Exhibit 10.21
LICENSE AGREEMENT
THIS LICENSE AGREEMENT ("Agreement") is entered into as of the 21st day of
July, 1999, by and between COLORADO SATELLITE BROADCASTING, INC., 00000 Xxxxxx
Xxxxxx Xxxx, Xxxxxx Xxxxxx, Xxxxxxxxxx 00000 (hereinafter referred to as "CSB"
or "Licensee") and METRO GLOBAL MEDIA, INC. on behalf of itself and its wholly
owned subsidiary. METRO, INC., 0000 Xxxx Xxxxxx, Xxxxxxxx, Xxxxx Xxxxxx 00000
(hereinafter collectively referred to as "Licensor").
W I T N E S S E T H
WHEREAS, CSB owns and operates networks for exhibition of audio visual
material over all forms of cable or satellite television, including basic cable
television, pay and subscription television, pay-per-view and satellite
transmission. Additionally, CSB is in the process of developing networks for
exhibition or transmission over various forms of Internet or so-called Worldwide
Web for access by television or personal computers;
WHEREAS, Licensor is and for many years has been in the business of
producing and distributing motion pictures intended primari1y for the adult
market. Licensor currently owns the rights granted hereunder with respect to an
inventory of approximately 3,234 motion pictures which have been acquired and/or
produced by Licensor, or its affiliate companies; and
WHEREAS, it is the intention of the parties to enter into this Agreement
relating to all Catalog Pictures and New Releases (as defined below). The
Catalog Pictures and New Releases are collectively referred to as the Pictures.
The term "Internet", as used herein, shall refer to information transmitted via
a global computer network which is accessed via Internet Protocol (IP) codes and
viewed by an Internet browser.
IN CONSIDERATION of the mutual covenants herein contained, and for other
good and valuable consideration, the receipt and sufficiency of which are
acknowledged, the parties agree as follows:
1. DEFINITIONS
1.1. As used in this Agreement, certain capitalized terms not otherwise
defined in the body of the Agreement shall have the meaning as specifically set
forth in Addendum "A", which is incorporated herein by this reference.
2. GRANT OF RIGHTS
To the extent the grant by Licensor to CSB does not conflict with the
rights previously granted or reserved to a third party, and subject to the terms
and conditions hereof, and as set forth below, as to each and every Picture,
Licensor hereby grants to CSB the right and license under copyright to
broadcast, exhibit and/or display any and all versions of the Pictures over any
form of cable or satellite television and/or by way of any form of Internet
transmission, whether known or hereafter discovered. As used herein, the term
"versions(s)" shall describe the different editing of each Picture set forth in
the third sentence of Section 2.5 below:
CSB is hereby granted the following rights, the exclusivity or
non-exclusivity thereof to be determined as set forth in Section 6 below:
2.1. The right to distribute and publish the Pictures using all forms of
satellite, cable or Internet transmission to television sets, computer monitors
or other devices intended to receive exhibit audio visual images, whether now
known or hereafter discovered, including any and all forms of pay-television and
pay per view television, including CATV or cable television, any form of pay
television, pay-over-the-air television system, closed
circuit system, video on demand system, satellite master antenna television
system, DBS system (including, without limitation, KU-Band), hotel/motel system,
and any and all other Pay Television systems which exhibit motion pictures as
part of a Pay or Pay-Per-View Service. Such systems include, without limitation,
hotels, motels, inns, lodges, hospitals, nursing homes, convalescent homes,
offices, military bases, prisons, ships, oil rigs, dormitories and the like
carrying Pay or Pay Per View Service via satellite, cable or Internet
transmission. Notwithstanding the foregoing, it is acknowledged and agreed that
neither CSB nor any affiliate may sell or distribute copies of the Pictures as
standalone products to an OnCommand or Spectravision type service.
2.2. The method of exhibition of motion pictures and other programs over
television receivers where consumers purchase the right to view such motion
pictures or other programs on a fee-per-exhibition basis, in: (i)
non-residential institutions (including, without limitation, hotel or motel
rooms or hospital rooms or in other non-common or non-public areas of other
institutions, with transmission via either satellite, cable or Internet) is
referred to as "Non-Residential Pay-Per-View", and (ii) homes is referred to as
"Residential Pay-Per-View." The term "Pay-Per-View" when used herein shall
include both Residential Pay-Per-View and Non-Residential Pay-Per-View.
