Document:

Exhibit 10.24

 

CONFIDENTIAL TREATMENT REQUESTED: INFORMATION FOR WHICH CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED IS OMITTED AND MARKED WITH “**”. AN UNREDACTED
VERSION OF THIS DOCUMENT HAS ALSO BEEN PROVIDED TO THE SECURITIES AND EXCHANGE
COMMISSION.

 

CONTRACT FOR SERVICES

 

THIS
AGREEMENT, dated as of June 25, 2007 (the “Effective Date”), together with
the schedules, appendices, attachments and exhibits, if any (collectively, the
“Agreement”), between NHL Interactive CyberEnterprises, LLC, a Delaware limited
liability company having its principal office at 1251 Avenue of the Americas,
New York, NY 10020 (“the NHL”) and NeuLion, Inc., having its principal
place of business at 1600 Old Country Road, Suite 101, Plainview, New York
11803, United States (“NeuLion”), each of the NHL and NeuLion being a “Party”.

 

W I T N E S S
E T H:

 

WHEREAS, the
NHL desires to engage NeuLion to build and deliver an online multimedia
streaming service as described in this Agreement; and

 

WHEREAS,
NeuLion desires to build and deliver an online multimedia streaming service as
described in this Agreement.

 

NOW,
THEREFORE, in consideration of the premises and mutual covenants contained in
this Agreement, the Parties agree as follows:

 

1.             Term.  Unless earlier terminated as otherwise provided
for herein, the term of this Agreement shall commence on the Effective Date and
expire on September 30, 2010 (the “Initial Term”), and shall renew
thereafter for subsequent one (1) year periods (each a “Renewal Term”) upon
mutual agreement of the Parties no less than four (4) months prior to the
expiration of the then-current term (the Initial Term and all Renewal Terms are
referred to collectively as the “Term”).

 

2.             Services; Acceptance; Project
Meetings.  (a) The services to
be provided by NeuLion under this Agreement shall consist of the setup and back
office operation of an online multimedia streaming service (the “Service”) as
more fully described in Exhibit A hereto, utilizing audio, video,
photographic, statistical and other content (“Content”) provided by the
NHL.  NeuLion shall furnish the Service
in accordance with the service levels set forth in Exhibit C hereto (the
“Service Levels”).

 

(b)           The NHL shall have a reasonable
period of time to test each Service element and other deliverable furnished by
NeuLion hereunder (including, without limitation, the Video Player (as defined
in Exhibit A) and each of its particular implementations, as well as
NeuLion’s geofiltering/gating mechanisms) (collectively, the “Deliverables”) to
determine whether they 

 

1

 

meet the specifications set
forth in this Agreement or otherwise agreed by the Parties, and NeuLion shall
promptly correct any deficiencies identified by the NHL in this regard.

 

(c)           Project team leaders from the NHL and
NeuLion shall meet regularly, but no less frequently than weekly, during the
Service development and implementation process, in order to prioritize tasks,
discuss changes and scheduling, identify problems and resolutions, and otherwise
coordinate and cooperate in connection with the development and implementation
of the Service and the furnishing of all Deliverables.

 

3.             Consideration.  (a)  The NHL shall pay to NeuLion the
fees set forth in Exhibit B hereto as consideration for the services
provided pursuant to Section 2 above. 
All payments (other than amounts disputed in good faith) shall be due
thirty (30) days from the date of the NHL’s receipt of NeuLion’s invoice.  The Parties shall work in good faith to
expeditiously resolve any disputed portions of NeuLion’s invoices.

 

(b)           NeuLion shall maintain complete and
accurate books and records, in accordance with generally accepted industry
practices, to demonstrate full compliance with all the terms and conditions of
this Agreement and to substantiate NeuLion’s charges and/or expenses
hereunder.  NeuLion shall retain such
records for a period of at least two (2) years from the date of final
payment hereunder.  The NHL or its
designated representative(s) shall have access to such records for
purposes of audit during normal business hours upon reasonable prior notice to
NeuLion.  In the event any such audit
reveals an overpayment by the NHL, *****************

**************************.

 

4.             Independent Contractor.  NeuLion is an independent contractor of the
NHL.  Accordingly, no Party shall, nor
shall any officer, director, employee, servant, agent or independent contractor
of either Party (i) be deemed an employee of the other Party, (ii) commit
the other Party to any obligation, or (iii) hold itself, himself, or
herself out as an employee of the other Party or a Person with the authority to
commit the other Party to any obligation. 
As used in this Agreement the word “Person” means any individual person,
entity (including partnerships, corporations and limited liability companies),
and government or political subdivision thereof (including agencies, bureaus,
offices and departments thereof).

 

5.             Compliance With Law.  Both the NHL and NeuLion shall comply with
any and all applicable Federal, State and local laws, rules and
regulations (collectively, “Laws”) in connection with their respective
performance under this Agreement.

 

6.             NeuLion Works and Intellectual
Property Rights.  (a)  The NHL
understands and agrees that NeuLion shall utilize its (and/or its affiliates’)
proprietary intellectual property (including but not limited to patents,
trademarks, know how and business models) in the development and delivery of
the Service provided for herein (“NeuLion iPTV Platform”).  Accordingly, any transformations,
modifications, enhancements, expansions or adaptations of NeuLion iPTV Platform
developed by NeuLion in delivery of the Service provided for herein
(“Derivative Works”), and any and all intellectual property rights therein
contained (including but not limited to patents, trademarks, know how and
business models) shall be owned by

 

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NeuLion, and, in further
consideration for the rights granted herein to the NHL, the NHL hereby assigns
to NeuLion any and all rights, title and interest, including, without
limitation, copyrights, trade secrets and proprietary rights, to the Derivative
Works developed by NeuLion hereunder. 
The Derivative Works shall not be deemed to be “works made for hire” under
the federal copyright laws.  The NHL
agrees to give NeuLion reasonable assistance to perfect such assignment of such
rights, title and interest.

 

(b)           Notwithstanding the foregoing, the
NHL shall retain all rights, and NeuLion shall not have any ownership interest,
in materials developed by the NHL in connection with the Service (if any), such
as applications and/or code developed by the NHL that enable the NeuLion iPTV
Platform to retrieve statistical information from the NHL’s real-time scoring
system (“NHL Developments”).  Moreover,
to the extent NeuLion is involved in the creation or production of any Content
hereunder, such Content shall be deemed a “work made for hire” under the
federal copyright laws and shall be owned by the NHL.  To this end, in further consideration for the
amounts paid to NeuLion hereunder, NeuLion hereby assigns to the NHL any and
all rights, title and interest, including, without limitation, copyrights,
trade secrets and proprietary rights, in and to the NHL Developments and
Content that would otherwise vest in NeuLion, and NeuLion agrees to give the
NHL reasonable assistance to perfect such assignment of such rights, title and
interest.

 

7.             Infringement.  NeuLion warrants and represents that neither
the Service, the Derivative Works nor the NeuLion iPTV Platform infringes upon
or constitutes a misappropriation of any copyright, trademark, patent, trade
secret or other proprietary right of any third party.  Each Party will indemnify, defend and hold
harmless the other Party, and the other Party’s affiliates, officers, employees
and agents, from and against all third party claims against, and any related
damages, claims, expenses (including reasonable attorney’s fees), judgments,
liabilities and costs (“Losses”), which such Party may suffer or incur relating
to any claim or action alleging that (in the case of indemnification by
NeuLion) the Service, the Derivative Works or the NeuLion iPTV Platform or (in
the case of indemnification by the NHL) the Content infringe any copyright,
trade secret, patent right of design, or other third party intellectual
property right.  In the event of any
third party claim against the NHL in respect of the NeuLion iPTV Platform,
NeuLion, at its option, may (i) obtain the right to use the NeuLion iPTV
Platform without obligation on the part of the NHL to the owner of the
allegedly infringed intellectual property, (ii) modify the NeuLion iPTV
Platform, without materially diminishing the functionality or performance,
thereof, to become non-infringing at NeuLion’s sole expense or, after using its
best efforts to achieve either of the foregoing options, (iii) discontinue
the use of infringing NeuLion iPTV Platform components and provide the NHL with
a pro rated refund of any fees pre-paid in connection with such components (the
allocation of which shall be agreed by the Parties in good faith).  In the event of any third party claim against
NeuLion in respect of the Content, the NHL, at its option, may (i) obtain
the right to use the Content without obligation on the part of NeuLion to the
owner of the allegedly infringed intellectual property, or (ii) discontinue
the use of infringing Content.  If,
pursuant to the foregoing, NeuLion elects to discontinue a material feature or
component of the NeuLion iPTV Platform, the NHL shall have the right, upon 45
days notice, to terminate this Agreement without liability to NeuLion.

