Affiliation Agreement [Amendment] - Playboy Entertainment Group Inc. and Satellite Services Inc.
AMENDMENT
to
Affiliation Agreement between
PLAYBOY ENTERTAINMENT GROUP, INC.
and
SATELLITE SERVICES, INC.
WHEREAS, Playboy Entertainment Group, Inc. ("Playboy") and Satellite Services,
Inc. ("Affiliate") entered into the Affiliation Agreement dated February 10,
1993, as amended (the "Agreement"), under which Playboy licensed the use of its
Playboy programming service to SSI;
WHEREAS, the parties acknowledge and agree that Affiliate was acquired by
Comcast Corporation, and Affiliate's offices now are located at 1500 Market
Street, Philadelphia, Pennsylvania 19102; and
WHEREAS, Playboy and Affiliate now desire to amend the Agreement per this
amendment (the "Amendment").
NOW, THEREFORE, in consideration of the foregoing and the mutual promises and
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Playboy and Affiliate
hereby agree as follows:
1. This Amendment shall become effective upon the date of the last
signature written below (the "Amendment Effective Date").
2. Capitalized terms used in this Amendment, unless otherwise defined
herein, shall have the meanings set forth in the Agreement.
3. Except as expressly modified herein, all terms of the Agreement
shall remain in full force and effect. In the event of a conflict
between the terms and conditions of this Amendment and the
Agreement, the terms of this Amendment shall govern.
4. The parenthetical phrase "(the "Service")" in Section 1(a) shall be
deleted in its entirety and replaced with the parenthetical phrase
"(the "Service," which term "Service" also shall refer to Network's
linear programming service and the SVOD Content, the VOD Content,
and/or the HVOD Content, as applicable)";
5. Section 1(a)(i) shall be amended by adding the following
parenthetical immediately following the phrase "whether now existing
or developed in the future": *****. Furthermore, Distribution
Technology shall not include distribution to personal mobile and
cellular handheld devices (provided that personal mobile and
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cellular handheld devices will not include Short-Range Wireless
Devices, as defined below). *****. A "Set-Top Box" means a device
that connects to, or is integrated as part of, a television or other
video output display device ("Display Device") and also connects to
the source of Affiliate's audio/visual signal, the content of which
then is displayed on the Display Device. A Set-Top Box located at a
Subscriber's premises may be connected through short-range wireless
technology to one or more Set-Top Boxes and/or Display Devices
authorized by Affiliate for use in and around a Subscriber's
premises ("Short-Range Wireless Devices"). *****.
6. Section 1(a)(iii) shall be deleted in its entirety and replaced with
the following: ***** then *****.
7. The second sentence of Section 2(a) of the Agreement is deleted in
its entirety and replaced with the following:
The Initial Term of this Agreement shall commence upon the date of
execution hereof and shall terminate on December 31, 2015, unless
terminated sooner pursuant to the terms of this Agreement.
8. In the first sentence of Section 3(a) of the Agreement, the words
"ten (10) hours per day (initially, from 8:00 p.m. to 6:00 a.m.
prevailing Eastern Time)" shall be replaced with "twenty four (24)
hours per day" and the words "(including but not limited to R-rated
(or R equivalent non-rated) and NC-17 rated (or NC-17 equivalent
non-rated) cable version motion pictures)" shall be deleted.
9. Section 4(c) of the Agreement shall be deleted in its entirety and
replaced with the following:
(c) The Systems, if any, shall carry the Service no less than
twenty-four (24) hours per day; provided, however, that any System
that carries the Service on an analog level of service may carry the
Service less than twenty-four (24) hours per day but not less than
ten (10) hours per day. Other than as specifically permitted in this
Agreement, Affiliate will not insert or remove any material into or
from the Service. Network agrees that Affiliate will have complete
authority to control, to designate and to change the channel(s) over
which the Service is to be carried on each System.
10. The first sentence of Section 4(e) of the Agreement is deleted in
its entirety and replaced with the following:
Each System or other distribution facility or enterprise may offer
the Service, (i) as a Subscription (defined in Section 5(a)(viii)
below) service; and/or (ii) as a Pay-per-view (defined in Section
5(a)(vii) below) service marketed and sold in any of the ways
described in Section 5(a)(vii). The Service may be sold in
combination with other services (e.g., in a package of services or
in a tier); provided that the Service, and/or viewing segments of
the Service as described in Section 5(a)(viii), must always also be
available for sale through each
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television distribution facility selling the Service under this
Agreement on a purely a la carte basis.
