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As Of Filer Filing For·On·As Docs:Size Issuer Agent 10/31/07 Platinum Studios, Inc. SB-2/A 19:9.2M MDM Corp Elec Fi… Inc/FA |
Document/Exhibit Description Pages Size 1: SB-2/A Platinum Studios LLC Formsb-2/A HTML 1.19M 2: EX-4.1 Instrument Defining the Rights of Security Holders HTML 91K 3: EX-5.1 Opinion re: Legality HTML 13K 12: EX-10.10 Material Contract HTML 47K 13: EX-10.11 Material Contract HTML 144K 14: EX-10.12 Material Contract HTML 20K 15: EX-10.13 Material Contract HTML 257K 16: EX-10.14 Material Contract HTML 589K 17: EX-10.15 Material Contract HTML 37K 18: EX-10.16 Material Contract HTML 97K 4: EX-10.2 Material Contract HTML 49K 5: EX-10.3 Material Contract HTML 35K 6: EX-10.4 Material Contract HTML 52K 7: EX-10.6 Material Contract HTML 96K 8: EX-10.7 Material Contract HTML 8K 9: EX-10.7 Exhibit 10.7 PDF Version -- ex107 PDF 3.03M 10: EX-10.8 Material Contract HTML 578K 11: EX-10.9 Material Contract HTML 179K 19: EX-23.1 Consent of Experts or Counsel HTML 9K
1.
|
Reference
is made to Paragraph 2.2.a. of the Agreement. Notwithstanding
anything to the contrary therein, WDP hereby acknowledges and agrees
that the Initial Option Period shall end twenty-four (24) months
following
the earlier
to occur of: (a) satisfaction of the Conditions Precedent set forth
in
Paragraph 1 of the Agreement or (b) the date on which WDP pays Michael
Cooney for the commencement
of his writing services in connection with the
Picture.
|
2.
|
Reference
is made to Paragraph 3.1.c. of the Agreement, which is
hereby deleted
in its entirety and replaced with the following new Paragraph
3.1.c.:
|
(i)
|
If
either: (A) 25,000 or more units of the Property are sold as a
graphic novel (provided that Owner submits documentation substantiating
such amount in form and substance acceptable to WDP in its sole
discretion) prior to commencement of principal photography of the
Picture
or (B) the Property is listed among the top 200 titles on ICv2's
Top 300
Comics Actual Index (www.lcv2.com) during any month prior to the
commencement of principal photography of the Picture, and the Picture
is
produced and released as a feature-length Theatrical Motion Picture,
then
the following royalties are payable for each episode of a television
series based upon the Picture, as produced for a particular broadcast
season:
|
Primetime
Network (i.e., ABC, CBS or NBC)
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
2,250
|
||
60
minutes (or less, but in excess
|
$ |
2,750
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$ |
3,250
|
||
Non-
Primetime Network or Non-Network
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
1,125
|
||
60
minutes (or less, but in excess
|
$ |
1,375
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$ |
1,625
|
(ii)
|
If: (A)
25,000 units of the Property are not sold as a graphic novel
prior to commencement of principal photography of the Picture or
(B)
the Property is not listed among the top 200 titles on ICv2's Top
300
Comics
Actual Index (www.lcv2.com) during any month prior to the
commencement
of principal photography of the Picture, and the Picture is produced
and released as a feature-length Theatrical Motion Picture, then,
in lieu of the television series royalties set forth in Paragraph
3.1.c(i)
above,
the following royalties are payable for each episode of a television
series
based upon the Picture, as produced for a particular broadcast
season:
|
Primetime
Network (i.e., ABC, CBS or NBC)
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
750
|
||
60
minutes (or less, but in excess
|
$ |
1,250
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$ |
1,750
|
||
Non-
Primetime Network or Non-Network
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
375
|
||
60
minutes (or less, but in excess
|
$ |
625
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$
|
875
|
" | |
3.
|
Alternative
Production Source Credit. Reference is made to Paragraph 4. of the
Agreement. The following shall be added as Paragraph 4.4
thereto:
|
"4.4
|
Alternative
Production Source Credit. Provided: (a) the Property is listed on the
Diamond Comic Distributors, Inc. U.S. preview catalog prior to
commencement
of principal photography on any direct-to-video motion picture,
television
motion picture and/or television series produced hereunder which
is
substantially
based on the Property (each an "Alternative Production"); and (b)
Owner
is not in breach or default hereunder, then subject to network
approval, any
applicable guild and/or union restrictions and WDP's standard exclusions
and
exceptions (including artwork title exceptions), WDP shall accord
Owner source
credit in connection with any such Alternative Production produced
by
WDP
hereunder, as follows:
|
(i)
|
On
Screen. On a separate card (which card may be shared in WDP's sole
discretion with other source material on which the Alternative
Production is based), in the main titles if any other non-cast
member
(excluding financier[s] or distributor[s] of the Picture and WDP's
presentation credit) is accorded credit in the main titles (otherwise
in
the end titles), below or after the title, in substantially the form
of
"Based on the Platinum Studios comic book created by Scott Mitchell
Rosenberg," or if the title of the Alternative Production is materially
different from that of the Property, then said credit shall be
substantially in the form of 'Based on the Platinum Studios comic
book
`Unique' created by Scott Mitchell Rosenberg"
in an average size of type not less than the larger of: (i) fifty
percent
(50%) of the average size of type of the title of the Alternative
Production
on screen or (ii) one hundred percent (100%) of the average size
of type
utilized to accord credit the screenwriter credit on
screen.
|
(ii)
|
Paid
Ads. In paid ads issued or controlled by WDP, in the billing
block portion only, if any, (i.e., if such otherwise applicable paid
ad
does
not have a billing block, Owner shall not be entitled to receive
credit
in
such paid ad), below or after the regular ie., not artwork) title
of
the Alternative
Production, in substantially the form of "Based on the comic book
by Scott Mitchell Rosenberg," or if the title of the Picture is materially
different
from that of the Property, then said credit shall be substantially
in
the
form of "Based on `Unique' by Scott Mitchell Rosenberg" in an average
size of type not less than the larger of: (i) thirty-five percent
(35%)
of
the average size of the regular i.e., not artwork) title of the
Alternative Production
in such billing block or (ii) one hundred percent (100%) of the
average
size of type utilized to accord the screenwriter credit in such
billing
block. If the regular billing block is used in the jacket of the
videocassette
or video disc (i.e., if such otherwise applicable videocassette
and/or video disc does not have a billing block, Owner shall not
be entitled to receive credit in such videocassette and/or video
disc),
Owner's
name shall appear as part of the regular billing block of said
videocassette
and/or video disc.
|
(iii)
|
Excluded
Ads: In the billing block portion only, if any, of any so-called
excluded ads issued or controlled by WDP in which the screenwriter
is accorded credit in such billing block (i.e., if such otherwise
applicable excluded ad does not have a billing block, then Artist
shall
not be entitled to receive credit in such excluded ad), below or
after the
regular
(i.e., not artwork) title of the Alternative Production in such
billing block,
in substantially the form "Based on the comic book by Scott Mitchell
Rosenberg," or if the title of the Picture is materially different
from
that of the Property, then said credit shall be substantially in
the form
of "Based on `Unique' by Scott Mitchell Rosenberg," in an average
size of
type not less than the larger of: (i) thirty-five percent (35%) of
the
average size of type of the regular (i.e., not artwork) title of
the
Picture in such billing block;
or (ii) one hundred percent (100%) of the average size of
type utilized
to accord the screenwriter credit in such billing block. Notwithstanding
the foregoing, Artist shall not be entitled to receive credit in
congratulatory, nomination and/or award ads in which only the person(s)
so recognized receive credit, special ads, ads specially exempted
by Paragraphs 8-203d., 8-203f. and 8-203g. of the DGA Basic Agreement,
ads
announcing a personal appearance, radio ads and the audio portion
of
teasers, trailers and television ads."
|
Very truly yours, | |||
WALT DISNEY PICTURES | |||
|
By:
|
/s/ Douglas A. Carter | |
DOUGLAS A. CARTER | |||
Its: | SENIOR VICE PRESIDENT | ||
BUSINESS AFFAIRS |
DATE:
|
As of December 11, 2003 | ||
"UNIQUE" / PLATINUM | |||
SUBJECT:
|
|
STUDIOS LLC/ OPTION / | |
ACQUISITION OF RIGHTS |
1.
|
CONDITIONS
PRECEDENTWDP
shall have no obligation to perform under this Agreement unless and
until:
|
1.1
|
WDP
receives an executed original of this Agreement including all attachments
hereto (in form and substance acceptable to
WDP);
|
1.2
|
WDP
receives an executed agreement (in form and substance acceptable
to WDP)
between WDP and David Goyer ("Goyer") (or his loan-out company) for
Goyer's
directing services in connection with the
Picture;
|
1.3
|
WDP
receives an executed agreement (in form and substance acceptable
to WDP)
between WDP and David Heyman ("Heyman") (or his loan-out company)
for
Heyman's producing services in connection with the
Picture;
|
1.4
|
WDP
receives an executed agreement (in form and substance acceptable
to WDP)
between WDP and Scott Mitchell Rosenberg ("Rosenberg") (or his loan-out
company) for Rosenberg's producing services in connection with the
Picture;
|
1.5
|
WDP
receives an executed agreement (in form and substance acceptable
to WDP)
between WDP and Michael Cooney ("Cooney") (or his loan-out company)
for
Cooney's writing services in connection with the Picture;
and
|
1.6
|
WDP
approves, in its sole discretion, the chain-of-title of the rights
granted
to WDP herein, approves all agreements with respect thereto, and
receives
all assignments and releases (including publisher's releases) that
it
requires in connection therewith (in form and substance acceptable
to
WDP).
|
2.1
|
Option;
Rights Granted. Owner hereby grants to WDP the exclusive and
irrevocable
option ("Option") to acquire all right, title and interest, including,
without limitation,
all forms of: motion picture, television, digital television, video
and
computer games, videocassette, video and laser disc, computer assisted
media (including, but not limited to, CD-ROM, CD-I and similar disc
systems, interactive media and multimedia and any other devices or
methods
now existing or hereafter devised), character, remake, sequel, sound
record, theme park, stage play, merchandising and all allied, ancillary
and subsidiary rights therein of every kind and nature, now known
or
hereafter devised, throughout the universe and in perpetuity, in
all
languages, in and to the Property
(collectively the "Rights," as more fully defined in Paragraph 5.
below),
subject only to the reserved rights enumerated in Paragraph 6.
below.
|
a.
|
Initial
Option Period. The Option may be exercised by
written notice
given at any time commencing as of the date of this Agreement and
ending
twenty-four (24) months following satisfaction of the Conditions
Precedent
set forth in Paragraph 1. above (the "Initial Option Period"), subject
to
extension as set forth below.
|
b.
|
First
Extended Option Period. The Initial Option Period may be extended, in
WDP's sole discretion, for an additional period of twelve (12)
months
(the "First Extended Option Period") commencing upon the expiration
of the
Initial Option Period by written notice to Owner during the Initial
Option. Period,
subject to extension as set forth
below.
|
c.
|
Second
Extended Option Period. The First Extended Option Period
may be extended, in WDP's sole discretion, for an additional period
of six
(6)
months (the "Second Extended Option Period") commencing upon the
expiration
of the First Extended Option Period by written notice to Owner during
the
First Extended Option Period, subject to extension as set forth
below.
|
d.
|
Suspension
/ Extension. The Initial Option Period as extended, if ever, by the
First Extended. Option Period and the Second Extended Option Period,
is hereinafter referred to as the "Option Period." Notwithstanding
anything
to the contrary contained herein, any option period may be further
extended
for any period during which a claim with respect to the Property
has been
asserted and remains unresolved (provided that, with respect to any
claim
that is not based on Lender's and Owner's representations, warranties
or
obligations
hereunder, such extension shall not exceed eighteen (18) months unless
(i)
a lawsuit has been filed with regard to such claim, (ii) an agreement
to
enter into arbitration has been reached, (iii) an agreement to enter
into
any other judicial proceeding or alternative dispute resolution proceeding
[e.g., mediation, so-called "rent-a-judge" proceedings, etc.] has
been
reached, in which case this eighteen
(18) month time limitation shall not apply), or (iv) WDP has entered
into
settlement negotiations, in which case this eighteen (18) month time
limitation shall not apply), and for any period during which WDP's
development and/or production
activities based upon the Property are interrupted or postponed due
to any
occurrence of an event of force majeure, including without limitation,
any
labor strike, threatened labor strike, or other labor
dispute.
|
a.
|
Initial
Option Period. In consideration of Owner's grant to WDP of
the
Option, WDP shall pay Owner the sum of $300,000 (the "Initial Option
Fee")
upon execution and delivery of this Agreement by Owner to WDP and
satisfaction
of the Conditions Precedent set forth in Paragraph 1. above (whichever
last occurs), which Initial Option Fee shall be fully applicable
against
the "Purchase Price" set forth in Paragraph 2.6
below.
|
b.
|
First
Extended Option Period. If WDP extends the Initial Option Period as
set forth in Paragraph 2.2.b. above, WDP shall pay Owner the additional
sum of $100,000 (the "First Extended Option Fee") upon the commencement
of the First Extended Option Period, which First Extended Option
Fee shall not be applicable against the "Purchase Price" set forth
in
Paragraph
2.6 below.
|
c.
|
Second
Extended Option Period. If WDP extends the First Extended
Option Period as set forth in Paragraph 2.2.c. above, WDP shall pay
Owner
the additional sum of $50,000 (the "Second Extended Option Fee")
upon the
commencement of the Second Extended Option Period, which Second
Extended
Option Fee shall not be applicable against the "Purchase Price" set
forth
in Paragraph 2.6 below.
|
2.4
|
Exercise
of Option. The Option shall be deemed exercised upon either notice
given to Owner (or Owner's agent) during the Option Period or the
commencement
of principal photography of the Picture, if
ever.
|
2.5
|
License.
Owner exclusively licenses WDP (and Persons and entities engaged
by WDP) to engage in preproduction, development and writing activities
based on or pertaining to the Property during the Option Period.
