Contract No. 3828
TELEVISION LICENCE AGREEMENT
This Agreement is made as of June 24, 2003 between NELVANA
INTERNATIONAL LIMITED, a registered Irish corporation ("Nelvana"),
Airport House, Offices 228-230, Shannon Free Zone, Shannon, County
Clare, Ireland and OMNI BROADCASTING ("Licensee"), 4322 Wilshire
Blvd., Suite 300, Los Angeles, CA 90010 U.S.A. regarding the programs
described below (the "Programs"). Nelvana and Licensee agree as
follows:
1. Description of Programs:
(a) Title: Birdz (Episodes 1-13)
(b) Duration: Approximately twenty-three (23) minutes each
(c) Number: Thirteen (13)
2. Licensed Rights:
(a) Media: All Free TV
(b) Exclusivity: The rights granted by Nelvana to
Licensee in the Programs are exclusive in the
Territory against All Free TV for the Term, except
for Puerto Rico where the rights granted by Nelvana
to Licensee in the Programs are non- exclusive
against All Free TV for the Term.
(c) Languages: English
(d) Authorized Stations: Omni stations in the Territory
(e) Maximum Telecasts
per Program: Unlimited
(f) Special Provisions: None
3. Territory: United States, its territories, and its possessions.
4. Term: Starting on July 1, 2003 and ending on July 1, 2006.
5. Holdbacks: None
6. Licence Fee: US$5,000, per episode, or US$65,000 total.
7. Payment Schedule: Licensee shall pay Nelvana fifty percent (50%) of
all Advertising Revenues (as defined below). Such
amounts shall be paid no later than thirty (30)
days after the last day of each calendar quarter
during the Term. If upon expiry of the Term, or
upon termination of this Agreement, such payments
have not equaled or exceeded the entire amount of
the Licence Fee, Licensee shall pay any
outstanding balance in full within thirty (30)
days.
"Advertising Revenues" means all gross income of
any kind received by or credited to Licensee that
is earned and accrued during the Term for
advertising aired on the Authorized Stations
during the broadcast of the Programs, less fees
paid to third party advertising agencies.
8. Delivery Requirements:
(a) Physical Materials: NTSC(525)
Digital Betacam
(b) Documents: Credit List Synopsis Available press materials
Music cue sheets Digital Images Trademark
First Telecast Dates Reporting Form
(c) Method of Delivery: Physical Delivery
Loan of Physical Materials, for 30 days
(d) Physical Materials will be delivered to Licensee, at such address
as Licensee shall advise Nelvana in writing, at the following
times subject to payment of the following costs:
Delivery Date: Upon execution of this Agreement.
Shipping Costs of Physical Materials to Licensee covered by
Nelvana, and shipping costs to return Physical Materials to
Nelvana at 32 Atlantic Avenue, Toronto, Ontario, M6K IX8 or to
another destination as Nelvana shall advise covered by Licensee
9. The following notice, together with any anti-piracy notice, will
appear on all copies of the Programs and al1 advertising and
promotional materials:
Birdz Series c 1998 Nelvana Limited
All Rights Reserved.
GENERAL TERMS
10. Subject to the terms of this Agreement, Nelvana hereby licenses
to Licensee the Licensed Rights in the Programs during the Term
throughout the Territory, on the existing signals of the Authorized
Stations and in accordance with Section 2 above.
11. If Nelvana does not deliver to Licensee Physical Materials in the
Languages, then Licensee will have the non-exclusive right, after
consultation with Nelvana, to dub or subtitle the Programs in the
authorized Languages ("Dubbed Versions"). Nelvana shall own all
Dubbed Versions. Nelvana shall have access to the Dubbed Versions at
no cost to Nelvana.
12. The parties specifically acknowledge that: (a) the Licensed
Rights do not include any interactive rights in the Programs; (b)
the Licensed Rights do not include exploitation of the Programs on
the Internet; (c) Licensee will only exploit the Programs
individually and in their entirety, and Licensee may not, except as
specifically permitted by this Agreement, modify or edit the
Programs, add any material to the Programs, or combine any Program
with any other Program or with any other program or work; (d) the
incidental reception of the signal transmitted by third parties
containing any Program within the Territory due to overlapping
signal contours, or the simultaneous retransmission of that signal
by cable television or other retransmission systems within the
Territory, will not infringe Licensee's rights; (e) Licensee's
rights include, unless otherwise stated, the right to transmit the
Programs by means of satellite which may cause overspill due to the
inherent capability of satellites to beam down signals which are not
confined to territorial boundaries, and that the occurrence of such
overspill shall not constitute a breach of this Agreement; (t)
Nelvana will have the right to exhibit or authorize others to
exhibit in any media throughout the Territory during the Term
excerpts from each Program (not to exceed 2 minutes in length) for
purposes of promoting the Program, individuals associated with the
Program, and/or Nelvana and its affiliates, associates and
licensees; and (g) Licensee is not entitled to apply for or receive
any retransmission income, blank tape or similar levies, tax rebates
or other income that may be payable to authors, producers and
licensees from agencies, societies, or organizations such as AGICOA,
VGF and PROCIREP.