 

3

 

8.             Limited Service Warranty.  NeuLion warrants that the Service will
operate according to the specifications set forth in the Exhibits hereto or
otherwise agreed by the Parties.  If it
is determined that the Service does not operate according to such
specifications, then except as required by applicable Law, NeuLion’s only
responsibility will be to use its best efforts, consistent with industry
standards, to cure the defect at its own expense.  Moreover, NeuLion warrants that it shall use
commercially reasonable efforts to avoid the introduction of virus, lockup
program, or other malicious or disabling code or device into the NeuLion iPTV
Platform and the applications and content managed by NeuLion hereunder.  EXCEPT AS SET FORTH HEREIN, NO OTHER
WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, THE
IMPLIED WARRANTIES OF MERCHANTABILTY AND FITNESS FOR A PARTICULAR PURPOSE, ARE
MADE BY EITHER PARTY.  IN NO EVENT WILL
EITHER PARTY BE LIABLE TO THE OTHER PARTYFOR ANY INDIRECT, INCIDENTAL, SPECIAL
OR CONSEQUENTIAL DAMAGES BASED ON CONTRACT, TORT OR OTHER LEGAL THEORY, WHICH MAY ARISE
HEREUNDER OR FROM THE USE OR OPERATION OF THE SERVICE.

 

9.             Indemnification; Defense;
Cooperation.  (a)  Each Party
shall be responsible for and shall indemnify, defend and hold harmless the
other Party and its affiliates, officers, employees, and agents (the “Indemnified
Parties”) from and against any and all Losses, arising out of or in
connection with any acts, omissions or breaches of this Agreement by the
indemnified Party, regardless of whether due to negligence, fault, or default,
including Losses in connection with any threatened investigation, litigation or
other proceeding or preparing a defense to or prosecuting the same; provided,
however, that the indemnifying Party shall not be responsible for that portion,
if any, of a Loss that is caused by the negligence, fault or default of the
other Party.

 

(b)           Each Party shall, upon the other
Party’s demand, promptly and diligently defend, at the Party’s own risk and
expense, any and all suits, actions, or proceedings which may be brought or
instituted against one or more Indemnified Parties for which the Party is
responsible under this Section, and, further to the Party’s indemnification
obligations, the Party shall pay and satisfy any judgment, decree, loss or
settlement in connection therewith.

 

(c)           Each Party shall cooperate with the
other Party in connection with the investigation, defense or prosecution of any
action, suit or proceeding in connection with this Agreement.

 

(d)           The provisions of Sections 7, 9, and
13 to 19 shall survive the termination of this Agreement.

 

10.           Assignment; Amendment; Waiver;
Subcontracting.  (a)  Neither
Party may assign, transfer or otherwise convey this Agreement nor any of its
rights and obligations under this Agreement, including by operation of law,
without the prior written consent of the other Party, which consent shall not
be unreasonably withheld.

 

4

 

(b)           This Agreement and the rights and
obligations hereunder may not be in whole or part (i) amended, (ii) waived,
or (iii) subcontracted, without the prior written consent of the Party
against whom enforcement of such action is sought.  Any purported modification without such prior
written consent shall be null and void. 
The failure of a Party to assert any of its rights under this Agreement,
including the right to demand strict performance, shall not constitute a waiver
of such rights.

 

11.           Termination.  (a)  This Agreement may be terminated (i)
in the event of a breach of this Agreement that has gone uncured for a period
fifteen (15) days after written notice of such breach has been given, (ii)
immediately upon the insolvency of or the filing of a petition of bankruptcy by
a Party, (iii) upon mutual written agreement of the Parties, (iv) by a Party in
the event that Force Majeure Events prevent the other Party from performing its
obligations hereunder for a period of twenty (20) days or more, and (v) in
accordance with any other provisions of this Agreement expressly addressing
termination.

 

(b)           In addition, the NHL shall have the
right to ********************************************************* **************************.

 

12.           Confidentiality.  “Confidential Information” shall include: (i) all
prices, rates and other financial information related to the Services, (ii) all
information relating to the customers of either Party, including customer
lists, and (iii) all information one Party provides to the other which is
clearly identified as confidential or proprietary.  Confidential Information disclosed by either
Party to the other shall be held by the recipient in confidence and not: (a) used
by the recipient for personal advantage of any kind, or (b) made available
for third parties to use.  Each Party
will direct its employees, contractors, consultants and representatives who
have access to any Confidential Information to comply with all of the terms of
this Section.  The following information
shall not be Confidential Information if: (i) it is or becomes available
to the public through no wrongful act of the receiving Party; (ii) it is
already in the possession of the receiving Party and not subject to any
agreement of confidence between the Parties; (iii) it is received from a
third Party without restriction for the benefit of the disclosing Party and
without breach of this Agreement; (iv) it is independently developed by
the receiving Party; (v) it is disclosed pursuant to a requirement of a
duly empowered government agency or a court of competent jurisdiction after due
notice and an adequate opportunity to intervene is given to the disclosing
Party unless such notice is prohibited. 
Upon termination or expiration of this Agreement, the receiving Party shall
at the disclosing Party’s direction, either return or destroy all of the
disclosing Party’s Confidential Information and so certify in writing.  The obligations of this provision will
survive for five (5) years after any termination or expiration of this
Agreement.

 

13.           No Third Party Beneficiaries.  This Agreement is entered solely by and
between the Parties and shall not be deemed to create any rights in or
obligations to any third parties.

 

14.           Force Majeure.  Neither Party shall be liable for failure to
fulfill its obligations under this Agreement if that failure is caused,
directly or indirectly, by flood, communications failure, extreme weather,
fire, mud slide, earthquake, or other natural calamity or act of God,
interruption in water, electricity, riots, civil disorders, rebellions or
revolutions, acts of governmental agencies, quarantines, embargoes, malicious
acts of third parties, acts of terrorism, labor disputes affecting vendors or
subcontractors and for which the Party claiming force majeure is not
responsible, or any other similar cause beyond the reasonable control of that
Party (collectively, “Force Majeure Events”).

 

5

 

15.           Consent to Jurisdiction and Venue;
Governing Law.  Unless otherwise
specified in this Agreement or required by Law, exclusive original jurisdiction
for all claims or actions with respect to this Agreement shall be in a State or
Federal Court in Nassau County in New York State and the Parties expressly
waive any objections to the same on any grounds, including venue and forum non
conveniens.  This Agreement is intended
as a contract under, and shall be governed and construed in accordance with,
the Laws of New York State, without regard to the conflict of laws provisions thereof.

 

16.           Notices.  Any notice, request, demand or other
communication required to be given or made in connection with this Agreement
shall be (a) in writing, (b) delivered or sent (i) by hand
delivery, evidenced by a signed, dated receipt, (ii) postage prepaid via
certified mail, return receipt requested, or (iii) overnight delivery via
a nationally recognized courier service, (c) deemed given or made on the
date three (3) business days after it is mailed or one (1) business
day after it is released to a courier service, as applicable, if addressed to
the President or Chief Executive Officer of the Party at the address specified
above for the Party, or in each case to such other persons or addresses as
shall be designated by written notice.

 

17.           All Legal Provisions Deemed
Included; Severability; Supremacy.  (a) Every
provision required by Law to be inserted into or referenced by this Agreement
is intended to be a part of this Agreement. 
If any such provision is not inserted or referenced or is not inserted
or referenced in correct form then (i) such provision shall be deemed
inserted into or referenced by this Agreement for purposes of interpretation
and (ii) upon the application of either Party this Agreement shall be
formally amended to comply strictly with the Law, without prejudice to the
rights of either Party.

 

(b)           In the event that any provision of
this Agreement shall be held to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.

 

(c)           Unless the application of this
subsection will cause a provision required by Law to be excluded from this
Agreement, in the event of an actual conflict between the terms and conditions
set forth above the signature page to this Agreement and those contained
in any schedule, exhibit, appendix, or attachment to this Agreement, the terms
and conditions set forth above the signature page shall control.  To the extent possible, all the terms of this
Agreement should be read together as not conflicting.

 

18.           Section and Other Headings.  The section and other headings contained in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement.

 

19.           Entire Agreement.  This Agreement represents the full and entire
understanding and agreement between the Parties with regard to the subject
matter hereof and supersedes all prior agreements (whether written or oral) of
the Parties relating to the subject matter of this Agreement.

