locations, specifically, $28,888 to the United States, $3,315 to the United Kingdom, $2,435 to Canada, $4,873 to other European countries, and $739 to Asia.

88

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

18.   Enterprise-Wide Disclosures — (Continued)

(2) Operating loss for fiscal 2008 included a $86,497 goodwill impairment charge. The charge was allocated to the Company’s geographic locations, specifically, $58,376 to the United States, $9,472 to the United Kingdom, $5,921 to Canada, $11,150 to other European countries, and $1,578 to Asia.

19.   Commitments and Contingencies

The Company has several non-cancelable operating leases for office space and equipment. Certain of the lease agreements contain rent escalation clauses based on increases in the Consumer Price Index or the landlords’ operating costs. Rent expense under such agreements is recorded using the straight-line method over the term of the lease. Future minimum lease payments under non-cancelable operating leases at June 30, 2009 were as follows:

Fiscal Years Ending June 30:
2010	$	6,464
2011		4,893
2012		4,162
2013		3,280
2014		3,293
2015 and thereafter		4,579

Total rental expense for operating leases during the fiscal years ended June 30, 2009, 2008 and 2007 was $6,938, $7,193 and $7,536, respectively.

20.   Legal Proceedings

In the normal course of business, the Company is at times subject to pending and threatened legal actions and proceedings. After reviewing with counsel pending and threatened actions and proceedings which existed at June 30, 2009 or which arose subsequent to that date but before the filing of this report on Form 10-K, management believes that the outcome of such actions or proceedings will not have a material adverse effect on the Company’s business, financial condition or results of operations.

21.   Related-Party Transactions

On December 16, 2008, the Company entered into an agreement (the “Alix Agreement”) with AlixPartners LLP (“Alix”) pursuant to which Deborah Rieger-Paganis, an employee of Alix, served as interim Chief Financial Officer (“CFO”) of the Company from December 20, 2008 through June 1, 2009. The Alix Agreement, among its material terms, provided for the engagement of Alix to provide interim management, financial advisory, and consulting services to the Company, including:

•  Alix’s agreement to provide Ms. Rieger-Paganis to serve as interim Chief Financial Officer of the Company at an hourly rate plus out-of-pocket expenses,

•  Alix’s agreement to provide other consulting assistance to the Company at hourly rates dependent upon the particular consultant involved,

•  payment by the Company of a retainer to Alix, refundable to the extent not earned,

89

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

21.   Related-Party Transactions — (Continued)

•  agreement of Alix to preserve the confidentiality of non-public confidential and proprietary information received in the course of the engagement,

•  preservation of intellectual property rights of Alix in its methodologies, processes, and the like, and ownership by the Company of work product created specifically for the Company,

•  agreement of the Company to provide specified insurance and to indemnify Alix under specified circumstances,

•  ability of Alix or the Company to terminate the arrangement at will,

•  limitation of Alix liability, and

•  arbitration of disputes.

In addition, the Company had separately engaged Alix beginning in July 2008 to provide performance improvement, financial advisory and consulting services to the Company on an hourly basis. For the fiscal year ended June 30, 2009, the Company incurred $3,263 in expenses related to services provided by Alix, of which $3,096 and $167 were reported in the “Restructuring and other charges” and “Selling, general and administrative” lines, respectively, of the Company’s consolidated statement of operations for the period then ended. Of those expenses, $658 were in relation to the interim CFO arrangement described above.

22.   Supplemental Cash Flow Information

Cash paid (received) during the fiscal years ended June 30 for interest and taxes was as follows:

	2009			2008		2007
Interest	$	1,643		$	1,065	$	(2,057	)
Taxes	$	(621	)	$	2,879	$	3,153

23.   Unaudited Quarterly Results of Operations

The following table presents unaudited consolidated quarterly statements of continuing operations data for the fiscal years ended June 30, 2009 and 2008. In management’s opinion, this information has been prepared on the same basis as the audited consolidated financial statements and includes all adjustments, consisting only of normal recurring adjustments necessary for the fair statement of the unaudited information in the periods presented. This information should be read in conjunction with the consolidated financial statements and related notes included under this Item 8 and in conjunction with other financial information included elsewhere in this Form 10-K. The results of

90

HARRIS INTERACTIVE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended June 30, 2009, 2008 and 2007

23.   Unaudited Quarterly Results of Operations — (Continued)

operations for any quarter are not necessarily indicative of results that may be expected for any future periods.

	Three Months Ended
	Sept. 30,			Dec. 31,			Mar. 31,			June 30,			Sept. 30,			Dec. 31,			Mar. 31,			June 30,
	2007			2007			2008			2008			2008			2008			2009			2009
	(In thousands, except per share data)
Revenue from services(1)	$	55,186		$	62,715		$	57,322		$	63,500		$	50,280		$	50,660		$	39,917		$	43,477
Operating expenses:
Cost of services(1)		32,672			36,128			34,150			37,628			31,151			31,412			24,912			27,760
Selling, general and administrative		18,975			20,966			20,980			22,164			19,608			17,117			15,159			13,794
Depreciation and amortization		1,907			2,267			2,161			2,190			2,083			1,912			1,832			1,783
Restructuring and other charges		—			—			1,900			2,709			628			5,844			5,341			198
Goodwill impairment charge		—			—			—			86,497			—			40,250			—			—
Total operating expenses		53,554			59,361			59,191			151,188			53,470			96,535			47,244			43,535
Operating income (loss)		1,632			3,354			(1,869	)		(87,688	)		(3,190	)		(45,875	)		(7,327	)		(58	)
Interest and other income		372			307			230			210			190			135			54			21
Interest expense		(440	)		(523	)		(514	)		(474	)		(455	)		(1,374	)		(647	)		(955	)
Income (loss) from continuing operations before income taxes		1,564			3,138			(2,153	)		(87,952	)		(3,455	)		(47,114	)		(7,920	)		(992	)
Provision (benefit) for income taxes		546			1,112			(20	)		(2,299	)		(1,194	)		18,509			(1,209	)		(257	)
Income (loss) from continuing operations		1,018			2,026			(2,133	)		(85,653	)		(2,261	)		(65,623	)		(6,711	)		(735	)
Income (loss) from discontinued operations		124			—			—			—			—			—			—			—
Net income (loss)	$	1,142		$	2,026		$	(2,133	)	$	(85,653	)	$	(2,261	)	$	(65,623	)	$	(6,711	)	$	(735	)
Basic net income (loss) per share:
Continuing operations	$	0.02		$	0.04		$	(0.04	)	$	(1.61	)	$	(0.04	)	$	(1.23	)	$	(0.12	)	$	(0.01	)
Discontinued operations		0.00			—			—			—			—			—			—			—
Basic net income (loss) per share	$	0.02		$	0.04		$	(0.04	)	$	(1.61	)	$	(0.04	)	$	(1.23	)	$	(0.12	)	$	(0.01	)
Diluted net income (loss) per share:
Continuing operations	$	0.02		$	0.04		$	(0.04	)	$	(1.61	)	$	(0.04	)	$	(1.23	)	$	(0.12	)	$	(0.01	)
Discontinued operations		0.00			—			—			—			—			—			—			—
Diluted net income (loss) per share	$	0.02		$	0.04		$	(0.04	)	$	(1.61	)	$	(0.04	)	$	(1.23	)	$	(0.12	)	$	(0.01	)

(1) Gross profit, not shown above, can be derived by subtracting the Company’s cost of services from its revenue from services for each of the periods shown above.

Index to Financial Statement Schedules

Schedule II — Valuation Qualifying Accounts 95

91

Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.   Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) that are designed to ensure that information required to be disclosed in reports that the Company files or submits pursuant to the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of each fiscal quarter and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, the Company’s management conducts an evaluation of the effectiveness of the Company’s disclosure controls and procedures. It is the conclusion of the Company’s Chief Executive Officer and Chief Financial Officer, based upon an evaluation completed as of June 30, 2009, the end of the most recent fiscal quarter covered by this Annual Report on Form 10-K, that the Company’s disclosure controls and procedures were effective.

Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America.

The Company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the Company’s consolidated financial statements. Internal control over financial reporting includes the controls themselves, monitoring and internal auditing practices and actions taken to correct deficiencies as identified.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its evaluation, management concluded that the Company’s internal control over financial reporting was effective as of June 30, 2009.

This annual report on Form 10-K does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting.

92

Management’s report on internal control over financial reporting was not subject to attestation by the Company’s independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report on Form 10-K.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the quarter ended June 30, 2009 that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Item 9B.   Other Information

None.

PART III

Item 10.   Directors, Executive Officers and Corporate Governance

The information required by Item 10 of Form 10-K with respect to our directors is incorporated by reference from the information contained in the section captioned “Proposal No. 1— Election of Directors” in our definitive Proxy Statement for the Annual Meeting of Stockholders to be held on October 27, 2009 (the “Proxy Statement”), a copy of which will be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended June 30, 2009. The information required by Item 10 of Form 10-K with respect to our executive officers is incorporated by reference from “Item 1 — Business — Executive Officers of Harris Interactive” of this Annual Report on Form 10-K.

The information required by Item 10 of Form 10-K with respect to the identification of our Audit Committee and Audit Committee financial expert is incorporated by reference from the information contained in the section captioned “Corporate Governance — Committees of the Board — Audit Committee” in the Proxy Statement.

The information required by Item 10 of Form 10-K with respect to compliance with Section 16(a) of the Exchange Act is incorporated by reference from the information contained in the section captioned “Section 16(a) Beneficial Ownership Reporting Compliance” in the Proxy Statement.

Our employees, officers, directors, representatives, consultants, contractors, and agents are subject to our Code of Ethics. An Addendum to the Code of Ethics contains additional requirements for our Chief Executive Officer and senior financial officers. The Code of Ethics and Addendum are available in the Investor Relations section of our website at www.harrisinteractive.com. We intend to satisfy the disclosure requirements of Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of our Code of Ethics or the Addendum applicable to our Chief Executive Officer and senior financial officers by posting such information in the Investor Relations section of our website.

Item 11.   Executive Compensation

The information required by Item 11 of Form 10-K is incorporated by reference from the information contained in the sections captioned “Compensation Discussion and Analysis”, “Compensation of Directors and Executive Officers”, “Corporate Governance — Committees of the Board — Compensation Committee — Compensation Committee Interlocks and Insider Participation” and “Compensation Committee Report” in the Proxy Statement.

93

Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by Item 12 of Form 10-K is incorporated by reference from the information contained in the section captioned “Stock Ownership and Reporting” in the Proxy Statement.

Item 13.   Certain Relationships and Related Transactions, and Director Independence

The information required by Item 13 of Form 10-K with respect to transactions with related persons is incorporated by reference from the information contained in the section captioned “Transactions with Related Persons” in the Proxy Statement.

The information required by Item 13 of Form 10-K with respect to director independence is incorporated by reference from the information contained in the section captioned “Corporate Governance — Director Independence” in the Proxy Statement.

Item 14.   Principal Accountant Fees and Services

The information required by Item 14 of Form 10-K is incorporated by reference from the information contained in the section captioned “Proposal No. 2— Ratification of the Appointment of Independent Registered Public Accounting Firm” in the Proxy Statement.

PART IV

Item 15.   Exhibit and Financial Statements Schedules

Financial Statements

Reference is made to Item 8, “Financial Statements and Supplementary Data,” of Part II of this Form 10-K.

Exhibits

Reference is made to the Index of Exhibits accompanying this Form 10-K as filed with the Securities and Exchange Commission. The Company will furnish to any shareholder, upon written request, any exhibit listed in such Index of Exhibits upon payment by such shareholder of the Company’s reasonable expenses in furnishing such exhibit.

94

Schedule II
Valuation and Qualifying Accounts
(In thousands)

	Balance at		Additions		Deductions		Balance
	Beginning		Charged to		Amounts		at End
	of Period		Earnings		Written Off		of Period
Fiscal year ended June 30, 2007
Deducted in the consolidated balance sheet:
Allowance for doubtful accounts receivable	$	70	$	34	$	22	$	82
Deferred tax valuation allowance	$	1,794	$	—	$	998	$	796
Fiscal year ended June 30, 2008
Deducted in the consolidated balance sheet:
Allowance for doubtful accounts receivable	$	82	$	442	$	42	$	482
Deferred tax valuation allowance	$	796	$	541	$	48	$	1,289
Fiscal year ended June 30, 2009
Deducted in the consolidated balance sheet:
Allowance for doubtful accounts receivable	$	482	$	381	$	84	$	779
Deferred tax valuation allowance	$	1,289	$	22,878	$	618	$	23,549

95

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized,

HARRIS INTERACTIVE INC.

Date: August 31, 2009

By:  /s/  Robert J. Cox

Robert J. Cox

Executive Vice President, Chief

Financial Officer and

Treasurer

(On Behalf of the Registrant and as

Principal Financial Officer)

96

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints, jointly and severally, Kimberly Till and Robert J. Cox and each of them, as his true and lawful attorneys-in-fact and agents, each with full power of substitution, for him, and in his name, place and stead, in any and all capacities, to sign any amendments to this Report on Form 10-K, and to file the same, with Exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Name	Capacity	Date
/s/  Kimberly Till Kimberly Till	President and Chief Executive Officer (Principal Executive Officer) and Director	August 31, 2009
/s/  Robert J. Cox Robert J. Cox	Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)	August 31, 2009
/s/  Eric W. Narowski Eric W. Narowski	Senior Vice President and Global Controller (Principal Accounting Officer)	August 31, 2009
/s/  George Bell George Bell	Director	August 31, 2009
/s/  David Brodsky David Brodsky	Director	August 31, 2009
/s/  Steven L. Fingerhood Steven L. Fingerhood	Director	August 31, 2009
/s/  Stephen D. Harlan Stephen D. Harlan	Director	August 31, 2009
/s/  James R. Riedman James R. Riedman	Director	August 31, 2009
/s/  Howard L. Shecter Howard L. Shecter	Director	August 31, 2009
/s/  Antoine G. Treuille Antoine G. Treuille	Director	August 31, 2009

97

INDEX OF EXHIBITS

Exhibit
Number			Exhibit Title
	2	.1	Agreement and Plan of Merger, dated August 5, 2001, among Harris Interactive Inc. (the “Company”), Total Merger Sub Inc., and Total Research Corporation (filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed August 14, 2001 and incorporated herein by reference).
	2	.2	Share Purchase Agreement dated March 2, 2004 among Harris Interactive International Inc. (“HII”) and the Shareholders of Novatris, S.A. (filed as Exhibit 10.1 to the Company’s Registration Statement on Form S-3 filed March 8, 2004 (Registration No. 333-113389) and incorporated herein by reference).
	2	.3	Share Purchase Agreement dated August 16, 2007 by and among the Company, 2144798 Ontario Inc., and all the stockholders of Decima Research Inc. (filed as Exhibit 2.1.1 to the Company’s Current Report on Form 8-K filed August 16, 2007 and incorporated herein by reference).
	2	.4	Amendment to Share Purchase Agreement by and among the Company, 2144798 Ontario Inc. and the former stockholders of Decima Research Inc. executed on January 25, 2009 and effective as of January 1, 2009 (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed January 29, 2008 and incorporated herein by reference).
	2	.5	Agreement Relating to the Sale and Purchase of the Entire Issued Share Capitals of Marketshare Limited and Marketshare Pte Ltd dated August 16, 2007 by and among Harris Interactive Asia Limited, HII, and all the stockholders of Marketshare Limited and Marketshare Pte Ltd (filed as Exhibit 2.1.6 to the Company’s Current Report on Form 8-K filed August 16, 2007 and incorporated herein by reference).
	3	.1	Amended and Restated Certificate of Incorporation of the Company (filed as Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2000 and incorporated herein by reference).
	3	.2	By-laws of the Company (filed as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2001 and incorporated herein by reference).
	3	.3	Certificate of Designation, Preferences and Rights of Series A Preferred Stock of the Company (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed March 14, 2005 and incorporated herein by reference).
	4	.1	Rights Agreement, dated as of March 11, 2005, by and between the Company and American Stock Transfer & Trust Company, as Rights Agent (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed March 14, 2005 and incorporated herein by reference).
	10	.1.1*	Long-Term Incentive Plan of the Company (included as Appendix B to the Company’s Definitive Proxy Statement on Schedule 14A filed October 8, 2004 and incorporated herein by reference).
	10	.1.2*	2007 Long-Term Incentive Plan of the Company (included as Appendix A to the Company’s Definitive Proxy Statement on Schedule 14A filed September 12, 2007 and incorporated herein by reference).
	10	.1.3*	Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.3 to the Company’s Registration Statement on Form S-8 filed December 14, 2004 (Registration No. 333-121250) and incorporated herein by reference).
	10	.1.4*	Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2006 and incorporated herein by reference)
	10	.1.5*	Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).

98

Exhibit
Number			Exhibit Title
	10	.1.6*	Form of Non-Qualified Stock Option Agreement — Employees (filed as Exhibit 10.2 to the Company’s Registration Statement on Form S-8 filed on December 10, 2007 (Registration No. 333-147974) and incorporated herein by reference).
	10	.1.7*	Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 and incorporated herein by reference).
	10	.1.8*	Form of Non-Qualified Stock Option Agreement — Grants After May 1, 2008 (filed as Exhibit 10.1.22 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.1.9*	Form of Incentive Stock Option Agreement (filed as Exhibit 10.4 to the Company’s Registration Statement on Form S-8 filed December 14, 2004 (Registration No. 333-121250) and incorporated herein by reference).
	10	.1.10*	Letter Amending Stock Option Agreements (2008) (filed as Exhibit 10.1.25 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.1.11*	Form of Restricted Stock Agreement (Non-Employee Directors) (filed as Exhibit 10.3 to the Company’s Registration Statement on Form S-8 filed on December 10, 2007 (Registration No. 333-147974) and incorporated herein by reference).
	10	.1.12*	Form of Restricted Stock Agreement (Non-Employee Directors) (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 and incorporated herein by reference).
	10	.1.13	Form of Restricted Stock Agreement — Director Grants After May, 1, 2008 (filed as Exhibit 10.1.24 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.1.14*	Form of Restricted Stock Agreement (Employee Participant) (filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2006 and incorporated herein by reference).
	10	.1.15*	Form of Restricted Stock Agreement (Employee Participant) (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2006 and incorporated herein by reference.)
	10	.1.16*	Form of Restricted Stock Agreement (Employee Participant) (filed as Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).
	10	.1.17*	Form of Restricted Stock Agreement (Employee Participant) (2007 Performance Based Award Grants) (filed as Exhibit 10.1.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.1.18*	Form of Restricted Stock Agreement (Employee Participant) (filed as Exhibit 10.4 to the Company’s Registration Statement on Form S-8 filed on December 10, 2007 (Registration No. 333-147974) and incorporated herein by reference).
	10	.1.19*	Form of Restricted Stock Agreement (Employee Participant) (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 and incorporated herein by reference).
	10	.1.20*	Form of Restricted Stock Agreement — Employee Grants After May 1, 2008 (filed as Exhibit 10.1.23 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.1.21*	Form of Restricted Stock Unit Agreement (Canadian employees) (filed as Exhibit 10.1.19 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).

99

Exhibit
Number			Exhibit Title
	10	.1.22*	Form of Non-Qualified Stock Option Agreement between the Company and certain employees of Novatris, S.A. dated as of March 2, 2004 (filed as Exhibit 4.2 to the Company’s Registration Statement on Form S-8 filed March 8, 2004 (Registration No. 333-113392) and incorporated herein by reference).
	10	.1.23*	Non-Qualified Stock Option Agreement (Time-Based Vesting) between the Company and Enzo Micali, dated as of May 15, 2009 (filed herewith).
	10	.1.24*	Form of Restricted Stock Agreement (2008 performance based award grants to Gregory T. Novak and Ronald E. Salluzzo) (filed as Exhibit 10.1.20 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.1.25*	Form of Non-Qualified Stock Option Agreement between the Company and Ronald E. Salluzzo, dated as of March 6, 2006 (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed February 17, 2006 and incorporated herein by reference).
	10	.1.26*	Non-Qualified Stock Option Agreement (Performance-Based Vesting) between the Company and Kimberly Till, dated as of October 21, 2008 (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed October 22, 2008 and incorporated herein by reference).
	10	.1.27*	Non-Qualified Stock Option Agreement (Time-Based Vesting) between the Company and Kimberly Till, dated as of October 21, 2008 (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed October 22, 2008 and incorporated herein by reference).
	10	.2.1*	1999 Employee Stock Purchase Plan of the Company (included as Appendix C to the Company’s Definitive Proxy Statement on Schedule 14A filed October 8, 2004 and incorporated herein by reference).
	10	.2.2*	Form of Subscription Agreement under 1999 Employee Stock Purchase Plan of the Company (included as Exhibit A to Exhibit 10.2 to the Company’s Registration Statement on Form S-1 filed September 17, 1999 (Registration No. 333-87311) and incorporated herein by reference).
	10	.2.3*	2007 Employee Stock Purchase Plan of the Company (included as Appendix B to the Company’s Definitive Proxy Statement on Schedule 14A filed September 12, 2007 and incorporated herein by reference).
	10	.2.4*	Harris Interactive UK Limited Share Incentive Plan (relating to shares of Harris Interactive Inc.) (filed as Exhibit 4.3 to the Company’s Registration Statement on Form S-8 filed March 20, 2008 (Registration No. 333-149831) and incorporated herein by reference).
	10	.2.5*	Harris Interactive UK Limited Share Incentive Plan Partnership and Matching Share Agreement (filed as Exhibit 4.4 to the Company’s Registration Statement on Form S-8 filed March 20, 2008 (Registration No. 333-149831) and incorporated herein by reference).
	10	.2.6*	Trust Deed between Harris Interactive UK Limited and Equiniti Share Plan Trustees related to Harris Interactive UK Limited Share Incentive Plan (filed as Exhibit 4.5 to the Company’s Registration Statement on Form S-8 filed March 20, 2008 (Registration No. 333-149831) and incorporated herein by reference).
	10	.3.1	Share Repurchase Program 10b5-1 Plan Document, dated as of March 9, 2007 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed March 12, 2007 and incorporated herein by reference).
	10	.4.1*	Employment Agreement dated August 16, 2007 between Decima Research Inc. and Bruce Anderson (filed as Exhibit 2.1.3 to the Company’s Current Report on Form 8-K filed August 16, 2007 and incorporated herein by reference).
	10	.4.2*	Separation Agreement between the Company and David Bakken, dated March 30, 2009 (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2009 and incorporated herein by reference).

100

Exhibit
Number			Exhibit Title
	10	.4.3*	Employment Agreement between the Company and Leonard R. Bayer, dated as of April 30, 2007 (filed as Exhibit 10.11 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).
	10	.4.4*	Employment Agreement Amendment 1 between the Company and Leonard R. Bayer, dated February 26, 2008 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 27, 2008 and incorporated herein by reference).
	10	.4.5*	Separation Agreement between the Company and Dennis K. Bhame, dated March 16, 2009 (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2009 and incorporated herein by reference).
	10	.4.6*	Employment Agreement between the Company and Robert J. Cox, effective as of June 1, 2009 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 2, 2009 and incorporated herein by reference).
	10	.4.7*	Letter Agreement between the Company and Frank E. Forkin, dated June 2, 2009 (filed herewith).
	10	.4.8*	Letter Agreement between the Company and Patti B. Hoffman, dated May 11, 2009 (filed herewith).
	10	.4.9*	Letter Agreement between the Company and Enzo Micali, dated March 24, 2009 (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2009 and incorporated herein by reference).
	10	.4.10*	Employment Agreement between the Company and Gregory T. Novak, dated as of April 30, 2007 (filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).
	10	.4.11*	Employment Agreement Amendment 1 between the Company and Gregory T. Novak dated February 8, 2008 (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2007 and incorporated herein by reference).
	10	.4.12*	Employment Agreement Amendment 2 between the Company and Gregory T. Novak dated as of October 21, 2008 (filed as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed October 22, 2008 and incorporated herein by reference).
	10	.4.13*	Employment Agreement between the Company and Ronald E. Salluzzo, dated as of April 30, 2007 (filed as Exhibit 10.9 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).
	10	.4.14*	Employment Agreement Amendment 1 between the Company and Ronald E. Salluzzo dated February 8, 2008 (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2007 and incorporated herein by reference).
	10	.4.15*	Employment Agreement between the Company and Robert Salvoni, dated May 15, 2009 (filed herewith).
	10	.4.16*	Separation Agreement with Stephan B. Sigaud (filed as Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2008 and incorporated herein by reference).
	10	.4.17*	Employment Agreement between the Company and George H. Terhanian, effective as of September 1, 2007 (filed as Exhibit 10.4.34 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.4.18*	Employment Agreement Amendment 1 between the Company and George H. Terhanian dated April 30, 2008 (filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 and incorporated herein by reference).
	10	.4.19*	Employment Agreement Amendment 2 dated December 16, 2008 between the Company and George H. Terhanian (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed December 17, 2008 and incorporated herein by reference).

101

Exhibit
Number			Exhibit Title
	10	.4.20*	Employment Agreement between the Company and Kimberly Till, dated as of October 21, 2008 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed October 22, 2008 and incorporated herein by reference).
	10	.4.21*	Employment Agreement between the Company and David B. Vaden, dated as of April 3, 2006 and effective as of February 20, 2006 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed April 7, 2006 and incorporated herein by reference).
	10	.4.22*	Employment Agreement between the Company and David B. Vaden, effective as of April 30, 2007 (filed as Exhibit 10.10 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 and incorporated herein by reference).
	10	.4.23*	Employment Agreement Amendment 1 between the Company and David B. Vaden dated April 30, 2008 (filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 and incorporated herein by reference).
	10	.4.24*	Form of Change in Control Agreement between the Company and Eric W. Narowski (filed as Exhibit 10.4.43 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.4.25*	Compensation Arrangement for Executive Officer by and between the Company and Eric W. Narowski (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2007 and incorporated herein by reference).
	10	.4.26*	Description of Salary and Bonus Arrangements with Executive Officers — Fiscal 2007 and 2008 (filed as Exhibit 10.4.53 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.4.27*	Description of Salary and Bonus Arrangements with Executive Officers — Fiscal 2008 and 2009 (filed as Exhibit 10.4.59 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.4.28*	Description of Salary and Bonus Arrangements with Executive Officers and Terms of Bonus Plans — Fiscal 2010 (filed herewith)
	10	.4.29*	Description of Cash Bonus Plan as amended August 21, 2006 (filed under Item 1.01 of the Company’s Current Report on Form 8-K filed August 25, 2006 and incorporated herein by reference).
	10	.4.30*	Description of Amended Terms of Corporate Bonus Plan and Business Unit Bonus Plan (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed December 17, 2008 and incorporated herein by reference).
	10	.4.31*	Summary of Compensation Arrangements for Non-Employee Directors of Harris Interactive Inc. (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed May 9, 2006 and incorporated herein by reference).
	10	.4.32*	Summary of Compensation Arrangements for Non-Employee Directors of Harris Interactive, effective as of November 1, 2006 (filed as Exhibit 10.3.43 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2006 and incorporated herein by reference).
	10	.4.33*	Description of Changes to Compensation Arrangements for Non-Employee Directors of Harris Interactive Inc. effective as of September 6, 2007 (filed as Exhibit 10.4.48 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.4.34*	Description of Changes to Compensation Arrangements for Non-Employee Directors of Harris Interactive Inc. effective as of November 15, 2008 (filed as Exhibit 10.4.52 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.4.35*	Agreement with Steven L. Fingerhood dated June 4, 2008 (filed as Exhibit 10.4.53 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).