13. All rights not specifically licensed to Licensee in this
Agreement are expressly reserved to Nelvana including, without
limitation, all theatrical, non- theatrical, video, merchandising
and interactive rights. Nelvana, however, agrees that in connection
with its exercise of the interactive rights it will not use and/or
authorize the use in a linear manner of more than 10 minutes from
any single Program.
14. In consideration for, and as a condition precedent to the
exercise of, the Licensed Rights, Licensee shall pay to Nelvana the
Licence Fee, less only any withholding tax. Licensee will provide
Nelvana with all documentation needed to obtain any available credit
or refund of such tax.
15. Licensee will make all payments due to Nelvana by wire transfer
in United States dollars, free of any transmission charges, to the
following account: Nelvana International Limited, US Dollar Currency
Account, Ulster Bank Limited, International Trade Services, Dublin,
Ireland, Swift Code Address: ULSBIE2D, Telex: 93638, Account Number:
1813329102.
16. Licensee will deliver to Nelvana International Limited at Airport
House, Offices 228-230, Shannon Free Zone, Shannon, County Clare,
Ireland: (a) a report setting out the first telecast dates and any
translated Program titles, on the forms provided by Nelvana. within
30 days of the first exercise of any of the Licensed Rights; and (b)
a monthly report setting out the number of telecasts for each
Program for the month, within 30 days of the end of such month.
17. Upon termination or expiration of the Agreement for each Program,
Licensee will at Nelvana's election either: (a) return all Physical
Materials, Documents and Dubbed Versions (if any) to Nelvana; (b)
destroy them and provide Nelvana with a customary certificate of
destruction; or (c) store them until notified by Nelvana to ship the
Physical Materials, Documents and/or Dubbed Versions to a
destination as Nelvana shall advise.
18. Nelvana will provide Licensee with a list of all required screen
credits (unless such list is already contained in the Program) and
paid advertising requirements, as well as any credit, advertising
and dubbing restrictions. Licensee will comply with all of the
above.
19. Licensee will have the non-exclusive right at its sole expense
to: (a) advertise, publicize, and promote each Program; (b) add
Licensee's name or logo prior to the beginning or after the end of
each Program; and (c) insert commercial announcements within a
Program only if approved in writing by Nelvana.
20. Licensee may not: (a) alter or delete any title, credit, logo,
copyright or trade-mark notice appearing on any Program; (b) add any
advertisements, commercials or other material in or to any copy of
the Program (other than Licensee's name or logo), without Nelvana's
prior written approval; or (c) use any clips from any single Program
that exceeds 2 minutes in total for permitted advertising.
21 Nelvana or its designee will have the right of prior approval
regarding all elements of the advertising and promotional can1paign
for the Programs if Licensee utilizes artwork not provided by
Nelvana.
22. Licensee will prominently display the Nelvana trademark and logo
("Nelvana Trade-marks") and the Series logo ("Series Logo") (as
provided by Nelvana) on all promotional and advertising material. No
other trade- mark or logo will be displayed more prominently than
the Nelvana Trade-marks and Series Logo.
23. Nelvana represents, warrants and covenants that: (a) it is
entitled to enter into this Agreement; (b) to the best of its
knowledge, no part of the Programs will infringe upon the rights of
any person; and (c) the performing rights for any music in the
Programs are in the public domain or controlled by a performing
rights society.
24. Licensee represents, warrants and covenants that: (a) it is
entitled to enter into this Agreement; (b) it shall obtain, directly
or indirectly, public music performance and droits de reproduction
licenses and, as the case may be, any other literary and artistic
property rights contained in the Programs as may be required by the
applicable local performing and mechanical reproduction rights
organizations in the Territory for the exhibition of the Programs;
and ( c) to the best of its knowledge, no part of any materials
created or modifications made by or for Licensee including, without
limitation, any Dubbed Versions, advertising, promotional or
packaging material or artwork, will infringe upon the rights of any
person.
25. Nelvana and Licensee will indemnify and hold harmless each other
and their respective officers, directors, affiliates, employees,
successors and permitted assigns from all claims, liabilities and
expenses (including reasonable legal fees) arising out of any breach
of their respective representations, warranties or obligations
pursuant to this Agreement. Nelvana's obligation to indemnify
Licensee hereunder shall be limited to the amount of the Licence
Fee.
26. If either party breaches a material provision of this Agreement
and fails to cure such breach within 45 days of notice (10 days for
failure to pay), then the other party may terminate this Agreement
and exercise any other remedies.
27. Licensee may not assign this Agreement, or sublicense or use an
agent to exploit any rights granted to Licensee except with
Nelvana's prior approval. Nelvana may assign or license any rights
under this Agreement, but if such assignee or licensee fails to
fulfill any obligation set out in this Agreement, Nelvana will
remain liable for such obligation.
28. This Agreement constitutes the entire agreement between the
parties regarding the subject matter which it concerns and
supersedes any prior agreements, understandings and negotiations
between the parties or their representatives. No modification of any
of its terms shall be valid unless in writing and signed by both
parties. This Agreement shall be governed and construed by the laws
of the Republic of Ireland.
IN WITNESS WHEREOF, Nelvana and Licensee have executed this Agreement.
NELVANA INTERNATIONAL LIMITED
by: /s/ NELVANA INTERNATIONAL LIMITED
Authorized signing officer
OMNI BROADCASTING
by: /s/ ROGER NEAL SMITH
Authorized signing officer