CONFIDENTIAL TREATMENT REQUESTED FOR PORTIONS OF THIS DOCUMENT. PORTIONS FOR WHICH CONFIDENTIAL TREATMENT
IS REQUESTED HAVE BEEN MARKED WITH THREE ASTERISKS [***] AND A FOOTNOTE INDICATING “CONFIDENTIAL TREATMENT REQUESTED”.
MATERIAL OMITTED HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


 


DATED
26th June 2008


 


AGREEMENT


 


BETWEEN


 


Cathay Pacific Airways
Limited


AND


Hong Kong
Dragon Airlines Limited


 


AND


 


Inflight Productions
Limited


 


For
the Supply of


 


Programming
and Production Services


For
Inflight Entertainment


 









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TABLE OF CONTENT


 


	1. 	DEFINITIONS
    AND INTERPRETATION	4
	 	 	 
	2.	PROVISION OF SERVICES	8
	 	 	 
	3.	TERM	8
	 	 	 
	4.	IFP'S OBLIGATIONS	8
	 	 	 
	5.	AIRLINE  OBLIGATION	13
	 	 	 
	6.	SERVICE COSTS	15
	 	 	 
	7.	SHARING OF COST
    SAVING	20
	 	 	 
	8.	PAYMENT SCHEDULE,
    INVOICING AND  REPORTING	21
	 	 	 
	9.	CANCELLATION	22
	 	 	 
	10.	APPROVAL PROCESS	23
	 	 	 
	11.	BUDGET  PROCESS
     AND  MEETINGS	24
	 	 	 
	12.	BUSINESS PARTNERS	25
	 	 	 
	13.	INTELLECTUAL PROPERTY
    RIGHTS	25
	 	 	 
	14.	INSURANCE	26
	 	 	 
	15.	REPRESENTATIONS
    AND  WARRANTIES	26
	 	 	 
	16.	TERMINATION	26
	 	 	 
	17.	INDEMNITY BY IFP	27
	 	 	 
	18.	ENTIRE AGREEMENT	28
	 	 	 
	19.	REMEDIES CUMULATIVE	28
	 	 	 
	20.	NO WAIVER	28
	 	 	 
	21.	SEVERANCE	28
	 	 	 
	22.	AMENDMENT	28
	 	 	 
	23.	CONFIDENTIALITY	28
	 	 	 
	24.	ADVERTISING	29
	 	 	 
	25.	ASSIGNMENT	29
	 	 	 
	26.	EXPENSES	29
	 	 	 
	27.	FORCE MAJEURE	29
	 	 	 
	28.	AUDIT	30
	 	 	 
	29.	RIGHT OF
    REPLACEMENT	30


 




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	30.	NO AGENCY
    OR PARTNERSHIP	31
	 	 	 
	31.	NOTICES	31
	 	 	 
	32.	SUCCESSORS	32
	 	 	 
	33.	LAW  AND JURISDICTION	32


 


	SCHEDULE  1- PROGRAMME
    SPECIFICATIONS	34
	 	 
	SCHEDULE  2- PROGRAMMING GUIDELINES	51
	 	 
	SCHEDULE  3- CONTACT AND  DELIVERY
     DETAILS	53
	 	 
	SCHEDULE  4 - BUDGET  FOR  2007	56
	 	 
	SCHEDULE 5- KEY PERFORMANCE INDICATORS	57


 




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THIS AGREEMENT is
dated 26th June 2008 and is made:


 


BETWEEN


 


		(1)	CATHAY PACIFIC AIRWAYS LIMITED, a company incorporated
under the laws of Hong Kong, with its place
of business at Cathay City, 8 Scenic Road,
Hong Kong International Airport, Lantau, Hong Kong (hereinafter
referred to as "Cathay"),



 


		(2)	HONG KONG DRAGON AIRLINES LIMITED, a company
incorporated under the laws of Hong Kong,
with its place of business at Dragonair
House, 11 Tung Fai Road, Hong Kong
International Airport, Lantau, Hong Kong (hereinafter referred
to as "Dragonair")



(with Cathay and
Dragonair together referred to as "the Airline")


 


		(3)	INFLIGHT PRODUCTIONS
LIMITED, a company incorporated under the laws of
United Kingdom, with its place of business at
15 Stukeley Street, London, WC2B 5LT, United Kingdom (hereinafter referred to as "IFP"),



 


(together the "Parties"
and each a "Party" as the
case may be).


 


BACKGROUND


 


		(A)	The Airline wishes
to appoint IFP to provide inflight programming services for
Audio, Western Movies and Western Short Feature Programmes on the Airlines'
Aircraft including but not limited to the following:



 


		(i)	For Audio programming, the
services include, but are not limited to, negotiation of
Mechanical Royalties and Presenter fees, account management,
industry expertise and technical processes
such as programming, editing, duplication, encoding, quality
control, labelling etc.
and delivery;



 


		(ii)	For video programming of Western Movies and Western Short Features, the services include, but are
not limited to, negotiation of License Fees, account management, industry expertise and technical processes such as programming,
editing, encoding, subtitling, quality control, labelling, etc. and delivery;



 


		(B)	IFP has considerable expertise
in the above areas and has represented
to Airline that it is well qualified to be appointed hereunder.
The Parties wish to
enter into this Agreement
to set out the terms on which IFP will provide the Services
to the Airline.



 


BY WHICH IT IS AGREED as follows:-


 


		1.	DEFINITIONS AND INTERPRETATION



 


		1.1	Unless the context otherwise requires
in this Agreement, the following
expressions have the following meanings:-



 


	"AOD"	means
     audio  on  demand  and
     shall  comprise  of  Music Albums and Audio
    Programmes, offered to
    passengers on Aircraft equipped  with
     an AVOD system,
     which are accessed  using  AOD functions
    such  as  fast  forward, rewind and
    pause;
	 	 
	"AVOD"	means audio and video on demand and means Cathay's digital system using  video  and  audio  compression  to supply Programmes to passengers when requested;


 




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	"Agreement"	means this agreement and any and all schedules, appendices and exhibits attached  to it or incorporated  in it  by reference, as varied from time to time in accordance with its terms;
	 	 
	"Aircraft"	means all aircraft  whether  video  cassette  based  (Non-AVOD Aircraft) or AVOD equipped  (AVOD Aircraft) operated by the Airline, during the Term of this Agreement;
	 	 
	"Asian Movies"	means featured  film  which  is  shown  in  Asian language including but not limited to Cantonese, Mandarin, Japanese, Korean and Hindi;
	 	 
	"Asian Short Features"	means short features  programme which  is shown  in Asian language including but not limited to Cantonese, Mandarin, Japanese and Hindi;
	 	 
	"Audio"	means audio programmes  that  include  Radio  Channel, Music Albums and Boarding Music, refer to programme specification in Schedule 1;
	 	 
	"Boarding Music"	means  the  music played  on board Aircraft  prior  to  take off and landing;
	 	 
	"Business Partners"	means  any  other  supplier, sub-contractor,  consultant, agent,  licensor, either  future  or  existing,  nominated  by the Airline;
	 	 
	"BOP"	means the Airlines' Budget Operating Plan  circulated annually between August and October each year detailing flights  and  routes  scheduled  for  the  following year. It is a guideline document  only  and  subject  to change;
	 	 
	"COs"	mean the  CDs which  are  used  on  non-AVOD  Aircraft incorporating the Radio Channel Programmes;
	 	 
	"Digital Media"	means  Programmes in the form of an encoded compression  file rather than a video cassette or CDs;
	 	 
	"Distributor"	means the distributor from whom a Programme is licensed and who owns the right to License and distribute the Programme for airline use;
	 	 
	"Duplication"	means the act of making  cassette copies from the Master for video programmes and the act of making  copies from the Intermaster for audio programmes;
	 	 
	"Effective Date"	means 1st
April 2007 (April on board cycle);
	 	 
	"Encoding"	means the process of transforming the Programme into a digitally compressed file ;
	 	 
	"Exhibition"	means the estimated number  of  flights on  which  the Programmes will be shown, otherwise known as screenings, which are calculated from the Airline's BOP during each annual budget process;


 




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	"Exhibition Period"	means  the  time  period  during which  the  Airline  is authorised  to exhibit  the Programmes  on board the Aircraft.
	 	 
	"Flashcard"	means the  proprietary  card containing  digital  storage used to transfer  music and speech onto aircraft  IFE Systems;
	 	 
	"IFE"	means  the Airline's inflight entertainment programmes;
	 	 
	"Interactive Screens"	means the  screens, which show information  regarding the  Programmes to  help  passengers  navigate  and  use the AVOD system in order to arrive  at the desired Programme choice;
	 	 
	"Intermaster"	means digitally encoded CD  combining  two or more Radio  Programmes, used  to  duplicate CDs  for  onboard use;
	 	 
	"Key Performance Indicators"	means  a  set  of  agreed parameters by  which the  Airline  measures the  performance of IFP, refer  to Schedule  5 for details;
	 	 
	"License"	means an agreement given  by a Distributor to permit the use of the Programmes on the Aircraft;
	 	 
	"License Fee"	means  the  amount  negotiated by  IFP, and  paid  by  the Airline, that permits the  Airline  to  play  the  contracted Programmes;
	 	 
	"Management Fee"	means  the  annual fees  agreed between the  Parties  for IFP to carry out the  Services;
	 	 
	"Mechanical Royalties"	means those royalties and fees required  to copy musical works from  one  medium to  another during the recording and duplication process;
	 	 
	"Master"	means the original master copy  of a Programme Licensed from  the  Distributor;
	 	 
	"MPAA"	means the Movie Pictures  Association of America;
	 	 
	"Music Albums"	means  a selection of  music  albums which  form  Cathay's Audio-on-Demand library and  are  updated regularly  as required by Cathay;
	 	 
	"Performance Reviews"	means the  review
    which will  be
     conducted  twice
    a year whereby the Airline will review IFP's performance
    against the  agreed Key Performance Indicators.
	 	 
	"Presenter"	means  the professional radio presenter or artist employed to work specifically on the Airline's account;
	 	 
	"Programmes"	means programmes to  be  supplied by  IFP  under  terms and conditions of this Agreement.  These programmes include all Western Movies, Western Short Features Programmes and all Audio  programmes.


 




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	"Programming Costs"	means  the  total  cost  incurred in  compiling the  Audio Programmes  based  on  an  hourly  rate  and  time  in  the audio studio and on a computer edit facility;
	 	 
	"Public  Performance Rights"	means the  right to  perform  music  on  board the Aircraft including that contained in Audio, Western Movies and Western Short Features;
	 	 
	"Personnel"	mean IFP's personnel  who  will  provide  the  Services  to the Airline during the Term of the Agreement;
	 	 
	"Radio Channel"	means the channels under which Audio Programmes compiled  by IFP are offered  to  all passengers  on board an Aircraft;
	 	 
	"Services"	mean the supply of all required services for inflight programming  for  Audio,  Western  Movies  and  Western Short Features Programmes for Airline  by IFP hereunder including the services specified in Clause 4 of this Agreement;
	 	 
	"Service Costs"	has the meaning  ascribed to it in Clause 6;
	 	 
	"Sting"	means airline, channel or genre promotional  material;
	 	 
	"Sub-load Ticket"	means a ticket
     issued by the  Airline  to IFP for
    meetings in  Hong  Kong,  which
     is  not  a
     confirmed ticket but  a
    stand-by  ticket and has the same boarding
     priority as
    if IFP's Personnel were
    an Airline employee
     travelling  on business;
	 	 
	"Technical Costs"	mean the  total  of technical  costs including  editing, subtitling, encoding,  duplication,  quality  control  and labelling  costs;
	 	 
	"Term"	has the meaning  ascribed to it in Clause 3;
	 	 
	"Western Movies"	means featured films which is  shown  in  English  and selected European languages including Italian, French, German and Dutch, refer to programme specifications in Schedule 1; and
	 	 
	"Western Short Features"	means  short  features  programme which  is shown  in English, refer to programme specifications in Schedule 1.


 


		1.2	In this
Agreement, unless the context otherwise requires:-



 


		1.2.1	references to
Clauses and Schedules are to the clauses of and schedules
to this Agreement;



 


		1.2.2	Clause headings and the table of contents are for convenience only
and have no legal effect;



 


		1.2.3	references to
(or to a specified provision of) this Agreement
or any other document are to this Agreement,
that document or that provision
as in force for the
time being and
as amended, varied or supplemented
in accordance with its terms;



 


		1.2.4	references
to (or to a specified
provision of) any Ordinance
or enactment are to that Ordinance or enactment or that
provision as amended,
modified, extended, re-enacted,
consolidated or replaced
and in force for the
time being;



 




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		1.2.5	words importing the singular
include the plural and vice versa;



 


		1.2.6	words importing one gender include any other gender;



 


		1.2.7	references to persons includes bodies corporate, firms
or unincorporated associations; and



 


		1.2.8	the Schedule(s)
form(s) part of this Agreement
and references to this
Agreement include the Schedule(s).



 


		2.	PROVISION OF SERVICES



 


		2.1	IFP agrees to
continue to provide the Services and the
Airline hereby agrees to accept the
provision of such Services
from IFP, on and subject to the terms set out in this
Agreement.



 


		2.2	The Parties hereby agree
that as consideration for the provision of such Services
by IFP, the Airline shall pay for such Services in the
manner provided for in Clause 6.



 


		3.	TERM



 


		3.1	The parties acknowledge that
IFP have been providing the Services to the Airline since the Effective Date,
and this Agreement shall be deemed to have commenced as
of the Effective Date (April on board cycle) and shall continue to be in force until 31st December 2009 (December on board
cycle) ('Initial Term), unless either Party terminates this Agreement
in accordance with Clause 16 or until such
date as the Parties otherwise agree
in writing (the "Term").






 


		4.	IFP'S OBLIGATIONS



 


		4.1	Account Servicing



 


		4.1.1	IFP warrants that all Personnel
involved in the performance of the Services will be
of high caliber and suitably skilled and experienced to
perform properly the tasks assigned to them. IFP must provide dedicated account management
available to deal with all operational
and financial issues and available at time
zone permissible hours to deal with
requests made by the Airline.



 


		4.2	For Audio Programming:



 


		4.2.1	Programming



 


		(a)	IFP shall supply the Airline with
a varied selection of Audio
Programmes as specified in
SCHEDULE 1 - PROGRAMME SPECIFICATIONS for each agreed Exhibition Period.



 


		(b)	IFP shall
be responsible for suggesting a selection of
Audio Programmes to match the Airline's
demographics issued to IFP from
time to time and the guidelinedocument detailed in
SCHEDULE 2 - PROGRAMMING GUIDELINES for each agreed
Exhibition Period. The said
programming guidelines may be updated
from time to time upon mutual agreement of the Parties.



 


		(c)	IFP shall
ensure that each
Audio Programme is consistent throughout
and features songs
and artists, which are relevant
to the title of the
Radio Channel or the Music Album category.



 


		(d)	The Airline shall retain
the right to amend the number of Audio Programmes, Radio
Channels, Music Album categories, frequency
and general programme specification during
the period of the Agreement.
However, if
the current
specification changes
substantially then
the Parties agree to
review the Management
Fee.



 




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		4.2.2	Royalties and Presenters



 


		(a)	IFP will negotiate
all Presenter fees, and shall ensure that
all fees are competitive and favourable
to the Airline.



 


		(b)	IFP shall use
best endeavours to ensure that no Presenter
used on any of the Radio Channels
shall work in the same capacity
for a direct competitor
of the Airline without prior permission of the
Airline,
such permission not
to be unreasonably withheld.



 


		(c)	IFP shall
be responsible for clearing Mechanical
Royalties for the
Audio Programmes and
obtaining permission for it and/or
Airline to copy, duplicate,
store on IFE equipment,
record and use the Audio Programmes on
the Airlines' Aircraft as
anticipated hereunder including in respect
of all copyright works comprised in the
Audio Programmes including in all music, lyrics,
songs and sound recordings and for paying all
Mechanical Royalties
and other fees due to the
copyright owner or the relevant
royalty body in the
country where the
Programmes are produced
or as required. In the UK, the rights are held by PPL (Phonographic
Performance Ltd) representing
record companies and MCPS (Mechanical
Copyright Protection Society) representing
composers, authors and publishers. Mechanical Royalties
are also payable to equivalent agencies
in locations where
the Programme is produced outside the UK;



 


		(d)	IFP will advise the Airline in
advance of the Presenters
and Mechanical Royalties fees negotiated on the Airline's behalf.
IFP warrants that it
will use best endeavours
to negotiate favourable terms for
the Airline and will
provide the Airline with realistic indicative
pricing during the annual budget process for approval by
the Airline. IFP will not agree to
or commit to any Presenter
Fees or Mechanical Royalties that
are greater than
as stipulated in the
annual budget without Airlines' consent.



 


		(e)	IFP hereby warrants that
it will secure all rights required for
Airline to copy and
load Audio Programmes
onto its Aircraft and for the same
to be used in AOD format or otherwise and will be solely
liable for any
claims by any rights
holder in any territory.



 


		4.2.3	Technical &
Logistics



 


		(a)	Editing



 


		i)	IFP shall
be responsible for editing Audio
in accordance with the requirements of the Airline. Editing will
generally involve IFP editing the Audio Programme to combine
and mix music and speech content to the
agreed duration, to include
advertisements and other materials as
requested by the Airline
and to remove any material detailed
in SCHEDULE 2 PROGRAMMING GUIDELINES.



 


		ii)	IFP shall indemnify
the Airline for any loss or
damage arising or suffered
due to errors or negligence
in terms of
editing, such as incorrect Stings or incorrectly placed advertisements.
The total of such liability shall be
limited to the total cost of
Duplication and editing
for the particular Programme(s) in
question. IFP
will not be liable
under this clause if the error
or negligence is the result of another
third party.



 


		(b)	Duplication and
Encoding



 


		i)	IFP shall arrange Duplication of all Audio Programmes
in CD format,
Encoding of the Programme in Digital
Media format and/or
Duplication of the
Boarding Music in Flashcard format according to specifications
required by the Airline.



 


		ii)	IFP will use
best endeavours to recycle Boarding
Music Flashcards where
possible.



 






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		iii)	IFP warrants
that all Duplication
and Encoding of Audio Programmes shall be
to the technical
standard specified
by the manufacturers
of the IFE equipment selected
for installation by the
Airline on its Aircraft and shall
otherwise be undertaken to best industry standards. The
technical standard
and format of the CDs, Digital
Media and Flashcards supplied to the
Airline shall comply with the technical
requirements of the Airlines' equipment and any other
technical requirements specified by the
Airlines'
designated engineersor
representatives and shall otherwise
be of merchantable quality and
fit for purpose.



 


		(c)	Quality Control and Labelling



 


		i)	IFP shall be
responsible for all quality
control and labelling
of all CDs in accordance
with the label list issued
by the Airline. IFP acknowledges that quality control and
correct labelling is of the utmost
importance and IFP shall be
responsible for loss and
damage suffered by
the Airline due to incorrect
labelling or poor quality control procedures. Should there
be any mistakes in
labelling or quality
control, IFP will be
responsible for
rectifying the situation at their
own cost.



 


		(d)	Delivery



 


		i)	IFP shall arrange for the
delivery of the required
number of
CDs, the Digital Media and the Flashcards containing
the Audio Programmes for each
Exhibition Period to the delivery addresses set
out in SCHEDULE 3 -CONTACT AND DELIVERY or
such address as is otherwise specified by the Airline no later than
the date of the agreed monthly timeline
prior to the commencement
of each Exhibition Period.