2.3. The rights to distribute and publish the Pictures via a "narrow band"
Internet service (i.e., below 56k "dial up" modem connections) and via a
"broadband" Internet service (i.e., 56k or above "dial up" modem connections)
and all forms of Internet transmission whether now known or hereafter discovered
(herein, the "Internet Rights").
2.4. The Television, Pay-Per-View and Internet Rights granted hereunder
include the rights to exhibit, broadcast, display and radio simulcast, all or
any portions of the Picture(s), including excerpts therefrom, and, to
subdistribute such rights, in all versions in and throughout the Territory;
provided that CSB may not, under any circumstances relicense individual Pictures
to third parties; and,
2.5. The right to make such edits, changes, alterations and modifications
in the Pictures, including changing the title of any Picture, as CSB, determines
in its sole discretion, is appropriate or necessary for time restrictions, to
comply with any applicable censorship requirements, to create new versions to
accommodate CSB's marketing plans or to take advantage of new opportunities to
market and exploit new and different versions of adult motion pictures in and
throughout the Territory in the media licensed to CSB hereunder; provided, that
CSB will not create any compilations of the Pictures for separate exhibition,
other than for promotional purposes or in connection with a multi-channel
Internet feed. Licensor shall deliver to CSB, the masters of all existing
versions of the Picture(s) plus any and all existing outtakes or cover shots,
wrap-arounds, director's cuts, interviews, production stills, artwork, etc., as
may be available, all in accordance with CSB's delivery requirements as set
forth in the addenda attached hereto. Licensor shall also provide CSB with
"behind the scenes" videos from the sets of the New Releases (as hereinafter
defined) during their production, in accordance with CSB's reasonable requests.
In all events, the masters to be delivered to CSB shall include at least a
fully-edited so-called XXX and a fully-edited so-called soft or cable versions,
if such version has been produced. In the event new versions are created
Licensor after delivery to CSB of XXX and Cable versions, including any versions
into any foreign language, Licensor agrees to immediately furnish CSB with
masters of such new or dubbed versions in accordance with the delivery
specifications set forth in the addenda attached hereto.
2.6. The rights granted to CSB hereunder shall include the right to create,
at its sole cost and expense, new, and different versions of the Pictures for
exhibition via satellite, cable or the Internet, as contemplated above. Such
derivative versions may constitute separately copyrightable derivative works of
Licensor and may include material only from the respective Pictures' XXX
versions, cable versions, outtakes and cover shots furnished by Licensor;
provided, that CSB will not create any compilations of the Pictures for separate
exhibition, other than for promotional purposes or in connection with a
multi-channel Internet feed. Such versions shall include so-called XX versions
to conform to the current standards of TEN (the erotic network), one of CSB's
affiliated systems. Such new versions shall be delivered to Licensor only upon
the termination of CSB's rights to such
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Pictures under this License Agreement and in such format as conforms to the
technical specifications set forth in the addenda attached hereto, and Licensor
shall pay CSB one dollar ($1.00) for each such picture. Other than the license
rights set forth herein, CSB shall have no rights to the derivative works so
produced.
2.7. The right to translate and dub the title and soundtrack of any and all
versions of the Pictures in any languages, and to distribute such dubbed
versions throughout the Territory.
2.8. The right to copy, in any form or medium which CSB determines
appropriate, the Pictures and to distribute such copies in the normal course of
CSB's satellite, cable or Internet business, such copies may be used for example
as screening cassettes, duplicate masters furnished to one or more television,
Pay-Per-View or Internet systems or copies to be used as promotional or
marketing materials in connection with CSB's business activities or those of its
licensees. Such copies may not be sold or distributed by CSB or any affiliate or
licensee of CSB to the public as a separate product, such as a VHS cassette,
CD-ROM or DVD disc.
2.9. The right to advertise and publicize the Pictures, their exhibition
and/or any exploitation of the Pictures contemplated hereunder. This right shall
include the right to use all or any portion of the Pictures in any medium or by
any means to advertise or publicize any of CSB's business activities.
2.10. In addition, whether or not any new video or film produced by
Licensor is licensed hereunder by CSB for satellite, cable or DBS broadcast, CSB
shall have exclusive Internet Rights (as detailed in Sections 2.1. and 2.3.
above) for all new videos and films produced by Licensor during the next five
(5) years, which rights shall commence upon the release of the respective video
or film and continue for five (5) years thereafter, subject only to Licensor's
right to use the pictures on its own web sites and Internet mall (which shall
also be exclusive to licensor for the 90-day period referred to in Section 6
below); and the further limitation that the Internet rights for all
non-heterosexual titles and the titles currently under license to Playboy
Enterprises shall be non-exclusive.