11. In the last two sentences of Section 4(f) of the Agreement, the
phrase "home taping" shall be replaced by "home taping and/or
digital recording." Additionally, the following shall be added to
the end of the last sentence:
"; or (iii) authorizing Subscribers to use devices and/or
functionality (whether provided by Affiliate or otherwise) that
enables such Subscribers to engage in lawful duplication, digital
recording, and/or playback of the Service or any portions thereof
for non-public viewing of such content."
12. The following language is hereby added as Section 4(h) of the Agreement:
(h) Affiliate shall have the right to make the SVOD Content
available, on an SVOD basis, to any Subscription (as defined in
Section 5(a)(viii)) subscriber either by means of the Distribution
Technology, *****. Network shall be responsible for supplying to
Affiliate: (1) a minimum of ***** of SVOD Content (defined in
Section 5(a)(xiii) below) at any given time to be made available by
means of the Distribution Technology, which shall be refreshed on a
weekly basis such that at least ***** of the SVOD Content offered by
means of the Distribution Technology is changed each month (the
"TV-SVOD Content"); and (2) within *****. The TV-SVOD Content and
***** Content shall be selected by Network in its sole discretion
and may be comprised of different titles, provided that Network
shall make commercially reasonable efforts to accommodate
Affiliate's requests concerning (i) the types of programming to be
included in the SVOD Content (such as the inclusion of Network's
signature programming); (ii) the total amount of SVOD Content that
is made available by Network; and (iii) the amount and extent to
which the Programs comprising the SVOD Content are refreshed. Unless
otherwise notified in writing by Affiliate that Affiliate desires XX
exclusively (meaning Affiliate no longer wants X content), XX.5,
and/or XXX as part of the SVOD content, the SVOD Content will
include only X and XX rated Programs (as such ratings designations
are generally understood in the industry). Network shall at all
times offer to make available to Affiliate any adult content
(regardless of ratings) made available by Network to any other
United States distributor for Service subscribers to view on an SVOD
basis. Notwithstanding anything to the contrary in this Agreement,
Network hereby agrees that Affiliate shall at all times, and at any
time during the Term, have the absolute right to air or offer or to
cease airing or offering any SVOD Content to any individual and/or
System(s). Affiliate, at its own expense, shall obtain and install
equipment necessary to distribute the SVOD Content to such
subscribers from the server in each System's headend. Network, at
its own expense, shall deliver the SVOD Content in compliance with
generally
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accepted standards of good practice and according to parameters
specified in the CableLabs Video On Demand Content Specification
Version 1.0 ("CLI 1.0") or future releases thereof, including all
applicable digitally encoded non-video data attributes ("Meta
Data"). Network shall deliver the SVOD Content via either of the
following methods, as selected by Network at its sole option, upon
advance written notice: (i) satellite or program master to the
Comcast Media Center ("CMC") in Denver, Colorado, or (ii) FTP
directly to a point or points designated by Affiliate. The maximum
MPEG 2 encoding data rate shall be 3.75 mbps, provided that Network
agrees that when it becomes commercially feasible or industry
standard to do so, then Network will encode at a maximum rate of
3.375 mbps. Network shall bear all costs in connection with the
encoding of, and the transport to applicable Systems of, the SVOD
Content regardless of the method of delivery (and to the extent
necessary to ensure Network's compliance with the provisions of this
sentence (including if Network elects to deliver unencoded SVOD
Content to the CMC), Network shall enter into an agreement, and/or
maintain any existing agreement, with the CMC concerning the CMC's
services related to such encoding and transport).
