Exhibit 10.1
Portions of this Exhibit have been omitted pursuant to a request for
confidential treatment filed with the Securities and Exchange Commission. The
omissions have been indicated by asterisks ("*****"), and the omitted text has
been filed separately with the Securities and Exchange Commission.
PLAYBOY ENTERTAINMENT GROUP, INC.
March 31, 2008
Melinda C. Witmer,
Executive Vice President and
Chief Programming Officer
Time Warner Cable LLC
290 Harbor Drive
Stamford, CT 06902
Re: First Amendment to the Affiliation Agreement by and between Playboy
Entertainment Group, Inc.; Spice Entertainment, Inc.; and Spice Hot
Entertainment, Inc. (collectively "Playboy") and Time Warner Cable Inc.
dated as of July 8, 2004 (the "Affiliation Agreement")
Dear Melinda:
This letter agreement, when duly executed by Time Warner Cable LLC (as a
successor to Time Warner Cable Inc.) ("TWC") and Playboy below, shall constitute
TWC's and Playboy's first amendment to the Affiliation Agreement, and, except as
set forth in Paragraphs 13 and 14 below, shall be effective as of the date
indicated above (the "Amendment Date"). Terms that are capitalized but not
defined herein shall have the meanings ascribed to them in the Affiliation
Agreement.
For good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, Playboy and TWC hereby agreed to amend the Affiliation
Agreement as follows:
1. The following definitions are added to Section 1(a) of the
Affiliation Agreement:
"Multiplex" means the packaging of Pay Per View Purchases as a single
offering, such that for a single payment a purchasing Subscriber is
permitted to view one or more "Multiplex Services" (as defined below),
together with other adult channels as determined by Affiliate, all for a
single payment for a period not to exceed twenty four (24) hours.
"Multiplex Services" means the Playboy TV Service and/or the Spice
Services actually distributed by Affiliate.
2706 MEDIA CENTER DRIVE, LOS ANGELES, CALIFORNIA 90065 323.276.4075 /
FAX 323.276.4502
Execution Copy
"Offering Percentage" means the percentage, derived on a monthly basis based on
reports provided by Affiliate, calculated by dividing: (a) the number of
Affiliate's Subscribers that have the Playboy TV SVOD Service available to them
from a Time Warner Cable System; by (b) the total number of Affiliate's
Subscribers in Time Warner Cable Systems that offer SVOD.
"Qualifying Benchmark" means the status whereby:
(1) Either: *****
2. Subsection 4(b) of the Affiliation Agreement, "Playboy TV SVOD Service
Description", is amended by the replacement of the third sentence of such
subsection with the following sentences:
The Playboy TV SVOD Service shall consist of a minimum of fifty (50) hours of
VOD Programs each month. In the event Playboy makes any other or any additional,
larger SVOD package offerings available to any distributor, TWC will have the
right but not the obligation to make such offerings available to Subscribers
under the same terms applicable to the Playboy TV SVOD Service. Notwithstanding
the foregoing, the Playboy SVOD Service shall not include full-length movie
assets (currently known as "Playboy Director's Cut") that are featured as part
of the Spice Services.
3. Subsection 4(f) of the Affiliation Agreement, "VOD Package Service(s)", is
amended by inserting the following after the last sentence of Subsection
4(f):
Within ninety (90) days following the execution of the First Amendment, Network
will offer the following VOD Package Services:
(i) Too Hot for TV VOD Package Service. Subject to the terms of this
Section 4(f), Playboy will make available to Affiliate a VOD Package Service
entitled "Too Hot for TV" consisting of fourteen (14) hours of Programs (the VOD
Package Service referred to herein as the "Too Hot for TV VOD Package Service").
The Programs in the Too Hot for TV VOD Package Service shall be
professionally-produced adult full-length programs selected by Playboy, edited
to comply with the TVMA rating, and shall focus on real people in unusual or
novel sexually oriented situations with the level of depicted explicitness being
the same as (or less explicit than) programming shown on premium channels such
as HBO, Showtime and Cinemax. The depiction of sex in these episodes may be real
or simulated.