Owner
acknowledges that Owner shall have no right, title or interest in
or to
the results and proceeds of any such activities, whether or not the
Option
is exercised, and that such results and proceeds shall be the sole
property of WDP, whether or not the Option is
exercised.
|
2.6
|
Purchase
of Property. If WDP exercises the Option, WDP will own all of the
Rights (subject only to the reserved rights enumerated in Paragraph
6.
below), and as payment in full for Owner's grant of the Rights to
WDP and
for all of the promises, representations, warranties and agreements
made
by Owner hereunder, and provided Owner is not in breach or default
hereunder, Owner shall be entitled to receive the sum of
$1,000,000 (the "Purchase Price") less the Initial Option Fee i.e.,
$300,000) previously
paid to Owner pursuant to Paragraph 2.3.a. above, which sum shall
be
payable
to Owner upon the earlier to occur of the exercise of the Option
by notice
to Owner or the commencement of principal photography of the Picture,
if
ever.
|
2.7
|
Production
Bonus. If the Picture is produced and released as a
feature-length
Theatrical Motion Picture, and provided that Owner is not in breach
or
default hereunder,
then Owner shall be entitled to receive a bonus in the amount of
$250,000,
which
amount shall accrue and become payable to Owner upon commencement
of
principal
photography of the Picture as a feature-length Theatrical Motion
Picture,
if ever.
|
2.8
|
Fair
Compensation. Owner acknowledges that the compensation provided
to be paid pursuant to Paragraphs 2.3.a., 2.3.b. (if applicable)
2.3.c (if
applicable)
and 2.6 (if applicable) above, is by itself fair, reasonable and
sufficient compensation
for the rights granted to WDP hereunder whether or not any production
bonus pursuant to Paragraph 2.7 above or contingent payment pursuant
to
Paragraph 2.9
below ever becomes payable to
Owner.
|
2.9
|
Contingent
Payments. If the Picture is produced and released as a feature-length
Theatrical Motion Picture, and Owner is not in breach or default
hereunder, then Owner shall be entitled to receive the following,
as
applicable:
|
a.
|
At
such time, if ever, that the Picture achieves "Start Point #1" (as
defined
in Paragraph 2.10.d. below), the flat sum of
$250,000;
|
b.
|
At
such time, if ever, that the Picture achieves "Start Point #2" (as
defined
in Paragraph 2.10.e. below), an amount equal to 1-1/4% of 100% of
the
Adjusted
Defined Receipts, if any, of the Picture accruing from Start Point
#2;
and
|
c.
|
At
such time, if ever, that the Picture achieves "CP Start Point" (as
defined
in Paragraph 2.10.f. below), the percentage of Adjusted Defined
Receipts,
if any, in Owner's contingent payment set forth in Paragraph 2.9.b.
above
shall escalate prospectively (i.e., not retroactively) to an amount
equal
to 2-1/2% of 100% of the Adjusted Defined Receipts, if any, of the
Picture, in excess
of and accruing after CP Start Point is achieved, if
ever.
|
a.
|
"Adjusted
Defined Receipts" as referenced herein shall be defined, computed,
accounted for and paid in accordance with WDP's Exhibit "DRCB" (and
the
rider thereto), and is defined as the Defined Receipts specified
in
Paragraph
1.1.A. of Schedule 1 thereof (subject to the exclusions set forth
in
Paragraph 1.1.B. of Schedule 1 thereof), less the deductions set
forth in
Paragraph
1.1.C. of Schedule 1 thereof, but substituting theatrical reissue
costs
in
place of the theatre level advertising expenses set forth in Paragraph
1.1.C.1, of Schedule 1 thereof (i.e., costs incurred in connection
with
conversions, checking,
collections, residuals, trade dues, licenses, taxes and theatrical
reissue
costs).
|
b.
|
"Defined
Receipts" as referenced herein shall be defined, computed and accounted
for in accordance with WDP's Exhibit "DRCB" (and the rider thereto).
|
c.
|
"Contingent
Proceeds" and "Contingent Bonus Formula" as referenced herein shall
be
defined, computed, accounted for and paid in accordance with WDP's
Exhibit
"CB" (and the rider thereto).
|
d.
|
"Start
Point #1" as referenced herein shall be defined as the end of the
accounting period, if ever, in which Contingent Proceeds, if any,
are
achieved in accordance with the "Contingent Bonus Formula" set forth
in
Exhibit "CB" and the rider thereto), except that for the purpose
of
calculating Start Point #1 only, in lieu of those "Percentage Deductions"
set forth in the Contingent Bonus Formula, the Percentage Deduction
shall
instead be an "off-the-top" zero percent (0%) in all territories
and media
described therein.
|
e.
|
"Start
Point #2" as referenced herein shall be defined as the end of the
accounting period, if ever, in which Contingent Proceeds, if any,
are
achieved in accordance with the "Contingent Bonus Formula" set forth
in
Exhibit "CB" (and the rider thereto) except that for the purpose
of
calculating Start Point #2 only, in lieu of those "Percentage Deductions"
set forth in the Contingent Bonus Formula, the Percentage Deduction
shall
instead be an "off-the-top" twenty percent (20%) in all territories
and
media described therein.
|
f.
|
"CP
Start Point" as referenced herein shall be defined as the end of
the
accounting
period in which there are first Contingent Proceeds, if ever, from
the
Picture
as calculated pursuant to WDP's Exhibit "CB" (and the rider
thereto).
|
3.1
|
Theatrical
Sequels; Theatrical Remakes; Television Programs. If the Picture
is produced and W DP thereafter produces a Sequel to or Remake of
the. Picture,
or a Television Motion Picture based on the Picture, and provided
Owner is
not engaged to write for the applicable production, and further provided
Owner is not in breach
or default of a material term or condition hereunder, then Owner
shall be
entitled to receive the applicable royalty specified below, it being
understood and agreed that Owner
shall bear and be responsible for the payment of any and all third
party
royalties or use payments of any kind claimed by or through Owner
to be
payable in connection with the Property ("Third Party Royalties"),
and
shall fully indemnify WDP in connection with any and all Third Party
Royalties.
|
a.
|
Theatrical
Sequel. If WDP, in its sole discretion, produces a feature-length
Theatrical Motion Picture Sequel to the Picture based upon a character
(whether or not the name of such character in such Theatrical Motion
Picture
Sequel is the same as the name of such character in the Property)
or plot
line(s)
from the Property which does not appear in the Picture, Owner shall
be
entitled
to one hundred percent (100%) of the Purchase Price actually paid
to
Owner
pursuant to Paragraph 2.6 above and one hundred percent (100%) of
the
Production
Bonus actually paid to Owner pursuant to Paragraph 2.7. above plus,
as
a contingent payment, contingent payments of such sequel, which payments
shall
be equal to one hundred percent (100%) of the contingent payments
to which
Owner was entitled for the Picture as set forth in Paragraph 2.9
above
(e.g.,
[i] at such time, if ever, that such feature-length Theatrical
Motion
Picture Sequel
achieves Start Point #1, the flat sum of $250,000 [ii] at such time,
if
ever, that
such feature-length Theatrical Motion Picture Sequel achieves Start
Point #2,
an amount equal to 1-1/4% of 100% of Adjusted Defined Receipts, if
any, of
such
Sequel accruing from Start Point #2 and [iii] at such time, if ever,
that
such feature-length
Theatrical Motion Picture Sequel achieves CP Start Point, an amount
equal to 2-1/2% of the Adjusted Defined Receipts, if any, of such
Sequel,
on a prospective basis); provided, however, that if WDP, in its sole
discretion,
produces a feature-length Theatrical Motion Picture Sequel that is
based
upon a character (whether or not the name of such character in
such Theatrical
Motion Picture Sequel is the same as the name of such character in
the
Property) or plot line(s) from the Property which appears in the
Picture,
Owner
shall be entitled to one-half (1/2) of the Purchase Price actually
paid to
Owner
pursuant to Paragraph 2.6 above and one-half (1/2) of the Production
Bonus
actually paid to Owner pursuant to Paragraph 2.7 above plus, as a
contingent
payment, a percentage of the contingent payments (if any) of such
feature-length
Theatrical Motion Picture Sequel, which contingent payment shall
be
equal to one-half (1/2) of the contingent payments to which Owner
was
entitled
for the Picture as set forth in Paragraph 2.9 above (e. [i] at such
time,
if
ever, that such feature-length Theatrical Motion Picture Sequel achieves
Start Point
#1, the flat sum of $125,000 [ii] at such time, if ever, that such
feature-length
Theatrical Motion Picture Sequel achieves Start Point #2, an amount
equal
to 0.625% of 100% of Adjusted Defined Receipts, if any, of such Sequel
accruing
from Start Point #2 and [iii] at such time, if ever, that such
feature-length
Theatrical Motion Picture Sequel achieves CP Start Point, an amount
equal
to 1-1/4% of the Adjusted Defined Receipts, if any, of such Sequel,
on a
prospective
basis).
|
b.
|
Theatrical
Remake. One-third (1/3) of the Purchase Price actually paid to Owner
pursuant to Paragraph 2.6 above and one-third (1/3) of the Production
Bonus actually paid to Owner pursuant to Paragraph 2.7. above plus,
as a
contingent payment, contingent payments of such feature-length Theatrical
Motion Picture Remake, which payments shall be equal to one-third
(1/3) of
the contingent payments to which Owner was entitled for the Picture
as set
forth in Paragraph 2.9 above (e.g„ [i] at such time, if ever, that such
feature-length Theatrical
Motion Picture Remake achieves Start Point #1, the flat sum of
$83,333
[ii] at such time, if ever, that such feature-length Theatrical Motion
Picture
Remake achieves Start Point #2, an amount equal to 0.42% of 100%
of
Adjusted Defined Receipts, if any, of such Remake and [iii] at such
time,
if ever, that such feature-length Theatrical Motion Picture Remake
achieves CP Start Point, an amount equal to 0.83% of the Adjusted
Defined
Receipts, if any, of such Remake, on a prospective
basis).
|
(i)
|
If
either: (A) 25,000 or more units of the Property are sold as a
graphic novel (provided that Owner submits documentation substantiating
such amount in form and substance acceptable to WDP in its sole
discretion) prior to commencement of principal photography of the
Picture
or (B) the Property is listed among the top 200 titles on ICv2's
Top 300
Comics Actual Index (www.lcv2.com) during any month prior to the
commencement of principal photography of the Picture, and the Picture
is
produced and released as a feature-length Theatrical Motion Picture,
then
the following royalties are payable for each episode of a television
series based upon the Picture, as produced for a particular broadcast
season:
|
Primetime
Network (i.e., ABC, CBS or NBC)
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
2,000
|
||
60
minutes (or less, but in excess
|
$ |
2,500
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$ |
3,000
|
||
Non-
Primetime Network or Non-Network
|
||||
Running
Time
|
Payment
|
|||
30
minutes (or less)
|
$ |
1,000
|
||
60
minutes (or less, but in excess
|
$ |
1,250
|
||
of
30 minutes)
|
||||
90
minutes (or more)
|
$ |
1,500
|
(ii)
|
If:
(A) 25,000 units of the Property are not sold as a graphic novel
prior to commencement of principal photography of the Picture or
(B) the
Property is not listed among the top 200 titles on ICv2's Top 300
Comics
Actual Index (www.lcv2.com) during any month prior to the
commencement
of principal photography of the Picture, and the Picture is produced
and
released as a feature-length Theatrical Motion Picture, then in lieu
of
the television series royalties set forth in Paragraph 3.1.c (i)
above,
the following royalties are payable for each episode of a television
series based upon the Picture, as produced for a particular broadcast
season:
|
Primetime
Network (i.e., ABC, CBS or NBC)
|
|
Running
Time
|
Payment
|
30
minutes (or less)
|
$500
|
60
minutes (or less, but in excess
|
$1,000
|
of
30 minutes)
|
|
90
minutes (or more)
|
$1,500
|
Non-
Primetime Network or Non-Network
|
|
Running
Time
|
Payment
|
30
minutes (or less)
|
$250
|
60
minutes (or less, but in excess
|
$500
|
of
30 minutes)
|
|
90
minutes (or more)
|
$750
|
d.
|
Movies(s)-of-the-Week
or Mini Series. An aggregate sum of $25,000
for the first two (2) hours, $10,000 for each additional hour thereafter
(prorated for portions thereof), not to exceed a maximum of $100,000,
regardless
of running time.
|
e.
|
Reruns
and Royalties. Twenty percent (20%) of the applicable royalty
set forth in Paragraphs 3.1.c. and 3.1.d. above shall be payable
for each
of the first five (5) network reruns in the combined territory of
the
United States and
Canada. No further rerun payments shall be made thereafter unless
required
by the MBA (as defined below), and if so required, at the minimum
rate
specified therein.
|
f.
|
Generic
Spin-Off Series. If WDP, in its sole discretion, produces a so-called
"generic" spin-off series based upon a television series based upon
the
Picture, and if Owner receives sole "Based Upon Characters Created
by"
credit with respect to the television series, then Owner shall be
entitled
to receive an amount
equal to fifty percent (50%) of the applicable amount set forth in
Paragraph
3.1.c., above, for each so-called "generic" spin-off series. A "generic"
spin-off series is a series in which a central character in a continuing
role was created
by Owner and appeared in the Picture and the original series based
thereon.
No royalties will be payable to Owner for any so-called "planted"
spinoff
series. A "planted" spin-off series is a spin-off from the original
television series
in which no central character in the Picture or the original television
series appears in a continuing role in the spin-off
series.
|
g.
|
Payment
of Royalties. Unless specified otherwise, theatrical payments
due under this Paragraph 3.1 shall be payable upon commencement of
principal photography and television payments shall be payable upon
the
initial
United States broadcast. Except as expressly set forth herein, WDP
shall
not be obligated to make any so-called residual, re-run, foreign
use or
theatrical use payments to Owner with respect to any motion pictures
produced by WDP based on the
Property.
|
h.
|
Inclusive
of MBA Minimums. To the extent, if at all, this Agreement is subject
to the Writers Guild of America Theatrical and Television Basic
Agreement
(the "MBA"), the royalty and rerun payments set forth in this Paragraph
3. are inclusive of any minimum royalties and rerun fees payable
under
the MBA for the corresponding use. Any additional payment required
by the
MBA under this or any other paragraph of this Agreement shall be
payable
at the minimum rat e required under the MBA.
|
i.
|
Payments
in Lieu of Any Other Royalties. The payments set forth in
Paragraph 3.1 are in lieu of any other sequel, remake, or separation
of
rights payments,
including, without limitation, any such payments, if any, that Owner
would
be entitled to receive pursuant to any applicable collective bargaining
agreement.
|
3.2
|
Merchandising.
If the Picture is produced and released as a featurelength Theatrical
Motion Picture, and provided Owner is not in breach or default of
a
material term or condition hereunder, Owner shall be entitled to the
following merchandising
royalty:
|
a.
|
If
either: (A) 25,000 or more units of the Property are sold as a
graphic
novel (provided that Owner submits documentation substantiating such
amount in form and substance acceptable to WDP in its sole discretion)
prior to commencement of principal photography of the Picture or
(B) the
Property is listed
among the top 200 titles on ICv2's Top 300 Comics Actual Index
(www.lcv2.com)
during any month prior to commencement of principal photography
of the Picture:
|
i.
|
At
such time, if ever, that the domestic i.e., United States and Canada)
theatrical box office gross revenues as reported in
Daily
Variety
(the "Domestic Box Office Revenue") of the Picture equals or exceeds
one and three-quarter times (1 -3/4x) the "Negative Cost" (as defined
in
Paragraph 3.2.d.i. below) of the Picture (the "Merchandise Royalty
Start
Point"), Owner shall be entitled to an amount equal to six and
one-half percent (6-1/2%) of 100% of "Net Merchandising Income" (as
defined in Paragraph 3.2.d.ii. below), if any, retroactive to first
dollar
of Net Merchandising Income, if any. (By way of example only, if
the
Negative Cost of the Picture equals $40,000,000, then Owner would
be
entitled to receive
an amount equal to six and one-half percent (6-1/2%) of 100% of Net
Merchandising Income, if any, retroactive to first dollar of Net
Merchandising
Income, if any, when and if the Picture achieves Domestic Box Office
Revenue of at least $70,000,000).
|
ii.
|
At
such time, if ever, that the Domestic Box Office Revenue of the Picture
equals or exceeds two times (2x) the Negative Cost of the Picture,
Owner
shall be entitled to an amount equal to seven and one-half percent
(7-1/2%) of 100% of Net Merchandising Income, if any, retroactive
to first
dollar of Net Merchandising Income, if
any.
|
iii.
|
At
such time, if ever, that the Domestic Box Office Revenue of the Picture
equals or exceeds two and one-half times (2-1/2x) the Negative
Cost of the Picture, Owner shall be entitled to an amount equal to
eight
and three-quarters percent (8-3/4%) of 100% of Net Merchandising
Income, if any, retroactive to first dollar of Net Merchandising
Income, if any.
|
iv.
|
Until
such time, if ever, that the Merchandise Royalty Start Point is achieved,
the Defined Receipts, if any, of the Picture shall include merchandising
royalties, as defined in Paragraph 2 of Schedule B to Exhibit
CB ("the CB Merchandising Royalties").
|
v.
|
Disgorgement.
If and when the
Merchandise Royalty Start Point
is achieved, an amount equal to the CB Merchandising Royalties
shall
be removed and disgorged from the Defined Receipts of the Picture.
The
CB Merchandising Royalties and components thereof, including without
limitation, revenues, royalties and associated costs utilized in
the calculation
of CB Merchandising Royalties which are removed and disgorged
from Defined Receipts pursuant to the preceding sentence shall
be
included in the calculation of Net Merchandising Income. An amount
equal
to any sums payable to Owner as a result of including CB Merchandising
Royalties in Defined Receipts shall be fully credited and deducted
from Owner's share of Net Merchandising Income, as applicable.
|
b.
|
If:
(A) 25,000 units of the Property are not sold as a graphic novel
prior to
commencement of principal photography of the Picture or (B) the
Property
is not listed among the top 200 titles on ICv2's Top 300 Comics Actual
Index (www.lcv2.com) during any month prior to commencement
of principal photography of the Picture, then, in lieu of the
merchandising royalty set forth in Paragraph 3.2.a. above, at such
time,
if ever, that the Picture achieves Start Point #1, Owner shall be
entitled
to an amount equal to five percent (5%) of 100% of "Net Merchandising
Income" (as defined in Paragraph 3.2.d. below), if any, retroactive
to
first dollar of Net Merchandising Income, if
any.
|
(i)
|
Until
such time, if ever, that Start Point #1 is achieved, the Defined
Receipts, if any, of the Picture shall include CB Merchandising Royalties.
|
(ii)
|
Disgorgement.
