EXHIBIT 10(av)
[GRAPHIC OMITTED][GRAPHIC OMITTED]
Digital Broadcasting Site System
Site Operations Agreement
With
Trans World Entertainment Corporation
AGREEMENT made the 4th day of August 1999, by and between Trans World
Entertainment Corporation ("TWE") and XxxxxxxxxxxXxxxx.xxx Incorporated ("DMC").
WHEREAS, DMC is in the business of providing a system which integrates
various patent pending technologies to deliver site-selected audio programming,
broadcast advertising and on-wall billboard advertising, known as the Digital
Broadcast Site system ("DBS"); and
WHEREAS, TWE wishes DMC to install a DBS system or systems in its place or
places of business, identified on Exhibit A, attached hereto (the "Premises").
It is understood that DMC will provide DBS systems for TWE for expansions or
acquisition of new stores.
NOW, THEREFORE, for Ten Dollars ($10.00) and other good and valuable
consideration, the parties hereto do hereby agree as follows:
1. Term.
a. The Term of this agreement shall commence on the date hereof and
end five (5) years thereafter. The Term of this agreement shall
automatically renew itself for successive five (5) year periods
thereafter, unless terminated by TWE by provision to DMC of
written notice of its intention not to renew this agreement, not
later than 120 days prior to the expiration of the then current
term. During the first six months of this contract, DMC and TWE
will conduct a test of the system in one location, then if the
test is satisfactory, at TWE's sole discretion, the test will be
expanded to five locations to determine TWE's desire to expand
the installation company wide. If at any time during the test TWE
determines that it is in its best interest not to expand the
installation it will have no other obligation under this
contract. In store volume control will be reviewed during the
test.
b. If TWE does not receive the level of service promised by DMC, it
will notify DMC of the specific incidences that were below
standard. Upon notification, DMC will respond in writing and
correct the deficiencies as soon as practical, but in no case
beyond thirty (30) days. If the deficiencies have not been
corrected within thirty (30) days, TWE will notify DMC in
specifics regarding the failure to correct. If DMC has not
corrected these deficiencies within the next thirty (30) days,
TWE has the option during the subsequent sixty (60) days to
cancel this agreement. Determination of deficiencies being
corrected is at the sole discretion of TWE, Cancellation of this
agreement will take place upon written notice, one hundred and
twenty (120) days in advance of the effective cancellation date.
DMC will remove their equipment no later than thirty (30) days
after the effective cancellation date.
2. Digital Music System.
a. License. DMC hereby grants to TWE a license to use, throughout
the Term hereof and in the manner set forth herein, two thousand
and two hundred (2,200) DBS systems.
b. Installation; Equipment ownership. DMC shall, at its sole
cost and expense, install the DBS Equipment in the Premises,
in locations selected by TWE. The DBS Equipment shall at all
times remain the sole and exclusive property of DMC. TWE
shall execute and permit DMC to file any financing statement
or other documentation necessary to preserve or perfect
DMC's ownership of the DBS Equipment. TWE shall not attempt
to transfer, sell, lien, pledge or encumber the DBS
Equipment. TWE shall not move the DBS Equipment without the
prior written consent of DMC. Upon the expiration or earlier
termination hereof, TWE shall immediately provide DMC
reasonable access to the Premises during business hours or
subsequent location of the DBS Equipment in order to remove
same.
c. Maintenance. DMC will maintain, service and replace all
components of the DBS system throughout the Term hereof at
its sole cost and expense.
3. Advertising Revenue Participation. DMC shall pay to TWE twenty-five per
cent (25%) of the gross revenues, which DMC receives from advertising sponsors,
which is attributable to the Premises' participation as a DBS site. DMC shall
pay such percentage of advertising revenue to TWE quarterly, in arrears. If at
any time during the term of this agreement or any renewal thereof, DMC enters
into an agreement to install a DBS system in any other person's place of
business, then TWE shall have a right to revenue participation or any other
payments in respect of a DBS site on terms and conditions at least as favorable
as the most favored terms and conditions granted to any other party.
4. Programming
a. Music Selection: DMC will provide music to each DBS system during
the hours of TWE's normal business operations during the Term of
this agreement at no cost to TWE. TWE may select its preferences
of music categories from those set forth on Exhibit C, attached
hereto. Throughout the Term hereof, DMC will reasonably
incorporate TWE's preferences through regular updates of the
musical programming. b. TWE will request specific music tracks,
and DMC will program the music as requested by TWE.