13. The following language is hereby added as Section 4(i) of the Agreement:
(i) Affiliate shall have the right to make any VOD Content and HVOD
Content titles offered by Network available to any subscriber on a
VOD basis. Network shall be responsible under this Agreement and
that certain Affiliation Agreement between Spice, Inc. (as
predecessor in interest to Spice) and Affiliate dated November 1,
1992, as amended (the "Spice Agreement") collectively for supplying
to Affiliate a minimum of ***** of VOD Content (defined in Section
5(a)(xiv) below) and a minimum of ***** of HVOD Content (defined in
Section 5(a)(xiv) below) at any given time, which shall be refreshed
on a weekly basis such that at least ***** of the VOD Content and
HVOD Content is changed each month; provided, however, that Network
shall make commercially reasonable efforts to accommodate
Affiliate's requests concerning (i) the types of programming to be
included in the VOD Content and HVOD Content; (ii) the total amount
of VOD Content and HVOD Content that is made available by Network;
and (iii) the amount and extent to which the Programs comprising the
VOD Content and HVOD Content are refreshed. Unless Affiliate
notifies Network in writing that it desires for the VOD Content
and/or HVOD Content to include X rated, XX.5 rated, and/or XXX
Programs, the VOD Content and HVOD Content will include only X and
XX rated Programs (as such ratings designations are generally
understood in the industry). Network shall at all times offer to
make available to Affiliate any adult content made available by
Network to any other United States distributor for subscribers to
view on an VOD basis (including other versions of content provided
to Affiliate with a different editing standard). Notwithstanding
anything to the contrary in this Agreement, Network hereby agrees
that Affiliate shall at all times, and at any time during the Term,
have the absolute right to air or offer or to cease airing or
offering any VOD Content
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or HVOD Content to any individual and/or System(s). Affiliate, at
its own expense, shall obtain and install equipment necessary to
distribute the VOD Content and HVOD Content to such subscribers from
the server in each System's headend. Network, at its own expense,
shall deliver the VOD Content and HVOD Content in compliance with
generally accepted standards of good practice and according to
parameters specified in the CableLabs Video On Demand Content
Specification Version 1.0 ("CLI 1.0") or future releases thereof,
including all applicable digitally encoded non-video data attributes
("Meta Data"). Network shall deliver the VOD Content and HVOD
Content via either of the following methods, as selected by Network
at its sole option, upon advance written notice: (i) satellite or
program master to the Comcast Media Center ("CMC") in Denver,
Colorado, or (ii) FTP directly to a point or points designated by
Affiliate. The maximum MPEG 2 encoding data rate shall be 3.75 mbps,
provided that Network agrees that when it becomes commercially
feasible or industry standard to do so, then Network will encode at
a maximum rate of 3.375 mbps. Network shall bear all costs in
connection with the encoding of the VOD Content and HVOD Content
regardless of the method of delivery (and to the extent Network
elects to deliver unencoded VOD Content and HVOD Content to the CMC,
Network shall enter into an agreement with the CMC concerning the
CMC's encoding of such VOD Content and HVOD Content).
14. The following language is hereby added as Section 4(j) of the Agreement:
(j) Network shall be responsible for any and all royalties and/or
other fees payable to any applicable programming licensor(s) for
content included in the VOD Content and HVOD Content (including,
without limitation, residuals or other payments to guilds or unions,
rights for music clearances, including but not limited to Network's
through-to-the-viewer performance rights, synchronization rights,
and mechanical rights, and all other content-related fees, payments,
or obligations arising out of the activities contemplated by this
Agreement), and Affiliate shall have no responsibility or liability
for any such content-related royalties or fees, including any
royalties or fees associated with distribution of the VOD Content or
HVOD Content via VOD, except for fees payable to Network in
accordance with Section 5 of this Agreement. Network acknowledges
that Affiliate may, from time to time, direct Network not to include
as part of the VOD Content or HVOD Content any particular Program
that Affiliate reasonably determines does not meet the intent of the
rating such Program has been given or otherwise may cause Affiliate
business, political, or operational difficulty; provided, however,
that such Program shall count toward Network's satisfaction of its
obligations hereunder to provide the minimum number of hours of VOD
Content and HVOD Content for the period of time during which such
Program was scheduled to be made available as part of the VOD
Content or HVOD Content. The VOD Content and HVOD Content shall not
contain any sponsorships or advertising, except sponsorship or
advertising for the Service permitted under this Agreement or
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the Spice Agreement.
15. The second sentence of Section 5(a) of the Agreement is hereby deleted in
its entirety and replaced with the following:
The Fees defined below shall be calculated, stated, and reported
separately for each category of Subscriber.