102

Exhibit
Number			Exhibit Title
	10	.4.36*	Description of Changes to Compensation Arrangements for Non-Employee Directors of Harris Interactive Inc. effective as of November 15, 2009 (filed herewith).
	10	.5	Form of Option Agreement between the Company and certain of the Shareholders of Novatris, S.A. (filed as Exhibit 10.2 to the Company’s Registration Statement on Form S-3 filed March 8, 2004 (Registration No. 333-113389) and incorporated herein by reference).
	10	.6.1	Lease Agreement for 60 and 135 Corporate Woods, Rochester, New York, between the Company and Corporate Woods Associates, LLC, dated February 2, 2007 (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2006 and incorporated herein by reference).
	10	.6.2	Lease Agreement for 70 Carlson Road, Rochester, New York, between Gordon S. Black Corporation and Carlson Park Associates, together with the First and Second amendments thereto, dated July 1, 1998 (filed as Exhibit 10.6.2 to the Company’s Registration Statement on Form S-1 filed September 17, 1999 (Registration No. 333-87311) and incorporated herein by reference).
	10	.6.3	Third Amendment to Lease Agreement for 70 Carlson Road, Rochester, New York, between the Company and 100 Carlson Road LLC, dated March 20, 2003 (filed as Exhibit 10.6.3 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.4	Fourth Amendment to Lease Agreement for 70 Carlson Road, Rochester, New York, between the Company and 100 Carlson Road LLC, dated September 23, 2008 (filed as Exhibit 10.6.3 to the Company’s Quarterly Report on Form 10-K for the fiscal quarter ended September 30, 2008 and incorporated herein by reference).
	10	.6.5	Agreement of Sublease for 161 Avenue of the Americas, New York, New York, between the Company and The McCall Pattern Company, Inc., as successor-in-interest by merger to Butterick Company, Inc., dated as of June 8, 2004 (filed as Exhibit 10.5.4 to the Company’s Current Report on Form 8-K filed March 18, 2005 and incorporated herein by reference).
	10	.6.6	Agreement of Sublease for 161 Avenue of the Americas, New York, New York between the Company and McCann Erickson Inc., dated as of March 29, 2007 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed April 4, 2007 and incorporated herein by reference).
	10	.6.7	Lease Agreement for 1920 Association Drive, Reston, Virginia, between Wirthlin (formerly known as Decima Research) and Richard B. Wirthlin Family LLC, dated April 23, 2002 (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2004 and incorporated herein by reference).
	10	.6.8	First Amendment to Lease Agreement for 1920 Association Drive, Reston, Virginia, between the Company and Richard B. Wirthlin Family LLC, dated as of May 10, 2007 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed May 16, 2007 and incorporated herein by reference).
	10	.6.9	Lease Agreement for Watermans Park, High Street, Brentford (UK), among Procter & Gamble (L&CP Limited), Procter & Gamble (Health & Beauty Care Limited, HI Europe Limited and the Company, dated May 9, 2005 (filed as Exhibit 10.5.10 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005 and incorporated herein by reference).
	10	.6.10	Agreement for Surrender of Watermans Park, High Street, Brentford (UK), among Procter & Gamble (L&CP Limited), Procter & Gamble (Health & Beauty Care Limited, HI Europe Limited and the Company, dated April 4, 2005 (filed as Exhibit 10.5.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005 and incorporated herein by reference).
	10	.6.11	Underlease for Watermans Park, High Street, Brentford (UK), among Crowvale Properties Limited, Max Factor Limited, and International Playtex Inc., dated June 27, 1985 (filed as Exhibit 10.6.10 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).

103

Exhibit
Number			Exhibit Title
	10	.6.12	Rent Review Memorandum for Watermans Park, High Street, Brentford (UK), between Procter & Gamble (L &CP) Limited and HI Europe Limited, dated June 24, 2005 (filed as Exhibit 10.6.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.13	Lease Agreement for 101 Merritt 7, Norwalk, Connecticut, between Merritt 7 Venture LLC and the Company, dated March 27, 2001 (filed as Exhibit 10.5.12 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005 and incorporated herein by reference).
	10	.6.14	Lease amendment Number 1 for 101 Merritt 7, Norwalk, Connecticut, between Merritt 7 Venture LLC and the Company, dated as of January 21, 2005 (filed as Exhibit 10.5.13 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005 and incorporated herein by reference).
	10	.6.15	Second Amendment and Extension to Lease for 101 Merritt 7, Norwalk, Connecticut, between Merritt 7 Venture LLC and the Company, dated October 22, 2007 (filed as Exhibit 10.6.14 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.16	Lease Agreement for 5 Independence Way, Princeton, New Jersey, between Bellemead Development Corporation and Total Research Corporation, dated December 2, 1985, including all amendments to date (filed as Exhibit 10.6.15 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.17	Ninth Amendment and Partial Surrender Agreement to Lease Agreement for 5 Independence Way, Princeton, New Jersey, between Bellemead Development Corporation and the Company, dated September 24, 2008, signed on or about October 27, 2008, and effective December 31, 2008 (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2008 and incorporated herein by reference).
	10	.6.18	Tenth Amendment and Partial Surrender Agreement to Lease Agreement for 5 Independence Way, Princeton, New Jersey, between Bellemead Development Corporation and the Company, dated May 8, 2009, and effective January 1, 2009 (filed herewith).
	10	.6.19	Lease Agreement for Pepper Road, Hazel Grove, Stockport (UK), between Meggitt Properties plc and Business Market Research Limited, dated July 31, 2000 (filed as Exhibit 10.5.15 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2006 and incorporated herein by reference).
	10	.6.20	Rent Review Memorandum for Pepper Road, Hazel Grove, Stockport (UK), between Meggitt Properties plc and Business Market Research Limited dated May 9, 2006 (filed as Exhibit 10.5.16 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2006 and incorporated herein by reference).
	10	.6.21	Lease Agreement for Vanwall Road, Maidenhead (UK) between Seiko UK Limited and HI Europe Limited, dated July 29, 2005 (filed as Exhibit 10.5.17 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2006 and incorporated herein by reference).
	10	.6.22	Lease Agreement for Beim Strohhause 17- 31, 20097, Hamburg, Germany, between Dieter Becken and Media Transfer AG, dated July 8, 2005, including all amendments to date (filed Exhibit 10.6.19 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.23	Lease Agreement for 1080 Beaver Hall Hill, Montreal, Quebec (CAN), between Alexis Nihon Real Estate Investment Trust and Decima Research Inc., dated January 16, 2006 (filed as Exhibit 10.6.20 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).

104

Exhibit
Number			Exhibit Title
	10	.6.24	Lease Agreement for 160 Elgin Street, Ottawa, Ontario (CAN), between 160 Elgin Leaseholds Inc. and Decima Research Inc., dated January 19, 2006 (filed as Exhibit 10.6.21 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.25	Lease Agreement for 2345 Yonge Street, Toronto, Ontario (CAN), between Stockton & Bush 2345 Limited and OSI Group Inc., dated May 1, 2002 (filed as Exhibit 10.6.22 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.26	Office License for 2345 Yonge Street, Toronto, Ontario (CAN), between Decima Research Inc. and Westmount Decision Science Inc., dated September 1, 2007 (filed as Exhibit 10.6.23 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 and incorporated herein by reference).
	10	.6.27	Agreement for 463-483 Lockhart Road, Hong Kong, between Marketshare Limited and Gilroy Company Limited, dated May 28, 2007 (filed herewith)
	10	.6.28	Tenancy Agreement for 463-483 Lockhart Road, Hong Kong, between Marketshare Limited and Gilroy Company Limited, dated December 14, 2007 (filed herewith)
	10	.6.29	Supplemental Agreement for 463-483 Lockhart Road, Hong Kong, between Marketshare Limited and Gilroy Company Limited, dated April 21, 2008 (filed herewith)
	10	.7.1	Credit Agreement dated September 21, 2007 between JPMorgan Chase Bank, N.A., as Administrative Agent, the lenders parties thereto and the Company (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed September 26, 2007 and incorporated herein by reference).
	10	.7.2	Master Guaranty dated September 21, 2007 made by Louis Harris & Associates, Inc., Wirthlin Worldwide, LLC, Harris Interactive International Inc., Harris International Asia, LLC, and The Wirthlin Group International, L.L.C. in favor of JPMorgan Chase Bank, N.A., as Administrative Agent, for itself and the Lenders parties to the Credit Agreement (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed September 26, 2007 and incorporated herein by reference).
	10	.7.3	Form of Master Securities Pledge Agreement to be delivered at option of the Company or its domestic subsidiary, as applicable, in favor of JPMorgan Chase Bank, N.A., as Administrative Agent, for itself and the Lenders parties to the Credit Agreement (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed September 26, 2007 and incorporated herein by reference).
	10	.7.4	Interest Rate Swap Confirmation by and between the Company and JPMorgan Chase Bank, N.A., dated as of July 2, 2007 (filed as Exhibit 10.7.9 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and incorporated herein by reference).
	10	.7.5	Amendment to Interest Rate Swap Confirmation by and between the Company and JPMorgan Chase Bank, N.A., dated as of September 21, 2007 (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2007 and incorporated herein by reference).
	10	.7.6	Waiver and Amendment Agreement Number 1 to that certain Credit Agreement, dated as of February 5, 2009, and effective as of December 31, 2008, among JPMorgan Chase Bank, National Association, the Lenders Party Thereto, and the Company, incorporating as Annex I thereto the Credit Agreement dated September 21, 2007, and amended as of December 31, 2008 (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2008 and incorporated herein by reference).
	10	.7.7	Waiver and Amendment Agreement No. 2 to that certain Credit Agreement, dated as of March 6, 2009, among JPMorgan Chase Bank, National Association, the Lenders Party Thereto, and the Company (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed March 9, 2009 and incorporated herein by reference).

105

Exhibit
Number			Exhibit Title
	10	.7.8	Waiver and Amendment Agreement No. 3 to that certain Credit Agreement, dated as of May 6, 2009, among JPMorgan Chase Bank, National Association, the Lenders Party Thereto, and the Company (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed May 7, 2009 and incorporated herein by reference).
	10	.8.1	Amended and Restated Investment Agreement between Riedman Corporation and the Company dated October 15, 1991 (filed as Exhibit 10.12 to the Company’s Registration Statement on Form S-1/A filed October 26, 1999 (Registration No. 333-87311) and incorporated herein by reference).
	10	.8.2	Registration Agreement between the Company and Riedman Corporation dated as of October 15, 1999 (filed as Exhibit 10.17 to the Company’s Registration Statement on Form S-1/A filed October 26, 1999 (Registration No. 333-87311) and incorporated herein by reference).
	10	.9*	Agreement dated December 16, 2008 between the Company and Alix Partners LLP (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed December 17, 2008 and incorporated herein by reference).
	10	.11	Non-Competition Agreement dated August 16, 2007 by and among Decima Research Inc., 2144798 Ontario Inc., Bruce Anderson, Kevin Loiselle, Michel Lucas, Daniel Kirkland, and Ed Hum (filed as Exhibit 2.1.2 to the Company’s Current Report on Form 8-K filed August 16, 2007 and incorporated herein by reference).
	21		List of Subsidiaries (filed herewith).
	23		Consent of Independent Registered Public Accounting Firm (filed herewith).
	24		Power of Attorney (included on page 97 of this Report).
	31	.1	Certificate of the Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith).
	31	.2	Certificate of the Chief Financial Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith).
	32	.1	Certificate of the Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 906 of the Sarbanes-Oxley Act of 2002) (filed herewith).
	32	.2	Certificate of the Chief Financial Officer pursuant to 18 U.S.C. §1350 (Section 906 of the Sarbanes-Oxley Act of 2002) (filed herewith).

*  Denotes management contract or compensatory plan or arrangement.

106

EX-10.1.23

Exhibit 10.1.23

NON-QUALIFIED STOCK OPTION AGREEMENT

     THIS AGREEMENT, entered into as of the Grant Date (as defined in Section 1), by and between the Participant and Harris Interactive Inc. (the “Company”);

WITNESSETH THAT:

     WHEREAS, the Company maintains the Harris Interactive Inc. Long-Term Incentive Plan (the “Plan”), which is incorporated into and forms a part of this Agreement, and the Participant has been selected by the committee administering the Plan (the “Committee”) to receive a Non-Qualified Stock Option Award under the Plan;

     NOW, THEREFORE, IT IS AGREED, by and between the Company and the Participant, as follows:

     1. Terms of Award. The following terms used in this Agreement shall have the meanings set forth in this Section 1:

          (a) The “Participant” is Enzo Micali.

          (b) The “Grant Date” is May 15, 2009.

          (c) The number of “Covered Shares” shall be 200,000 shares of Stock.

          (d) The “Initial Exercise Date” is the one-year anniversary of the Grant Date.

          (e) The “Exercise Price” is $0.38 per share.

Other terms used in this Agreement are defined in Section 9 and elsewhere in this Agreement.

     2. Award and Exercise Price. The Participant is hereby granted an option (the “Option”) to purchase the number of Covered Shares of Stock at the Exercise Price per share as set forth in Section 1. The Option is not intended to qualify as an “Incentive Stock Option,” as defined in the Plan and in Section 422(b) of the Code.

     3. Date of Exercise.

     (a) The Option shall become exercisable (shall vest) with respect to:

(i)     1/4^th of the Covered Shares as of the Initial Exercise Date; and

(ii)    1/48^th of the Covered Shares as of the end of each of the next 36 calendar months thereafter,

provided, however, that to the extent that the Option has not become exercisable (vested) on or before the Participant’s Date of Termination, such Option shall no longer become exercisable (vest) in accordance with the foregoing schedule as of any date subsequent to the Participant’s Date of Termination except as provided in the immediately following paragraphs. Exercisability under this schedule is cumulative, and after the Option becomes exercisable under the schedule with respect to any portion of the Covered Shares, it shall continue to be exercisable with respect to that portion, and only that portion, of the Covered Shares until the Expiration Date (described in Section 4 below).

     (b) Notwithstanding Section 3(a), the Option shall become immediately exercisable (vest) with respect to all of the Covered Shares (whether or not previously vested) upon the occurrence of the Participant’s Date of Termination by reason of the Participant’s death or Disability if such Date of Termination is after the Initial Exercise Date.

     (c) Notwithstanding Section 3(a), the Option shall become immediately exercisable (vest) with respect to all of the Covered Shares (whether or not previously vested) upon the date of a Change in Control if the Participant’s Date of Termination does not occur before such Change in Control and a Complying Assumption does not occur in connection with the Change in Control. If a Complying Assumption occurs in connection with the Change in Control, then the Option shall become immediately exercisable (vest) with respect to all of the Covered Shares (whether or not previously vested) if the Participant’s Date of Termination occurs upon or in the one-year period immediately following a Change in Control (as defined in the Plan) unless such Date of Termination is due to termination of Participant by the Company for Cause or Participant’s voluntary termination of his or her employment without Good Reason.

     4. Expiration. The Option, to the extent not theretofore exercised, shall not be exercisable on or after the Expiration Date. The “Expiration Date” shall be earliest to occur of:

          (a) the ten-year anniversary of the Grant Date;

          (b) if the Participant’s Date of Termination occurs by reason of Disability or death, the one-year anniversary of such Date of Termination;

          (c) if the Participant’s Date of Termination occurs for reasons other than death or Disability, sixty days after the Date of Termination; and

          (d) the date of any breach by Participant of his or her obligations under Section 8 of this Agreement.

In the event of the Participant’s death while in the employ of the Company, the Participant’s executors or administrators (or the person or persons to whom the Participant’s rights under the Option shall have passed by the Participant’s will or by the laws of descent and distribution) may exercise, any unexercised portion of the Option to the extent such exercise is otherwise permitted by this Agreement.

     Any Option exercised subsequent to the Participant’s Date of Termination as permitted hereunder shall be exercisable only to the extent vested at the time of the Participant’s Date of Termination, regardless of the reason for the termination, and no extension of time beyond the Participant’s Date of Termination shall permit exercise beyond the date such Option would otherwise expire if no termination had occurred.

     5. Method of Option Exercise. The Option may be exercised in whole or in part by filing a written notice with, and which must be received by, the Secretary of the Company at its corporate headquarters prior to the Expiration Date. Such notice shall (a) specify the number of shares of Stock which the Participant elects to purchase; provided, however, that not less than one hundred (100) shares of Stock may be purchased at any one time unless the number purchased is the total number of shares available for purchase at that time under the Option, and (b) be accompanied by payment of the Exercise Price for such shares of Stock indicated by the Participant’s election. Payment shall be by cash or by check payable to the Company, or, at the discretion of the Committee at any time: (a) all or a portion of the Exercise Price may be paid by the Participant by delivery of shares of Stock acceptable to the Committee (including, if the Committee so approves, the withholding of shares otherwise issuable upon exercise of the

Option) and having an aggregate Fair Market Value (valued as of the date of exercise) that is equal to the amount of cash that would otherwise be required; and (b) the Participant may pay the Exercise Price by authorizing a third party to sell shares of Stock (or a sufficient portion of the shares) acquired upon exercise of the Option and remit to the Company a sufficient portion of the sale proceeds to pay the entire Exercise Price and any tax withholding resulting from such exercise.

     6. Withholding. All distributions under this Agreement are subject to withholding of all applicable taxes. At the election of the Participant, and subject to such rules as may be established by the Committee, such withholding obligations may be satisfied through the surrender of shares of Stock which the Participant already owns, or to which the Participant is otherwise entitled under the Plan.

     7. Transferability. The Option is not transferable other than as designated by the Participant by will or by the laws of descent and distribution, and during the Participant’s life, may be exercised only by the Participant or the Participant’s legal guardian or legal representative. However, the Participant, with the approval of the Committee, may transfer the Option for no consideration to or for the benefit of the Participant’s Immediate Family (including, without limitation, to a trust for the benefit of the Participant’s Immediate Family or to a partnership or limited liability company for one or more members of the Participant’s Immediate Family), subject to such limits as the Committee may establish, and the transferee shall remain subject to all the terms and conditions applicable to the Option prior to such transfer. The foregoing right to transfer Option shall apply to the right to consent to amendments to this Agreement and, in the discretion of the Committee, shall also apply to the right to transfer ancillary rights associated with the Option. The term “Immediate Family” shall mean the Participant’s spouse, parents, children, stepchildren, adoptive relationships, sisters, brothers and grandchildren (and, for this purpose, shall also include the Participant).

     8. Non-Competition; Non-Solicitation.

          (a) Consideration for this Section. Participant acknowledges and agrees that:

               (i) the benefits afforded by this Agreement are discretionary and over and above the ordinary employment compensation provided by the Company to Participant, and in making its decision to offer Participant the benefits afforded by this Agreement the Company relied upon and was induced by the covenants made by Participant in this section,

               (ii) in accepting the grant evidenced by this Agreement Participant is receiving an asset of significant value, which is adequate consideration for the restrictions imposed by this Agreement,

               (iii) Participant’s position with the Company places Participant in a position of confidence and trust with the clients and employees of the Company,

               (iv) the Company’s business is carried on throughout the world and accordingly, it is reasonable that the restrictive covenants set forth below are not limited by specific geographic area,

               (v) the course of Participant’s employment with the Company necessarily requires the disclosure of confidential information and trade secrets related to the Company’s relationships with clients (such as, without limitation, pricing information, marketing plans, budgets, designs, methodologies, products, client preferences and policies, and identity

of appropriate personnel of clients with sufficient authority to influence a shift in suppliers) as well as other confidential and proprietary information, (such as databases, methodologies, and technologies),

               (vi) Participant’s employment affords Participant the opportunity to develop a personal acquaintanceship and relationship with the Company’s employees and clients, which in some cases may constitute the Company’s primary or only contact with such employees and clients, and to develop a knowledge of those client’s and employee’s affairs and requirements,

               (vii) the Company’s relationships with its established clientele and employees are placed in Participant’s hands in confidence and trust, and

               (viii) it is reasonable and necessary for the protection of the goodwill and business of the Company that Participant make the covenants contained in this Agreement.

          (b) Restricted Activity.

               (i) Participant agrees that during the term of Participant’s employment, Participant shall not, directly or indirectly, as a director, officer, employee, agent, partner or equity owner of any entity (except as owner of less than 4.9% of the shares of the publicly traded stock of a corporation which Participant does not have in fact the power to control or direct), or in any other manner directly or indirectly engage in any activity or business competitive in any manner with the activities or business of the Company.

               (ii) After Participant’s Date of Termination, for a period of six months if the Date of Termination is before the first annual anniversary of the Grant Date, and for a period of twelve months if the Date of Termination is on or after the first annual anniversary of the Grant Date, with respect to any services, products, or business pursuits competitive with those of the Company, Participant shall not, directly or indirectly, whether as a director, officer, employee, consultant, agent, partner, equity owner of any entity (except as owner of less than 4.9% of the shares of the publicly traded stock of a corporation which Participant does not have in fact the power to control or direct), participant, proprietor, manager, operator, independent contractor, representative, advisor, trustee, or otherwise, solicit or otherwise deal in any way with any of the clients or customers of the Company:

          (A) with whom Participant in the course of employment by the Company acquired a relationship or had dealings,

          (B) with respect to whom Participant in the course of employment by the Company was privy to material or proprietary information, or

          (C) with respect to whom Participant was otherwise involved in the course of employment by the Company, whether in a supervisory, managerial, consultative, policy-making, or other capacity involving other Company employees who had direct dealings with such clients and customers.

Such clients and customers include any client or customer to whom the Company sold services or products in the two years prior to the Date of Termination, any prospective client or customer of the Company for whom a proposal was prepared or to whom any other marketing presentation was made within the year prior to the Date of Termination, or any prospective client or customer for whom pursuit was actively planned by the Company within the year prior to the

Date of Termination and in respect of whom the Company has not determined to cease such pursuit.

               (iii) For a period of one year after the Date of Termination, Participant shall not (including without limitation on behalf of, for the benefit of, or in conjunction with or as part of, any other person or entity) directly or indirectly:

          (A) solicit, assist, discuss with or advise, influence, induce or otherwise encourage in any way, any employee of Company to terminate such employee’s relationship with Company for any reason, or assist any person or entity in doing so,

          (B) employ, assist, engage, or otherwise contract or create any relationship with, any employee or former employee of Company in any business or venture of any kind or nature, in the case of a former employee unless such person shall not have been employed by Company for a period of at least one year and no solicitation prohibited hereby shall have occurred prior to the end of such one year period, or

          (C) interfere in any manner with the relationship between any employee and Company.

          (c) Remedies. Participant acknowledges that the Company’s legal remedies for a breach of this Section 8 shall be inadequate, and that without limitation of Company’s rights to any other remedy at law or equity available to it, the Company (i) shall be entitled to obtain injunctive relief to enforce this provision, and (ii) shall be entitled to cancel any rights under this Agreement, and (iii) shall be entitled to recover from the Participant any Stock for which this option has been exercised, or if such Stock has been transferred or sold, an amount equal to the value thereof, and such Stock and the proceeds thereof shall be held in a constructive trust for the purposes of enforcement hereof. The Company’s rights to enforce this Agreement shall survive any vesting and/or forfeiture of rights hereunder. If any part of this Section 8 shall be deemed illegal or unenforceable, this section shall be deemed modified and then enforced to the greatest extent legally enforceable.

     9. Definitions. For purposes of this Agreement, the terms listed below shall be defined as follows:

          (a) “Cause” means (A) refusal or substantial failure to perform (other than due to physical or mental disability), or misconduct in the performance of, the ordinary and customary duties of Participant as reasonably required by the Company or the successor company, provided that such refusal, failure, or misconduct has continued after the Company or the surviving or acquiring entity or successor company (“successor company”) has given Participant five business days written notice of same, (B) overt and willful disobedience of orders or directives issued by the Company or successor company that are within the reasonable scope of Participant’s duties to the Company or successor company, (C) conviction of or commission of any felony by Participant, whether or not related to performance of duties under this Agreement, (D) commission of any other illegal act if committed in connection with the performance of duties for the Company or successor company if such act could reasonably tend to bring the Company or successor company into disrepute, or (E) material violation of the Company’s or successor company’s written rules, regulations or policies of general application provided that such violation has continued after the Company or successor company has given Participant five business days written notice of same.

          (b) Complying Assumption. A Complying Assumption pursuant to Section 3(c) shall occur if in connection with a Change in Control the surviving or acquiring entity or

successor company , or its respective parent company, assumes, continues, or substitutes for the Option as provided in Section 4.15 of the Plan.

          (c) Date of Termination. The Participant’s “Date of Termination” shall be the first day occurring on or after the Grant Date on which the Participant’s employment with the Company and all Related Companies terminates (irrespective of the reason for termination and whether such termination is voluntary or involuntary); provided that a termination of employment shall not be deemed to occur by reason of a transfer of the Participant between the Company and a Related Company or between two Related Companies; and further provided that the Participant’s employment shall not be considered terminated while the Participant is on a leave of absence from the Company or a Related Company approved by the Participant’s employer. If, as a result of a sale or other transaction, the Participant’s employer ceases to be a Related Company (and the Participant’s employer is or becomes an entity that is separate from the Company), the occurrence of such transaction shall be treated as the Participant’s Date of Termination caused by the Participant being discharged by the employer.

          (d) Disability. Except as otherwise provided by the Committee, the Participant shall be considered to have a “Disability” during the period in which the Participant is unable, by reason of a medically determinable physical or mental impairment, to engage in any substantial gainful activity, which condition, in the opinion of a physician selected by the Committee, is expected to have a duration of not less than 120 days.

          (e) “Good Reason” means (i) material breach of the Company’s or successor company’s obligations to Participant, provided that Participant shall have given reasonably specific written notice thereof to the Company and/or successor company, and the Company and/or successor company shall have failed to remedy the circumstances within ten business days thereafter, (ii) any decrease in Participant’s base salary as in effect immediately prior to any Change of Control, or any material decrease in Participant’s benefits if such modification is not of general applicability to other similarly situated employees, or (iii) the relocation of Participant’s principal office to a location more than thirty (30) miles from the location of his/her office immediately prior to the Change in Control; provided, however, that Participant’s principal office shall not be deemed to be relocated by virtue of Participant being required to spend up to ten working days per month on average in the Company’s or successor company’s, and their respective affiliate’s, other offices.

          (f) Plan Definitions. Except where the context clearly implies or indicates the contrary, a word, term, or phrase used in the Plan is similarly used in this Agreement.

     10. Heirs and Successors. This Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, and upon any person or entity acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets and business. In the event of the Participant’s death prior to exercise of this Award, the Award may be exercised by the estate of the Participant to the extent such exercise is otherwise permitted by this Agreement. Subject to the terms of the Plan, any benefits distributable to the Participant under this Agreement that are not paid at the time of the Participant’s death shall be paid at the time and in the form determined in accordance with the provisions of this Agreement and the Plan, to the beneficiary designated by the Participant in writing filed with the Committee in such form and at such time as the Committee shall require. If a deceased Participant fails to designate a beneficiary, or if the designated beneficiary of the deceased Participant dies before the Participant or before complete payment of the amounts distributable under this Agreement, the amounts to be paid under this Agreement shall be paid to the legal representative or representatives of the estate of the last to die of the Participant and the beneficiary. Neither the benefits or obligations under this Agreement may be

transferred or assigned by Participant except as otherwise expressly provided herein or in the Plan.

     11. Administration. The authority to manage and control the operation and administration of this Agreement shall be vested in the Committee, and the Committee shall have all powers with respect to this Agreement as it has with respect to the Plan. Any interpretation of the Agreement by the Committee and any decision made by it with respect to the Agreement is final and binding.

     12. Plan Definitions. Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the office of the Secretary of the Company.

     13. Amendment. This Agreement may be amended by written Agreement of the Participant and the Company, without the consent of any other person.

     THIS AGREEMENT SHALL NOT BE EFFECTIVE UNLESS A COPY SIGNED BY THE PARTICIPANT IS DELIVERED TO THE COMPANY WITHIN FORTY-FIVE (45) DAYS AFTER THE GRANT DATE.

     IN WITNESS WHEREOF, the Participant has executed this Agreement, and the Company has caused these presents to be executed in its name and on its behalf, all as of the Grant Date.

Participant
/s/ Enzo Micali
Name:	Enzo Micali
Dated: 6/8/09

Harris Interactive Inc.
By:	/s/ Marc H. Levin
Its:	SVP, General Counsel and Corporate
	Secretary

EX-10.4.7

Exhibit 10.4.7

June 2, 2009

Frank Forkin

Dear Frank:

We are delighted to present you with this offer to join Harris Interactive!

Our people, individually and collectively, are critical to our success, and one of our strategic business objectives focuses specifically on cultivating a strong, informed, engaged, and committed team. We believe you have skills for individual growth and advancement in a dynamic, fast-paced environment, and that you will contribute to, and be a vital part of, our success.

The specifics of our offer to you are as follows:

• Your position will be President, Client Services North America.

• Your start date will be June 22, 2009 (the “Start Date”).

• Your starting salary will be $275,000 per year, earned and payable on a bi-weekly, prior to any payroll deductions.

• Your performance and salary will be reviewed annually. You will be eligible to be considered for a salary increase in the Company’s regular annual review cycle. To the extent merit increases are granted, eligibility will be based on your individual performance and company performance.

• For fiscal year 2010, you are eligible for an annual bonus of 40% of your base salary. The Compensation Committee of the Board of Directors retains discretionary authority over all bonus awards. It also establishes metrics and objectives for bonus awards annually. Declared bonuses (including your guaranteed bonuses set forth above) are paid within 75 days after the end of each fiscal year only to persons who remain employed at the time of payment.

