Exhibit 10.2
FORM OF EXPLICIT RIGHTS AGREEMENT
EXPLICIT RIGHTS AGREEMENT, dated as of __________, 1998 (this
"Agreement"), by and among Spice Entertainment Companies, Inc., a Delaware
corporation ("Spice Entertainment"), [and any other Spice Entertainment
affiliated entity that is a party to the relevant License Agreement(s) (as
defined below)] (collectively, "Spice"), and Directrix, Inc., a Delaware
corporation and a wholly owned subsidiary of Spice Entertainment as of the
date hereof ("Subco").
WHEREAS, Spice and the licensor listed on Schedule A hereto (the
"Licensor") have entered into the agreement(s) listed on Schedule A hereto (as
currently in effect on the date hereof, the "License Agreement(s)"), pursuant to
which the Licensor has licensed, has agreed to license in the future, or may
license from time to time, to Spice certain rights in connection with certain
adult motion pictures produced, co-produced or otherwise distributed by the
Licensor.
WHEREAS, listed on Schedule A are the titles of the motion pictures
which have been licensed to Spice under the License Agreement(s) as of the date
hereof, and such Schedule shall be revised from time to time to include the
titles of any motion pictures which the Licensor is required to license to Spice
under the License Agreement(s) after the date hereof (all such motion pictures
collectively, the "Licensed Pictures").
WHEREAS, Playboy Enterprises, Inc., a Delaware corporation ("Playboy"),
and Spice Entertainment have entered into an Agreement and Plan of Merger, dated
as of May 29, 1998 (the "Merger Agreement"), wherein they have agreed to merge
(the "Merger") in accordance with the terms and conditions contained therein.
WHEREAS, pursuant to the Merger Agreement, Spice Entertainment will
cause certain assets and liabilities of Spice to be transferred to Subco in
accordance with the terms of this Agreement and the other Related Agreements (as
defined in the Merger Agreement).
WHEREAS, Spice desires to cause Subco to receive certain rights in and
to the Licensed Pictures in accordance with the terms of this Agreement, and the
Licensor has separately consented to all of the terms of this Agreement and the
transactions contemplated hereby by executing a Licensor consent, substantially
in the form of Exhibit A hereto (the "Licensor Consent").
NOW, THEREFORE, in consideration of the premises, and of the respective
covenants and agreements set forth in this Agreement and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each of the
parties hereto hereby agrees and otherwise consents to
the following and, to the extent necessary, hereby agrees to amend, waive or
otherwise modify the License Agreement(s) in order to permit and otherwise
effect the same:
1. C-Band Defined Rights. Effective as of the closing of the Merger
(the "Closing Date"), Spice hereby assigns to Subco all of its right, title and
interest in, to and under the License Agreement(s) insofar as such License
Agreement(s) relate to the C-Band Defined Rights in and to the Licensed
Pictures, subject to any liens or other encumbrances (including sublicenses), if
any, with respect thereto. Effective as of the Closing Date, Subco hereby
unconditionally assumes and undertakes to pay, perform and satisfy, when due,
all of Spice's obligations and liabilities under the License Agreement(s)
insofar as such obligations and liabilities relate to the C-Band Defined Rights
in and to the Licensed Pictures.
2. Internet Defined Rights.
(a) Effective as of the Closing Date, Spice hereby assigns to
Subco all of its right, title and interest in, to and under the License
Agreement(s) insofar as such License Agreement(s) relate to the Internet Defined
Rights in and to the Licensed Pictures, subject to any liens or other
encumbrances (including sublicenses), if any, with respect thereto. Effective as
of the Closing Date, Subco hereby unconditionally assumes and undertakes to pay,
perform and satisfy, when due, all of Spice's obligations and liabilities under
the License Agreement(s) insofar as such obligations and liabilities relate to
the Internet Defined Rights in and to the Licensed Pictures.
(b) Effective as of the Closing Date, Subco hereby grants to
Spice an irrevocable and royalty free non-exclusive sublicense in and to the
Internet Defined Rights in and to the Licensed Pictures.