 


		ii)	Time of delivery shall
be of the essence.
In case of late delivery Airline may
at its discretion choose
to accept a payment equal to the total value
of all the Programming Costs and
Technical Costs arising under this Agreement for that particular
month or such pro-rata payment
as the parties shall agree,
as full compensation
for such late delivery.



 


		4.3	For Video
Programming (Western
Movies and Western Short Features):



 


		4.3.1	Programming



 


		(a)	IFP shall supply the
Airline with a varied selection of Western Movies and Western
Short Features Programmes as specified
in SCHEDULE 1 - PROGRAMME SPECIFICATIONS for
each agreed Exhibition
Period.



 


		(b)	IFP shall be
responsible for suggesting a selection
of Western Movies and Western
Short Features Programmes to match
the Airline's demographics
issued to IFP from time to time and the guideline document
detailed in SCHEDULE 2 - PROGRAMMING GUIDELINES for
each agreed Exhibition
Period. The said programming
guidelines may be updated from time
to time upon mutual agreement of the Parties.



 


		(c)	The Airline shall retain
the right to amend the number
of Western Movies and Western Short Features Programmes,
channels, frequency and general programme specification
during the period of the
Agreement. However, if the current
specification changes substantially then the Parties agree
to review the Management Fee.



 


		4.3.2	Licensing



 


		(a)	IFP will negotiate License Fees
with Distributors
based on the Exhibitions
and commitments agreed
with the Airline during the annual budget
process.



 






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		(b)	IFP shall obtain Licenses
for the Western Movies and Western Short Features Programmes from Distributors, subject to
the rights held by each Distributor. Such License shall
set forth the Western
Movies and Western Short Features Programme title, Exhibition
Period and the length
(in number of minutes) of
the Programme.



 


		(c)	IFP will advise
the Airline in advance of any
License Fee and any
other fees payable for exhibition of the
Western Movies and Western Short Features Programmes negotiated
on the Airline's behalf, where such License Fees may exceed the amount agreed in the annual
budget. IFP warrants that
it will use best endeavours
to negotiate favourable terms
for the Airline and will provide the Airline with
realistic indicative pricing during the annual budget process for approval by the Airline.
IFP will not agree or commit to any
Licence Fees or other fees that
are greater than as stipulated in the budget,
without Airlines' consent.



 


		(d)	At the request of the Airline, IFP will license
Western Movies and Western Short Features Programmes, in dual language format whether
dubbed or subtitled. Any additional costs will be agreed
in advance with the Airline during
the annual budget process.



 


		(e)	If a language, whether
dubbed or subtitled, is
created specifically for the
Airline, dependant on the revenue of the booking to the
Distributor, the Airline may have to bear
the Technical Costs of the
relevant Programme, for example,
the encoding of language.
IFP will advise the cost
in writing to the
Airline for approval prior to the
booking being placed in the event that the costs are outside
the scope of the budget.



 


		4.3.3	Technical & Logistics



 


		(a)	Following approval of the
Western Movies and Western Short
Features Programmes as detailed in Clause
10,



 


		i)	IFP shall arrange Duplication
of the relevant Programmes in cassette
format (VHS, V8 or
Hi-8) according to
the tape quantity required
by the Airline; and/or



 


		ii)	IFP shall arrange
Encoding of the relevant Programmes
in Digital Media according
to the standard required
by the Airline, IFP shall
ensure that all such Duplication
and Encoding is permitted under the relevant Licences.



 


		(b)	Editing



 


		i)	IFP shall be responsible for
arranging of Editing all Western
Movies and Western Short Features
Programmes according to the requirements of
the Airline. Editing will generally involve
the Distributor's designated laboratories in Hollywood
or IFP editing the
Programme to include advertisements,
the Airline's logos,
channel Stings, warning boards, and
other materials as
requested by the Airline
and removing sensitive scenes as outlined in the
guidelines detailed in
SCHEDULE 2- PROGRAMMING GUIDELINES. -



 


		ii)	IFP shall indemnify the Airline for
any loss or damage arising
or suffered due to errors or negligence in terms of editing,
such as incorrect Stings or incorrectly
placed advertisements.
The total of such liability
shall be limited to the
total cost of Duplication and editing for
the particular Programme(s) in question. IFP will not be
liable under this clause if the
error or negligence is the result of another third party.



 


		(c)	Subtitling



 


		i)	IFP shall
arrange subtitling
of all Western Movies
and Western
Short Features
Programmes where
required
by the Airline.



 






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		(d)	Duplication and Encoding



 


		i)	IFP warrants that
all Duplication and Encoding
of all Western Movies and
Western Short
Features Programmes shall
be to the technical
standard specified
by the manufacturers of
the IFE equipment selected for
installation by the Airline on its Aircraft
and shall otherwise be undertaken to best industry standards.
The technical
standard and format of the cassette and the Digital Media supplied to the Airline shall comply
with the technical requirements
of the Airlines' equipment and any
other technical
requirements specified
by the Airlines' designated
engineers or representatives
and shall otherwise
be of merchantable quality fit for purpose.



 


		ii)	IFP shall be
responsible for the Encoding of advertisements and shall be
required to coordinate with the Airline's nominated
Business Partners in order to ensure that
the advertisements are encoded correctly and according
to the timelines
agreed between the
Parties.



 


		(e)	Quality Control and
Labelling



 


		i)	IFP shall be responsible for all
quality control and the labelling of all Western Movies and Western Short Features
Programmes in accordance with
the label list issued by
the Airline.



 


		ii)	IFP acknowledge that quality
control and correct labelling is of
the utmost importance
and IFP shall be responsible
for loss and damage suffered
by the Airline due to incorrect
labelling or
poor quality control procedures, unless due to reasons
attributable
to the Airline.



 


		iii)	Should
there be any mistakes
in labelling or quality
control, IFP will be responsible for rectifying the situation
at their own cost.



 


		(f)	Delivery



 


		i)	IFP shall arrange
for the delivery of
the required number
of cassettes and the
Digital Media containing
the Western
Movies and Western
Short Features Programmes for each Exhibition
Period to the address
set out in SCHEDULE
3 - CONTACT AND DELIVERY or such other address as is
otherwise specified by Airline no later
than the date of the
agreed monthly
timeline prior to the commencement
of each Exhibition Period.



 


		ii)	Time of delivery
shall be of the essence.
In case of late
delivery Airline may
at its discretion choose
to accept a payment equal to
the total value of the License
Fees and Technical
Costs arising under this
Agreement for that particular month or such
pro-rata payment as
the parties shall agree, as full compensation for such
late delivery.



 


		(g)	Tape Destruction for
Western Movies



 


		i)	IFP shall be
responsible for the destruction
and degaussing of all
Western Movie Programme cassettes returned
by the Airline
to IFP or IFP's nominated
subcontractor.



 


		ii)	IFP warrants that
it is solely liable for
the performance of
any sub-contractor appointed to perform this activity and that any sub-contractor used will follow
the guidelines set out by
the Distributors and the
MPAA when destroying
and degaussing the
cassettes.



 


		4.4	Third Parties



 


		4.4.1	IFP shall
as required by Airline supply the Airlines' nominated
Business Partners with full details of the
Programmes, including
photographs, inclusion in the Airlines'
inflight entertainment guides, the Interactive
Screens of the IFE system, onboard advertising and the Airlines'
websites in accordance with a timetable to be agreed by the
Parties from
time to time.



 






    	CX and KA Western Programming Agreement - IFP Final 26 Jun 08	Page 12 of 57



    	 



    

 


		4.4.2	IFP will provide or contract with
strategic third parties
in order to provide the equipment, materials, technology,
software, goods and personnel which are required by IFP to
ensure that it fulfills
its obligations hereunder.



 


		4.4.3	IFP warrants that when contracting
with third parties such as Distributors
and Presenters, commitments made in any agreements with
such parties shall not exceed the
commitments including timelines agreed with the
Airline. The Airline will not be liable for any liabilities
arising or
incurred by IFP relating
to IFP contracting with third parties beyond the parameters
agreed with and scope
of authority provided by Airline.



 


		4.5	IFP hereby undertakes with the Airline that
it shall at
all times
during the continuance of this
Agreement:-



 


		4.5.1	provide the Services in
accordance with the terms of
this Agreement, to the highest
business standards, and in an
efficient and competent manner with due and professional skill and care;



 


		4.5.2	comply with all applicable
laws, ordinances, regulations and relevant
standards in the performance of the Services;



 


		4.5.3	all physical items and media supplied hereunder including
COs, cassettes and the like will
be provided to specification and will be
of merchantable quality and fit for purpose.



 


		4.6	In the event that IFP fails to provide the
Services or the Services
do not conform to the standards or specifications
set out in this Agreement, the Airline, without prejudice
to any other right it may have, shall be entitled to:-



 


		4.6.1	request IFP to,
at the cost and expense of FP, to redeliver any Services
which are deficient or non-conforming;



 


		4.6.2	request that
IFP carry out relevant repairs or rectification
of the relevant
Services at such place as reasonably requested by
the Airline;



 


		4.6.3	carry out the repairs
or rectification of
the relevant Services
itself or by
others and hold IFP accountable therefor;
and/or



 


		4.6.4	withhold all or part of the payment of the Service Costs until the
Services in question are satisfactorily provided or corrected or where the
Service Costs have been paid,
request IFP to refund the Service
Costs on a pro rata basis in respect of the
Services in question.



 


		4.7	Upon notification by the Airline under Clause 4.6 of
                                                                                                                                                       any deficiency in or non- compliance
                                                                                                                                                       of the Services, IFP shall promptly take such action as may be
                                                                                                                                                       required by the Airline pursuant to Clause 4.6.



 


		4.8	In the event that in the Airline's opinion,
IFP has failed to
satisfactorily carry out the actions specified in any of Clauses
4.6.1 to 4.6.4 as required by the Airline,
the Airline shall be entitled to: -



 


		4.8.1	refuse to accept any Services or any
                                                                                                     further performance of IFP without liability;



 


		4.8.2	engage any person to provide
the Services and require IFP
to bear the full cost thereof; and/or



 


		4.8.3	terminate this Agreement
and treat itself as discharged by IFP's breach.



 


		5.	AIRLINE OBLIGATION



 


		5.1	Programming



 


		5.1.1	In the event that the Airline
procures programmes through
sources other
adherence to technical specification, copyrights and all other associated exhibition rights
and fees in
relation to such programmes.



 






    	CX and KA Western Programming Agreement - IFP Final 26 Jun 08	Page 13 of 57



    	 



    

 


		5.2	Information



 


		5.2.1	The Airline will provide details of
                                                                                                     the BOP by no later than October each year of this
                                                                                                     Agreement in order for IFP
                                                                                                     to calculate the required flight levels
                                                                                                     for movie License Fees
                                                                                                     and the required quantities
                                                                                                     of Cassettes, CDs, Intermasters and Flashcards for the
                                                                                                     following year's budget.



 


		5.2.2	The Airline
will at times to be agreed advise IFP of the required quantity
and format of the cassettes, CDs, Flashcards, Digital Media
for each Exhibition Period.



 


		5.2.3	The Airline shall agree to keep
IFP informed as to the technical specification of equipment
installed on each Aircraft, and the relevant specification for each applicable IFE system. The
Airline shall give IFP notice of any
change or addition in specification in accordance with
the monthly timeline.



 


		5.2.4	The Airline shall
agree to provide updated retrofit
plans, demographics and available survey results to IFP;
however, IFP must proactively request information of
this nature in order to
provide the Services.



 


		5.2.5	The Airline shall notify
IFP of the labelling requirements and packaging requirements
in preparation for shipment.



 


		5.3	Advertising &
Promotional Material



 


		5.3.1	The Airline or its
appointed agents shall
supply written details
to IFP of any sponsorship,
advertising, airline logos etc
to be included in the
Programmes in accordance
with the monthly timeline. Such details shall
include the name of each sponsor or advertiser, the duration
of the advertisement and any special instructions pertaining
to the placing
of the advertisement.



 


		5.3.2	The Airline
or its appointed agents
shall arrange for
the delivery to IFP of the advertisements
required for insertion
in accordance with the monthly timeline.
Such advertisements shall
normally be delivered on Betacam
SP together with a review copy on VHS.



 


		5.3.3	In the event
that the Airline chooses to use
promotional material
of the Programmes, it must
use the promotional
material supplied
by the Distributors
and comply with all written instructions supplied with
such promotional material.
The Airline agrees not to modify such
material in any way
and to use the promotional material solely
for the Airline's inflight entertainment
guides, the Interactive Screens
of the IFE system, onboard
advertising and the
Airlines' websites.
It is the responsibility of the Airline to obtain permission for any other use of the
promotional materials of the Programmes.



 


		5.4	Video Cassettes, CDs and Digital Media



 


		5.4.1	The Airline shall use
its reasonable endeavours to ensure
that the video cassettes, CDs or Digital Media incorporating
Programmes remain in
Cathay's or Dragonair's possession
and control (as the case may be) for the authorised Exhibition
Period.



 


		5.4.2	The Airline will use reasonable
endeavours to prevent damage to or loss,
theft, conversion or destruction of any cassette,
CDs or Digital Media incorporating the Programmes. The
Airline will notify
IFP in writing of any such damage, theft, loss
conversion or destruction and will
cooperate with IFP and or the
Distributor
in any reasonable attempt
to recover
such cassettes,
CDs or Digital Media.



 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 14 of 57



    	 



    

 


		5.4.3	The Airline shall undertake not to duplicate,
copy, edit, exhibit,
promote or sell any of
the cassettes, CDs or Digital Media other than
the permitted use of the Programmes
on flights operated by
the Airline and excepting
material that is the property of the
Airline.



 


		5.4.4	At the conclusion of the
agreed Exhibition Period for a Programme,
the Airline shall within forty
five (45) days
of the end of the Exhibition Period;



 


		(a)	Return the movie cassettes to
the address detailed in
SCHEDULE 3 - CONTACT AND DELIVERY for IFP to arrange destruction
of the cassettes; and



 


		(b)	erase all Digital Media
from the Aircraft's digital servers.



 


		5.5	Music Royalties
Licenses



 


		5.5.1	The Airline shall make
all necessary payments for any and all rights,
Licenses and other clearances
for the performance of music
contained in the soundtrack
of the Programmes or advertisement
that may be applicable by Public Performance Rights regulations
in the Airlines' country
of registration.



 


		6.	SERVICE COSTS



 


		6.1	In consideration of the Services
to be rendered by IFP under
this Agreement, the Airline shall pay to IFP the fees specified
below (the "Service
Costs"). The detailed budget is included in
SCHEDULE 4- BUDGET FOR 2007



 


		6.2	For Audio Programming



 


		6.2.1	Management Fee



 


		(a)	The annual
Management Fee for Audio has
been agreed by the parties and will be reviewed annually
pursuant to Clause 11 or as otherwise agreed by
the parties and will
be paid in equal installments
on a monthly basis.
The Management Fee comprises a labour cost, overhead cost
and a profit margin
and these costs will be taken into account in fixing any
adjustment to the
Management Fee.



 


		(b)	Labour Cost:



 


		i)	should include costs
of in-house labour
working directly on
the Airlines' account, for example, Personnel
involved in account servicing, programming, logistics support,
etc. Labour costs related
to technical processes,
such as editing, Encoding,
Duplication, quality
control and labelling should not
be included in any assessment of labour costs for
the purposes of assessing
the Management Fee;



 


		ii)	should reflect actual
salary cost and include all staff benefits,
insurance, pension, healthcare, tax, and
other benefits; and



 


		iii)	will be calculated
based on the estimated man-days required and man-day
rates of each of IFP's Personnel
involved in the provision
of the Services.



 


		(c)	Overhead Cost:



 


		i)	should include all non-labour
related operating costs, including
rent, rates, labour
cost related to support services
such as finance, I.T., and other
like costs required for the provision of
the Services. Overhead
costs related to technical processes
should not be included and they
should be covered by the rates of technical
services; and



 


		ii)	should be
presented as a percentage of the labour cost,
namely, ***
for this Agreement.



   





   






 ***
 Confidential treatment requested. 


 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 15 of 57



    	 



    

 


		(d)	Profit Margin:



 


		i)	should be calculated as a percentage
of total of the labour
cost and overhead cost, namely, ***
for this Agreement.]



 


		(e)	The agreed annual Management Fee for Audio is fixed and firm for the
duration of this Agreement, unless agreed
otherwise between the parties taking into account any adjustment in labour costs and
overhead costs.



 


		6.2.2	Programming Cost



 


		(a)	Programming Cost shall include
the hourly rates for
programming in a studio and using a computer
edit facility, but does not include the
cost of the producers.



 


		(b)	Programming Cost shall be
agreed during the annual budget meetings and
will be discussed on a Programme
by Programme basis showing a detailed breakdown of the
hours spent using studio
and computer for each
Audio Programme. It
will also include the Programming Costs related to AOD
Music Albums and Boarding Music.



 


		(c)	The agreed
rate for programming in studio is
*** for Radio Channels produced in
Hong Kong, *** for Radio Channels produced in Singapore
and *** for Radio Channels
produced in London and Los Angeles. The agreed
rate for programming using
a computer edit facility
is ***.



 


		6.2.3	Presenter Cost



 


		(a)	IFP will use best endeavours to
provide competitive prices for costs of Presenters and will ensure that
such costs charged to the Airline shall
not exceed those agreed between the Parties
during the annual budget review process.



 


		(b)	Presenter costs will be
charged to the Airline at cost with no
mark up or commission whatsoever and will be
subject to review on an annual basis.



 


		6.2.4	Mechanical Royalties



 


		(a)	IFP shall
be responsible for using
best efforts to understand
the relevant royalty laws and negotiating
favourable Mechanical Royalties
on behalf of the Airline.
The current agreement is
*** of the cost related to music
production (Management Fee and
Programming Cost), CD Duplication and Encoding.



 


		(b)	Mechanical Royalties will
be charged to the Airline at
cost with no mark up.



 


		6.2.5	Technical Costs



 


		(a)	All Technical Costs of whatever
nature will be charged to the Airline at cost, with no
additional mark up or commission.
All Technical Costs will
be subject to review
on an annual basis
and shall not exceed costs stipulated in the
annual budget unless agreed by Airline.



 


		(b)	Duplication Cost



 


		i)	For Cathay,
6 CDs are used to contain the
22 Radio Channels and the agreed
unit cost is ***. Intermasters are
used for the Duplication of the Radio
Channels and the agreed unit cost
is ***. Flashcards are
used for the Duplication of Boarding Music and the
agreed unit cost is***.



 


		ii)	For Dragonair, 4 CDs are
used to
contain 16 Radio Channels and the agreed unit cost is ***
per CD. Intermasters
are used for the Duplication of
the Radio Channels and the agreed unit
cost is ***.
Flashcards and
Cassettes
are used
for the Duplication
of Boarding Music
and the agreed
unit cost
is *** for Flashcard
and *** for cassette.



 





 






*** Confidential treatment requested.


 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 16 of 57



    	 



    

 


		iii)	Costs relating to Duplication
includes costs for quality checking/labelling and all associated
Duplication costs.



 


		iv)	Duplication costs charged to the
Airline will remain fixed and
firm for the duration
of this Agreement unless subject to a decrease due
to efficiencies in
working practice. Duplication costs may not exceed the costs stipulated for Duplication in the annual budget unless agreed by Airline.