 

6

 

20.           Publicity.  Further, the Parties will work together on
the specific messaging of any press release regarding the relationship between
NeuLion and the NHL.  Each Party will
give the other appropriate advance notice and opportunity to review any
publicity materials before the actual release, and will not issue any release
or other publicity that mentions the other without the prior approval of that
Party.

 

IN WITNESS
WHEREOF, the Parties have executed this Agreement as of the date first above
written.

 

 

	
  NeuLion, Inc.

  	
   

  	
  NHL Interactive CyberEnterprises, LLC

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Ronald M.E. Nunn

  	
   

  	
  By:

  	
  /s/ Keith Ritter

  
	
   

  	
  (Authorized Signature)

  	
   

  	
   

  	
  (Authorized
  Signature)

  
	
   

  	
   

  	
   

  
	
  Ronald M.E. Nunn

  	
   

  	
  Keith Ritter

  
	
  Type or
  Print Name of Person Signing

  	
   

  	
  Type or
  Print Name of Person Signing

  
	
   

  	
   

  	
   

  
	
  EVP, Business Operations

  	
   

  	
  President

  
	
  Title

  	
   

  	
  Title

  
	
   

  	
   

  	
   

  
	
  06-27-2007

  	
   

  	
  June 25, 2007

  
	
  Date

  	
   

  	
  Date

  

 

7

 

EXHIBIT A

 

NEULION
PROVIDED SERVICES

 

NeuLion shall provide the
following services for the setup and back office operations of the Service,
provided that the NHL obtains all requisite legal and regulatory approvals for
any locality.  These services shall
include the utilization of the NeuLion iPTV Platform.  The specific services to be provided by
NeuLion are:

 

·                  Base Services —
NeuLion shall provide the process, technology and ongoing personnel services to
deliver the following “Base Services” to the NHL:

 

1.     Video player template design and implementation of
a video player based on the template for NHL.com and for each Member Club;

2.     Content management and storage for up to 51,000
hours of Content;

3.     Live and on-demand Content streaming, with digital
rights management, URL encryption (as applicable), ad server integration and geo-targeting;

4.     Subscriber management, registration, billing and
payment processing;

5.     Syndication; and,

6.     Reporting and tracking.

 

·                  Center Ice Services
— NeuLion shall provide the process, technology and ongoing personnel services
to deliver the following “Center Ice Services” to the NHL:

 

1.     Downlink and transcoding of live game feeds; and

2.     Live streaming of home team television feed, away
team television feed, home team radio feed and away team radio feed for 1,340
games per season.

3.     The NHL shall have the exclusive right to set
pricing for the NHL Center Ice Online live video offering, and any other
Content offering managed by NeuLion hereunder.

4.     NeuLion shall notify the NHL no later than July 3,
2007, as to whether the Center Ice Services will include the streaming of radio
feeds (the “Radio Services”) as of the beginning of the Term or as of the start
of the second year of the Term.

 

·                  Consulting Services
— Upon individual request by the NHL, NeuLion shall provide the following
personnel services to assist the NHL and its Member Clubs in the development
and preparation of Content for the Service:

 

1.     Training classes for (i) Content Production
Strategy, (ii) Content Management, and (iii) Film and Field
Production; and,

2.     Content production outsourcing for Content
development, preparation and publishing to the Service by an individual Member
Club.

 

·                  Additional Specifications and
Requirements — The Service, the NeuLion iPTV Platform, the video
players and all of NeuLion’s other obligations hereunder shall, except to the
extent modified by the ultimate specifications for the Deliverables as mutually

 

8

 

agreed by the Parties (it being agreed that absent any such agreement,
the specifications set forth in this Exhibit A and Exhibits A-1 through
A-3 shall apply), conform in all material respects with:

 

1.     The “NeuLion iPTV Service Proposal” and “NeuLion
iPTV Web Solution Overview” presented by NeuLion to the NHL (a copy of which is
attached hereto as Exhibit A-1), with the exception of the “Form Agreement
Example” contained therein;

2.     The “NeuLion iPTV Service Proposal - Revised Pricing”
presented by NeuLion to the NHL on May 29, 2007 (a copy of which is
attached hereto as Exhibit A-2); and

3.     The “NHL Video Streaming Requirements” document
attached hereto as Exhibit A-3.

 

In the event of any conflict between the foregoing 3 documents, the
following order of precedence shall apply: Exhibit A-3, Exhibit A-2
and lastly, Exhibit A-1.  Moreover, Exhibit B
shall take precedence over any conflicting pricing terms in Exhibit A-2.

 

·                  Content Streaming
— In connection with all of NeuLion’s Content streaming hereunder, NeuLion
agrees to the following:

 

1.     NeuLion will install, set-up, and configure all
equipment, software, and systems required for encoding and streaming the
Content including but not limited to IRDs, monitoring systems, cabling and
satellites;

2.     NeuLion shall provide all technical resources
(hardware, software, etc.) in order to downlink and decode satellite signals of
NHL games using IRDs provided by the NHL and then encode those signals
(according to mutually agreed specifications) as required in order to include
them in NeuLion’s streaming network for access by subscribers;

3.     NeuLion may not use NHL IRDs for any purpose other
than to provide the Service to the NHL. 
Upon the expiration or termination of the Agreement for any reason,
NeuLion shall allow NHL to remove, or arrange the removal of, the IRDs from
NeuLion’s premises;

4.     NeuLion acknowledges and agrees that the NHL shall
control and manage the Content provided to NeuLion and that NeuLion will not
alter the Content in any way other than the conversion to a streaming format or
as directed by the NHL;

5.     NeuLion agrees to utilize satellite dishes
sufficient to downlink up to fifteen (15) simultaneous NHL games (both home and
away team feeds);

6.     The streaming rate for video shall have bit rate
of no less than 700 kbps unless directed by NHL to do otherwise, and the
streaming rate for audio shall be 28 kbps.

7.     NeuLion shall be responsible for all co-location,
including but not limited to racks, redundant power, and Tier 1 networking.

8.     At any time, the NHL may elect to bring some of
these activities in-house (e.g. the down-linking and encoding of game feeds),
in which case NeuLion shall 

 

9

 

work with the NHL to adjust Service delivery accordingly and to the
extent such transition results in cost savings to NeuLion the Parties shall
discuss in good faith an equitable sharing of such savings.

 

DELIVERABLES
AND SPECIFICATIONS

 

·                  Video Player —
NeuLion shall design, develop, implement and host a multimedia video player
through which the Content will be streamed to the NHL’s end users (the “Video
Player”).  The Video Player shall be
consistent in all material respects with the demonstrations given by NeuLion to
the NHL at the NHL’s offices on June 8, 2007, and with any incremental
features contained in any other demonstrations, documentation and other
materials furnished by NeuLion to the NHL in connection therewith.  In particular, and except to the extent
modified by the ultimate specifications for the Deliverables as mutually agreed
by the Parties, the Video Player shall:

 

1.     Be able to pull on-demand Content from the NHL’s
own content management system as well as from NeuLion’s own hosted systems;

2.     Include chat room functionality that enables the
end user to open a chat box next to the video window and select whether (a) to
enter a chat room for end users watching the particular Content then being
viewed by the end user or (b) to enter one of a pre-set list of other chat
rooms (e.g. organized per NHL team and/or per topic);

3.     Include a statistics feature that provides end
users with NHL statistics organized by team and by player;

4.     Include the ability to sort through the available
Content by (a) NHL team, and (b) type of content (e.g. live, VOD,
highlights, features, radio, stats);

5.     Include links to NHL team and player information,
previous team matchups, and other pertinent information and web pages as
designated by the NHL;

6.     Support multi-screen “mosaic” functionality, where
the end user can watch multiple games at once through smaller video windows,
select the game they wish to focus on, and enlarge that particular window up to
maximum size;

7.     Be able to detect the bandwidth capacity of end
users and, for end users who cannot adequately support the maximum bit rate
specified by the NHL, furnish them with Content encoded at a more suitable bit
rate; and

8.     Support integration with the NHL’s real-time
scoring system*, including:

a.                Real-time scores and game clock for all
games in progress;

b.               Real-time player/goalie stats (e.g.
goals, assists, shots on goal, penalty minutes, goals against average, save
percentage);

c.                Other real-time game stats (e.g. shots
on goal, faceoffs, powerplay opportunities/goals)

 

*The NHL acknowledges that its cooperation will be required in order to
achieve full integration of the NeuLion iPTV Platform and Video Player with the
NHL’s real-time scoring system.  The
Parties agree to work together in good faith to achieve such integration, but
NeuLion shall not be in breach of this Agreement for integration failures
caused by the NHL’s failure to furnish the necessary resources.

