270 Legal [Sample Agreements]

AFFILIATION AGREEMENT

THIS AFFILIATION AGREEMENT (this “Agreement”), made as of the 22nd day of March, 2006 (“Effective Date”), is by and between The TUBE Music Network, Inc., a Florida corporation (the “Network”), and Sinclair Television Group, Inc., a Maryland corporation (“Affiliate), regarding the television programming service currently known as “The TUBE” (the “Service”). The parties hereby mutually agree as follows:

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3. GRANT OF RIGHTS; ACQUIRED STATIONS:

(a) Network hereby grants to Affiliate the exclusive right via Broadcast Television or via carriage of a Station by any MVPD serving the pertinent Licensed Community, and Affiliate hereby accepts such exclusive right and the obligation during the Term to broadcast the Service (i) over the transmission facilities of each Station identified on Exhibit A, which is licensed by the FCC to serve the community for each such Station (the “Licensed Community”), for receipt by TV Households in the DMA in which the Licensed Community is located, as such DMA is identified on Exhibit A, and (ii) subject to subparagraph (b) below, over the transmission facilities of any Acquired Station, except to the extent that, as of the date Affiliate notifies Network in writing of the closing of the acquisition of such Acquired Station, Network is already committed to provide the Service to another Broadcast Television station in the same DMA as the Acquired Station. Except for delays resulting directly from the failure of Network to provide the Receiving Equipment pursuant to Section 5(b), Affiliate shall launch the Service on each Station on or before the Launch Date set forth opposite each Station on Exhibit A. Affiliate shall telecast the Service solely from each Station’s origination transmitter and antenna for free over-the-air television reception. Notwithstanding the foregoing, Affiliate shall have the right to permit, and shall use good faith, commercially reasonable efforts to obtain, carriage of the Service’s signal by MVPDs in the DMA of each Station that transmits the Service, which Service signal shall be transmitted by Affiliate together with the Primary Feed; provided, however, that Affiliate shall not be in breach of its obligations hereunder if, after good faith negotiations, it does not reach agreement with any MVPD for the carriage of the Service due to unrelated issues, including compensation to be paid to Affiliate for the right to transmit the signal of the Station(s), and/or if Affiliate reaches agreement with such MVPD for carriage of broadcast streams that do not include the Service. Affiliate shall promptly notify Network of any MVPD that has agreed to retransmit the Service in the Station’s DMA. In the event Affiliate owns and/or operates more than one Station in any single DMA, then Affiliate, at its option, shall have the right to determine which of its Stations in such DMA shall broadcast the Service; it being understood that Affiliate shall have no obligation to broadcast the Service on more than one of its Stations in any particular DMA.

(b) If, during the Term hereof, Affiliate acquires an Acquired Station that is transmitting the Service in the DMA in which such Acquired Station is located at the time of such acquisition by Affiliate, then Affiliate shall continue to transmit the Service and, as of the effective date of such acquisition, the Acquired Station shall become a “Station” hereunder and any existing agreement between or among Network and any one or more third parties applicable to such Station for the transmission of the Service shall terminate and cease to be effective. If, during the Term hereof, Affiliate acquires an Acquired Station in a DMA that is not at such time under license by Network to a third party for transmission of the Service, then Affiliate, by notifying Network within sixty (60) days of the date of consummation of the assignment or transfer of the FCC license of the Acquired Station, may in its sole discretion request that Network add such Acquired Station as a “Station” to this Agreement and shall commence transmission of the Service within the DMA of such Acquired Station within such sixty (60) -day period. Upon receipt of such notice by Network, the Acquired Station shall be added to this Agreement unless, prior to receipt of Affiliate’s add notice, Network has committed to provide the Service to another Broadcast Television station or MVPD in the same DMA as the Acquired Station. For purposes of clarification, with regard to an Acquired Station in a DMA that is not at such time under license by Network to a third party for transmission of the Service, if Affiliate does not elect to add such Acquired Station to this Agreement within such sixty (60) -day period, then Network shall thereafter have the right to license the transmission of the Service to another broadcast television station or MVPD in such DMA, including on an exclusive basis.