If and when the Picture
achieves Start Point #1, an amount equal to the CB Merchandising
Royalties
shall be removed and disgorged from those Defined Receipts included
in the
calculation of Start Point #1, to the extent that the removal and
disgorgement of such Defined Receipts does not prevent the Picture
from
achieving Start Point #1. The CB Merchandising Royalties and components
thereof, including without limitation, revenues, royalties and associated
costs utilized in the calculation of CB Merchandising Royalties which
are
removed and disgorged
from Defined Receipts pursuant to the preceding sentence shall be
included
in the calculation of the Net Merchandising Income. Start Point
#1 shall be recalculated in accordance with the prior sentence for
each
applicable accounting period until an amount equal to the total CB
Merchandising
Royalties that are removed and disgorged from Defined Receipts
are fully utilized and included in the calculation of the Net Merchandising
Income, as applicable. An amount equal to any sums payable
to Owner as a result of including CB Merchandising Royalties in Defined
Receipts shall be fully credited and deducted from Owner's share
of Net
Merchandising Income, as
applicable.
|
c.
|
Owner's
share of Net Merchandising Income set forth in this Paragraph
3.2 shall be inclusive of any amounts payable to Owner in connection
therewith pursuant to any applicable guild agreement (which shall
be
deemed paid at the minimum applicable payment required).
|
(i)
|
"Negative
Cost" as referenced herein shall be defined as an amount equal to
the sum
of the following: (a) the Cost of Production of the Picture as set
forth
in Paragraph 1.5 of Schedule 1. of WDP's Exhibit "CB" attached hereto
and
incorporated herein; provided, however, that solely for
the purpose of calculating Negative Cost hereunder, the third to
last
sentence
of Paragraph 1.5 of Schedule 1. of WDP's Exhibit "CB" shall be deleted;
(b) fifteen percent (15%) of the Cost of Production as set forth
in
Paragraph D. of WDP's Exhibit "CB" (the "15% Charge"); and (c) the
funding
charge set forth in Paragraph C. of WDP's Exhibit "CB" (the "Funding
Charge"); provided, however, with respect to any reference herein
to a multiple of the Negative Cost of the Picture, the applicable
multiplier
shall be applied only to the Cost of Production and not to the
15%
Charge or the Funding Charge which shall be included only once.
By
way of example only, and without limiting the foregoing, "two (2)
times
the Negative Cost" shall be calculated as an amount equal to the
sum of
the
following: a) two (2) times the Cost of Production; b) an amount
equal to
the 15% Charge; and c) an amount equal to the Funding Charge.
|
(ii)
|
With
respect to items of merchandising (including interactive games and
other
products and services) based on the Picture, "Net Merchandising
Income" as used herein shall mean as follows:
|
(a)
|
For
items sold by a licensee of WDP or licensee of an affiliate of WDP
("WDP
Affiliate"), the royalties WDP (or WDP Affiliate,
if applicable) receives from such licensee that are remaining
after WDP first deducts a percentage deduction of thirty percent
(30%) on
all such royalties and thereafter deducts any outof-pocket costs
and
royalties to third parties (including any royalty granted to Owner
in
connection with the Picture other than as the rights holder as set
forth
in this Agreement); or
|
(b)
|
For
items sold by WDP or WDP Affiliate at the wholesale or
retail level, at WDP's discretion, an amount equal to either: (A)
seven
percent (7%) of the wholesale price of such items sold by WDP at
the
wholesale
level (less a reasonable allowance for returns); or (B) seven percent
(7%) of fifty percent (50%) of the gross retail revenues of such
items
sold by WDP at the retail level (less a reasonable allowance for
returns)
after WDP first deducts a percentage deduction of thirty percent
(30%)
inclusive of subdistributor fees and thereafter deducts any out-ofpocket
costs and royalties to third parties (including any royalty granted
to
Owner in any capacity in connection with the Picture other than as
the
rights holder as set forth herein).
|
(c)
|
In
no event shall any items of merchandise be treated as falling under
both
provisions (i) and (ii) above. Posters furnished to exhibitors for
display
or promotion, advertisements, jackets of video discs and cassettes
and
phonorecords, printed programs and promotional novelizations of the
story
of the Picture and other publications
relating to the Picture, soundtrack recordings from the Picture,
and
distribution of promotional material and exhibition of any "trailer"
or
Featurette (as defined in Paragraph 16 below) for the Picture, shall
not
be considered "merchandise."
|
e.
|
Owner
shall have the right to consult with WDP with respect to merchandise
in
connection with the Picture; provided that in the event of disagreement
WDP's decision shall be final and binding. Owner hereby acknowledges
that other parties may have similar consultation rights with WDP
in
connection with the Picture. Owner's right of consultation shall
be
personal to Owner and may not be assigned or delegated to any third
party
|
a.
|
"Broadway"
Production. If WDP exercises the Stage Rights (as defined
in Paragraph 5.1.f. below) hereunder and WDP produces a "first-class"
(as
such term is customarily defined in the legitimate stage industry)
live
stage production
based on the Property, and such stage production is performed in
New
York on "Broadway" (a "Broadway Production"), then, provided Owner
is not
in
breach or default hereunder, Owner shall be entitled to receive the
following, as
applicable:
|
(1)
|
the
sum of $10,000 upon the date (the "Opening Date") of the first paid
public
performance of such Broadway Production in New York on "Broadway"
(if
ever);
|
(2)
|
the
additional sum of $10,000 at such time, if ever, that such Broadway
Production has been continuously performed in New York on "Broadway"
for a
period of one (1) year from the Opening Date;
and
|
(3)
|
the
additional sum of $10,000 at such time, if ever, that such Broadway
Production has been continuously performed in New York on "Broadway"
for a
period of two (2) years from the Opening
Date.
|
b.
|
"Off-Broadway"
Production. If WDP exercises the Staqe Rights
hereunder and WDP produces a "first-class" (as such term is customarily
defined in the legitimate stage industry) live stage production based
on
the Property, and such stage production is performed in
New York
"Off-Broadway" (i.e., any theatre in the city of New York, seating
no less
than ninety-nine [99] persons and no more than four hundred and
ninety-nine
[499] persons) (an "Off-Broadway Production"), then, provided Owner
is not
in breach or default hereunder, Owner shall be entitled to receive
the following, as applicable:
|
(1)
|
the
sum of $5,000 at such time, if ever, that such Off-Broadway
Production has been continuously performed in New York "Off-Broadway"
for
a period of one (1) year from the date (the "Off-Broadway Opening
Date")
of the first paid public performance of such Off-Broadway Production
in
New York "Off-Broadway"; and
|
(2)
|
the
additional sum of $5,000 at such time, if ever, that such Off-Broadway
Production has been continuously performed in New York "Off-Broadway"
for
a period of two (2) years from the OffBroadway Opening
Date.
|
d.
|
Except
as set forth in Paragraphs 3.3.a and 3.3.b. above, Owner shall
not be entitled to any compensation in connection with WDP's exercise
of
the Stage Rights set forth in Paragraph 5.1.f.
above.
|
a.
|
On-Screen:
On a separate card (which card may be shared in WDP's
sole discretion with other source material on which the Picture is
based)
in the main titles, if any (otherwise in the end titles), below or
after
the title, in substantially the form of "Based on the Platinum Studios
graphic novel created by Scott Mitchell Rosenberg," or if the title
of the
Picture is materially different from that of the Property, then said
credit shall be substantially in the form of "Based on the Platinum
Studios graphic novel `Unique' created by Scott Mitchell Rosenberg,"
in an average size of type not less than the larger of (i) fifty
percent
(50%) of the average size of type of the title of the Picture on
screen or
(ii) one hundred percent (100%) of the average size of type utilized
to
accord the screenwriter
credit on screen.
|
b.
|
Paid
Ads: In paid ads issued or controlled by WDP, in the billing block
portion only, if any (i.e., if such otherwise applicable paid ad
does not
have a billing block, Owner shall not be entitled to receive credit
in
such paid ad), below
or after the regular (i.e., not artwork) title of the Picture, in
substantially the form "Based on the graphic novel by Scott Mitchell
Rosenberg," or if the title of the Picture is materially different
from
that of the Property, then said credit shall be substantially in
the form
of "Based on 'Unique' by Scott Mitchell Rosenberg," in an average
size of
type not less than the larger of (i) thirty-five percent (35%) of
the
average size of the regular (i.e., not artwork) title of the Picture
in
such billing
block or (ii) one hundred percent (100%) of the average size of type
utilized
to accord the screenwriter credit in such billing
block.
|
c.
|
Excluded
Ads: In the billing block portion only, if any, of any so-called
excluded ads issued or controlled by WDP in which the screenwriter
is
accorded credit in such billing block (i.e., if such otherwise applicable
excluded ad does not have a billing block, then Owner shall not be
entitled to receive credit in such excluded ad), below or after the
regular (i.e., not artwork) title of the Picture in such billing
block, in
substantially the form "Based on the graphic novel
by Scott Mitchell Rosenberg," or if the title of the Picture is materially
different
from that of the Property, then said credit shall be substantially
in the
form of "Based on `Unique' by Scott Mitchell Rosenberg," in an average
size of type not less than the larger of: (i) thirty-five percent
(35%) of
the average size of type of the regular (i.e., not artwork) title
of the
Picture in such billing block; or (ii) one hundred percent (100%)
of the
average size of type utilized to accord the screenwriter credit in
such
billing block. Notwithstanding the foregoing, Artist shall
not be entitled to receive credit in congratulatory, nomination and/or
award ads, special ads, ads specially exempted by Paragraphs 8-203d.,
8-203f. and 8203g. of the DGA Basic Agreement, ads announcing a personal
appearance, radio ads and the audio portion of teasers, trailers
and
television ads.
|
4.2
|
WDP
shall accord on screen credit in the end titles of the Picture to
the
author
and the illustrator of the Property in substantially the form "Graphic
novel written by
Dean Motter and illustrated by Stefano Cardoselli," or if the title
of the
Picture is materially
different from that of the Property, then said credit shall be
substantially in the form
of "Based on `Unique' written by Dean Motter and illustrated by Stefano
Cardoselli."
|
4.3
|
As
used herein, "size" means height, width and thickness. All other
characteristics
of Owner's credit under this Agreement shall be at WDP's sole discretion.
WDP's inadvertent failure to accord credit in accordance with the
provisions of this Paragraph 4. shall not be deemed a breach of this
Agreement. Within a reasonable
time after receipt of written notice from Owner specifying a material
failure to accord Owner credit in accordance with this Agreement,
WDP
shall use reasonable efforts to cure prospectively any such material
failure to accord Owner credit hereunder with regard to positive
prints
and/or advertising materials, the masters for which are created after
the
date of WDP's receipt of such notice. WDP shall use reasonable
efforts
to inform all third party subdistributors of the credit obligations
contained herein; provided, however, that the failure of said
subdistributors to comply with the abovecredit
requirements shall not constitute a breach of this
Agreement.
|
5.1
|
Owner
hereby specifically and irrevocably grants to WDP, solely, exclusively,
throughout the universe and in perpetuity, all right, title and interest
of every kind and nature in and to the Property (subject only to
the
reserved rights enumerated in Paragraph 6. below), including without
limitation the following:
|
a.
|
The
right to develop, produce and exploit Motion Pictures (including
without
limitation, Theatrical Motion Pictures and Television Motion Pictures
and
Sequels and Remakes thereof) based upon or adapted from all or any
part of
the Property throughout the universe, in perpetuity and in all languages
and all elements
therein for all now known or hereafter existing uses, media, and
forms,
including, without limitation, all copyrights (and renewals and extensions
thereof), motion picture, television, digital television, videocassette
and video or laser disc, any
computer-assisted media (including, but not limited to, CD-ROM, CD-I
and
similar disc systems, interactive media and multi-media and any other
devices or methods now existing or hereafter devised) and allied
rights
therein.
|
b.
|
The
right to produce Sound Records in any format or medium now known
or
hereafter devised of all or any part of the Property and any and
all
Motion
Pictures (including, without limitation, Theatrical Motion Pictures
and
Television
Motion Pictures and Sequels and Remakes thereof) produced hereunder,
specifically including the exclusive motion picture synchronization
rights
in the Property and each and every part thereof, and the exclusive
right
to use all or any part of the Property upon the parts of instruments
serving to reproduce
the same mechanically.
|
c.
|
The
right to adapt, use, dramatize, arrange, change, vary, modify,
alter,
transpose and make musical or nonmusical versions of the Property
and
any
parts thereof including, without limitation, the characters; to add
to,
interpolate
in and subtract-or omit from the Property, plot, subplots, themes,
situations,
action, titles, language, speech, songs, music, lyrics, dancing,
choreography,
sound, sound effects, scenes, dialogue, incidents, characters and
characterizations
thereof; to translate any of the foregoing into all languages; to
include
in Motion Pictures and other items provided for in this Paragraph
5. such
plot,
subplots, themes, situations, action, titles, language, speech, songs,
music, lyrics,
dancing, choreography, sound, sound effects, scenes, dialogue, incidents
and
characters, characterizations and other material (whether or not
based
upon, or
taken from, the Property) as WDP, in its sole and uncontrolled discretion,
may deem
advisable, it being the intention hereof that WDP shall have the
exclusive, absolute
and unlimited right to use the Property, and each and every part
thereof,
for motion picture purposes (and all other purposes granted hereunder)
in
any manner it may, in its uncontrolled discretion, deem advisable
with the
same
force and effect as though WDP were the sole author of the Property,
all
without
in any way being accountable or liable to Owner for any use that
WDP
may
make thereof, excepting only the compensation and screen credit
obligations
(if any) to Owner contained herein. Owner hereby waives the benefits
of any provision of law known as "droit moral," or any similar laws,
and
agrees
not to institute, support, maintain or authorize any action or lawsuit
on
the ground
that any Motion Pictures or Sound Records, or other items produced
hereunder
in any way constitute an infringement of any of Owner's "droit moral"
or
a defamation or mutilation of any part thereof, or contain unauthorized
variations,
alterations, modifications, changes or translations. Owner shall
not
have
any right, title or interest whatsoever in or to any plot, subplot,
story,
character,
music, lyrics, dialogue, screenplay or other material of any kind
created
by or for WDP in the exercise of WDP's rights hereunder, or in any
Motion
Pictures produced hereunder or any material created by WDP in connection
therewith.
|
d.
|
The
right to telecast directly from the performance to the audience
on
live television any adaptation of the Property.
|
e.
|
The
right to broadcast and exploit the Property or any part thereof including,
without limitation, the characters, and the right to broadcast and
exploit
all or any part of any Motion Picture (including, without limitation,
Theatrical Motion
Pictures and Television Motion Pictures and Sequels and Remakes
thereof)
or Sound Record produced hereunder, by radio and television, digital
television, videocassette, video or laser disc and computer games,
any
computer assisted media (including, but not limited to, CD-ROM, CD-I
and
similar disc systems,
interactive media and multi-media and any other devices or methods
now
existing or hereinafter devised), or otherwise, whether by electrical
transcription,
film, tape, or otherwise, in any language or medium.
|
f.
|
The
right to perform the Property or adaptations thereof on the spoken
stage with actors appearing in person in the immediate presence of
the
audience
("Stage Rights"), including, without limitation, the sole and exclusive
right,
in perpetuity, throughout the universe, to exercise all theme park
rights
with respect to the Picture and/or the Property, including without
limitation the right to use
the Picture, the title of the Picture, characters therefrom and
elements thereof
(including, without limitation, characters, scenes, music, costumes
and
sets
and/or footage from the Picture) in WDP's (its parent and the
subsidiaries, licensees
and affiliates thereof, collectively "Disney" for purposes of this
Paragraph
5.1) existing and future theme parks, resorts, attractions, so-called
location-based
and/or regional entertainment centers, cruise ships and any of
the
foregoing licensed or operated by Disney (collectively, "Theme Parks"),
and in
any Disney-themed variety show (e g„ Disney's World-On-Ice, any Disney
Circus)
or other arena type show, in any manner and for any use, whether
now
known
or hereafter invented or devised, including, but not limited to,
in
connection
with live shows in Theme Parks, theatrical stage performances in
Theme
Parks, so-called "walk-around" performances or characters and/or
as the
basis in whole or in part for any ride or attraction in any Theme
Park,
and to make
sponsorship deals in connection with any of the foregoing, with no
obligation
whatsoever, financial or otherwise, to Owner.
|
g.