 

10

 

9.     In addition, NeuLion shall work with the NHL to
support whatever integration with Comcast’s streaming of NHL content becomes
necessary pursuant to the NHL’s existing contractual obligations with Comcast;
provided that to the extent such integration involves more than merely the
ability to link to Comcast’s own video player or website (rather than using the
Video Player’s own video window) when particular games are selected from the
menu of Content on the Video Player, such integration shall be subject to
technical feasibility and the Parties’ good faith agreement on appropriate
consideration to NeuLion.

 

·      Registration
Interface and Subscriber Control — NeuLion shall design, develop,
implement and host a registration interface to process subscriptions to
subscription-based Content packages (e.g. the NHL Center Ice Online package)
and assign unique user names and passwords (the “Registration Interface”).  In particular, and except to the extent
modified by the ultimate specifications for the Deliverables as mutually agreed
by the Parties, the Registration Interface shall:

 

1.     Support multi-lingual and multi-character-type
text for the names of the data capture fields;

2.     Pull the text of the NHL.com Terms of Services and
Privacy Policy from the NHL.com website into the Registration Interface (e.g.
through a scrollable text box);

3.     Enable collection of opt-in and opt-out
information specified by the NHL; and

4.     Ensure that each subscriber has a unique user-name
and support a password access system. 
NeuLion shall suspend a subscriber’s account at any time upon the
reasonable request of the NHL.

 

·      Payment
Processing — NeuLion shall design, develop, implement and host a
payment gateway for processing credit card transaction fees for any
subscription-based Content packages offered via the NeuLion iPTV Platform and
Video Player (the “Payment Gateway”), and shall be responsible for the credit
card transaction processing of all such fees (and any associated taxes) and
remitting all such amounts to the NHL. 
To this end, and without limitation, NeuLion shall:

 

1.     Ensure that the Payment Gateway can charge
subscribers in either US or Canadian currency based on the local of the
subscriber (i.e. quoting and charging a fee in the local US or Canadian
currency);

2.     To the extent funds are not deposited directly
into an NHL account, remit to the NHL any and all amounts collected by NeuLion
within 30 days after the end of each month (along with reports detailing the
basis for such payments);

3.     Use reasonable commercial efforts to include
indemnification obligations from any third party payment processors engaged by
NeuLion for their wrongful acts and omissions in their processing of financial
transactions hereunder (which obligations shall include indemnification of the
NHL and its affiliates); and

4.     Support the use of multiple price models (e.g.
Full-Season and Day Pass), pricing that can be changed during the course of the
season per time/date period (e.g. Full Season, Second Half Season, and
Playoffs), and pricing that can be

 

11

 

configured on a country-by-country basis (e.g. setting different
pricing for US, Canada, UK, Japan, etc.), in each case as specified by the NHL.

 

·      Geo-Filtering
and Content Blackout — NeuLion shall block Content pursuant to
blackout policies provided by the NHL. 
Such blocking will be based on the geographic location of the NHL
customer’s IP address at the time the customer seeks to access the Content,
regardless of where the customer is a resident or from where the customer
subscribed to the services.  For each NHL
team, the NHL will specify the team’s local telecast territory, and NeuLion
will blackout all of that team’s games (home and away) with respect to end
users identified by NeuLion as being located in that team’s local telecast
territory.  In addition, for games being
televised outside of a team’s local telecast territory, NeuLion shall blackout
such games for all end users located in the countries or territories where such
games are being televised, as specified by the NHL.  To this end, and except to the extent
modified by the ultimate specifications for the Deliverables as mutually agreed
by the Parties, NeuLion shall:

 

1.     Use its reasonable commercial efforts to (i) ensure
that it accurately associates the IP address of each end user to the geography
of each end user (including, without limitation, through the use of regularly
updated IP/ZIP databases, consistent with the highest industry standards) and (ii) minimize
the number of misidentifications (i.e. instances where NeuLion identifies a
user as being in one region when in fact they are in another region);

2.     Notify the NHL upon becoming aware of IP addresses
and/or end users that are being misidentified and comply with the NHL’s
determination as to what blackout rules should apply in such cases;

3.     Work in good faith with the NHL to continuously
improve the rate of accurate identifications over the course of the Term of the
Agreement;

4.     Use commercially reasonable efforts to identify
and block attempts by end users to circumvent the NHL’s blackout rules through
the use of proxy servers;

5.     Include an NHL-supplied message to consumers
seeking to access a blocked NHL game; and

6.     Allow the NHL to submit custom blackout schedule
lists in order to change their blackout designations of any game.  Among other things, this functionality would
enable the NHL to black out games that are televised nationally (or beyond the
local telecast territory of the teams involved) in all areas where such
telecasts are available.  Blackout
changes will be subject to database replication times.  48 business hours advance notice required.

 

MAINTENANCE AND SUPPORT

 

·      Support
— NeuLion shall provide Level 2 support in connection with the Content  packages managed by NeuLion hereunder.  NeuLion shall provide Level 2 support to the
NHL’s personnel during the NHL’s regular business hours and, for emergency
issues, on a 24/7 basis (phone or pager service).  Level 2 support shall be provided in
accordance with the Service Levels set forth in Exhibit C.  NeuLion shall assign a single point of
contact to the NHL for all issues arising in connection with the Service and
the NeuLion

 

12

 

iPTV Platform.  NeuLion shall also provide the NHL with
contact information for NeuLion’s network operations center.

 

·      Security
— NeuLion shall implement at all times during the Term industry-standard fraud
protection, and computer and data security measures.

 

13

 

EXHIBIT A-1

 

NeuLion iPTV Service Proposal

 

[See attachment]

 

14

 

	
  

  	
  NeuLion iPTV Service Proposal National Hockey League 

  

 

15

 

	
  

  	
  Proposal Contents Section One - NeuLion Summary Section Two -
  iPTV Web Solution Overview Section Three - NHL Proposal Section Four - NeuLion
  Consulting Services Section Five - NeuLion Management Team Section Six -
  Agreement 

  

 

16

 

	
  

  	
  NeuLion Summary The Future of Television 

  

 

17

 

	
  

  	
  NeuLion at a Glance Headquarters – Plainview, New York Research
  and Development Centers Plainview, New York Beijing, China Shanghai, China
  Encoding Centers Plainview, New York Beijing, China Plainview, New York IPTV
  Patents Pending End to End IPTV Technology and Process Proprietary CODEC
  End-To-End Encoding, Delivery and Set-Top-Box Service 

  

 

18

 

	
  

  	
  NeuLion iPTV lets you deliver your content anywhere in the world

  

 

19

 

	
  

  	
  NeuLion iPTV delivers the highest quality streaming video

  

 

20

 

	
  

   

   

  	
  Now Loading 2%

  

 

21

 

	
  

  	
  Consumer Freedom of Choice 

  

 

22

 

	
  

  	
  NeuLion iPTV Platform Components Encoding Services Consumer
  Delivery 

  

 

23

 

	
  

  	
  iPTV Delivery Service 

  

 

24

 

	
  

  	
  NeuLion iPTV Web Solution Overview 

  

 

25

 

	
  

  	
  Major Services Offering Content Management Subscriber Management
  Digital Rights Management Billing Delivery 

  

 

26

 

	
  

  	
  NeuLion iPTV Web Solution Other Key NHL Requirements Video and
  Banner Ad Insertion including “Companion Ad” capabilities Standard Metadata
  tagging for cross league sharing of videos Support for both Flash and Windows
  Media file formats Embedded Video features for Bloggers and Emailers Video
  Library integration between NeuLion and NHL.com 

  

 

27

 

	
  

  	
  National Hockey League League Wide Proposal 

  

 

28

 

	
  

  	
  NHL TV Marketplace Strategy Increase Visibility of the League
  Provide an Additional Advertising and Sponsor Revenue Platform Promote New
  Ticket Sales Outreach to the Community Connect Fans world wide with Hockey
  For the Fan - Another Reason To Join the NHL Family 

  

 

29

 

	
  

  	
  NHL TV Content Pre-Game Coverage Licensed Content Post-Game
  Coverage 

  

 

30

 

	
  

  	
  NHL TV Business Terms Roles and Responsibilities NHL and Teams
  Content creation and aggregation Marketing and Promotion of the Service
  Direct Subscriber Support NeuLion Content Management Content Delivery and
  Network Technical Support Subscriber Management 

  

 

31

 

	
  