16. The second sentence of each of Sections 5(a)(i), 5(a)(ii), 5(a)(iii) and
5(a)(iv) of the Agreement, which contain the definitions of, respectively,
"PPV Satellite Fees", "Service Satellite Fees", "PPV Cable Fees" and
"Service Cable Fees", are hereby deleted.
17. Section 5(a)(vi) of the Agreement is deleted in its entirety and replaced
with the following:
(a)(vi) "Fees" means the fees payable by Affiliate to Network, as
described in Section 5(b) below. Fees payable by Affiliate to
Network during a Renewal Term are referred to as Renewal Fees.
18. The following language is hereby added as Section 5(a)(xiii) of the
Agreement:
(a)(xiii) "SVOD" means the authorization of a Subscriber to receive
the SVOD Content, as defined herein. For purposes hereof, the "SVOD
Content" shall mean all content delivered by Network to Affiliate
for delivery to Service Cable Subscribers or Service Satellite
Subscribers on a per-Program basis without charge in connection with
a Subscription service purchased by such subscriber pursuant to this
Agreement. A "Program" shall mean an individual feature film,
direct-to-video programming (including a movie), extended-length
video, live performance or production, or other audio-visual
program; provided, however, that each such Program shall be (i)
professionally produced, commercial free, high quality heterosexual
male- and couple-targeted adult-oriented content intended only for
adult consumers because of its sexual content; and (ii) at least
twenty (20) minutes in duration.
19. The following language is hereby added as Section 5(a)(xiv) of the
Agreement:
(a)(xiv) "VOD" means the authorization of a subscriber to receive
the VOD Content or HVOD Content that is chosen by a subscriber for
display to that subscriber. For purposes hereof, the "VOD Content"
shall mean all content delivered by Network to Affiliate for
delivery to subscribers on a per-Program basis in exchange for a
per-viewing fee. For purposes hereof, the "HVOD Content" shall mean
high-definition content delivered by Network to Affiliate for
delivery to subscribers on a per-Program basis in exchange for a
per-viewing fee.
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20. Section 5(b) (including Sections 5(b)(i) through 5(b)(iii)) of the
Agreement is deleted in its entirety and replaced with the following:
(b) Affiliate will pay Network the applicable Revenue Share
Percentage (as defined in Section 5(d)) of Gross Receipts, less the
deductions described in Section 5(f), subject to a monthly minimum
of ***** per Service Cable Subscriber or Service Satellite
Subscriber. When the Service is sold to a Service Cable Subscriber
or Service Satellite Subscriber in combination with other services
for a package charge (as, for example, in a tier or in a package of
a la carte or other services), the Gross Receipts deemed to be
attributable to a Service Cable Subscriber or Service Satellite
Subscriber for the Service shall be equal to the total Gross
Receipts for the tier or package of services sold in combination
with the Service, multiplied by a fraction, the numerator of which
is the a la carte retail charge for the Service otherwise charged
for the pertinent System and the denominator of which is the
numerator plus the aggregate of the a la carte retail charges
otherwise charged by the pertinent System for the other services
included in the tier or package of a la carte or other service. In
addition, if Affiliate provides the Service to multiple dwelling
complexes, including, but not limited to, apartment buildings, on a
bulk-rate basis, the number of Service Satellite Subscribers or
Service Cable Subscribers (as the case may be) attributable to each
such bulk-rate subscriber shall be equal to the total monthly retail
rate charged a complex for the Service divided by the standard
monthly retail rate charged a non-bulk rate Service Satellite
Subscriber or Service Cable Subscriber (as the case may be) for the
Service in the applicable System or by the pertinent Satellite
distributor, as the case may be.
21. Section 5(c) of the Agreement is deleted in its entirety and replaced with
the following:
(c) For each PPV Cable Subscriber and each PPV Satellite Subscriber who
receives and pays for one (1) technically satisfactory viewing of one (1)
viewing segment of the Service, including by means of VOD, Affiliate will
pay Network the Network Share (as defined below) of the Gross Receipts
paid by such PPV Cable Subscriber and each PPV Satellite Subscriber to
Affiliate. "Network Share" shall equal the applicable Revenue Share
Percentage (as defined in Section 5(d)) of the Gross Receipts paid by each
such subscriber (but not less than ***** per PPV Cable Subscriber or PPV
Satellite Subscriber, and ***** for each VOD transaction), except that
such amount paid by each PPV Cable Subscriber or each PPV Satellite
Subscriber (as the case may be) shall be subject to reduction as provided
in Section 5(f) below.