Hereinafter, all of the rights granted under this Section may be referred
to collectively as the "Rights."
3. TERM
3.1. This Agreement shall have a term of seven (7) years commencing on the
date of delivery of the first Picture to CSB pursuant thereto. Thereafter, CSB's
rights to the Catalog Pictures may be renewed on a non-exclusive basis for a
term of seven (7) additional years upon CSB's payment to Licensor of $400,000 in
cash or New Frontier common stock.
3.2. Notwithstanding the provisions of paragraph 3.1. hereof, as to New
Releases such Rights shall continue for a term of five (5) years commencing upon
the earlier of the date of the first exhibition of the Picture by CSB or ninety
(90) days after delivery of each such New Release to CSB. In addition, CSB shall
have the right to renew its rights for any of the New Releases for a term of
five (5) additional years upon payment to Licensor of an amount equal to twenty
five percent (25%) of the license fee paid hereunder for such Pictures.
4. TERRITORY
The territory in which Licensor may exercise each and all of the rights
granted herein shall be the territory of North, Central and South America
("Territory"), except that due to the nature of the Internet, the Internet
Rights granted herein are worldwide in scope. CSB's rights may be exercised in
any country in. and throughout the Territory, including their respective
territories and possessions.
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5. DELIVERY OF PICTURES TO CSB
5.1. All motion pictures released and still photographs published by
Licensor on or prior to June 30, 1999 are referred to herein as the "Catalog
Pictures". A list of 3,234 of those motion pictures setting forth their titles
is set forth on Exhibit A hereto. Licensor agrees to update the attached list
within 90 days to indicate therein the titles of all of the Catalog Pictures,
the dates on which they are expected to become available for use by CSB, their
dates of production and such other information as may be reasonably requested by
CSB. Any motion pictures acquired by Licensor on an individual or bulk purchase
basis (from and after July 1, 1999) shall not be considered "Catalog Pictures"
or "New Releases". In addition, Licensor will deliver such screening cassettes,
editing masters or other material as may be requested by CSB, to permit CSB to
evaluate and use the Catalog Pictures. CSB shall have the right to select as
many Catalog Pictures as it desires to exploit in the Territory.
5.2. Commencing in August 1999, CSB shall, to the extent available,
pre-select, on a monthly basis, as Pictures hereunder, up to three (3) new
motion pictures hereafter produced by Licensor or its affiliated companies each
month throughout the Term hereof, and Licensor shall make available to CSB for
such pre-selection no less than six (6) new motion pictures at a license fee of
$12,500 per title, which three (3) new motion pictures shall be in addition to
the two (2) "premier" titles which CSB has been licensing per month from
Licensor's "Gonzo", "Amazing", "Toxxxic" or similar collections at a license fee
of $3,000 to $5,000 a title. In addition, at such time as Licensor's existing
license agreement with Playboy Enterprises is terminated prior to its term, CSB
agrees to pre-select two (2) additional new motion pictures, to the extent then
available, at a license fee of $14,000 per title; provided, that: (i) at least
one of the two (2) additional new motion pictures is shot on film (as opposed to
video); and (ii) the two (2) additional new motion pictures are reasonably
visually distinctive from the other new motion pictures delivered to CSB that
month (e.g., have different directors, different stars, different story lines
and a different general look from the other delivered movies). If the Playboy
Enterprises contract expires pursuant to its terms, CSB agrees that its
obligation to pre-select additional new motion pictures shall relate to an
additional three (3), not two (2), additional new motion pictures, and all
references in the preceding sentence "two (2) additional new motion pictures"
shall be deemed to refer to "three (3) additional new motion pictures". All such
new motion pictures provided by Licensor to CSB are hereinafter referred to as
the "New Releases".
5.3. Upon receipt of delivery materials relating to each Picture hereunder,
including each New Release, CSB shall have a period of 3O days within which to
evaluate all such materials and determine whether they are acceptable to CSB.