(ii) Gay Targeted VOD Package Service. Subject to the terms of this
Section 4(f), Playboy will make available to Affiliate a VOD Package Service
consisting of twenty (20) hours of Programs (the VOD Package Service referred to
herein as the "Gay Targeted VOD Package Service"). The Programs in the Gay
Targeted VOD
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Package Service shall be professionally-produced adult programs selected by
Playboy, targeted to the male gay community, edited to a standard no more
explicit than the Partially Edited Standards. Each Program in the Gay targeted
VOD Package Service: (v) shall depict homosexual situations and nudity among
consenting adults; (w) may depict erect genitalia, male on male fellatio and
simulated or implied sexual intercourse; (x) shall not depict actual anal
penetration, licking or anal sexual play of any kind; (y) shall not depict male
ejaculation, sexual violence or excessive nonsexual violence, incest, sadism,
sadomasochism, forced bondage in scenes containing sexual activity or forced
bondage carrying sexual innuendo or sexual connotations, illegal or
irresponsible drug usage, minors or scenes with adults being depicted as minors;
and (z) shall not include racist or sexist language.
(iii) International VOD Service. Subject to the terms of this Section
4(f), Playboy will make available to Affiliate a VOD Package Service consisting
of twenty (20) hours of Programs (currently referred to as "Caliente"). The
Programs in the International VOD Package Service shall be
professionally-produced internationally produced adult programs featuring
foreign men and women in the language and locations of each country, the
languages being other than English (and at any particular time, not more than
ten (10) hours of Programs in such package shall be in a Hispanic language),
edited to be no more explicit than the Partial Edited Standards.
4. Subsection 4(j) of the Affiliation Agreement, "Services Provided in
Entirety", is amended by the deletion of the word "national" in the
penultimate sentence in the subsection.
5. Subsection 4(k) of the Affiliation Agreement, "High Definition
Programming", is amended by the deletion of all but the first sentence of
the Subsection, and inserting the following prior to the first sentence:
"Network represents and warrants that no distributor has, or will have at
any time during the Term after October 1, 2007, the exclusive rights to
distribute HD Programs."
6. A new Subsection 4(n) is added to the Affiliation Agreement by inserting
the following:
(n) Multiplex Offering. Affiliate may include Playboy TV Service
and/or any Spice Service distributed by Affiliate in a Multiplex.
7. Paragraph 8 of the Affiliation Agreement, "Fees", is amended by adding
before Subsection 8(a) the following: *****
8. Subsection 8(a) of the Affiliation Agreement, "Service Fees", is deleted
in its entirety and replaced with the following:
(a) Qualifying Benchmark Rates. If, for a particular calendar month, Affiliate
has satisfied the Qualifying Benchmark, then the Fees set forth in Subsections
8(a)(1) - 8(a)(11) shall be applicable for the respective Services.
*****
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9. *****
10. The following shall be added as a new Subsection 10(d)(i) to the
Affiliation Agreement: *****
11. Effective on the Amendment Date, Subsection 10(d) of the Affiliation
Agreement, "Marketing Allowance" shall be deleted in its entirety and the
following shall be inserted as a new Subsection 10(d) of the Affiliation
Agreement: *****
12. Section 2 of the Affiliation Agreement, "Rights", is amended to add a new
Subsection (d) as follows:
(d) Other Rights. *****
13. Effective upon the earlier of: (i) termination of carriage of Spice and
Spice 2 in Affiliate's Cincinnati, Ohio division; or (ii) seventy-five
(75) days following the Amendment Date, the definition of "Spice Services"
in Section 1(a) of the Affiliation Agreement is amended to delete after
the words "known as" the phrase '"Spice," "Spice 2,"'.
14. *****
15. Affiliate acknowledges that Network will cease distributing the Spice and
Spice 2 Services seventy-five (75) days following the Amendment Date and
agrees that Network will have no obligation to provide such Services in
the future. *****
16. *****
Except as expressly set forth herein, all other terms and conditions of
the Affiliation Agreement remain in full force and effect.
Your signature below indicates your understanding and agreement with the
above terms and conditions.
Sincerely,
PLAYBOY ENTERTAINMENT GROUP, INC.
By: /s/ Bob Meyers
-----------------------------------------
Name: Bob Meyers
Title: Executive Vice President and President
SPICE ENTERTAINMENT, INC.
By: /s/ Bob Meyers
-----------------------------------------
Name: Bob Meyers
Title: Executive Vice President and President
SPICE HOT ENTERTAINMENT, INC.
By: /s/ Bob Meyers
-----------------------------------------
Name: Bob Meyers
Title: Executive Vice President and President
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AGREED AND ACCEPTED:
TIME WARNER CABLE LLC
BY: /s/ Melinda C. Witmer
--------------------------------
NAME: Melinda C. Witmer
TITLE: Executive Vice President
and Chief Programming Officer
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EXHIBIT A
Market/VOD Catcher Location Division Spice XX Spice X
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***** ***** ***** *****
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