Argent To Purchase Tower And Adjacent Properties In $50 Million All-Cash Deal

Capitol Records and Capitol Studios To Continue Operations in This Historic Hollywood Location

LONDON AND LOS ANGELES, 28 SEPTEMBER 2006 – EMI Music North America has entered into an agreement with Argent Ventures, the New York-based commercial property owner and developer, to sell the Capitol Records Tower and adjacent properties to Argent for $50 million. As part of the agreement, EMI has entered into a long term lease with Argent, which will enable the Capitol Records label and Capitol Studios to continue their operations at these facilities for many years to come.

The sale of these facilities is consistent with EMI’s strategy to divest of non-core real estate assets, and in some cases, enter into leaseback arrangements, as the company recently did earlier this year with two facilities in Japan.

Argent’s acquisition includes the Capitol Tower -- the famous cylindrical building designed to resemble a stack of records, topped with a stylus needle which blinks out “Hollywood” in Morse code. Since opening its doors in 1956, the building has become a fixture in the Hollywood landscape, and home to the legendary Capitol Records label and the Capitol Studios, where artists such as label founder Johnny Mercer, Nat King Cole, Frank Sinatra and The Beach Boys recorded. Argent is also acquiring the adjacent Gogerty building and a parking lot on Argyle Avenue.

EMI will retain the trademark and rights to the imagery of the Capitol Tower.

"We are grateful for EMI's continuing commitment to a community of which we are now a part," said Michael Gargano, Managing Director at Argent Ventures. "Being able to become a stakeholder in Hollywood through the acquisition of such an iconic building, while preserving the operational presence of a landmark company is exactly how we had hoped to approach the Los Angeles market."

“We are pleased to enter into this sale and leaseback with Argent, a company whose track record includes some prestigious and high profile properties in New York and Miami,” said David Munns, Chairman and CEO of EMI Music North America. “This is part of the restructuring effort we announced in April, and will help to ensure our organisation remains flexible, with a focus on investment in the key areas of A&R, marketing and the development of our digital business. We are happy to carry on the heritage and tradition of making and marketing great music in this historic building.”

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