 


		(c)	Encoding Cost
for Cathay



 


		i)	The agreed encoding rate
is *** per minute for encoding
of Radio Channels, *** per minute for encoding of Boarding
Music in Flashcard for Panasonic System, and
*** per minute for encoding
of Boarding Music in CD Rom
for KID System.



 


		ii)	The Cost of Encoding includes costs
for quality checking and
all associated Encoding costs.



 


		iii)	Encoding costs charged to the
Airline will remain fixed and firm for
the duration of this Agreement unless subject to a decrease
due to efficiencies in working practice.
Encoding costs may not exceed the costs
stipulated for Encoding in the annual budget unless agreed
by the Airline.



 


		6.3	For Video
Programming



 


		6.3.1	Management Fee



 


		(a)	The
annual Management Fee for video
Programmes has been agreed by the parties and will be reviewed annually
pursuant to Clause 11 or as otherwise agreed
and will be paid
in equal instalments on a monthly basis. The
Management Fee comprises labour
cost, overhead cost and a profit
margin and these costs will
be taken into account
in fixing any adjustment
to the Management Fee.






 


		(b)	Labour Costs:



 


		i)	should
include costs of in-house
labour working directly on the Airline's account, for
example, Personnel involved in account servicing,
programming, logistics support, etc. Labour
costs related to technical processes,
such as editing, Encoding, Duplication, quality
control and labelling should not
be included in the
labour costs for the
purposes of assessing
the Management Fee;



 


		ii)	should reflect actual salary
cost and include all
staff benefits, insurance, pension,
healthcare, tax, and other benefits; and



 


		iii)	will be calculated to
each category, Western
Movies and Western
Short Features, based on the estimated
man-days required and
man-day rates of each of
IFP's Personnel involved in
the provision of the
Services for each category.



 


		(c)	Overhead Costs:



 


		i)	should include all non-labour
related operating costs, including rent, rates, labour
cost related to support
services such as finance,
I.T., and other like
costs required
for the provision of the Services. Overhead costs
related to technical processes
should not be included and
they should be covered
by the rates of technical services; and



 





 






*** Confidential treatment requested.




 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 17 of 57



    	 



    

 


		ii)	should
be presented as a
percentage of the
Labour Cost, namely/***
for this Agreement.



 


		(d)	Profit Margin:



 


		i)	should
be calculated as a
percentage of total
of the labour cost
and overhead
cost namely, ***
for this Agreement.



 


		(e)	The agreed annual Management Fee for video
is fixed and firm
for the duration of this Agreement, unless agreed otherwise
between the parties, taking into account any adjustment in labour costs and overhead
costs.



 


		6.3.2	License Fees



 


		(a)	In all circumstances,
IFP will use best endeavours
to negotiate favourable and continuously improving
rates and terms with Distributors and will
pass on any reduction in price to the Airline. IFP will
on request provide the Airline the details of terms
negotiated with Distributors including
copies of relevant agreements.



 


		(b)	The Parties will jointly agree
the necessary commitments to be made with individual Distributors.



 


		(c)	License Fees will be charged to
the Airline at cost with no mark up
or commission whatsoever and will be subject to review
on an annual basis.



 


		6.3.3	Technical Costs



 


		(a)	All Technical Costs of
whatever nature will be charged to
the Airline at cost,
with no additional mark up or commission. All Technical Costs will be
subject to review on an annual basis and
shall not exceed the
costs stipulated in the annual budget unless otherwise
agreed.



 


		(b)	In the event that the same programme is used
for both Cathay
and Dragonair, the Technical Costs should be equally shared
between Cathay and Dragonair.



 


		(c)	Master Cost



 


		i)	For Western Movies, the
master costs are included in the cost of
License Fees;



 


		ii)	For Western Short
Features, the master
cost is charged by
the Distributors and
the budgeted master cost is
*** for 30-minute Programmes and *** for
60-minute Programmes.
IFP will ensure that
the Master costs charged to
the Airline shall not exceed
those agreed between
the Parties during
the annual budget review process. Any increase in budgeted costs must be
agreed in advance by Airline.



 


		(d)	Insertion Fee for Western
Movie Programmes



 


		i)	The insertion fee refers to the
cost to insert advertisements,
channel Stings, and
warning boards into the Programmes.



 


		ii)	IFP will use best endeavours
to provide competitive
prices for insertion
fees and will ensure
that the insertion fees charged
to the Airline shall not exceed
those agreed between
the Parties
during the
annual budget review process. The budgeted insertion fee
is *** per movie and
this may not be increased unless the Airline
provides approval in advance.



 





 






*** Confidential treatment requested.




 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 18 of 57



    	 



    

 


		(e)	Editing Cost
for Western Short Feature Programmes



 


		i)	The Editing refers
to the process to insert advertisements, channel stings,
warning boards to the Programmes and
removal of sensitive scenes from the Programmes.



 


		ii)	Editing Cost
is calculated based
on the hourly rates of ***,
the number of edit hours
required and the cost
of betacam SP tape for each
cassette length, as
agreed between the Parties during
the annual budget
review process. The agreed unit editing
cost is *** for
135-minute programme
and *** for 60-min programme
and *** for 60-minute
programme
shown on AVOD system
only.



 


		iii)	The hourly rates of ***
for Editing will remain fixed
and firm for the duration of this Agreement unless subject
to a decrease due to efficiencies in working practice.



 


		iv)	Editing costs
may not exceed the costs stipulated in the annual budget
unless agreed by the
parties.



 


		(f)	Subtitling Cost



 


		i)	IFP will
use best endeavours to provide competitive prices for
subtitling costs and will ensure that the subtitling
cost charged to the
Airline shall not exceed those agreed between the Parties
during the annual budget review process. The budgeted
subtitling cost is ***
for 30-minute programme and *** for 50-
minute programme and these
may not be increased unless
the Airline provides approval in advance.



 


		(g)	Duplication Cost



 


		i)	Duplication for
Western Movies is performed by the
Distributor's designated
laboratories in Hollywood. IFP
will use best endeavours
to provide competitive
prices for Duplication and will
ensure that the Duplication
rates charged to the Airline shall not exceed those
agreed between the Parties during
the annual budget review process.
The lock-up cost and applicable
tax of *** will be
added to the Duplication cost. The budgeted
Duplication rates are:



 


	 	 	VHS Tape	 	V8 or Hi-8 Tape
	For Cathay:	 	 	 	 
	120-minute	 	***	 	***
	Kids Movies	 	***	 	***
	For Dragonair:	 	 	 	 
	120-minute	 	***	 	***
	Kids Movies	 	***	 	***



 


		ii)	Duplication for Western Short Features is performed by IFP.
The agreed duplication rates are:



 


	 	 	VHS Tape	 	V8 or Hi-8  Tape
	For Cathay:	 	 	 	 
	135-minute	 	***	 	***
	60-minute	 	***	 	***
	For Dragonair:	 	 	 	 
	130-minute	 	***	 	***
	80-minute	 	***	 	***
	60-minute	 	***	 	***
	30-minute	 	***	 	***



 


	 	iii)	Duplication cost charged to the Airline will
remain fixed and firm for the duration of this Agreement unless subject
to a decrease due to
efficiencies in working practice. For the
avoidance of doubt
Duplication costs may not exceed the costs stipulated for
Duplication in the annual budget unless
agreed in advance by
Airline.



 





 






*** Confidential treatment requested.




 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 19 of 57



    	 



    




 


		(h)	Encoding Cost



 


		i)	Encoding for
Western Movies is performed by
the Distributor's designated laboratories in Hollywood. IFP
will use best endeavours
to provide competitive prices for Encoding and
will ensure that the
Encoding rates charged to the Airline shall not exceed
those agreed between the Parties during the annual
budget review process. The budgeted Encoding
rate is *** for recall
fee, *** per minute for
single language, ***
per minute for dual language,
*** per minute for adding a second language
to a recall file and
*** for cost of encryption and output.



 


		ii)	Encoding for Western Short
Features and advertisements is performed
by IFP. The agreed encoding
rate is *** per minute for
single language and dual language. Encoding
Cost charged to the
Airline will remain
fixed and firm for the duration of this Agreement unless subject to a decrease
due to efficiencies in working practice.



 


		iii)	If the Digital Media
of a Western Movie is
available in IFP's
library, IFP will offer
the Airline a recall rate of
*** per minute.



 


		iv)	For the avoidance of doubt Encoding costs
may not exceed the costs stipulated for
Encoding in the annual
budget unless agreed
in advance by Airline.



 


		(i)	Cost of
Quality Control, Labelling and Destruction



 


		i)	For Western
Movies, IFP will use best endeavours
to provide competitive prices for
quality control, la
belling and
destruction and will ensure that the
costs charged to the Airline shall
not exceed those agreed between the
Parties during the annual budget review
process. The agreed unit price per cassette
is ***.



 


		ii)	For Western Short
Features, the costs of Quality Control and Labelling are
covered by the Duplication Cost and Encoding Cost
while destruction of cassette is performed by
the Airline.



 


		6.4	Other Costs



 


		6.4.1	The cost
of providing all Services hereunder
(other than
as specified above as being the
subject of specific fees and charges) including
the cost of co- ordinating,
managing and sending promotional materials to the
relevant parties, for
the Interactive Screens will be covered by the Management
Fee for Audio and video.



 


		6.4.2	IFP will send
master cassettes and other material
to Hong Kong
or IFP's London office via
the Airline's designated courier
company, who will invoice
the Airline directly.



 


		6.4.3	If IFP incur costs over
budget in providing Services and such increase in
costs are not agreed
in advance by Airline,
then IFP shall be
responsible for such costs.



 


		7.	SHARING OF COST SAVING



 


		7.1	The Airline agrees to
share a portion of
the cost savings achieved
by IFP through the
negotiation of the License Fees for Western Movies and
Western Short Features as an incentive to
IFP to optimize License Fees in favour of
the Airline.



 





 






*** Confidential treatment requested.




 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 20 of 57



    	 



    

 


		7.2	For Western Movies:



 


		7.2.1	For the period of ***



 


		    (a)	The saving in License Fees has been calculated based on rates proposed
in the IFP response to the RFP minus the actual spend on License Fees (excluding the deal with ***);
and



 


		    (b)	The Airline has shared with ***
of the saving achieved which was ***.



 


		7.2.2	For the year of ***



 


		    (a)	The saving in License Fees shall be calculated based on a target
reduction of *** (or another amount to be mutually agreed) from the rates agreed in the annual
budget minus the actual spend on License Fees; and



 


		    (b)	The Airline will share with IFP ***
of the saving achieved or *** whichever is lower provided that the IFP scores an average of
***
or higher on the Key Performance Indicators during the two Performance Reviews per year.



 


		7.3	For Western Short Features:



 


		7.3.1	For the period of ***



 


		    (a)	The saving in License Fees has been calculated based on rates proposed in the IFP response to the
RFP minus the actual spend on License Fees (excluding the deal with ***); and



 


		    (b)	The Airline has shared with IFP ***
of the saving achieved which was ***.



 


		7.3.2	For the year of ***



 


		    (a)	The saving in License Fees shall be calculated based on a target
reduction of *** (or another amount to be mutually agreed) from the rates agreed in the annual
budget minus the actual spend on License Fees; and



 


		    (b)	The Airline will share with IFP ***
of the saving achieved or *** whichever is lower provided that the IFP scores an average of
*** or higher on the Key Performance Indicators during the two Performance Reviews per year.



 


		8.	PAYMENT SCHEDULE, INVOICING AND REPORTING



 


		8.1	IFP shall issue invoices in US Dollar or UK Pounds to the Airline the month prior to the Exhibition
Period concerned, i.e. the invoice will be received by the Airline on the 1st day of the month prior to the Exhibition Period in
question. For example, the Airline will receive invoices for January play cycle by 1st December.



 


		8.2	Encoding fees will be charged as per the budgeted amount using an average for each title based
on the number of languages required. A reconciliation against actual will take place on a quarterly basis and a credit or invoice
will be issued for the difference.



 


		8.3	Quotations for any additional requirements not detailed in the annual budget must be sent in advance
to the Manager Inflight Communication and Entertainment of the Airline for approval. Only expenses that have been pre-approved
by the Airline will be payable by the Airline.



 





 



*** Confidential
treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 21 of 57



    	 



    

 


		8.4	Amounts payable by the Airline under this Agreement shall absent dispute be paid in full within
forty five (45) days of the end of the month after the receipt by the Airline of the relevant invoice from IFP. All monthly invoices
from IFP shall be addressed for the attention of the Airline's Manager Inflight Communication and Entertainment.



 


		8.5	A summary report of the expenses will be provided to the Airline twice a year. The Parties
will agree the format for such report.



 


		8.6	If any withholding, deduction or retention is required by law to be made by the Airline in respect
of any payments made to IFP under this Agreement, IFP shall not be entitled to be paid or reimbursed the amount of such withholding,
deduction or retention or to be paid an extra amount to ensure that it receives the payment it would have received if such withholding,
deduction or retention were not made.



 


		9.	CANCELLATION



 


		9.1	The Airline may require IFP to change, reject, cancel or stop any and all bookings, or previously
agreed Programmes, and IFP shall in such circumstances take all possible steps to comply, provided that IFP can do so within its
contractual obligations to Distributors, and other suppliers, as such obligations have been entered into in accordance with the
authority provided by Airline. IFP shall be fully responsible for any liabilities or costs incurred due to IFP entering into contracts
with Distributors which provide for commitments greater than that agreed to by Airline. If Airline changes, cancels or stops any
previously agreed bookings, it will pay IFP reasonable costs of work completed to date relating to the bookings in question, based
on the terms of Clause 6. In the event of this occurrence, IFP will provide supporting documentation needed to determine
the amount of payment and will use best endeavours to mitigate the cost to the Airline. IFP shall not be entitled to any such payment
if Airlines' changed, cancelled or cessation of a booking is due to a breach by IFP on its obligation hereunder.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 22 of 57



    	 



    

 


		9.2	In the event that a Programme agreed to by the Parties as detailed in Clause 10 subsequently
becomes unavailable by the Distributor, then IFP will use best endeavours to ensure that any additional costs incurred by the Airline
from any third party or Business Partners as a result of such late change in a Programme title are covered by the Distributor.
Such costs may include but are not limited to costs related to integration, Interactive Screen changes, translation and will be
covered by the Distributor in terms of a credit payment or reduction in future licence fees from the Distributor in question.



 


		10.	APPROVALPROCESS



 


		10.1	IFP shall provide the Airline with a selection of recommendations for each Programme including
a synopsis of the content for video Programmes and a line up of proposed tracks and artists for audio Programmes according to the
monthly programming timeline.



 


		10.1.1	For Western Movie Programmes, it is approximately nine (9) weeks prior to the first day of the
scheduled Exhibition Period.



 


		10.1.2	For Western Short Feature Programmes, it is approximately fifteen (15) weeks prior to the first
day of the scheduled Exhibition Period.



 


		10.1.3	For Audio Programmes, it is approximately thirteen (13) weeks prior to the first day of the scheduled
Exhibition Period.



 


		10.2	The Airline shall confirm the Programmes to be produced or licensed according to the monthly programming
timeline.



 


		10.2.1	For Western Movie Programmes, it is approximately eight (8) weeks prior to the first day of the
scheduled Exhibition Period.



 


		10.2.2	For Western Short Feature Programmes, it is approximately fourteen (14) weeks prior to the first
day of the scheduled Exhibition Period.



 


		10.2.3	For Audio Programmes, it is approximately twelve (12) weeks prior to the first day of the scheduled
Exhibition Period.



 


		10.3	The following procedures should be followed for the approval
process:



 


		10.3.1	In the event of a notification by the Airline that any of the Programmes proposed in Clause
10.1 for approval are unsuitable for any reason and rejected by the Airline, IFP shall arrange for alternative Programmes to
be suggested for immediate consideration by the Airline.



 


		10.3.2	The process described in Clause 10.3.1 shall be repeated until such time as the Airline
has approved the suggested Programme line up for the Exhibition Period in question and such process shall be undertaken in accordance
with a timetable as may be agreed by the Parties. Once approved by the Airline, the Airline shall be liable for any additional
costs incurred by IFP in implementing any further changes or amendments to the Programme(s) as requested by the Airline.



 


		10.4	The Airline's written approval of the Programmes will be IFP's authority to proceed. The Airline
will endeavour to provide approvals within the time period detailed in Clause 10.2.



 


		10.5	Any reference in this Agreement to the Airline's written approval shall mean written approval by
representatives of the Airline who are authorised to approve IFP's work and whose names are set out below:



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 23 of 57



    	 



    

 


"Authorised Person"
of the Airline


 


Manager, Product


 


Manager Inflight Communication
& Entertainment


 


		10.6	Any reference in this Agreement to Airline's written approval regarding commercial and contractual
issues shall mean written approval by representatives of the Airline who are authorised to approve IFP's commercial and contractual
issues and whose names are set out below:



 


"Authorised Person"
of the Airline Manager


 


Purchasing, Marketing & Product Assistant


 


Purchasing Manager - Marketing


 


		10.7	Any change to the foregoing authorised persons during the term of this Agreement will be notified
in writing by the Airline to IFP.



 


		10.8	For the purposes of this Agreement "written approval" shall include approval signified
by:



 


		10.8.1	fax on the Airline's notepaper bearing the signature of an Authorised Person;






 


		10.8.2	oral approval given by an Authorised Person provided this is in circumstances where time does not
permit written approval and is subsequently supported by written confirmation within 24 hours; and



 


		10.8.3	e-mail emanating from the personal e-mail address of an Authorised Person.






 


		10.9	Where approvals or consents are required from Airline, Cathay has the authority to provide
                                                            the same on behalf of itself and Dragonair, and IFP shall only obtain such approvals or consents from Cathay
                                                            accordingly.



 


		10.10	Where an obligation is owed to IFP hereunder by Airline, such obligation shall be satisfied by
either Cathay or Dragonair performing or undertaking the obligation.



 


		11.	BUDGET PROCESS AND MEETINGS



 


		11.1	Budget Process



 


		11.1.1	In September every year the Parties will jointly determine the annual
costs for all aspects of the Services for the following year. 2007
Budget is included in SCHEDULE 4 - BUDGET FOR 2007



 


		11.1.2	IFP will be responsible for drafting the budget, and providing indicative pricing for annual costs
for all aspects of the Services.



 


		11.1.3	The Parties will jointly calculate the required number of Exhibitions, number of cassettes and
COs to be used for the following year's budget using the information provided by the Airline.



 


		11.2	Meetings



 


		11.2.1	Throughout the year, the Parties will be expected to meet on a regular basis in order to conduct
performance reviews, discuss strategy, analyse passenger feedback and survey results, decide themes and finalise budgets and commercial
issues.



 


		11.2.2	In order to conduct such meetings, if such meetings are to be held in Hong Kong, the Airline will
provide Sub-load Tickets to relevant IFP Personnel, as deemed necessary. The issuance of tickets will be at the sole discretion
of the Manager Inflight Communication and Entertainment of the Airline. At all times IFP's employees must adhere to the Airline's
Sub-load travel policy issued to IFP from time to time.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 24 of 57



    	 



    

 


		11.2..3	On a bi-annual basis (twice every year), the Parties will conduct a Performance Review whereby
the Airline will score IFP's performance against a set of predetermined Key Performance Indicators while IFP will give feedback
on the Airline's performance. The Key Performance Indicators and the Airline feedback form are detailed in SCHEDULE 5 -
KEY PERFORMANCE INDICATORS.



