EXHIBIT 10.15
AMENDMENT #2 TO IGNITE LLC/LIONS GATE FILMS, INC. AGREEMENT
OF FEBRUARY 15, 2001
Amendment made as of this 13th day of May, 2002 between Ignite LLC and
Lions Gate Films, Inc.
Reference is hereby made to the February 15, 2001 Agreement between Ignite
LLC and Lions Gate Films, Inc. (the "Agreement").
Section 2.c. shall hereby be deemed deleted from the Agreement and the
following shall hereby be inserted into the Agreement in its place.
2.c. FEES TO IGNITE LLC. Any Project optioned, acquired or developed by the Fund
and subsequently produced by the Company shall result in:
(i) FLAT FEE: A flat fee ("Producing Fee") equal to $150,000 being paid
to Ignite LLC, on a 20/60/10/10 basis, increasing at a rate of 15%
per Project produced hereunder on an annual basis (February to
February (the "Annual Period") with increase based on the basic
$150,000 such that it goes to $172,500 and then $195,000) with the
fee reverting back to $150,000 at the beginning of each succeeding
year; and
(ii) CASH-BREAKEVEN CONTINGENT COMPENSATION: Contingent compensation to
Ignite LLC as follows: (a) 2% of Gross Receipts at Cash-Breakeven up
to the amount which is two times the Producing Fee payable to Ignite
in connection with the subject Project; (b) thereafter, 2% of Gross
Receipts at Cash-Breakeven (inclusive of Breakeven Fees of 10%) up
to an additional amount which is equal to two times the Producing
Fee payable to Ignite in connection with the subject Project. In no
event shall the contingent compensation payable pursuant to this
subsection exceed a cap equal to four times the Producing Fee
payable to Ignite in connection with the subject Project. For
purposes of this Agreement, "Cash-Breakeven" shall be defined as
that point in time, if ever, when a sum equal to one hundred percent
(100%) of the Total Gross Receipts, less the "Breakeven Expenses"
and the "Breakeven Fees" (if any), both on an accrual and rolling
basis, equals zero. For purposes of this Agreement, "Breakeven
Expenses" shall mean all actual, direct, third party expenses
including, without limitation the negative cost of the Picture, all
P&A expenses related to the domestic release of the Picture, all
foreign distribution expenses, a reasonable reserve for residuals
and supplemental payments, home video marketing and duplication
costs, plus actual interest (on all of the foregoing except
reserves), creative participations actually paid and deferments
actually paid prior to Cash Breakeven. For purposes of this
Agreement, "Breakeven Fees" (if applicable) shall mean the specified
percentage of the Total Gross Receipts; and
(iii) AGR CONTINGENT COMPENSATION: Contingent compensation to Ignite LLC
equal to 15% of Lions Gate's Adjusted Gross Receipts (all gross
revenues received by or credited to Lions Gate, its parent,
affiliates and subsidiary companies arising from the
exploitation of the Project in any and all media (now known or
hereafter devised) after deduction by Lions Gate on a continuous
basis of (i) distribution fees calculated as follows: 20% of U.S.
Gross receipts and 20% of foreign receipts (provided that if Lions
Gate engages a third party distributor with respect to any foreign
territory, in no event shall the aggregate distribution fees exceed
35%); (ii) all actual third-party out-of-pocket distribution
expenses (including a reasonable reserve for guild residuals) plus
actual interest thereon; (iii) recoupment of Lions Gate contribution
to the negative cost of the Project (i.e., all costs related to the
development and production of the Project, specifically excluding
overhead charges or allocations) plus actual interest thereon; (iv)
all other mutually approved deferments paid to third-parties; and
(v) any Flat Fee and Cash-Breakeven Contingent Compensation amounts
paid or payable to Ignite LLC pursuant to subsections 2.c.(i) and
2.c.(ii) hereinabove.)
Ignite LLC shall receive fees and contingent compensation on any subsequent
production based on any Project as set forth herein. Notwithstanding the
foregoing, on any Project with a budget less than $3.0 million, the parties
hereto agree to negotiate Ignite LLC's fee in good faith. The Producer Fees are
for the exclusive benefit of Ignite LLC's shareholders.
ACCEPTED AND AGREED:
LIONS GATE FILMS, INC.
By: _________________________________
Its: _________________________________
IGNITE LLC
By: _________________________________
Its: _________________________________