3. License Fees. Notwithstanding anything contained herein, Subco shall
not be liable to pay to the Licensor or Spice any license fee under the License
Agreement(s). Spice shall remain responsible, to the extent provided under the
License Agreement(s), for all license fees payable to the Licensor thereunder.
4. Definition of Certain Terms. As used in this Agreement, the
following terms shall have the following meanings:
(a) "C-Band Defined Rights" shall mean, in and to any Licensed
Picture, as, and solely to the extent that, such rights have been granted to
Spice in connection with such Licensed Picture under the applicable License
Agreement, the right to transmit via C-Band and sublicense and distribute for
transmission via C-Band, the Explicit Version of such Licensed Picture and the
Explicit Still Images with respect to such Explicit Version, including the right
to edit, reproduce and to make dubbed and/or translated variations of, such
Explicit Version or Explicit Still Images, as the case may be (provided that any
motion picture or still
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image so edited or varied continues to constitute an "Explicit Version" or an
"Explicit Still Image" as defined herein, as the case may be), to advertise,
promote and market such Explicit Version or Explicit Still Images (provided that
no advertising may disparage Playboy), to cause the production of trailers of
such Explicit Version and to perform, disseminate and exhibit such trailers in
accordance with such License Agreement, and to engage in such other incidental
activities consistent with the foregoing to the extent reasonably necessary to
exploit the right to transmit via C-Band and to sublicense and distribute for
transmission via C-Band such Explicit Version or Explicit Still Images, as the
case may be.
(b) "Explicit Still Images," with respect to the Explicit
Version of any Licensed Picture, shall mean all of the still images included
within such Explicit Version or included with such Explicit Version by the
Licensor, the content of which would generally be considered in the adult
industry to be that of "adult" still images and equally as explicit as, or more
explicit than, "hot cable" still images and which are otherwise substantially
similar in content and degree of explicitness to the still images currently
featured on the Internet sites maintained by Emerald Media, Inc.
(c) "Explicit Version," with respect to any Licensed Picture,
shall mean the version of such Licensed Picture, if any, which is designated as
the "Explicit Version" (or the analogous description) of such Licensed Picture
under the terms of the applicable License Agreement, the content of which would
generally be considered in the adult industry to be that of "explicit" adult
motion pictures and more explicit than the "hot cable" or "cable" version of
such Licenced Picture, and which is otherwise substantially similar in content
and degree of explicitness to the movies and related programming currently
featured on the C-Band channels maintained by Emerald Media, Inc.
(d) "Internet Defined Rights" shall mean, in and to any
Licensed Picture, as, and solely to the extent that, such rights have been
granted to Spice in connection with such Licensed Picture under the applicable
License Agreement, the right to transmit worldwide via the Internet and
sublicense and distribute for transmission worldwide via the Internet the
Explicit Version of such Licensed Picture and the Explicit Still Images with
respect to such Explicit Version, including the right to edit, reproduce and to
make dubbed and/or translated variations of, such Explicit Version or Explicit
Still Images, as the case may be (provided that any motion picture or still
image so edited or varied continues to constitute an "Explicit Version" or an
"Explicit Still Image" as defined herein, as the case may be), to advertise,
promote and market such Explicit Version or Explicit Still Images (provided that
no advertising may disparage Playboy), to cause the production of trailers of
such Explicit Version and to perform, disseminate and exhibit such trailers in
accordance with such License Agreement, and to engage in such other incidental
activities consistent with the foregoing to the extent reasonably necessary to
exploit the right to transmit via the Internet and to sublicense and distribute
for transmission via the Internet such Explicit Version or Explicit Still
Images, as the case may be.
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(e) "Territory" shall mean the United States and Canada
(including all of the territories and possessions of the foregoing) and the
islands of the Caribbean.
(f) "via C-Band" shall mean via C-Band satellite, in either
the analog or digital format, intended and otherwise authorized solely for
reception by C-Band subscribers located solely within the Territory.