22. Section 5(d) of the Agreement is deleted in its entirety and replaced with
the following:
(d) For purposes hereof, "Revenue Share Percentage" shall mean
*****.
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Notwithstanding the foregoing, Revenue Share Percentage shall mean
***** effective upon the first date upon which Affiliate offers both
(A) at least ***** of the TV-SVOD Content in connection with a
subscription to the Service in systems comprising at least ***** of
the basic cable television subscribers within Systems that offer
adult content on a VOD basis (i.e., VOD content that is rated X or a
more explicit editing standard, other than such VOD content that is
included as part of an SVOD offering from a premium service provider
not targeted exclusively to adult audiences (e.g., Cinemax,
Showtime)) (such systems, the "Adult VOD-Enabled Systems"), and the
parties agree that the number of basic television subscribers in the
Adult VOD-Enabled Systems shall be deemed to be *****, and (B) at
least ***** of the VOD Content (including such VOD Content delivered
by Spice Entertainment, Inc. ("Spice") to Affiliate pursuant to the
Spice Agreement) offered, at a minimum, via a branded interface
(i.e., the name "Playboy" or "Spice," but not necessarily using a
logo) in systems comprising at least ***** of the basic cable
television subscribers within the Adult VOD-Enabled Systems ((A) and
(B) together, the "Carriage Incentive Benchmarks"); provided,
however, that if a System offers at least ***** of the TV-SVOD
Content and such System ***** offers at least ***** of the VOD
Content before *****, then the Revenue Share Percentage shall mean
***** upon the first date that Affiliate offers both at least *****
of the TV-SVOD Content and offers at least ***** of the VOD Content
(whether this occurs in a single System or as a combination of two
separate Systems), provided further, however, that if Affiliate
fails to achieve the Carriage Incentive Benchmarks on or before
*****, then the Revenue Share Percentage shall be deemed to be *****
between *****, and Affiliate shall be required to remit to Network
outstanding amounts retroactive to ***** for those Systems that are
not offering at least ***** of the TV-SVOD Content in connection
with a subscription to the Service, or at least ***** of the VOD
Content (including such VOD Content delivered by Spice) as of *****.
23. Section 5(e) of the Agreement is deleted in its entirety and replaced with
the following:
(e) The Fees that are attributable to Gross Receipts based on
Subscription services payable by Affiliate to Network hereunder
shall be due and payable forty-five (45) days after the end of the
calendar month to which they relate. The Fees that are attributable
to Gross Receipts based on PPV or VOD services payable by Affiliate
to Network hereunder shall be due and payable forty-five (45) days
after the last day of the calendar month which includes the last day
of the Reporting Period. The term "Reporting Period" shall mean the
days from the end of each System's or Satellite distributor's prior
monthly reporting period (which date may vary in each System or for
each Satellite distributor from the 20th of the calendar month to
the last day of the calendar month) to the end of the System's or
Satellite distributor's then current
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monthly reporting period. Affiliate shall have the right, however,
to make adjustments to any month's payment in an amount equal to the
portion of a previous month's Fees which represent an overpayment or
underpayment.
24. The following is added as a new penultimate sentence to Section 5(f) of
the Agreement: "Gross Receipts attributable to purchases of VOD Content or
HVOD Content shall be equal to the total amount of per-viewing fees billed
by Affiliate to the VOD subscribers for viewing of the VOD Content or HVOD
Content, less any technical credits given by Affiliate to such subscribers
pursuant to this Section. In the event of a substantiated, technological
failure within the transmission system for delivering VOD Content or HVOD
Content to subscribers resulting in the substantial interruption or
termination of an exhibition of a Program, Affiliate may, in its
discretion, offer a technical credit to the subscriber affected thereby
not to exceed the amount charged to the affected subscriber and shall
maintain documentation in support of the granted technical credit."