 


		12.	BUSINESS PARTNERS



 


		12.1	IFP shall co-operate fully with all the Airline's suppliers who have been appointed to provide
the Airline's IFE services. IFP shall endeavour to ensure that all aspects of the Services are correctly integrated where necessary
with other work, services, materials, processes and equipment supplied or operated by the Airline's Business Partners in fulfilment
of the Services and in meeting the deadlines laid down by the Airline or the Airline's Business Partners. The Airline will ensure
that its Business Partners who have been appointed to provide services that are relevant to this Agreement cooperate with IFP as
reasonably necessary for IFP to perform the Services under this Agreement.



 


		12.2.	IFP warrants that it will use best endeavours to work co-operatively with all nominated Business
Partners of the Airline to ensure that attention to detail, timelines, minimisation of additional costs and on time delivery are
ensured for the Services.



 


		13.	INTELLECTUAL PROPERTY RIGHTS



 


		13.1	The Airline retains all Intellectual Property Rights in all specifications, documents and reports
supplied to IFP by the Airline in connection with this Agreement and the Services.



 


		13.2.	IFP will be responsible for obtaining and warrants that it will obtain all copyright permissions
and Exhibition rights and all other similar rights and permissions relating to the Programmes required to enable the Airline to
use the Programmes on all Aircraft as anticipated hereunder, including all rights to duplicate, load and for passengers to use
such Programmes and associated copyright works and all charges, fees, or royalties chargeable for the exercise of the above rights
and liabilities shall be borne by FP.



 


		13.3	IFP further warrants that the Exhibitions of the Programmes (including any foreign language sound
track and/or subtitles) and reproduction or use of the Programmes will not infringe the copyright, performing rights, moral rights
or any other rights of any third party whatsoever and that the Programmes will not be obscene or defamatory.



 


		13.4	Ownership and all copyright and all other intellectual property rights in the Programmes shall
be retained at all times by the original Distributors, suppliers or copyright owners.



 


		13.5	All rights, title and interest in material, such as airline logos, fillers or advertisements which
are inserted in Programmes exclusively for the - Airline (including all Intellectual Property Rights therein) shall vest in and/or
remain the property of the Airline or the third party supplier of such material (as the case may be).



 


		13.6	For the purposes of this Clause, "Intellectual Property Rights" means patents, trademarks,
design rights (whether registrable or otherwise), applications for any of the foregoing, copyright, database rights, know-how,
trade or business names and other similar rights or obligations whether registrable or not in any country.



 


		13.7	The parties acknowledge that Airline will be responsible for paying any royalties due to Phonographic
Performance (South East Asia) Ltd and CASH in respect of Public Performance Rights and the performance of music and sound recordings
on Aircraft.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 25 of 57



    	 



    

 


		14.	INSURANCE



 


		14.1	Without limiting any obligation of IFP hereunder, it is agreed that IFP shall effect and maintain
at its own expense at all times for the duration of this Agreement the following policies of insurance:-



 


		14.1.1	Workers' Compensation and Employers' Liability
Insurance with a limit of liability of not less than ***
covering all claims and liabilities in respect of the death of or injury to any person employed by, or who is deemed to be a worker
of IFP or any sub-contractor of IFP in connection with the provision of the Services;



 


		14.1.2	Insurance covering general third party liability with a limit of
liability of not less than ***; and



 


		14.1.3	such other insurance as reasonably requested by the Airline in writing from time to time.



 


		14.2	IFP shall:-



 


		14.2.1	observe and perform all terms and conditions of such insurance and pay all deductibles;



 


		14.2.2	on request provide the Airline with the certificates or policies of the insurances, other details
of the insurance and evidence of currency and premium payment; and



 


		14.2.3	ensure that all insurance arranged by IFP are effected with reputable financially secure insurers
approved by the Airline and that all insurance is on terms acceptable to the Airline.



 


		14.3	If IFP fails to take out any of the insurance required under this Clause, the Airline may at its
sole discretion take out and maintain such insurances and deduct the costs from any moneys due to IFP or treat the failure to insure
as a material breach under this Agreement.



 


		15.	REPRESENTATIONS AND WARRANTIES



 


		15.1	Each Party represents and warrants to other Party as follows:-



 


		15.1.1	it is a company or corporation duly incorporated under the laws of the place of its incorporation
and has the corporate power and authority to accept the terms of this Agreement and to perform its obligations under it; and



 


		15.1.2	its entry into this Agreement has been duly and validly authorised and all requisite corporate
action has been taken in order to make such entry valid and binding upon it in accordance with the terms of this Agreement.



 


		16.	TERMINATION



 


		16.1	Either Party may terminate this Agreement by giving to the other
Party no less than *** notice in writing after the Initial Term.



 


		16.2	Either Party may terminate this Agreement with immediate effect by sending a written notice to
the other Party if:



 


		16.2.1	that other Party commits a material breach of its obligations under this Agreement and, in the
case of a breach capable of remedy as determined under Clause 16.3, such breach is not remedied within fourteen (14) days
of that other Party being specifically required to do so;



 


		16.2.2	a receiver, manager, administrator or like person takes possession or is appointed of the whole
or any part of the undertaking or property of that other Party;



 


 


 






*** Confidential
treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 26 of 57



    	 



    

 


		16.2.3	an order is made by a Court for the winding-up of that other Party or a resolution is passed by
the shareholders of that other Party for its winding-up, except for the purposes of amalgamation or reconstruction in such manner
that the resulting company is bound by and assumes the obligations imposed on that other Party by this Agreement;



 


		16.2.4	that other Party ceases to pay its debts or becomes unable to pay its debts;



 


		16.2.5	anything having a similar effect with any of the events referred to in Clauses 16.2.2 to 16.2.4
inclusive under the law of any jurisdiction occurs in relation to that other Party;



 


		16.2.6	that other Party disposes of the whole or any substantial part of its undertaking or assets; or



 


		16.2.7	that other Party ceases or threatens to cease to carry on all or any substantial part of its business.



 


		16.3	For the purposes of Clause 16.2.1, a breach shall be considered capable of remedy if the
Party in breach can comply with the provision in question in all respects to the sole satisfaction of the other Party, other than
as to the time of performance, provided that time of performance is not of the essence.



 


		16.4	The termination of this Agreement shall be without prejudice to any rights, obligations and liabilities
of any Party which have accrued at the time of termination.



 


		16.5	Upon any termination of this Agreement (howsoever occasioned), IFP shall forthwith deliver up to
the Airline all copies of any information and data supplied to IFP hereunder and shall certify to the Airline that no copies of
such information or data have been retained.



 


		17.	INDEMNITY BY IFP



 


		17.1	IFP shall indemnify on demand and hold harmless the Airline and its employees, directors, agents
and officers from and against any and all costs, damages, expenses, losses, claims or liability incurred by it (including all costs
and expenses which the Airline may incur in defending any proceedings) arising out of or in connection with (directly or indirectly)
this Agreement, including but not limited to:-



 


		17.1.1	any breach of any terms of this Agreement or the performance of the



Services by
IFP;


 


		17.1.2	any breach of any warranty or undertaking given by IFP or implied by applicable law in relation
to the Services or the provision of the Services;



 


		17.1.3	any negligent or wrongful act or omission of IFP or its employees, directors, agents or officers;



 


		17.1.4	any disputes, claims or proceedings brought by a third party alleging that the Services (or the
provision thereof) or the Programmes and/or associated materials provided by IFP hereunder or the copying or use thereof infringe
any patent, copyright, design right, trademark or other intellectual property rights of any other person; and/or



 


		17.1.5	any non-compliance of the Services with the specifications set out in SCHEDULE 1- PROGRAMME
SPECIFICATIONS.except to the extent that such costs, damages, expenses, losses, claims or liability are due to the gross negligence
or wilful misconduct of the Airline or its employees, directors, agents or officers.



 


		17.2	This indemnity shall survive termination of this Agreement.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 27 of 57



    	 



    

 


		18.	ENTIRE AGREEMENT



 


		18.1	This Agreement supersedes any agreements made or existing between the Parties before or simultaneously
with this Agreement in respect of the provision of services similar to the Services (all of which shall be deemed to have been
terminated by mutual consent with effect from the commencement date of this Agreement but without prejudice to the rights and liabilities
of the Parties accrued before such date), and constitutes the entire understanding between the Parties in relation to the subject
matter of this Agreement.



 


		19.	REMEDIES CUMULATIVE



 


		19.1	The rights of the Parties under this Agreement are cumulative and do not exclude or restrict any
other rights (except as otherwise provided in the Agreement).



 


		20.	NO WAIVER



 


		20.1	No delay or failure by either Party to exercise any of its powers, rights or remedies under this
Agreement shall operate as a waiver of them, nor shall any single or partial exercise of any such powers, rights or remedies preclude
any other or further exercise of them. No provision of this Agreement and no breach of any provision of this Agreement shall be
waived, altered or modified except by written instrument. No waiver of any breach shall affect or alter this Agreement, but each
and every provision of this Agreement shall continue in full force and effect with respect to any other breach then existing or
subsequent breach of any provision.



 


		21.	SEVERANCE



 


		21.1	If any provision of this Agreement is not or ceases to be legal, valid, binding and enforceable
under the law of any jurisdiction, neither the legality, validity, binding effect or enforceability of the remaining provisions
under that law nor the legality, validity, binding effect or enforceability of that provision under the law of any other jurisdiction
shall be affected.



 


		22.	AMENDMENT



 


		22.1	No amendment to this Agreement will be effective unless in writing and executed by all the Parties.



 


		23.	CONFIDENTIALITY



 


		23.1	Each Party shall treat as confidential all confidential
information obtained from the other pursuant to this Agreement and shall not divulge such information to any person (except to
such party's own employees and then only to those employees who need to know the same) and shall not use the information for any
purpose other than for which it was provided without the other Party's prior written consent. This clause shall not extend to
information (i) which was rightfully in the possession of such Party prior to the commencement of negotiations leading to this
Agreement, (ii) which is already public knowledge or becomes so at a future date (otherwise than in breach of this clause), (iii)
which is trivial or obvious, (iv) which is required to be disclosed to comply with any court order or stock exchange requirement,
or (v) where disclosure is required by law. Each Party shall ensure that its employees are aware of and comply with the provisions
of this clause. If IFP appoints any sub-contractor then IFP may disclose confidential information to such subcontractors, subject
to Airline's prior consent, which shall not be unreasonably withheld, and such sub-contractors or assignees agreeing to the same
confidentiality terms as contained herein.



 


		23.2	The provisions of this Clause 23 shall survive
the expiration or termination of this Agreement.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 28 of 57



    	 



    

 


		23.3	In particular during and after termination of this Agreement IFP acknowledges its responsibility
to treat in complete confidence all the demographic, marketing and sales information and statistics relating to the Airlines' business
which Airline may supply IFP in the course of this Agreement.



 


		24.	ADVERTISING



 


		24.1	Neither IFP or its affiliates nor any of its employees, agents or subcontractors shall mention
the name of the Airline in any advertisement, public relations exercise or promotional material relating to or arising out of this
Agreement without the prior written permission of the Airline. Such permission shall not be unreasonably withheld.



 


		25.	ASSIGNMENT



 


		25.1	No Party may assign or subcontract any of the rights or obligations of that Party under this
                                                            Agreement without the prior written consent of other Party to this Agreement. Such consents shall not be unreasonably
                                                            conditioned, withheld or delayed except that the Airline may assign or sub-contract the whole or any part of its rights or
                                                            obligations to any of its subsidiaries or affiliates.



 


		25.2	In the event of the Airline consenting to any sub-contracting of the whole or any part of this
Agreement, IFP undertakes and warrants to the Airline as follows:



 


		25.2.1	that any agreement between IFP and such a sub-contractor shall be in the same form as the relevant
parts of this Agreement and without limitation the agreement with a subcontractor shall include provisions regarding confidentiality
and liability for loss, termination, force majeure, damage, negligence and infringement to intellectual property rights where appropriate;



 


		25.2.2	that the sub-contractor shall comply with its obligations under such Agreement so as to ensure
that all the obligations of IFP under this Agreement are fully performed and IFP shall be responsible for all liabilities, acts
and omissions of any subcontractor; and



 


		25.2.3	that if it subcontracts any part of the Services, that its subcontractors shall be fully experienced,
properly qualified and properly organised, equipped and financed to undertake such subcontracted Services.



 


		25.3	If in the course of providing the Services during the Term of this Agreement IFP decides to use
the services of any company in which IFP has a material financial interest, IFP will declare this and before commissioning such
services obtain the consent of the Airline thereto.



 


		26.	EXPENSES



 


		26.1	Each of the Parties is responsible for that Party's own legal and other expenses incurred in the
negotiation, preparation and completion of this Agreement.



 


		27.	FORCE MAJEURE



 


		27.1	In this Agreement, "force majeure" shall mean any cause preventing a Party from
performing any or all of its obligations which arises from or is attributable to acts, events, omissions or accidents beyond the
reasonable control of the Party so prevented, including without limitation, strikes, lock-out or other industrial disputes (whether
involving the workforce of the Party so prevented or of any other Party), act of God, war, riot, civil commotion, malicious damage,
compliance with any law or governmental order, rule, regulation or direction, accident, breakdown of plant or machinery, fire,
flood, or storm.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 29 of 57



    	 



    

 


		27.2	If
                                                                                                                  a Party is prevented
                                                                                                                  or delayed in
                                                                                                                  the performance
                                                                                                                  of any of its
                                                                                                                  obligations
                                                                                                                  under this Agreement
                                                                                                                  by force majeure,
                                                                                                                  that Party shall
                                                                                                                  immediately
                                                                                                                  serve notice
                                                                                                                  in writing on
                                                                                                                  the other Party
                                                                                                                  specifying the
                                                                                                                  nature and extent
                                                                                                                  of the circumstances
                                                                                                                  giving rise
                                                                                                                  to force majeure,
                                                                                                                  and shall, subject
                                                                                                                  to service of
                                                                                                                  such notice
                                                                                                                  and to performance
                                                                                                                  of its obligation
                                                                                                                  under Clause
                                                                                                                  27.4, have
                                                                                                                  no liability
                                                                                                                  in respect of
                                                                                                                  the performance
                                                                                                                  of such of its
                                                                                                                  obligations
                                                                                                                  as are prevented
                                                                                                                  by the force
                                                                                                                  majeure events
                                                                                                                  during the continuation
                                                                                                                  of such events,
                                                                                                                  and for such
                                                                                                                  time after they
                                                                                                                  cease as is
                                                                                                                  necessary for
                                                                                                                  that Party,
                                                                                                                  using all reasonable
                                                                                                                  endeavours,
                                                                                                                  to recommence
                                                                                                                  its affected
                                                                                                                  operations in
                                                                                                                  order for it
                                                                                                                  to perform its
                                                                                                                  obligations.



 


		27.3	If
                                                                                                                                                                                          a
                                                                                                                                                                                          Party
                                                                                                                                                                                          is
                                                                                                                                                                                          prevented
                                                                                                                                                                                          from
                                                                                                                                                                                          performance
                                                                                                                                                                                          of
                                                                                                                                                                                          its
                                                                                                                                                                                          obligations
                                                                                                                                                                                          for
                                                                                                                                                                                          a
                                                                                                                                                                                          continuous
                                                                                                                                                                                          period
                                                                                                                                                                                          in
                                                                                                                                                                                          excess
                                                                                                                                                                                          of
                                                                                                                                                                                          three
                                                                                                                                                                                          (3)
                                                                                                                                                                                          months,
                                                                                                                                                                                          the
                                                                                                                                                                                          other
                                                                                                                                                                                          Party
                                                                                                                                                                                          may
                                                                                                                                                                                          terminate
                                                                                                                                                                                          this
                                                                                                                                                                                          Agreement
                                                                                                                                                                                          immediately
                                                                                                                                                                                          on
                                                                                                                                                                                          service
                                                                                                                                                                                          of
                                                                                                                                                                                          written
                                                                                                                                                                                          notice
                                                                                                                                                                                          upon
                                                                                                                                                                                          the
                                                                                                                                                                                          Party
                                                                                                                                                                                          so
                                                                                                                                                                                          prevented,
                                                                                                                                                                                          in
                                                                                                                                                                                          which
                                                                                                                                                                                          case
                                                                                                                                                                                          no
                                                                                                                                                                                          Party
                                                                                                                                                                                          shall
                                                                                                                                                                                          have
                                                                                                                                                                                          any
                                                                                                                                                                                          liability
                                                                                                                                                                                          to
                                                                                                                                                                                          any
                                                                                                                                                                                          other
                                                                                                                                                                                          except
                                                                                                                                                                                          that
                                                                                                                                                                                          rights
                                                                                                                                                                                          and
                                                                                                                                                                                          liabilities
                                                                                                                                                                                          which
                                                                                                                                                                                          accrued
                                                                                                                                                                                          prior
                                                                                                                                                                                          to
                                                                                                                                                                                          such
                                                                                                                                                                                          termination
                                                                                                                                                                                          shall
                                                                                                                                                                                          not
                                                                                                                                                                                          be
                                                                                                                                                                                          affected.



 


		27.4	The
                                                                                                                  Party claiming
                                                                                                                  to be prevented
                                                                                                                  or delayed in
                                                                                                                  the performance
                                                                                                                  of any of its
                                                                                                                  obligations
                                                                                                                  under this Agreement
                                                                                                                  by reason of
                                                                                                                  force majeure
                                                                                                                  shall use all
                                                                                                                  reasonable endeavours
                                                                                                                  to bring the
                                                                                                                  force majeure
                                                                                                                  event to a close
                                                                                                                  or to find a
                                                                                                                  solution by
                                                                                                                  which the Agreement
                                                                                                                  may be performed
                                                                                                                  despite the
                                                                                                                  continuance
                                                                                                                  of the force
                                                                                                                  majeure event.



 


		28.	AUDIT



 


		28.1	In
                                                                                                respect of all expenditure and
                                                                                                costs which is incurred by IFP
                                                                                                hereunder and which is reimbursable
                                                                                                by the Airline under this Agreement,
                                                                                                IFP shall maintain such accounts
                                                                                                and records (the 'Records) as
                                                                                                are reasonably necessary for the
                                                                                                purpose of enabling the Airline
                                                                                                to conduct an audit of that expenditure.



 


		28.2	IFP
                                                                                                will allow the Airline, by its
                                                                                                own personnel or by a professionally
                                                                                                qualified independent auditor,
                                                                                                access to all the Records during
                                                                                                the term of this Agreement and
                                                                                                for 12 months afterwards on not
                                                                                                less than 10 days written notice
                                                                                                at any time during normal business
                                                                                                hours for the purposes of auditing
                                                                                                or otherwise inspecting them,
                                                                                                provided that in the absence of
                                                                                                exceptional circumstances IFP
                                                                                                shall not be obliged to allow
                                                                                                such access or inspection more
                                                                                                than once during any 6 month period.



 


		28.3	Should
                                                                                                any audit or inspection of the
                                                                                                Records by the Airline reveal
                                                                                                that the Airline has been overcharged,
                                                                                                IFP shall reimburse to the Airline
                                                                                                the amount of the overcharge within
                                                                                                7 days and should the total overcharge
                                                                                                for the year exceed HK$100,000
                                                                                                then the Airline will also refund
                                                                                                any professional costs related
                                                                                                to the performance of the audit
                                                                                                (i.e. the cost of the auditors).