  	
  NHL Pricing Proposal Setup Fees Setup Fees Design TV Console Per
  Team NHL League Office will be considered a team One Time Payment Per Team Type
  of Payment Annual Unit Price SETUP TV CONSOLE One Time ******

  

 

32

 

	
  

  	
  NHL Pricing Proposal Operational Fees per Team Notes: 1. Fees
  for service in excess of the above “Minutes per Month” will be Calculated at ******
  per extra minute of video served. Any excess service fees will be calculated
  and invoiced at the end of each year. ****** ****** ****** Tier Two Teams ******
  ****** ****** Tier One Teams ****** ****** ****** NHL.com Site Minimum
  (Mins/Month) (Mins/Month) Monthly Payment Out of Season In Season Group 

  

 

33

 

	
  

  	
  Tier One NHL Teams Teams Anaheim Boston Detroit Montreal Teams Rangers
  Ottawa Philadelphia Toronto 

  

 

34

 

	
  

  	
  NHL Pricing Proposal Operational Fees per Team Notes: 1. Fees
  for service in excess of the above “Minutes per Month” will be Calculated at ******
  per extra minute of video served. Any excess service fees will be calculated
  and invoiced at the end of each year. w/o Broadband Services ****** (Mins/Month)
  (Mins/Month) Minimum NHL.com Site ****** ****** ****** Tier One Teams ****** ******
  ****** Tier Two Teams ****** ******

  

 

35

 

	
  

  	
  Additional Terms and Information NeuLion Broadband Costs Equal
  to ****** Per Minute Served or ****** Per GB Content Storage limitations
  during the term of the agreement NHL.com 5,000 Total Hours Tier One Teams
  3,000 Total Hours Tier Two Teams 1,000 Total Hours 

  

 

36

 

	
  

  	
  Optional Individual Team Purchases Type of Payment Unit Price
  Annual Total Teams OPTIONAL INDIVIDUAL TEAM PURCHASES ADVERTISING INSERTION
  FEES (ESTIMATED 20 INSERT ADVERTISEMENTS) Per Transaction ****** ******
  CONTENT PRODUCTION OUTSOURCING Six Monthly Payments ****** ****** EQUIPMENT
  (CAMERA & PC’S) One Time ******

  

 

37

 

	
  

  	
  NHL Implementation All Thirty (30) Teams Implemented By October
  1, 2007 Setup Fees for TV Console Due As Work Is Completed & Project Plan
  League Wide Operational Fees Start October 1, 2007 Term Of Agreement Three
  Years Initial Payment of ****** 

  

 

38

 

	
  

  	
  NeuLion Consulting Services 

  

 

39

 

	
  

  	
  Service Offering Overview NeuLion iPTV Solution Training Content
  Production Outsourcing Strategic content consultation and development. Equipment
  identification, purchase, setup and training in editing services. Team buys
  the equipment. Staff hiring: Identifying personnel, interviewing, and assist
  in hiring. On-Air Talent: Identifying, interviewing, assist in hiring and
  on-air training. Library: Researching what content currently exists in the
  NHL and Team library, recognizing what is ready to run on the service, and
  updating what isn’t ready. 

  

 

40

 

	
  

  	
  Service Offering Overview NeuLion iPTV Solution Training Content
  Production Strategy Class Content Management Class Film and Field Production
  Content Production Outsourcing Term 6 months We will get the NHL Team product
  “on the air”, utilizing our staff and all of its resources. We will have the
  service running in the first 2 weeks of the engagement Following Production
  Schedule and Project Plan Engagement not to exceed three hundred hours,
  (300). (Detailed project management plan provided with Statement of Work 

  

 

41

 

	
  

  	
  Service Offering Overview Consulting Team PRODUCTION TEAM
  Executive Producer: Oversees day to day content. Producers: 3 producers in
  charge of gathering/shooting all content, producing it, editing it, encoding
  it, and uploading it to the Team interface. Associate Producers: 2 associate
  producers in charge of producing content for the Team interface. They also
  shoot, edit, encode, and upload. 

  

 

42

 

	
  

  	
  NHL TV Production Process Step 1-Shooting Coverage with 2
  cameras, 1 shooting the practice and commentary from our announcers, and 1
  shooting post practice interview sound in the locker-room. Step 2-Encoding
  Cameras connected to Laptops. Step 3-Producing Producers/associate Producers
  pick out the shots and pieces of content for Video Package. Step 4- Editing
  The video is edited using Final Cut Pro. Graphics and effects are added to
  the Video Package. Step 5- Uploading The final Video Package, “show”, is
  uploaded to the NeuLion interface. This can be done from anywhere there is an
  internet connection. Step 6- Publishing The completed video is published from
  the NeuLion interface, and is now viewable to anyone with an internet
  connection on NHL TV. 

  

 

43

 

	
  

  	
  NeuLion Management Team 

  

 

44

 

	
  

  	
  NeuLion Management Team The NeuLion management team is comprised
  of a seasoned group of industry veterans with over 15 years working together
  in enterprise software and media. Nancy Li Chief Executive Officer J. Chris
  Wagner Executive Vice President Marketplace Strategy Ronald M.E. Nunn
  Executive Vice President Business Operations Michael Her Executive Vice
  President Research & Development 

  

 

45

 

	
  

  	
  Form Agreement Example 

  

 

46

 

	
  

  	
  NeuLion iPTV is the fastest growing IPTV Platform

  

 

47

 

NeuLion iPTV Web Solutions Overview

 

NeuLion
iPTV Web Solution Overview

 

NeuLion is a full end to end enterprise level iPTV service
provider.  We build and manage private
broadcasting networks for companies interested in reaching a specific target
audience.  Since we use the public
internet, customers can reach the broadcast service from anywhere in the world –
on the TV, through the Web to a computer, or other consumer devices.  This is an overview of the NeuLion iPTV Web
Solution Features, Functions and Benefits.

 

TV CONSOLE SERVICES PROVIDED

 

Design and personalization of Company branded
web browser interface (the NeuLion iPTV TV Console) based on NeuLion provided
design templates include the following TV Console features:

 

1.                                      Video
viewable as broadcast channels, auto-playing spotlights or video-on-demand
(VOD)

 

NeuLion’s iPTV TV Console delivers a rich video experience.  The console has a large main video viewing
window that plays the current program and the user can browse the site while
video is playing.  Based on user’s
available bandwidth, the system will automatically deliver the best video
quality available.

 

Each channel has a program schedule and the server plays the content
based on a predefined daily schedule. 
This creates a true TV-like experience. 
Only NeuLion’s iPTV solution can deliver the same experience on TV
through the STB and on through an internet browser.  The electronic programming guide tells the
user what is playing and when their favorite program is scheduled.

 

The system can support a large number of linear channels because with
internet television there is no limit on the number of channels you may have.

 

By default, the spotlights and channels begin playing as soon as the
user logs on.  This “always on” feature
gives the under instant gratification, without waiting for content to play.

 

In addition, the linear channels have on-demand support and gives the
combined “broadcast television/personal video recorder” experience all in
one.  The on-demand video can be grouped
into various categories or genre of interest. 
Users can easily find the content they want to watch.

 

a.                                       Organize
VOD content in a multiple media folder structure.  A video can be placed under more than one
folder.  This feature supports “episode
folders” that group episodes of the same show under the same folder.

 

48

 

NeuLion iPTV Web Solution Overview

 

b.                                      Grouped
pages to accommodate large collections of media.  Allows for formatting of the user interface
in a way that large video collections can be organized in a meaningful way.

 

c.                                       Browse-n-play
allows end-users to browse while the current video continues playing.

 

d.                                      Linear
channel management for the schedule and playing of linear (broadcast) content.

 

e.                                       Supports
live broadcasting of real-time events.

 

f.                                         Advertising
management where the Company can specify messaging to be displayed on the main
end user console

 

i.                                          Multi-line
animated text with stop/forward/rewind capability.

 

ii.                                       Programmable
text/image banner with tracking statistics.

 

iii.                                    “Teaser”
low-bandwidth banner video for visibility on other websites.

 

iv                                      Synchronized
ads alongside a video based on video time index.

 

v.                                      Management
interface for ad banners.

 

g.                                      Supports
RSS and pod-casting.

 

h.                                      Supports
trailer presentment (accessible along-side the full video).

 

i.                                          Event-oriented
media grouping - provides yet another way of organize content in a meaningful
and easy way for location.

 

j.                                          Full-screen
viewing capabilities.

 

2.                                      The
“What’s New” feature automatically lists most recently added video titles to
help the user see the latest auditions to the service.