25. The phrase "PPV Satellite Fees, PPV Cable Fees, Service Satellite Fees and
Service Cable Fees" is deleted in its entirety from Sections 5(g) and 5(h)
and replaced in each instance with the term "Fees".
26. Section 6(a) of the Agreement (including Sections 6(a)(i) through
6(a)(iv)) is deleted in its entirety and replaced with the following:
(a) For all Reporting Periods, Affiliate shall send to Network along
with the payments, if any, due under Section 5 hereof, informational
statements. Each statement shall set forth information necessary to
the calculation of the Fees and Renewal Fees paid, including but not
limited to the following:
i. the total number of PPV purchases for the applicable month;
ii. the average number of Service Cable Subscribers and Service
Satellite Subscribers for the applicable month;
iii. to the extent necessary to determine the Fees payable by
Affiliate, the number of basic cable television subscribers
served by Adult VOD-Enabled Systems, and the number of Adult
VOD-Enabled Systems offering the VOD Content and/or the SVOD
Content in connection with a subscription to the Service for
the applicable month;
iv. Service Satellite Subscribers' usage of individual Programs
comprising the SVOD service for the applicable month, if
available; and
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v. the total number of VOD purchases, and the names of the titles
(or other appropriate identifier) for each VOD purchase, for
the applicable month.
27. Sections 7(a) and 7(b) are deleted in their entirety and replaced by the
following: "Deleted without implication."
28. The contact information in Section 7(d) of the Agreement shall be replaced
in its entirety and replaced with "President, Playboy Entertainment Group,
Inc., 2706 Media Center Drive, Los Angeles, CA 90065."
29. In Section 7(e) of the Agreement, in the second sentence, the last part of
the sentence, which begins "Network shall pay to Affiliate ***** of Net
Sales receipts..." shall be deleted, along with the balance of the
paragraph and replaced with "Network shall make available ***** of
commercial time per hour to Affiliate for Affiliate's use." Additionally,
at the end of the revised paragraph, the following language shall be
inserted: "With the exception of the ***** per hour granted above, the
Service shall not contain any advertising, including but not limited to
audio text services, merchandise sales, Internet services and other such
products. Notwithstanding the foregoing, during the "breaks" between
movies and/or other programs, the Service may contain the following audio
text spots: (x) if the break is less than or equal to ***** in length,
audio text spots not exceeding ***** in the aggregate during such break;
and (y) if the break is greater than ***** in length, audio text spots not
exceeding ***** in the aggregate during such break; provided that, in
either case, Network shall not interrupt any programming to air the audio
text spots, and each audio text spot shall be accompanied by a visual (if
not moving video) element. In addition, Network shall be permitted to
refer viewers to Network's and its affiliated companies' websites for
scheduling information regarding the Service and may refer generally to
the websites (e.g., "Visit our website at Playboy.com"); provided that,
such referrals shall not contain any advertising, promotions or sales."
30. The following language shall be added to the end of Section 7(g),
"provided that Network shall not be restricted from making incidental
references to other services affiliated with Network as part of Network's
regular programming."
31. The following language is hereby added as Section 7(i) of the Agreement:
(i) Marketing. Upon the date, if ever, that Affiliate achieves the
Carriage Incentive Benchmarks:
A. ***** Affiliate, not later than ninety (90) days
following the end of a calendar year, written
certification demonstrating Network's compliance with
this Section 7(i)(A) with respect to such calendar year.
B. In addition, Network will, *****. To the extent Playboy
desires to
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identify a distributor of the Service (including
Affiliate or any Comcast entity) in any such *****.
C. Network represents and warrants that any advertising and
promotional materials that Network provides and
Network's publication of such advertising and
promotional materials will not (a) create liability for
Affiliate; (b) infringe upon or violate a third party's
intellectual property rights or rights of publicity or
privacy; (c) violate any law, statute, ordinance or
regulation; (d) be defamatory, libelous, illegally
threatening or harassing; (e) contain obscenity,
pornography or otherwise be inflammatory; or (f) in any
way violate this Agreement. Affiliate reserves the right
to require Network to remove or revise any advertising
and promotional materials, as Affiliate deems necessary
or appropriate if, in Affiliate's absolute discretion,
the materials or publication of the materials is likely
to violate any of the representations and warranties in
(a) through (f) above. In the event that Affiliate
exercises the foregoing rights to require Network to
remove any advertising or promotional materials, Network
will, at Affiliate's option, promptly remove such
materials or promptly remedy the defect that prompted
the request for removal.