 


		28.4	IFP
                                                                                                will afford to the Airline all
                                                                                                reasonable assistance in the carrying
                                                                                                out of such audit, whilst the
                                                                                                Airline and its auditor will ensure
                                                                                                that any information obtained
                                                                                                in the course of the audit concerning
                                                                                                IFP's business is kept in the
                                                                                                strictest confidence and not used
                                                                                                for any purpose other than the
                                                                                                proper conduct of the audit.



 


		29.	RIGHT
                                                                                                                         OF REPLACEMENT



 


		29.1	The
                                                                                                Airline reserves the right to
                                                                                                demand the replacement at any
                                                                                                time by giving three (3) months’
                                                                                                notice of any employee agent or
                                                                                                subcontractor of IFP working on
                                                                                                the Airline's account if in the
                                                                                                opinion of the Airline the performance
                                                                                                of such person is unsatisfactory.
                                                                                                The Airline agrees to inform IFP
                                                                                                in writing of the reasons and
                                                                                                supporting evidence for the demand
                                                                                                to replace such employee, agent
                                                                                                or sub-contractor. If IFP receives
                                                                                                such a demand it shall replace
                                                                                                such person.



 


		29.2	IFP
                                                                                                warrants that the core team will
                                                                                                remain as specified at the outset
                                                                                                of this Agreement unless any of
                                                                                                this core team leaves IFP. In
                                                                                                such circumstances, IFP warrants
                                                                                                that it will replace such personnel
                                                                                                with personnel of the same or
                                                                                                higher caliber and experience.



 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 30 of 57



    	 



    

 


		29.3	It
                                                                                                is imperative that a dedicated
                                                                                                account manager is appointed to
                                                                                                work on the Airline account. Should
                                                                                                the current account manager leave
                                                                                                IFP for whatever reason, the Airline
                                                                                                is entitled to review the resumes
                                                                                                of any prospective candidates
                                                                                                for this role and approve the
                                                                                                appointment, since working with
                                                                                                the account manager will be a
                                                                                                critical factor in the success
                                                                                                of the working relationship of
                                                                                                the Parties.



 


		30.	NO AGENCY
                                                                                     OR PARTNERSHIP



 


		30.1	Nothing
                                                                                                                                                                                          in
                                                                                                                                                                                          this
                                                                                                                                                                                          Agreement
                                                                                                                                                                                          shall
                                                                                                                                                                                          constitute
                                                                                                                                                                                          or
                                                                                                                                                                                          be
                                                                                                                                                                                          deemed
                                                                                                                                                                                          to
                                                                                                                                                                                          constitute
                                                                                                                                                                                          a
                                                                                                                                                                                          partnership
                                                                                                                                                                                          between
                                                                                                                                                                                          the
                                                                                                                                                                                          Parties
                                                                                                                                                                                          hereto
                                                                                                                                                                                          or
                                                                                                                                                                                          constitute
                                                                                                                                                                                          IFP
                                                                                                                                                                                          as
                                                                                                                                                                                          agents
                                                                                                                                                                                          of
                                                                                                                                                                                          the
                                                                                                                                                                                          Airline
                                                                                                                                                                                          for
                                                                                                                                                                                          any
                                                                                                                                                                                          purpose
                                                                                                                                                                                          whatsoever
                                                                                                                                                                                          and
                                                                                                                                                                                          IFP
                                                                                                                                                                                          shall
                                                                                                                                                                                          have
                                                                                                                                                                                          no
                                                                                                                                                                                          authority
                                                                                                                                                                                          or
                                                                                                                                                                                          power
                                                                                                                                                                                          to
                                                                                                                                                                                          bind
                                                                                                                                                                                          the
                                                                                                                                                                                          Airline
                                                                                                                                                                                          or
                                                                                                                                                                                          to
                                                                                                                                                                                          contract
                                                                                                                                                                                          in
                                                                                                                                                                                          the
                                                                                                                                                                                          name
                                                                                                                                                                                          of
                                                                                                                                                                                          or
                                                                                                                                                                                          create
                                                                                                                                                                                          a
                                                                                                                                                                                          liability
                                                                                                                                                                                          against
                                                                                                                                                                                          the
                                                                                                                                                                                          Airline
                                                                                                                                                                                          in
                                                                                                                                                                                          any
                                                                                                                                                                                          way
                                                                                                                                                                                          or
                                                                                                                                                                                          for
                                                                                                                                                                                          any
                                                                                                                                                                                          purpose.
                                                                                                                                                                                          For
                                                                                                                                                                                          the
                                                                                                                                                                                          avoidance
                                                                                                                                                                                          of
                                                                                                                                                                                          doubt
                                                                                                                                                                                          in
                                                                                                                                                                                          all
                                                                                                                                                                                          its
                                                                                                                                                                                          contracts
                                                                                                                                                                                          for
                                                                                                                                                                                          third
                                                                                                                                                                                          party
                                                                                                                                                                                          goods
                                                                                                                                                                                          or
                                                                                                                                                                                          services,
                                                                                                                                                                                          IFP
                                                                                                                                                                                          shall
                                                                                                                                                                                          act
                                                                                                                                                                                          as
                                                                                                                                                                                          principal
                                                                                                                                                                                          at
                                                                                                                                                                                          law.



 


		31.	NOTICES



 


		31.1	Every
                                                                                                notice or communication under
                                                                                                this Agreement must be in writing
                                                                                                and may, without prejudice to
                                                                                                any other form of delivery, be
                                                                                                delivered personally or sent by
                                                                                                post or transmitted by fax or
                                                                                                email.



 


		31.1.1	In
                                                                                                                        the case
                                                                                                                        of posting,
                                                                                                                        the envelope
                                                                                                                        containing
                                                                                                                        the notice
                                                                                                                        or communication
                                                                                                                        must be
                                                                                                                        addressed
                                                                                                                        to the
                                                                                                                        intended
                                                                                                                        recipient
                                                                                                                        at the
                                                                                                                        authorised
                                                                                                                        address
                                                                                                                        of that
                                                                                                                        Party
                                                                                                                        and must
                                                                                                                        be properly
                                                                                                                        stamped
                                                                                                                        or have
                                                                                                                        the proper
                                                                                                                        postage
                                                                                                                        prepaid
                                                                                                                        for delivery
                                                                                                                        by the
                                                                                                                        most expeditious
                                                                                                                        service
                                                                                                                        available
                                                                                                                        (which
                                                                                                                        will be
                                                                                                                        airmail
                                                                                                                        if that
                                                                                                                        service
                                                                                                                        is available)
                                                                                                                        and, in
                                                                                                                        the case
                                                                                                                        of a fax
                                                                                                                        or email,
                                                                                                                        the transmission
                                                                                                                        must be
                                                                                                                        sent to
                                                                                                                        the intended
                                                                                                                        recipient
                                                                                                                        at the
                                                                                                                        authorised
                                                                                                                        number
                                                                                                                        or address
                                                                                                                        of that
                                                                                                                        Party.



 


		31.1.2	Subject
                                                                                                                        to Clause
                                                                                                                        31.2,
                                                                                                                        for
                                                                                                                        the purpose
                                                                                                                        of Clause
                                                                                                                        31, please
                                                                                                                        refer
                                                                                                                        to SCHEDULE
                                                                                                                        3 - CONTACT
                                                                                                                        AND DELIVERY
                                                                                                                        DETAILS
                                                                                                                        for
                                                                                                                        the authorised
                                                                                                                        address,
                                                                                                                        fax number
                                                                                                                        and email
                                                                                                                        of each
                                                                                                                        Party.



 


		31.2	No
                                                                                                change in any of the particulars
                                                                                                set out in SCHEDULE 3 - CONTACT
                                                                                                AND DELIVERY DETAILS will
                                                                                                be effective against a Party until
                                                                                                it has been notified to that Party.



 


		31.3	A
                                                                                                notice or communication will be
                                                                                                deemed to have been duly given
                                                                                                and received:-



 


		31.3.1	on
                                                                                                                        personal
                                                                                                                        delivery
                                                                                                                        to an
                                                                                                                        addressee
                                                                                                                        or on
                                                                                                                        a business
                                                                                                                        day to
                                                                                                                        a place
                                                                                                                        for the
                                                                                                                        receipt
                                                                                                                        of letters
                                                                                                                        at that
                                                                                                                        addressee's
                                                                                                                        authorised
                                                                                                                        address;
                                                                                                                        or



 


		31.3.2	in the case of posting,
                                                                                                      where the addressee's authorised
                                                                                                      address is in the same country
                                                                                                      as the country of posting,
                                                                                                      at 10 a.m. (local time at
                                                                                                      the place where the address
                                                                                                      is located) on the second
                                                                                                      business day after the day
                                                                                                      of posting; or



 


		31.3.3	in
                                                                                                      the case of posting, where
                                                                                                      the addressee's authorised
                                                                                                      address is not the same
                                                                                                      country as the country of
                                                                                                      posting, at 10 a.m. (local
                                                                                                      time at the place where
                                                                                                      that address is located)
                                                                                                      on the fifth business day
                                                                                                      after the day of posting;
                                                                                                      or -



 


		31.3.4	in
                                                                                                      the case of a fax, on issue
                                                                                                      to the sender of an O.K.
                                                                                                      result confirmation report
                                                                                                      or, if the day of issue
                                                                                                      is not a business day, at
                                                                                                      10 a.m. (local time where
                                                                                                      the authorised fax number
                                                                                                      of the intended recipient
                                                                                                      is located) on the next
                                                                                                      business day or



 


		31.3.5	in
                                                                                                                                                            the
                                                                                                                                                            case
                                                                                                                                                            of
                                                                                                                                                            an
                                                                                                                                                            email,
                                                                                                                                                            when
                                                                                                                                                            the
                                                                                                                                                            sender
                                                                                                                                                            receive
                                                                                                                                                            acknowledgement
                                                                                                                                                            from
                                                                                                                                                            the
                                                                                                                                                            address.



 


		31.4	For
                                                                                                                  the purpose
                                                                                                                  of Clause
                                                                                                                  31.3, a "business
                                                                                                                  day" means
                                                                                                                  a day which
                                                                                                                  is not a Saturday
                                                                                                                  or a Sunday
                                                                                                                  or a public
                                                                                                                  holiday in the
                                                                                                                  country of posting
                                                                                                                  or transmission
                                                                                                                  or in the country
                                                                                                                  where the authorised
                                                                                                                  address or fax
                                                                                                                  number of the
                                                                                                                  intended recipient
                                                                                                                  is located and,
                                                                                                                  where a notice
                                                                                                                  is posted, which
                                                                                                                  is not a day
                                                                                                                  when there is
                                                                                                                  a disruption
                                                                                                                  of postal services
                                                                                                                  in either country
                                                                                                                  which prevents
                                                                                                                  collection or
                                                                                                                  delivery.



 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 31 of 57



    	 



    

 


		32.	SUCCESSORS



 


		32.1	This
                                                                                                                                                                                          Agreement
                                                                                                                                                                                          is
                                                                                                                                                                                          binding
                                                                                                                                                                                          on
                                                                                                                                                                                          the
                                                                                                                                                                                          successors
                                                                                                                                                                                          of
                                                                                                                                                                                          each
                                                                                                                                                                                          Party.



 


		33.	LAW
                                                                                                                  AND JURISDICTION



 


		33.1	This
                                                                                                                  Agreement is
                                                                                                                  governed by
                                                                                                                  and will be
                                                                                                                  construed in
                                                                                                                  accordance with
                                                                                                                  Hong Kong law.



 


		33.2	The
                                                                                                                                                                                          parties
                                                                                                                                                                                          submit
                                                                                                                                                                                          to
                                                                                                                                                                                          the
                                                                                                                                                                                          non-exclusive
                                                                                                                                                                                          jurisdiction
                                                                                                                                                                                          of
                                                                                                                                                                                          the
                                                                                                                                                                                          Hong
                                                                                                                                                                                          Kong
                                                                                                                                                                                          courts
                                                                                                                                                                                          and
                                                                                                                                                                                          each
                                                                                                                                                                                          Party
                                                                                                                                                                                          waives
                                                                                                                                                                                          any
                                                                                                                                                                                          obligation
                                                                                                                                                                                          to
                                                                                                                                                                                          proceeding
                                                                                                                                                                                          in
                                                                                                                                                                                          Hong
                                                                                                                                                                                          Kong
                                                                                                                                                                                          on
                                                                                                                                                                                          the
                                                                                                                                                                                          grounds
                                                                                                                                                                                          of
                                                                                                                                                                                          venue
                                                                                                                                                                                          or
                                                                                                                                                                                          inconvenient
                                                                                                                                                                                          forum.



 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 32 of 57



    	 



    

 


IN WITNESS whereof the Parties hereto have
caused this Agreement to be duly executed by their authorised representatives the day and year first above written


 


	Signed for	 	Witnessed by:
	CATHAY PACIFIC AIRWAYS LTD. by:	 	 
	 	 	 
	/s/
    Alex McGowan	 	/s/
    Eva Chan
	Alex McGowan	 	Eva Chan
	Manager Product	 	Assistant Purchasing Manager - Marketing
	 	 	 
	Date: 7/14/2008	 	Date: 7/14/2008
	 	 	 
	Signed for	 	Witnessed by:
	HONG KONG DRAGON AIRLINES LTD. 	 	 
	by its duly authorized agent:	 	 
	 	 	 
	/s/
    Alex McGowan	 	/s/
    Eva Chan
	Alex McGowan	 	Eva Chan
	Manager Product	 	Assistant Purchasing Manager - Marketing
	 	 	 
	Date: 7/14/2008	 	Date:7/14/2008
	 	 	 
	Signed for	 	Witnessed by:
	INFLIGHT PRODUCTIONS LTD. 	 	 
	by:	 	 
	 	 	 
	/s/
    Joan Barker	 	/s/
    Janet Winstanley
	Joan Barker	 	Janet Winstanley
	Sales & Marketing Director	 	Client Services Manager
	 	 	 
	Date: 8/1/2008	 	Date: 8/1/2008




 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 33 of 57



    	 



    

 


SCHEDULE 1 -PROGRAMME SPECIFICATIONS


 


For Cathay:


 


Specification of Western Movies


 


		1.	Overall
                                                                                                                        Strategy
                                                                                                                        for Movies



 


		(a)	Cathay
                                                                                                                  aims to present
                                                                                                                  a diverse and
                                                                                                                  interesting
                                                                                                                  range of movies
                                                                                                                  from Hollywood's
                                                                                                                  blockbusters
                                                                                                                  to popular Asian
                                                                                                                  movies, from
                                                                                                                  the hottest
                                                                                                                  new releases
                                                                                                                  to classic movies.



 


		(b)	The
                                                                                                                  selection includes
                                                                                                                  new releases,
                                                                                                                  popular blockbusters
                                                                                                                  and internationally
                                                                                                                  acclaimed art
                                                                                                                  house movies
                                                                                                                  in multiple
                                                                                                                  languages catering
                                                                                                                  to the Cathay's
                                                                                                                  diverse demographic
                                                                                                                  mix. The languages
                                                                                                                  include English,
                                                                                                                  Cantonese, Mandarin,
                                                                                                                  Japanese, Korean,
                                                                                                                  Hindi, French,
                                                                                                                  Italian and
                                                                                                                  German



 


		(c)	Movies
                                                                                                                  are only available
                                                                                                                  on routes of
                                                                                                                  over 2 hours
                                                                                                                  40 minutes flying
                                                                                                                  time.



 


		(d)	On
                                                                                                                                                            regional
                                                                                                                                                            aircraft,
                                                                                                                                                            ***
                                                                                                                                                            movies
                                                                                                                                                            are
                                                                                                                                                            offered
                                                                                                                                                            each
                                                                                                                                                            month
                                                                                                                                                            on
                                                                                                                                                            the
                                                                                                                                                            Distributed
                                                                                                                                                            Channels
                                                                                                                                                            (***
                                                                                                                                                            on
                                                                                                                                                            inbound
                                                                                                                                                            flights
                                                                                                                                                            and
                                                                                                                                                            ***
                                                                                                                                                            on
                                                                                                                                                            outbound
                                                                                                                                                            flights)
                                                                                                                                                            in
                                                                                                                                                            all
                                                                                                                                                            classes.



 


		(e)	On
                                                                                                                                                            long-haul
                                                                                                                                                            Aircraft
                                                                                                                                                            equipped
                                                                                                                                                            with
                                                                                                                                                            Panasonic
                                                                                                                                                            3000
                                                                                                                                                            IFE
                                                                                                                                                            system,
                                                                                                                                                            ***
                                                                                                                                                            movies
                                                                                                                                                            are
                                                                                                                                                            offered
                                                                                                                                                            each
                                                                                                                                                            month
                                                                                                                                                            on
                                                                                                                                                            the
                                                                                                                                                            Distributed
                                                                                                                                                            Channels
                                                                                                                                                            (***
                                                                                                                                                            on
                                                                                                                                                            inbound
                                                                                                                                                            flights
                                                                                                                                                            and
                                                                                                                                                            ***
                                                                                                                                                            on
                                                                                                                                                            outbound
                                                                                                                                                            flights)
                                                                                                                                                            in
                                                                                                                                                            Economy
                                                                                                                                                            Class
                                                                                                                                                            while
                                                                                                                                                            ***
                                                                                                                                                            movies
                                                                                                                                                            are
                                                                                                                                                            offered
                                                                                                                                                            each
                                                                                                                                                            month
                                                                                                                                                            on
                                                                                                                                                            the
                                                                                                                                                            AVOD
                                                                                                                                                            system
                                                                                                                                                            in
                                                                                                                                                            First
                                                                                                                                                            and
                                                                                                                                                            Business
                                                                                                                                                            Class.



 


		(f)	On
                                                                                                                                                            long-haul
                                                                                                                                                            Aircraft
                                                                                                                                                            equipped
                                                                                                                                                            with
                                                                                                                                                            Panasonic
                                                                                                                                                            eX2
                                                                                                                                                            IFE
                                                                                                                                                            system,
                                                                                                                                                            ***
                                                                                                                                                            Movies
                                                                                                                                                            on
                                                                                                                                                            the
                                                                                                                                                            AVOD
                                                                                                                                                            system
                                                                                                                                                            are
                                                                                                                                                            offered
                                                                                                                                                            in
                                                                                                                                                            all
                                                                                                                                                            classes.



 


		2.	Movies
                                                                                                                        Categories



 


		(a)	A
                                                                                                                  total of 50
                                                                                                                  movies are offered
                                                                                                                  each month under
                                                                                                                  the following
                                                                                                                  categories:



 


	 	 	Quantity
    available each flight	 	 
	 	 	Distributed
    Channel	 	 	 	 
	Categories	 	Regional

    aircraft	 	Long-haul

    aircraft	 	AVOD	 	Description
	New
    Release	 	***	 	***	 	***	 	Hollywood's
    hottest new blockbusters. (*** of them are updated every month.)
	Re-View	 	***	 	***	 	***	 	Hit
    movies from the past few years. (*** of them areupdated every
    month.)
	Arthouse	 	***	 	***	 	***	 	The
    best independent films and arthouse movies. (*** of them are
    updated every month.)
	Asia
    on Film	 	***	 	***	 	***	 	Quality
    Asian cinema_ selected from the best in the region.(*** of them
    are updated everymonth.)
	Disney	 	***	 	***	 	***	 	A
    selection of Disney movies for the young ones aboard. (*** of
    them is updated every month.)
	Your
    Favourites	 	***	 	***	 	***	 	Our
    selection of specially- themed movies. (*** of them are updated
    every month.)
	Total	 	***	 	***	 	***	 	 


 

 



*** Confidential treatment requested.

 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 34 of 57



    	 



    

 


		3.	Specification of Western Movies



 


		(a)	Please refer to the Video Channel Line-up for details.