|
The
right to produce and publish a novelization of the Picture; for
purposes
of advertising and promotion of the Picture and not for sale, the
right to
produce and publish (with or without illustrations by photographs,
drawings or cartoons)
stories, synopses, excerpts, summaries, resumes and/or fictionalizations
based upon or adapted from the Property or any part or element thereof
including, without limitation, the characters, and to publish "making
of
books
concerning the Picture. WDP shall not publish other publications
including
comic books or graphic novels based upon the Picture without first
obtaining
Owner's permission.
|
h.
|
The
right to write and prepare screenplays, teleplays,
treatments, storyboards
and all other plans, specifications and designs for Motion Pictures
and
any Sound Records produced hereunder, and to cause musical compositions,
including both words and music, utilizing or based upon or adapted
from all or any part of the Property or any title or titles thereof
to be
written and composed, and to include such musical compositions in
Motion
Pictures and Sound Records produced hereunder.
|
L
|
The
right to manufacture, sell, furnish, supply and distribute products,
by-products, services, facilities, merchandise and commodities of
every
nature and description now known or hereafter devised, including,
but not
limited
to, still photography, drawings, posters, artwork, toys, games, items
of
wearing
apparel, foods, beverages and similar items, which make reference
to or
are based upon or adapted from the Property or any part thereof or
any
Motion Picture
produced hereunder and the right to make trade deals and commercial
tie-ups
of all kinds involving the Property, or any part thereof, including,
but
not limited
to, the characters.
|
j.
|
The
right to copyright Motion Pictures (including, without limitation,
Theatrical
Motion Pictures and Television Motion Pictures and Sequels and
Remakes
thereof) and any versions thereof, Sound Records, musical compositions,
screenplays, teleplays, characters and all other items provided for
in
this Paragraph 5. and secure copyright and/or trademark registration
and
protection
thereof in all countries and territories where such protection is
available,
in WDP's own name or otherwise, together with the right to manufacture
copies thereof, and to distribute, sell, vend, lease, license, exhibit,
transmit,
broadcast, project, reproduce, publish, use, perform, advertise,
publicize,
market, exploit, turn to account and derive revenue in any form or
manner
therefrom, without any territorial restriction whatsoever, by any
and all
media,
methods, systems and processes now or hereafter known, invented,
used
or contemplated, specifically including television, digital television,
video and
computer games, video or laser discs, videocassettes and any
computer-assisted
media (including, but not limited to, CD-ROM, CD-I and similar disc
systems,
interactive media and multi-media and any other devices or methods
now
existing or hereafter devised), and the right to import or export
such
copies into
or out of any territory without restriction. It is further expressly
understood and
agreed that Motion Pictures and all other items that may be produced
hereunder
shall constitute independent derivative works, and WDP and its
successors,
assigns and licensees shall have the perpetual right to exercise
the
rights
granted in this Paragraph 5.1.j. irrespective of the expiration,
termination, transfer
or renewal of any copyright owned or controlled by Owner, or any
heirs,
executors,
widow, widower, children, successors or assigns of Owner. WDP shall
in no event have any less rights by reason of this Agreement than
any
member
of the public may now or hereafter
have.
|
k.
|
Insofar
as Owner is concerned, the right to use a translation in any language
of the title or titles by which the Property or any part thereof
are now
known
or may hereafter be known as the title or titles of the Motion Picture
(whether
or not based upon or adapted from the Property) produced hereunder,
and
the right to exploit, distribute and exhibit any Motion Picture produced
hereunder
under any other title or titles that WDP may deem proper in its
uncontrolled
discretion.
|
1.
|
The
right to use any of the rights set forth in this Paragraph 5. in
connection
with the promotion, publicizing and advertising of any Motion Picture
or
other production relating to the Property or the exploitation thereof
and
in connection
with any commercial tie-up, or the manufacture, advertising, distribution
and/or sale of any products, commodities or services in connection
therewith.
|
M.
|
The
right to utilize the rights granted hereunder in connection with
any
so-called "Author-Written Sequel(s)" (i.e., a literary property [graphic
novel, comic book, story, novel, drama or otherwise], whether written
before or after the Property and whether written by Owner or by a
successor-in-interest of Owner using one or more of the characters
appearing in the Property, and whose plot is substantially different
from
that of the Property).
|
n.
|
All
rights, including all exclusive exploitation rights, of every kind
and
nature (including any and all copyrights and neighboring rights,
to the
extent such assignment is allowed by law) in and to the Property
to WDP.
All rights to such Property are owned by WDP solely and exclusively,
for
the duration of the rights in each country and area and space, in
all
languages, and throughout the universe. Owner and WDP are aware and
hereby
acknowledge that new rights to the Property may come into being and/or
be
recognized in the future, under the law and/or in equity (hereafter
the
"New Exploitation Rights"), and Owner intends
to and does hereby grant and convey to WDP any and all such New
Exploitation
Rights to the Property granted by Owner hereunder. Owner and WDP
are also aware and do hereby acknowledge that new (or changed) (1)
technology,
(2) uses, (3) media, (4) formats, (5) modes of transmission and (6)
methods of distribution, dissemination, exhibition or performance
(hereafter the "New Exploitation Methods") are being and will inevitably
continue to be developed
in the future, which would offer new opportunities for exploiting
the
Property.
Owner intends and does hereby grant and convey to WDP any and all
rights
to such New Exploitation Methods with respect to the Property. Owner
hereby
agrees to execute any document WDP deems in its interest to confirm
the
existence of the preceding and to effectuate its purpose to convey
such
rights
to WDP, including without limitation the New Exploitation Rights
and any
and all rights to the New Exploitation Methods. Owner further hereby
agrees that Owner will not seek (1) to challenge, through the courts,
administrative governmental
bodies, private organizations, or in any other manner the rights
of WDP to
exploit the Property by any means whatsoever or (2) to thwart, hinder
or subvert
the intent of the grants and conveyances to WDP herein and/or the
collection by WDP of any proceeds relating to the rights conveyed
hereunder.
|
o.
|
All
other rights of every kind and character whatsoever now known or
unknown
in and to the Property, subject only to the rights specifically reserved
to Owner in Paragraph 6. below.
|
5.2
|
WDP
shall have all rights herein granted to it in all existing and future
versions,
translations, dramatizations, arrangements, revisions, supplements
and
reissues
of the Property written or published by or with the authority of
Owner and
Owner's
successors, assigns and licensees, as well as all prior drafts, notes,
research, source material and other works owned or controlled by
Owner
upon which the Property is based and from which the Property is adapted.
All rights granted WDP under this Agreement shall be cumulative,
and WDP
may exercise or refrain from exercising any one or more of said rights
separately from, simultaneously, together or in connection with any
other
rights granted to WDP hereby or obtained by WDP from other sources,
and
regardless of whether said rights are granted in the disjunctive
or
conjunctive.
|
6.1
|
Publication
Rights. Owner shall have the right to publish, distribute and
promote
(provided such promotion shall be consistent with the Reserved Rights
set
forth
in this Paragraph 6 [e.g_, any such promotion shall be static, unless
otherwise approved
in advance in a writing signed by WDP in its sole good faith
discretion]) printed
versions of the Property on a worldwide basis in comic book form
i.e.,
comic books,
comic strips and graphic novels), including translations and reissues,
whether hardcover
or softcover, in magazines or other periodicals, whether in installments
or otherwise,
in any means now known or hereafter devised for the presentation
of text
or comic art by various delivery systems (e.g., electronic retrieval
and
internet transmissions
[provided comic art is static unless otherwise approved in advance
in a
writing
signed by WDP in its sole good faith discretion; provided, and by
way of
example
only, WDP hereby acknowledges that the minimal motion depicted in
Owner's
2003 holiday card
submitted
to WDP (http://www.platinumstudios.com/holiday
card 2003.php), a screen
grab of which
is attached hereto and incorporated herein by this reference as
Exhibit
"A," would be approved to the extent the characters depicted do not
have
audible
voices; provided further, that WDP acknowledges that audible narration
by
an offscreen narrator consisting of 200 words or less would be
acceptable]), which may be copyrighted in the name of Owner, all
subject
to WDP's rights provided for in Paragraph 5.
above. Notwithstanding anything to the contrary above, said reserved
publication rights
do not include picture books, coloring books, novelizations and other
publications that do not contain the story line of the Property in
written
words, all of which are included
in the rights granted to WDP. In addition, Owner shall cause the
Publisher(s) of
the Property to execute and deliver to WDP the Publisher's release
in the
form attached
hereto as Schedule II (Publisher's Release) within thirty (30) days
after
the date such agreement is fully
executed.
|
6.2
|
WDP
and Owner hereby acknowledge that Owner owns world wide comic book
and
graphic novel publication rights to the
Property.
|
6.3
|
Direct
Market Merchandising. The non-exclusive right to continue to
manufacture,
sell and/or distribute merchandise ("Pre-Existing Merchandise") based
on
the Property
(other than the "Film Elements" [as defined in Paragraph 6.4 below],
which
rights are
granted exclusively to WDP) solely in the so-called "Direct Market"
(as
defined below) pursuant
to binding agreements entered into prior to the date which is eight
(8)
weeks prior to the
commencement of principal photography of the Picture ("Pre-Existing
Merchandise Date").
A complete list of all current agreements of Owner in connection
with
Pre-Existing Merchandise
("Pre-Existing Merchandise Agreements") in existence as of the date
of
execution
of the Agreement is attached hereto as Schedule V. Commencing on
the date
of this
Agreement, Owner shall only enter into merchandising agreements with
respect to the Property
which possess an initial term ending one (1) year from the first
shipping
date (which shipping
date shall be no more than six [6] months from commencement of such
merchandising
agreement) and optional or renewal terms of six (6) months or less.
Owner
acknowledges
that after the Pre-Existing Merchandise Date, Owner shall neither
enter
into any
new merchandising agreement nor renew or allow to be renewed or exercise
or allow to be
exercised any option to extend the term of any merchandising agreement
in
connection with
the Property. For purposes of this Agreement, "Direct Market" shall
mean
and refer to the
economic market comprised of (i) comic book, science-fiction, fantasy,
and/or hobby specialty
stores and the distributors thereto; and (ii) such other comic-book
specialty stores and
comic-book mail-order retailers that purchase some or all of their
new-comics inventory on
predominantly a nonreturnable basis from (A) publishers directly,
(B)
comics-specialty distributors
such as, but not limited to, Diamond Comic Distributors, Inc., and/or
(C)
specialty licensees
such as, but not limited to, Dynamic Forces, Inc. or American
Entertainment. Owner
shall be strictly prohibited from using WDP's name or the name of
WDP's
parent, subsidiaries,
subsidiaries of its parent, affiliates, associates, successors and
assigns
or from making
any reference to the Picture or using any Film Elements, in connection
with, among other
things, the manufacturing, selling, advertising and/or distribution
of the
Pre-Existing Merchandise
without the express prior written approval of a WDP Business Affairs
executive. For
purposes of clarification, WDP's right to manufacture, sell and/or
distribute merchandise based
on the Property shall be non-exclusive on or after the date of WDP's
exercise of the Option,
as more fully set forth in Paragraph 5, above, and shall be exclusive
commencing on the
Pre-Existing Merchandise Date. In connection with Pre-Existing
Merchandise, Owner (a) shall
maintain in full force and effect customary insurance for licensees
with
respect to the manufacture,
distribution and sale of (or any other activity[ies] which involve)
Pre-Existing Merchandise
naming those Owner must indemnify in Paragraph 8, below, as additional
insureds;
and (b) shall otherwise comply with the terms of this Agreement.
|
(i)
|
Owner
shall have no right in the exercise of any of the Reserved
Rights to use (or to authorize third parties to use) any "Film
Elements" (as defined below) or to promote, publicize, market,
advertise or otherwise exploit the Reserved Rights in such a manner
as to
tie or connect such Reserved Rights with the Picture
or any other production produced by WDP hereunder. As used
herein, "Film Elements" shall mean WDP's name or the name of WDP's
parent,
subsidiaries of its parent, affiliates, successors and
assigns (and any trademarks, copyrights, service marks, or logos
of the foregoing) and any element specifically created, written,
authorized or licensed by or on behalf of WDP (or WDP's parent,
subsidiaries of its parent, affiliates, successors or assigns), whether
in
connection with any Theatrical Production or Television Production
or
exploitation of the Rights or otherwise, including but not
limited to, screenplay, teleplay, title (other than the title "Unique"),
music, lyrics, themes, costumes, designs, plots, scenes, logos, settings,
artwork (including key artwork), characters, advertising
and publicity materials or other
material.
|
(B)
|
Nothing
in this Paragraph 6 shall restrict in any manner WDP's
right to design, manufacture, license, sell, display or exploit
posters
furnished exhibitors for display or promotion, advertisements,
jackets
of video devices and sound records relating to any Theatrical Production
or Television Production and distribution of promotional materials
and products (including but not limited to the licensing of any
"give
away" or other items as part of a commercial tie-up arrangement for
any
Theatrical Production or Television Production) and exhibition of
any
"trailer"
or promotional films relating to any Theatrical Production or Television
Production.
|
(C)
|
It
is expressly agreed that Artist's reserved rights under Paragraphs
6.1 and 6.3 above relate only to the Property and not to any screenplay,
characters, teleplay, music, lyrics, sequels or other material written
by
or created by or for or authorized by WDP, even though the same may
contain characters or other elements contained in the
Property.
|
7.1
|
Owner
is the sole owner of all rights (including the Rights, as defined
in
Paragraph 5. above) herein granted or intended to be granted and
has full
power and authority to grant said rights to
WDP;
|
7.2
|
Owner
has full power and authority to agree to restrictions upon the
exercise
of the rights (if any) reserved to Owner, including those restrictions
(if
any) as more particularly set forth in Paragraph 6.
above;
|
7.3
|
None
of the rights granted to WDP hereunder has been granted, encumbered,
or otherwise disposed of in any manner to any Person, firm or other
entity
and Owner has not granted any other rights to the Property; no Motion
Picture based in whole or in part upon the Property has been produced
or
authorized by or with the knowledge
or consent of Owner; neither the Property nor any version thereof
nor any
play
or dramatic adaptation based thereon in whole or in part has been
published or presented
or authorized on television, stage or on the spoken stage by or with
the
knowledge
or consent of Owner;
|
7.4
|
Owner
has not done or omitted to do and will not do or omit to do any act
.or
thing by license, grant, or otherwise, which will or may impair or
encumber any of the rights herein granted or interfere with the full
enjoyment of said rights;
|
7.5
|
There
are no claims or litigation pending or threatened which will or might
adversely affect any of the rights herein granted to
WDP;
|
7.6
|
The
Property is original with Owner; neither the Property nor any part
thereof
is taken from or based upon any other material except material wholly
owned by Owner; and neither the Property nor any part thereof, or
the
exercise by WDP of the rights herein granted, will violate or infringe
upon the trademark, trade name, copyright, patent, and to the best
of
Owner's knowledge (or that which Owner should know in the exercise
of
reasonable diligence and prudence) literary, dramatic, musical, artistic,
personal,
civil or property right or any other right of any Person, or invade
the
right of privacy or constitute a libel or slander of any
Person;
|
7.7
|
The
Property is not in the public domain, and enjoys, and will enjoy,
either
statutory or (to the extent that it may exist) common law protection
in
the United States and all countries adhering to the Berne and Universal
Copyright Conventions; and the rights granted to WDP hereunder are
and
will be exclusive; and
|
7.8
|
Attached
hereto, marked "Schedule I" and made a part of this Agreement by
this
reference, is a statement of all publications, if any, prior uses,
if any,
prior versions,
adaptations and translations, if any, and copyright status of the
Property. Such
statement shall also set forth the existence, if any, of any valid
agreement with third parties for the publication or dramatic production
of
the Property.
|
8.1.
|
Owner
will defend, indemnify, make good, save and hold harmless WDP,
its
parent, subsidiaries, subsidiaries of its parent and/or affiliated
companies, the officers
and directors of the foregoing, and its successors and assigns, from
and
against
any losses, damages, costs, liabilities, charges, reasonable attorneys'
fees, recoveries,
actions or judgments from a court of competent jurisdiction, penalties,
guild fees or awards, expenses and any other losses whatsoever which
may
be obtained against, imposed upon or suffered by WDP, its parent,
subsidiaries, subsidiaries of its parent and/or affiliated companies,
the
officers and directors of each of the foregoing and its successors
and/or
assigns, by reason of the breach or alleged breach of any warranty,
covenant, agreement or representation herein made by
Owner.
|
8.2.
|
Except
with respect to (i) matters constituting a breach by Owner of any
of the
representations, warranties and/or agreements contained herein, or
(ii)
gross negligence,
willful misconduct, or recklessness by Owner, or (iii) a third party
claim
relating,
referring, or arising out of actions by Owner that are outside the
course
and scope of Owner's services in connection with the Picture, WDP
agrees
to indemnify Owner and hold Owner harmless from and against any and
all
damages and expenses (other than with respect to any settlement entered
into without WDP's written consent or claim to which WDP has not
been
notified) arising out of any third party claim against Owner resulting
from WDP's development, production, distribution and/or exploitation
of
the Picture or any element thereof and shall provide Owner with a
defense
(with counsel
of WDP's choice), provided, Owner cooperates with WDP and follows
WDP's
reasonable instructions in connection with such claim. Nothing herein
shall be deemed a
waiver of WDP's right of subrogation, except that WDP shall waive
its
right of subrogation
to the extent such damages and expenses are covered by this indemnity.