CSB shall have the absolute right to reject any films submitted for technical
reasons or for reasons related to CSB's editing standards. If CSB's rejection is
for technical reasons, CSB shall promptly notify Licensor of the technical
defects in the material delivered and Licensor will remedy any and all such
defects, at no cost to CSB, within ten (10) days of receipt of such notice. If
CSB's rejection is for reasons related to its editing standards, Licensor will
replace the rejected Picture(s) within thirty (30) days after Licensor receives
notice of such rejection, with another Picture(s) in the same category as that
of the Picture rejected. It is acknowledged and agreed that to the extent that
any of the Pictures are of a general quality equivalent to Licensor`s current
CalVisa line of motion pictures, such Pictures shall be deemed to meet CSB`s
general quality standards.
6. EXCLUSIVITY
Except with respect to the pre-existing rights of third parties to the
Catalog Pictures, all still photographs within the "Catalog Pictures" and for
Licensor's rights relating to the Internet and Kiosk Transmission Service, as
further described below, each and all of the Rights granted to CSB hereunder
shall be exclusive to CSB during the Term and Licensor agrees to take all action
necessary to ensure that CSB is accorded the right to exploit such Rights
without interference from any third party.
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Licensor will retain exclusive Internet rights over the New Releases during
the first ninety (90) days following the release date of all New Releases,
except that CSB may use the New Releases on the Internet for promotional
purposes only (and not for commercial use or in connection with a multiple
channel feed). Thereafter, CSB shall have exclusive Internet Rights to the New
Releases for seven (7) years, subject only to Licensor's right to continue to
use the New Releases on its own web site and Internet mall. Notwithstanding the
foregoing, the Internet Rights granted to CSB shall be non-exclusive for the
non-heterosexual and Playboy Enterprises movies described in Section 2.10.
above; and, provided, further, that Licensor shall not be permitted to use the
Pictures to license or distribute to any independent third party provider of
Internet content a thousand channel or similar multiple feed or video on demand
product. Licensor may however, develop and market a Kiosk Transmission Service,
utilizing the Pictures wherein a retail customer selects a purchase of a Picture
in a recorded medium from a retail establishment's booth facility.
7. PAYMENT BY CSB
In full consideration of all of the Rights granted hereunder and each of
the terms and conditions of this Agreement, and conditioned upon Licensor's full
and faithful performance of all obligations to be performed hereunder, CSB
agrees to pay Licensor as follows:
7.1. CSB agrees to deliver to Licensor a total of 500,000 shares (the
"Catalog Shares") of restricted common stock of New Frontier Media, Inc. ("New
Frontier"), the parent company of CSB, and to cause the issue to Licensor
warrants to purchase an additional 100,000 shares of common stock of New
Frontier at Market (as hereinafter defined) or the date this Agreement is
executed, in the form attached hereto. In addition, and in further consideration
of the rights granted to CSB under Section 2.10. above, CSB and New Frontier
agree to issue to Licensor warrants to purchase an additional 100,000 shares of
common stock of New Frontier at Market on the first, second, third and fourth
anniversary of the execution date of this Agreement, in the form attached hereto
(for a total of 500,000 warrant shares). For the purpose of this Agreement, the
term "at Market" shall mean the average closing price for shares of common stock
of either New Frontier or Licensor, as applicable, for the ten (10) day period
immediately preceding the date such determination is made.
7.2. With respect to each New Release delivered to CSB hereunder and
accepted by CSB, CSB shall pay Licensor 25% of the license fee then due upon the
acceptance of the master for each such New Release and the balance within
seventy five (75) days thereafter.
7.3. In consideration of CSB's other obligations to Licensor hereunder, to
wit the delivery of IGallery's services pursuant to Section 14.3. below,
Licensor shall issue to New Frontier 250,000 restricted shares of its common
stock and warrants to purchase 50,000 restricted shares of its common stock at
Market (as defined above) on the date of execution of this Agreement. In
addition, on each of the first, second, third and fourth anniversaries of the
execution date Licensor shall issue to New Frontier warrants to purchase an
additional 50,000 shares of its common stock at Market (for a total of 250,000
warrant shares).
8. COSTS AND EXPENSES
8.1. Licensor shall he responsible for paying all production costs related
to the production of the Pictures.
8.2. As between Licensor and CSB, CSB shall be responsible for all
scanning, editing and duplication costs and making all payments which may be
required to be paid on account of CSB's exercise of its rights hereunder, except
to the extent such payments are the responsibility of Licensor, as set forth in
Section 8.1. above. Licensor shall lend CSB edit copies of the Pictures (for
which those produced after 12/96 shall conform to the technical specifications
attached hereto), which edit copies will be returned to Licensor after
duplication.