 


		(b)	The quantity of movies shown below is the total number
of movies required every month for both inbound and outbound flights.



 


	Categories	 	Quantity	 	Movie
    Code	 	Language	 	Subtitles
	For
    distributed channels of long-haul flights of all aircraft:
	New
    Releases	 	***	 	0/B:
    A, C,E, G, I, K1/B: B, D, F,H J L	 	English
    (+1)	 	Chinese
	Re-View	 	***	 	0/B:
    M

1/B: N	 	English
    ( +1)	 	Chinese
	Arthouse	 	***	 	0/B:
    0

1/B: p	 	Original	 	Chinese
	Disney	 	***	 	0/B:
    Y, AA

1/B: Z, BB	 	English
    and Cantonese	 	N/A
	For
    distributed channels of long-haul flights of long-haul aircraft only:
	Re-View	 	***	 	0/B:
    CC

1/B: DD	 	English
    (+1)	 	Chinese

    (optional)
	Arthouse	 	***	 	0/B:
    EE

1/ B: FF	 	Original	 	Chinese

    (optional)
	For
    AVOD of long-haul flights of long-haul aircraft only:
	Re-View	 	***	 	N/A	 	English
    (+1)	 	Chinese

    (optional)
	Arthouse	 	***	 	N/A	 	Original	 	Chinese

    (optional)
	Your
    Favourites	 	***	 	N/A	 	English
    (+1)	 	Chinese

    (optional)
	TOTAL	 	***	 	 	 	 	 	 


 


		(c)	Remarks:



"0/B" means outbound
flight, "1/B" means inbound flight


The following movies are held
over from the previous month:


***
movies from New Releases


***
movies from Disney


***
movies from Re-View in AVOD system


***
movies from Arthouse in AVOD system


***
movies from Your Favourites in AVOD system


"English
(+1)" means the movie should be in English and it is preferable to have audio soundtrack of an additional language, which
can be French, German, Italian, Japanese or Korean.


		•	"Original" means the audio soundtrack should
be in original language of the movie, e.g. English, French, German and Italian.



"Chinese
(optional)" mea ns it is preferable to have Chinese subtitles if it is available.


 


		(d)	Other Requirements



 


There
should be at least one movie with each of the additional languages in the movie mix each month.


 


		•	For
*** out of the ***
movies held over in the New Release category, the choice of additional language should be different from the one shown in the
previous month.



 

 



*** Confidential treatment requested.

 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 35 of 57



    	 



    

 


Specification of Western Short Features


 


		1.	Overall Strategy for Short Features



 


		(a)	Popular TV programmes are acquired from around the world.
The selection includes popular sitcoms, lifestyle, documentary and sport programmes in English, Cantonese, Mandarin, Japanese
and Hindi.



 


		(b)	As well as high rating shows, we also seek to include a
variety of niche programming that has received critical acclaim.



 


		(c)	A
total of up to *** of Western Short Features is offered on Distributed
Channels (*** on inbound flights and *** on
outbound flights) in all classes of regional Aircraft and in Economy Class of long-haul Aircraft equipped with Panasonic 3000
IFE system.



 


		(d)	Over
*** of Western Short Features are shown on AVOD system each month
in First and Business Class of long-haul Aircraft equipped with Panasonic 3000 IFE system and in all classes of long-haul Aircraft
equipped with Panasonic eX2 IFE system.



 


		(e)	On routes over 2 hours 40 minutes flying time, compilations
of 135-minute short feature programmes are shown on repeating cycles. There are 8 TV channels on flights operated by regional
Aircraft while there are 12 TV channels on flights operated by long-haul Aircraft.



 


		(f)	On routes under 2 hours 40 minutes flying time, compilations
of 50-minute short feature programmes are shown on repeating cycles. There are 20 TV channels on flights operated by regional
Aircraft while there are 26 TV channels on flights operated by long-haul Aircraft.



 


		(g)	All programmes, except those in the TV Series category
(TV box sets) are updated monthly, while at least one box set is updated every month. For short features offered on the Disney
Channel, 2 hours of the programming is updated every 3 months.



 


		(h)	50-minute and 135-minute programming blocks are combinations
of 30-minute programmes and 50-minute programmes. The number of programmes selected in a programming block may vary depending
on the actual runtime of the programmes included. Extra fillers may be required to fill up a 50-min. or 135-min. programming block.



 

 



*** Confidential treatment requested.

 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 36 of 57



    	 



    

 


		2.	Short Features Categories



 


		(a)	Over 80 hours of short features are offered each month
under the following categories:



 


	Categories	 	Quantity	 	Description
	HKTV	 	30
        min x ***

        50
min x ***
	 	Cantonese
    programmes and variety shows
	TV
    Asia	 	30
        min x ***

        60
        min x ***
	 	An
    entertaining selection of Asian short features
	Comedy	 	30
    min x ***	 	Smash-hit
    comedies from all around the globe
	E!
    Entertainment	 	30min
        x ***

        60min
        x ***
	 	Gossip,
    style news and celebrity interviews from Hollywood
	Lifestyle
    & Reality	 	30
        min x ***

        60
        min x ***
	 	Must-watch
    international reality and lifestyle shows


 

 



*** Confidential treatment requested.

 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 37 of 57



    	 



    

 


	Categories	 	Quantity	 	Description
	Drama	 	60
    min x ***	 	Action,
    romance and more from the world's hottest dramas
	Documentary	 	30
        min x ***

        60
        min x ***
	 	Riveting
    and thought-provoking documentaries
	Discovery	 	60
    min x ***	 	Exploring
    the history and mysteries of our planet
	Disney
    Channel	 	30
    min x ***	 	The
    most popular cartoons from the Disney Channel
	Sport	 	30min
        x ***

        60
        min x ***
	 	News,
    profiles and highlights from the sporting world
	News
    & Sports	 	15
        min x *** (Daily)

        30
        min x *** (Weekly)

        ***

        (1 Hour)
	 	Daily
    news and coverage of major sporting events
	TV Series

        (Box Sets)
	 	30
        min x ***

        3
        x 60 minx ***

        (21 hours)
	 	Get
    hooked on box-sets of the hottest TV shows on the planet
	Total	 	***	 	 


 


		(b)	Remarks:



		•	TV
Series is only available in the AVOD library. It consists of ***
Drama box sets (*** x
60 min), *** Documentary box set (***
x 60 min) and *** Comedy box set (***
x 30 min). Drama and Documentary box sets are updated quarterly, while the Comedy box set is updated bi-monthly.



 


		3.	Channel Line-up for Distributed Channels



 


	 	 	No.
    of channels available on each flight
	 	 	Flights
    over 2 hr. 40 min.

    (Long-haul flights)	 	Flights
    under 2 hr. 40 min.

    (Short-haul flights)
	Category	 	Regional

        Aircraft
	 	Long-haul

        Aircraft
	 	Regional

        Aircraft
	 	Long-haul

        Aircraft

	HKTV	 	***	 	***	 	***	 	***
	TV
    Asia	 	***	 	***	 	***	 	***
	Comedy	 	***	 	***	 	***	 	***
	E!
    Entertainment	 	***(Outbound)	 	***	 	***	 	***
	Lifestyle
    & Reality	 	***
    (Inbound)	 	***	 	***	 	***
	Drama	 	***
    (Inbound)	 	***	 	***	 	***
	Documentary	 	***
    (Outbound)	 	***	 	***	 	***
	Discovery	 	***	 	***	 	***	 	***
	Disney
    Channel	 	***	 	***	 	***	 	***
	Sport	 	***	 	***	 	***	 	***
	News
    & Sports	 	***	 	***	 	***	 	***
	Total	 	***
        (Inbound)

        ***
        (Outbound)
	 	***
        (Inbound)

        ***
        (Outbound)
	 	***	 	***


 

 



*** Confidential treatment requested.

 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 38 of 57



    	 



    

 


		4.	Specification
of Western Short Features



 


		(a)	Please refer to the Video Channel Line-up
for details.



 


		(b)	The quantity shown below
                                                                                                is the total number
                                                                                                of Western Short Features Programmes required every month for both inbound and outbound flights.



 


	Categories	 	Quantity	 	Language	 	Subtitles
	

        Comedy
	 	30 min
    x***	 	English
	 	Chinese

        (5
        hours)

	E!
        Entertainment
	 	30 min
    x ***
    60 min
    x ***	 	English
	 	

        N/A

	Lifestyle
        & Reality
	 	30 min
    x ***
    60 min
    x ***	 	English
	 	

        N/A

	

        Drama
	 	60 min x ***	 	English
	 	Chinese

        (6
        hours)

	Documentary
	 	30 min
    x ***
    min x
    ***	 	English
	 	

        N/A

	Discovery
	 	60 min
    x ***	 	English
	 	

        N/A

	Disney
        Channel
	 	30 min
    x ***	 	English
        and

        Cantonese
	 	

        N/A

	Sport
	 	30 min x
    *** 60 min
    x ***	 	English
	 	 N/A

	TV
        Series

        (Box
        Sets)
	 	30
        min x
        *** (Comedy)

        3
        x 60
        min x ***

        (2
        Drama, 1Documentary) ***
	 	 

        English
	 	  

        N/A

	TOTAL	 	***	 	 	 	 


 


		(c)	Remarks:






		•	Chinese
                                                                                                                                                                    subtitles
                                                                                                                                                                    are
                                                                                                                                                                    required
                                                                                                                                                                    for
                                                                                                                                                                    ***
                                                                                                                                                                    hours
                                                                                                                                                                    of
                                                                                                                                                                    programmes
                                                                                                                                                                    in
                                                                                                                                                                    the
                                                                                                                                                                    category
                                                                                                                                                                    of
                                                                                                                                                                    Comedy
                                                                                                                                                                    and
                                                                                                                                                                    ***
                                                                                                                                                                    hours
                                                                                                                                                                    of
                                                                                                                                                                    programmes
                                                                                                                                                                    in
                                                                                                                                                                    the
                                                                                                                                                                    category
                                                                                                                                                                    of
                                                                                                                                                                    Drama.






		•	Drama and Documentary box sets
are updated quarterly,
while Comedy box set is updated
bi-monthly.



 


Technical Specification
for Western Movies and Western Short Features





		(a)	Specification for Broadcast
Channels






		•	NTSC system






VHS
cassettes





		•	Stereo



 


		(b)	Specification for AVOD






		•	Encoding: MPEG
1 @ 352 x 240



Constant bit rate


Video bit rate @
1.5 Mb/s





		•	Audio bit rate
@ 128kb/s



NTSC@ 30
fps


 





 



*** Confidential treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 39 of 57



    	 



    

 


Specification of
Audio


 


		1.	Overall Strategy
for Audio



 


		(a)	Cathay strives to bring
passengers the best audio entertainment
in the sky.
The music incorporates various genres and styles from
all around the world.
It is carefully chosen to suit all musical tastes. There are currently 22
broadcast radio channels in 9 different languages for passengers to select from.
The programmes range from the latest pop and rock
to classical, jazz, relaxation tips
and interviews with
the stars. They are available for passengers of all classes.



 


		(b)	Audio
on Demand (AOD) system
with a CD library is available
to passengers in First and Business Class on long-haul aircraft equipped with Panasonic
3000 IFE system and
passengers in all classes on long-haul aircraft equipped
with Panasonic eX2
IFE system. There
is also a Juke Box
function that allows passengers to compile their
own song list.



 


		(c)	There are
currently 10 categories featuring
approximately 150 CD
albums from around
the globe. 15 CDs are updated on a monthly basis. In addition
to the CD library, 12 CDs are selected specifically
for children.



 


		(d)	Boarding music is produced
every year and is played on all flights
during take off and landing for
passengers to relax and
enjoy.



 


		2.	Radio Channels



 


		(a)	There
are a total of 22 customised radio channels
available in all classes on all routes. All channels are
broadcast in a repeating cycle of 120 minutes.



 


	 

        No.
	 	Channel

    name	 	 

        Description
	 	Update

        frequency
	 	 

        Language

	1	 	Hot:HK	 	
        Hosted programme
        with the greatest

        Cantonese pop
        from HK charts. Upbeat & Lively, targets passengers of 20s to
        40s.
	 	Monthly	 	Cantonese
	2	 	
        A Musical

        Journey
	 	Hosted programme with the most memorable tunes. Stories interweave between songs. Targets more mature _Qassengers.	 	Monthly	 	Cantonese
	3	 	
        Mandarin

        Zone
	 	
        Hosted programme with latest

        Mandarin hits including
        artist interviews.
	 	Monthly	 	Mandarin
	4	 	
        Chinese All

        Time Hits
	 	
        Hosted programme
        with the most

        memorable Chinese hits from
        the good old days.
	 	Monthly	 	Cantonese
	5	 	J-Pop	 	
        Hosted programme
        with the latest

        Japanese Pop
        music or New Enka.
	 	Monthly	 	Japanese
	6	 	
        Mumbai

        Beat
	 	Hosted programme with a mix of Indian fusion, Bollywood remixes, Bollywood songs, ghazals and older film music.	 	Monthly	 	
        Indian

         

        -

	7	 	
        Philippine

        Soundwave
	 	
        Hosted
        programme the latest and best from the Philippine music

        world.
	 	Monthly	 	Tagalog
	8	 	
        Classical

        Moods
	 	
        Popular and
        familiar light classics

        from the great
        composers, uninterrupted. (No Presenter)
	 	Monthly	 	N/A
	9	 	
        Classical

        Choice
	 	
        Hosted programme with a
        mix of

        favourite pieces
        from the lighter side
        of the classical-music repertoire,

        with works
        by a varied collection of

        composers.
	 	Monthly	 	English
	10	 	
        All Time

        Hits
	 	Hosted programme with favourite hits from the 50s, 60s and 70s.	 	Monthly	 	English


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 40 of 57



    	 



    

 


	No.	 	Channel

    name	 	Description	 	Update

    frequency	 	Language
	11	 	Rewind	 	Hosted by programme with the 80's to 90's pop or rock show.	 	Monthly	 	English
	12	 	Popzone	 	
        Hosted programme
        with the fastest moving, high-flying chart show

        direct from Planet Pop! All the
        latest tracks are here
        from some of the biggest stars in music today.
	 	Monthly	 	English
	13	 	Rock	 	Hosted programme with a selection of the best rock in the sky as he plays new and classic music from some of the world's greatest bands.	 	Monthly	 	English
	14	 	Dancescape	 	Hosted programme with the DJ's personal selection, get in the beat or simply chill out to these tunes.	 	Monthly	 	English
	15	 	Easy Moods	 	
        Hosted programme with a mellow

        mix of
        light contemporary love
        songs and ballads from a diverse group of artists.
	 	Monthly	 	English
	16	 	Jazz	 	Hosted programme with a collection of cool, laid-back jazz.	 	Monthly	 	English
	17	 	Serenity	 	two hours of physical and mental relaxation, peaceful music, health and travel tips etc. (No presenter)	 	Bi-monthly	 	English
	18	 	
        Music

        Special
	 	Hosted programme with two hours of music and celebrity_ interviews.	 	Bi-monthly	 	English
	19	 	J-Medley	 	Hosted programme with older pop songs and all time hits from 70s to early 2000s. This channel also includes some instrumental pieces, light jazz and well-known Enka.	 	Bi-monthly	 	Japanese
	20	 	
        Korean

        Music Box
	 	Hosted programme with
    music from the movies,
    TV and chart-topping artists of Korea.	 	Bi-monthly	 	Korean
	21	 	Malay Hits	 	Hosted programme with the current Malaysian music. A big portion of the channel will spotlight the latest Malay pop songs, and there are also some more popular Indonesian pop songs.	 	Bi-monthly	 	Malay
	22	 	Thai Mix	 	
        Hosted
        programme with a variety of

        Thai contemporary
        hits.
	 	Bi-monthly	 	Thai


 


		(b)	Each audio channel
is 120 minutes in length and
has approximately 26 tracks.



 


		(c)	All channels, except 'Classical
Moods' and "Serenity", are hosted
with one presenter.



 


		(d)	The presenters
must be suitable for
Cathay's demographics, and should
not have strong accents.



 


		(e)	There are
currently no sponsored channels.



 


		(f)	Jingles are sometimes
used and are permitted. (g) Presenters usually
make reference to Cathay.



 


		(h)	Presenters may
conduct interviews with celebrities or guests where appropriate.



 


		(i)	Method of
recording is flexible
as long as the end
product is suitable
for inflight listening.
They can be
recorded
either on computer
or in studio.



 


		(j)	16 channels a re
updated every
month while 6 channels a
re updated bi-monthly.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 41 of 57



    	 



    

 


		3.	Audio on
Demand (AOD) Library



 


		(a)	The AOD
Library is available
to passengers in First and Business
Class on
long-haul aircraft
equipped with Panasonic 3000 IFE system and
passengers in all classes on
long-haul aircraft equipped with Panasonic
eX2 IFE system. There
are currently 10 categories featuring
up to 150
CD albums.



 


	Genre	 	Description
	All Time Hits	 	"Best of ...." compilations from major artists and specifically to feature officially released 'Greatest Hits' albums by international selling artists.
	 	 	 
	Classic Albums	 	Classic albums are generally considered to have stood the test of time, and remained popular throughout changing trends in recent music history, e.g. Hotel California of Eagles, Sgt. Pepper's Lonely Hearts Club Band of Beatles.
	 	 	 
	Rock & Pop	 	
        The
biggest new releases and internationally
renowned pop and rock
performers, Western pop
COs from the US and UK charts, e.g.
Confessions On The
Dance Floor of Madonna
and X
& Y of Coldplav.

	 	 	 
	Easy Listening	 	A cool and pop collection of contemporary easy listening ballads.
	 	 	 
	Country	 	A dedicated channel for 'Country' enthusiasts.
	 	 	 
	Jazz	 	A dedicated channel for 'Jazz' enthusiasts. Focus on internationally popular artists.
	 	 	 
	Soundtracks	 	Introduce classic musicals, soundtracks of movies like Grease, Saturday Night Fever etc.
	 	 	 
	Classical	 	Includes classical and opera music. Mostly well-known popular favourites with a few more challenging works.
	 	 	 
	Cantonese	 	Latest Cantonese pop albums, plus new releases of older artists (e.g. Greatest Hits releases). New albums of old songs including New and Best of, e.g. Tribute to Leslie Cheung.
	 	 	 
	Asian Selection	 	Primarily pop
    for Mandarin like Fish Leong,
    Stefanie Sun, old
    COs like Teresa Teng,
    Emil Chau;
    Korean e.g. BoA, Rain
    & Japanese including
    some old albums like The
    best of Pink Lady, New
    Enka e.g. KiyoshiHikawa ; Japanese
    easy listening e.g.
    Ken Hirai &
    Rimi Natsukawa; and
    selections from other
    countries occasionally (Philippines,
    Hindi).


 


		(b)	There is currently a CD
library of approximately 150
COs.



 


		(c)	There is
a Juke Box function that allows passengers to compile
their own song list.



 


		(d)	15 COs
will be changed
every month to ensure
that the assortment is
up-to-date.



 


		(e)	The COs
are divided into 10
categories and a
minimum of five
COs is required in each category.



 


		(f)	In addition to the CD library,
12 COs are specially selected
for children, aged from 3 to teen. COs
in the Kids category
are updated on ad
hoc basis as agreed
between the parties.



 


		4.	Boarding Music



 


		(a)	Boarding
music is played during
take off and landing when the
IFE system is switched
off.