 

3.                                      Multi-title
preview allows consumers to preview multiple video titles at the same time.

 

4.                                      Comprehensive
search and video recommendation wizard based on consumer viewing habits.

 

a.                                       Basic
search by title, description or tags/keywords.

 

49

 

NeuLion iPTV Web Solution Overview

 

b.                                      Advanced
search by title, description, cast, or tags/keywords, release date or category.

 

5.                                      Creates
a social network and interactive community with a user’s ability to upload
video, share “buddy” play-lists and send messages.

 

a                                          User
buddies and buddy groups.

 

b.                                      Per-user
playlists, which may be private, public or shared among buddies only.

 

c.                                       Generate
URL for a public playlist (e.g., for sending to friends by email).

 

d.                                      Supports
clips of videos in a playlist.

 

e.                                       Per-video
commentary and rating.

 

f.                                         Multiple
discussion forums.

 

g.                                      User
video upload, which could be specified as private, public, or shared among
buddies only.

 

Setup and implementation of Company in the
NeuLion Commerce Engine includes the following:

 

1.                                       Supports
direct order capture from Company web site. 
Allows the Company to take orders on their existing website and flow
seamlessly through to the NeuLion provided service.

 

2.                                       Definition
of consumer payment models (subscription, pay-per-view or combination) and
associated payment processing.  This
allows the Company tremendous flexibility in defining rates and charges for
content.

 

-
Credit card processing including validation and charging.

 

Setup and implementation of Company in the
NeuLion iPTV Delivery Platform:

 

1.                                       Encoding
of up to twenty (20) hours of Company provided video content.

 

2.                                       Training
of Company personnel on video encoding, meta data creation and upload to the
NeuLion iPTV Delivery Platform.

 

50

 

NeuLion iPTV Web Solution Overview

 

BASIC OPERATIONAL SERVICES PROVIDED

 

Ongoing operations and support of the NeuLion
iPTV Delivery Platform include the following Content Management features:

 

1.                                      Web-based
self-service administration console for content providers.  Allows the Company to be self-sufficient in
updating and managing their service.

 

2.                                      Web-based
content management system for video clip control with self service capability
for Company content administrator.

 

a.                                       Encode
videos on the hosted site through a scalable online encoder farm, or encode
content in-house through provided encoding profile.

 

b.                                      Batch
encoding services

 

i.                                          Encode
from live video source (e.g. from camera, webcam, satellite, cable, set-top
box, etc.)

 

ii.                                       Encode
from video tiles of most common video formats (e.g., MPEG, AVI, MOV, WMV, DVD)

 

c.                                       Upload/manage
content and metadata through secured internet access

 

i.                                          Online
thumbnail creation for associating images with the video.

 

ii.                                       Define
“similar videos” to allow user to find related materials quickly.

 

iii.                                    Publish
the content.

 

d.                                      Organize
VOD contents in a custom hierarchy

 

i.                                          Nested
media folder structure.  A video can be
placed under more than one folder. 
Allows for the creation of intuitive “buckets” of content for users.

 

ii.                                       Support
“episode folders” that group episodes of the same show under the same folder.

 

e.                                       Linear
channel management for the schedule and playing of linear (broadcast) content.

 

f.                                         Support
live broadcasting of real-time events.

 

51

 

NeuLion iPTV Web Solution Overview

 

3.                                      Workflow
manager for meta-data and program schedule content association and management.

 

4.                                      Content
storage and backup for up to ten thousand (10,000) hours of VOD content.

 

5.                                      Statistical
reporting on content and viewer usage.

 

a.                                       Online
statistic reports

 

b.                                      User
access reports

 

c.                                       VOD
access reports

 

d.                                      Top
ten reports

 

e.                                       Total
viewing time reports

 

f.                                         View
count reports

 

g.                                      Category
reports

 

h.                                      Audit
trail reports

 

i.                                          Orders
summary reports

 

j.                                          Order
reports

 

Ongoing operations and support of the NeuLion
iPTV Delivery Platform include the following Security features:

 

1.                                       Consumer
management and authentication for access to the Company’s service.

 

k.                                       Supports
several access modes:  open and free,
free but requires registration with valid email address, requires special
per-user access code (e.g., sent by post mail), monthly subscription,
pay-per-view.

 

l.                                          Support
“verification by image” during sign-up to prevent mass subscription by robot
attacks or hackers.  This significantly
reduces the number of forged registrations.

 

m.                                    Supports
email verification to allow only users with valid email address to have access.

 

n.                                      Lock
account on repeated logon features. 
Automated self-serve unlock support.

 

52

 

NeuLion iPTV Web Solution Overview

 

o.                                      Automated
self-serve “forgot password” support for password retrieval by end-users.

 

p.                                      Collection
of user profile for analytic purposes. 
Assists Company in determining trends in user’s video watching habits.

 

q.                                      End-user
self-service support for viewing/editing user profile, change password, etc.

 

r.                                         Multi-language
end-user GUI.

 

s.                                       Highly
brand-able end-user GUI.  Allows
extensive customization for the “look and feel” of the service.

 

2.                                       Encryption
of sensitive information to protect consumer privacy

 

-
Flexible DRM (Digital Rights Management, Microsoft-based) to protect the
content and allow for various rights management scenarios.

 

3.                                       Role
based access control for administration and reporting

 

-
User management interface for CSR (customer service representatives)

 

Ongoing operations and support of the NeuLion
iPTV Delivery Platform include the following Streaming Video features:

 

1.                                       Fast
start video streaming processor provides an improved consumer experience,
without waiting for video to begin playing.

 

2.                                       Multiple
bit rate calibration to accommodate end-consumer bandwidth capability.  The service automatically detects bandwidth
availability to the end user and auto-selects the correct version of the video
to play.

 

3.                                       Geographically
dispersed network points of presence for improved performance and redundant
availability.  NeuLion has multiple data
centers to deliver the content based on location and network conditions of the
user.

 

4.                                       Internet
bandwidth management and monitoring to ensure the highest level of service to
the user is achieved.

 

53

 

NeuLion iPTV Web Solution Overview

 

Ongoing operations and support of the NeuLion
iPTV Delivery Platform include the following Commerce Engine features:

 

1.                                       Integrate
one time and recurring payment gateway billing for processing of transactions.

 

2.                                       Support
for pay-per-view and subscription billing options.

 

3.                                       Payment
and settlement reporting.

 

54

 

EXHIBIT A-2

 

 

[Slide 1]

 

NeuLion
iPTV Service Proposal

Revised
Pricing – May 29, 2007

 

National
Hockey League

 

[Slide 2]

 

NeuLion
“Center Ice” Service

 

·                                          Live Game
Feeds

·                                          Center
Ice “Usually Away Feeds”

·                                          In-Market
“Home Feeds”

·                                          Live
Game Radio

 

·                                          NeuLion
Service and Costs

·                                          Downlink
and Encoding Only

·                                          Based
on three feeds for 1,340 games per season

–                                         “Home
Feed, Away Feed, and Radio Feed”

·                                          Monthly
Fee of ******

 

[Slide 3]

 

NHL Pricing Proposal TV Console Setup Fees

 

·                                          “Player”
Setup Fees

·                                          Design
TV Console

–                                         Based
on NHL Design Template

–                                         Each
Team “Player” or “Console” will be implemented using the NHL Design Template

·                                          Including
support for two languages

–                                         Additionally,
Teams can work with NeuLion directly for custom enhancements of the NHL Design
Template

 

	
  Not Priced Below

  	
   

  	
  Payment

  	
   

  	
  Unit Price

  	
   

  
	
  NHL Design
  Template

  	
   

  	
  One Time

  	
   

  	
  ******

  	
   

  
	
  Per Team
  Implementation of Template

  	
   

  	
  One Time

  	
   

  	
  ******

  	
   

  

 

55

 

[Slide 4]

 

NHL
Pricing Proposal Service Fees

 

·                                          NeuLion
Service Includes –

·                                          Content
Management, Subscriber Management, Billing, Registration, Digital Rights
Management, Ad Server Integration, Geo Targeting, Syndication, and Reporting
and Tracking.