The
foregoing shall not limit WDP's right to include any such damages
and
expenses in the negative cost of the Picture or as a distribution
cost for
the Picture.
|
9.1
|
Owner
hereby grants to WDP all of Owner's right, title, and interest in
and
to
any and all agreements, assignments, releases and other instruments
or
documents in
writing (collectively "Instruments") heretofore or hereafter executed
in
favor of Owner, or
any predecessor of Owner, insofar as said Instruments grant or purport
to
grant to Owner,
or any such predecessor, any of the rights, privileges and property
herein
granted
to WDP, together with the full benefit of all representations, warranties
and agreements
made by any party in favor of Owner or any such predecessor, insofar
as
the
same pertain to or affect any of the rights, privileges and property
herein granted to WDP.
|
9.2
|
Owner
represents and warrants that: (a) any such Instruments (if any
exist)
have not been amended, modified or cancelled in any way, and are
in full
force and
effect as originally signed; (b) Owner has not granted or assigned
any
right, title or interest
heretofore acquired by Owner in, to or under said Instruments in
a manner
inconsistent
herewith; and (c) there has been paid to the party or parties entitled
thereto all
sums which have heretofore become payable under any of said Instruments,
and, except
as herein specifically provided, Owner will hereafter pay or cause
to be
paid, to the
party or parties entitled thereto, all sums which may hereafter accrue
under said Instruments.
|
10.1
|
Owner
further grants and assigns to WDP an exclusive, irrevocable license,
in perpetuity, in and to any and all of Owner's right, title and
interest
in and to any and all copyrights in and to the Property and each
and every
part thereof contained therein, together with all benefits of said
copyrights and all remedies held thereunder, and all actions and
causes of
action for infringement or violation of said copyrights, or any other
rights in the Property or relating thereto, and all damages, profits,
penalties and other recoveries and all other rights of every kind
and
character which Owner may now or hereafter have directly or indirectly
as
a result of any such infringement or violation,
but only insofar as said copyrights pertain to or affect any of the
rights, privileges and property herein granted to
WDP.
|
10.2
|
Owner
agrees: (a) to prevent the Property from becoming injected into the
public
domain; (b) to cause to be affixed to each copy of the Property or
any
part thereof published or offered for sale by or with the authority
of
Owner notice of copyright
complying in all respects with the United States Copyright law and
with
the Universal Copyright Convention; (c) to register the Property
wherever
necessary for such protection; (d) to contract henceforth for the
benefit
of WDP for the above but
not the obligation, to complete any such copyright assignment, fill
in any
blanks which
may be left therein (including dates, Copyright Office registration
information, etc.),
execute the same in Owner's name, or obtain execution thereof by
others,
as the case may be, and record the same in the United States Copyright
Office, or elsewhere, as WDP sees fit. WDP shall provide Owner with
copies
of such documents and five (5) days (reducible in WDP's sole discretion
due to exigencies) to execute such documents before WDP executes
as
Owner's attorney-in-fact.
|
11.1
|
Grant:
WDP grants to Owner and Owner hereby accepts a non-exclusive, worldwide
royalty-free license to use the trademarks (i.e., the words, names,
designs, logos, brands, symbols, devices, trade dress or any combinations
thereof) presently used or hereafter devised in connection with the
Property (collectively, the "Marks") in connection with Owner's Reserved
Rights as set forth in Paragraph 6 above (i.e., the right to publish,
distribute and promote printed versions of the Property in comic
book form
[the "Comic Books"] and the right to manufacture, sell and/or distribute
merchandise
based on the Property solely in the so-called "Direct Market" [the
"Direct-Market
Merchandise"]). The grant of rights herein shall specifically not
include
use of the
Marks in connection with publications or merchandise other than the
Comic
Books or
Direct Market Merchandise or merchandise associated with the Picture
or
any other productions
or derivative works produced by WDP hereunder or based upon the Film
Elements.
|
11.2
|
Term:
The license granted in this Paragraph 11 shall last in perpetuity,
unless
sooner terminated by the terms of this Agreement or pursuant to Owner's
reversion
rights set forth Paragraph 17 below. In the event of a breach of
this
Paragraph
11 by Owner, all use of the Marks by Owner shall cease immediately
upon
Owner's
receipt of notice from WDP of the breach and termination. Upon termination
of the
license granted in this Paragraph 11, all rights granted in this
Paragraph
11 will revert
to WDP.
|
11.3
|
Right
of Owner to Sublicense: Any of the rights granted under this
Paragraph
11 may be sublicensed by Owner during the term of the license. Any
such
sublicense granted by Owner hereunder shall be terminated upon the
termination of this
license.
|
11.4
|
No
Assignment: This license shall be non-assignable. Any attempt by
Owner
to assign this license shall constitute a material
breach.
|
(a)
|
Owner
acknowledges that if any of the Comic Books or Direct-Market
Merchandise were of inferior quality, the substantial goodwill established
in the Marks would be impaired. Accordingly, Owner agrees that the
goods
comprising
the Comic Books and all Direct-Market Merchandise will (i) be of
high
quality,
(ii) comply with all international, federal, state and local laws
and
(iii) be fit
for consumers' anticipated uses.
|
(b)
|
Owner
shall submit to WDP each Comic Book and/or item of Direct-Market
Merchandise to assure compliance with the quality control standards
set forth in Paragraph 11.5(a) above. Any approval by WDP shall not
be
deemed to constitute an opinion by WDP that any item is safe or complies
with all applicable laws. Owner shall remain fully and solely responsible
for all product safety and for ensuring that all Comic Books and
all
Direct-Market Merchandise
are in compliance with all applicable
laws
|
(c)
|
In
the event that the above-stated quality standards are not met or
maintained throughout the term of this license, WDP has the right
to
require that Owner and its affiliates meet the quality standards
as set
forth in Paragraph 11.5 (a) above within a reasonable period of time.
|
11.6
|
Alteration
to the Work: Owner may not make material alterations or changes
to the quality of the Comic Books and Direct-Market Merchandise or
the
Marks after
approval by WDP as set forth in 11.5(b) above without seeking permission
from WDP.
|
11.7
|
Intellectual
Property Rights: Owner agrees that it will not, during the term
of
this license or thereafter, attack the title or any rights of WDP,
or any
related company
of WDP, in and to the Marks. Owner agrees to assist WDP and to cooperate
fully
with WDP to procure any protection or to protect any of the rights
of WDP
to the Marks.
|
11.8
|
Notification
of Third Party Infringement: Owner will notify WDP of any infringement,
imitation or act inconsistent with WDP's ownership of the Marks of
which
Owner
becomes aware. WDP shall in its sole discretion determine whether
or not
to take any action with respect to. such infringement or act and
Owner
agrees to reasonably cooperate
and to comply with any requests by WDP for assistance in pursuing
such
action.
|
11.9
|
Ownership:
Owner's use of the Marks shall inure to WDP's benefit. Owner
acknowledges and agrees that WDP is the exclusive owner of the Marks,
and
of any
trademark incorporating a Mark, as well as any future trademark rights
created by other
use on or in association with the Comic Books or Direct-Market
Merchandise. Without
limiting the foregoing, if Owner for any reason is found to have
obtained
any interest
in the Marks (or of any trademark incorporating a Mark, as well as
any
future trademark
rights created by other use on or in association with the Comic Books
or
Direct-Market
Merchandise), Owner shall assign those rights to WDP, together with
the
goodwill
attaching to that part of the business in connection with which such
trademarks are
used.
|
14.1
|
"Copies"
with reference to a Motion Picture or Sound Record, means and includes
any
negative or positive print, dupe, negative, video or other electronic
tape
recording, disc or other physical article of any kind produced, reproduced
or re-recorded by means of any photographic, electrical, electronic,
mechanical, computer-assisted media or other processes or devices
now or
hereafter known, invented, used or contemplated
on which such Motion Picture and/or Sound Record or any part thereof,
is
printed, imprinted, recorded, reproduced or duplicated, together
with any
package, cartridge,
cassette or other container in which the same may be distributed
or
sold.
|
14.2
|
"Copies"
with reference to a screenplay or teleplay, means any typewritten
or
printed copies thereof in substantially the form used in connection
with
production of the Motion Picture involved, whether or not accompanied
by
explanatory notes or comments,
still photographs or other
illustrations.
|
14.3
|
"Copies"
with reference to a musical composition or the lyrics thereof,
means
any copies, arrangements, orchestrations or versions thereof, whether
or
not in the form used in connection with the Motion Picture
involved.
|
14.4
|
"Motion
Picture" or its equivalent, means and includes a motion picture,
cinematograph film and/or photoplay of every kind and character
whatsoever, including the Sound Records thereof, as well as trailers
and
clips thereof, produced by means of any
photographic, electrical, electronic, mechanical or other processes
or
devices now or hereafter known, invented, used or contemplated, by
which
photographs, pictures, drawings, images or other visual reproductions
or
representations are or may be printed,
imprinted, recorded or otherwise preserved on film, tape or any other
material of any description (whether translucent or not) for later
projection or exhibition in such manner that the same are or appear
to be
in motion on a screen, mirror, tube or other medium or device, whether
or
not accompanied by Sound Records.
|
14.5
|
"Television
Motion Picture" means a Motion Picture produced hereunder based upon
the
Property initially exhibited on television, including without limitation:
(a) a pilot, or an episode of a television series (episodic or anthology),
it being understood that a "television series" includes the pilot
therefor, regardless of length and regardless of whether there is
any
binding commitment for any ensuing series of episodes from such pilot;
(b)
a so-called single or movie-of-the-week ("MOW"); or (c) a so-called
"Miniseries"
consisting of a Television Motion Picture which is a serialization
of the
plot or story based upon the Property, and is intended for exhibition
sequentially in two or more
segments.
|
14.6
|
"Theatrical
Motion Picture" means a Motion Picture produced hereunder based upon
the
Property which is initially exhibited as a general theatrical release
(ea, public or private screenings and/or previews and/or a limited
theatrical test run of one [1] week or less shall not constitute
a
theatrical release for purposes of this
Agreement).
|
14.7
|
"Person"
includes any association, organization, partnership, business trust,
corporation or governmental agency, as well as natural
persons.
|
14.8
|
"Remake"
means a Motion Picture utilizing the characters of the Property and
depicting the same plot or story as that portrayed in the initial
Motion
Picture, which plot or story does not continue the original story
or carry
it forward or backward in time.
|
14.9
|
"Sequel"
means a Motion Picture utilizing the principal character or characters
of
the Property, initial Motion Picture or any Sequel or Remake thereof
participating in entirely different events than those portrayed in
any
preceding Motion Picture(s), whether prior to, concurrent with or
subsequent to the events portrayed in any preceding Motion Picture(s)
and
whose plot is substantially new.
|
14.10
|
"Sound
Records" means and includes sound recordings and reproductions
of every kind and character whatsoever produced by means of any
electrical,
electronic, mechanical or other processes or devices now known or
hereafter known, invented, used or contemplated by which sound may
be
recorded for later transmission
or playback, whether or not simultaneously, or in synchronization
or times
relation, with Motion Pictures.
|
14.11
|
"Property"
means the aforementioned unpublished graphic novel written by Owner
currently entitled "UNIQUE" (formerly entitled "JAUNT") and the underlying
literary material upon which it is based, and includes its title
or title
and subtitles, and all themes,
stories, storylines, plots, characters and their names, artistic
renderings and all other elements and materials (written, drawn,
illustrated or otherwise), sequels, prequels
and spin-offs, and all prior, present and future versions, adaptations
and
translations
thereof (whether written by Owner or by others), its music, lyrics,
choreography,
sets, costumes, orchestrations, arrangements, if any, and wherever
throughout the world protectible thereby, its statutory and common
law
copyright or copyrights, all present or future renewals and extensions
of
such copyrights and all rights comprehended in such copyrights, and
each
and every part of all thereof.
|
(a)
|
unique
elements (etc ., plots, characters) existing only in "planted spin-off
graphic
novels or comic books (i.e., a graphic novel or comic book series
in which no central
character in the Property appears in a continuing role in the spin-off
graphic novel
or comic book); provided, however the unique elements of such planted
spin-off shall not be included in the Property only if (i) Owner
gives
notice to WDP in writing of any Property character's appearance in
the
planted spin-off; and (ii) no Property character
appears in more than three (3) issues of such planted spin-off if
released
as a comic book series (or the equivalent length of three [3] comic
books
[i.e., approximately 100 standard United States comic book pages]
if in
strip, graphic novel or other form [e.g„
if any planted spin-off is released as a graphic novel, any Property
character shall not appear in more than 100 pages of such graphic
novel]);
|
(b)
|
unique
elements (etc.., plots, characters) existing only in so-called "crossover"
graphic novels or comic books (i.e., an established graphic novel
or comic
book series featuring characters not originally part of the Property
and
in which a central character from the Property makes an appearance);
|
(c)
|
any
"Excluded Character" i.e., any established or preexisting character,
which
character has previously appeared in an unrelated established comic
book/gra.phic
novel or other media such that it did not originate in the Property)
which
visits
the Property; provided, however such Excluded Character(s) shall
not be
included in the Property only if: (i) Owner gives notice to WDP in
writing
of any Excluded Character(s)
appearance in the Property, provided that such notice shall not be
required
after three (3) years following the conclusion of the domestic theatrical
release of the Picture unless and until Owner is aware that WDP is
in
development in connection
with any other production hereunder based on the Property, provided,
further
that notwithstanding the foregoing, at any time, Owner agrees to
provide
WDP with a list of all Excluded Characters appearing in any issue(s)
of
the Property as requested
by WDP), (ii) such Excluded Character(s) do not appear in more than
three
(3)
issues of Property if released as a comic book series (or the equivalent
length of three
(3) comic books [i.e., approximately 100 standard United States comic
book
pages]
if in strip, graphic novel or other form [e.g, if the Property is
released
as a graphic
novel, any Excluded Character shall not appear in more than 100 pages
of
such graphic novel]) within a period of eighteen (18) months, and
(iii)
and no more than two (2)
different Excluded Characters appear in the Property in any eighteen
(18)
month period,
provided that solely for the purposes of this subparagraph (iii),
if an
Excluded Character appears in less than five (5) pages of an issue
of the
Property, such Excluded
Character's appearance shall not be counted as one of the two (2)
Excluded
Characters permitted to appear in the Property in any eighteen (18)
month
period;
|
(d)
|
any
"Planted Character(s)" i.e., any character[s] or group of characters
Leg,-, such as "X-Men" or alien world] which is created for the express
purpose of being spun-off
elsewhere in which such property the Planted Character[s] will be
the
central character[s]
in such property); provided, however such Planted Character(s) shall
not
be included in the Property only if: (i) Owner gives notice to WDP
in
writing prior to such Planted Character(s) appearance in the Property,
provided that such notice shall not be required after three (3) years
following the conclusion of the domestic theatrical release of the
Picture
unless and until Owner is aware that WDP is in development in connection
with any other production hereunder based on the Property, provided,
further
that notwithstanding the foregoing, at any time, Owner agrees to
provide
WDP with a list of all Planted Characters appearing in any issue(s)
of the
Property as requested
by WDP); (ii) such Planted Character(s) do not appear in more than
three
(3) issues of Property if released as a comic book series (or the
equivalent length of three (3)
comic books [i.e., approximately 100 standard United States comic
book
pages] if in strip, graphic novel or other form [e
g_, if the Property is released as a graphic novel, any Planted
Character shall not appear in more than 100 pages of such graphic
novel]),
(iii) no more than two (2) Planted Character(s) appear in the Property
in
eighteen (18) months, and (iv) the Planted Character(s) appear in
the
spin-off property no later than six (6) months after the Planted
Character(s) first appearance in the Property;
or
|
(e)
|
any
characters from any "planted spin-off" or "crossover" graphic novel
or
comic
book series or other non-comic media (e.g, a video game character)
solely
to the extent
such characters are featured in connection with the Property as part
of an
advertisement
for or excerpt from (e.g., a teaser story) such "planted spin-off"or
"crossover"
graphic novel or comic book series or other non-comic media attached
to
the
Property;
|
17.1
|
If
principal photography of the Picture has not commenced within seven
(7)
years from the date the Option is exercised (if ever) (the "Reversion
Date"), then upon
written notification to WDP and WDP's failure to commence principal
photography (as
such term is commonly understood in the motion picture industry)
of the
Picture within
ninety (90) days of WDP's receipt of such notice, the Rights granted
to
WDP by Owner
hereunder shall revert to Owner (excluding the rights to any screenplay(s)
or other
material written by or on behalf of WDP); provided, however, that
WDP may
delay the
Reversion Date for a three (3) year period if WDP so elects prior
to the
Reversion Date,
and if WDP so elects then Owner shall be entitled to receive the
sum of
$250,000 for
such three (3) year period, which sum shall be an advance against
the
production bonus
and shall accrue and become payable to Owner upon written notification
from an authorized
Business Affairs executive of WDP to Owner of WDP's decision to delay
the
Reversion
Date; provided, further, that the foregoing periods shall be extended
for
any period
during which a claim with respect to the Property has been asserted
and
remains unresolved,
and for any period during which WDP's development and/or production
activities
based upon the Property are interrupted or postponed due to any occurrence
of
an event of force majeure, including without limitation, any labor
strike,
threatened labor
strike, or other labor dispute.
|
17.2
|
At
such time, if ever, that the Rights revert to Owner pursuant to
Paragraph
17.1 above, WDP shall be provided with a first-priority security
interest/lien (including, but not limited to, a copyright mortgage
and
UCC-1 s for the State of California,
State of New York, and New York County) ("Lien") for the applicable
costs
in connection with the Property and the Picture as set forth in Paragraphs
17.3.a. or17.3.b. below, plus accrued interest thereon from the time
an
item of cost was paid, incurred
or charged, at an annual rate (the "Interest Rate") equal to 125%
of the
U.S. prime
rate as published by the Bank of America, as such rate may vary from
time
to time.