 


		(b)	Flashcards (2
types: PCMCIA and
Compact Flash) are
used for boarding
music.



 


		(c)	3 sets of boarding
music are produced
every year: 1st set
is used in January, February, July
and August, 2nd set is used in March, April, September
and October and 3rd set is
used in May, June,
November and December.





    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 42 of 57



    	 



    

 


		(d)	Boarding music is
30 minutes long and can
range from 3 to 7
tracks depending on the length
of the track.



 


		(e)	For existing
Panasonic PRAM System, 6
flashcards are required
per year, based on 2 duplications
for each new variation of boarding music (i.e. 3 variations
produced per year)



 


		(f)	For Airbus
A340-600 iPRAM System, 1 flashcard is needed per
aircraft that holds ALL boarding
music for a whole year.
Under current practice,
the flashcard is sourced locally
by Cathay and Cathay's engineers programme
the boarding music into the flashcards.



 


		(g)	Requirements
for boarding music: it
should be non-intrusive, easy listening
and reflect Cathay's branding.



 


Technical Specifications for
Audio


 


		1.	Radio Channels



 


		(a)	One set of CDs is
required for each aircraft and extra sets of CDs are required
as buffer.



 


		(b)	All CDs should contain mono
tracks and there are no stereo tracks.
On each CD, there should be 4 mono tracks.



 


		(c)	For aircraft
equipped with Panasonic eX2 IFE
system, the "Radio
Channels" will
be run in AOD
format. For all other aircraft, the "Radio Channels"
will be run on CD format.



 


		(d)	The update
frequency and channels
per track information are
detailed below:



 


	CD no.	 	Channel

no.	 	Current Categories	 	Programme

Cycle
	CD 1ex	 	4	 	Hot: HK	 	Monthly
	 	 	5	 	A Musical Journey	 	 
	 	 	6	 	Mandarin Zone	 	 
	 	 	7	 	Chinese All Time Hits	 	 
	CD 2 ex	 	8	 	J-Pop	 	Monthly
	 	 	9	 	Mumbai Beat	 	 
	 	 	10	 	Philippine Soundwave	 	 
	 	 	11	 	Classical Moods	 	 
	CD 3 ex	 	12	 	Classical Choice	 	Monthly
	 	 	13	 	All Time Hits	 	 
	 	 	14	 	Rewind	 	 
	 	 	15	 	Pop Zone	 	 
	CD 4 ex	 	16	 	Rock	 	Monthly
	 	 	17	 	Dancescape	 	 
	 	 	18	 	Easy Moods	 	 
	 	 	19	 	Jazz	 	 
	CD sex	 	20	 	Serenity	 	Bi-monthly
	 	 	21	 	Music Special	 	 
	 	 	22	 	J-Medley	 	 
	 	 	23	 	Korean Music Box	 	 
	CD 6 ex	 	24	 	Malay Hits	 	Bi-monthly
	 	 	25	 	Thai Mix	 	 


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 43 of 57



    	 



    

 


		2.	AOD specification



 


		(a)	Audio Elementary Stream:
AES






Layer 1&
2 Audio (MP1MP2 NOT MP3)


Joint
stereo/stereo/mono/dual


		•	Bit rate @ 128 Kbs



Sample Rate
@ 44.1KHz


		(b)	Transport stream file format:






		•	PAT PID = OxOO
PMT PID = Ox3F



		•	PCR PID = Ox30



		•	Video ES 1PID = Ox30



		•	Audio ES 1PID=Ox31



Audio ES 1PID = Ox32 OPTIONAL


		•	Audio ES 1PID=Ox33
OPTIONAL



		•	Audio ES 1PID=Ox34
OPTIONAL



 


		3.	Boarding Music specification



 


		(a)	For the current Panasonic
IFE System, PRAM is used.
Model is
RDA X7673-01
and RDAX7675-01 which supports 40MB PCMCIA flashcards. All
flashcards need to
be encoded by the Panasonic encoder. IFP is required to update the
flashcards with
the encoded contents



 


		(b)	For Airbus A340-600 iPRAM
System, the unit is integrated into the Airbus
FAP unit which supports
up to 256MB COMPACT FLASH flashcards. The
contents
are encoded in MP3 format and put on the flashcard via
the KID Compiler tool.
IFP is required
to provide the content in a CD for Cathay to update it to the COMPACT
FLASH flashcard on the aircraft.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 44 of 57



    	 



    

 


For Dragonair:


 


Specification of
Western Movies


 


		1.	Overall Strategy for Movies



 


		(a)	Dragonair aims to present
a diverse and interesting
range of movies from
Hollywood's blockbusters to popular Asian movies, with content
free from controversial topics touching
on political, racial,
cultural and religious
issues.



 


		(b)	The selection
includes new releases, popular blockbusters and
Asian movies in multiple
languages catering to the
airline's diverse
demographic mix.



 


		(c)	Movies are only available
on routes over 2 hours 40 minutes flying
time.



 


		(d)	*** movies
are offered each month,
*** are Hollywood movies,
*** are Asian
movies and *** are movies from Disney, i.e. *** movies on inbound
flights
and *** on outbound
flights.



 


		(e)	The Hollywood
movies are shown on both mainscreen and personal TV while
Asian movies and Disney movies are shown on personal TV only.



 


		(f)	The Hollywood
movies are updated on bi-weekly basis,
the Asian movies are
updated on monthly basis while the Disney movies are updated
on quarterly basis.



 


		(g)	For the movies shown on
the Japanese routes, they are required
to be duplicated with English
and Japanese audio soundtracks to
cater for the Japanese passengers. Chinese subtitles
are required.



 


		(h)	For Western movies, there
is English soundtrack with
appropriate Chinese subtitles. For
Film Asia movies, there is original language soundtrack
with Chinese and English
subtitles.



 


		2.	Movie Categories



 


		(a)	A
total of *** movies,
*** for inbound flights
and ***
for outbound flights,
are offered each month under the following categories:



 


	
         

        Categories
	 	
         

        Description
	 	
        Quantity

        Required

	Blockbusters	 	
        Showcasing
        all the action from the biggest

        Hollywood blockbusters
	 	***
	Film Asia	 	Get ahead with this fine selection of the latest Asian movies	 	***
	Disney	 	Disney movies for the kids and the whole family	 	***


 


		3.	Specification of Western
Movies



 


		(a)	Please refer
to the Video Channel Line-up for details.



 


		(b)	The quantity shown
below is the total number of programmes required
every month for both inbound
and outbound flights.



 


	 

        Categories
	 	 

        Language
	 	 

        Subtitles
	 	Update

        Frequency
	 	Quantity

    per cycle
	Blockbusters	 	
         

        English
	 	
        Chinese
	 	
        Bi-weekly
	 	
        ***

	
         Disney
	 	
        English
and Cantonese
	 	
        N/A
	 	
        Quarterly
	 	
        ***



(c) Chinese subtitles
can be in Traditional
Chinese or Simplified
Chinese.


 





 



***
Confidential treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 45 of 57



    	 



    

 


Specification
of Western Short Features


 


		1.	Overall Strategy for
Short Features



 


		(a)	In view
of Dragonair's operating network, the majority of the routes have a
flying time of under
2 hours and 40 minutes.
As such, only short
feature programmes
will be
broadcasted on these routes,
resulting in a demand
for a wide variety of quality
short feature programmes in the genres of lifestyle, sports,
documentary, popular sitcoms, business
and entertainment, etc.



 


		(b)	For routes
less than 2 hours flying time,
compilations of 60-minute short feature programmes are
shown on repeating cycles. For routes
between 2 hours and 2 hours 40
minutes, compilations of 80-minute programmes
are shown. For routes
over 2 hours 40 minutes
flying time, movies and
compilations of 135-minute
are shown.



 


		(c)	There is
1 main-screen channel on all classes
of the A321 fleet.
There are 5 PTV channels
on First Class and
1 main-screen channel on Business and Economy
class on the A33R fleet while there are 10
PTV channels on all
classes of the A33A
and A33L fleets.



 


		(d)	All programmes are
updated monthly except for
those featured in the mainscreen that
they are updated bi-weekly and programmes in Disney
& Disney Channel that they are
updated quarterly. The
programming is different
for inbound
and outbound flights.



 


		(e)	For SO-minute
and 135-minute programming blocks, they
are combination
of 30- minute and
60-minute programmes. The number of programmes
selected in a programming block may vary depending on
the actual runtime of the
programmes included. Extra fillers may be
required to fill up an 80-minute
or 135-minute programming block.



 


		(f)	The 60-minute and 80-minute
short feature programming blocks
showing on mainscreen
of the A33R and A321
aircraft are updated bi-weekly and they
will be shown
on the channel of "On Air
TV". The programmes
shown on the main-screen channels cannot be
repeated due to the lack of channel choices as well as the
presence of frequent fliers on our regional flights.



 


		(g)	The language requirements
for Western short feature programmes should include a soundtrack in English with appropriate
Chinese subtitles.
For Asian short feature
programmes, there
should be original languages soundtrack
(Cantonese, Mandarin
or Japanese, etc.)
with English subtitles.



 


		2.	Short Feature
Categories



 


		(a)	A
total of ***
hrs of
programmes are offered each month under the
following categories:



 


	
         

        Categories
	 	
         

        Description
	 	
        Quantity per

        Month

	
        Asian TV

        _(Cantonese)
	 	Lifestyle, travel, and variety shows, documentary, magazine programmes.	 	
         

        ***
        hrs

	Asian TV (Mandarin)	 	
        Lifestyle,
        travel, and variety shows, documentary,

        magazine programmes.
        (Mandarin)
	 	
        -

        ***
        hrs

	
         

        Comedy
	 	
         

        Sitcoms, popular
        shows
	 	*** hrs
	
         

        Discovery
	 	Documentaries about nature, science, history and culture.	 	
         

        ***
        hrs

	
         

        Lifestyle
	 	Technological trends, fashion, fine dinning/cooking, travel, design (e.g. interior, architecture), modern living	 	
         

        ***
        hrs

	
         

        Sports
	 	Profiles, classic matches, documentaries from the world of sport	 	
         

        ***
        hrs

	
         

        Drama
	 	
         

        Dramatic, action,
        romantic TV hits from US & UK
	 	
         

        ***
        hrs



 





 



***
Confidential treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 46 of 57



    	 



    

 


	
        Categories
	 	
        Description
	 	
        Quantity per

        Month

	
        Business
	 	Current affairs, documentaries and profiles from  a business  perspective.	 	
        *** hrs

	
        Ent-Magazine
	 	Gossip, news and interviews from behind the scenes from  Hollywood and beyond. Light-hearted Reality  TV shows and contests.	 	
        *** hrs

	
        Disney

        Channel
	 	Animation and TV hits  for the kids and the whole family (Disney)_	 	
        *** hrs



 

		3.	Specification of Western Short Features



 


		(a)	Please refer to the Video Channel Line-up
for details.



 


		(b)	The quantity shown below is
the total number of programmes required
every month for both inbound and
outbound flights.



 


	
         

        Categories
	 	
         

        Language
	 	
         

        Subtitles
	 	
        Quantity per

        Month

	
         

        Comedy
	 	
         

        English
	 	
         

        Chinese
	 	
         

        *** hrs

	
         

        Discovery
	 	
         

        English
	 	
         

        Chinese
	 	
         

        *** hrs

	
         

        Lifestyle
	 	
         

        English
	 	
         

        Chinese
	 	
         

        ***hrs

	
         

        Sports
	 	
         

        English
	 	
         

        Chinese
	 	
         

        ***hrs

	
         

        Drama
	 	
         

        English
	 	
         

        Chinese
	 	
         

        *** hrs

	
         

        Business
	 	
         

        English
	 	
         

        Chinese
	 	
         

        *** hrs

	
         

        Ent-Magazine
	 	
         

        English
	 	
         

        Chinese
	 	
         

        *** hrs

	 	 	 	 	 	 	 
	
        Disney

        Channel
	 	
        Cantonese
	 	
        N/A
	 	
        *** hrs



		(c)	Chinese subtitles
can be in Traditional
Chinese or Simplified Chinese.



 


Technical Specification
for Western Movies and Western Short Features


 


		(a)	Specification for Broadcast Channels



		•	NTSC system



		•	VHS cassettes



		•	Hi-8 tapes



Stereo broadcast


 





 



*** Confidential treatment requested.


 






    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 47 of 57



    	 



    

 


Specification of Audio


 


		1.	Overall Strategy for Audio



 


		(a)	Tune in to On Air Radio,
Dragonair's hip 16-channel selection of inflight airwaves
for passengers of all cabin classes.
With a wide range
of premium audio entertainment showcasing the
newest and best of East and
West, timeless classics of rock and jazz, stirring
orchestral performances and music from
favourite movies, as well
as soothing sounds and mellow melodies to relax with, the
programming strategy of On Air Radio is simply to
give the greatest choice
of audio entertainment
to Dragonair's passengers.



 


		(b)	On Air Radio's 16-customised audio
channels are available in all cabin classes on
IFE-equipped aircraft. All channels are broadcast in a repeating cycle of 120 minutes. Of
which, 4 channels are presented by DJs.



 


		2.	Radio Channels



 


		(a)	There are a total of 16
customised radio channels available in all
classes on all routes. All channels are broadcast in a
repeating cycle of 120
minutes.



 


	
         

        No.
	 	Channel

name	 	
         

        Description
	 	Update

 frequency	 	
         

        Language

	1	 	Canto Pop	 	Hosted Programme.  Includes  an artist feature segment which showcases three tracks from a single artist, plus a review of their musical history  and sometimes an interview.	 	Monthly	 	Cantonese
	2	 	
        Mandarin

        Pop
	 	
        Hosted programme. The hottest stars
from Hong Kong, Taiwan, Mainland
China and Asia are featured in this jam-packed Mandarin
pop show featuring all the
latest hits!
	 	Monthly	 	Mandarin
	3	 	
        Chinese

        Gold
	 	Hosted programme with the very best Chinese Gold hits including an hour each of Cantonese and Mandarin tracks, to take passengers on a musical journey  throuqh time!	 	Monthly	 	
        Cantonese

        & Mandarin

	4	 	Pop Hits	 	
        Hosted programme.
        An up-tempo

        and fun
        mix of new and forthcoming
        releases plus some more established tracks from the
        international pop charts.
	 	Monthly	 	English
	5	 	
        Classical

        Moods
	 	Popular and familiar  light classics from the great composers, uninterrupted. (No presenter)	 	Monthly	 	N/A
	6	 	Jazz	 	A collection of cool, laid-back jazz. (No presenter)	 	Monthly	 	English
	7	 	Rewind	 	
        A programme of
80's to 90's pop or rock
show. (No presenter)
	 	Monthly	 	English
	8	 	Easy Moods	 	
        A mellow mix of light
contemporary love
songs and ballads from
a diverse group of artists.
(No presenter)
	 	Monthly	 	English
	9	 	Rock	 	A selection of the best rock in the sky as we play new and classic music from some of the world's greatest bands. (No presenter)	 	Monthly	 	English
	10	 	
        All Time

        Hits
	 	
        A programme of
favourite hits
from the 50s,
60s and 70s. (No
presenter)
	 	Monthly	 	English


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 48 of 57



    	 



    

 


	 

        No.
	 	Channel
    name	 	 

        Description
	 	Update
    frequency	 	 

        Language

	11	 	Dancescape	 	Get in the beat  or simply chill out  to these  tunes. (No presenter)	 	Monthly	 	English
	12	 	J-Pop	 	
        The latest
Japanese Pop music
or New Enka. (No presenter)
	 	Monthly	 	Japanese
	13	 	
        Korean

        Music Box
	 	Music from  the movies,
    TV and chart-topping artists of Korea. (No presenter)	 	Bi-monthly	 	Korean
	14	 	Thai Mix	 	A variety of Thai contemporary hits. (No presenter)	 	Bi-monthly	 	Thai
	15	 	
        Taiwanese

        Favourites
	 	A great  mix  of current Taiwanese  or Min Nan song, plus recent  classics. The selection of music  will have huge appeal  to the  target audience. (No presenter)	 	Bi-monthly	 	Taiwanese
	16	 	
        Chinese

        Classical
	 	An enchanting and captivating mix of traditional Chinese classical music played  on traditional instruments, plus  pieces composed by famous Chinese  composers for western orchestras. (No presenter)	 	Bi-monthly	 	N/A


		(b)	Each audio channel is 120 minutes in length and
has approximately 26 tracks.



 


		(c)	All channels, except 'Canto
Pop', 'Mandarin Pop',
'Pop Hits' and
'Chinese Gold',
are not hosted.



 


		(d)	The presenters must be suitable
for Dragonair's demographics, and should not have strong accents.



 


		(e)	Jingles are sometimes used
and are permitted. (f) Presenters usually make reference
to Dragonair.



 


		(g)	A monthly marketing message
(i.e. related to promotions, latest
news, selling of the Dragonair's brand) will
be provided to the presenter on
the 13th of each month, so
that it will be included in
each hosted channel's talks, for programmes to be run 2
months later.



 


		(h)	Presenters may conduct interviews with celebrities
or guests where appropriate.



 


		(i)	Method of recording is flexible
as long as the end
product is suitable
for inflight listening. They can be recorded either on computer
or in studio.



 


		3.	Boarding Music



 


		(a)	Boarding music is
played on all flights during take off and landing for passengers to relax and enjoy.
Dragonair commissioned local musician
Johnny Yim to compose five exclusive tracks
of ambient music representing five unique
aspects of our region's cultures.



 


		(b)	Dragonair commissioned the exclusive composition of the 5 instrumental"
music pieces for use
as ambient music and/or any purposes as it desires.



 


		(c)	Since the Masters
for the boarding music have been produced,
IFP is only required
to update and encode the flashcards and cassettes according
to this schedule.



 


		4.	Technical Specifications



 


		(a)	Broadcast specifications



One set of CDs is required
for each Aircraft in the Dragonair Fleet
and extra sets of CDs
are required as buffer.


		•	All CDs should contain mono tracks and there are no stereo
tracks. On each CD, there should be 4 mono tracks.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 49 of 57



    	 



    

 


		(b)	Boarding Music Specifications



A
combination of PRAM/BGM Reproducers that supports
flashcards and cassette tapes is used across the Dragonair's
fleet of A330, A321 and A320 aircraft. The
models that support flashcards are RDAX7675-51 and RDAX7675-01.
The models that support cassette tapes are RDAX7271KA01,
RDAX7271ZZZZ and RDAX7271CX01.