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9. CONFIDENTIALITY
Neither Licensor nor CSB shall disclose to any third party (other than
their respective employees, agents or representatives in their capacity as
such), any information with respect to the financial terms and provisions of
this Agreement except: (i) to the extent necessary to comply with law or the
valid order of a court of competent jurisdiction, in which event, the party
making such disclosure shall so notify the other, in writing, within five (5)
days, and shall seek confidential treatment of such information, (ii) as part of
its normal reporting or review procedure to its parent company, its auditors and
its attorneys, provided, however, that such parent company, auditors, and
attorney's agree to be bound by the provisions of this paragraph 9, (iii) in
order to enforce its rights pursuant to this Agreement, and (vi) to any bona
fide prospective purchaser of the stock or assets of such party.
10. REPRESENTATIONS AND WARRANTIES OF CSB
CSB hereby represents and warrants that it has the full power and authority
to enter into this agreement and to fully perform its obligations under this
Agreement, that the agreement is an enforceable and binding agreement, and that
it does not conflict with any other agreement or obligation of CSB. New Frontier
Media, Inc. has executed this Agreement for the limited purpose of acknowledging
its consent to the issuance of its restricted common stock and warrants to
Licensor.
11. REPRESENTATIONS AND WARRANTIES OF THE LICENSOR
Licensor hereby warrants and represents to CSB as follows:
11.1. Licensor owns all appropriate and necessary rights in and to the
Pictures which are the subject hereof to permit CSB to peacefully exercise each
of the Rights granted hereunder without interference from any third party and
without claim that such exercise constitutes a violation of the rights of any
third party, except for the pre-existing rights of certain third parties with
respect to cable and satellite distribution and certain identified Pictures for
which Licensor may not have acquired the Internet Rights. Licensor represents
and warrants that when it delivers to CSB the updated schedule of Pictures
contemplated by Section 5.1. above, the schedule will contain a listing of all
available rights and that it will indicate that no less than 2,250 Pictures
shall have been licensed hereunder to CSB with complete video on demand and
Internet Rights. The Licensor guarantees to CSB that each of the Pictures was
produced in compliance with all applicable laws, that all actors and actresses
in the Pictures were over 18 years of age when they rendered their performance,
and that all Documentation, including but not limited to, proper age/consent
documents are maintained on file as required by law and may he inspected by CSB
or its designated agent during normal business hours upon request with 24-hour
notice.
11.2. Licensor is the sole owner of all Rights granted to Licensee
hereunder; Licensor has not previously assigned, pledged, or otherwise
encumbered the same; the Pictures do not violate any rights of privacy; the
Pictures are not defamatory; neither the Titles, the documentation, nor an parts
thereof, nor any materials contained therein or synchronized therewith, nor the
exercise of any right, violated or will violate, or will infringe, any
trademark, trade name, contract, agreement, copyright (whether common law or
statutory), patent, literary, artistic, dramatic, personal, private, civil, or
other property right or right of privacy or any similar law or regulation or
other right whatsoever of, or slanders or libels, any person, firm, corporation,
or association whatsoever. Notwithstanding the foregoing, Licensor makes no
representation or warranties with respect to the laws or regulations of any
state, country or territory outside of the United States and/or the States of
Alabama, Kentucky, Mississippi, Oklahoma, Utah, North Carolina, South Carolina,
Tennessee or West Virginia, or Northern Florida, or any other jurisdiction
hereinafter adopting laws or regulations similar to the laws of such named
states.
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12. INDEMNITY
12.1. Each party hereto shall at times defend, indemnify and hold harmless
the other and their parent, subsidiary and affiliated companies, successors,
licensees and assigns and their respective officers, directors, employees and
agents (herein, the "Indemnified Parties"), against and from any and all claims,
damages, liabilities, costs and expenses, including reasonable counsel lees
(collectively "claims") arising out of any breach by such party (herein, the
"Indemnitor") of any representation, warranty, covenant or other provision
hereof. The Indemnified Parties shall notify the Indemnitor in writing of each
such claim, and shall have the right to defend such claims through counsel of
its own choosing.