• Subject to approval by the Compensation Committee of the Board of Directors, you will have the option to purchase 100,000 shares of Harris Interactive common stock under the terms and conditions more fully described in the enclosed sample stock option agreement. The option price will be the fair market price of our stock on the grant date. The company’s regular quarterly grants are made at the close of trading on the later of (i) the 15^th day of the second month of the fiscal quarter and (ii) one week after the Company’s quarterly earnings release. If the day falls on a non business day, the fair market price will be the next business day.

• Should the Company terminate your employment for any reason other than for “cause”, you will receive severance payments equal to (A) six months of your then-current base salary if you are terminated prior to the first anniversary of the Start Date or (B) twelve months of your then-current base salary if you are terminated on or after the first anniversary of the Start Date, in either case, payable in periodic installments in accordance with the Company’s regular payroll practices for its executive personnel at the time of payment, subject to your execution of the Company’s customary confidentiality and non-compete agreements, and execution of a release in favor of the Company.

• You are eligible for 20 days of vacation, which accrue at 6.153 hours per pay period.

• Your principal business office shall be at the Company’s New York City office.

• You will receive a sign-on bonus of $10,000; provided, however, if you voluntarily terminate your employment prior to the first anniversary date of your employment (or you are terminated for “cause” within such period), you will be required to repay to the Company your sign-on bonus.

Harris Interactive offers a comprehensive benefits package. Details of all of our benefits offerings, including eligibility and effective dates, are included in the attached Employee Benefits Summary.

Additional information will be provided in your Welcome Kit, as well as at New Hire Orientation on your first day. With all of our benefits, we strive to provide offerings that are valuable to our employees at an affordable cost.

Please note that as part of our selection process, we conduct reference and background checks on all candidates, as well as review any potential limitations resulting from non-compete agreements you may have signed with previous employers. This employment offer is contingent upon successful completion of your reference and background checks, review of any non-compete agreements, and your ability to present appropriate documentation to prove your eligibility to work in the United States. Harris Interactive is an Equal Opportunity Employer.

Your employment at Harris Interactive is “at will”, which means that the employment relationship between you and the company may be terminated at any time, by either you or Harris Interactive, for any reason not expressly prohibited by law.

If you are in agreement with the terms of this offer, please sign one copy of this letter and return it to Wanda M. Callahan, Sr. Staffing & Recruitment Manager, Harris Interactive, Inc., 60 Corporate Woods, Rochester, NY 14623 within one week of receipt.

Once you have accepted this job offer, you will receive additional information via email regarding your first day, including plans for your New Hire Orientation at which time you will receive your Welcome Kit.

Frank, we are very pleased to make this offer to you. Please contact me if you have any questions about Harris Interactive or the specifics of this employment offer. We look forward to you joining the Harris Interactive team.

Sincerely,

/s/ Kimberly Till

Kimberly Till
President and Chief Executive Officer
Harris Interactive, Inc.

I accept this offer of employment as outlined above.

/s/ Frank Forkin   Frank Forkin June 2, 2009        Date

EX-10.4.8

Exhibit 10.4.8

May 11, 2009

Patti Hoffman

Dear Ms. Hoffman:

     This letter agreement confirms your temporary employment with Harris Interactive Inc. (“Harris”). This is not a permanent employment contract and under no circumstances may it be construed as such. The following are the terms of your temporary employment:

     TITLE. Your position will be Interim Head of Human Resources, reporting to Kimberly Till, President and Chief Executive Officer of Harris Interactive. This appointment does not include any assurance, obligation, or guarantee of subsequent permanent employment.

     DUTIES AND RESPONSIBILITIES. As Interim Head of Human Resources, you shall be responsible for managing all of the HR functions of Harris globally, including, without limitation, assisting in the development of a comprehensive compensation and benefits program for Harris that addresses both commissioned and non-commissioned positions, training and recruitment. You agree that the foregoing list of duties and responsibilities are not exhaustive and may be changed, modified, or increased at the discretion of Harris. You will be responsible for performing all assigned duties faithfully, to the best of your abilities and at a level commensurate with your title. You shall, at all times abide by the safety rules, regulations and working conditions of Harris and maintain the highest standard of professionalism and workmanship in accordance with Harris’ policies. You are expected to work a minimum of forty (40) hours per week. You will be required to prepare a weekly time sheet and you will be remunerated only for time worked.

     OFFICE. Your office will be located in Harris’ Princeton, New Jersey office.

     SALARY. In consideration of the services rendered by you as Interim Head of Human Resources, you will be paid $19,000 per month, prior to any payroll deductions and appropriate taxes, earned and payable in accordance with Harris’ normal payroll practices or as otherwise agreed in writing by you and Harris.

     REIMBURSEABLE EXPENSES. You will be reimbursed only for documented expenses, pre-approved by Ms. Till, in accordance with Harris’ expense reimbursement policy.

     NO BENEFITS. As a temporary employee, you are not entitled to (among other benefits due full-time, permanent employees) employer paid health insurance, overtime pay, accident insurance, disability insurance, retirement, or vacation and sick leave.

     TERM. Unless terminated sooner in accordance with this letter agreement, the initial term of your temporary employment shall be two (2) months, beginning on May 11, 2009 and ending on July 10, 2009 (the “Initial Term”). Your temporary employment may be renewed for subsequent one (1) month terms (each, a “Renewal Term”) upon written agreement of you and Harris at least ten (10) days prior to the end of the Initial Term or any Renewal Term, as applicable.

     TERMINATION. Harris reserves the right to terminate your temporary employment before the end of the Initial Term or any Renewal Term for (i) failure to complete appropriate documentation, (ii) misconduct, (iii) unsatisfactory performance, (iv) financial exigency, (v) medical reasons that prevent you from fulfilling your responsibilities, or (vi) failure to comply with all policies and procedures of Harris. Such termination may occur at any time upon written notice delivered to you. Further, you and Harris each have the right to terminate your temporary employment before the end of the Initial Term or any Renewal Term for any reason with ten (10) days prior written notice.

     GENERAL PROVISIONS. This letter agreement shall be governed and interpreted under the laws of the State of New York without reference to principles of conflicts of laws. With respect to all matters related to this letter agreement, the parties consent to exclusive jurisdiction in the courts of the State of New York. The parties hereby waive any claim that such courts are an improper or inconvenient forum. This letter agreement and any written modifications of it constitute the sole agreement of you and Harris; any previous written contracts, oral agreements or understandings in conflict with this letter agreement shall be void; provided, however, you will be required to sign additional agreements associated with your temporary employment (e.g., a confidentiality agreement), which shall constitute separate and distinct agreements between you and Harris. Any and all modifications of this letter agreement shall be in writing hereon or attached hereto and signed by both you and Harris. If any provision herein is, becomes, or is held invalid, illegal, or unenforceable, such

1

provision shall be deemed modified only to the extent necessary to conform with applicable laws so as to be valid and enforceable. If it cannot be so amended without materially altering the intent of the parties, it shall be stricken and the remainder of this letter agreement shall remain in full force and effect and be enforced and construed as if such provision had not been included.

     If you are in agreement with the foregoing, please sign and return one copy of this letter agreement, which thereupon will constitute our understanding with respect to its subject matter.

Very truly yours,
Harris Interactive Inc.
By:	/s/ Marc H. Levin Name: Marc Levin
	Title: SVP, General Counsel and Secretary

Accepted and agreed to:

/s/ Patti Hoffman Patti Hoffman

2

EX-10.4.15

Exhibit 10.4.15

CONTRACT OF EMPLOYMENT

This Contract of Employment (the “Contract”) is issued in accordance with the Employment Rights Act 1996 as amended.

This Contract is dated the 7 May between the following parties:

PARTIES

Employer:	Harris Interactive UK Ltd (the “Company”)
Registered Office Address:	Waterman’s Park, High Street, Brentford, TW8 0BB

Employee Name:	Robert Salvoni (the “Employee”)
Address:	48 Strawberry Hill Road Twickenham TW1 4PY
Position:	Managing Director, Europe

1.	COMMENCEMENT OF EMPLOYMENT
1.1	The Employee’s employment with the Company as stated above begins on 15 May 2009 (the “Commencement Date”) and will continue unless and until terminated in accordance with the terms of this Agreement.
1.2	The Employee’s period of continuous employment with the Company began on 15 May 2009 and any previous employer does not count as part of the Employee’s period of continuous service with the Company.
1.3	This Agreement, the Letter of Offer dated 5th may 2009 (and all documents annexed thereto) contains the entire terms of employment agreed between the Employee and the Company and supersedes and replaces all prior negotiations agreements arrangements or understandings between the Employee and the Company or any Associated Company relating to your employment or services with the Company and any Associated Company whether written or oral express or implied all of which will be deemed to have been cancelled by mutual agreement. [No variation or addition to this Agreement and no waiver of any provision will be valid unless in writing signed by or on behalf of both parties.]
1.4	The Company’s Employee Handbook as amended from time to time is provided by way of guidance to the Employee during employment with the Company, and although it does not form part of his/her terms and conditions of employment, he/she will be expected to adhere to the policies, procedures and guidelines contained therein. The current edition of the Handbook is available from the Human Resources department.
2.	JOB DUTIES AND RESPONSIBILITIES
2.1	The Company employs the Employee in the capacity of Managing Director, Europe. Neither the Employee’s job title or his/her duties limits or defines what he/she may be required to do and the Company has the right at any time during his/her employment to require him/her to undertake any duties commensurate with those of the Managing Director, Europe, and falling within his/her role and responsibilities and capabilities even if they are undertaken by others from time to time or to require him/her to undertake another role within his/her capabilities as the Company’s business needs may from time to time determine.
2.2	The Employee shall devote all his/her time, attention and skill to his/her duties of employment.
2.3	The Employee’s work will initially be directed by Kimberly Till, CEO, or such person as the Company may designate from time to time.
2.4	The Employee is required to act in the best interests of the Company at all times and in accordance with all the Company’s rules, regulations and policies from time to time in force.
2.5	The Company may reasonably require the Employee (as part of the Employee’s duties of employment) to perform duties or services not only for the Company but also for any Associated Company where such duties or

	services are consistent with the Employee’s duties to the Company. The Company may in agreement with the Employee, assign his/her employment to any Associated Company on the same terms and conditions as set out, or referred to in this Contract.
3.	PLACE OF WORK
3.1	The Employee’s place of work will be at our London office based at Watermans Park, High Street, Brentford, TW8 0BB or at any premises from which the Company may operate from time to time.
3.2	The Company may require the Employee to travel for the performance of his/her duties. The Company will not require the Employee to work outside the United Kingdom for a period of one month or more.
4.	PROBATIONARY PERIOD
	The first 12 (twelve) weeks after the Commencement Date will be considered a probationary period during which either party may terminate the relationship with one month’s written notice and on reasonable grounds. The Company reserves the right to make a payment in lieu of notice.
	The provisions contained in this Agreement relating to Company Sick Pay, disciplinary and grievance procedures and benefits (set out in clause 9) do not apply to your employment during your probationary period.
	The Company further reserves the right to extend your probationary period should this be considered necessary by the company.
5	SALARY
5.1	The Employee shall receive an annual salary of £160,000 which will be payable in twelve (12) monthly installments on the last working day of each calendar month, in arrears, less all applicable taxes and NI contributions by bank transfer to a bank account of the Employee’s choice which the Employee is required to notify to the Human Resources department on joining the Company. Future increases to salary, if any, (which shall be entirely at the Company’s discretion) will be notified to the Employee separately and will be set out on the Employee’s itemised pay statement.
5.2	Pay for the full calendar month is credited to the Employee’s account normally on the last working day of each calendar month. Should the Employee commence or terminate the Employee’s employment other than on a date at the start or end of the calendar month, the Employee will receive salary proportional to the time worked in that calendar month.
5.3	The Employee’s remuneration package must be treated as confidential and must only be discussed internally with appropriate Managers.
6.	HOURS OF WORK
6.1	The Employee’s basic hours of work are 37.5 hours per week. Normal working hours are 9:00 am to 5:30pm Monday to Friday, with one hour for lunch. However, the Company reserves the right to change the Employee’s start and finish times and the days upon which the Employee works with reasonable notice.
6.2	The Employee will also be required to work such additional hours as and when requested to do so by the Company or when the proper performance of the Employee’s work so requires. He/she will not be entitled to be paid extra remuneration for any such additional hours worked in excess of his/her basic weekly hours.
6.3	All hours worked are subject to the provisions of the Working Time Regulations 1998 unless the Employee signs an opt-out agreement under the terms of these Regulations.
7.	PERFORMANCE AND SALARY REVIEW
7.1	An Employee’s salary will be reviewed once a year (generally in October) and may or may not be increased in the Company’s absolute discretion.
7.2	The Company reserves the right to change the time of the annual salary review.
8.	EXPENSES AND DEDUCTIONS
8.1	The Company will pay for, or the Employee will be reimbursed for all reasonable out-of pocket expenses properly incurred in the performance of the Employee’s duties, including reasonable travel, entertainment expenses, which are approved by the Company and subject to the production of supporting vouchers or receipts and subject to compliance with the expenses provisions set out in the Company’s Expense Reimbursement Policy, as amended from time to time.

8.2	The Company will be entitled at any time during the Employee’s employment and in any event on termination to deduct from his/her remuneration under this Agreement or from any other sums owed or owing by the Company to him/her any monies due from him/her to the Company including but not limited to any outstanding loans, overpayments, advances, the cost of repairing any damage or loss to the Group’s property caused by him/her or any holiday he/she has taken in excess of his/her pro-rated leave entitlement accrued to the relevant date.
9.	BENEFITS
9.1	The Employee, if eligible, will be able to participate in the Company’s medical, other health, welfare and employee benefit programmes including pension schemes (together “Schemes”) from time to time in force.
9.2	The provision of benefits by the Company is subject to acceptance and continuation of cover for the Employee by a scheme provider/insurer as the Company may from time to time determine at rates acceptable to the Company and to any conditions, exclusions or limitations which such insurer may propose and without prejudice to the Company’s right to amend vary, substitute or terminate such benefits at any time. If a scheme provider/insurer refuses for any reason to provide the relevant benefits to the Employee under the applicable scheme, the Company shall not be liable to provide (or compensate for the loss of) such benefits.
9.3	These benefits provided by the Company may be subject to Inland Revenue rules and PAYE requirements and deductions.
9.4	Full details of the schemes, as amended from time to time, referred to above will be provided to the Employee on joining the Company or on request from the Human Resources Department.
9.5	Additional benefits associated with the Employee’s employment, if any, will be set out in the Employee’s Offer Letter.
10.	HOLIDAY ENTITLEMENT
10.1	In addition to the Public holidays normally applicable in England, the Employee is also entitled to 25 working days’ paid holiday in each complete calendar year providing that you work five days a week. This basic entitlement includes three days’ paid holidays on dates to be determined by the Company, although typically these will be for the period between Boxing Day and New Year’s Day.
10.2	This entitlement increases to 28 days per calendar year after three full year’s service, and is pro-rated for the period from the completion of the three years full service to the end of that holiday/calendar year.
10.3	Employees are also allowed to ‘buy and sell’ holidays up to a maximum of 5 days leave per annum. You will be advised of the programme each December for the following holiday year, when you will be expected to make your decision about opting to buy or sell holiday for the following year. This buying and selling will only be allowed at this time in December.
10.4	Employees who work part-time will have their holiday entitlement pro-rated according to the hours that they work.
10.5	The Company’s holiday year is from 1st January to 31st December.
10.6	All holidays paid and unpaid must be previously agreed in writing with the Employee’s Manager, giving reasonable notice in writing and will be subject to the business needs of the Company. Not more than two weeks may be taken at any one time, save at the Company’s discretion.
10.7	At the start and termination of the Employee’s employment with the Company, the Employee’s holiday entitlement will be calculated on a pro-rata basis for each complete month the Employee has worked for the Company during the relevant holiday year based on one-twelfth of the annual entitlement. Your entitlement to holiday pay will accrue ratably throughout the year.
10.8	If, on the termination of the Employee’s employment the Employee has exceeded their accrued holiday entitlement, this excess will be deducted from the Employee’s final salary or any other sums due to the Employee. If the Employee has holiday entitlement still owing, the Company may pay the Employee a sum in lieu of accrued holiday (less all applicable taxes and NI). For the avoidance of doubt, one day’s holiday will be calculated on the basis of 1/260th of your salary.
10.9	Holiday entitlement for one year should be taken in the same holiday year. Failure to do so will result in forfeiture of any such accrued holiday not taken. However if this has not been possible because of mutually agreed business requirements, subject to their Manager’s discretion, 5 days holiday entitlement can be carried over into January or February of the next year. Any unused holiday entitlement after this period will be lost. No payment in lieu of any untaken holiday will be made.

11.	ABSENCE, SICKNESS AND SICK PAY
11.1	On the first working day of absence (other than pre-approved absence such as holiday), the Employee must notify their Manager (or, in his/her absence, another Manager) before 10 a.m. If the Employee is unable to telephone the Manager, the Employee must arrange for his/her absence to be notified on his/her behalf.
11.2	The Employee must continue to keep the Company informed on a daily basis for the first 5 working days of absence.
11.3	A Self Certification Form must be submitted to cover the whole of the absence period, even if it is just one day, in addition to a Medical Certificate where appropriate. Entitlement to payment is subject to notification of absence and production of medical certificates as required above.
11.4	If the Employee’s absence from work lasts for more than 7 consecutive days (including Saturday and Sunday), the Employee must submit a medical certificate (signed by a Doctor) to the Company. Medical certificates should be submitted to the Company to cover the full period of the Employee absence from the 7th consecutive day of illness. When a medical certificate expires, the Employee should notify the Company on the first morning following expiry if he/she does not intend to return to work.
11.5	Subject to the Employee’s compliance with the notification procedures set out in this clause 11, the Company shall pay base salary in the event of absence due to sickness in accordance with the Employee’s length of service as set out below and always provided the total absence comprises no more than 6 separate periods of absence within any 12 month period (“Company Sick Pay”).

Length of Service	Period of Entitlement during any 12 month period
Up to 6 months	5 days full pay
6-12 months	2 weeks full pay 2 weeks half pay
1-2 years	6 weeks full pay 6 weeks half pay
3 years and over	13 weeks full pay 13 weeks half pay

11.6	Company Sick Pay is inclusive of any Statutory Sick Pay (“SSP”) to which the Employee may be entitled, in respect of such absence and is subject to tax and National Insurance deductions. After an Employee’s entitlement to Company Sick pay has expired, sick pay will be made in accordance with the SSP arrangements, if the Employee is eligible. Failure to comply with the Company’s sickness procedures, failure to satisfactorily explain absence, or giving misleading or false statements may lead to disciplinary action including in serious cases, dismissal.
11.7	The Company reserves the right to require you at its expense to submit to such medical examination by a medical adviser nominated by the Company as the Company may from time to time require in the event of prolonged, recurrent or frequent absence due to sickness or at any time upon written request. You hereby give authority in accordance with the provisions of the Access to Medical Reports Act 1988 for the medical advisor to disclose the report of any such examination to the Company.
11.8	Entitlement to the Company Sick Pay and SSP are subject to the Company’s right to terminate the Employee’s employment, and the Company shall not be liable to provide, or compensate for the loss of, such benefit (s).
11.9	Depending on the circumstances, the Company reserves the right to terminate the Employee’s employment with the Company at the end of the Company Sick Pay Period giving appropriate notice in line with Section 14 below.

12.	COMPANY PROPERTY
12.1	The Employee may not remove any money, equipment, or other items of value belonging to the Company from its premises except lawfully for the purposes of Company business or when specific written permission is obtained from the Employee’s Manager. This is so, even though it may be the Employee’s intention to return the property in due course.
12.2	On the termination of the Employee’s employment with the Company, the Employee shall immediately return to the Company, in accordance with its instructions, all equipment, correspondence, records, specifications, notes, reports and other documents and any copies thereof and any other property belonging to the Company or any Associated Company (including, but not limited to, keys, laptops, mobile phones, equipment and security passes) which are in the Employee’s possession or under the Employee’s control. In respect of any such items or information held on any computer or other equipment belonging to the Employee, the Employee undertakes to delete any such items or information immediately on the termination of your employment. The Employee shall, if so required by the Company, confirm in writing his/her compliance with his/her obligations under this clause.
12.3	The use of the Management Information Systems (“MIS” which in this case includes email and the intranet usage) is restricted to approved business purposes. Any other use is forbidden.
12.4	By signing this Contract, the Employee acknowledge that all records, reports, correspondence, by e-mail, software and other data and information generated by or residing upon the MIS are property of the Company and may be used by it for any purposes permitted by law. The Employee also agrees by signing this Contract, that the Company can access all such data and information.
13.	HEALTH AND SAFETY
13.1	It is a condition of employment that the Employee agrees to comply with all medical, health and safety regulations applicable at any time.
13.2	The Employer will take all reasonably practicable steps to ensure the Employee’s health and safety and welfare while at work. It is the Employee’s legal duty to take care of their own health and safety and that of their colleagues. The Employee is referred to the Company’s Health & Safety Policy in the Employee Handbook (and in particular, the Employee must report any incidents which have or may have led to injury or damage and comply with any self-assessment procedures relating to health and safety which the Company or any Associated Company may establish from time to time). The Employee acknowledges his/her responsibilities under the UK Health & Safety at Work Act (1974) in reducing the risk of accidents in the workplace.
13.3	In the interests of health of all employees, the Company operates a no smoking policy. It is a disciplinary offence to smoke at any time on Company premises.
14.	TERMINATION OF EMPLOYMENT
14.1	Upon successful completion of the probationary period and subject to Clause 14.2 below, the length of notice is a minimum of 6 months by either party.
14.2	The Company reserves the right to terminate the Employee’s contract without notice, or without pay in lieu of notice, if the Employee has committed an act of gross misconduct, gross negligence or in material breach of any of the terms of his/her employment.
14.3	The Employee agrees that the Company may at its absolute discretion make a payment or payments (which may, at the Company’s absolute discretion, be paid in installments) representing salary in lieu of any notice of termination of employment which the Employee or the Company is required to give, subject to any reduction under Clause 14.4 below. For the avoidance of doubt, such payment or payments shall be paid less deductions for tax and NI contributions and less all bonus/incentive, commission, or holiday entitlement which would have accrued to the Employee had the Employee been employed until the expiry of his/her notice entitlement under Clause 14.1 above. Further, the Employee shall have no entitlement to such payment, or payments unless and until the Company notifies the Employee in writing of its decision to make such payment(s) to the Employee.
14.4	Where the Company decides to exercise its power under Clause 14.3 to make any such payment(s) to the Employee, then the Employee undertakes to take all reasonable and necessary steps to find alternative employment to commence within a period equivalent to the notice period (or where notice has been served, the unexpired period of notice) referred to in Clause 14.1 commencing on the Termination Date.
14.5	The Company reserves the right to require the Employee not to attend at work and/or not to undertake all or any of the Employee’s duties of employment during any period of notice (whether given by the Employee or the Company), provided always that the Company shall continue to pay the Employee’s salary and contractual benefits whilst the Employee remains employed by the Company. The Employee will comply with any conditions

	laid down by the Company including but not limited to the prohibition of any contact and/or dealings between the Employee and the clients and/or suppliers and/or employees of the Company or any Associated Company.
14.6	On termination of the Employee’s employment, the Employee must immediately return to the Company all property in accordance with Clause 12.2 above.
14.7	The Company shall have the right to suspend the Employee on full pay and benefits pending any investigation into potential dishonesty, gross misconduct or other circumstances which (if proved) would entitle the Company to dismiss the Employee summarily.
14.8	The Company’s normal retirement age is 65.
15.	DATA PROTECTION
15.1	From time to time the Company will ask the Employee to provide personal information for Employee administration purposes. In particular, the information will enable the Company to administer Employee benefits, the payroll system, holiday and sickness records, performance appraisals, promotion assessments, salary reviews, email systems, and to comply generally with legal obligations. The information held may include sensitive data relating to the Employee’s health and data held for equal opportunities monitoring purposes.
15.2	The Company does, however appreciate that the Employee may consider some information to be particularly sensitive, and will let the Employee know when replies are not obligatory.
15.3	The Company will from time to time need to make some of the Employee’s information available to legal and regulatory authorities such as the local tax offices, to our accountants, auditors, lawyers, and other outside professional advisers, and to other parties which provide products and services to the Company such as IT systems suppliers, pensions, benefits and payroll administrators as well as other departments within the Company or any Associated Company.
15.4	By law the Employee has certain rights of access and rectification of the personal information the Company holds on the Employee. Please refer to the Human Resources Department for details.
15.5	Periodically the Company will ask the Employee to review and update the personal information that the Company holds.
15.6	By signing this Contract, the Employee gives consent to the Company processing, disclosure and transfer this data on the basis set out above. Further details may be obtained from the Human Resources Department. The Employee is encouraged to contact the Human Resources Department to check the accuracy of his/her personal data and to notify any changes.
16.	POSITIVE WORK ENVIRONMENT
	In order that the Employer may maintain a positive work environment for all employees, you must not engage in or permit any fellow employee to engage in any sexual, racial, or other harassment of or unlawful discrimination against any person (whether or not an employee of the Employer) in the course of your employment with the Company.
17.	MRS (MARKET RESEARCH SOCIETY) CODE OF CONDUCT
	In order for the employer to fulfill its obligations as a professional partner to the Market Research Society MRS, the employee must not engage in or permit any fellow employee to engage in any activities which are in breach of the MRS Code of Conduct.
	The Code of Conduct is designed to support all those engaged in market, social or opinion research in maintaining professional standards. The Code is also intended to reassure the general public and other interested parties that research is carried out in a professional and ethical manner. Copies of the code are available on the Intranet, or on the MRS website at http://www.mrs.org.uk/standards/codeconduct.htm
18.	CONFIDENTIALITY
18.1	The Employee will have access to, and be involved with information and material of a highly confidential nature, which must be carefully protected.
18.2	The Employee shall neither during his/her employment (except in the proper performance of the Employee’s duties) nor at any time for a 12 month period after its termination directly or indirectly

• use for the Employee’s own purposes or those of any other person, company, business entity or other organisation whatsoever; or

• disclose to any person, company, business entity or other organisation whatsoever;

any:

• trade secrets, or

• confidential information amounting to a trade secret

	relating or belonging to the Company or any of its Associated Companies including but not limited to any such information relating to research developments, processes, procedures, intellectual property, market research, marketing techniques and plans, business plans and strategies, customer names and other information related to customers, price lists, pricing policies and financial information or other business and/or technical information and materials, personnel information, including organisational charts, organisational changes and employee listings in oral, demonstrative, written, electronic, graphic or machine-readable form and any analyses, compilations, studies or documents prepared by the receiving party, any document marked “Confidential” (or with a similar expression), or any information which the Employee have been told is confidential or which the Employee might reasonably expect the Company would regard as confidential, or any information which has been given to the Company or any Associated Company in confidence by customers, suppliers and other persons.
18.3	The obligations contained in Clause 18.2 shall not apply to any disclosures required by law, and shall cease to apply to any information or knowledge which may subsequently come into the public domain after the termination of the Employee’s employment, other than by way of unauthorised disclosure.
18.4	The Employee must not, whether during or after employment, make or communicate (or cause or facilitate the making or communication of) any oral or written statement to any representative of the press, television, radio or other media on any matter connected with or relating to the Company or any of its Associated Companies, without the prior written consent of the Company.
19.	INTELLECTUAL PROPERTY/INVENTIONS
	All records, documents, papers (including copies and summaries thereof) and other copyright protected works made or acquired by the Employee in the course of his/her employment shall, together with all the worldwide copyright and design rights in all such works, be and at all times remain the absolute property of the Company.
20.	COMPUTER SOFTWARE
	As an employee of the Company you are under an obligation to comply with licence agreements entered into by the Company. This means that you must not copy computer software or any related documentation that includes user guides and user and user manuals.
	If you learn of any unauthorised copying of computer software or related documentation you must notify a Director of the Company immediately.
21.	RESTRICTIONS AFTER EMPLOYMENT
21.1	The Employee shall not for a period of 6 months after the termination of their employment either on the Employee’s own account or for any person, firm or company directly or indirectly offer employment to or procure employment for any person known to the Employee, who was a director or senior employee (whose work involved knowledge or use of confidential information) of the Company or was providing consultancy services to the Company at any time during the 6 months immediately prior to termination of the Employee’s employment and with whom the Employee has dealt with in the 12 months immediately prior to termination of the Employee’s employment;
21.2	The Employee shall not for a period of 6 months after the termination of their employment either on the Employee’s own account or for any person, firm or company which shall be in direct competition with the Company or with any Associated Company, directly or indirectly: -

(a)	seek to solicit business from any customer, or
(b)	Have business dealings with any customer

with whom the Employee has dealt, or with whom employees reporting to or under the direct control of the Employee had personal contact on behalf of the Company or any Associated Company, with in the 12 months immediately prior to termination of the Employee’s employment.