		•	All flashcards and cassette tapes need to
be encoded by the Panasonic encoder. IFP is required to
update the flashcards and cassette tapes
with the encoded contents



		•	There are 2 storage formats for the Boarding Music.
Below is a summary of the BGM Source and storage
formats of the respective
aircraft:



 


Fleet Boarding
Music Source


 


	A330	 	Flashcard	 	Cassette	 	A320	 	Flashcard	 	Cassette	 	A321	 	Flashcard
	HYA	 	 	 	Yes	 	HSD	 	 	 	Yes	 	HTD	 	Yes
	HYB	 	 	 	Yes	 	HSE	 	 	 	Yes	 	HTE	 	Yes
	HYD	 	 	 	Yes	 	HSF	 	 	 	Yes	 	HTF	 	Yes
	HYE	 	 	 	Yes	 	HSG	 	 	 	Yes	 	HTG	 	Yes
	HYF	 	 	 	Yes	 	HSH	 	 	 	Yes	 	HTH	 	Yes
	HYG	 	Yes	 	 	 	HSI	 	 	 	Yes	 	HTI	 	Yes
	HYH	 	Yes	 	 	 	HSJ	 	 	 	Yes	 	 	 	 
	HYI	 	Yes	 	 	 	HSK	 	Yes	 	 	 	 	 	 
	HYJ	 	Yes	 	 	 	HSL	 	Yes	 	 	 	 	 	 
	HYO	 	Yes	 	 	 	HSM	 	Yes	 	 	 	 	 	 
	HWF	 	Yes	 	 	 	HSN	 	Yes	 	 	 	 	 	 
	HWG	 	Yes	 	 	 	 	 	 	 	 	 	 	 	 
	A330	 	Flashcard	 	Cassette	 	A320	 	Flashcard	 	Cassette	 	A321	 	Flashcard
	HWH	 	Yes	 	 	 	 	 	 	 	 	 	 	 	 
	HWI	 	Yes	 	 	 	 	 	 	 	 	 	 	 	 
	HWJ	 	Yes	 	 	 	 	 	 	 	 	 	 	 	 
	HWK	 	Yes	 	 	 	 	 	 	 	 	 	 	 	 


 


No
of cassette based a/c                12


No of flashcard
based a/c               21


		(c)	Boarding Music Update Schedules
& Process



		•	Cassette tape-based aircraft - In view
of the durability of the cassettes and to pre-empt wear
and tear, cassettes are updated on a bi-monthly basis,
in each ODD month.



		•	Flashcard-based aircraft - As the boarding music is
stored digitally in the system
memory, the boarding music only needs to be
updated whenever the- actual
boarding music is required for change.



		•	Due to the Panasonic IFE systems'
proprietary encoding requirements,
the boarding music update
for flashcards and cassettes must be performed at a facility equipped with the relevant
Panasonic encoder hardware and software.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 50 of 57



    	 



    

 


SCHEDULE 2- PROGRAMMING GUIDELINES


 


For Video Programmes


 


		1.	For Western Movies, wherever
possible, the threatical (unedited)
version is preferred.



 


		2.	For Western Short Features, only episode-based
programmes should be
considered and TV serial should not be selected as long
as programme is offered as
broadcast channels instead of AVOD.



 


		3.	Programmes selected must
not contain the following scenes or elements,
or the related scenes
or elements must be edited out :



 


		3.1	Full frontal nudity



 


		3.2	Derogatory portrayal of China or
Chinese citizens



 


		3.3	Possession I Satanism



 


		3.4	Active promotion of other airlines



 


		3.5	Explicit sex scene, including
special sexual orientation



 


		3.6	Extremely strong language
and swearing



 


		3.7	Extensive nudity



 


		3.8	Extreme violence, including
extreme scenes of blood and
gore



 


		4.	Attention must be brought to Cathay if programmes contain
the following elements:



 


		4.1	Scenes or reference to aircraft
crashes, hijacks, disasters, and hostage-taking



 


		4.2	Controversial political issues, including criticism
of Communist doctrine
or Government



 


		4.3	Religious content, including
scenes disrespectful to sacred
animals



 


		4.4	Containing explicit reference
to Cathay Pacific
or other airlines



 


		5.	For Western Movies, movie
rating (e.g. R, PG-13) from terrestrial release
must be provided for reference. Attention
must be brought to
the Airline
if any NC-17 is recommended.



 


		6.	Applicable warnings and intensity
levels must be indicated for each movie
during title selection
recommendation:



 


		6.1	Warnings



 


A: Strong
adult themes                     -
Including drug use, criminal acts, etc.
C: Aircraft incidents


 


L: Strong
language


 


N: Nudity


 


P: Political themes


 


R: Religious content


 


S: Sexual
content


 


V: Violence, blood
or gore


 


		6.2	Intensity Levels



 


		•	The Intensity
levels of each
warning should be indicated
by High (H),
Medium (M), or Low (L).



 


		•	e.g. For
a TV programme with a high
intensity of strong language,
medium violence, and low
sexual content, the
warnings should be
indicated as followed:
L (H), V (M), S
(L)



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 51 of 57



    	 



    

 


For Audio
Programmes


 


		1.	Audio content must not
contain:



 


		1.1	Offensive swearing



 


		1.2	Religious criticism



 


		1.3	Controversial political issues



 


		1.4	Interviews should not
be overtly promotional



 


		1.5	Reference to aircraft disasters or
crashes



 


		1.6	Promotion of competitive airlines



 


		1.7	Derogatory portrayal of
China or Chinese citizens



 


		1.8	Presenters or interviewees with language and dialect, which
                                                                                                    may be hard to follow,
                                                                                                    for example, Irish, Scottish, Afro-Caribbean.



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 52 of 57



    	 



    

 


SCHEDULE 3 -CONTACT AND DELIVERY DETAILS


 


Contact Information of the Airline:


 


8/F North
Tower


Cathay Pacific
City


8 Scenic
Road


Hong Kong
International Airport


Lantau, Hong Kong


 


Contact Person:


Mr. Clement Au


Manager Inflight Communication
and Entertainment


		Tel:	(852) 2747 5148



		Fax:	(852) 2141 5148



		EmaiI:	Clement_au@cathaypacific.com



 


Ms.
Eva Chan


Assistant Purchasing Manager -
Marketing


		Tel:	(852) 2747 4187



		Fax:	(852) 21414187



		Email:	eva_chan@cathaypacific.com



 


Contact Information
of IFP:


 


15 Stukeley
Street


London WC2B


5LT
United 


Kingdom


 


Contact Person:


Ms.
Janet Winstanley 


Client Services Manager



		Tel:	(44) 20 7400 0733



		Fax:	(44) 20 7400 0745



		Email:	janet.winstanley@inflightproductions.com



 


Delivery Address for Promotional Materials:


 


ACP Magazines
Asia Limited


Suite 604-605


625 King's Road


North Point,
Island East


Hong Kong


 


Contact Person:



Elisabeth Attwood



Entertainment editor


		Tel:	(852) 3921 7051



		Fax:	(852) 39217099



		Email:	eattwood@acpmagazines.com.hk



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 53 of 57



    	 



    

 


Delivery Address for Video Cassettes:


 


For Cathay:


Cathay Pacific
Airways


C/0 HAECO


2/F, 80 South Perimeter Road


Hong
Kong International Airport


Lantau, Hong Kong


 


Contact Person:


Mr. Frankie Leung


		Tel:	(852) 2787 6336



		Fax:	(852) 2767 6852



		Email:	ow.leung@haeco.com



 


For Dragonair:


Dragonair


C/O Cabin Services of


China Aircraft Services
Ltd.


4N505 Passenger Terminal
Building


1Cheong Hong Road


Hong Kong
International Airport


Lantau,
Hong Kong


 


Contact Person:


Mr. Patrick Chan


		Tel:	(852) 2261 2311



		Fax:	(852) 2261 2312



		Email:	patrick.chan@casl.com.hk



 


Delivery Address for Audio COs:


 


For Cathay:


Cathay Pacific Airways


C/0 HAECO


2/F, 80 South Perimeter Road


Hong
Kong International Airport


Lantau, Hong Kong


 


Contact Person:


Mr. Frankie
Leung


		Tel:	(852) 2787
6336



		Fax:	(852) 2767 6852



		Email:	ow.leung@haeco.com



 


For Dragonair:


Cathay Pacific Airways


C/0 HAECO


2/F,
80 South Perimeter Road


Hong Kong International
Airport


Lantau, Hong Kong


 


Contact Person:



Mr. Victor Kwan


		Tel:	(852) 2767 6776



		Email:	victor.kwan@haeco.com



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 54 of 57



    	 



    

 


Delivery Address for Boarding
Music Flashcard:


 


Cathay Pacific Airways


Product Department


8/F North Tower


Cathay City


8 Scenic
Road


Hong Kong International Airport


Lantau, Hong Kong


 


For Cathay:


Contact Person:


Ms. Mimi Chan


		Tel:	(852) 2747 5345



		Fax:	(852) 2141 5345



		Email:	mimi_chan@cathaypacific.com



 


For Dragonair: 


Contact Person


Ms. Mun
Wong


		Tel:	(852) 2747 4133



		Fax:	(852) 2141 4133



		Email:	siu_mun_wong@cathaypacific.com



 


Delivery Address for Digital Media for Media
Integration for Cathay:


 


Inflight Productions Limited


15 Stukeley Street


London WC2B


SLT United


Kingdom


 


Contact Person:


Mr.
Marc Fegredo


AVOD Coordinator


		Tel:	(44)
207 400 8582



		Fax:	(44) 207 400 0707



		Email:	marc.fegredo@inflightproductions.com



 


Delivery Address for the Airline to return
the cassette of Western Movies for destruction:


 


Inflight Productions Inc


Suite 201,615
N Nash St. 


El Segundo,
CA 90245


USA


 


Contact Person:


Ms. Sharon Engelenburg, Operations Manager


		Tel:	(1) 310 414 6900 ext 114



		Email:	sharon.engelenburg@inflightproductions.com



 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 55 of 57



    	 



    

 


SCHEDULE 4- BUDGET FOR 2007


 


(To be inserted)


 


***


 





 



 


***
Confidential treatment requested.


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 56 of 57



    	 



    

 


SCHEDULE 5- KEY PERFORMANCE INDICATORS


 


(To be inserted)


 




    	CX and KA Western Programming Agreement - IFP Final 26JUN08	Page 57 of 57



    	 



    

 


Key Performance
Indicators - IFP
Production Services


 


Evaluation Period: Overview


 


The Key Performance
Indicators are a set of recognized parameters by which CX measures the service
providers performance


 


Frequency


 


The basis
of the Key performance indicators outlined in this document will be
completed every 6 months as part of the Supplier Performance
Evaluation Process. The reviews are likely to take place in
July and January.


 


The KPI's
will be evaluated on an annual basis to ensure they accurately
reflect appropriate parameters for measurement.


 


Scoring Panel


In
response to the evaluation process key members of CX who interface with
the service provider on a regular basis will
complete the evaluation
sheet judging the service provider against each of the
6 constructs outlined and will give a score
ranging from 1 - 5 as detailed below.


 


Scoring Mechanism


Each person
scoring the performance of the service provider will
enter a "1" under
the appropriate score, I.e. 5,
4, 3,
2, or 1 for each
statement. The KPI spreadsheet will automatically calculate
the overall scores.


 


	Totally Satisfied/Far exceeds expectations	5
	Mostly Satisfied/Always meets but at times exceeds expectations	4
	Somewhat Satisfied/meets expectations	3
	Dissatisfied/below  expectations	2
	Fail	1


 


Comments will
be provided during the review process for each
of the 6 sections.
Where a "1" or
"2" has been
awarded, specific comments related to that particular
score will be
detailed and
shared with the service provider.


 


	Schedule 5a - Key Performance Indicators 	Page 1 of 9




 




    	 



    	 



    

 


360
Degree Feedback


 


Supplier:
Inflight Productions Limited


 


Duration:
 _______________


 


The
aim of 360 degree feedback
is for the supplier
to provide feedback on Cathay Pacific's
performance. It should focus on
ways in which an improvement
in Cathay's
way of working could
help the supplier perform the role for which
they have been appointed
more efficiently.
The feedback is meant
to be constructive and
will help identify areas for Cathay to focus in order to
improve the working
relationship and efficiency
of the supplier.


 


Scores: 


 


	5:	Excellent
	4:	Good
	3:	Average
	2:	Development Needed
	1:	Poor I Disappointing


 


Please
underline and bold the score for the evaluation period,
e.g. 2.


 


	 	 	 
	1. Communication	 	SCORE
	 	 	 
	•    Lines of communication are clearly defined and effective (i.e.  work in practice)	 	1 2 3 4 5
	 	 	 
	•    Levels of authority and decision making  power are clearly understood.	 	12 3 4 5
	 	 	 
	•    Role responsibilities within  the IFE team and APD team are clearly set out and defined.  (Does confusion arise as to who performs  which role?)	 	1 2 3 4 5
	 	 	 
	•    Important information told to one member  of CX is disseminated  to the correct people.	 	1 2 3 4 5
	 	 	 
	•    A coherent  message is given from all contact points within CX (are there conflicting  messages?)	 	1 2 3 4 5
	 	 	 
	•    Deadlines and timescales are clearly communicated	 	1 2 3 4 5
	 	 	 
	Overall Score	 	12345
	 	 	 
	Comments	 	 
	 	 	 
	2. Personnel and  working relationship	 	SCORE
	 	 	 
	•     People are quick to respond to queries  and emails.	 	1 2 3 4 5
	 	 	 
	•     Approvals on programming suggestions  are timely.	 	12345
	 	 	 
	•     Cx personnel are easy to deal with, professional, yet helpful  and approachable.	 	12345
	 	 	 
	•     Cx personnel have adequate knowledge  of IFE technical issues required  to perform  their role effectively?	 	1 2345


 


Schedule 5b - IFP
Feedback to Cathay


 




    	 



    	 



    

 


	Overall Score	 	12345
	 	 	 
	Comments	 	 
	 	 	 
	5. Information sharing	 	SCORE
	 	 	 
	•     The
    format  and analysis of survey  results and AVOD usage data is easy to understand  and well presented.	 	1 2 3 4 5
	 	 	 
	•     CX
    provides  regular  updates  with regards information related to Cathay, such as new routes, new initiatives
    etc.	 	1 2 3 4 5
	 	 	 
	•     Cx
    provides correct  duplication volumes  in sufficient time.	 	1 2 3 4 5
	 	 	 
	Overall Score	 	12345
	 	 	 
	Comments	 	 
	 	 	 
	6. Third Parties	 	SCORE
	 	 	 
	•     Cx
    helps to ensure  that  third  party  suppliers  integrate well.	 	1 2 3 4 5
	 	 	 
	•     Cx
    understands the challenges of working  with other third  parties.	 	1 2 3 4 5
	 	 	 
	•    Cx
    is effective at coordinating themes and ideas among all IFE suppliers.	 	1 2 3 4 5
	 	 	 
	•    Cx
    helps to ensure that  third  party  suppliers  meet  their  deadlines.	 	1 2 3 4 5
	 	 	 
	Overall Score	 	12345
	 	 	 
	Summary	 	 


 


Schedule 5b -
IFP Feedback to Cathay


 




    	 



    	 



    




 


AGREEMENT BETWEEN


CATHAY PACIFIC
AIRWAYS LIMITED, HONG KONG DRAGON AIRLINES
LIMITED AND INFLIGHT PRODUCTIONS
LIMITED


 


For the Supply
of Programming and Production Services for Inflight Entertainment (Western Programmes)


 


AGREEMENT AMENDMENT


 


This
AGREEMENT AMENDMENT ("Amendment") is dated 21st
February 2012 and Is made between Cathay Pacific Airways Limited
("Cathay"), Hong Kong Dragon Airlines
Limited ("Dragonair") and Infilght
Productions Limited ("IFP") to amend the AGREEMENT
("Agreement") which was made on
26th June 2008,
as amended by Agreement
Amendment which was
made on 15th July 2009 and
the extension notice
letter which was made on 30th September
2011.


 


RECITALS


 


The
parties agree to extend the Term
of the Agreement for
eighteen (18) months
and the Term will be further renewed
for another one (1) year subject
to Cathay's/Dragonalr's
discretion.


 


The
definitions in the Agreement are incorporated by reference into this
Amendment, and shall be deemed to have the same meanings
as those ascribed to them In the Agreement unless
otherwise set forth herein.


  


NOW, THEREFORE,
the parties agree this Agreement Amendment to supersede
the previous extension letter dated 30th September 2011 and
to amend the Agreement as follows:


 


		1.	At the end of
the Term of the Agreement at
31st December 2011,
the Term shall be
extended for eighteen (18) months till
30th June 2013. Subject to
written notice from Cathay to IFP
at least three (3) months prior
to the expiry of the
Agreement, the Agreement
shall be further extended
for one (1) year till 3oth June 2014.



 


		2.	The Regional
                                                                                                                                                             AVOD Movie License rates
                                                                                                                                                             shall be reduced starting from *** till ***,
                                                                                                                                                             as per the commercial proposal sent from IFP to
                                                                                                                                                             Cathay on ***.



 





	Distributor	 	
        LH/PTV Rate

        (average over
        3 months)
	 	
        Regional AVOD Rate

        (average over
        3 months)

	Disney	 	***	 	***
	Paramount	 	***	 	***
	Sony	 	***	 	***
	Universal	 	***	 	***
	Twentieth Century Fox	 	***	 	***
	Warner  Brothers	 	***	 	***
	Cincsky	 	***	 	***
	ElM	 	***	 	***
	Jaguar	 	***	 	***
	TSI	 	***	 	***







 





		3.	The
following Service Costs shall be amended starting
from ***
till ***
as stated
in ***
commercial proposal:



 


		3.1	The
Recall Fees shall
be covered by ***
for the
New Release
titles booked
by Cathay
within the first
3 months of release.



 


		3.2	The
unit rate for
VHS Duplication Cost
shall be aligned to ***
for all
lengths up
to 150 minutes at the Lab. Aero
for both Cathay and
Dragonair:



  





	 	 	VHS Tape
	135-minute	 	***
	90- minute	 	***
	60-minute	 	***







 





 



 


*** Confidential treatment requested.


 




    	 



    	 



    

 


		3.3	The
unit rate for V8 Duplication Cost shall be aligned to
*** at
Lab. Aero for Dragonair:



 


	 	 	V8 Tape
	135-mlnute	 	***
	90-minute	 	***




 


		3.4	The
unit rate for BGM Flashcard Duplication Cost shall
be reduced from *** for
Dragonair.



 


		4.	All other terms and conditions
of the Agreement shall remain In full force and effect.



  


IN WITNESS whereof the Parties
hereto have caused this Agreement to be duly executed by
their authorised representatives the day and year first above written.


 


	Signed  for	 	Witnessed  by:
	CATHAY PACIFIC AIRWAYS LTD. by:	 	 
	 	 	 
	/s/ Gloria Chow-Vanderwell	 	/s/ Penny Chan
	Name: Gloria Chow-Vanderwell	 	Name: Penny Chan
	Job Title: Product Manager	 	Job Title: Assistant Purchasing Manager
	Cathay Pacific Airways Ltd.	 	Cathay Pacific Airways Ltd.
	 	 	 
	Date: 2/28/2012	 	Date: 2/28/2012
	 	 	 
	Signed  for	 	Witnessed  by:
	HONG KONG DRAGON AIRLINES LTD. 	 	 
	by its duly authorized agent:	 	 
	 	 	 
	/s/ Gloria Chow-Vanderwell	 	/s/ Penny Chan
	Name: Gloria Chow-Vanderwell	 	Name: Penny Chan
	Job Title: Product Manager	 	Job Title: Assistant Purchasing Manager
	Cathay Pacific Airways Ltd.	 	Cathay Pacific Airways Ltd.
	 	 	 
	Date: 2/18/2012	 	Date: 2/28/2012
	 	 	 
	Signed  for	 	Witnessed  by:
	INFLIGHT PRODUCTIONS LTD. 	 	 
	by:	 	 
	 	 	 
	/s/ Roberts G. Hamler	 	/s/ Suzi Hennessy
	Name: Roberts G. Hamler	 	Name: Suzi Hennessy
	Job Title: CEO	 	Job Title: VP Operations
	Inflight Productions Limited	 	Inflight Productions Limited 
	 	 	 
	Date: 2/22/2012	 	Date: 2/22/2012


 





 



 


*** Confidential treatment requested.