5. Advertising.
a. DMC will play audio advertising spots throughout each programming
day.
b. Audio commercials will not exceed 30 seconds without TWE's
approval.
c. Audio commercials will not exceed 6 minutes per hour without
TWE's approval.
d. DMC may not pitch or sell advertising to TWE's coop advertisers
without TWE's approval.
e. DMC will not offer advertisers exclusives without the concurrence
of TWE.
f. DMC will be receptive to expanding relationships with advertisers
when requested by TWE.
g. DMC will routinely inform TWE of targeted advertisers.
h. TWE can selectively use a veto for unwanted advertisers for good
and valid business reasons.
i. If TWE believes that co-op funds are being effected by
advertising booked by DMC, DMC will pull the ad or otherwise
correct the situation.
j. TWE will provide DMC with guideline parameters for the booking of
advertisements.
k. TWE has the final say on the number of speakers to be placed in a
store.
6. Demographics. Throughout the term of this agreement, TWE will, upon
request, provide to DMC reasonably detailed information concerning the typical
number of its customers and clientele in each store each day.
7. Upon reasonable request, following at least ten (10) business days prior
notice to DMC, TWE shall be entitled to inspect the books and records of DMC
pertaining to the payments rights to which TWE is entitled under Section 3 of
this agreement, for the sole purpose of confirming accuracy of the payments
received pursuant to Section 3 and for determining the availability of most
favored terms and conditions to TWE. Any such inspection may be made no more
frequently than once in any fiscal quarter of DMC, will be at TWE's sole
expense, and will take place during normal business hours. TWE agrees to
maintain the confidentiality of any such books and records, except as may be
necessary to enforce its rights under Section 3.
8. Notices. All notices hereunder shall be made by first class mail,
national overnight delivery service, telecopier or hand-delivery to the
following addresses:
To DMC:
XxxxxxxxxxxXxxxx.xxx, Incorporated
Xxx Xxxx Xxxxxx
Xxxxxxxx, XX. 00000
Attn: Xxxxx XxXxxxx, President and Chief Executive Officer
With a copy to:
Lev, Berlin & Xxxx, P.C.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX. 00000
Attn. Xxxxx X. Xxxxxx, Esq.
To: TWE ________________________________
________________________________
________________________________
With a copy to:
________________________________
________________________________
________________________________
________________________________
9. Integration; Disclaimers.
A. Sole Agreement: This agreement constitutes the sole and exclusive
understanding of the parties with respect to the subject matter
hereof.
B. No Warranties; Waiver of Claims: TWE hereby acknowledges that DMC
has made no representation or warranty, express or implied,
except as specifically set forth herein. TWE hereby releases and
holds DMC, its affiliates, TWE's, employees and agents harmless
from and against any loss, claim, liability or damage relating or
with regard to the transactions contemplated by or discussed
herein other than those caused by DMC's willful misconduct and in
all events waives any claim for lost profits or other
consequential damages in this connection.
C. The ability to page through the DBS is specifically not certified
for emergency use, and TWE indemnifies DMC against any claims
arising from the use of the DBS system in emergency situations.
9. Binding Effect. This agreement shall be binding upon the parties hereto,
their heirs, successors and assigns.
10. Governing Law. This agreement shall be governed by the laws of the
State of Connecticut, without giving effect to principles of conflicts of law.
XxxxxxxxxxxXxxxx.xxx, Incorporated
__________________________________
By: Xxxxx XxXxxxx
Its: President and Chief Executive Officer
TWE Corporation
____________________________________
By: _______________________________
Its: _____________________________
Exhibit A
The Premises
Exhibit B
Music Categories
1 Acoustic Guitar
2 All Time Favorites
3 Broadway Favorites
4 Caribbean
5 Classical
6 Classical, Light
7 Contemporary Hits
8 Contemporary, Adult 45+
9 Contemporary, Adult, Hot
10 Contemporary, Adult, Mainstream
11 Country, Classic
12 Country, Hits
13 Dance
14 Dixieland
15 Easy Listening Mix
16 Ethereal / Ambient
17 Exotic
18 Futuristic / Space
19 Great Movie Themes
20 Hip Hop
21 Inspirational
22 Instrumental
23 Jazz
24 Jazz, Light
25 New Age
26 Piano Selections
27 Rhythm & Blues
28 Rhythm & Blues, Classics
29 Rock, Alternative
00 Xxxx, Classic
31 Rock, Hard
32 Rock, Soft
33 Romantic
34 Site Favorites
35 Sophisticated
36 Top 40
37 Upbeat