21.3	The Employee shall seek not to interfere with any person, firm or company who has at any time during the 12 months immediately preceding the termination of the Employee’s employment, been a supplier of services or goods to the Company from providing services or goods to the Company or prevent any such person, firm or company.
22.	EXCLUSIVITY OF SERVICE / CONFLICT OF INTEREST
22.1	The Employee is required to devote his/her full time, attention and abilities to his/her job duties during working hours, and to act in the best interests of the Company and its Associated Companies at all times.
22.2	The Employee must not, without the prior written consent of the Company, in any way directly or indirectly (i) be engaged or employed in, or (ii) concerned with (in any capacity whatsoever) or (iii) provide services to, any other business or organisation.
22.3	Subject to any written regulations issued by the Company which may be applicable, neither the Employee nor his/her Immediate Relatives, nor any company or business entity in which he/she or they have an interest, are entitled to receive or obtain directly or indirectly any payment, discount, rebate, commission or other benefit from third parties in respect of any business transacted (whether or not by the Employee) by or on behalf of the Company or any Associated Company and if the Employee, his/her Immediate Relatives or any company or business entity in which he/she or they have an interest, directly or indirectly obtain any such payment, discount, rebate, commission or other benefit the Employee will forthwith account to the Company or the relevant Associated Company for the amount received or the value of the benefit so obtained.
22.4	The Employee confirms that he/she has disclosed fully to the Company all circumstances in respect of which there is, or there might be, a conflict of interest between the Company or any Associated Company and the Employee, or his/her Immediate Relatives, and the Employee undertakes to disclose fully and immediately to the Company any such circumstances which may arise during his/her employment or in respect of which he becomes aware in respect of other employees.
22.5	The Employee hereby warrants that he/she is free to take up the employment and that there are no restrictions or terms in any agreement whether verbal or otherwise which could prevent or hinder the performance of his/her duties to the Company or any Associated Company or give rise to any claim against or liability on the part of the Company or any Associated Company. If at any time it becomes apparent that there may be such restrictions or if any such claims are made or threatened, then the Company reserves the right to terminate this Agreement forthwith without notice or to make such changes to the terms of this Agreement or your duties as it considers necessary in the circumstances.
23.	DISCIPLINARY AND GRIEVANCE PROCEDURE
	The current edition of the Company’s Disciplinary and Grievance Procedures (which may be amended from time to time) is available from the Human Resources department and applies during your employment but does not form part of your contract of employment.
24.	MISCELLANEOUS
24.1	The Company shall have the right, on giving written notice of the changes envisaged at the earliest opportunity (and in any event not later than one month after a change), to change, delete or add to any of these terms and conditions of employment and any such change or alteration will take effect from the end of that notice period or such other later date as may be notified by the Company. Such notice may be posted on company notice boards or notified to you direct. Every effort will be made to consult with Employees where the change is of a substantial nature.
24.2	This Agreement will be governed by and interpreted in accordance with English law and the parties hereby submit to the exclusive jurisdiction of the Courts of England and Wales except that this Agreement may be enforced in any court of competent authority.
24.3	To be effective all notices and requests relating to this Agreement must be in writing but may be delivered personally or by first class recorded delivery post fax to the Company at its registered office for the time being or to the Employee at his address as stated in this Agreement or as notified from time to time.
24.4	A notice or request will be deemed to have been served if personally delivered at the time of delivery if posted at the expiration of 48 hours after the envelope containing the same was delivered into the custody of the postal authorities, and if sent by fax at the expiration of 12 hours after the same was dispatched.

24.5	In proving service it will be sufficient to prove that personal delivery was made or that the envelope containing such notice was properly addressed as a pre-paid first class recorded delivery letter or that the fax was properly addressed and dispatched.
24.6	There are no collective agreements in place that relate to this employment.
25.	DEFINITIONS
25.1	An “Associated Company” means any company twenty per cent or more of the equity share capital of which is owned directly or indirectly by the Company (applying the provisions of section 838 of the Income and Corporation Taxes Act 1988 in the determination of ownership) or any subsidiary or holding company of the Company and a company to which the Company or any such subsidiary or holding company renders managerial administrative or technical services
25.2	“Company” shall include the successors in title and assigns of the Company.
25.3	“Immediate Relatives” shall include husband, wife, common law spouse, children, brothers, sisters, cousins, aunts, uncles, parents, grandparents, and the aforesaid relatives by marriage.
25.4	“Termination Date” means the date when the Employee’s employment terminates.

Signed in duplicate

THE COMPANY
Signed on behalf of The Company:

By:	/s/ Craig Fines-Allin
Craig Fines-Allin
HR Director

Date 5/7/09

THE EMPLOYEE

I understand and agree to the terms and conditions of my Contract of Employment as set out above.

/s/ Robert Salvoni Robert Salvoni

Employee’s signature

Date 5/15/09

EX-10.4.28

Exhibit 10.4.28

SALARY AND BONUS ARRANGEMENTS WITH EXECUTIVE OFFICERS AND TERMS OF FISCAL
2010 BONUS PLANS

On August 19, 2009, the Compensation Committee of the Board approved the base salaries and target bonus amounts under the Company’s fiscal 2010 Corporate Bonus Plan (the “Bonus Plan”) for the Company’s executive officers (the “Executive Officers”). The Bonus Plan is designed to establish a pool of funds (the “Bonus Pool”) to be available for making bonus payments to the Executive Officers as well as certain other employees of the Company if the Company, on a consolidated basis, achieves budgeted fiscal 2010 operating income (the “Financial Target”), as approved by the Board in connection with establishing the Company’s fiscal 2010 annual budget. The percentage achievement of the Financial Target (the “Funding Percentage”) determines the extent to which the Bonus Plan is funded, as follows: the Bonus Plan will be fully funded if the Company achieves 100% of the Financial Target or will be funded at reduced levels if the Company achieves 95%, 90%, 85% or 80% of the Financial Target. The Bonus Plan will not be funded if the Company achieves less than 80% of the Financial Target. The Board, in its discretion, may increase the size of the bonus pool if the Company achieves greater than 100% of the Financial Target. Each Executive Officer (other than Patti Hoffman, Interim Head of Human Resources) is entitled to a bonus amount equal to 70% of his or her target bonus amount multiplied by the Funding Percentage, plus an additional bonus amount equal to thirty percent 30% of his or her target bonus amount multiplied by the Funding Percentage based upon his or her level of achievement of individual qualitative strategic goals and other metrics, as determined by the Board, in its discretion, in the case of the Company’s Chief Executive Officer, and as determined by the Executive’s manager, in his or her discretion, in the case of the other Executive Officers.

The base salary and target bonus amounts (in U.S. dollars except as noted) for the Executive Officers are as follows:

Executive Officer	Base Salary		Target Bonus Amount
Kimberly Till (President and CEO)	$	600,000	$	600,000
Robert Cox (EVP, CFO and Treasurer)	$	305,000	$	152,500
George Terhanian (President, Global Solutions)	$	300,000	$	100,000
Enzo Micali (Global EVP, Operations and Technology)	$	295,000	$	118,000
Frank Forkin (President, North America Client Services)	$	275,000	$	110,000
Robert Salvoni (Managing Director, Europe)	160,000 (GBP)		64,000 (GBP)
Patti Hoffman (Interim Head of Human Resources)	$	228,000	N/A
Eric Narowski (Principal Accounting Officer and SVP, Global Controller)	$	174,300	$	34,000

EX-10.4.36

Exhibit 10.4.36

CHANGES TO COMPENSATION ARRANGEMENTS FOR NON-EMPLOYEE DIRECTORS OF
HARRIS INTERACTIVE INC EFFECTIVE AS OF NOVEMBER 15, 2009

     On April 28, 2009, the Compensation Committee of the Board of Directors (the “Board”) of Harris Interactive Inc. (the “Company”) approved certain reductions and modifications to non-employee director compensation. These changes will become effective for the annual period commencing after the Company’s annual meeting to be held in October 2009, in order to better align the compensation of the non-employee directors with the cost control initiatives undertaken by the Company in response to the challenging global macroeconomic environment.

     The annual cash retainer payable to each non-employee director will be reduced from $41,500 to $35,000 and the supplemental annual cash compensation payable to the non-employee directors holding the following positions will be reduced as follows:

• Chairman of the Board — $5,000, reduced from $15,000 received in the prior year,

• Lead Director — $5,000, reduced from $15,000 received in the prior year,

• Chairman of the Audit Committee — $3,000, reduced from $7,500 received in the prior year, and

• Chairman of the Compensation Committee — $3,000, reduced from $5,000 received in the prior year.

     The number of shares of restricted stock that each non-employee director is to receive on November 15, 2009 will be calculated by dividing the annual cash retainer of $35,000 by the higher of $2.00 and the closing price for the Company’s stock price on November 13, 2009 (since November 15 falls on a weekend). Supplemental grants of 3,500 shares of restricted stock, reduced from 5,000 shares granted for the prior year, will be made on November 15, 2009 to the Chairman of the Board, the Lead Director, the Chairman of the Audit Committee and the Chairman of the Compensation Committee.

     Vesting terms for the restricted stock grants discussed above will remain unchanged from those disclosed in our Proxy Statement, filed with the Securities and Exchange Commission (“SEC”) on Form DEF14A on September 13, 2008.

     The form of agreement of restricted stock for non-employee directors can be found in Exhibit 10.1.13 to our Annual Report on Form 10-K for the fiscal year ended June 30, 2009.

EX-10.6.18

Exhibit 10.6.18

TENTH AMENDMENT TO LEASE

1. PARTIES

1.1 THIS AGREEMENT made the 8^th day of May, 2009 is by and between 5 INDEPENDENCE SPE LLC (hereinafter “Landlord”) whose address is c/o Mack-Cali Realty Corporation, 343 Thornall Street, P.O. Box 7817, Edison, New Jersey 08818-7817 and HARRIS INTERACTIVE INC., (hereinafter “Tenant”) whose address is 135 Corporate Woods, Rochester, New York 14623-1457.

2. STATEMENT OF FACTS

2.1	Bellemead Development Corporation and Total Research Corporation, predecessor in interest to Tenant, heretofore entered into a certain lease dated December 2, 1985, as amended on July 31, 1986, January 5, 1987, November 27, 1990, December 27, 1995, December 12, 1996, February 19, 1998, June 15, 1998, September 28, 1999, December 15, 2000, February 20, 2004 and September 24, 2008 (said lease as it was and may hereafter be amended is hereinafter called the “Lease”) with respect to approximately 29,112 gross rentable square feet (the “Existing Premises”) in a portion of the building commonly known as 5 Independence Way, Princeton, New Jersey (the “Building”); and
2.2	Landlord and Tenant entered into the Ninth Amendment to Lease and Partial Surrender Agreement dated September 24, 2008 whereby Tenant desired to reduce the Existing Premises by approximately 5,627 gross rentable square feet of the Building (“Surrender Premises”), so that the Premises shall therefore consist of approximately 23,485 gross rentable square feet (“Retained Premises”).
2.3	The Effective Date applicable to the Retained Premises is the day Landlord, at Landlord’s sole cost and expense, completes construction of a demising wall between the Surrender Premises and the Retained Premises; and
2.4	It has been determined in accordance with the provisions of Article 3(c) of the Ninth Amendment to Lease and Partial Surrender Agreement that January 1, 2009 is the Effective Date of the Term applicable to the Retained Premises.

3. AGREEMENT

          NOW, THEREFORE, in consideration of the Premises and the covenants hereinafter set forth, Landlord and Tenant agree as follows:

3.1	The above recitals are incorporated herein by reference.
3.2	All capitalized and non-capitalized terms used in this Agreement which are not separately defined herein but are defined in the Lease shall have the meaning given to any such term in the Lease.
3.3	The Effective Date of the Term applicable to the Retained Premises is January 1, 2009 and the Expiration Date thereof is December 31, 2018.
3.4	This Agreement is executed by the parties hereto for the purpose of providing a record of the Effective and Expiration Dates of the Retained Premises, adjusting the Term of the Lease and Minimum Rent amount accordingly.
3.5	Tenant hereby represents to Landlord that (i) there exists no default under the Lease either by Tenant, or to its knowledge, by Landlord; and (ii) there exists no offset, defense or counterclaim to Tenant’s obligation under the Lease.

1

3.6	Except as amended herein, the Lease (as previously amended) shall remain in full force and effect as if the same were set forth in full herein and Landlord and Tenant hereby ratify and confirm all the terms and conditions thereof.
3.7	This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns.
3.8	Each party agrees that it will not raise or assert as a defense to any obligation under the Lease or this Agreement or make any claim that the Lease or this Agreement is invalid or unenforceable due to any failure of this document to comply with ministerial requirements including, but not limited to, requirements for corporate seals, attestations, witnesses, notarizations, or other similar requirements, and each party hereby waives the right to assert any such defense or make any claim of invalidity or unenforceability due to any of the foregoing.

          IN WITNESS THEREOF, Landlord and Tenant have hereunto set their hands and seals the date and year first above written and acknowledge one to the other they possess the requisite authority to enter into this transaction and to sign this Agreement.

LANDLORD:

5 INDEPENDENCE SPE LLC
By: Gale SLG NJ Mezz LLC, sole member
           By: Gale SLG NJ Operating Partnership L.P., sole member
                     By: Gale SLG NJ GP LLC, general partner
                               By: Mack-Green-Gale LLC, sole member
                                         By: Mack-Cali Ventures L.L.C., managing member
                                                  By: Mack-Cali Realty, L.P., sole member
                                                                      By: Mack-Cali Realty Corporation, general partner

By:	/s/ Mitchell E. Hirsch Michael A. Grossman
	Executive Vice President

TENANT:
HARRIS INTERACTIVE INC.
By:	/s/ Deborah Rieger-Paganis		By:	/s/ Marc H. Levin
	Name:	Deborah Rieger-Paganis                       (please print)		Name:	Marc Levin                       (please print)
	Title:	Interim CFO                       (please print)		Title:	SVP and General Counsel                       (please print)

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EX-10.6.27

EXHIBIT 10.6.27

AN AGREEMENT	made this 28th day of May
	Two thousand and Seven

	BETWEEN the Company detailed as the Landlord in Part I of the First Schedule hereto (hereinafter called “the Landlord” which expression shall where the context admits include its successors and assigns) of the one part and the person firm or company detailed as the Tenant in Part I of the First Schedule hereto (hereinafter called “the Tenant”) of the other part.
Premises	WHEREBY IT IS AGREED as follows:
	(1)	The Landlord shall let and the Tenant shall take ALL THOSE premises (hereinafter referred to as “the said premises”) forming part of all that building (hereinafter referred to as “the said Building”) which said premises and Building are more particularly described and set out in Part II of the First Schedule hereto TOGETHER with the use in common with the Landlord and all others having the like right of all entrances, staircases, landings, corridors, passages and lavatories and all the lifts, escalators and central air-conditioning services in the said Building (if and whenever the same shall be operating) in so far as the same are necessary for the proper use and enjoyment of the said premises and except in so far as the Landlord may from time to time restrict such use for the term set out in Part III of the First Schedule hereto (hereinafter referred to as “the said term”) Yielding and Paying therefore throughout the said term the rent and other charges as are from time to time payable in accordance with the provisions set out in Part I, Part II and Part III of the Second Schedule hereto.
	(2)	The Tenant to the intent that the obligations hereunder shall continue throughout the said term hereby agrees with the Landlord as follows:
Rent	2.01		To pay the rent on the days and in the manner set out in Part I of the Second Schedule hereto by auto-pay into a bank account designated by the Landlord or by other means as the Landlord may from time to time direct.
Air-conditioning changes and management fees	2.02		To pay the air-conditioning and management charges on the days and in the manner set out in Part II of the Second Schedule hereto by auto-pay into a bank account designated by the Landlord or by other means as the Landlord may from time to time direct Provided that the Landlord shall be entitled at any time and from time to time during the said term to serve a notice upon the Tenant increasing the air-conditioning and management charges by an amount or amounts which the Landlord shall deem appropriate and thereafter such increased charges shall be payable in lieu of the charges provided for in Part II of the Second Schedule.

Rates and Government Rent	2.03		To pay and discharge all rates, government rent (if any), taxes, assessments, charges, duties, impositions, and outgoings whatsoever now or hereafter to be levied or imposed upon the said premises or upon the owner or occupier thereof by the Government of the Hong Kong Special Administrative Region (“the Hong Kong Government”) or other lawful authorities (Property Tax only excepted). Without prejudice to the generality of this Clause the Tenant shall pay all rates and government rent imposed on the said premises in manner set out in Part III of the Second Schedule hereto in the first place to the Landlord who shall settle the same with the Hong Kong Government and in the event of the said premises not having been assessed to rates or government rent by the Hong Kong Government the Tenant shall pay to the Landlord such sums as shall be required by the Landlord as a deposit by way of security for the due payment of rates and government rent subject to adjustment on the actual assessment of rates and/or government rent being received from the Hong Kong Government.
Utility charges and Deposits	2.04		To pay and discharge all deposits and charges in respect of water electricity telephone and other utilities as may be shown by or operated from the Tenant’s own metered supply or by accounts rendered to the Tenant in respect of all such utilities consumed on or in the said premises.
Interior Fitting Out	2.05.01		To fit out the interior of the said premises in accordance with the plans drawings and specifications as shall have been first submitted to and approved by the Landlord or (if required) the manager of the said Building (“the Manager”) in writing in good proper and workmanlike manner using good quality materials and in all respects in a style and manner appropriate to a first class office building/shopping centre. Without limitation to the generality of the foregoing, the Tenant shall at its own expense:
		(i)	construct furnish or install within the said premises the following items:
			(a)  a ceiling of non-combustible material;
			(b)  such fire extinguishers or other fire-fighting equipment as may be required from time to time by the laws of the Hong Kong Special Administrative Region (hereinafter referred to as “Hong Kong”) including the provisions of sprinkler heads and/or smoke detectors;
			(c)  vertical window blinds, tracks and fittings;
			(d)  floor tiles and floor finishes (PVC tiles shall not be used unless approved by the Landlord);
			(e)  all utilities such as gas and telephone as well as other requirements of the Tenant together with such meters as are necessary to measure the Tenant’s consumption thereof;

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			(f)  all lighting fixtures including lamps, switches and wiring;
		(ii)	paint and decorate the interior of the said premises;
		(iii)	complete all electrical and mechanical installations (including heating, ventilation, air-conditioning, plumbing, drainage and fire services and wiring from the said premises to the meter room and connection of the ventilation and air-conditioning system and the fire services system installed in the said premises to the Landlord’s main system including the installation of fan coil units and sprinkler heads distribution thereto).
Tenant’s Plans	2.05.02	(i)	Prior to the commencement of the fitting out work referred to in Clause 2.05.01 above (“the Fitting Out Work”) the Tenant shall at its own costs and expense prepare and submit to the Landlord for approval plans, drawings and specifications in such details as the Landlord may require in respect of the Fitting Out Work (“the Tenant’s Plans”) which shall include, without limitation, the following:
			(a)  5 sets of ceiling plan showing partition that penetrate into the ceiling void and details of works inside the ceiling void, exact location of light fittings and thermostat control units and proposed relocation, proposed modification to main ceiling trunking system together with schedule on voltage, type, wattage and quantity;
			(b)  5 sets of floor plan showing details of partitions, area of raised flooring and location of heavy equipment;
			(c)  5 sets of electrical layout plan for all case work including the location of all sockets, switches, fuse box and telephone points;
			(d)  5 sets of elevation plan showing design of shopfront/showcase or if an office, its main entrance with details of electric outlets;
			(e)  5 sets of fire services layout plan showing location of existing sprinkler heads and any proposed relocation of addition, location and arrangement of smoke detective system and BTM system if any;
			(f)  5 sets of air-conditioning layout plan showing changes to existing installations, location of thermostats and access panels with schedule of fan coils units and tee-off valves etc.;
			(g)  5 sets of plumbing and drainage plan.

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		(ii)	The Tenant’s Plans shall be submitted to the Landlord for approval in any event within 14 days of the signing of this Agreement. The Landlord may accept reject or modify the Tenant’s Plans or any part thereof and shall notify the Tenant of the same within 14 days after submission of such plans by the Tenant. For the avoidance of doubt, it is hereby expressly agreed that rent shall be payable from the expiry of the rent-free period set out in Part I of the Second Schedule notwithstanding that the Tenant’s plans have not yet been submitted to, or have not yet been approved by the Landlord.
		(iii)	The Tenant shall commence the Fitting Out Work within 30 days of the notice from the Landlord accepting or modifying the Tenant’s Plans (as the case may be) which work shall be completed within the time specified by the Landlord in the said notice.
		(iv)	All mechanical and electrical engineering work relating to the said premises and all decoration work within the said premises shall be carried out and performed by contractors or sub-contractors approved by the Landlord and all other works and arrangements related to the said premises including but not confined to plumbing and fire-fighting installation shall be carried out by contractors or sub-contractors nominated by the Landlord all at the Tenant’s costs and expense and at such time and hour as may be specified by the Landlord.
Vetting Fee	2.05.03		The Tenant shall pay to the Landlord a vetting fee in the sum as set out in Part IV of the Second Schedule hereto in respect of the costs charged by the Landlord’s consultant for approving the Tenant’s Plans and any modifications or amendments thereto and for supervising the Fitting Out Work.
Inspection by Landlord	2.05.04	(i)	The Fitting Out Work shall be subject to the inspection and supervision of the Landlord, the Landlord’s Architect and the Landlord’s General Contractor from time to time during the period in which the said work is being performed.
Reimbursement to Landlord		(ii)	The Landlord shall have the right to perform on behalf of and for the account of the Tenant any of the Fitting Out Work which the Landlord determines shall be so performed. Such work shall be limited to work caused by the Tenant’s fault, and work which pertains to structural components, the general utility systems for the said Building and the erection of temporary safety barricades and temporary signs during construction.
Sundry expenses during fitting out period	2.05.05	(i)	The Tenant shall pay to the Landlord such charges in respect of supply of temporary electricity to the said premises as the Landlord may decide together with the installation costs for such supply and other sundry expenses incurred by the Landlord by reason of the Tenant’s Fitting Out Work being carried out on the said premises and the Landlord may deduct such sums from the deposits mentioned in Clause 2.05.05(ii) below.

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		(ii)	The Tenant shall at the signing of this Agreement deposit with the Landlord (a) a sum as set out in Part V of the Second Schedule hereto to secure the due performance and observance of the Tenant’s obligations under this Clause 2.05 and (b) a further sum as set out in Part VI of the Second Schedule hereto to defray the aforesaid sundry expenses and temporary electricity charges which sums shall, subject to any deduction that the Landlord is entitled to make under this Agreement, be refunded to the Tenant without interest within 30 working days after the completion of the Fitting Out Work.
Statutes, Codes & Ordinance	2.06	The Tenant shall have the sole responsibility to comply with all applicable statutes, codes, ordinances and regulations for all works performed by or on behalf of the Tenant within the said premises and approval by the Landlord or the Landlord’s agent of plans, specifications, calculations or otherwise of any works shall not constitute any implication, representation or certification by the Landlord that such works are in compliance with any statutes, codes, ordinances or regulations.
Contractors’ Insurance	2.07	The Tenant shall procure that any contractors engaged by the Tenant to carry out any works relating to the said premises effect third party liability insurance in such sum as the Landlord may require and that the relevant insurance policy be produced to the Landlord as and when so required by the Landlord. The Landlord will not otherwise permit any works to be carried out by such contractors.
Telephone System	2.08	To install at the Tenant’s own expense empty conduits for telephone service to the said premises. Telephone service to said premises shall only be installed by PCCW-HKT Limited or other licensed telephone company and the Tenant shall pay to the Landlord the expenses incurred in the installation of telephone jacks and conduits to the said premises.
Pass for Services	2.09	To permit permanent utility lines including but not limited to drains, gas and water pipes and electricity and other wires to pass through the said premises to service other premises and areas in the said Building and to permit the Landlord and all persons authorised by it to enter the said premises to carry out any works repairs or maintenance which require to be done.
Design Loads	2.10	(i)	Loading imposed by any of the Tenant’s work on a temporary or permanent basis shall not exceed the designed live load.
		(ii)	The Landlord shall be entitled to prescribe the maximum weight and permitted location of safes and other heavy equipment and to require that the same shall stand on supports of such dimensions and materials to distribute the weight as the Landlord may deem necessary.

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		(iii)	Except for suspended ceilings and duct work, the Tenant shall not support any equipment, partitions or other work on or from the Landlord’s walls, structure or roof deck without the Landlord’s prior approval in writing.
Floor Load		(iv)	The Tenant shall not put or permit to be put any equipment, goods, stocks or things whatsoever on the said premises the load of which exceeds the designed live load of the premises under the Building Ordinance.
Installation & Alteration	2.11	(i)	Not without prior written consent of the Landlord to make or permit any alteration or addition to the said premises or any part thereof either internally or externally or to any fixtures or fittings or electrical wiring or electrical mechanical or ventilation and air-conditioning installations or fire services systems or any other system or facilities therein or to any item therein or any other equipment machinery appliances or anything whatsoever (whether or not of a structural nature). Upon determination of this Agreement the Tenant shall at his own expense remove all decoration or partitions so erected or installed by the Tenant and restore the said premises to its original state upon being required so to do by the Landlord.
		(ii)	The Tenant shall employ at his own costs and expense the Landlord’s nominated contractor or consultant for the purpose of carrying out any of the permitted alterations additions or improvements (except for mechanical and electrical work and decoration work within the said premises which may be carried out by contractors approved by the Landlord.)
		(iii)	To observe and comply with all rules and regulations and instructions from time to time prescribed by the Landlord or its authorised representative or officer in carrying out any permitted alterations additions or improvements to the said premises.
		(iv)	The Tenant shall have the sole responsibility to observe and comply with all applicable statutes, codes, ordinances and regulations for all works performed or to be performed by or on behalf of the Tenant and approval by the Landlord of any plans or specifications or otherwise shall not constitute or be deemed to constitute any implication representation or warranty that the said works are in compliance with any statutes, codes, ordinances or regulations.
		(v)	To observe and comply with all rules regulations and instructions from time to time by The Hongkong Electric Company Limited or the relevant authority relating to the electrical wiring and installation in the said premises.

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		(vi)	All fees and expenses incurred by the Landlord in connection with the giving of consents under this Clause shall be borne by the Tenant.
Injury to main walls ceilings, floors, doors and windows	2.12	Not to cut maim injure damage alter or interfere with any of the doors windows walls structural members pipes drains appurtenances electrical cables wires fixtures or fittings of or in the said premises or any part thereof or suffer or permit the same to be done.
Compliance with Ordinances	2.13	To comply with all ordinances regulations by-laws, and all notices and requirements of the appropriate Government or other competent authorities or the Manager in connection with or in relation to the use of the said premises and to keep the Landlord indemnified against all proceedings actions claims demands and liabilities in respect thereof and all costs and expenses incurred by the Landlord thereon and upon receipt of any such notice concerning or in respect of the said premises as aforesaid forthwith to deliver to the Landlord a copy of such notice.
Good repair of interior	2.14	(i)	To keep all the interior and/or non-structural parts of the said premises including the flooring and interior plaster or other finishing material or rendering to walls and all ceilings and the Landlord’s fixtures therein and all additions thereto and the doors, windows, ventilation and air-conditioning system, fire-fighting equipment, electrical installations, wiring, fan coil units, thermostat control and sprinkler heads thereof (whether or not the same is installed by the Tenant) in good, clean and tenantable repair and condition and as may be appropriate from time to time properly painted and decorated so as to maintain the same at the sole expense of the Tenant throughout the said term and to yield up the same in such repair and condition at the end or sooner determination of the said term.
		(ii)	To observe and comply with all rules and regulations and instructions from time to time prescribed by the electricity supply company and/or the relevant authority relating to the electrical wiring and installation in the said premises and to repair or replace all electrical wiring installations and fittings within the said premises and the wiring from the Tenant’s meter(s) to and within the same whenever required by the supply company, statutory undertake or other competent authority.
		(iii)	To indemnify the Landlord against all costs, claims, demands, actions, liabilities and legal proceedings whatsoever made upon the Landlord by any person in respect of any breach of this covenant.
Grease Trap (if applicable)	2.15	To install its own grease trap(s) in order to comply with the relevant Government regulations for the operation of a restaurant and to keep any grease trap serving the said premises in good clean and proper repair and condition at all times during the said term to the satisfaction of the Landlord and in accordance with the regulations of the Government authorities concerned.