32. The following language is hereby added as Section 7(j) of the Agreement:
(j) In consideration for the provisions set forth in Section 5(d) of
this Agreement, upon or after the date, if ever, that Affiliate
achieves the Carriage Incentive Benchmarks, then, at Affiliate's
request, Network will *****. The date and time of the party are to
be mutually agreed upon by the parties.
33. The Affiliate contact information at Section 11 of the Agreement is
deleted in its entirety and replaced with the following contact
information:
To Affiliate: Satellite Services, Inc.
c/o Comcast Cable
1500 Market Street
Philadelphia, PA 19102
Attention: Senior VP, Programming
With a copy to:
Comcast Cable
1500 Market Street
Philadelphia, PA 19102
Attention: General Counsel
To Network: Playboy Entertainment Group, Inc.
2706 Media Center Drive
Los Angeles, CA 90065
Attention: President
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With a copy to:
Playboy Enterprises, Inc.
680 North Lake Shore Drive
Chicago, IL 60611
Attention: General Counsel
34. Section 13(b) of the Agreement is deleted in its entirety and replaced
with the following:
(b) In the event that (i) Network acquires or otherwise obtains
operating control of, any programming service other than the Service
(an "Other Service"), and (ii) such Other Service is merged into, or
otherwise combined with, the Service, in each case so that there is
only one surviving service, then (a) if the Service is the surviving
service, then this Agreement shall remain in full force and effect
and any agreement concerning distribution of the Other Service shall
be terminated and the parties thereto shall be discharged of any
further obligations and/or liabilities thereunder as of the date of
such merger or combination; or (b) if the Other Service is the
surviving service in such merger or combination, (x) if Affiliate
has (at the time of such merger, combination, or acquisition) an
affiliation agreement concerning distribution of the Other Service,
then such affiliation agreement for the Other Service shall remain
in full force and effect, and this Agreement shall be terminated and
the parties hereto shall be discharged of any further obligations
and/or liabilities hereunder as of the date of such merger, or (y)
if Affiliate does not have an affiliation agreement concerning
distribution of the Other Service, then Affiliate shall have the
option to elect to have this Agreement continue to apply to such
Other Service or to negotiate a new agreement to apply to such Other
Service. In the event that Network acquires or otherwise exercises
operating control over an Other Service, and such Other Service is
not merged into, or combined with, the Service, then (A) this
Agreement shall not apply to the distribution of such Other Service,
and (B) Affiliate shall not be entitled, by virtue of such merger or
combination, to distribute the Service under any agreement governing
Affiliate's distribution of such Other Service.
35. The first sentence of Section 13(c) of the Agreement shall be deleted in
its entirety and replaced with the following:
This Agreement, as amended, contains the entire understanding of the
parties and supersedes and abrogates all contemporaneous and prior
understandings of the parties, whether written or oral, relating to
the subject matter hereof, including that certain prior agreement
between Comcast Programming and Playboy Entertainment Group, Inc.
made as of October 1, 1999, as amended, which expired September 30,
2004 (the "Prior Comcast Agreement").
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36. The following phrase in the first sentence of ***** shall be deleted:
*****
Additionally, the following sentences are hereby added to the end of Section
13(f) of the Agreement:
Affiliate acknowledges that it is specifically granted the terms of this
Section 13(f) in consideration for the provisions set forth in Section
5(d) of this Agreement. Additionally, Affiliate hereby agrees that, in
consideration for the Fees granted pursuant to this Agreement, as amended,
Affiliate shall *****.
37. The following language is hereby added as Section 13(l) of the Agreement:
(l) No Press Releases. Neither party shall issue any press release,
announcement or statement to the public or any third party regarding
the business relationship of the parties as set forth herein or the
transactions described in this Agreement without the advance written
consent of the other party, except to the extent such disclosure or
statement is required by law.
