270 Legal [Sample Agreements]

MASTER DISTRIBUTION AGREEMENT

This MASTER DISTRIBUTION AGREEMENT (“Agreement”) is entered into as of May 25, 2007 by and between Lions Gate Films Inc., a Delaware corporation (“Distributor” or “LGF”), and LG Film Finance I, LLC, a Delaware limited liability company (“FilmCo”). Capitalized terms not otherwise defined herein shall have the meanings set forth in Schedule A hereto, the terms of which are hereby incorporated by reference.

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2. GRANT OF RIGHTS.

2.1 FilmCo hereby grants and licenses to Distributor, as of the date on which FilmCo acquires a Funded Picture, the sole and exclusive, irrevocable (except to the extent expressly set forth herein) right, under copyright and otherwise, to advertise, publicize, promote, market, access Physical Properties, distribute, subdistribute, license and sublicense, and otherwise use and/or Exploit all of the Distribution Rights owned or controlled by FilmCo with respect to such Funded Picture in all media now or hereafter known or devised by any manner or method now known or hereafter devised in the Distribution Territory for such Funded Picture, during the Term. FilmCo shall not exercise any of the rights granted to Distributor prior to a Distribution Termination Event and shall not release or disclose any information, advertising or publicity relating to any Funded Picture in the Distribution Territory without Distributor’s prior written approval.

2.2 Distributor and FilmCo acknowledge and agree that this Agreement evidences the grant of a license of the Distribution Rights to each Funded Picture acquired by FilmCo under the Master Picture Purchase Agreement. If the license granted under this Agreement is characterized as anything other than a license of the Distribution Rights from FilmCo to Distributor, and so long as Distributor has any Distribution Rights granted hereunder, Distributor will nevertheless make all payments required under this Agreement and will otherwise comply with its obligations hereunder, it being agreed that the making of such payments and the compliance with such obligations by Distributor are essential elements of the transactions evidenced by this Agreement and the other Transaction Documents. The parties acknowledge and agree that the Distribution Rights and license granted under this Agreement by FilmCo to Distributor do not and shall not be deemed to be a sale by FilmCo of the Funded Pictures or of the Distribution Rights thereto.

3. EXPLOITATION OF DISTRIBUTION RIGHTS.

3.1 Subject to the other terms hereof, including Section 10.3.3., Distributor shall have the sole right, in its sole discretion to make all decisions concerning the Exploitation of the Rights in each Funded Picture, including the right to release and distribute (and/or refrain from releasing and distributing) each Funded Picture in any manner and media, and through such releasing or distribution entity or entities (and/or to engage such subdistributors or licensees) as it determines in its sole discretion. Without limiting the foregoing (but subject in each instance to any restrictions on the Distribution Rights as acquired by FilmCo under the Master Picture Purchase Agreement), Distributor may, without limitation:

3.1.1 at its sole discretion, prepare closed-captioned versions of the Funded Pictures and use excerpts, clips and trailers thereof for advertising and promotional purposes;

3.1.2 incorporate onto Videograms of a Funded Picture (A) preceding and/or following the main and end titles of such Funded Picture, Distributor’s or any of Distributor’s, sublicensees’, affiliates’ and affiliated licensees’ names, trademarks, logos, trailers, clips, (B) excerpts of other Motion Pictures, (C) Distributor’s standard “opening” and “closing” sequences, including an introductory visual “logo” with or without music, (D) any legal notices or other information which Distributor determines is necessary, (E) paid advertising provided monies received from such paid advertising shall be included in Gross Receipts, (F) any so-called “making of” or “behind the scenes” documentary footage or programming, including, without limitation, any part of the electronic press kits, featurettes, interviews, television specials and publicity clips prepared in connection with such Funded Picture, and (G) such other materials or credits as it, in its sole discretion, deems appropriate;

3.1.3 incorporate trailers, clips or excerpts of a Funded Picture on Videograms of other Motion Pictures and may incorporate trailers, clips or excerpts of other motion pictures on Videograms of a Funded Picture;