Such costs plus interest shall be paid to WDP no later than the time
the
Picture is set up for development as a theatrical, direct-to-video,
television Motion Picture or other production by a third party. In
addition, in the event of a reversion, the Rights shall revert
to Owner subject to the assumption by such third party of all of
WDP's
obligations
in connection with the
Picture.
|
a.
|
convey
to Owner all rights in and to the WDP Materials, in which case, WDP
shall
be entitled to reimbursement of, and have a Lien against the Property
and
the WDP Materials for, an amount equal to all amounts paid, and all
costs
incurred, by WDP in connection with the Picture (the "WDP Costs"),
plus
accrued interest thereon from the time an item of cost was paid,
incurred
or charged, at the Interest Rate;
or
|
b.
|
retain
all rights in and to the WDP Materials, in which case,
Owner shall
acquire no rights in or to the WDP Materials, and WDP shall be entitled
to
reimbursement
of, and have a Lien against the Property for, the amounts paid by
WDP
to Lender pursuant to Paragraphs 2.3 and 2.6 above, plus accrued
interest
thereon
from the time an item of cost was paid, incurred or charged, at the
Interest
Rate.
|
17.4
|
Notwithstanding
anything to the contrary set forth in Paragraphs 17.1, 17.2
and 17.3 above, in the event the Rights revert to Owner pursuant
to
Paragraph 17.1
above, Owner shall not have any right to:(a) use (or to authorize
third
parties to use) WDP's name or the name of WDP's parent, subsidiaries
of
its parent, affiliates, successors
and assigns (and any trademarks, copyrights, service marks, or logos
of
the foregoing); or (b) promote, publicize, market, advertise, or
otherwise
exploit any of the Rights or any of the rights in the WDP Materials
(if
any) obtained by Owner in such a manner as to tie or connect such
rights
with WDP or WDP's parent, subsidiaries of its parent, affiliates,
successors and assigns.
|
To Owner: | William Morris Agency | |
151 El Camino Drive | ||
Beverly Hills, CA 90212 | ||
Attn: Alan Gasmer | ||
With a courtesy | Wyman & Isaacs, LLP | |
8840 Wilshire Boulevard, 2nd Floor | ||
Beverly Hills, CA 90211 | ||
Attn: Bob Wyman | ||
To WDP: | WALT DISNEY PICTURES | |
500 South Buena Vista Street | ||
Burbank, CA 91521-0804 | ||
Attn:
Senior Vice President
Legal
Affairs
|
Walt Disney Pictures | |||
|
By:
|
/s/ Douglas A. Carter | |
DOUGLAS A. CARTER | |||
Its: | SR. VICE PRESIDENT | ||
BUSINESS AFFAIRS |
|
By:
|
/s/ Scott Rosenberg | |
Scott Rosenberg |
(Seal) | ||||
/s/Rita
McCormack
|
RITA
MC
CORMACK
|
|||
Notary
Signature
|
Commission
#
1460275
|
|||
|
Notary
Public
- California
|
|||
Los Angeles County | ||||
My Comm. Expires Jan 5, 2008 |
(Seal) | ||||
/s/Rita
McCormack
|
RITA MC CORMACK | |||
Notary
Signature
|
Commission
# 1460275
|
|||
|
Notary
Public
- California
|
|||
Los Angeles County | ||||
My Comm. Expires Jan 5, 2008 |
Date: | July 1, 2003 |
Term: | 5 years |
Territory: | World Wide |
Licensed Articles: |
(a)
Paper based collectibles such as Lithographs, Posters, Poster Calendars,
trading cards; (b) Resin materials including, but not limited to,
statues,
busts, dioramas, snow globes; and (c) Plastic figures
including action figures, de-formed
mini-figures.
|
Marketing Dates: | Beginning March 2005 |
Morrigan Press | |
Date: | August 2003 |
Term: | 5 years |
Term: | 5 years |
Territory: | World Wide |
Licensed
Articles:
|
(a)
Paper based collectibles such as Lithographs, Posters, Poster Calendars,
trading cards; (b) Resin materials including, but not limited to,
statues,
busts, dioramas, snow globes; (c) Plastic figures including action
figures, de-formed mini-figures; and (d) Any other form of comic-based
collectibles that are typically sold to comic book and science
fiction
fans online and in hobby
stores.
|
A.
|
"Defined
Receipts" means the aggregate of all receipts actually received by
WDP on
behalf of the Picture in U.S. dollars in the U.S. or in a foreign
currency
which are not Restricted Funds, only
from:
|
1.
|
WDP's
direct distribution of the Picture in
theatres and on television ("TV"), including theatrical
and non-theatrical exhibitions, and free, cable
and pay TV exhibitions.
|
2.
|
Distribution
of the Picture by any Person
other than WDP licensed by WDP with an
obligation to report receipts and expenses to WDP
(a "Subdistributor"). WDP shall, to the extent
reported and accounted to WDP, treat all such
receipts received and earned by the Subdistributor,
and all distribution costs incurred by
the Subdistributor as though such receipts were
received and earned by WDP and such distribution
costs were incurred by WDP; and the licensing
or other arrangement between WDP and
each Subdistributor shall not be taken into account
in WDP's accounting to Artist under this
Exhibit DRCB.
|
3.
|
Manufacture
and distribution of audio-visual
cassettes, video discs and all electronic, digital
and/or optical storage and/or transmission formats,
any analog or digital reproductions, or any
similar device and/or format embodying the complete
Picture in linear form, whether now known
or hereafter devised ("Video Devices"); provided
that Defined Receipts for Video Devices shall
be: (a) if WDP distributes Video Devices, a royalty
in an amount equal to 20% of the sums actually
received by such entity (less taxes, credits
and returns) from its distribution thereof; or
(b) royalties actually received by WDP from any
unaffiliated third party Video Device distributor
less royalties payable to other third parties.
|
4.
|
"Flat
Sale" licenses for the theatrical exhibition
of the Picture for a specified period for any
territory or area (excluding the U.S. and Canada)
in consideration of the payment of a specified
amount not calculated by a percentage of
receipts of the applicable licensee.
|
6.
|
Receipts
from theater box office operated
by WDP in connection with four-wall or road
show exhibitions of the Picture to the extent receipts
from all such exhibitions taken as a whole
exceed costs incurred for all such exhibitions.
|
7.
|
Cash
subsidies granted by governmental
agencies or prizes to the extent granted
solely with respect to the Picture.
|
8.
|
The royalties
as provided in Schedules
A (Music) and B (Soundtrack Records,
Merchandising/Publishing), which are attached hereto and incorporated
herein by this reference.
|
1.
|
Box
office or other amounts retained by
any theater or other exhibition venue (except as
specified in Paragraph 1.1.A.6 hereof) for their own
account; and receipts of: roadcasters and other
transmitters by all means now known or hereafter
devised; wholesale or retail distributors, licensors
or sellers of Video Devices, audio devices
and other products; book or music publishers;
merchandisers and retailers; or any other
similar Person, whether or not any or all such
excluded Persons are owned, operated or controlled
by WDP, Affiliates or Related Parties.
|
2.
|
Amounts
received from advance payments
or security deposits unless earned by exhibition or broadcast, or
(subject
to Paragraph 1.1.A.2)
unconditionally non-returnable, and refunds,
rebates or adjustments granted to other Persons by WDP.
|
3.
|
Amounts
payable in foreign currency and not received by WDP in the U.S. due
to
remittance
restrictions ("Restricted Funds"). Restricted
Funds shall not be included in Defined Receipts
nor accounted for unless and until they have
been received by WDP in U.S. dollars in the
U.S. or expended by WDP in the territory in which
held, except as provided in 1.1.B.3(a) below.
|
(a)
|
If any
Defined Receipts Contingent
Bonus becomes payable to Artist
under this Agreement, Artist may notify
WDP in writing that Artist desires to have
included in Artist's Defined Receipts Contingent
Bonus, Artist's share of Restricted
Funds in a particular territory and designate
a bank or other representative in such
country, to whom payment may be made
for Artist's account. Upon WDP's receipt
of such notice and all required permissions,
such payment shall be made to Artist's
representative at Artist's expense.
Upon payment of Artist's share of
Restricted Funds, WDP shall have no further
obligation to account for such Restricted
Funds whether as Defined Receipts
or otherwise.
|
(b)
|
On
Artist's written request, WDP
shall report to Artist the amount of Restricted
Funds (if any) which under this Paragraph
1.1.B.3 have not yet been included
in Defined Receipts as of the closing
date of the most recent statement which
has been furnished to Artist under Paragraph
2.1 below.
|
4.
|
Amounts
collected in connection with the
distribution of the Picture as taxes or for payment
of taxes (e.g., admission, sales, use or value
added taxes, etc.).
|
6.
|
Receipts
from remakes, prequels, sequels,
radio or TV series or other derivative uses
of the Picture or any element thereof.
|
7.
|
Salvage
value or receipts derived from print
stocks, film or tape clips, stock footage, stills,
props, sets, wardrobe, or other items included
in Cost of Production except and only any
sums received from the sale of cars purchased
specifically in connection with the Picture
and sold within six months after completion
of photography, which sums shall be included
in the Defined Receipts of the
Picture.
|
C.
|
Defined
Receipts Deductions "Defined Receipts Deductions" means the aggregate
of all the
following costs, expenses and charges paid, advanced or
incurred by WDP or a Subdistributor, on a continuing basis,
directly or indirectly, in connection with the distribution,
exhibition and exploitation of the Picture:
|
1.
|
U.S.
is the United States, together with
any other countries licensed by or through the
distributing organization(s) servicing the U.S. for
WDP.
|
2.
|
Canada
is Canada, together with any other
countries licensed by or through the distributing
organization(s) servicing Canada for WDP.
|
3.
|
The
United Kingdom (U.K.) is United Kingdom
of Great Britain and Northern Ireland, Republic
of Ireland, Channel Islands, Isle of Man, Gibraltar,
Malta.
|
5.
|
All
foregoing references to countries include
their territories and possessions, and olitical
subdivisions.
|
6.
|
Distribution
to armed forces shall be included
in the particular territories where such exhibitions
shall occur. Distribution to airlines, ships
and other means of transportation shall be included
in the territory of their respective national
origin.
|
A.
|
Either
(i) WDP and Artist shall mutually select
an arbitrator, or (ii) if they cannot agree on such arbitrator,
WDP and Artist shall each select one arbitrator
and those two arbitrators shall then select a third arbitrator.
|
B.
|
The
parties shall arbitrate the dispute in accordance
with the then-prevailing Commercial Arbitration
Rules of the American Arbitration Association (except
to the extent expressly set forth elsewhere in this Exhibit
DRCB) and judgment on the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction
thereof.
|
A.
|
As
between WDP and Artist, WDP shall have
exclusive and perpetual control of the distribution, marketing,
advertising, publicizing, exploitation, sale or other
disposition of the Picture and may distribute, or withhold
or withdraw the Picture from distribution at its sole
discretion with respect to one or more territories or media.
WDP may distribute the Picture with other pictures whether
or not WDP has any interest in such other pictures.
|
B.
|
For
all purposes under this Exhibit DRCB, allocations
of Defined Receipts, costs, rights and other matters
relating to the Picture and other motion pictures shall
be allocated by WDP in its business judgment and in accordance
with WDP's prevailing business
practice.
|
C.
|
With
respect to trailers and shorts exhibited with
the Picture outside of the U.S. and Canada, Defined Receipts
shall be reduced by 3% for trailers and 5% for shorts.
|
D.
|
As
between WDP and Artist, WDP owns all rights to the Picture and its
Defined
Receipts and Contingent Proceeds, including the right to encumber,
transfer or dispose of them and Artist shall have no right, title
or
interest therein. Artist acknowledges that its sole right under this
Exhibit is a contractual right to contingent compensation in the
form of,
and measured by, the
|
E.
|
WDP,
its agents and assigns, in its and their business
judgment, shall be entitled to distribute the Picture
on a percentage basis or make flat sales, make and
cancel contracts, adjust and settle disputes, and give allowances
and rebates to distributors, licensees, exhibitors
or other Persons whether or not any such entity is
owned, operated or controlled by WDP, Affiliates or Related
Parties.
|
F.
|
WDP
shall have complete discretion in determining
the extent, if any, to which it will audit or check payments or charges
to
WDP or assert claims with respect thereto.
|
G.
|
Artist
acknowledges that WDP is part of a large,
diversified international group of affiliated companies
engaged in a variety of business activities. WDP has informed Artist
that
it frequently enters into business transactions with Affiliates and
Related Parties, and Artist acknowledges and agrees that WDP is
entitled
(but is not obligated) to, and may, in its sole discretion,
enter into agreements or other arrangements with
Affiliates and Related Parties in connection with any or
all rights relating to the Picture, including, without limitation,
all exploitation rights and all subsidiary, ancillary or
other rights relating thereto (the "Exploitation Rights"). Artist
hereby acknowledges and agrees that WDP is under
no obligation, express or implied, to offer the Exploitation
Rights or any part thereof to unaffiliated or unrelated
third parties, whether in lieu of or in addition to offering
such rights to Affiliates and Related Parties, or to otherwise
seek or secure any business arrangements with any
unaffiliated or unrelated third parties with respect thereto.