38. The following language is hereby added as Section 13(m) of the Agreement:
(m) Release of Claims. Network, on behalf of itself, its parent,
subsidiary and other affiliated companies and each of their
respective officers, directors, employees, partners, agents,
shareholders, representatives, successors, predecessors and assigns
(collectively, the "Network Releasing Parties") hereby voluntarily
and forever completely remises, relinquishes, releases and forever
discharges Affiliate, its parent, subsidiary and affiliated
companies and each of their respective present and former officers,
directors, employees, partners, agents, shareholders,
representatives, successors, predecessors and assigns (collectively,
the "Affiliate Released Parties"), of and from any and all claims
(including claims for conversion liability), demands, losses,
penalties, costs, expenses (including, without limitation,
reasonable attorneys' fees), interest, damages, actions, causes of
action and liabilities, whether at law or in equity, whether based
on contract, statute, tort, or strict liability, and whether for
compensatory, special, punitive, statutory or any other damages or
remedies, whether known or unknown, accrued or unaccrued, foreseen
or unforeseen, contingent or non-contingent, direct or indirect,
whether heretofore asserted or not, or arising by assignment,
operation of law or otherwise, that are based on, connected to,
arising out of or related to the payment, alleged failure to pay or
alleged liability for the payment of any Fees, Renewal Fees, license
fees or any other charges or payments whatsoever by Affiliate on
account of the Systems to Network for the Service (including any
feeds or multiplex signals thereof) for the period prior to, and
including, *****. Network shall indemnify, defend, and hold the
Affiliate Released Parties harmless from and against any claim
brought by a Network Releasing
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Party, and/or by any person or entity, under any actual or purported
assignment, subrogation or other right of substitution by or under a
Network Releasing Party, against an Affiliate Released Party
relating to the claims released in this Section 13(m), and Network's
indemnification shall be subject to the provisions of Sections 8(h)
herein.
39. Exhibit A shall be deleted in its entirety and replaced with Exhibit A
attached hereto.
40. Exhibit B-1 (Programming Schedule) shall be deleted in its entirety and
replaced with Exhibit B-1 (Programming Schedule) attached hereto.
41. The parties acknowledge that those systems distributing the Service, as of
September 30, 2004, pursuant to that the Prior Comcast Agreement, as
amended, were added to the Agreement as of October 1, 2004.
AGREED TO AND ACCEPTED BY THE PARTIES AS OF THE LAST DATE WRITTEN BELOW.
PLAYBOY ENTERTAINMENT SATELLITE SERVICES, INC.
GROUP, INC.
By: /s/ James F. Griffiths By: /s/ Jennifer T. Gaiski
Name: James F. Griffiths Name: Jennifer T. Gaiski
Title: President Title: Vice President, Programming
Date: 9/26/05 Date: 9/26/05
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EXHIBIT A
to
Affiliation Agreement
by and between
Playboy Entertainment Group, Inc.
and
Satellite Services, Inc.
dated as of February 10, 1993, as amended
SYSTEM QUALIFICATIONS
Affiliate represents and warrants that, with respect to each System listed on
Schedule 1 hereto, Comcast Corporation, or any person or entity controlling,
controlled by, or under common control with Affiliate or Comcast Corporation,
now or hereafter (Affiliate, Comcast Corporation and each such person or entity
a "Comcast Entity"), (i) owns or has the right to acquire ownership of, directly
or indirectly, a minimum of ***** of such System; and (ii) with respect to
Systems that are less than ***** owned, has been authorized to execute decisions
on behalf of such System with respect to the Service. In the event Affiliate's
direct or indirect equity interest in a System or in the entity managing such
System decreases below the level required by the immediately preceding sentence,
and provided Affiliate's interest does not decrease to zero, such System shall
continue to qualify for inclusion on Schedule 1 as long as Affiliate's interest
in such System increases to the level required hereunder within eighteen (18)
months of such decrease. In the event Affiliate, or any of the entities that
owns or manages systems or enterprises that qualify hereunder, effects a
corporate separation, reorganization or restructuring (including, without
limitation, by a distribution of stock, or other assets or rights, to its
shareholders, partners or joint venturers), the systems or enterprises of the
entity resulting from such transaction (including all interim and supporting
entities) and/or all of such resulting entities, in the aggregate, will qualify
under the system qualifications set forth herein, so as to continue to qualify
to distribute the Service under the terms and conditions hereof, as if such
separation, reorganization or other restructuring had not occurred.
15