12.2. The Indemnified Parties shall afford the Indemnitor the opportunity
to participate in any compromise, settlement, litigation or other resolution of
a third party claim, or, in the event the Indemnitor elects not to defend such
claim, the Indemnified Parties may assume the defense of any such claim or
litigation, at Indenmitor's cost and expense, with counsel of Indemnified
Parties' own choosing. In the event the Indemnitor elects to assume the defense,
the Indemnitor shall afford Indemnified Parties the opportunity to participate
fully in such defense at Indemnified Parties' expense.
12.3. Neither party shall compromise, settle or otherwise resolve any such
claim or litigation without the other party's prior written consent, which shall
not be unreasonably withheld; provided, however, that failure to respond within
five (5) business days following receipt of written notice of such proposed
compromise shall constitute consent to the proposed compromise, settlement or
resolution.
12.4. All representations, warranties and indemnities contained in this
Agreement shall survive an independent investigation made by Indemnified Parties
and the suspension or the termination of this Agreement.
13. SEVERABILITY
Subject to this section, if any provision of this Agreement or the
application thereof to any party of circumstance shall, to any extent, be
invalid and/or enforceable, the remainder of this Agreement and the application
of such provision to any other parties or circumstances other than those as to
which it is held invalid and/or unenforceable, shall not be affected thereby,
and each such other term and provision of this Agreement shall be valid and be
enforceable to the fullest extent permitted by law.
14. OTHER AGREEMENTS
14.1. The Licensor and CSB shall promptly execute, acknowledge, and deliver
or promptly procure the execution, acknowledgement and delivery of any and all
further assignments, agreements and instruments which may be deemed reasonably
necessary or expedient to effectuate the purposes of this Agreement.
14.2. For five (5) years, Licensor shall use its reasonable commercial
efforts to promote CSB's stations and affiliated web sites in all its
publications, videos and, products, etc. in accordance with CSB's reasonable
requests, including, but not limited to, providing free advertising space
therein for CSB's stations and web sites and permitting CSB to use, at its sole
cost and expense, female cast members from Licensor's motion pictures as
promotional spokespersons for CSB's Stations and affiliated web sites. In
addition, the parties shall discuss in good faith the feasibility of
establishing a 5O/50 joint venture to distribute and produce live Internet feeds
for broadcast on Licensor's and CSB's web sites. Licensor and CSB shall also
explore areas in which they can assist each other, such as in the launch of a
new CSB channel.
14.3. For five (5) years, CSB shall use its reasonable commercial efforts
to promote Licensor's Pictures and web sites on all CSB stations and affiliated
web sites, in accordance with Licensor's reasonable requests, including, but not
limited to, placing banners in reasonanly prominent areas on the Interactive
Gallery, Inc. ("IGallery") sites. In this record, IGallery will send marketing
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e-mails to its database of webmasters, place links in its webmaster portal
(http:\\xxx.xxxxxxxx.xxx) and place links on its IGallery Tips & Tricks
newsletter. In addition, during this period Licensor and IGallary each agree to
direct a portion of their exit traffic from and to their respective Internet
sites upon discounted-to-actua1 cost rates, subject to the conversion ratios for
such traffic being reasonably in line with industry averages. IGallery will
cause Interactive Telecom Network, Inc. ("ITN") to offer to assist Licensor in
back-end technical management of the Licensor's web sites, including, offering
competitive rates for co-location of servers, dedicated Internet access, systems
administration and website management, the streaming of media products, network
security solutions, DNS management, server-rack rental, customer service and
credit card clearing services, all as may be more particularly described and set
forth in a separate agreement between ITN and Licensor. IGallery has executed
this Agreement for the limited purpose of being bound to the obligations set
forth in this Section 14.3.
14.4. CSB covenants and agrees to adhere to the Licensor's reasonable
practices and policies with respect to protecting the copyrights owned by
Licensor in the licensed Pictures.
15. WAIVERS
No vaiver by either party of any breach or default under this Agreement
shall be deemed to be a waiver of any proceeding or subsequent breach or
default.
16. NOTICES
All notices or remittances which either party may wish to serve and/or may
be required to serve on the other under this Agreement, shall be in writing and
shall be served by personal delivery thereof or by prepaid certified mail,
return receipt requested, or by prepaid overnight air express delivery,
addressed to the respective parties at their addresses herein above set forth.