Without limiting the generality of any other provision
of the Agreement, Artist hereby waives any right to make any claim
or seek
any relief, whether at law or in equity (specifically including injunctive
relief), asserting
the existence and/or breach of any such express or implied obligation.
|
A.
|
If
after completion and delivery of the Picture to WDP, WDP sells all
its
right, title and interest in the Picture (other than to an Affiliate
or
through merger or consolidation),
Artist may elect that:
|
1.
|
The
net sum received by WDP shall constitute
Defined Receipts hereunder but further income
of purchaser in connection with the Picture
shall not be included in Defined Receipts, or,
|
2.
|
The
net sum received by WDP shall not
be included in Defined Receipts and all receipts
and expenses (other than the purchase price
paid to WDP) of the purchaser relating to the
Picture shall be treated for purposes of accounting
to Artist, as though they were receipts
and expenses of WDP, provided that upon
assumption by purchaser of such obligation,
the sale shall be considered a novation
and WDP shall thereafter have no obligation
of any kind to Artist.
|
B.
|
Artist's
election shall be made within 7 days after WDP notifies Artist in
writing
that it proposes to
make such sale and identifies the purchaser and purchase
price. If WDP does not receive written notice of Artist's election
within
7 days after issuance of WDP's notice,
then WDP shall have the right, but not the obligation,
to make such election on Artist's
behalf.
|
A.
|
Artist
may assign Artist's right to receive its
Defined Receipts Contingent Bonus hereunder in whole or
in part, at any time after the release of the Picture, subject
to WDP's approval not to be unreasonably withheld
and provided that such assignment does not subject
WDP to any additional liability in connection with the
assignment. However, in no event shall WDP be obligated
to account to more than one Person. In any event,
WDP's obligation to pay in accordance with any assignment,
or designation of a disbursing agent, shall be conditioned
on WDP's receipt of written notice thereof, in form
satisfactory to WDP, and WDP's payment in accordance
therewith shall satisfy WDP's payment obligations
to Artist hereunder. Artist's right to examine
WDP's books of account shall not be assignable without WDP's prior
written
consent and in any event shall be limited to one Person.
|
B.
|
WDP
shall have the right of first refusal with respect to any proposed
assignment of Artist's right to receive Defined Receipts Contingent
Bonus
hereunder upon
equivalent terms (to the extent economically matchable)
offered to Artist by a bona fide third party. Artist
shall notify WDP of the terms of any such proposed
assignment and WDP shall have 7 business days
within which to elect to accept such terms. Artist shall
make no change in such terms which are adverse to Artist's
interest without giving WDP the opportunity to accept
such changed terms. If WDP does not elect to accept
such terms, then Artist shall be free to accept the proposed
terms of assignment from such bona fide third party
provided that if such proposed assignment is not concluded
within 30 days following the expiration of the 7 business
day period referred to above, WDP's right of first refusal
under this Paragraph 3.5.B shall revive and shall apply
to each subsequent offer received by Artist. This Paragraph
3.5.B shall not apply to family
gifts.
|
A.
|
This
Agreement is not for the benefit of any third party and shall not
create a
partnership, joint venture, agency, trust or fiduciary obligation
between
WDP and Artist or make Artist WDP's agent or create a relationship
between
WDP and Artist other than creditordebtor to the extent amounts are
due
hereunder.
|
B.
|
WDP
may, in its business judgment, commingle
Contingent Proceeds or Defined Receipts with any
other funds.
|
C.
|
Nothing
in this Exhibit DRCB or the Agreement
shall give Artist the right to a lien on the Picture,
the Contingent Proceeds or Defined Receipts.
|
D.
|
Artist
shall not be entitled to interest or any other gain which may accrue
as a
result of WDP's obligation to pay Artist's Defined Receipts Contingent
Bonus (or part thereof) even in the event of a dispute between Artist
and
WDP concerning the interpretation of this Exhibit DRCB, non-payment
hereunder or otherwise.
|
E.
|
Headings
are for convenience only and are of
no effect in construing the contents of this
Agreement.
|
F.
|
Artist
waives any right at law or equity to revoke, terminate, diminish
or enjoin
any rights granted or acquired by WDP hereunder by reason of a claimed
nonpayment of monies allegedly due and payable hereunder, it being
agreed
that Artist's sole remedy for any such alleged non-payment shall
be
limited to a claim for any such money that is due and payable
hereunder.
|
1.
|
A
royalty equal to fifteen percent (15%) of Music Publishing Contingent
Proceeds ("MPCP") received by WDP
from the exploitation of music publishing rights (i.e., mechanical
reproduction, public performance, sheet
music/folios and synchronization) to the original music and/or lyrics
written specifically for and synchronized
in the Picture as generally released (the "Music") shall be included
in
Defined Receipts.
|
2.
|
Music
Publishing Defined Receipts ("MPDR") shall mean all monies actually
received by WDP with respect to
the Music excluding any advance, guarantee or minimum royalty payment
received by WDP in connection with
any subpublishing, collection, licensing or other agreement, unless
such
payment is specifically attributable
to the Music.
|
(b)
|
All
additional shares of MPDR payable by WDP to such composer(s), lyricist(s)
and/or any other third
party co-publishers, administrators or other
participants.
|
(c)
|
Collection
or other fees customarily and actually charged by The Harry Fox Agency,
Inc., or any other
collection agent used by WDP.
|
(e)
|
All
other administration and exploitation expenses incurred with respect
to
the Music including, without
limitation, the costs of producing demonstration records,
advertising and promotion expenses,
costs or amounts payable to third-party publishers, co-publishers,
administrators, publishing
participants, subpublishers, licensees, trustees or collection
agents, attorneys' and accountants'
fees directly related to the Music, and damages and expenses incurred
by
reason of
infringement claims, but excluding rents, overhead, salaries and
other
similar general expenses.
|
4.
|
If
Artist is entitled to receive a direct royalty or other type of payment
with respect to the Music, then no portion
of MPCP will be included in Defined
Receipts.
|
1.
|
SOUNDTRACK
RECORDS: In the event WDP receives any royalties in respect of the
soundtrack album(s)
("Album") and/or other "phonorecords" (as that term is defined in
the U.S.
Copyright Act of 1976, 17 U.S.C.
Sections 101, et. seq.) derived from the soundtrack of the Picture
("Soundtrack Records"), then WDP agrees that such royalties will
be
computed as follows for inclusion in Defined
Receipts:
|
1.1
|
If
an Affiliate distributes Soundtrack Records, then the royalty included
in
Defined Receipts shall equal
2% % ("Royalty Rate") of the suggested retail list price (or the
equivalent wholesale royalty) for net sales of the
Album through normal retail channels in the United States ("USNRC
Sales").
The Royalty Rate shall be otherwise
defined, computed, reduced and accounted for on the same basis that
the
Affiliate customarily accounts
to third party recipients including, without limitation, in respect
of
foreign sales, configurations variations,
taxes, flat fee licensing, coupling, singles, free goods, packaging
deductions, royalty base and all other
reductions and deductions. Royalties hereunder shall only be included
in
Defined Receipts prospectively after
the recoupment from the aggregate royalty payable (or accrued against
advances or other charges) by WDP
in respect of Soundtrack Records (including royalties payable to
artists,
producers, record companies, film personnel,
music supervisors, musicians and the royalty payable pursuant to
this
Schedule B) of the following: (i)
all recording costs of the master recordings embodied in Soundtrack
Records; (ii) any re-recording costs of master
recordings which are re-recorded for Soundtrack Records; and (iii)
all
costs of converting the master recordings
in the Picture from motion picture recordings to phonograph record
use
(including, re-recording costs, reuse
fees, editing, sweetening, etc.).
|
1.2
|
In
the event that WDP receives its royalties from the exploitation of
Soundtrack Records by a third party distributor, then the royalty
to be
included in Defined Receipts shall be the "Soundtrack Contingent
Proceeds"
(as defined below).
|
1.3.
|
"Soundtrack
Contingent Proceeds" shall mean all revenues received by WDP from
the
exploitation of Soundtrack Records, if any, as set forth in the applicable
Soundtrack Records agreement after deduction of the following costs
and
third party royalties:
|
(a)
|
A
sum equivalent to the actual dollar amount (including any fixed cash
amounts, advances
and/or royalties) actually paid to all third party performers and/or
participants with respect to the music/soundtrack contained in Soundtrack
Records and/or the Picture, including without limitation, cash payments
and/or royalties payable to artists, producers, record companies,
film
personnel, music supervisors and
musicians.
|
(b)
|
A
sum equivalent to all artwork costs for Soundtrack Records to the
extent
such artwork costs
are paid by or charged to WDP, remixing and remastering costs,
re-recording costs, reuse fees, license fees
and similar costs attributable to the recording/production and/or
licensing of the master recordings embodied
on Soundtrack Records, except to the extent such costs are included
in the
negative cost of the Picture
and to the extent such Soundtrack Records costs and fees have actually
been incurred directly or indirectly
by WDP.
|
(c)
|
Any
legal fees or related expenses incurred by WDP for outside legal
counsel
engaged at WDP's election to: document and/or negotiate the applicable
Soundtrack Records agreement; in protecting or defending WDP's rights,
privileges and benefits with respect to Soundtrack Records and/or
any
master recordings recorded/acquired for the Picture and/or Soundtrack
Records; and/or in connection with any dispute involving any
release/distribution agreement pertaining to Soundtrack
Records.
|
(d)
|
In
the event the Soundtrack Records distributor pays WDP any nonreturnable
advance against royalties, a reasonable reserve shall be applied
towards
(i) third party payments payable prior to the Soundtrack Record
distributor's recoupment of such advance at the "net" artist rate;
and
(ii) unrecouped costsincurred
by WDP in respect of any Soundtrack Records and/or in excess of the
budgeted cost of the music for the
Picture.
|
1.4.
|
Notwithstanding
the foregoing, no royalties shall be included hereunder for any so-called
"storyteller" or "read-along" phonorecords or for any phonorecords
embodied in other merchandise or for any audiovisual devices now
known or
hereafter devised.
|
1.5.
|
If
Artist is entitled to receive a direct royalty or other type of payment
with respect to Soundtrack Records, then no royalties from Soundtrack
Records will be included in Defined
Receipts.
|
2.
|
MERCHANDISING/PUBLISHING.
With respect to items of merchandising (including interactive games
and
other products and services) and book publication (including children's
storytelling recordings, as distinguished
from soundtrack records, but excluding souvenir programs and similar
publications) based on the Picture,
then:
|
2.1
|
For
items sold by a licensee of WDP, the royalties WDP receives from
such
licensee shall be included in Defined Receipts of the Picture after
first
deducting (i) a percentage deduction of: fifty percent (50%), inclusive
of
subdistributor fees, for items sold in the U.S.; sixty-five percent
(65%),
inclusive of subdistributor fees, for items sold outside the U.S.;
and
fifteen percent (15%) plus any subdistributor's fees for any book
novel;
and (ii) out-of-pocket costs and royalties to third parties;
or
|
2.2
|
For
items are sold by WDP at the wholesale or retail level, at WDP's
discretion, either:(i) an amount equal to seven (7%) of the wholesale
price of such items sold by WDP at the wholesale level (less a reasonable
allowance for returns); or (ii) an amount equal to seven percent
(7%) of
fifty percent (50%) of the gross retail revenues of such items sold
by WDP
at the retail level (less a reasonable allowance for returns) shall
be
included in Defined Receipts of the Picture after first deducting
(a) a
percentage deduction of fifty percent (50%) for items sold in the
U.S.;
sixty-five percent (65%) for items sold outside the U.S.; and fifteen
percent (15%) with respect to any book novel; and (b) out-of pocket
costs
and royalties to third parties.
|
2.3
|
In
no event shall any items of merchandise be treated as falling under
both
provisions 2.1 or 2.2 above.
|
2.4
|
If
Artist is entitled to receive a direct royalty or other type of payment
with respect to the exercise
of merchandising and book publication rights, then no royalties therefrom
will be included in Defined Receipts.
|
1.
|
With
respect to Paragraph 1.1.A.2. (DEFINITIONS, DEFINED RECEIPTS),
Subdistributors
hereunder shall be deemed to include WDP sales agents (if
any).
|
2.
|
With
respect to Paragraph 1.1.A.5. (DEFINITIONS, DEFINED RECEIPTS), the
words
"excluding costs of WDP in-house counsel in connection with such
copyright
infringement
claims" shall be inserted immediately after the word "costs" but
within
the parenthetical;
and the words "unfair competition, trademark, and/or patent infringement
and/or defamation claims" shall be inserted immediately after the
word
"infringers."
|
3.
|
With
respect to Paragraph 1.1.A.8. (DEFINITIONS, DEFINED RECEIPTS), the
words
"and other receipts" shall be inserted immediately after the word
"royalties" in the first line.
|
4.
|
With
respect to Paragraph 1.1 .A. (DEFINITIONS, DEFINED RECEIPTS), the
following are added as new Paragraphs 9. and 10. thereof: "9. Receipts
from the distribution of trailers for the Picture; and 10. Receipts
allocable to the Picture as received from the Copyright Tribunal,
payable
pursuant to Section III of the 1976 U.S. Copyright Act. There will
be no
Percentage
Deduction applied to the receipts under this subparagraph
10."
|
5.
|
With
respect to Paragraph 1.1.B.3. (DEFINITIONS, DEFINED RECEIPTS XCLUSIONS),
after the word "WDP" in the seventh line, the words "for any purpose"
shall be inserted; and the following shall be added at the end of
the
Paragraph, "or unless freely remittable to the U.S. in U.S. dollars.
There
shall be no unreasonable delay with respect to the conversion and
remittance of foreign receipts
hereunder."
|
6.
|
With
respect to Paragraph 1.1.B.5. (DEFINITIONS, DEFINED RECEIPTS EXCLUSIONS),
the words "any charitable screening" shall be inserted immediately
after
the word "from" in the first line.
|
7.
|
With
respect to Paragraph 1.1.B.7. (DEFINITIONS, DEFINED RECEIPTS EXCLUSIONS),
the words "or such other major items" shall be inserted immediately
after
the word "cars" in the fifth line.
|
8.
|
With
respect to Paragraph 1.1.C.3. (DEFINITIONS, DEFINED RECEIPTS EDUCTIONS,
CHECKING), the following shall be added thereto: "provided such checking
costs shall not exceed one percent (1%) of the worldwide Defined
Receipts
of the Picture."
|
9.
|
With
respect to Paragraph 1.1.C.4. (DEFINITIONS, DEFINED RECEIPTS DEDUCTIONS,
COLLECTIONS), the word "outside" shall be inserted immediately after
the
word "including" in the first line and also immediately after the
word
"and" in the second line.
|
10.
|
With
respect to Paragraph 1.1.1.C.6. (DEFINITIONS, DEFINED RECEIPTS DEDUCTIONS,
TRADE DUES), the following sentence is added to the end of this paragraph:
"Notwithstanding the foregoing, Defined Receipts shall not be reduced
by
more than: (1) $250,000
in the aggregate for domestic trade association fees payable by WDP
to the
M.P.A.A., A.M.P.T.P.
and/or any similarly constituted or substitute person or successor
organization to which WDP may now or hereafter belong on account
of
receipts or proceeds from the distribution
of the Picture; and (2) $250,000 in the aggregate for foreign trade
association fees payable
by WDP to the M.P.E.A. and/or any successor organization to which
WDP may
now or hereafter belong on account of receipts or proceeds from the
distribution of the Picture."
|
11.
|
With
respect to Paragraph 1.1.C.8. (DEFINITIONS, DEFINED RECEIPTS DEDUCTIONS,
TAXES), (a) the words "(appropriately allocated)" shall be inserted
immediately after the word "nature" in the first line; and (b) the
following shall be added as the last sentences thereof:
"In the event of any tax refunds and/or in the event of any interest
adjustment, Distribution
Costs shall be credited (without any Percentage Deduction taken)
with
respect thereto.