·                                          Includes
services for payment gateway, (Payflow, Verisign, etc)

·                                          Includes
Storage

·                                          NHL Custom
Setup and Implementation fee ****** (One Time Fee)

·                                          League
Service Fee of ****** per Month

 

[Slide 5]

 

Additional Terms and Information

 

·                                          NeuLion
Delivery Fees

·                                          Live
and On-Demand Streaming

·                                          Digital
Rights Management

·                                          Broadband
Usage Fee Equal to ****** per GB

·                                          Content
Storage limitations during the term of the agreement

·                                          NHL.com
5,000 Total Hours

·                                          Tier
One Teams 3,000 Total Hours

·                                          Tier
Two Teams 1,000 Total Hours

 

[Slide 6]

 

NeuLion Consulting Services

As Originally Proposed

 

[Slide 7]

 

Service Offering Overview

 

·                                          NeuLion iPTV
Solution Training

·                                          Content
Production Strategy Class

·                                          Content
Management Class

·                                          Film
and Field Production

·                                          ******

·                                          Content
Production Outsourcing

·                                          Term
6 months

·                                          We
will get the NHL Team product “on the air”, utilizing our staff and all of its
resources.

·                                          We
will have the service running in the first 2 weeks of the engagement

·                                          Following
Production Schedule and Project Plan

·                                          Engagement
not to exceed three hundred hours consulting hours, (300).  (Detailed project management plan provided
with Statement of Work

 

[Slide 8]

 

NeuLion iPTV is the fastest growing IPTV Platform

 

56

 

EXHIBIT A-3

 

NHL Video Streaming Requirements

 

	
  Summary

  	
   

  
	
   

  	
   

  
	
  ·

  	
  Content
  Production

  
	
   

  	
  ·

  	
  “Islanders TV” style video production and content for all teams

  
	
   

  	
  ·

  	
  Live Game feeds for “Center Ice Streaming”

  
	
   

  	
  ·

  	
  Automated import of Hockey Factory Content

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Video
  Player Functionality and Features

  
	
   

  	
  ·

  	
  Easily Skinnable players, Playback controls (Stop, Skip, pause/play)

  
	
   

  	
  ·

  	
  Full-screen playback and auto-play support

  
	
   

  	
  ·

  	
  Customizable user interface

  
	
   

  	
  ·

  	
  Playlisting, Sharing of selected clips, RSS subscriptions

  
	
   

  	
  ·

  	
  Integrated search, Search engine optimization

  
	
   

  	
  ·

  	
  Multiple platform support (Windows, Mac, Linux)

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Content Management

  
	
   

  	
  ·

  	
  Per clip usage policies

  
	
   

  	
  ·

  	
  Metadata tagging

  
	
   

  	
  ·

  	
  Integration with NHL.com and Team web sites

  
	
   

  	
  ·

  	
  Transcode services

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Subscriber Management

  
	
   

  	
  ·

  	
  User Database

  
	
   

  	
  ·

  	
  Billing and customer payment processing User Registration tools

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Delivery

  
	
   

  	
  ·

  	
  Live streaming and video on demand

  
	
   

  	
  ·

  	
  E-commerce capabilities

  
	
   

  	
  ·

  	
  Zip code level access control

  
	
   

  	
  ·

  	
  Digital Rights Management

  
	
   

  	
  ·

  	
  Ad network integration

  
	
   

  	
  ·

  	
  Highly redundant and geographically diverse streaming network

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Reporting

  
	
   

  	
  ·

  	
  Usage reporting by clip, site, or network wide

  
	
   

  	
  ·

  	
  Comparative reports: most shared, most viewed

  
	
   

  	
  ·

  	
  Tracking of embedded/shared/emailed clips.

  
	
   

  	
  ·

  	
  Integration with Omniture

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Content Production

  
	
   

  	
  ·

  	
  “Islanders TV” style video production and content for all teams

  
				

 

57

 

	
   

  	
  ·

  	
  Produce the NHL Team TV product utilizing Neulion staff and all of
  its resources to: Shoot, Encode, Produce, Edit, Upload, and Publish

  
	
   

  	
  ·

  	
  Engagement not to exceed three hundred hours

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Acquisition/ encoding of Live Game feeds

  
	
   

  	
  ·

  	
  Center Ice Streaming

  
	
   

  	
  ·

  	
  In-market streaming of local rightsholder feed.

  
	
   

  	
  ·

  	
  Live Game Audio “Home & Away”

  
	
   

  	
  ·

  	
  Zip code level gating, billing, and
  subscriber support for both packages.

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Hockey Factory Content

  
	
   

  	
  ·

  	
  Automated import of Hockey Factory Content and associated metadata
  (individual event highlights, game highlights, some condensed games,
  no-stoppage whole games, weekly and occasional compilations)

  
	
   

  	
  ·

  	
  Integrated with NHL’s content management system.

  
	
   

  	
   

  	
   

  
	
  Video Player Functionality and Features

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Design Features

  
	
   

  	
  ·

  	
  Easily Skinnable players for team, team
  special event, team sponsor features, etc.

  
	
   

  	
  ·

  	
  Playback controls (Stop, Skip, pause/play)

  
	
   

  	
  ·

  	
  Full-screen playback and auto-play support

  
	
   

  	
  ·

  	
  Customizable user interface allowing teams to categorize, organize,
  and present their video content the way(s) that they choose to.

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Functionality

  
	
   

  	
  ·

  	
  Playlisting: Team-created manual playlists, auto-generated
  most-recent/most watched/most shared playlists, user-created playlists that
  can be shared with friends.

  
	
   

  	
  ·

  	
  Email sharing of selected clips, code to
  embed sharable clips in blogs and social networking sites.

  
	
   

  	
  ·

  	
  RSS subscription support.

  
	
   

  	
  ·

  	
  Integrated search
  capabilities.

  
	
   

  	
  ·

  	
  Search engine optimization supporting crawls
  by Google, Yahoo, MSN, etc.

  
	
   

  	
  ·

  	
  Multiple platform support (Windows, Mac,
  Linux)

  
	
   

  	
   

  	
   

  
	
  Content Management

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Per clip usage policies and management
  (non-DRM):

  
	
   

  	
  ·

  	
  Schedule based publishing and expiration of
  clips

  
	
   

  	
  ·

  	
  Pay per view/subscription support with user registration, e-commerce, geographical/zip code restriction

  
	
   

  	
  ·

  	
  Multiple team site and third party syndication
  support

  
	
   

  	
  ·

  	
  Sharability

  

 

58

 

	
  ·

  	
  Metadata

  
	
   

  	
  ·

  	
  Standard Metadata tagging and management with facility for metadata
  import from external systems.

  
	
   

  	
  ·

  	
  Ability to add custom metadata fields

  
	
   

  	
  ·

  	
  Thumbnail generation

  
	
   

  	
   

  	
   

  
	
  ·

  	
  Integration

  
	
   

  	
  ·

  	
  Integration with NHL.com and Team web sites
  for contextual linking of individual event highlights and game highlights.
  Links to clips by Player, Team, Game, Event type (goal, hit , save).

  
	
   

  	
  ·

  	
  Integration with NHL Content Management System.

  
	
   

  	
   

  
	
  ·

  	
  Transcode services with connectors for common
  third party delivery destinations like mobile carriers, youtube, yahoo,
  amazon, apple.

  
	
   

  	
   

  	
   

  
	
  Subscriber Management

  
	
   

  	
  ·

  	
  User Database with query and import/export tools

  
	
   

  	
  ·

  	
  Billing and customer payment processing and support.

  
	
   

  	
  ·

  	
  User Registration tools with the ability to specify data collection
  and integrity requirements and the ability to specify the collection of
  customized data fields when desired (Add Favorite Player...).

  
	
   

  	
   

  	
   

  
	
  Delivery

  
	
   

  	
  ·

  	
  Live streaming and video on demand in both Flash and Windows Media.
  Support for progressive download Quicktime as well.

  
	
   

  	
  ·

  	
  E-commerce capabilities with broad payment gateway/merchant account
  support (PayPal Payflow Pro Gateway)

  
	
   

  	
  ·

  	
  Zip code level access control and gating for live streams.

  
	
   

  	
  ·

  	
  Digital Rights Management license delivery and policy management if
  desired. Support for Flash DRM tools when they become available.

  
	
   

  	
  ·

  	
  Ad network integration for both pre and post roll clips and companion
  ads. Tools to manage ad frequency.

  
	
   

  	
  ·

  	
  Support for major ad networks like Doubleclick DART and
  Lightningcast.

  
	
   

  	
  ·

  	
  Advanced targeting capabilities.

  
	
   

  	
  ·

  	
  Team players should have ability to manage and sell inventory
  delegated to them.

  
	
   

  	
  ·

  	
  Highly redundant and geographically diverse streaming
  network with guaranteed service level availability of *****.

  
	
  Reporting

  
	
   

  	
  ·

  	
  Usage reporting by clip, site, or network wide. Including user
  metrics like avg. view duration, client type, format, bit rate, bandwidth,
  screen resolution.