(c) Except as expressly provided in Section 3(a) with respect to retransmission of the Service by an MVPD in a Station’s DMA, Affiliate shall not have the right (i) to subdistribute or otherwise sublicense the Service, or (ii) to transmit or otherwise distribute the Service by any technology (other than Broadcast Television), or on an interactive, time-delayed, “video-on-demand” or similar basis. For purposes hereof, “video-on-demand” means the transmission of a television signal by means of a point-to-point distribution system containing audiovisual programming chosen by a viewer for reception on a viewer’s television receiver, where the scheduling of the exhibition of the programming is not predetermined by the distributor, but rather is at the viewer’s discretion.

(d) Network hereby grants Affiliate during the Term a royalty-free, fully paid up, non-transferable, non-exclusive license to use the Marks (as that term is defined herein) in any advertising and promotional materials undertaken in connection with Affiliate’s transmission of the Service, provided that such use complies with the terms and conditions of Section 8(e).

(e) All licenses, rights and interest in, to and with respect to the Service, the elements and parts thereof, and the media of exhibition not specifically granted herein to Affiliate shall be entirely reserved to Network and may be fully exploited and utilized by Network without limitation. Provided that Affiliate is in compliance with its obligations hereunder, including its distribution obligations, Network agrees that, during the Term, Network shall not simulcast the Service in its entirety, or a substantial portion of the programming on the Service, over the Internet within the Licensed Community of any Station that is transmitting the Service pursuant to this Agreement. For purposes of clarification, a promotional or marketing “stunt” simulcasting a live or special event, or programming designed to increase or improve viewership of the Service shall not be prohibited by this Section 3(e).

(f) Within fifteen (15) calendar days of the execution of this Agreement, Affiliate shall complete and deliver to Network a notice of launch (in the form attached hereto in Exhibit B) for each Station (“Launch Notice”) and subsequently launch the Service on each Station listed on Exhibit A no later than the Launch Date set forth opposite each Station on Exhibit A (for each Station, the “Launch Date”). In addition, Affiliate shall promptly complete a Launch Notice for any Acquired Station that is subsequently added to this Agreement.

(g) This Agreement shall be subject to any and all bona fide rights, programming, scheduling or other restrictions or limitations contained in agreements between Network and suppliers (provided that Network has negotiated any such restrictions in good faith with such suppliers in arms-length transactions).

4. CONTENT OF THE SERVICE:

(a) Content. Throughout the Term, the Service shall be a professionally produced, advertiser-supported television service with programming generally consisting of music videos, related interstitial programming, promotions and commercial advertising. Subject to the preceding sentence, the selection, scheduling, renewal, substitution and withdrawal of any content on the Service shall at all times remain within Network’s sole discretion and control.

(b) Local Programming. Subject to Network’s policies and procedures, Affiliate, at its own cost, shall be provided with up to thirty (30) minutes per week on the Service for the insertion of locally produced programming that is complimentary to the Service and designed specifically to appeal to TV Households in the Licensed Community of the Station broadcasting such programming (“Local Programming”). For purposes of clarification, Local Programming may consist of programming produced or acquired by Affiliate for broadcast on some or all of the Stations. Affiliate acknowledges and agrees that Local Programming shall be broadcast in one block of time on the same day and at the same time each week, such day and time to be selected by Network, in consultation with Affiliate, it being agreed and acknowledged, however, that such time period will be between 12:00 p.m. and midnight prevailing local time. Local Programming shall not consist of or contain (i) programming that has received, or had it been rated would have received, an MPAA “X” or “NC-17” rating, or that would otherwise be considered obscene, indecent, profane, or excessively violent; or programming that would be patently offensive as measured by the community standards of the Licensed Community in which is displayed; (ii) pay-per-view movies or events; (iii) blackouts; (iv) surcharges; (v) promotion or marketing of “800,” “888,” “900,” or “976” telephone services, or other similar services that bill a caller for placing or confirming the call (other than for the telephone company’s cost of the call); or (vi) infomercials, home shopping, direct on air sales programming or advertising; provided, however, such prohibition is not intended to limit sales of products and services directly related to the Network (i.e., sales of Network merchandise). Affiliate shall be solely responsible for the insertion on a timely basis of the Local Programming into the signal of the Service at the Stations transmitting the Service. The production quality of the Local Programming shall be at least comparable to the production quality of the Service transmitted by Network.