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Good repairs & replacement of sanitary apparatus	2.16	(i)	To keep all taps lavatories wash basins sinks sanitary and water apparatus and other pipes and all drains (if any) located within the said premises (and such lavatories and water apparatus as are located elsewhere in the said Building and used exclusively by the Tenant and/or its servants agents and licensees) in clean and tenantable state and in proper repair and condition at all times during the said term to the satisfaction of the Landlord and in accordance with the regulations of the Government Authority concerned.
Toilet Facilities		(ii)	To use in common with others the lavatories and washing accommodations and facilities provided by the Landlord in the said Building and not to permit or suffer the same to be used in any improper manner or whereby the soil or waste pipes may become impeded or blocked and at all times to indemnify the Landlord against liability for loss damage or injury by the escape of water caused to the property or the tenants or occupiers of any other part(s) of the said Building.
Replacement of Doors & Window Glass	2.17	To replace at the Tenant’s expense all broken or damaged windows doors glass and fixtures whether the same shall have been broken or damaged by the negligence of the Tenant or owing to circumstances beyond the control of the Tenant.
Cleansing & Clearing of Drains	2.18	In the event of the pipes or drains of the said Building becoming choked or stopped up owing to the careless use by the Tenant its servants agents licensees invitees the Tenant shall pay the costs incurred by the Landlord in cleansing and clearing the same.
Indemnity against loss/damage from Interior Defects	2.19	To be responsible for and to fully and effectually indemnify the Landlord from and against any proceedings actions claims and demands whatsoever by any person for any loss damage or injury caused to or suffered by any person whomsoever or any property whatsoever including any loss of business or profit as a result of or otherwise arising from the want of repair of the said premises or any fixtures or fittings therein the repair of which the Tenant is responsible hereunder or the spread of fire or smoke or the overflow of water or the escape of any substance or anything from the said premises and against all costs and expenses of the Landlord incurred in respect of any such proceedings actions claim or demand.
Insurance	2.20	(i)	To effect and maintain during the said term insurance cover in respect of the risks mentioned in Clause 2.19 above and such other risks as the Landlord may deem appropriate. The policy of insurance shall be effected with an insurance company approved by the Landlord for a coverage of not less than HK$5,000,000.00 for any one claim or in such amount as the Landlord may determine and which policy shall be endorsed to show the

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			Landlord as the registered owner of the said premises and shall contain a Clause to the effect that the insurance cover thereby effected and the terms and conditions thereof shall not be cancelled modified or restricted without prior written consent of the Landlord. The Tenant undertakes to produce to the Landlord as and when required by the Landlord such policy of insurance together with a receipt for the last payment of premium and a certificate from the relevant insurance company that the policy is fully paid up and in all respects valid and subsisting on request Provided always that if the Tenant shall at any time fail to keep such insurance in force the Landlord may do all things necessary to effect and maintain in force such insurance and any monies expended by the Landlord for that purpose shall be recoverable from the Tenant on demand.
Insurance Policy		(ii)	Not to do or permit to be done anything whereby the policy or policies of insurance of the said Building against damage by fire or other perils for the time being subsisting may become void or voidable or whereby the rate of premium thereon may be increased and without prejudice to any other rights and/or remedies the Landlord may have hereunder all expenses incurred by the Landlord in or about any renewal of such policy or policies or any increased premium rendered necessary or payable by a breach of this term shall be home by the Tenant and shall be recoverable from the Tenant by the Landlord on demand.
Protection against storm or typhoon	2.21	To take all necessary precautions to protect the said premises against damage by storm or typhoon heavy rainfall or the like.
Entry by the Landlord to view the premises	2.22	To allow and permit the Landlord and/or the Manager and/or their respective authorised agents to enter upon the said premises at all reasonable times to see and inspect that no alteration has been made to the said premises or the fixtures or fittings therein and that all work is carried out in accordance with the plans approved by the Landlord and that the interior of the said premises is properly required and maintained.
Entry by the Landlord to carry out repairs and take inventories	2.23	To permit the Landlord and/or the Manager and/or their respective authorised agents at all reasonable times to enter the said premises for the purposes of taking inventories of the Landlord’s fixtures therein and carrying out any works repairs or maintenance which require to be done provided that in the event of emergency the Landlord or its authorised agents may without notice enter the said premises forcibly and the Tenant shall at its own expense reinstate the entrance to the said premises to its original state.
Carry out repairs or receipt of notice to effect the same	2.24	On receipt of any notice from the Landlord or its authorised representatives specifying any works or repairs which require to be done and which are the responsibility of the Tenant hereunder, forthwith to put in hand and execute the same with all possible despatch and without any delay. If the Tenant fails to do so the

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		Landlord or its servants or agents shall be entitled, without prejudice to the Landlord’s right of re-entry under the provisions hereinafter contained, to enter upon the said premises and forcibly if need be to carry out any such works or repairs at the sole expense of the Tenant.
Entry by the Landlord to close windows and doors	2.25	To keep all windows and doors of the said premises closed and to permit the Landlord or its servants and agents and others from time to time during the said term to enter upon the said premises for the purpose of closing any doors or windows.
Notify Landlord of damage	2.26	To notify the Landlord in writing or by other reasonable means of any accidents or damage to or defects in the water pipes gas pipes electrical wire or fittings fixtures or other facilities provided by the Landlord in the said premises whether or not the Tenant is liable hereunder for the repair of the same forthwith upon the same arising and to indemnify the Landlord against any claim made against the Landlord by any third party and any loss suffered by the Landlord either directly or indirectly as a result of any breach by the Tenant of this provision.
To make good & take care of all articles provided by Landlord	2.27	To make good and pay for all damage caused by the Tenant its servants or licensees to any fixtures, fittings (including the ventilation and air-conditioning system and fire services system) and other articles in the said premises and provided by the Landlord and shall take reasonable care of the same and shall not remove any of them from the said premises.
Cleaning Contractors	2.28	To employ at the expense of the Tenant only such cleaners as may be nominated by the Landlord for the cleaning of the said premises.
Removal of garbage	2.29	(i)	To be responsible (at its own expense) for the removal of garbage and refuse the said premises to such location as shall be specified by the Landlord or its agents from time to time and to use only that type of refuse container as is specified by the Landlord or its agents from time to time.
		(ii)	In the event of the Landlord providing a collection service for refuse and garbage the same shall be used by the Tenant to the exclusion of any other similar service and the use of such service provided by the Landlord shall be at the sole cost of the Tenant.
Re-letting Notice	2.30	To permit the Landlord during the three (3) months immediately preceding the termination of the said term to affix and retain without interference on any part of the said premises a notice for re-letting the same and during such period to permit persons with written authority of the Landlord or its agents at reasonable times of the day to view the said premises.
Lifts & Escalators	2.31	Not to place or take in the passenger lifts or escalators any bulky baggage parcels sacks bags equipments or other goods.

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Animals, Pets & Pest Control	2.32	Not to keep or permit or suffer to be kept upon any part of the said premises any livestock or animals and to carry out such pest control for the said premises upon request of the Landlord by pest control companies nominated by the Landlord at the Tenant’s expense.
Preparation of food	2.33	Not to prepare or permit or suffer to be prepared any food in the said premises nor to cause or permit any offensive or unusual odours to be produced upon, permeate through or emanate from the said premises.
Offensive Trades	2.34	Not to carry on or to permit or suffer to be carried on in or upon the said premises or any part thereof any trade or business which the Landlord shall in its absolute discretion regards as dangerous noxious noisy or offensive.
Sale by Auction or others	2.35	Not to carry on or to permit or suffer any sale to the public by auction or any other means to take place upon the said premises.
Nuisance or Annoyance	2.36	Not to do or permit or suffer anything in the said premises or in the said Building which is or may be a nuisance or annoyance to the Landlord or any other tenants or occupiers of the said Building or of any adjoining building or affect the reputation of the said Building as a high class commercial building/shopping centre.
Noise	2.37	Not to produce or permit or suffer to be produced any music or noise (including sound produced by broadcasting or any apparatus or equipment capable of producing, reproducing, receiving or recording sound) so as to be audible outside the said premises which may be a nuisance or annoyance to the tenants or occupiers of other premises in the said Building.
Sign and Advertisement	2.38	(i)	Not to affix erect attach exhibit or permit or suffer so to do or to be done upon any part of the said Building or of the exterior of the said premises or to or through any windows thereof any sign signboard notice advertisement placard neon light or other device of any kind whether illuminated or not (hereinafter referred to as “the signboard”) without the prior written approval of the Landlord and the approval of all appropriate government authorities.
		(ii)	To maintain any signboard approved under Clause 2.38(i) above at all times in good repair and condition and to meet all the requirements that may from time to time be imposed by any Government authorities and to dismantle and remove the signboard on the termination of this Agreement or if so required by any Government or competent authority or the Manager and to make good any damage done and to indemnify the Landlord against all loss, damages and liability that may be suffered, paid or incurred by the Landlord and any proceedings actions claims and demands against the Landlord by any person whatsoever and any costs and expenses incurred by the Landlord in respect of any such proceedings action claim or demand as a result of or otherwise arising from the installation or any defects in the signboard.

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		(iii)	Notwithstanding Clause 2.38(i) above, the Tenant may at its own expense display its name and the nature of its trade or business on the Directory Boards provided by the Landlord on the maindoor of the said premises but only in such form and character as shall be determined or approved in writing by the Landlord in its absolute discretion.
Directory Board	2.39	(i)	The Tenant’s name to appear on the Directory Board and the signboard shall strictly be in accordance with that appearing in Part IV of the First Schedule hereto unless prior written approval to name otherwise has first been obtained from the Landlord.
		(ii)	The Tenant shall if so required by the Landlord sign or execute such agreements or documents as the Landlord may deem appropriate in respect of any change of the Tenant’s name under Clause 2.39(i) above and the Tenant shall be responsible for all costs and expenses incurred thereby including any registration fee payable.
		(iii)	To pay the Landlord or its agents immediately upon demand the costs of affixing, repairing, altering or replacing as necessary the Tenant’s name on the Directory Board (if any) provided by the Landlord.
User	2.40	Not to use or permit or suffer the said premises or any part thereof to be used for any purpose other than as set out in Part VI of the First Schedule hereto and without prejudice to the foregoing to obtain any licence approval or permit required by any Government or other competent authority in connection with the Tenant’s business or its use or occupation of the said premises prior to the commencement of the Tenant’s business and to maintain and keep in force such licence approval or permit during the currency of this tenancy and to indemnify the Landlord against the consequences of a breach of this provision and in particular not to use or permit the same to be used for domestic purpose or as sleeping quarters and not to allow any person to remain in the said premises overnight. For the avoidance of doubt, the Landlord does not warrant whether the said premises can be used for any purpose other than that stated in the Occupation Permit of the said Building or whether the said premises are suitable or may be used for the Tenant’s intended purpose.
Business Name	2.41	The name under which the business in the said premises shall be carried on is as set out in Part IV of the First Schedule hereto.
Illegal or Immoral use	2.42	Not to use or permit or suffer the said premises to be used for the purpose of gambling or for any illegal immoral or improper purpose.

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Combustible Dangerous Goods	2.43	Not to keep store use or bring into the said premises or any part thereof any unlicensed arms ammunition or unlawful goods gun-powder spirits or saltpetre kerosene or other explosive or combustible substances or any dangerous goods within the meaning of the Dangerous Goods Ordinance and then only in compliance with all relevant legislation and Government regulations.
Obstructions in Common Area	2.44	Not to place or leave in the entrances landing staircases driveways passages lobbies or any parts of the said Building in common use any box or any thing or things rubbish or otherwise which may incumber or obstruct the same. Without prejudice to the Landlord’s rights and remedies hereunder, the Landlord and the Manager shall be entitled without notice and at the Tenant’s expense to remove and dispose of any such material aforesaid as it sees fit and the Landlord and the Manager shall not thereby incur any liability to the Tenant or any other person whosoever and the Tenant shall indemnify the Landlord against all losses damages expenses or liabilities that may be suffered, paid or incurred by and any claims proceedings actions and demands made against the Landlord in respect thereof.
Bulky Deliveries	2.45	Not to take or allow delivery of furniture fixtures or bulky items of goods in and out of the said Building except with the prior written approval of the Landlord and at such times and through such entrances as shall be designated by the Landlord from time to time and to use only the service lifts provided by the Landlord for such purposes.
Breach of Government Lease	2.46	Not to do or suffer any act to be done which shall amount to a breach or non-observance of any covenants and conditions in the Government Lease or Conditions under which the Land (as defined in Part II of the First Schedule hereto) is held from the Government and to indemnify the Landlord against any breach thereof.
Assignment & underletting	2.47	Not to assign underlet or otherwise part with the possession of the said premises or any part thereof in any way whether by way of subletting lending sharing or other means whereby any person or persons not a party to this Agreement obtains the use or possession of the said premises or any part thereof irrespective of whether any rental or other consideration is given for such use or possession and in the event of any such transfer sub-letting sharing assignment or parting with the possession of the said premises (whether for monetary consideration or not) this Agreement shall at the option of the Landlord absolutely determine and the Tenant shall forthwith surrender and vacate the said premises on notice to the effect from the Landlord. The Tenancy shall be personal to the Tenant and without in any way limiting the generality of the foregoing the following acts and events shall, unless approved in writing by the Landlord, be deemed to be breaches of this Clause:
		(i)	In the case of a Tenant which is a partnership the taking in of one or more new partners whether on the death or retirement of an existing partner or otherwise.

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		(ii)	In the case of a Tenant who is an individual (including a sole surviving partner of a partnership Tenant) the death insanity or disability of that individual to the intent that no right to use possess occupy or enjoy the said premises or any part thereof shall vest in the executors administrators personal representatives next of kin trustee or committee of any such individual.
		(iii)	In the case of a Tenant which is a corporation any liquidation.
		(iv)	The giving by the Tenant of a Power of Attorney or similar authority whereby the donee of the Power obtains the right to use possess occupy or enjoy the said premises or any part thereof or does in fact use possess occupy or enjoy the same.
		(v)	The change of the Tenant’s business name without the previous written consent of the Landlord.
	Provided that if there is any take-over reconstruction amalgamation merger or change in the person or persons who owns or own a majority of its voting shares or who otherwise has or have effective control thereof, the Tenant shall provide at least 14 days prior written notice together with full particulars thereof to the Landlord and the Landlord shall have the right to require the Tenant to procure a director of the Tenant acceptable to the Landlord to execute a personal guarantee to secure the due observance and performance by the Tenant of the terms and conditions of this Agreement in the form and substance and within such time period as the Landlord may deem appropriate.
Aerials	2.48	Not to affix to the said Building or any part thereof any aerial or similar apparatus without the consent of the Landlord in writing and not to remove dismantle or alter those common aerials (if any) provided by the Landlord.
Fire	2.49	(i)	Compliance with Codes and Regulations for additional fire protection system apart from those provided by the Landlord whether or not induced by the business of the Tenant shall be the responsibility of the Tenant, and the costs so incurred shall be borne by the Tenant.
		(ii)	To ensure at all times that all fire alarms, fire-fighting equipment, roller shutters (if any) and other equipment for security purpose (if any) provided by the Landlord shall not be disrupted, interrupted, damaged or caused to be defective through the act, default or neglect of the Tenant, its servants, agents, licensees or customers.
Yield up	2.50	To quietly yield up the said premises together with all fixtures, fittings (other than the Tenant’s own furniture) and additions therein and thereto at the expiration or sooner determination of this Agreement in good, clean and tenantable repair and condition in accordance with the

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		provisions herein contained notwithstanding any rule of law or equity to the contrary Provided That (i) where the Tenant has made any alteration or improvement or installed any fixtures fittings or additions to the said premises (including the ventilation and air-conditioning system and fire services system therein), whether with or without the Landlord’s consent, the Landlord may in its absolute discretion retain such fixtures, fittings, additions or improvements as the Landlord may wish to retain without any payment to the Tenant whether by way of compensation or otherwise and (ii) if the Landlord shall require the said premises to be delivered up in a bare shell condition or the removal of any additions, alterations, fittings or fixtures, then the Tenant shall at its own cost and expense remove all or such of the additions alterations, fittings, or fixtures as so required by the Landlord, whether the same be made or installed by the Tenant, and make good and repair in a good and workmanlike manner all damage caused by such removal to the satisfaction of the Landlord. The Tenant shall further procure a chemical cleaning of all fan coil units in the said premises to the satisfaction of the Landlord upon expiration or sooner determination of this Agreement and thereupon shall surrender to the Landlord all keys giving access to all parts of the said premises and remove at the Tenant’s expense all lettering and characters from all the doors, walls, or windows of the said premises and make good all damage caused by such removal.
Keeping the said Premises open for Business	2.51	To keep the said premises open for business at all times of the year during the normal business hours of the said Building namely the hours set forth in Part I of the Third Schedule hereto and without prejudice to the generality of the foregoing any suspension of the Tenant’s business for a period of more than 7 days without the prior written consent of the Landlord shall constitute a material breach of this provision entitling the Landlord to determine this Agreement and to regain possession of the said premises.
Tenant liable for acts and omissions of others	2.52	To be answerable and responsible to the Landlord for the acts, neglects and defaults or omission of all contractors, servants, agents, invitees and licensees of the Tenant as if they were the acts, neglects and default or omission of the Tenant itself and to indemnify the Landlord against all costs claims demands expenses or liability to any third party in connection therewith and for the purposes of this Agreement “licensee” shall include any person present in, using or visiting the said premises with the consent of the Tenant express or implied.
Obey Building Rules	2.53	To obey and comply strictly with the rules and regulations from time to time adopted by the Landlord or the Manager whether relating to the management and security of the Building or otherwise, to furnish first class service to customers and to conduct the business of the Tenant so as not to prejudice the goodwill and reputation of the said Building as a first class commercial building/shopping centre.

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Observance to the Deed of Mutual Covenant and Management Agreement	2.54	To observe and comply with and not to permit or suffer anything to be done which may amount to a breach or non-observance by the Landlord or any terms and provisions in the Deed of Mutual Covenant relating to the said Building (“the said Deed of Mutual Covenant”) and/or Management Agreement (if and when the same shall come into operation) and to indemnify the Landlord against the breach non-observance or non-performance thereof. It is also expressly agreed and declared that the Landlord shall have the full right and liberty at any time hereafter to enter into such form of Deed of Mutual Covenant and/or Management Agreement with the owners of the said Building or such other parties as the Landlord shall think fit to define their respective rights and obligations of and in the Land and the said Building and to make provision for the management of the said Building.
No wiring etc. in common areas	2.55	Not to install affix or attach any wiring, cables or other article or thing in or upon any of the entrances, staircases, landings, passageways, lobbies or public areas of the said Building.
No touting	2.56	Not to permit any touting or soliciting for business or distributing of any pamphlets, notices or advertising matter to be conducted outside or near the said premises or in any part of the said Building by any of the Tenant’s servants, agents or licensees.
Not to drive nails etc.	2.57	Not without the consent of the Landlord to drive or insert or permit or suffer to be driven or inserted any nails, screws, hooks, brackets or similar articles into the ceilings, doors, walls, window beams or floor of the said premises.
	2.58	Not to name or include in the name of the business at the said premises the name of the said Building and/or the words “Lai Sun” whether in English or Chinese Characters or any name which the Landlord regards as similar thereto.
Maintain displays (if applicable)	2.59	To install and at all times maintain displays of merchandise goods or services in any shopfront windows or showcases contained within the entrance ways to the said premises to the satisfaction of the Landlord and to a standard and composition appropriate in the opinion of the Landlord to the reputation and standing of the said Building, and to alter any window or other display of goods or merchandise in or at the said premises immediately upon notice by the Landlord that such displays will in the opinion of the Landlord prejudice the reputation or standing of the said Building.
Keep shopfronts lit (if applicable)	2.60	The Tenant shall at its own expenses keep lit any shopfront windows and showcase together with the shop signs of the said premises during such normal business hours as are specified in paragraph (a) of Part I of the Third Schedule hereto. For the purpose of this Clause shopfront windows shall include those parts of the interior of the said premises used for the display of merchandise goods or services immediately fronting onto the common areas of the said Building.

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Not to obstruct shopfront window (if applicable)	2.61	Not to block or darken or obstruct or obscure the shopfront window or any other window or lights belonging to the said premises without having obtained the written consent of the Landlord which consent may be given subject to such conditions as the Landlord may in its absolute discretion consider fit to impose.
	(3)	THE LANDLORD HEREBY AGREES WITH THE TENANT AS FOLLOWS:
Quiet Enjoyment	3.01	Subject to the Tenant paying the rent and other charges set forth in Clause 2 hereof and any other charges which may become payable by the Tenant under this Agreement and the Tenant observing and performing the terms and covenants contained in this Agreement to permit the Tenant to have quiet possession and enjoyment of the said premises during the said term without any interruption by the Landlord or any one lawfully claiming under or through or in trust for the Landlord.
Property Tax	3.02	To pay all Property Tax on the said premises during the said term.
Roof and Main Structure	3.03	To keep in good condition and proper repair the roof the main structure and external walls of the said Building and the main pipes drains and cables and to do all structural repair required to be done at any time Provided that the Landlord’s liability under this Clause 3.03 shall not arise unless and until written notice of any defect or want of repair has been given by the Tenant to the Landlord and the Landlord shall have failed to take reasonable steps to repair or remedy the same after the lapse of a reasonable time from the date of service of such notice.
	(4)	PROVIDED always and it is hereby expressly agreed and declared by the parties as follows:
Default	4.01	If and whenever the rent hereby reserved or any part thereof shall be in arrear for 15 days whether the same shall have been legally demanded or not or if any term, condition or stipulation on the Tenant’s part herein contained shall not be performed or observed or if the Tenant for the time being shall become bankrupt or enter into any composition or arrangement with the Tenant’s creditors or suffer any distress or execution to be levied on the Tenant’s goods or if the Tenant shall suffer any prosecution in respect of the non-payment of money due to the Hong Kong Government or if the Tenant for the time being is a company and shall enter into liquidation whether compulsory or voluntary (save for the purpose of reconstruction or amalgamation) or if any petition shall be presented for the winding up of the Tenant then and in any of the said cases it shall be lawful for the Landlord at any time thereafter to re-enter upon the said premises or any part thereof in the name of the whole and forfeit the Deposit (as defined in Clause 4.10 hereof) or such part thereof held by the Landlord and thereupon the tenancy hereby created shall absolutely determine but without prejudice to the right of the Landlord in respect of any breach by the Tenant of any terms, conditions or stipulations herein contained or to

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		the Landlord’s right to deduct all loss and damage thereby incurred from the Deposit and in particular the Landlord shall have the right to terminate or disconnect the supply of air-conditioning water electricity and other facilities to the said premises upon the occurrence of any of the above event of default.
Exercise of Right	4.02	A written notice served by the Landlord on the Tenant in manner hereinafter provided to the effect that the Landlord thereby exercises the power of re-entry herein contained shall be a full and sufficient exercise of such power without actual entry on the part of the Landlord.
Acceptance of Rent	4.03	In the event of any breach of any term stipulations and conditions on the part of the Tenant herein contained the Landlord shall not by acceptance of rent or by any other act whatsoever or by any omission be deemed to have waived any such breach notwithstanding any rule of law or equity to the contrary and that no consent to or waiver of any breach shall be binding on the Landlord unless the same is in writing under the hand of the Landlord.
Abatement of Rent	4.04	If the said premises or the said Building or any part thereof shall be destroyed or so damaged by fire, typhoon, Act of God, force majeure or other cause beyond the control of the Landlord and not attributable to any act or default or negligence of the Tenant as to render the said premises unfit for commercial use and the policy or policies of insurance effected by the Landlord shall not have been vitiated or payment of policy moneys refused in whole or in part in consequence of any act or default or negligence of the Tenant or if at any time during the continuance of this Agreement the said premises or the said Building shall be condemned as a dangerous structure or a demolition or closing order shall become operative in respect of the said premises or the said Building then the rent hereby agreed to be paid or a part thereof proportionate to the damage sustained or order made shall cease to be payable until the said premises or the said Building or part thereof shall have been restored or reinstated or the order removed Provided Always that the Landlord shall be under no obligation to reinstate the said premises or the said Building or part thereof And Provided further that should the said premises or the said Building or part thereof not have been reinstated or the order removed in the meantime either the Landlord or the Tenant may after six months of the occurrence of the destruction or damage or order give to the other of them notice in writing to terminate this Agreement but without prejudice to the rights and remedies of either party against the other in respect of any antecedent claim or breach of the agreements stipulations terms and conditions herein contained or of the Landlord in respect of the rent payable hereunder prior to such notice.
Liability & Indemnity	4.05	The Landlord shall not be under liability whatsoever to the Tenant or to any persons whomsoever in respect of any damage sustained by the Tenant or such other person aforesaid caused by or through or in any way owing to the spread of fire or smoke or the overflow of water or

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		the escape of any substance or anything from any premises situate in the said Building or caused by the act default or negligence or any tenant or occupier of such premises. The Tenant shall fully indemnify the Landlord against all claims demands actions and legal proceedings whatsoever made upon the Landlord in respect of any damage to any person whomsoever caused by the negligence of the Tenant or by or through or in anywise owing to the spread of fire or smoke or the overflow of water or the escape of any substance or anything from the said premises.
Acts of Servants, agents etc.	4.06	For the purpose of this Agreement any act default omission or negligence of the contractors servants agents licensees or invitees of the Tenant shall be deemed to be the act default omission or negligence of the Tenant.
Accidents	4.07	The Landlord shall not be responsible to the Tenant or the Tenant’s licensees servants agents or other persons in the said premises for any accident happening or injury suffered or damage to or loss of any chattel or property sustained on the said premises or in the said Building.
Security	4.08	The Landlord shall not be liable in any circumstances to the Tenant or any other person whomsoever for the security or safekeeping of the said premises or any persons or contents therein.
Distraint	4.09	For the purpose of Part III of the Landlord and Tenant (Consolidation) Ordinance relating to distress for rent or of these presents the rent payable in respect of the said premises shall be and be deemed to be in arrear if not paid in advance at the time and in manner hereinbefore provided for payment thereof. All costs and expenses for and incidental to the distraint shall be paid by the Tenant and shall be recoverable from it as a debt.
Deposit	4.10	(i)   The Tenant shall on the signing of this Agreement pay to the Landlord the sum as set out in Part V of the First Schedule hereto (“the Deposit”) to secure the due observance and performance by the Tenant of agreements stipulations terms and conditions herein contained and on the Tenant’s part to be observed and performed. The Deposit shall be retained by the Landlord throughout the said term free of any interest to the Tenant and if the Tenant shall commit or suffer to be committed a breach of any of the terms and conditions herein the Landlord shall be entitled to terminate this Agreement in which event the Deposit shall be forfeited to the Landlord but without prejudice to any right of the Landlord in respect of any antecedent breach by the Tenant of the terms and conditions herein contained. Notwithstanding the foregoing the Landlord may in any such event at its option elect not to terminate this Agreement but to deduct from the Deposit the amount of any monetary loss incurred by the Landlord in consequence of the breach non-observance or non-performance by the Tenant in which event the

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		Tenant shall as a condition precedent to the continuation of this tenancy deposit with the Landlord the amount so deducted and if the Tenant shall fail so to do the Landlord shall forthwith be entitled to re-enter the said premises or any part thereof in the name of the whole and to determine this Agreement in which event the Deposit may be forfeited to the Landlord as hereinbefore provided. Subject as aforesaid, the Deposit shall be refunded to the Tenant by the Landlord without interest within thirty working days after the expiration or sooner determination of this Agreement and the delivery of vacant possession to the Landlord or within thirty working days of the settlement of the last outstanding claim by the Landlord against the Tenant in respect of any breach, non-observance or non-performance of any of the terms and conditions herein contained and on the part of the Tenant to be observed and performed whichever is the later.
		(ii)  During the said term the Tenant shall maintain the Deposit at the sum equal to three month’s rent, air-conditioning and management charges and one quarter’s rates and government rent and if the rent or the air-conditioning and management charges, rates and government rent shall be increased the Tenant shall forthwith on demand pay to the Landlord the additional amount to make up such deposit.
Service of Notice	4.11	Any notice hereunder shall be in writing and any notice to the Tenant shall be sufficiently served if left addressed to the Tenant on the said premises or sent to the Tenant by post or left at the Tenant’s last known address in Hong Kong and any notice to the Landlord shall be sufficiently served if delivered to the Landlord personally or sent to the Landlord by registered post at the Landlord’s registered office in Hong Kong.
Approval of the Landlord	4.12	No approval by the Landlord is valid unless it is in writing and signed by the Landlord or by its authorised agents and any approval or consent given by the Landlord shall operate as a consent for the particular matter to which it relates only and shall in no way be considered as a waiver or release of any of the provisions hereof nor shall it be construed as dispensing with the necessity of obtaining the specific written consent of the Landlord in the future, unless expressly so provided.
No premium	4.13	The Tenant hereby expressly declares that at the grant of the said term no premium key money or other consideration has been paid to the Landlord or to any person.
Interest on arrears of rent and other charges	4.14	Without prejudice to the Landlord’s rights under Clause 4.01 hereof, the Tenant shall pay interest on all arrears of rent and other charges at a rate of 2.5% per month from the due date to the date of payment together with all legal costs and disbursements on a solicitor and client basis incurred for demanding and enforcing payment of the said arrears or outstanding sum in Court or otherwise on demand and until payment they shall be deemed to be a debt due by the Tenant to the Landlord.