17. RELATIONSHIP OF THE PARTIES
Nothing in this Agreement contained shall be deemed to constitute either of
the parties being an agent of the other. Neither party shall hold itself out
contrary to the terms of this Agreement and neither party shall become liable by
reason of any representation, act or omission of the other contrary, to the
provisions hereof. Licensor is in all respects acting an independent contractor.
18. TERMINATION
This Agreement may be terminated by either party upon written notice to the
other party if such other party shall make a general assignment for the benefit
of creditors, or shall admit in writing its inability to pay its debts as they
become due, or any proceeding is commenced by or against such party (or in the
case of CSB, by or against New Frontier) under any provision of the U.S.
Bankruptcy Code or under other bankruptcy or insolvency law, including
assignment for the benefit of creditors (and in the case of an involuntary
proceeding, such proceeding is not dismissed within 60 days or the filing
thereof), or any such party's securities are delisted from Nasdaq. In addition,
Licensor may terminate this Agreement upon no less than three (3) business days
prior notice if CSB shall be in arrears to Licensor for license fees due to it
hereunder in an amount equal to or in excess of $200,000, and CSB shall not have
cured such breach within two (2) business days of its receipt of such notice.
Moreover, Licensor may terminate this Agreement should CSB fail to pre-select 36
new motion pictures, as described in Section 5.1. above, over any consecutive 15
month period commencing after January 1, 2000. Should Licensor terminate this
Agreement by reason of an action or conduct of CSB proscribed under this Section
18, all rights herein granted CSB shall forthwith terminate and revert to
Licensor.
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19. ENTIRE AGREEMENT
This Agreement contains the full and complete understanding between the
parties hereto and supersedes all prior understandings, whether written or oral,
pertaining to the subject matter hereof and cannot be modified except by a
written instrument signied by the parties hereto. In this regard, that certain
Program Supply Agreement, dated July 22, 1998 between the parties is hereby
terminated.
20. APPLICABLE LAWS
This Agreement shall be governed by the laws of the State of California and
the federal laws of the United States of America applicable therein.
21. ASSIGNMENT
This Agreement may not he assigned by either party hereto, by operation of
law or otherwise without the express written consent of the other, which consent
shall not be unreasonably withheld, delayed or conditioned.
22. COUNTERPARTS
This Agreements may be executed in counterparts, each of which shall
constitute an orginal and all of which, when taken together, shall constitute
one agreement.
23. PARTIES BOUND BY AGREEMENT
This Agreement is binding upon the parties hereto and upon their respective
successors and permitted assigns.
24. ARBITRATION.
Any dispute or claim arising under or with respect to this Agreement which
is incapable of resolution by the parties hereto will be resolved by arbitration
before one (1) arbitrator in Los Angeles, California in accordance with the
Rules for Commercial Arbitration of the American Arbitration Association
("AAA"). The appointing agency shall be the AAA. The decision or award of the
arbitrator shall be final and binding upon the parties. Any arbitrage award may
be entered as a judgment or order in an court of competent jurisdiction.
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25. HEADINGS
Headings or captions contained in this Agreement are for reference purpose
only and shall not affect in any way the meaning or interpretation of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date first herein above.
LICENSEE:
COLORADA SATELLITE BROADCASTING, INC. ATTEST:
/s/ Xxxxxxx Xxxxxx
------------------ -----------------
By: Xxxxxxx Xxxxxx, Executive VP and Secretary
LICENSOR:
METRO GLOBAL MEDIA, INC. ATTEST:
/s/ Xxxxx Xxxx
-------------- ------------------
By: Xxxxx Xxxx, Treasurer
METRO, INC. ATTEST:
/s/ Xxxx Xxxxx
-------------- -------------------
By: Xxxx Xxxxx, Vice-President
NEW FRONTIER MEDIA, INC. hereby guarantees the obligations of its subsidiary,
Colorado Satellite Broadcasting, Inc. hereunder and shall be bound to the
provisions of Section 7 regarding the issuance of its Common Stock and warrants
therefor.
NEW FRONTIER MEDIA, INC. ATTEST:
/s/ Xxxxxxx Xxxxxx
------------------ --------------------
By: Xxxxxxx Xxxxxx, Executive Vice President
ACKNOWLEDGEED AND AGREED with respect to the provisions of the last sentence of
Section 14.3. only:
INTERACTIVE GALLERY, INC. ATTEST:
/s/ Xxxxxxx Xxxxx
----------------- --------------------
By: Xxxxxxx Xxxxx, President
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