(c) Preemption. Notwithstanding anything herein to the contrary, Affiliate shall retain the right to elect not to transmit any programming on the Service over the broadcast facilities of a Station if (i) the transmission of such programming would cause such Station to be in default of its contractual obligations with the primary television network with which such Station is affiliated with regard to its Primary Feed (e.g., ABC, CBS, NBC, Fox, WB, CW and UPN) (individually and collectively, “Primary Network”), (ii) Affiliate reasonably believes in good faith that the transmission of such programming is contrary to applicable rules and regulations of the FCC and that such transmission would result in a penalty or forfeiture being imposed by the FCC on Affiliate or such Station (subsection (ii) hereof, an “FCC Preemption”), or (iii) as a result of an unexpected failure of equipment used by such Station in the transmission of its Primary Feed, the equipment that normally would be used by such Station to transmit the Service must be utilized temporarily in connection with the transmission of its Primary Feed, provided that in each case (A) Affiliate notifies Network either before or, if prior notification is impossible, as soon as reasonably practicable after Affiliate exercises such right, (B) Affiliate does not exercise such right in a manner intended to frustrate its obligations or Network’s rights hereunder, (C) such preemption is limited to the greatest extent possible, (D) Affiliate does not exercise such right arbitrarily, or as a consequence of a dispute with Network, and (E) Affiliate uses commercially reasonable efforts to remedy the cause of such preemption as soon as commercially practicable.

(d) Children’s Programming.

(i) Network will provide as part of the Service an amount of core educational and informational children’s programming as defined by FCC rules, including 47 C.F.R. §73.671, as the same may be amended from time to time (“Core Children’s Programming”) sufficient to satisfy the minimum Core Children’s Programming hours required to meet the FCC’s benchmark for such programming incurred by Affiliate as a result of the broadcast by the Stations of the Service on each such Station’s free, over-the-air, multicast feed, if and solely to the extent required by applicable FCC rules and regulations. Provided Network has been granted the rights to broadcast the Core Children’s Programming on a Station’s Primary Feed by all pertinent programming providers and Network may exercise such rights at no additional cost or expense to Network, Affiliate may simulcast or rebroadcast the Core Children’s Programming on the pertinent Station’s Primary Feed. In addition, Affiliate agrees to notify Network in the event Affiliate elects to meet the Core Children’s Programming requirements resulting from its Stations’ free, over-the-air multicast feeds on a single free, over-the-air multicast feed in which case Network’s obligations shall thereafter cease.

(ii) Network represents and warrants that if it supplies to Affiliate any programming produced primarily for children 12 years old or younger, such programming shall comply with the FCC’s commercial limits, including 47 C.F.R. §73.670, as the same may be amended from time to time, including limits on the amount of commercial matter and the prohibition on certain commercial matter in both the program material and commercial material, provided that each Station passes through such programming without alteration.

(iii) At the end of each calendar quarter, Network will provide to Affiliate a certification indicating the amount of Core Children’s Programming made available to Affiliate during the quarter and certifying that any programming produced primarily for children 12 years old or younger, as provided by Network, complied with the FCC’s rules on commercial limits.

(e) Advertising. Except for the Local Advertising, Network shall have the exclusive right and authority to sell all of the advertising on the Service and shall share a portion of Network’s Advertising Revenue generated from such sales with Affiliate in accordance with the terms of this Agreement.

(f) Program Service Information. Network must provide to a reputable program information services entity a program schedule for the Service.

(g) Closed Captioning. Network shall provide closed captioning for the Service if and solely to the extent required by applicable FCC rules and regulations.
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