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Name of the Building	4.15	The Landlord reserves the right exercisable at any time or times to change the name or description of the said Building or any part thereof without incurring any liability to the Tenant on any account whatsoever provided that the Landlord shall give to the Tenant not less than three months’ notice in writing of any such proposed change.
Renovation	4.16	The Tenant hereby expressly acknowledges that the Landlord may from time to time carry out any building, construction, renovation, refurbishment and other works in such part or parts of the Land and/or the said Building as the Landlord may deem fit and that the Landlord, its contractors agents workers and other persons authorized by the Landlord may enter into and upon any part of the Land and/or the said Building with necessary plant equipment and material for such purpose. It is hereby expressly agreed that the Tenant shall have no right to claim against the Landlord for breach of any of the terms conditions or stipulations herein contained and on the Landlord’s part to be observed and performed and the Landlord shall not incur any liability to the Tenant and/or any person whatsoever in respect of any loss, damage, claim, cost or expense (including but not limited to loss of business and/or profit) that may be caused by or otherwise arising from or in connection with such works whether on the ground of inconvenience disturbance interruption of services noise dirt or otherwise.
Sale and Redevelopment	4.17	If the Landlord shall at any time resolve to demolish, re-build or refurbish the said Building or any part thereof (which intention shall be sufficiently evidenced by a copy of the Resolution of its Board of Directors certified by its Secretary or a Director to be a true and correct copy) or shall have entered into any agreement for sale and purchase of the said Building or any part thereof which include the said premises, then in any of such event the Landlord shall be entitled to give not less than 6 calendar months’ notice in writing to expire at any time to terminate this Agreement, and immediately upon the expiration of such notice this Agreement shall terminate but without prejudice to the right and remedies of either party against the other in respect of any antecedent claim or breach of any of the covenants restrictions stipulations or conditions herein contained. The Tenant acknowledges that in the vent of this Agreement being terminated pursuant to this Clause, the Tenant shall have no claim against the Landlord for such early termination. “Demolish” and/or “rebuild” for the purposes of this Clause shall mean the demolition and/or rebuilding of the whole of the said Building or a substantial part or parts (but not necessarily a major part) thereof whether or not including any main walls exterior walls or roof of the said premises and whether or not any part thereof is to be re-built or reconstructed in the same or any other manner. “Refurbish” may or may not include demolition of the said Building or any part thereof.

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Landlord not liable for systems breakdowns	4.18	The Landlord shall not in any circumstances be liable to the Tenant for any defect in or breakdown of the lifts escalators or air-conditioning system condenser water supply system (if any) electric power and water supplies nor shall the rent or air-conditioning and management charges abate or cease to be payable on account thereof.
Common Area	4.19	The Landlord shall have the full right and liberty to partition and/or let to any person any part or parts of the said Building at any time intended for common use and to adjust or redefine the same as the Landlord may in its sole discretion decide without incurring any liability to the Tenant on any account whatsoever so long as all acts or works of the Landlord done or performed pursuant to its rights under this clause comply with all laws and regulations for the time being in force in Hong Kong.
Sale by Landlord	4.20	If the Landlord shall at any time assign the said premises to a purchaser of the Landlord, then the Deposit held by the Landlord hereunder (less any sum which the Landlord is entitled to deduct pursuant to the terms hereof) shall automatically be transferred to the purchaser The Tenant hereby agrees that upon such transfer the Landlord shall be absolutely discharged from its obligations hereunder to refund the Deposit or any part thereof to the Tenant and the Tenant hereby further agrees to waive all the Tenant’s rights and claims hereunder against the Landlord in respect of the Deposit or any part thereof upon such transfer being made as aforesaid.
Handover Condition	4.21	(a)  The Tenant hereby declares and confirms that it has duly inspected the said premises and is satisfied with the current state and condition of the said premises and the provisions, fixtures, fittings, finishes, installations and appliances therein (including without limitation, the ventilation and air-conditioning system, the fire service system and its sprinkler heads distribution water and drainage systems (if any) and electrical and wiring system installed therein). The parties hereto agree that the said premises will be let to the Tenant by the Landlord on an “as-is” basis and in the state and condition as at the date of the handover of the said premises to the Tenant and no warranty or representation is made by the Landlord or its agents regarding:

(i)	the furniture, fixtures, fittings and finishes or the installations and appliances in the said premises and/or the said Building;
(ii)	the state and condition of the said premises or the Building and the user thereof; and
(iii)	the composition of the said Building.

(b)  For the avoidance of doubt, the Landlord does not warrant that the ventilation and air-conditioning system (including the fan coil units), the fire services system (including the sprinkler heads

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		distribution), the water and drainage systems (if any), and the electrical and wiring system installed in the said premises will comply with all or any applicable statutes, codes, ordinances, regulations or requirements of the relevant Government or other competent authorities or whether the same are suitable or sufficient for the Tenant’s intended purpose. Without prejudice to the provisions of Clauses 2.05.01, 2.05.02, and 2.06 hereof, if the Tenant shall require any alteration, additions or improvement to the said systems, any such alteration, additions and improvement shall be made at the Tenant’s own costs and expenses and subject to the Landlord’s prior written consent.
Bank Consent	4.22	This agreement shall be subject to the obtaining by the Landlord from the bank(s) to which the said premises are presently mortgaged to, the bank’s consent for the entering into this Agreement by the parties hereto. If the Landlord should fail or be unable for whatever reason to obtain the bank’s consent as aforesaid, this Agreement shall terminate upon expiration of fourteen (14) days from the day of a notice sent by the Landlord to the Tenant informing the Tenant of the Landlord’s failure to obtain the said consent. In the event of this Agreement being terminated pursuant to this provision, the Tenant shall deliver up vacant possession of the said premises to the Landlord upon expiration of fourteen (14) days from the date of the said notice and the Landlord shall upon the Tenant yielding up the said premises return the Deposit to the Tenant without compensation costs or interest and without prejudice to the Landlord’s right to deduct from the amount of the Deposit and to claim from the Tenant any damages the Landlord have suffered or will suffer as a result of any antecedent breach of this Agreement by the Tenant including but not limited to any failure of the Tenant to pay any sum(s) due under this Agreement prior and up to the date of termination of this Agreement. The Tenant acknowledges that in the event of this Agreement being terminated by reason of the failure of the Landlord to obtain the relevant consent from the bank, the Tenant shall have no claim against the Landlord for such earlier termination.
Stamp Duty	4.23	All stamp duty and registration fee (if any) payable on this Agreement and other disbursements of and incidental to the preparation and execution of this Agreement shall be borne by the parties hereto in equal shares.
Costs	4.24	If both the Landlord and the Tenant engage the Landlord’s solicitors, legal costs of and incidental to the preparation and execution of this Agreement shall be borne by the parties hereto in equal shares. If the Tenant instructs its own solicitors, each party shall bear its own legal costs.
Interpretation	4.25	(i)   Unless the context otherwise requires, words herein importing the masculine gender shall include the feminine and neuter gender and words herein in the singular shall include the plural and vice versa.

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		(ii)  References to Clauses, Sub-clauses and Schedules are to Clauses Sub-clauses of and Schedules to this Agreement. Marginal notes and the index (if any) are inserted for convenience of reference only and shall not affect the interpretation of this Agreement.
		(iii)  The expression “the Tenant” shall (where the context permits) mean and include the party or parties specifically named and its or their successors in title and permitted assigns.
Joint and several liability	4.26	If the Tenant consists of two or more persons, each covenant or agreement on the part of the Tenant herein shall be deemed to have been given by them jointly and severally.
Entire Agreement	4.27	This Agreement sets forth the entire agreement between the parties and supersedes any prior discussions, agreements or arrangements, written or verbal, between the parties relating to the letting of the said premises.

AS WITNESS the hands of the parties hereto the day and year first above written.

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THE FIRST SCHEDULE ABOVE REFERRED TO

PART I

LANDLORD	:	GILROY COMPANY LIMITED whose registered office is situate at 11th Floor, Lai Sun Commercial Centre, No. 680 Cheung Sha Wan Road, Shamshuipo, Kowloon, Hong Kong.
TENANT	:	MARKETSHARE LIMITED whose registered office is situate at Room 1101, 11th Floor, Beautiful Group Tower, 77 Connaught Road Central, Hong Kong. (Company No. 954680) (Business Registration No. 35402855-000-03-07A)

PART II

(the said premises)

ALL THOSE UNITS NO. 1803 AND 1804 on the EIGHTEENTH FLOOR of CAUSEWAY BAY PLAZA 2, No. 463-483 Lockhart Road, Hong Kong erected on All Those pieces or parcels of ground registered in the Land Registry as The Remaining Portion of Section D of Inland Lot No. 2833, The Remaining Portion of Section E of Inland No. 2833, Section J of Inland Lot No. 2833, The Remaining Portion of Section K of Inland Lot No. 2833, The Remaining Portion of Section L of Inland Lot No. 2833, The Remaining Portion of Section M of Inland Lot No. 2833, The Remaining Portion of Section O of Inland Lot No. 2833, The Remaining Portion of Section G of Inland Lot No. 2833, The Remaining Portion of Section H of Inland Lot No. 2833, Sub-Section 4 of Section H of Inland Lot No. 2833 and The Remaining Portion of Inland Lot No. 2833 (“the Land”) which said Units are for the purpose of identification only shown and coloured Pink on the floor plan annexed hereto.

PART III

TERM: For the term of THREE YEARS commencing from the 1^st day of March 2007 (“the Commencement Date”) and expiring on the 28^th day of February 2010 (both days inclusive).

PART IV

Business Name in the said premises

BUSINESS NAME: Marketshare Limited

PART V

Amount of Deposit

Deposit: HONG KONG DOLLARS TWO HUNDRED TWENTY ONE THOUSAND EIGHT HUNDRED AND FIFTEEN AND CENTS FITY ONLY (HK$221,815.50)

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ART VI

User

User: For the Tenant’s lawful business as an office only.

THE SECOND SCHEDULE ABOVE REFERRED TO

PART I

Particulars of Rent

Rent: (I)  The rent for the said term shall be HONG KONG DOLLARS FIFTY NINE THOUSAND AND SEVENTY ONLY (HK$59,070.00) per calendar month exclusive of rates, government rent, air-conditioning and management charges and other outgoings and payable in advance without any deductions on the first day of each and every calendar month the first of such payment to be made on the signing hereof.

(II)  Rent Free Period: No rent will be charged for two (2) months commencing from the Commencement Date and expiring on 30^th April 2007. During the Rent Free Period, the Tenant shall pay the rates, government rent (if any), air-conditioning and management charges and all other outgoings in respect of the said premises.

PART II

Particulars of Air-Conditioning and Management Fee

1.	Air-Conditioning and Management Charges: HK$12,969.00 per calendar month payable monthly in advance without any deductions on the first day of each and every calendar month the first of such payment to be made on the signing hereof.
2.	(a)	The Landlord shall, where the said premises are to be used as a shop only provide and maintain air-conditioning at all times during the normal business hours specified in paragraph (a) of Part II of the Third Schedule hereto and, where the said premises are to be used as an office only during the normal business hours specified in paragraph (b) of Part II of the Third Schedule hereto and, where the said premises are to be used as a restaurant only, during the normal business hours specified in paragraph (c) of Part II of the Third Schedule hereto and without prejudice to the provisions of Clause 4.18 the Landlord shall not be liable to the Tenant nor shall the Tenant have any claim against the Landlord in respect of any interruption in any of the services hereinbefore mentioned by reason of the necessary repair or maintenance of any installations or apparatus or damage thereto or destruction thereof by fire water act of God or other cause beyond the Landlord’s control or by reason of mechanical or other defect or breakdown or faults or other inclement conditions or unavoidable shortage of fuel material water or labour or any act omission or negligence of any attendants watchmen or other servants of the Landlord in or about the performance or purported

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performance of any duty relating to the provision of the said service by any of them or by reason of the cessation of the Tenant’s business. Furthermore, no air-conditioning will be provided if the No. 8 typhoon signal or above is hoisted but the air-conditioning and management charges shall not be abated by reason thereof.

(b)

If the Tenant shall require additional air-conditioning services outside the normal business hours mentioned above, the Tenant shall give to the Landlord not less than 7 days’ notice in writing stipulating at what times the Tenant shall require additional air-conditioning. All costs and expenses so incurred shall be on Tenant’s account payable at such rate as may be determined by the Landlord and subject to variation from time to time at the Landlord’s discretion Provided that a minimum of two hours’ charges shall be paid by the Tenant each time the said premises shall receive such additional air-conditioning services.

PART III

Particulars of Rates and Government Rent

Rates: HK $5,698.50 (or such amount as assessed by the Government) per quarter payable quarterly in advance without any deductions on the first day of the months of January, April, July and October.

PART IV

Amount of Vetting Fee

Vetting Fee: HK$2,686.50

PART V

Amount of Sundry Expenses Deposit during Fitting Out Work

Sundry Expenses Deposit: HK$2,000.00

PART VI

Amount to defray the Sundry Expenses during Fitting Out Work

Amount to defray Sundry Expenses: HK$3,000.00

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THE THIRD SCHEDULE ABOVE REFERRED TO

PART I

The normal business hours of the said Building are:

(a) where the said premises are to be used as a shop only, between the hours of 10:00 a.m. and 10:00 p.m. everyday.

(b) where the said premises are to be used as an office only, between the hours of 09:00 a.m. and 06:00 p.m. every weekday (Monday — Friday) and between the hours of 09:00 a.m. and 01:00 p.m. every Saturday.

(c) where the said premises are to be used as a restaurant only, between the hours of 10:00 a.m. and 12:00 mid-night everyday.

The Landlord reserves the right to alter or amend the said business hours from time to time and to such extent as the Landlord shall in its discretion deem appropriate or necessary.

PART II

The normal hours when air-conditioning services will be supplied are:

(a) where the said premises are to be used as a shop only, between the hours of 10:00 a.m. and 10:00 p.m. everyday.

(b) where the said premises are to be used as an office only, between the hours of 09:00 a.m. and 06:00 p.m. every weekday (Monday — Friday) and between the hours of 09:00 a.m. and 01:00 p.m. every Saturday.

(c) where the said premises are to be used as a restaurant only, between the hours of 10:00 a.m. and 12:00 mid-night everyday.

The Landlord reserves the right to alter or amend the said supply hours from time to time and to such extent as the Landlord shall in its discretion deem appropriate or necessary.

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SIGNED by Mr. Lau Shu Yan, Julius and Mr. Tam Kin Man, Kraven	)
	)	For and on behalf of
for and on behalf of the Landlord	)	GILROY COMPANY LIMITED
	)
whose signature(s) is/are verified by:-	)	/s/ Lau Shu Yan, Julius             Tam Kin Man, Kraven
		Authorized Signature(s)
/s/ Yeung Chi Keung
Yeung Chi Keung
Solicitor, Hong Kong SAR
Vincent T.K. Cheung, Yap & Co.

SIGNED by Mr. Anthony Peter Venus	)	For and on behalf of
	)
for and on behalf of the Tenant in	)	Marketshare Limited
	)
the presence of:-	)	/s/ Anthony Peter Venus
		Authorized Signature(s)
/s/ [Illegible]
Signature of Witness
[Illegible]
Name of Witness
94, BLK 7, [Illegible] Lai Chi Kok
Address of Witness
Manager
Occupation of Witness

     RECEIVED on or prior to the day and year first above written of and from the Tenant the sum of HONG KONG DOLLARS TWO HUNDRED TWENTY ONE THOUSAND EIGHT HUNDRED AND FIFTEEN AND CENTS FIFTY ONLY (HK$221,815.50) being the deposit money above mentioned to be paid by the Tenant to the Landlord.

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For and on behalf of
GILROY COMPANY LIMITED
 

/s/ Lau Shu Yan, Julius                Tam Kin [Illegible]  

Authorized Signature(s) 

The Landlord 

30

[18^th FLOOR PLAN REDACTED]

31

Dated the 28th day of May 2007

GILROY COMPANY LIMITED

and

MARKETSHARE LIMITED

*************************************

TENANCY AGREEMENT

of

All Those Units Nos. 1803 and 1804 on the 18th
FLOOR of CAUSEWAY BAY PLAZA 2, No.
463-483 Lockhart Road, Hong Kong

************************************

VINCENT T.K. CHEUNG, YAP & CO.
SOLICITORS & NOTARIES
15/F., ALEXANDRA HOUSE
18 CHATER ROAD
HONG KONG SAR.

CAB-TA(8/18/2001)(office)

Ref: VC/FL/NY/YMC/07000375

EX-10.6.28

Exhibit 10.6.28

Dated the 14th day of December 2007

GILROY COMPANY LIMITED

and

MARKETSHARE LIMITED

********************************************

TENANCY AGREEMENT

of

All That UNIT NO. 1802 on the 18^TH FLOOR of
CAUSEWAY BAY PLAZA 2, No. 463-483 Lockhart
Road, Hong Kong

********************************************

VINCENT T.K. CHEUNG, YAP & CO.
Solicitors & Notaries
15^th Floor, Alexandra House,
No. 18 Chater Road, Hong Kong,

(Ref. VC/NY/07002836)
[NY/TA/Causeway Bay Plaza 2/072836 (Unit 1802)(Offices)]

CWB-TA(8/8/2001)(office) LS-CSB.ta

AN AGREEMENT made this 14th day of December Two thousand and seven

BETWEEN the company detailed as the Landlord in Part I of the First Schedule hereto (hereinafter called “the Landlord” which expression shall where the context admits include its successors and assigns) of the one part and the person firm or company detailed as the Tenant in Part I of the First Schedule hereto (hereinafter called “the Tenant”) of the other part.

WHEREBY IT IS AGREED as follows:

Premises	(1)	The Landlord shall let and the Tenant shall take ALL THOSE premises (hereinafter referred to as “the said premises”) forming part of all that building (hereinafter referred to as “the said Building”) which said premises and Building are more particularly described and set out in Part II of the First Schedule hereto TOGETHER with the use in common with the Landlord and all others having the like right of all entrances, staircases, landings, corridors, passages and lavatories and all the lifts, escalators and central air-conditioning services in the said Building (if and whenever the same shall be operating) in so far as the same are necessary for the proper use and enjoyment of the said premises and except in so far as the Landlord may from time to time restrict such use for the term set out in Part III of the First Schedule hereto (hereinafter referred to as “the said term”) Yielding and Paying therefore throughout the said term the rent and other charges as are from time to time payable in accordance with the provisions set out in Part I, Part II and Part III of the Second Schedule hereto.
	(2)	The Tenant to the intent that the obligations hereunder shall continue throughout the said term hereby agrees with the Landlord as follows:
Rent	2.01	To pay the rent on the days and in the manner set out in Part I of the Second Schedule hereto by auto-pay into a bank account designated by the Landlord or by other means as the Landlord may from time to time direct.
Air-conditioning charges and management fees	2.02	To pay the air-conditioning and management charges on the days and in the manner set out in Part II of the Second Schedule hereto by auto- pay into a bank account designated by the Landlord or by other means as the Landlord may from time to time direct Provided that the Landlord shall be entitled at any time and from time to time during the said term to serve a notice upon the Tenant increasing the air-conditioning and management charges by an amount or amounts which the Landlord shall deem appropriate and thereafter such increased charges shall be payable in lieu of the charges provided for in Part II of the Second Schedule.
Rates and Government Rent	2.03	To pay and discharge all rates, government rent, taxes, assessments, charges, duties, impositions, and outgoings whatsoever now or hereafter to be levied or imposed upon the said premises or upon the owner or occupier thereof by the Government of the Hong Kong Special Administrative Region (“the Hong Kong Government”) or other lawful authorities (Property Tax only excepted). Without prejudice to the

		generality of this Clause the Tenant shall pay all rates and government rent imposed on the said premises in manner set out in Part III of the Second Schedule hereto in the first place to the Landlord who shall settle the same with the Hong Kong Government and in the event of the said premises not having been assessed to rates or government rent by the Hong Kong Government the Tenant shall pay to the Landlord such sums as shall be required by the Landlord as a deposit by way of security for the due payment of rates and government rent subject to adjustment on the actual assessment of rates and/or government rent being received from the Hong Kong Government.
Utility charges and Deposits	2.04	To pay and discharge all deposits and charges in respect of water electricity telephone and other utilities as may be shown by or operated from the Tenant’s own metered supply or by accounts rendered to the Tenant in respect of all such utilities consumed on or in the said premises.
Interior Fitting Out	2.05.01	To fit out the interior of the said premises in accordance with the plans drawings and specifications as shall have been first submitted to and approved by the Landlord or (if required) the manager of the said Building (“the Manager”) in writing in good proper and workmanlike manner using good quality materials and in all respects in a style and manner appropriate to a first class office building/shopping centre. Without limitation to the generality of the foregoing, the Tenant shall at its own expense:

 (i) construct furnish or install within the said premises the following items:

(a)	a ceiling of non-combustible material;
(b)	such fire extinguishers or other fire-fighting equipment as may be required from time to time by the laws of the Hong Kong Special Administrative Region (hereinafter referred to as “Hong Kong”) including the provision of sprinkler heads and/or smoke detectors;
(c)	vertical window blinds, tracks and fittings;
(d)	floor tiles and floor finishes (PVC tiles shall not be used unless approved by the Landlord);
(e)	all utilities such as gas and telephone as well as other requirements of the Tenant together with such meters as are necessary to measure the Tenant’s consumption thereof;
(f)	all lighting fixtures including lamps, switches and wiring;

(ii)	paint and decorate the interior of the said premises;
(iii)	complete all electrical and mechanical installations (including heating, ventilation, air-conditioning, plumbing, drainage and fire services and wiring from the said premises to the meter room and connection of the ventilation and air-conditioning system

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and the fire services installed in the said premises to the Landlord’s main system including the installation of fan coil units and sprinkler heads distribution thereto).

Tenant’s Plans 2.05.02   (i) Prior to the commencement of the fitting out work referred to in Clause 2.05.01 above (“the Fitting Out Work”) the Tenant shall at its own costs and expense prepare and submit to the Landlord for approval plans, drawings and specifications in such details as the Landlord may require in respect of the Fitting Out Work (“the Tenant’s Plans”) which shall include, without limitation, the following:

(a)	5 sets of ceiling plan showing partition that penetrate into the ceiling void and details of works inside the ceiling void, exact location of light fittings and thermostat control units and proposed relocation, proposed modification to main ceiling trunking system together with schedule on voltage, type, wattage and quantity;
(b)	5 sets of floor plan showing details of partitions, area of raised flooring and location of heavy equipment;
(c)	5 sets of electrical layout plan for all case work including the location of all sockets, switches, fuse box and telephone points;
(d)	5 sets of elevation plan showing design of shopfront/showcase or if an office, its main entrance with details of electric outlets;
(e)	5 sets of fire services layout plan showing location of existing sprinkler heads and any proposed relocation or addition, location and arrangement of smoke detective system and BTM system if any;
(f)	5 sets of air-conditioning layout plan showing changes to existing installations, location of thermostats and access panels with schedule of fan coils units and tee-off valves etc;

(iv) The Tenant’s Plans shall be submitted to the Landlord for approval in any event within 14 days of the signing of this Agreement. The Landlord may accept reject or modify the Tenant’s Plans or any part thereof and shall notify the Tenant of the same within 14 days after submission of such plans by the Tenant. For the avoidance of doubt, it is hereby expressly agreed that rent shall be payable from the expiry of the rent-free period set out in Part I of the Second Schedule notwithstanding that the Tenant’s plans have not yet been submitted to, or have not yet been approved by the Landlord.

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(v)

The Tenant shall commence the Fitting Out Work within 30 days of the notice from the Landlord accepting or modifying the Tenant’s Plans (as the case may be) which work shall be completed within the time specified by the Landlord in the said notice.

(vi)

All mechanical and electrical engineering work relating to the said premises and all decoration work within the said premises shall be carried out and performed by contractors or sub-contractors approved by the Landlord and all other works and arrangements related to the said premises including but not confined to plumbing and fire-fighting installation shall be carried out by contractors or sub-contractors nominated by the Landlord all at the Tenant’s costs and expense and at such time and hour as may be specified by the Landlord.

Vetting Fee		2.05.03		The Tenant shall pay to the Landlord a vetting fee in the sum as set out in Part IV of the Second Schedule hereto in respect of the costs charged by the Landlord’s consultant for approving the Tenant’s Plans and any modifications or amendments thereto and for supervising the Fitting Out Work.
Inspection by Landlord		2.05.04	(i)	The Fitting Out Work shall be subject to the inspection and supervision of the Landlord, the Landlord’s Architect and the Landlord’s General Contractor from time to time during the period in which the said work is being performed.
Reimbursement to Landlord	(ii)			The Landlord shall have the right to perform on behalf of and for the account of the Tenant any of the Fitting Out Work which the Landlord determines shall be so performed. Such work shall be limited to work caused by the Tenant’s fault, and work which pertains to structural components, the general utility systems for the said Building and the erection of temporary safety barricades and temporary signs during construction.
Sundry expenses during fitting out period		2.05.05	(i)	The Tenant shall pay to the Landlord such charges in respect of the supply of temporary electricity to the said premises as the Landlord may decide together with the installation costs for such supply and other sundry expenses incurred by the Landlord by reason of the Tenant’s Fitting Out Work being carried out on the said premises and the Landlord may deduct such sums from the deposits mentioned in Clause 2.05.05(ii) below.
	(ii)			The Tenant shall at the signing of this Agreement deposit with the Landlord (a) a sum as set out in Part V of the Second Schedule hereto to secure the due performance and observance of the Tenant’s obligations under this Clause 2.05 and (b) a further sum as set out in Part VI of the Second Schedule hereto to defray the aforesaid sundry expenses and temporary electricity charges which sums shall, subject to any deduction that the

4

Landlord is entitled to make under this Agreement, be refunded to the Tenant without interest within 30 working days after the completion of the Fitting Out Work.

Statutes, Codes & Ordinance	2.06	The Tenant shall have the sole responsibility to comply with all applicable statutes, codes, ordinances and regulations for all works performed by or on behalf of the Tenant within the said premises and approval by the Landlord or the Landlord’s agent of plans, specifications, calculations or otherwise of any works shall not constitute any implication, representation or certification by the Landlord that such works are in compliance with any statutes, codes, ordinances or regulations.
Contractors’ Insurance	2.07	The Tenant shall procure that any contractors engaged by the Tenant to carry out any works relating to the said premises effect third party liability insurance in such sum as the Landlord may require and that the relevant insurance policy be produced to the Landlord as and when so required by the Landlord. The Landlord will not otherwise permit any works to be carried out by such contractors.
Telephone System	2.08	To install at the Tenant’s own expense empty conduits for telephone service to the said premises. Telephone service to the said premises shall only be installed by PCCW-HKT Limited or other licensed telephone company and the Tenant shall pay to the Landlord the expenses incurred in the installation of telephone jacks and conduits to the said premises.
Pass for Services	2.09	To permit permanent utility lines including but not limited to drains, gas and water pipes and electricity and other wires to pass through the said premises to service other premises and areas in the said Building and to permit the Landlord and all persons authorised by it to enter the said premises to carry out any works repairs or maintenance which require to be done.
Design Loads	2.10	(i)	Loading imposed by any of the Tenant’s work on a temporary or permanent basis shall not exceed the designed live load.

(ii)	The Landlord shall be entitled to prescribe the maximum weight and permitted location of safes and other heavy equipment and to require that the same shall stand on supports of such dimensions and materials to distribute the weight as the Landlord may deem necessary.
(iii)	Except for suspended ceilings and duct work, the Tenant shall not support any equipment, partitions or other work on or from the Landlord’s walls, structure or roof deck without the Landlord’s prior approval in writing.

Floor Load (iv) The Tenant shall not put or permit to be put any equipment, goods, stocks or things whatsoever on the said premises the load of which exceeds the designed live load of the premises under the Building Ordinance.