The words 'corporate income taxes' appearing herein shall mean taxes
based
on net income,
so-called excess profits, and to the extent such are in the nature
of
taxes based on net income
or so-called excess profit taxes -- franchise and corporation income
taxes. Also to the extent
any such taxes paid by WDP are deducted and subsequently refunded,
an
appropriate retroactive
adjustment shall be made."
|
12.
|
With
respect to Paragraph 1.2.F.1. (DEFINITIONS, MISCELLANEOUS DEFINITIONS, TERRITORY),
the
following words shall be added thereto: "and all transportation
companies, armed services or institutions flying the flag of the
U.S."
|
13.
|
With
respect to Paragraph 1.2.F.6. (DEFINITIONS, MISCELLANEOUS DEFINITIONS,
TERRITORY), the words "such exhibitions shall occur" in the second
and
third lines shall be deleted and the words "agreements relating to
such
exhibition are entered into" shall be inserted in place
thereof.
|
14.
|
With
respect to Paragraph 2.1. (ACCOUNTING, STATEMENTS), (a) solely in
the
event Owner is receiving Defined Receipts Contingent Bonus payments
hereunder within the first two years, then (i) the word "three" shall
replace the word "two" in the third line; (ii) the word
"year" shall be inserted immediately after the word "next" in the
seventh
line; (iii) the words
"two years" shall be deleted therefrom; and (b) "$500,000" shall
be
changed to "$750,000" in the seventeenth
line.
|
15.
|
With
respect to Paragraph 2.1. (ACCOUNTING, STATEMENTS), the following
is
added immediately before the last sentence thereof: "but the foregoing
shall not limit Owner's right
to request a statement as provided in the first sentence of this
paragraph
2.1." And the following
is added to the last sentence thereof: "and if the Picture is broadcast
on
prime time network
television in the U.S. or exhibited on a premium pay TV service or
The
Disney Channel or
similar pay cable stations in the first free TV window, in the U.S.,
WDP
shall account therefor by
issuing a quarterly statement for one year starting on the accounting
period within which the Picture
has been so exhibited, accompanied by payment of the amount, if any,
shown
thereby to be
due Owner."
|
16.
|
With
respect to Paragraph 2.2. (ACCOUNTING, INCONTESTABILITY), the number
"36"
shall be substituted for the numeral "24" in each place therein;
the word
"issued" shall be deleted from the fifth line thereof and the word
"received" substituted therefor; and the numeral "12" shall be substituted
for the numeral "6" in the tenth line
thereof
|
17.
|
With
respect to Paragraph 2.2. (ACCOUNTING, INCONTESTABILITY), the following
shall be inserted immediately after the word "objection" in the eleventh
line: "or if commenced in 6 months after completion of audit, if
such
audit is commenced prior to, but completed on a timely basis after
said
36-month period."
|
18.
|
With
respect to Paragraph 2.2. (ACCOUNTING, INCONTESTABILITY) the following
sentence shall be inserted immediately after the sentence ending
with the
word "first" in
the thirteenth line: "The foregoing period within which Owner may
raise
objections shall recommence,
but only with respect to certain transactions or items included in
previous statements that have been thereafter revised and/or
corrected."
|
19.
|
With
respect to Paragraph 2.3. (ACCOUNTING, BOOKS), the word "national"
is
deleted
from the seventh line.
|
20.
|
With
respect to Paragraph 2.3. (ACCOUNTING, BOOKS), the word "issuance"
is
deleted from the fifth line and the word "delivery" is substituted
therefor, and the following sentence
shall be inserted immediately after the word "withheld" in the ninth
line:
"The 'big five' accounting firms excluding Price Waterhouse Coopers
are
pre-approved by WDP subject to any conflict of interest that may
exist or
arise. Laventhol & Horwath or any successor-in-interest or any of its
present or former principals or employees shall be deemed not approved
by
WDP so long
as they are representing Silver Screen Partners as auditors and/or
if they
previously represented
Silver Screen as auditors on any WDP picture. In addition, any auditor(s)
that represents
Touchwood Pacific Partners I and/or Interscope Communications Inc./Nomura,
Babcock
and Brown Unit One Film Partners and/or any other financier of the
Picture
and/or any other WDP picture shall be deemed not approved by
WDP."
|
21.
|
With
respect to Paragraph 2.4. (ACCOUNTING, WITHHOLDINGS), the following
shall be added at the end thereof: "Any moneys so recovered by Owner
resulting from such claims or prosecutions shall be retained by Owner
unless WDP has a prior existing claim or lien, provided however that
nothing herein shall be deemed a waiver of either party's rights
or
remedies in law or equity.
|
22.
|
With
respect to Paragraph 2.6. (ACCOUNTING, RESERVES), the following shall
be
added thereto: "In any event, WDP shall liquidate any such reserves
within
12 months after establishing the same unless there is any claim and/or
litigation pending, in which case WDP may continue to maintain such
reserves".
|
23.
|
With
respect to Paragraph 3.3.A. (MISCELLANEOUS, CONTROL OF EXPLOITATIONAND
MARKETING) the following shall be added after the word "Owner" in
the
first line: "subject to Owner's consultation rights, if any, in connection
therewith as more fully set forth in this
Agreement,"
|
24.
|
With
respect to Paragraph 3.3.A. (MISCELLANEOUS, CONTROL OF EXPLOITATION
AND MARKETING), the following shall be added following the last sentence
thereof: "subject to, and except as provided to the contrary in the
Agreement to which this Rider is attached. Notwithstanding the foregoing,
there shall be no sub-distribution of the Picture in the U.S.
or Canada unless WDP customarily uses sub-distributors for distribution
in
the U.S. and/or Canada and at that time with respect to substantially
all
other motion pictures during the same calendar
year."
|
25.
|
With
respect to Paragraph 3.3.B. (ADDITIONAL TERMS, CONTROL OF EXPLOITATION
AND MARKETING), the words "good faith" shall be inserted immediately
after
the word "business" in the fourth
line.
|
26.
|
With
respect to Paragraph 3.3.C. (ADDITIONAL TERMS, CONTROL OF EXPLOITATION
AND MARKETING), the words "trailers and" are deleted from the first
line,
and the words "for trailers and 5% " are deleted from the third line
thereof.
|
27.
|
With
respect to Paragraph 3.4.A.1. (ADDITIONAL TERMS, SALES OF ALL RIGHTS),
the word "sum" in the first line shall be changed to
"sum(s)."
|
28.
|
With
respect to Paragraph 3.4.A.2. (ADDITIONAL TERMS, SALES OF ALL RIGHTS),
the following shall be inserted immediately after the word "assumption"
in
the eighth line: "in writing and subject to full
performance."
|
29.
|
With
respect to Paragraph 3.4.B. (ADDITIONAL TERMS, SALES OF ALL RIGHTS),
the
words "14 business days" shall be substituted for the words "7 days"
in
the each place therein. In addition, the words "and other material
terms"
shall be inserted immediately after the word "price" in the fourth
line.
|
30.
|
With
respect to Paragraph 3.5.A (MISCELLANEOUS, ASSIGNMENT BY OWNER),
the words "completion of services" shall be inserted immediately
after the
word "after"
in the third line; and the words "the release of the Picture" in
the third
line shall be deleted.
|
31.
|
With
respect to Paragraph 3.5.A. (ADDITIONAL TERMS, ASSIGNMENT BY OWNER),
the
following shall be added after the word "Picture" in the third line:
"or
to Artist's loan-out company or other closely held corporation and
vice-versa; provided that, and subject to, all parties signing WDP's
customary (i) Notice of Irrevocable Authority and (ii) Acknowledgment
of Notice of Irrevocable
Authority."
|
32.
|
With
respect to Paragraph 3.5.B. (ADDITIONAL TERMS, ASSIGNMENT BY OWNER),
the
word "material" shall be inserted before the word "change" in the
eighth
line thereof,
and the following words shall be added to the last sentence thereof:
"or a
transfer to any corporation or entity wholly owned or controlled
by
Owner."
|
A.
|
FIRST
DEDUCTION - First, an amount equal to the following percentages
("Percentage Deduction") of Defined
Receipts:
|
•
From
Defined Receipts (other than Flat Sales and Free TV)
|
||
|
oU.S.
and Canada
|
30% |
|
oU.K.
|
35%
|
|
oForeign
|
40%
|
•
From
Flat Sales Defined Receipts
|
15%
|
|
•
From
Free TV Defined Receipts
|
||
|
oU.S.
Network
|
25%
|
|
oU.S.
Non-Network and Canada
|
35%
|
|
oForeign
and U.K.
|
40%
|
B.
|
SECOND
DEDUCTION - Next, from the remaining amount of Defined Receipts,
an amount
equal to the Distribution
Costs plus an additional 10% of Ad and Publicity
Costs.
|
C.
|
THIRD
DEDUCTION - Next, from the remaining amount of Defined Receipts,
if any,
whether or not funds
are actually borrowed for the Picture, and irrespective of the
actual funding arrangements or WDP's
actual financing costs for the Picture or WDP's borrowing rate, as
WDP's
funding charge, an amount
equal to 1.25 times the prime rate of the Bank of America, as the
same may
vary from time to time,
on the total amount of the Fourth Deduction below, commencing from
the
respective dates on which
amounts chargeable under the Fourth Deduction are paid or incurred
(whichever first occurs) and continuing
until the middle of the accounting period in which those amounts
are
recouped.
|
D.
|
FOURTH
DEDUCTION - Next, from the remaining amount of Defined Receipts,
if any,
an amount equal to
the Cost of Production plus an additional 15% of Cost of Production,
which
15% shall be charged concurrently
with the incurring of the respective items of Cost of
Production.
|
E.
|
FIFTH
DEDUCTION - Next, from the remaining amount of Defined Receipts,
if any,
an amount equal to the
Other Contingent Amounts. The
remaining amount, if any, shall be the Contingent Proceeds from which
Lender's percentage or share thereof (the "Contingent Bonus") shall
be
calculated. The
terms used in this Contingent Bonus Formula are defined in, and the
Contingent Bonus hereunder shall be accounted for, pursuant to the
terms
and conditions of the attached Schedule
1:
|
A.
|
"Defined
Receipts" means the aggregate of all receipts actually received by
WDP on
behalf of the Picture in U.S. dollars in the U.S. or in a foreign
currency
which are not Restricted Funds, only
from:
|
1.
|
WDP's
direct distribution of the Picture in
theatres and on television ("TV"), including theatrical
and non-theatrical exhibitions, and free, cable
and pay TV exhibitions.
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2.
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Distribution
of the Picture by any erson
other than WDP licensed by WDP with an
obligation to report receipts and expenses to WDP
(a "Subdistributor"). WDP shall, to the extent
reported and accounted to WDP, treat all such
receipts received and earned by the Subdistributor,
and all distribution costs incurred by
the Subdistributor as though such receipts were
received and earned by WDP and such distribution
costs were incurred by WDP; provided,
however, that WDP's applicable Percentage
Deduction shall include the Subdistributor's
distribution fee, and the licensing or
other arrangement between WDP and each Subdistributor
shall not be taken into account in WDP's
accounting to Lender under this Exhibit CB.
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3.
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Manufacture
and distribution of audio-visual
cassettes, video discs and all electronic, digital
and/or optical storage and/or transmission formats,
any analog or digital reproductions, or any
similar device and/or format embodying the complete
Picture in linear form, whether now known
or hereafter devised ("Video Devices"); provided
that Defined Receipts for Video Devices shall
be: (a) if WDP distributes Video Devices, a royalty
in an amount equal to 20% of the sums actually
received by such entity (less taxes, credits
and returns) from its distribution thereof; or
(b) royalties actually received by WDP from any
unaffiliated third party Video Device distributor
less royalties payable to other third parties.
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4.
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"Flat
Sale" licenses for the theatrical exhibition
of the Picture for a specified period for any
territory or area (excluding the U.S. and Canada)
in consideration of the payment of a specified
amount not calculated by a percentage of
receipts of the applicable licensee.
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6.
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Receipts
from theater box office operated
by WDP in connection with four-wall or road
show exhibitions of the Picture to the extent receipts
from all such exhibitions taken as a whole
exceed costs incurred for all such exhibitions.
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7.
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Cash
subsidies granted by governmental
agencies or prizes to the extent granted
solely with respect to the Picture.
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8.
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The
royalties as provided in Schedules
A (Music) and B (Soundtrack Records,
Merchandising/Publishing), which are attached
hereto and incorporated herein by this reference.
There will be no Percentage Deduction
applied to the royalties under this subparagraph
8. There
shall not be any Percentage Deduction on Defined
Receipts from each of Paragraph 1.1.A.5 and Paragraph
1.1.A.7 above. If the respective costs relating to each of Paragraph
1.1.A.5, 1.1.A.6 or Paragraph 2 of Schedule
B, and applicable Percentage Deduction, if any, pursuant to Paragraph
1.2,
exceed receipts from each of Paragraph 1.1.A.5, 1.1.A.6 or Paragraph
2 of
Schedule B, respectively, such excess costs of each shall separately
be
deductible as a Distribution Cost.
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1.
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Box
office or other amounts retained by
any theater or other exhibition venue (except as
specified in Paragraph 1.1.A.6 hereof) for their own
account; and receipts of: broadcasters and other
transmitters by all means now known or hereafter
devised; wholesale or retail distributors, licensors
or sellers of Video Devices, audio devices
and other products; book or music publishers;
merchandisers and retailers; or any other
similar Person, whether or not any or all such
excluded Persons are owned, operated or controlled
by WDP, Affiliates or Related
Parties.
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2.
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Amounts
received from advance payments
or security deposits unless earned by exhibition
or broadcast, or (subject to Paragraph 1.1.A.2) unconditionally
non-returnable, and refunds,
rebates or adjustments granted to other Persons
by WDP.
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3.
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Amounts
payable in foreign currency and
not received by WDP in the U.S. due to remittance
restrictions ("Restricted Funds"). Restricted
Funds shall not be included in Defined Receipts
nor accounted for unless and until they have
been received by WDP in U.S. dollars in the
U.S. or expended by WDP in the territory in which
held, except as provided in 1.1.B.3 (a) below.
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(a)
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If any
Contingent Bonus becomes
payable to Lender under this Agreement,
Lender may notify WDP in writing
that Lender desires to have included in
Lender's Contingent Bonus, Lender's share
of Restricted Funds in a particular territory
and designate a bank or other representative
in such country, to whom payment
may be made for Lender's account. Upon
WDP's receipt of such notice and all required
permissions, such payment shall be made
to Lender's representative at Lender's expense.
Upon payment of Lender's share of
Restricted Funds, WDP shall have no further
obligation to account for such Restricted
Funds whether as Defined Receipts
or otherwise.
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(b)
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On
Lender's written request, WDP
shall report to Lender the amount of Restricted
Funds (if any) which under this Paragraph
1.1.B.3 have not yet been included
in Defined Receipts as of the closing
date of the most recent statement which
has been furnished to Lender under Paragraph
2.1 below.
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4.
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Amounts
collected in connection with the
distribution of the Picture as taxes or for payment
of taxes (e.g., admission, sales, use or value
added taxes, etc.).
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6.
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Receipts
from remakes, prequels, sequels,
radio or TV series or other derivative uses
of the Picture or any element thereof.
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7.
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Salvage
value or receipts derived from print
stocks, film or tape clips, stock footage, stills,
props, sets, wardrobe, or other items included
in Cost of Production except and only any
sums received from the sale of cars purchased
specifically in connection with the Picture
and sold within six months after completion
of photography, which sums shall be included
in the Defined Receipts of the Picture without
any Percentage Deduction.
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A.
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"Distribution
Costs" means the aggregate of all costs, expenses and charges paid,
advanced or incurred
by WDP or a Subdistributor, directly or indirectly, in connection
with the
distribution, exhibition and exploitation of the Picture, which are
not
included in Cost of Production, including any of the
following:
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B.
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All
discounts, rebates or credits received by WDP specifically relating
to the
Picture shall be taken into account in computing Distribution Costs
hereunder other than those based on: (i) volume or quantity of
advertising, prints,
negatives or other materials, or (ii) the manner or time of payment
of any
Distribution Cost item.
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1.
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A
royalty equal to fifteen percent (15%) of Music Publishing Contingent
Proceeds ("MPCP") received by WDP from the exploitation of music
publishing rights (i.e., mechanical reproduction, public performance,
sheet music/folios and synchronization) to the original music and/or
lyrics written specifically for and synchronized in the Picture
as
generally released (the "Music") shall be included in Defined
Receipts.
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2.
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Music
Publishing Defined Receipts ("MPDR") shall mean all monies actually
received by WDP with respect to the Music excluding any advance,
guarantee
or minimum royalty payment received by WDP in connection with any
subpublishing, collection, licensing or other agreement, unless
such
payment is specifically attributable to the
Music.
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(b)
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All
additional shares of MPDR payable by WDP to such composer(s), lyricist(s)
and/or any other third party co-publishers, administrators or other
participants.
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(c)
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Collection
or other fees customarily and actually charged by The Harry Fox
Agency,
Inc., or any other collection agent. used by
WDP.
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(e)
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All
other administration and exploitation expenses incurred with respect
to
the Music including,
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without
limitation, the costs of producing demonstration records, advertising
and
promotion expenses, costs or amounts payable to third-party publishers,
co-publishers, administrators, publishing participants, subpublishers,
licensees, trustees or collection agents, attorneys' and accountants'
fees
directly related to the Music, and damages and expenses incurred
by reason
of infringement claims, but excluding rents, overhead, salaries
and other
similar general expenses.
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4.
If Lender is entitled to receive a direct royalty or other type
of payment
with respect to the Music, then no portion of MPCP will be included
in
Defined Receipts.
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This ‘SB-2/A’ Filing | Date | Other Filings | ||
---|---|---|---|---|
Filed on: | 10/31/07 | None on these Dates | ||
10/15/04 | ||||
12/11/03 | ||||
7/1/03 | ||||
List all Filings |