5. Access to Explicit Versions. Each of Spice and Subco hereby
reaffirms that after the Closing Date Spice shall remain the sole and exclusive
owner, to the extent otherwise provided under the License Agreement(s), of the
master tapes, videotape dubs or other tapes of all versions of the Licensed
Pictures, including the Explicit Version (the "Tapes"). Subco shall be permitted
reasonable access to such Tapes to the extent necessary to exploit the rights
assigned to it hereunder. Subco shall be permitted to make copies of any of the
Tapes and to remain the sole and exclusive owner of such copies to the extent
otherwise permitted under the License Agreement(s) and subject to the terms of
this Agreement. All costs and expenses incurred by Spice or Subco in connection
with any access or other exploitation of the Tapes by Subco, including, without
limitation, all duplication expenses, shall be borne by Subco.
6. Other Rights Under the License Agreement(s); Licensed Pictures.
Spice shall retain all rights, title and interests under the License
Agreement(s) not expressly assigned to Subco in Section 1 or Section 2 hereof,
including, without limitation, all rights relating to the Explicit Versions of
the Licensed Pictures that are not C-Band Defined Rights or Internet Defined
Rights. All terms of the License Agreement(s) not amended or otherwise modified
by this Agreement shall remain in full force and effect as currently provided
under the License Agreement(s). Notwithstanding anything contained herein, the
Licensed Pictures shall not include any motion pictures licensed to Spice
pursuant to any renewals, extensions, amendments or other modifications of the
License Agreement(s) (including the Schedules thereto) made after the Closing
Date. Spice hereby agrees that, in connection with any motion pictures licensed
to Spice pursuant to any renewals, extensions, amendments or other modifications
of the License Agreement(s) (including the Schedules thereto) made after the
Closing Date, Spice will acquire (with respect to Internet Defined Rights) only
a non-exclusive license in and to the Internet Defined Rights in and to such
motion pictures. Spice hereby agrees that it will not directly or indirectly,
enter into any agreement or other arrangement to acquire any licensing,
distribution or transmission rights with respect to any Explicit Programming or
Explicit Still Images (as such terms are defined in the Non-Competition
Agreement between Playboy and Subco) for transmission during the Restricted
Period (as defined in such Non-Competition Agreement) via C-Band. Each of Spice
and Subco hereby consents to the terms contained in the Licensor Consent,
including, without limitation Section 3 thereof. Furthermore, Spice agrees that
the terms of Section 5 of this Agreement shall apply in a substantially similar
manner to any motion pictures licensed by the Licensor to Subco under Section 3
of the Licensor Consent.
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7. No Cross-Default. The parties hereto are independent entities and
nothing herein shall be construed to constitute any parties hereto as partners
or as joint venturers, or as agent of any one or more of the other parties. To
the extent any part of the License Agreement(s) are assigned to Subco in
accordance with Section 1 or Section 2 hereof, such assigned parts shall be
understood to constitute agreements between the Licensor and Subco which are
entirely separate agreements from the portion of the License Agreement(s)
between the Licensor and Spice which is not so assigned. Accordingly, no party
hereto shall be responsible, or otherwise bear any liability or obligation, for
any default or breach of the terms of the License Agreement(s) or this Agreement
by any other party hereto.
8. Further Assurances. The parties hereto shall cooperate with one
another and shall execute and deliver, or cause to be executed and delivered,
such documents and other papers, and take such further actions, as may be
reasonably requested or desirable to carry out the provisions hereof and to
consummate the transactions contemplated hereby.
9. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
10. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of New York applicable to agreements made
and to be performed entirely within such state without regard to conflicts of
law principles thereof.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed on its behalf as of the day and year first above-written.
SPICE ENTERTAINMENT COMPANIES, INC.
By:
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Name:
Title:
[OTHER SPICE ENTITIES]
By:
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Name:
Title:
DIRECTRIX, INC.
By:
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Name:
Title:
SCHEDULE A
Licensor License Agreement(s) Licensed Picture(s)
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