5

Installation & Alteration	2.11 (i)	Not without prior written consent of the Landlord to make or permit any alteration or addition to the said premises or any part thereof either internally or externally or to any fixtures or fittings or electrical wiring or electrical mechanical or ventilation and air-conditioning installations or fire services system or any other system or facilities therein or to any item therein or any other equipment machinery appliances or anything whatsoever (whether or not of a structural nature). Upon determination of this Agreement the Tenant shall at his own expense remove all decoration or partitions so erected or installed by the Tenant and restore the said premises to its original state upon being required so to do by the Landlord.
	(ii)	The Tenant shall employ at his own costs and expense the Landlord’s nominated contractor or consultant for the purpose of carrying out any of the permitted alterations additions or improvements (except for mechanical and electrical work and decoration work within the said premises which may be carried out by contractors approved by the Landlord).
	(iii)	To observe and comply with all rules regulations and instructions from time to time prescribed by the Landlord or its authorised representative or officer in carrying out any permitted alterations additions or improvements to the said premises.
	(iv)	The Tenant shall have the sole responsibility to observe and comply with all applicable statutes, codes, ordinances and regulations for all works performed or to be performed by or on behalf of the Tenant and approval by the Landlord of any plans or specifications or otherwise shall not constitute or be deemed to constitute any implication representation or warranty that the said works are in compliance with any statutes, codes, ordinances or regulations.
	(v)	To observe and comply with all rules regulations and instructions from time to time prescribed by The Hongkong Electric Company Limited or the relevant authority relating to the electrical wiring and installation in the said premises.
	(vi)	All fees and expenses incurred by the Landlord in connection with the giving of consents under this Clause shall be borne by the Tenant.

Injury to main walls ceilings, floors, doors and windows 2.12 Not to cut maim injure damage alter or interfere with any of the doors windows walls structural members pipes drains appurtenances electrical cables wires fixtures or fittings of or in the said premises or any part thereof or suffer or permit the same to be done.

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Compliance with ordinances 2.13 To comply with all ordinances regulations by-laws, and all notices and requirements of the appropriate Government or other competent authorities or the Manager in connection with or in relation to the use of the said premises and to keep the Landlord indemnified against all proceedings actions claims demands and liabilities in respect thereof and all costs and expenses incurred by the Landlord thereon and upon receipt of any such notice concerning or in respect of the said premises as aforesaid forthwith to deliver to the Landlord a copy of such notice.

Good repair of Interior	2.14	(i)	To keep all the interior and/or non-structural parts of the said premises including the flooring and interior plaster or other finishing material or rendering to walls and all ceilings and the Landlord’s fixtures therein and all additions thereto and the doors, windows, ventilation and air-conditioning system, fire-fighting equipment, electrical installations, wiring, fan coil units, thermostat control and sprinkler heads thereof (whether or not the same is installed by the Tenant) in good, clean and tenantable repair and condition and as may be appropriate from time to time properly painted and decorated so as to maintain the same at the sole expense of the Tenant throughout the said term and to yield up the same in such repair and condition at the end or sooner determination of the said term.
		(ii)	To observe and comply with all rules regulations and instructions from time to time prescribed by the electricity supply company and/or the relevant authority relating to the electrical wiring and installation in the said premises and to repair or replace all electrical wiring installations and fittings within the said premises and the wiring from the Tenant’s meter(s) to and within the same whenever required by the supply company, statutory undertaker or other competent authority.
		(iii)	To indemnify the Landlord against all costs, claims, demands, actions, liabilities and legal proceedings whatsoever made upon the Landlord by any person in respect of any breach of this covenant.
Grease Trap (if applicable)	2.15	To install its own grease trap(s) in order to comply with the relevant Government regulations for the operation of a restaurant and to keep any grease trap serving the said premises in good clean and proper repair and condition at all times during the said term to the satisfaction of the Landlord and in accordance with the regulations of the Government authorities concerned.
Good repairs & replacement of sanitary apparatus	2.16	(i)	To keep all taps lavatories wash basins sinks sanitary and water apparatus and other pipes and all drains (if any) located within the said premises (and such lavatories and water apparatus as are located elsewhere in the said Building and used exclusively by the Tenant and/or its servants agents and licensees) in clean and tenantable state and in proper repair and condition at all times during the said term to the satisfaction of the Landlord and in accordance with the regulations of the Government Authority concerned.

7

Toilet Facilities		(ii)	To use in common with others the lavatories and washing accommodations and facilities provided by the Landlord in the said Building and not to permit or suffer the same to be used in any improper manner or whereby the soil or waste pipes may become impeded or blocked and at all times to indemnify the Landlord against liability for loss damage or injury by the escape of water caused to the property or the tenants or occupiers of any other part(s) of the said Building.
Replacement of Doors & Window Glass	2.17	To replace at the Tenant’s expense all broken or damaged windows doors glass and fixtures whether the same shall have been broken or damaged by the negligence of the Tenant or owing to circumstances beyond the control of the Tenant.
Cleansing & Clearing of Drains	2.18	In the event of the pipes or drains of the said Building becoming choked or stopped up owing to the careless use by the Tenant its servants agents licensees invitees the Tenant shall pay the costs incurred by the Landlord in cleansing and clearing the same.
Indemnity against loss/damage from Interior Defects	2.19	To be responsible for and to fully and effectually indemnify the Landlord from and against any proceedings actions claims and demands whatsoever by any person for any loss damage or injury caused to or suffered by any person whomsoever or any property whatsoever including any loss of business or profit as a result of or otherwise arising from the want of repair of the said premises or any fixtures or fittings therein the repair of which the Tenant is responsible hereunder or the spread of fire or smoke or the overflow of water or the escape of any substance or anything from the said premises and against all costs and expenses of the Landlord incurred in respect of any such proceedings action claim or demand.
Insurance	2.20	(i)	To effect and maintain during the said term insurance cover in respect of the risks mentioned in Clause 2.19 above and such other risks as the Landlord may deem appropriate. The policy of insurance shall be effected with an insurance company approved by the Landlord for a coverage of not less than HK$5,000,000.00 for any one claim or in such amount as the Landlord may determine and which policy shall be endorsed to show the Landlord as the registered owner of the said premises and shall contain a Clause to the effect that the insurance cover thereby effected and the terms and conditions thereof shall not be cancelled modified or restricted without the prior written consent of the Landlord. The Tenant undertakes to produce to the Landlord as and when required by the Landlord such policy of insurance together with the receipt for the last payment of premium and a certificate from the relevant insurance company that the policy is fully paid up and in all respects valid and subsisting on request Provided always that if the Tenant shall at

8

		any time fail to keep such insurance in force the Landlord may do all things necessary to effect and maintain in force such insurance and any monies expended by the Landlord for that purpose shall be recoverable from the Tenant on demand.
Insurance Policy	(ii)	Not to do or permit to be done anything whereby the policy or policies of insurance of the said Building against damage by fire or other perils for the time being subsisting may become void or voidable or whereby the rate of premium thereon may be increased and without prejudice to any other rights and/or remedies the Landlord may have hereunder all expenses incurred by the Landlord in or about any renewal of such policy or policies or any increased premium rendered necessary or payable by a breach of this term shall be borne by the Tenant and shall be recoverable from the Tenant by the Landlord on demand.

Protection against storm or typhoon	2.21	To take all necessary precautions to protect the said premises against damage by storm or typhoon rainfall or the like.
Entry by the Landlord to view the premises	2.22	To allow and permit the Landlord and/or the Manager and/or their respective authorised agents to enter upon the said premises at all reasonable times to see and inspect that no alteration has been made to the said premises or the fixtures or fittings therein and that all work is carried out in accordance with the plans approved by the Landlord and that the interior of the said premises is properly repaired and maintained.
Entry by the Landlord to carry out repairs and take inventories	2.23	To permit the Landlord and/or the Manager and/or their respective authorised agents at all reasonable times to enter the said premises for the purposes of taking inventories of the Landlord’s fixtures therein and carrying out any works repairs or maintenance which require to be done provided that in the event of emergency the Landlord or its authorised agents may without notice enter the said premises forcibly and the Tenant shall at its own expense reinstate the entrance to the said premises to its original state.
Carry out repairs or receipt of notice to effect the same	2.24	On receipt of any notice from the Landlord or its authorized representatives specifying any works or repairs which require to be done and which are the responsibility of the Tenant hereunder, forthwith to put in hand and execute the same with all possible despatch and without any delay. If the Tenant fails to do so the Landlord or its servants or agents shall be entitled, without prejudice to the Landlord’s right of re-entry under the provisions hereinafter contained, to enter upon the said premises and forcibly if need be to carry out any such works or repairs at the sole expense of the Tenant.
Entry by the Landlord to close windows and doors	2.25	To keep all windows and doors of the said premises closed and to permit the Landlord or its servants and agents and others from time to time during the said term to enter upon the said premises for the purpose of closing any doors or windows.

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Notify Landlord of damage	2.26	To notify the Landlord in writing or by other reasonable means of any accidents or damage to or defects in the water pipes gas pipes electrical wire or fittings fixtures or other facilities provided by the Landlord in the said premises whether or not the Tenant is liable hereunder for the repair of the same forthwith upon the same arising and to indemnify the Landlord against any claim made against the Landlord by any third party and any loss suffered by the Landlord either directly or indirectly as a result of any breach by the Tenant of this provision.
To make good & take care of all articles provided by Landlord	2.27	To make good and pay for all damage caused by the Tenant its servants or licensees to any fixtures, fittings (including the ventilation and air- conditioning system and fire services system) and other articles in the said premises and provided by the Landlord and shall take reasonable care of the same and shall not remove any of them from the said premises.
Cleaning Contractors	2.28	To employ at the expense of the Tenant only such cleaners as may be nominated by the Landlord for the cleaning of the said premises.

Removal of garbage	2.29	(i)	To be responsible (at its own expense) for the removal of garbage and refuse from the said premises to such location as shall be specified by the Landlord or its agents from time to time and to use only that type of refuse container as is specified by the Landlord or its agents from time to time.
		(ii)	In the event of the Landlord providing a collection service for refuse and garbage the same shall be used by the Tenant to the exclusion of any other similar service and the use of such service provided by the Landlord shall be at the sole cost of the Tenant.

Re-letting Notice	2.30	To permit the Landlord during the three (3) months immediately preceding the termination of the said term to affix and retain without interference on any part of the said premises a notice for re-letting the same and during such period to permit persons with written authority of the Landlord or its agents at reasonable times of the day to view the said premises.
Lifts & Escalators	2.31	Not to place or take in the passenger lifts or escalators any bulky baggage parcels sacks bags equipments or other goods.
Animals, Pets & Pest Control	2.32	Not to keep or permit or suffer to be kept upon any part of the said premises any livestock or animals and to carry out such pest control for the said premises upon request of the Landlord by pest control companies nominated by the Landlord at the Tenant’s expense.
Preparation of food	2.33	Not to prepare or permit or suffer to be prepared any food in the said premises nor to cause or permit any offensive or unusual odours to be produced upon, permeate through or emanate from the said premises.
Offensive Trades	2.34	Not to carry on or to permit or suffer to be carried on in or upon the said premises or any part thereof any trade or business which the Landlord shall in its absolute discretion regards as dangerous noxious noisy or offensive.

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Sale by Auction or others	2.35	Not to carry on or to permit or suffer any sale to the public by auction or any other means to take place upon the said premises.
Nuisance or Annoyance	2.36	Not to do or permit or suffer anything in the said premises or in the said Building which is or may be a nuisance or annoyance to the Landlord or any other tenants or occupiers of the said Building or of any adjoining building or affect the reputation of the said Building as a high class commercial building/shopping centre.
Noise	2.37	Not to produce or permit or suffer to be produced any music or noise (including sound produced by broadcasting or any apparatus or equipment capable of producing, reproducing, receiving or recording sound) so as to be audible outside the said premises which may be a nuisance or annoyance to the tenants or occupiers of other premises in the said Building.

Sign and Advertisement	2.38	(i)	Not to affix erect attach exhibit or permit or suffer so to do or to be done upon any part of the said Building or of the exterior of the said premises or to or through any windows thereof any sign signboard notice advertisement placard neon light or other device of any kind whether illuminated or not (hereinafter referred to as “the signboard”) without the prior written approval of the Landlord and the approval of all appropriate government authorities.
		(ii)	To maintain any signboard approved under Clause 2.38(i) above at all times in good repair and condition and to meet all the requirements that may from time to time be imposed by any Government authorities and to dismantle and remove the signboard on the termination of this Agreement or if so required by any Government or competent authority or the Manager and to make good any damage done and to indemnify the Landlord against all loss, damages and liability that may be suffered, paid or incurred by the Landlord by any person whatsoever and any costs and expenses incurred by the Landlord in respect of any such proceedings action claim or demand as a result of or otherwise arising from the installation or any defects in the signboard.
		(iii)	Notwithstanding Clause 2.38(i) above, the Tenant may at its own expense display its name and the nature of its trade or business on the Directory Boards provided by the Landlord on the maindoor of the said premises but only in such form and character as shall be determined or approved in writing by the Landlord in its absolute discretion.
Directory Board	2.39	(i)	The Tenant’s name to appear on the Directory Board and the signboard shall strictly be in accordance with that appearing in Part IV of the First Schedule hereto unless prior written approval to name otherwise has first been obtained from the Landlord.

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(ii)	The Tenant shall if so required by the Landlord sign or execute such agreements or documents as the Landlord may deem appropriate in respect of any change of the Tenant’s name under Clause 2.39(i) above and the Tenant shall be responsible for all costs and expenses incurred thereby including any registration fee payable.
(iii)	To pay the Landlord or its agents immediately upon demand the costs of affixing, repairing, altering or replacing as necessary the Tenant’s name on the Directory Board (if any) provided by the Landlord.

User	2.40	Not to use or permit or suffer the said premises or any part thereof to be used for any purpose other than as set out in Part VI of the First Schedule hereto and without prejudice to the foregoing to obtain any licence approval or permit required by any Government or other competent authority in connection with the Tenant’s business or its use or occupation of the said premises prior to the commencement of the Tenant’s business and to maintain and keep in force such licence approval or permit during the currency of this tenancy and to indemnify the Landlord against the consequences of a breach of this provision and in particular not to use or permit the same to be used for domestic purpose or as sleeping quarters and not to allow any person to remain in the said premises overnight. For the avoidance of doubt, the Landlord does not warrant whether the said premises can be used for any purpose other than that stated in the Occupation Permit of the said Building or whether the said premises are suitable or may be used for the Tenant’s intended purpose.
Business Name	2.41	The name under which the business in the said premises shall be carried on is as set out in Part IV of the First Schedule hereto.
Illegal or Immoral Use	2.42	Not to use or permit or suffer the said premises to be used for the purpose of gambling or for any illegal immoral or improper purpose.
Combustible Dangerous Goods	2.43	Not to keep store use or bring into the said premises or any part thereof any unlicensed arms ammunition or unlawful goods gun-powder spirits or saltpetre kerosene or other explosive or combustible substances or any dangerous goods within the meaning of the Dangerous Goods Ordinance and then only in compliance with all relevant legislation and Government regulations.
Obstructions in Common Area	2.44	Not to place or leave in the entrances landing staircases driveways passages lobbies or any parts of the said Building in common use any box or any thing or things rubbish or otherwise which may incumber or obstruct the same. Without prejudice to the Landlord’s rights and remedies hereunder, the Landlord and the Manager shall be entitled without notice and at the Tenant’s expense to remove and dispose of any

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such material aforesaid as it sees fit and the Landlord and the Manager shall not thereby incur any liability to the Tenant or any other person whosoever and the Tenant shall indemnify the Landlord against all losses damages expenses or liabilities that may be suffered, paid or incurred by and any claims proceedings actions and demands made against the Landlord in respect thereof.

Bulky Deliveries	2.45	Not to take or allow delivery of furniture fixtures or bulky items of goods in and out of the said Building except with the prior written approval of the Landlord and at such times and through such entrances as shall be designated by the Landlord from time to time and to use only the service lifts provided by the Landlord for such purposes.
Breach of Government Lease	2.46	Not to do or suffer any act to be done which shall amount to a breach or non-observance of any covenants and conditions in the Government Lease or Conditions under which the Land (as defined in Part II of the First Schedule hereto) is held from the Government and to indemnify the Landlord against any breach thereof.
Assignment & underletting	2.47	Not to assign underlet or otherwise part with the possession of the said premises or any part thereof in any way whether by way of subletting lending sharing or other means whereby any person or persons not a party to this Agreement obtains the use or possession of the said premises or any part thereof irrespective of whether any rental or other consideration is given for such use or possession and in the event of any such transfer sub-letting sharing assignment or parting with the possession of the said premises (whether for monetary consideration or not) this Agreement shall at the option of the Landlord absolutely determine and the Tenant shall forthwith surrender and vacate the said premises on notice to that effect from the Landlord. The Tenancy shall be personal to the Tenant and without in any way limiting the generality of the foregoing the following acts and events shall, unless approved in writing by the Landlord, be deemed to be breaches of this Clause:

(i)	In the case of a Tenant which is a partnership the taking in of one or more new partners whether on the death or retirement of an existing partner or otherwise.
(ii)	In the case of a Tenant who is an individual (including a sole surviving partner of a partnership Tenant) the death insanity or disability of that individual to the intent that no right to use possess occupy or enjoy the said premises or any part thereof shall vest in the executors administrators personal representatives next of kin trustee or committee of any such individual.
(iii)	In the case of a Tenant which is a corporation any take-over reconstruction amalgamation merger voluntary liquidation or change in the person or persons who owns or own a majority of its voting shares or who otherwise has or have effective control thereof.

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(iv)	The giving by the Tenant of a Power of Attorney or similar authority whereby the donee of the Power obtains the right to use possess occupy or enjoy the said premises or any part thereof or does in fact use possess occupy or enjoy the same.
(v)	The change of the Tenant’s business name without the previous written consent of the Landlord.

Aerials 2.48 Not to affix to the said Building or any part thereof any aerial or similar apparatus without the consent of the Landlord in writing and not to remove dismantle or alter those common aerials (if any) provided by the Landlord.

Fire	2.49	(i)	Compliance with Codes and Regulations for additional fire protection system apart from those provided by the Landlord whether or not induced by the business of the Tenant shall be the responsibility of the Tenant, and the costs so incurred shall be borne by the Tenant.
		(ii)	To ensure at all times that all fire alarms, fire-fighting equipment, roller shutters (if any) and other equipment for security purpose (if any) provided by the Landlord shall not be disrupted, interrupted, damaged or caused to be defective through the act, default or neglect of the Tenant, its servants, agents, licensees or customers.

Yield up premises and handover 2.50 To quietly yield up the said premises together with all fixtures, fittings, and additions therein and thereto at the expiration or sooner determination of this Agreement in good, clean and tenantable repair and condition in accordance with the provisions herein contained notwithstanding any rule of law or equity to the contrary Provided That (i) where the Tenant has made any alteration or improvement or installed any fixtures fittings or additions to the said premises (including the ventilation and air-conditioning system and fire services system therein), whether with or without the Landlord’s consent, the Landlord may in its absolute discretion retain such fixtures, fittings, additions or improvement as the Landlord may wish to retain without any payment to the Tenant whether by way of compensation or otherwise and (ii) if the Landlord shall require the said premises to be delivered up in a bare shell condition or the removal of any additions, alterations, fittings or fixtures, then the Tenant shall at its own cost and expense remove all or such of the additions alterations, fittings or fixtures as so required by the Landlord, whether the same be made or installed by the Tenant, and make good and repair in a good and workmanlike manner all damage caused by such removal to the satisfaction of the Landlord. The Tenant shall further procure a chemical cleaning of all fan coil units in the said premises to the satisfaction of the Landlord upon expiration or sooner determination of this Agreement and thereupon shall surrender to the Landlord all keys giving access to all parts of the said premises and remove at the Tenant’s expense all lettering and characters from all the doors, walls, or windows of the said premises and make good all damage caused by such removal.

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Keeping the said premises open for business	2.51	To keep the said premises open for business at all times of the year during the normal business hours of the said Building namely the hours set forth in Part I of the Third Schedule hereto and without prejudice to the generality of the foregoing any suspension of the Tenant’s business for a period of more than 7 days without the prior consent of the Landlord shall constitute a material breach of this provision entitling the Landlord to determine this Agreement and to regain possession of the said premises.
Tenant liable for acts and omissions of others	2.52	To be answerable and responsible to the Landlord or the acts, neglects, and defaults of omission of all contractors, servants, agents, invitees and licensees of the Tenant as if they were the acts, neglects and default or omission of the Tenant itself and to indemnify the Landlord against all costs claims demands expenses or liability to any third party in connection therewith and for the purposes of this Agreement “licensee” shall include any person present in, using or visiting the said premises with the consent of the Tenant express or implied.
Obey Building Rules	2.53	To obey and comply strictly with the rules and regulations from time to time adopted by the Landlord or the Manager whether relating to the management and security of the Building or otherwise, to furnish first class service to customers and to conduct the business of the Tenant so as not to prejudice the goodwill and reputation of the said Building as a first class commercial building/shopping centre.
Observance to the Deed of Mutual Covenant and Management Agreement	2.54	To observe and comply with and not to permit or suffer anything to be done which may amount to a breach or non-observance by the Landlord of any terms and provisions in the Deed of Mutual Covenant relating to the said Building (“the said Deed of Mutual Covenant”) and/or Management Agreement (if and when the same shall come into operation) and to indemnify the Landlord against the breach non-observance or non-performance thereof. It is also expressly agreed and declared that the Landlord shall have the full right and liberty at any time hereafter to enter into such form of Deed of Mutual Covenant and/or Management Agreement with the owners of the said Building or such other parties as the Landlord shall think fit to define their respective rights and obligations of and in the Land and the said Building and to make provision for the management of the said Building.
No wiring etc. in common areas	2.55	Not to install affix or attach any wiring, cables or other article or thing in or upon any of the entrances, staircases, landings, passageways, lobbies or public areas of the said Building.
No touting	2.56	No to permit any touting or soliciting for business or distributing of any pamphlets, notices or advertising matter to be conducted outside or near the said premises or in any part of the said Building by any of the Tenant’s servants, agents or licensees.

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Not to drive nails etc.	2.57	Not without the consent of the Landlord to drive or insert or permit or suffer to be driven or inserted any nails, screws, hooks, brackets or similar articles into the ceilings, doors, walls, window beams or floor of the said premises.
	2.58	Not to name or include in the name of the business at the said premises the name of the said Building and/or the words “Lai Sun” whether in English or Chinese Characters or any name which the Landlord regards as similar thereto.
Maintain displays (if application)	2.59	To install and at all times maintain displays of merchandise goods or services in any shopfront windows or showcases contained within the entrance ways to the said premises to the satisfaction of the Landlord and to a standard and composition appropriate in the opinion of the Landlord to the reputation and standing of the said Building, and to alter any window or other display of goods or merchandise in or at the said premises immediately upon notice by the Landlord that such displays will in the opinion of the Landlord prejudice the reputation or standing of the said Building.
Keep shopfronts lit (if application)	2.60	The Tenant shall at its own expense keep lit any shopfront windows and showcase together with the shop signs of the said premises during such normal business hours as are specified in paragraph (a) of Part I of the Third Schedule hereto. For the purpose of this Clause shopfront windows shall include those parts of the interior of the said premises used for the display of merchandise goods or services immediately fronting onto the common areas of the said Building.
Not to Obstruct Shopfront Window (if application)	2.61	Not to block or darken or obstruct or obscure the shopfront window or any other window or lights belonging to the said premises without having obtained the written consent of the Landlord which consent may be given subject to such conditions as the Landlord may in its absolute discretion consider fit to impose.
	(3)	THE LANDLORD HEREBY AGREES WITH THE TENANT AS FOLLOWS:
Quiet Enjoyment	3.01	Subject to the Tenant paying the rent and other charges set forth in Clause 2 hereof and any other charges which may become payable by the Tenant under this Agreement and the Tenant observing and performing the terms and covenants contained in this Agreement to permit the Tenant to have quiet possession and enjoyment of the said premises during the said term without any interruption by the Landlord or any one lawfully claiming under or through or in trust for the Landlord.
Property Tax	3.02	To pay all Property Tax on the said premises during the said term.
Roof and Main Structure	3.03	To keep in good condition and proper repair the roof the main structure and external walls of the said Building and the main pipes drains and cables and to do all structural repair required to be done at any time Provided that the Landlord’s ability under this Clause 3.03 shall not arise

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		unless and until written notice of any defect or want of repair has been given by the Tenant to the Landlord and the Landlord shall have failed to take reasonable steps to repair or remedy the same after the lapse of a reasonable time from the date of service of such notice.
	(4)	PROVIDED always and it is hereby expressly agreed and declared by the parties as follows:
Default	4.01	If and whenever the rent hereby reserved or any part thereof shall be in arrear for 15 days whether the same shall have been legally demanded or not or if any term, condition or stipulation on the Tenant’s part herein contained shall not be performed or observed or if the Tenant for the time being shall become bankrupt or enter into any composition or arrangement with the Tenant’s creditors or suffer any distress or execution to be levied on the Tenant’s good or if the Tenant shall suffer any prosecution in respect of the non-payment of money due to Hong Kong Government or if the Tenant for the time being is a company and shall enter into liquidation whether compulsory or voluntary (save for the purpose of reconstruction or amalgamation) or if any petition shall be presented for the winding up of the Tenant then and in any of the said cases it shall be lawful for the Landlord at any time thereafter to re-enter upon the said premises or any part thereof in the name of the whole and forfeit the Deposit (as defined in Clause 4.10 hereof) or such part thereof held by the Landlord and thereupon the tenancy hereby created shall absolutely determine but without prejudice to the right of the Landlord in respect of any breach by the Tenant of any terms, conditions or stipulations herein contained or to the Landlord’s right to deduct all loss and damage thereby incurred from the Deposit and in particular the Landlord shall have the right to terminate or disconnect the supply of air-conditioning water electricity and other facilities to the said premises upon the occurrence of any of the above event of default.
Exercise of Right	4.02	A written notice served by the Landlord on the Tenant in manner hereinafter provided to the effect that the Landlord thereby exercises the power of re-entry herein contained shall be a full and sufficient exercise of such power without actual entry on the part of the Landlord.
Acceptance of Rent	4.03	In the event of any breach of any term stipulations and conditions on the part of the Tenant herein contained the Landlord shall not by acceptance of rent or by any other act whatsoever or by any omission be deemed to have waived any such breach notwithstanding any rule of law or equity to the contrary and that no consent to or waiver of any breach shall be binding on the Landlord unless the same is in writing under the hand of the Landlord.
Abatement of Rent	4.04	If the said premises or the said Building or any part thereof shall be destroyed or so damaged by fire, typhoon, Act of God, force majeure or other cause beyond the control of the Landlord and not attributable to any act or default or negligence of the Tenant as to render the said premises unfit for commercial use and the policy or policies of insurance effected by the Landlord shall not have been vitiated or payment of

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		policy moneys refused in whole or in part in consequence of any act or default or negligence of the Tenant or if at any time during the continuance of this Agreement the said premises or the said Building shall be condemned as a dangerous structure or a demolition or closing order shall become operative in respect of the said premises or the said Building then the rent hereby agreed to be paid or a part thereof proportionate to the damage sustained or order made shall cease to be payable until the said premises or the said Building or part thereof shall have been restored or reinstated or the order removed Provided Always that the Landlord shall be under no obligation to reinstate the said premises or the said Building or part thereof And Provided further that should the said premises or the said Building or part thereof not have been reinstated or the order removed in the meantime either the Landlord or the Tenant may after six months of the occurrence of the destruction or damage or order give to the other of them notice in writing to terminate this Agreement but without prejudice to the rights and remedies of either party against the other in respect of any antecedent claim or breach of the agreements stipulations terms and conditions herein contained or of the Landlord in respect of the rent payable hereunder prior to such notice.
Liability & Indemnity	4.05	The Landlord shall not be under any liability whatsoever to the Tenant or to any persons whomsoever in respect of any damage sustained by the Tenant or such other person aforesaid caused by or through or in any way owing to the spread of fire or smoke or the overflow of water or the escape of any substance or anything from any premises situate in the said Building or caused by the act default or negligence of any tenant or occupier of such premises. The Tenant shall fully indemnify the Landlord against all claims demands actions and legal proceedings whatsoever made upon the Landlord in respect of any damage to any person whomsoever caused by the negligence of the Tenant or by or through or in anywise owing to the spread of fire or smoke or the overflow of water or the escape of any substance or anything from the said premises.
Acts of Servants, agents etc.	4.06	For the purpose of this Agreement any act default omission or negligence of the contractors servants agents licensees or invitees of the Tenant shall be deemed to be the act default omission or negligence of the Tenant.
Accidents	4.07	The Landlord shall not be responsible to the Tenant or the Tenant’s licensees servants agents or other persons in the said premises for any accident happening or injury suffered or damage to or loss of any chattel or property sustained on the said premises or in the said Building.
Security	4.08	The Landlord shall not be liable in any circumstances to the Tenant or any other person whomsoever for the security or safekeeping of the said premises or any persons or contents therein.
Distraint	4.09	For the purpose of Part III of the Landlord and Tenant (Consolidation) Ordinance relating to distress for rent or of these presents the rent payable in respect of the said premises shall be and be deemed to be in

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arrear if not paid in advance at the time and in manner hereinbefore provided for payment thereof. All costs and expenses for and incidental to the distraint shall be paid by the Tenant and shall be recoverable from it as a debt.