3.1.4 have the right, at its sole discretion, to make any and all changes and modifications, edits, or additions in or to a Funded Picture (including its title) which Distributor shall determine to be necessary or desirable including by reason of censorship, registration (i.e. ratings) or other requirements of governmental or other authorities or Law, or platform requirements, all at FilmCo’s sole cost and expense as part of the Distribution Costs and Expenses of such Funded Picture. FilmCo agrees to cooperate with Distributor as required for Distributor to clear customs, registrations and censorship or similar authorities and any fees associated therewith shall be part of the Distribution Costs and Expenses of such Funded Picture. Distributor shall have the right to select, designate or change the title of a Funded Picture in its discretion and to release or not release such Funded Picture in any or all parts of the Distribution Territory for such Funded Picture under such title or titles as Distributor may designate;

3.1.5 include Distributor’s (or one or more of Distributor’s or any of Distributor’s sublicensees’, affiliates’ and affiliated licensees’ names) name, logo, trademark or emblem in such manner, position, form and substance as Distributor may elect on the prints of the Funded Pictures, and on all advertising and publicity materials for the Funded Pictures (including any trailers of the Funded Pictures), together with such words as Distributor may elect indicating that such Funded Pictures are being distributed by Distributor or any of Distributor’s sublicensees’, Affiliates’ and affiliated licensees’ names, and

3.1.6 allow any of the foregoing rights to be exercised by or grant any of the foregoing rights to a sublicensee or an affiliate.

3.2 Release Obligations.

3.2.1. Notwithstanding Section 3.1, Distributor shall cause the Theatrical Exhibition in the United States of each Funded Picture, and, provided, further, that:

(a) of the first twenty-three (23) Funded Pictures Delivered to Distributor, a minimum of ***** (to be determined by Distributor in its sole discretion) shall be Theatrically Exhibited in the United States on at least ***** screens, provided that, in the event that less than twenty-three (23) Funded Pictures are Delivered to Distributor during the Contribution Period as a result of a FundCo Default or a Permitted FundCo Non-Contribution, the thirteen (13) Funded Picture requirement shall be adjusted downward pro-rata based on the total number of Funded Pictures actually Delivered to Distributor during the Contribution Period; and

(b) Distributor shall, on a picture-by-picture basis, spend at least ***** Dollars ($*****) in P&A Costs on the Theatrical Exhibition in the United States of a minimum of ***** of the first twenty-three (23) Funded Pictures the Distribution Rights for which are granted to Distributor hereunder, provided that, in the event that less than twenty-three (23) Funded Pictures are Delivered to Distributor during the Contribution Period as a result of a FundCo Default or a Permitted FundCo Non-Contribution, the ***** Funded Picture requirement shall be adjusted downward pro-rata based on the total number of Funded Pictures actually Delivered to Distributor during the Contribution Period.
The obligations described in this Section 3.2.1 are the “Release Obligations.”

3.2.2 With respect to each Funded Picture, Distributor shall notify FilmCo if the Initial Theatrical Release Date of such Funded Picture does not occur within ***** days of the Initial Investment Date for such Funded Picture.

3.3 Services Included Without Additional Cost. Distributor shall provide to FilmCo, directly or through its Affiliates, distribution services and facilities as it and its Affiliates historically have provided in the distribution of Motion Pictures acquired or produced by LGF or its Affiliates, and agrees that it shall utilize the distribution services and facilities of LGF and/or its Affiliates (rather than Third Party services and facilities) to the same extent it would generally utilize such services and facilities for other Motion Pictures of LGF or its Affiliates. FilmCo acknowledges and agrees that such distribution services and facilities provided by Distributor and its Affiliates to FilmCo shall vary from Funded Picture to Funded Picture. Distributor shall not charge Purchaser any overhead of LGF or an Affiliate or add to any invoice any overhead of LGF or an Affiliate.

3.4 Copyright Protections and Notice. Distributor shall take all actions reasonably sufficient to secure copyright protection for each Funded Picture throughout the applicable Distribution Territory for such Funded Picture in a manner consistent with its past practice for its own Motion Pictures. Distributor shall register for copyright the Motion Picture in the United States Copyright Office if not previously registered. All such costs and expenses shall be a Distribution Cost and Expense. Distributor shall include in the Funded Pictures in the forms and media distributed by it a copyright notice in conformity with the Laws of the United States and the Universal Copyright Convention designating FilmCo as copyright proprietor.
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