Distribution Agreement
Category: Entertainment Agreements
5) Licensing & Fees
a)
Network will provide Company with an initial 60 hours of Content as follows: 30 hours in month #1, and an additional 30 hours in month #2, and will continue to deliver Content on a monthly basis as specified in Section 10 below.
b)
Individual Titles as listed in Appendix A and provided by Network will be available for Company usage, as defined herein, for one year, limited to the three-year term of this agreement. Upon expiration of individual titles, Company may continue usage of expired titles as “New Content” as required in Paragraph 10 below, to maintain programming needs.
c)
For all rights described herein, Company will pay Network a licensing fee of $150,000 annually for three years, for a total licensing fee of $450,000, to be paid as follows:
i)
$25,000 upon the Effective Date of this Agreement for the initial 60 hours of Content, and
ii)
$12,500 in monthly installments beginning the second month from the time content initially airs, not to exceed thirty (30) days from initial delivery date, and continuing for each of the remaining 34 months of the Term as defined in point 7 below.
d)
Upon the Effective Date of this agreement, Company will pay Network $12,500 to be deducted from the final payment of year 3, and $12,500 upon receipt of the first 60 hours of content.
6) Advertising and Merchandising Revenue:
The Parties agree that all Advertising Revenue derived as a result of this agreement shall be retained by Company. Merchandising Revenue shall not be included in this agreement, and any Merchandising ventures desired to be undertaken by the Company to create, license or sell merchandise in relation to the Content being distributed by Company shall be negotiated with Network separately.
a)
“Advertising Revenue” shall mean gross commercial advertising revenue (less applicable agency commissions) actually received from the insertion of Commercial Spots.
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b)
“Merchandise” shall mean a videocassette and/or DVD of any kind, or any other product based on the Content or bearing Network’s Marks.