Deposit 4.10			(i	)	The Tenant shall on the signing of this Agreement pay to the Landlord the sum as set out in Part V of the First Schedule hereto (“the Deposit”) to secure the due observance and performance by the Tenant of agreements stipulations terms and conditions herein contained and on the Tenant’s part to be observed and performed. The Deposit shall be retained by the Landlord throughout the said term free of any interest to the Tenant and if the Tenant shall commit or suffer to be committed a breach of any of the terms and conditions herein the Landlord shall be entitled to terminate this Agreement in which event the Deposit shall be forfeited to the Landlord but without prejudice to any right of the Landlord in respect of any antecedent breach by the Tenant of the terms and conditions herein contained. Notwithstanding the foregoing the Landlord may in any such event at its option elect not to terminate this Agreement but to deduct from the Deposit the amount of any monetary loss incurred by the Landlord in consequence of the breach non-observance or non-performance by the Tenant in which event the Tenant shall as a condition precedent to the continuation of this tenancy deposit with the Landlord the amount so deducted and if the Tenant shall fail so to do the Landlord shall forthwith be entitled to re-enter the said premises or any part thereof in the name of the whole and to determine this Agreement in which event the Deposit may be forfeited to the Landlord as hereinbefore provided. Subject as aforesaid, the Deposit shall be refunded to the Tenant by the Landlord without interest within thirty working days after the expiration or sooner determination of this Agreement and the delivery of vacant possession to the Landlord or within thirty working days of the settlement of the last outstanding claim by the Landlord against the Tenant in respect of any breach, non-observance or non-performance of any of the terms and conditions herein contained and on the part of the Tenant to be observed and performed whichever is the later.
		(ii)			During the said term the Tenant shall maintain the Deposit at the sum equal to six months’ rent, air-conditioning and management charges and two quarters’ rates and government rent and if the rent or the air-conditioning and management charges, rates and government rent shall be increased the Tenant shall forthwith on demand pay to the Landlord the additional amount to make up such deposit.
Service of notice	4.11			Any notice hereunder shall be in writing and any notice to the Tenant shall be sufficiently served if left addressed to the Tenant on the said premises or sent to the Tenant by post or left at the Tenant’s last known

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address in Hong Kong and any notice to the Landlord shall be sufficiently served if delivered to the Landlord personally or sent to the Landlord by registered post at the Landlord’s registered office in Hong Kong.

Approval of the Landlord	4.12	No approval by the Landlord is valid unless it is in writing and signed by the Landlord or by its authorised agents and any approval or consent given by the Landlord shall operate as a consent for the particular matter to which it relates only and shall in no way be considered as a waiver or release of any of the provisions hereof nor shall it be construed as dispensing with the necessity of obtaining the specific written consent of the Landlord in the future, unless expressly so provided.
No premium	4.13	The Tenant hereby expressly declares that at the grant of the said term no premium key money or other consideration has been paid to the Landlord or to any person.
Interest on arrears of rent and other charges	4.14	Without prejudice to the Landlord’s rights under Clause 4.01 hereof, the Tenant shall pay interest on all arrears of rent and other charges at a rate of 2.5% per month from the due date to the date of payment together with all legal costs and disbursements on a solicitor and client basis incurred for demanding and enforcing payment of the said arrears or outstanding sum in Court or otherwise on demand and until payment they shall be deemed to be a debt due by the Tenant to the Landlord.
Name of the Building	4.15	The Landlord reserves the right exercisable at any time or times to change the name or description of the said Building or any part thereof without incurring any liability to the Tenant on any account whatsoever provided that the Landlord shall give to the Tenant not less than three months’ notice in writing of any such proposed change.
Renovation	4.16	The Tenant hereby expressly acknowledges that the Landlord may from time to time carry out any building, construction, renovation, refurbishment and other works in such part or parts of the Land and/or the said Building as the Landlord may deem fit and that the Landlord, its contractors agents workers and other persons authorized by the Landlord may enter into and upon any part of the Land and/or the said Building with all necessary plant equipment and material for such purpose. It is hereby expressly agreed that the Tenant shall have no right to claim against the Landlord for breach of any of the terms conditions or stipulations herein contained and on the Landlord’s part to be observed and performed and the Landlord shall not incur any liability to the Tenant and/or any person whatsoever in respect of any loss, damage, claim, cost or expense (including but not limited to loss of business and/or profit) that may be caused by or otherwise arising from or in connection with such works whether on the ground of inconvenience disturbance interruption or services noise dirt or otherwise.
Sale and Redevelopment	41.7	If the Landlord shall at any time resolve to demolish, re-build or refurbish the said Building or any part thereof (which intention shall be sufficiently evidenced by a copy of the Resolution of its Board of

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		Directors certified by its Secretary or a Director to be a true and correct copy) or shall have entered into any agreement for sale and purchase of the said Building or any part thereof which include the said premises, then in any of such event the Landlord shall be entitled to give not less than 6 calendar months’ notice in writing to expire at any time to terminate this Agreement, and immediately upon the expiration of such notice this Agreement shall terminate but without prejudice to the right and remedies of either party against the other in respect of any antecedent claim or breach of any of the covenants restrictions stipulations or conditions herein contained. The Tenant acknowledges that in the event of this Agreement being terminated pursuant to this Clause, the Tenant shall have no claim against the Landlord for such early termination. “Demolish” and/or “rebuild” for the purposes of this Clause shall mean the demolition and/or rebuilding of the whole of the said Building or a substantial part or parts (but not necessarily a major part) thereof whether or not including any main walls exterior walls or roof of the said premises and whether or not any part thereof is to be re-built or reconstructed in the same or any other manner. “Refurbish” may or may not include demolition of the said Building or any part thereof.
Landlord not liable for systems breakdowns	4.18	The Landlord shall not in any circumstances be liable to the Tenant for any defect in or breakdown of the lifts escalators or air-conditioning system condenser water supply system (if any) electric power and water supplies nor shall the rent or air-conditioning and management charges abate or cease to be payable on account thereof.
Common Area	4.19	The Landlord shall have the full right and liberty to partition and/or let to any person any part or parts of the said Building at any time intended for common use and to adjust or redefine the same as the Landlord may in its sole discretion decide without incurring any liability to the Tenant on any account whatsoever so long as all acts or works of the Landlord done or performed pursuant to its rights under this clause comply with all laws and regulations for the time being in force in Hong Kong.
Sale by Landlord	4.20	If the Landlord shall at any time assign the said premises to a purchaser of the Landlord, then the Deposit held by the Landlord hereunder (less any sum which the Landlord is entitled to deduct pursuant to the terms hereof) shall automatically be transferred to the purchaser. The Tenant hereby agrees that upon such transfer the Landlord shall be absolutely discharged from its obligations hereunder to refund the Deposit or any part thereof to the Tenant and the Tenant hereby further agrees to waive all the Tenant’s rights and claims hereunder against the Landlord in respect of the Deposit or any part thereof upon such transfer being made as aforesaid.

Handover Condition 4.21 (a) The Tenant hereby declares and confirms that it has duly inspected the said premises and is satisfied with the current state and condition of the said premises and the provisions, fixtures, fittings, finishes, installations and appliances therein (including without limitation, the ventilation and air-conditioning system, the fire service system and its sprinkler heads distribution, water

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and drainage systems (if any) and electrical and wiring system installed therein). The parties hereto agree that the said premises will be let to the Tenant by the Landlord on an “as-is” basis and in the state and condition as at the date of the handover of the said premises to the Tenant and no warranty or representation is made by the Landlord or its agents regarding:

(i)	the furniture, fixtures, fittings and finishes or the installations and appliances in the said premises and/or the said Building;
(ii)	the state and condition of the said premises or the Building and the user thereof; and
(iii)	the composition of the said Building.

(b) For the avoidance of doubt, the Landlord does not warrant that the ventilation and air-conditioning system (including the fan coil units), the fire services system (including the sprinkler heads distribution), the water and drainage systems (if any), and the electrical and wiring system installed in the said premises will comply with all or any applicable statutes, codes, ordinances, regulations or requirements of the relevant Government or other competent authorities or whether the same are suitable or sufficient for the Tenant’s intended purpose. Without prejudice to the provisions of Clauses 2.05.01, 2.05.02 and 2.06 hereof, if the Tenant shall require any alteration, additions, or improvement to the said systems, any such alteration, additions and improvement shall be made at the Tenant’s own costs and expenses and subject to the Landlord’s prior written consent.

Bank Consent 4.22 This Agreement shall be subject to the obtaining by the Landlord from the bank(s) to which the said premises are presently mortgaged to, the bank’s consent for the entering into this Agreement by the parties hereto. If the Landlord should fail or be unable for whatever reason to obtain the bank’s consent as aforesaid, this Agreement shall terminate upon expiration of fourteen (14) days from the date of a notice sent by the Landlord to the Tenant informing the Tenant of the Landlord’s failure to obtain the said consent. In the event of this Agreement being terminated pursuant to this provision, the Tenant shall deliver up vacant possession of the said premises to the Landlord upon expiration of fourteen (14) days from the date of the said notice and the Landlord shall upon the Tenant yielding up the said premises return the Deposit to the Tenant without compensation costs or interest and without prejudice to the Landlord’s right to deduct from the amount of the Deposit and to claim from the Tenant any damages the Landlord have suffered or will suffer as a result of any antecedent breach of this Agreement by the Tenant including but not limited to any failure of the Tenant to pay any sum(s) due under this Agreement prior and up to the date of termination of this Agreement. The Tenant acknowledges that in the event of this Agreement being terminated by reason of the failure of the Landlord to obtain the relevant consent from the bank, the Tenant shall have no claim against the Landlord for such earlier termination.

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Stamp Duty	4.23	All stamp duty and registration fee (if any) payable on this Agreement and other disbursements of and incidental to the preparation and execution of this Agreement shall be borne by the parties hereto in equal shares.
Costs	4.24	The legal costs of and incidental to the preparation and execution of this Agreement shall be borne by the parties hereto in equal shares. If the Tenant instructs its own solicitors, the Tenant shall, in addition to his own legal costs and expenses, pay half of the Landlord’s solicitors full costs (at 75% of the scale charges) and expenses.

Interpretation	4.25	(i)	Unless the context otherwise requires, words herein importing the masculine gender shall include the feminine and neuter gender and words herein in the singular shall include the plural and vice versa.
		(ii)	References to Clauses, Sub-clauses and Schedules are to Clauses Sub-clauses of and Schedules to this Agreement. Marginal notes and the index (if any) are inserted for convenience of reference only and shall not affect the interpretation of this Agreement.
		(iii)	The expression “the Tenant” shall (where the context permits) mean and include the party or parties specifically named and its or their successors in title and permitted assigns.

Joint and several Liability	4.26	If the Tenant consists of two or more persons, each covenant or agreement on the part of the Tenant herein shall be deemed to have been given by them jointly and severally.
Entire Agreement	4.27	This Agreement sets forth the entire agreement between the parties and supersede any prior discussions, agreements or arrangements, written or verbal, between the parties relating to the letting of the said premises.
		AS WITNESS, the hands of the parties hereto the day and year first above written.

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THE FIRST SCHEDULE ABOVE REFERRED TO

PART I

LANDLORD	:	GILROY COMPANY LIMITED whose registered office is situate at 11th Floor, Lai Sun Commercial Centre, No. 680 Cheung Sha Wan Road, Shamshuipo, Kowloon, Hong Kong.
TENANT	:	MARKETSHARE LIMITED whose registered office is situate at Room 1101, 11th Floor, Beautiful Group Tower, 77 Connaught Road Central, Hong Kong (Company No. 954680 and Business Registration No. 35402855).

PART II

(the said premises)

ALL THAT UNIT NO. 1802 on the EIGHTEENTH FLOOR of CAUSEWAY BAY PLAZA 2, No. 463-483 Lockhart Road, Hong Kong erected on All Those pieces or parcels of ground registered in the Land Registry as The Remaining Portion of Section D of Inland Lot No. 2833, The Remaining Portion of Section E of Inland Lot No. 2833, Section J of Inland Lot No. 2833, The Remaining Portion of Section K of Inland Not No. 2833, The Remaining Portion of Section L of Inland Lot No. 2833, The Remaining Portion of Section M of Inland Lot No. 2833, The Remaining Portion of Section O of Inland Lot No. 2833, The Remaining Portion of Section G of Inland Lot No. 2833, The Remaining Portion of Section H of Inland Lot No. 2833, Sub-Section 4 of Section H of Inland Lot No. 2833 and The Remaining Portion of Inland Lot No. 2833 (“the Land”) which said Unit is for the purpose of identification only shown and coloured Pink on the floor plan annexed hereto.

PART III

TERM : For the term of THREE (3) YEARS commencing from the 1^st day of October 2007 (“the Commencement Date”) and expiring on the 30^th day of September 2010 (both days inclusive).

PART IV

Business Name in the said premises

BUSINESS NAME : Marketshare Limited

PART V

Amount of Deposit

Deposit: : HONG KONG DOLLARS TWO HUNDRED TWENTY SIX THOUSAND TWENTY FIVE AND CENTS SEVENTY/ONLY (HB$226,025.70)

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PART VI

User

User : For the Tenant’s lawful business as an office use only and not for any other purpose whatsoever.

THE SECOND SCHEDULE ABOVE REFERRED TO

PART I

Particulars of Rent

Rent:	:	(I)	The rent for the said term shall be HONG KONG DOLLARS THIRTY THOUSAND THREE HUNDRED AND SIXTY (HK$30,360.00) per calendar month exclusive of rates, government rent, air-conditioning and management charges and other outgoings and payable in advance without any deductions on the first day of each and every calendar month the first of such payment to be made on the signing hereof.
		(II)	Rent Free Period: No rent will be charged for the first ONE (1) MONTH commencing from the Commencement Date and expiring on 31st October 2007 and for a further period of ONE (1) MONTH commencing from 1st September 2010 and expiring on 30th September 2010. During the Rent Free Period, the Tenant shall pay the rates, government rent, air-conditioning and management charges and all other outgoings in respect of the said premises.

PART II

Particulars of Air-Conditioning and Management Fee

1. Air-Conditioning and Management Charges: HK$6,110.00 per calendar month payable monthly in advance without any deductions on the first day of each and every calendar month the first of such payment to be made on the signing hereof.

2. (a) The Landlord shall, where the said premises are to be used as a shop only provide and maintain air-conditioning at all times during the normal business hours specified in paragraph (a) of Part II of the Third Schedule hereto and, where the said premises are to be used as an office only during the normal business hours specified in paragraph (b) of Part II of the Third Schedule hereto and, where the said premises are to be used as a restaurant only, during the normal business hours specified in paragraph (c) of Part II of the Third Schedule hereto and without prejudice to the provisions of Clause 4.18 the Landlord shall not be liable to the Tenant nor shall the Tenant have any claim against the Landlord in respect of any interruption in any of the services hereinbefore mentioned by reason of the necessary repair or maintenance of any installations or apparatus or damage thereto or destruction thereof by fire water act of God or other cause beyond the Landlord’s control or by reason of mechanical or other defect or breakdown or faults or other inclement conditions or unavoidable shortage of fuel material water or labour or

25

any act omission or negligence of any attendants watchmen or other servants of the Landlord in or about the performance or purported performance of any duty relating to the provision of the said services by any of them or by reason of the cessation of the Tenant’s business. Furthermore, no air-conditioning will be provided if the No. 8 typhoon signal or above is hoisted but the air-conditioning and management charges shall not be abated by reason thereof.

(b)

If the Tenant shall require additional air-conditioning services outside the normal business hours mentioned above, the Tenant shall give to the Landlord not less than 7 days’ notice in writing stipulating at what times the Tenant shall require additional air-conditioning. All costs and expenses so incurred shall be on Tenant’s account payable at such rate as may be determined by the Landlord and subject to variation from time to time at the Landlord’s discretion Provided that a minimum of two hours’ charges shall be paid by the Tenant each time the said premises shall receive such additional air-conditioning services.

PART III

Particulars of Rates and Government Rent

Rates: : HK$3,602.85 (or such amount as assessed by the Government) per quarter payable quarterly in advance without any deductions on the first day of the months of January, April, July and October.

PART IV

Amount of Vetting Fee

Vetting Fee : HK$1,897.50

PART V

Amount of Sundry Expenses Deposit during Fitting Out Work

Sundry Expenses Deposit:       HK$2,000.00

PART VI

Amount to defray the Sundry Expenses during Fitting Out Work

Amount to defray Sundry Expenses:      HK$3,000.00

THE THIRD SCHEDULE ABOVE REFERRED TO

PART I

The normal business hours of the said Building are:

(a) where the said premises are to be used as a shop only, between the hours of 10:00 a.m. and 10:00 p.m. everyday.

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(b)	where the said premises are to be used as an office only, between the hours of 09:00 a.m. and 06:00 p.m. every weekday (Monday — Friday) and between the hours of 09:00 a.m. and 01:00 p.m. every Saturday.
(c)	where the said premises are to be used as a restaurant only, between the hours of 10:00 a.m. and 12:00 mid-night everyday.

The Landlord reserves the right to alter or amend the said business hours from time to time and to such extent as the Landlord shall in its discretion deem appropriate or necessary.

PART II

The normal hours when air-conditioning services will be supplied are:

(a)	where the said premises are to be used as a shop only, between the hours of 10:00 a.m. and 10:00 p.m. everyday.
(b)	where the said premises are to be used as an office only, between the hours of 09:00 a.m. and 06:00 p.m. every weekday (Monday — Friday) and between the hours of 09:00 a.m. and 01:00 p.m. every Saturday.
(c)	where the said premises are to be used as a restaurant only, between the hours of 10:00 a.m. and 12:00 mid-night everyday.

The Landlord reserves the right to alter or amend the said supply hours from time to time and to such extent as the Landlord shall in its discretion deem appropriate or necessary.

SIGNED by

SIGNED by Mr. Lau Shu Yan, Julius and Mr. Tam Kin Man, Kraven	)
for and on behalf of the Landlord whose signature(s) is/are verified by:-	) ) ) )	For and on behalf of GILROY COMPANY LIMITED /s/ Lau Shu Yan, Julius          Tam Kin Man, Kraven
		Authorized Signature(s)
/s/ Yeung Chi Keung
Yeung Chi Keung
Solicitor, Hong Kong SAR
Vincent T.K. Cheung, Yap & Co.

     RECEIVED on or prior to the day and year first above written of and from the Tenant the sum of HONG KONG DOLLARS TWO HUNDRED TWENTY SIX THOUSAND TWENTY FIVE AND CENTS SEVENTY ONLY (HK$226,025.70) being the deposit money above mentioned to be paid by the Tenant to the Landlord.

27

For and on behalf of
GILROY COMPANY LIMITED
 

/s/ Lau Shu Yan, Julius          Tam Kin [Illegible]  

Authorized Signature(s) 

The Landlord 

28

SIGNED by Anthony Venus for and on behalf of the Tenant in the presence of:-	) ) ) ) )	For and on behalf of Marketshare Limited /s/ Anthony Venus
		Authorized Signature(s)
/s/      Yvette [Leung] Signature of Witness
Yvette [Leung] Name of Witness
[Illegible] Hong Kong Identity Card Number
Unit 1803-4, Causeway Bay, Plaza [L] Address of Witness
Executive Assistant Occupation of Witness

29

[18th FLOOR PLAN REDACTED]

EX-10.6.29

Exhibit 10.6.29

THIS SUPPLEMENTAL AGREEMENT is made this 21st day of April, 2008

BETWEEN:

(1)	GILROY COMPANY LIMITED whose registered office is situate at 11th Floor, Lai Sun Commercial Centre, No. 680 Cheung Sha Wan Road, Shamshuipo, Kowloon, Hong Kong (“the Landlord”); and
(2)	MARKETSHARE LIMITED whose registered office is situate at 16th — 19th Floors, Prince’s Building, 10 Chater Road, Central, Hong Kong (“the Tenant”) (Company No. 954680) (Business Registration No. 35402855-000-03-07A).

WHEREAS:

(A)	By a Tenancy Agreement dated the 28th day of May 2007 and made between the Landlord and the Tenant (“the Tenancy Agreement”) the Landlord granted and the Tenant took a lease of ALL THAT UNIT NOS. 1803 and 1804 on the EIGHTEENTH FLOOR of CAUSEWAY BAY PLAZA 2, No. 463-483 Lockhart Road, Hong Kong (“the said premises”) for a term of Three (3) years commencing from the 1st day of March 2007 and expiring on the 28th day of February 2010 (“the said term”) at the rent and upon and subject to the terms and conditions therein contained.
(B)	The Tenant has requested and the Landlord has agreed to extend the said term and to vary the terms of the Tenancy Agreement upon the conditions and provisions contained in this Supplemental Agreement.
(C)	This Supplemental Agreement is supplemental to the Tenancy Agreement and all terms defined in the Tenancy Agreement shall (where applicable) have the same meaning in this Supplemental Agreement.

NOW IT IS HEREBY AGREED as follows:

1.	Subject to the terms, conditions and modifications hereinafter mentioned, the Landlord hereby leases the said premises to the Tenant and the Tenant hereby leases and takes the said premises from the Landlord for a further term of seven (7) months under the Tenancy Agreement such that the said term granted under the Tenancy Agreement is hereby extended from 1st March 2010 to 30th September 2010. Pursuant to such extension, the said term granted by the Landlord under the Tenancy Agreement is hereby modified.
2.	The Tenant shall upon its execution of this Supplemental Agreement deposit with the Landlord a sum of HONG KONG DOLLARS THIRTY TWO THOUSAND TWO HUNDRED AND TWENTY (HB$32,220.00) (“the Additional Deposit”) as additional deposit which shall be held by the Landlord (together with the Deposit currently held by the Landlord under the Tenancy Agreement) as part of the Deposit without liability for interest as security for the due performance and observance by the Tenant of the Tenant’s agreements, covenants and obligations under the Tenancy Agreement upon and subject to the terms and conditions of the Tenancy Agreement.
3.	With effect from the date of this Supplemental Agreement, the Tenancy Agreement shall be deemed varied, modified and extended in accordance with the provisions set out in the Schedule hereto.

1

4.	Save and except insofar as varied, modified, extended and supplemented by this Supplemental Agreement, the Tenancy Agreement and all the terms, conditions, agreements, covenants, exceptions and reservations contained in the Tenancy Agreement shall remain in full force and effect and the Tenant hereby covenants and undertakes with the Landlord that the Tenant shall observe, perform and comply with the same (as hereby varied, modified, extended and supplemented).
5.	The legal costs and expenses incurred by the Landlord in connection with the preparation and completion of this Supplemental Agreement and all stamp duty, adjudication fee and registration fee (if any) payable on this Supplemental Agreement and its counterpart shall be paid by the Tenant solely. The Tenant shall be responsible for its own legal costs and expenses in connection with the preparation and completion of this Supplemental Agreement.
6.	The Tenant hereby expressly declares that for the grant of the extension of the said term no key money or premium or other consideration otherwise than the rent and other payments herein expressly reserved and expressed to be payable has been paid or will be payable to the Landlord or to any other person whosoever.
7.	This Supplemental Agreement shall be governed by and interpreted in accordance with the laws of the Hong Kong Special Administrative Region of the People’s Republic of China.

AS WITNESS, the parties hereto have duly executed this Supplemental Agreement the day and year first above written.

2

THE SCHEDULE ABOVE REFERRED TO

1.	Part III of the First Schedule to the Tenancy Agreement shall be deemed to be deleted and substituted by the following:
	For the term of THREE (3) years and SEVEN (7) MONTHS commencing from the 1st day of March 2007 (“the Commencement Date”) and expiring on the 30th day of September 2010 (both days inclusive).
2.	Part I of the Second Schedule to the Tenancy Agreement shall be deemed to be deleted and substituted by the following:

Rent:	(I)	The rent for the said term shall be HONG KONG DOLLARS FIFTY NINE THOUSAND AND SEVENTY ONLY (HK$59,070.00) per calendar month for the period from 1st March 2007 to 28th February 2010 and HONG KONG DOLLARS SIXTY FOUR THOUSAND FOUR HUNDRED AND FORTY (HK$64,440.00) per calendar month for the period from 1st March 2010 to 30th September 2010, all exclusive of rates, government rent, air-conditioning and management charges and other outgoings and payable in advance without any deductions on the first day of each and every calendar month the first of such payment to be made on the signing hereof.
	(II)	Rent Free Period: No rent will be charged for two (2) months commencing from the Commencement Date and expiring on 30th April 2007. During the Rent free Period, the Tenant shall pay the rates, government rent (if any), air-conditioning and management charges and all other outgoings in respect of the said premises.

3

SIGNED by Mr. Lau Shu Yan, Julius	)
for and on behalf of the Landlord whose signature(s) is/are verified by:-	) ) ) )	For and on behalf of GILROY COMPANY LIMITED /s/ Lau Shu Yan, Julius
		Authorized Signature(s)
/s/ Yeung Chi Keung
Yeung Chi Keung
Solicitor, Hong Kong SAR
Vincent T.K. Cheung, Yap & Co.

     RECEIVED on or prior to the day and year first above written of and from the Tenant the sum of HONG KONG DOLLARS THIRTY TWO THOUSAND TWO HUNDRED AND TWENTY (hk$32,220.00) being the Additional Deposit above mentioned to be paid by the Tenant to the Landlord.

For and on behalf of
GILROY COMPANY LIMITED
 

/s/ [Illegible Signature]  

Authorized Signature 

The Landlord 

SIGNED by Anthony Venus for and on behalf of the Tenant in the presence of:-	) ) ) ) )	For and on behalf of Marketshare Limited /s/Anthony Venus                 Authorized Signature(s)
/s/ Yvette [Leung]
Signature of Witness
Yvette [Leung]
Name of Witness
[Illegible]
Hong Kong Identity Card Number
Rm 1802-4, Causeway Bay, Plaza [L]
Address of Witness
Executive Assistant
Occupation of Witness

1

EX-21

Exhibit 21

Subsidiaries of Harris Interactive Inc.

Louis Harris & Associates, Inc.

Wirthlin Worldwide, LLC

Harris Interactive International, Inc.

GSBC Ohio Corporation

Harris Interactive Asia, LLC

The Wirthlin Group International, LLC

Wirthlin UK Limited

HI UK Holdings Limited

Romtec UK Limited

Harris Interactive UK Limited

Teligen UK Limited

Wirthlin Europe Limited

Harris Interactive SAS

Harris Interactive AG

2144798 Ontario Inc.

Harris/Decima, Inc.

Opinion Search Inc.

Harris Interactive Asia Limited

Marketshare Limited

Marketshare Pte. Ltd.

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-31776, No. 333-31778, No. 333-49336, No. 333-69056, No. 333-72842, No. 333-121250, No. 333-147971, No. 333-147974 and No. 333-149831) and the Registration Statement on Form S-3 (No. 333-73778) of Harris Interactive Inc. of our report dated August 31, 2009, relating to the financial statements and financial statement schedule, which appears in this Form 10-K.

PricewaterhouseCoopers LLP
Rochester, New York
August 31, 2009

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Kimberly Till, certify that:

1. I have reviewed this report on Form 10-K of Harris Interactive Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 31, 2009	Signature:	/s/ KIMBERLY TILL
		Kimberly Till
		President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Robert J. Cox, certify that:

1. I have reviewed this report on Form 10-K of Harris Interactive Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 31, 2009	Signature:	/s/ ROBERT J. COX
		Robert J. Cox
		Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report on Form 10-K of Harris Interactive Inc. (the “Company”) for the fiscal year ended June 30, 2009, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kimberly Till, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Signature:	/s/ KIMBERLY TILL
	Kimberly Till
	President and Chief Executive Officer

Dated: August 31, 2009

EX-32.2

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report on Form 10-K of Harris Interactive Inc. (the “Company”) for the fiscal year ended June 30, 2009, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert J. Cox, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Signature:	/s/ ROBERT J. COX
	Robert J. Cox
	Executive Vice President, Chief Financial Officer and Treasurer

Dated: August 31, 2009