  
	
   

  	
  ·

  	
  Automated scheduled usage reports.

  
	
   

  	
  ·

  	
  Comparative reports: most shared, most viewed

  
	
   

  	
  ·

  	
  Tracking of embedded/shared/emailed clips.

  

 

59

 

	
   

  	
  ·

  	
  Integration with Omniture
  (web analytics) for player and stream reporting. Inclusion of Omniture
  measurement code in players and streaming media.

  

 

60

 

EXHIBIT B

 

NEULION SERVICE FEES

 

In consideration for services provided to the NHL, NeuLion shall
receive the following fees from the NHL:

 

·                  Base Services Fees — For NeuLion’s Base Services, the NHL
shall pay NeuLion:

 

1.                A one time fee of **********;

2.                A one time fee of **********;

3.                A one time fee of **********;

4.                A one time fee of **********;

5.                A monthly recurring fee of ***********;
and,

6.                A monthly recurring fee during the Term
of the Agreement equal to ***************************.

 

·                  Center Ice Services Fees — For NeuLion’s Center Ice
Services, the NHL shall pay NeuLion:

 

1.                A monthly recurring fee of ***

2.                A monthly recurring fee during the Term
of the Agreement equal to the *******.

3.                In the event NeuLion elects to start
providing the Radio Services only as of the start of the second year of the
Term, the fixed monthly recurring fee for the Center Ice Services for the first
year of the Term, as set forth in Exhibit B, shall be *****.

4.                The monthly recurring fee shall be
**************.

 

·                  Consulting Services Fees — For NeuLion’s Consulting
Services, the NHL shall pay NeuLion:

 

1.                A one-time fee of ********, excluding
pre-approved, documented, reasonable travel expenses for class instructors;
and,

2.                A fixed fee per
Member Club engagement of ********* for up to 300 labor hours.

 

************************************************************************************************************
************************************************************************************************************
************************************************.

 

Absent delays caused by the NHL (excluding a mutually agreed period of
time afforded to the NHL to perform testing of the Deliverables, at its own
expense, pursuant to Section 2 of the Agreement) or Force Majeure Events,
NeuLion shall complete final setup and delivery of all Deliverables, in each
case in accordance with the terms of this Agreement, by the following dates
(the “Delivery Dates”):

 

·               Center Ice Services:

 

61

 

·      Registration functionality – September 7,
2007

·      Full product – September 21, 2007

 

·     Team Video Player:

·      Full product – September 1, 2007

 

·     In-Market Streaming Player:

·      Full product – September 7, 2007

 

·     Radio Player/Functionality:

·                   Full product (if
NeuLion elects to provide the Radio Services beginning with the first year of
the Term) – September 7, 2007

·                   Full product
(if NeuLion elects to provide the Radio Services beginning with the second year
of the Term) – September 7, 2008

 

Failure to meet any Delivery Dates by more than 5 business days shall
entitle the NHL to terminate this Agreement, in whole or with respect to the
delayed portions thereof, without liability to NeuLion.

 

At anytime during the Term of this Agreement, if, as reported by three (3) or
more recognized industry analysts, **** **** (iii) the NHL will have the
option to request a corresponding reduction of the ********* used in
calculating the monthly fees payable to NeuLion in sections Base Service Fees,
item 5 and Center Ice Fees, item 2 above.

 

62

 

EXHIBIT C

 

Service
Levels

 

In its performance of the Services hereunder, NeuLion shall meet or
exceed the following Service Levels:

 

1.     Outages/Permitted
Downtime

 

NeuLion shall use its best efforts to minimize the number of Outages
throughout the Term.  For the purpose of
this Agreement, an “Outage” shall mean a continuous period of two (2) minutes
where the NeuLion iPTV Platform is not performing in accordance with this
Agreement (including, without limitation, with respect to Content streaming, registration/subscription
processing, or payment processing); provided that the following shall be
excluded from the calculation of Outages (“Permitted Downtime”):

 

·                   Up to 12 hours
per month of scheduled maintenance, to be performed during off-peak times (i.e.
during periods where no live games are in progress) and only upon 3 days prior
notice to the NHL; and

·                   Downtime caused
by events outside of NeuLion’s reasonable control, as measured by the highest
standards of the hosting and video streaming industries (which, for clarity,
require that NeuLion (i) employ failover equipment, multiple streaming
providers and other redundancies to mitigate the effect of any given equipment
or provider outage, (ii) perform adequate testing on any third party
firmware, hardware or other applications or equipment prior to placing them in
a production environment, and (iii) generally using a standard of care
consistent with the highest standards of the hosting and video streaming
industry in its operation and support of the Service and the NeuLion iPTV
Platform).

 

2.     Latency

 

NeuLion shall use its best efforts to keep Latency below three (3) seconds
throughout the Term.  For the purposes of
this Agreement, “Latency” shall mean the network latency measured and reported
by NeuLion’s IP transit and CDN network providers, and NeuLion shall provide
the NHL with a report directly from such CDN verifying all Latency
measurements.  Latency shall exclude
delays caused by events outside of NeuLion’s reasonable control, as measured by
the highest standards of the hosting and video streaming industries (which, for
clarity, require that NeuLion (i) employ failover equipment, multiple
streaming providers and other redundancies to mitigate the effect of any given
equipment or provider outage, (ii) perform adequate testing on any third
party firmware, hardware or other applications or equipment prior to placing
them in a production environment, and (iii) generally using a standard of
care consistent with the highest standards of the hosting and video streaming
industry in its operation and support of the Service and the NeuLion iPTV
Platform).

 

63

 

3.     Blackout
Failures

 

In the event of *** or more failures by NeuLion to blackout any NHL
game substantially with respect to end users that NeuLion has identified as
being subject to such blackout (e.g. NeuLion fails to blackout a Rangers game
with respect to end users that NeuLion has determined are located within the
Rangers blackout region, regardless of where such determination is accurate),
the NHL may terminate this Agreement upon notice to NeuLion.

 

4.     Support
Response Times

 

NeuLion shall use its best efforts to respond to and resolve Service
issues in accordance with the following:

 

	
  Priority

  	
   

  	
  Initial

  Response

  	
   

  	
  Updates

  	
   

  	
  Fix Plan Response Time

  
	
  Severity 1 – Disruption that prevents
  access to streaming Content.

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Severity 2 – Viewing or listening dropouts,
  degradations or intermittent interruptions

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Severity 3 – Service does not operate as
  designed, moderate operational impact. No end user impact.

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Severity 4 – Minor problem. No end user
  impact.

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Severity 5 – NHL request for enhancement

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  

 

5.     Remedies

 

If (A) Outages occur either (i) *** times in a given month or
(ii) *** times over the course of any *** months during the Term, and/or (B) Latency
exceeds *** over the course of (i) *** or (ii) *** during the Term,
the NHL shall have the right to terminate this Agreement upon 30 days notice to
NeuLion.

 

In addition, in the event that the NHL issues refunds to Service end
users as a result of Service-related issues occurring on any given day during
the Term, then for each such day, the Parties shall work together in good faith
to determine whether such issues were the result of Outages (i.e. not Permitted
Downtime), and in such cases NeuLion shall reimburse the NHL for any such
refunds issued, up to a maximum of the daily equivalent

 

64

 

of NeuLion’s monthly recurring Center Ice Services Fee ****** ******
******.

 

6.     Monitoring
and Reporting

 

NeuLion shall continuously monitor the Service and the NeuLion iPTV
Platform for performance against the foregoing Service Levels.  NeuLion shall furnish the NHL with reasonable
access to an up-to-date online monitoring system that will enable the NHL to
view NeuLion’s Service Level performance going back at least as far as ****.

 

NeuLion shall also provide the NHL with test objects for each NeuLion
Point-of-Presence (“POP”), so as to enable the NHL to monitor each POP through
its own third party monitoring solution (currently Gomez).

 

65

 

Attachment B

 

Advertising Fee Schedule

 

	
  Streamed
  Event #

  	
   

  	
  NeuLion’s
  Share of Advertising Revenue

  
	
  1

  	
   

  	
  ***

  
	
  Additional Event

  	
   

  	
  ***Exhibit
10.1

 

SEVENTH
AMENDMENT TO

SECOND
AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS SEVENTH AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(this “Amendment”), dated as of June 18,
2009 and effective as of the date on which all of the conditions set forth in Section 5
have been satisfied or waived by the Administrative Agent (the “Amendment Effective Date”), which
amends that certain Second Amended and Restated Credit Agreement dated as of March 30,
2006, as amended by the First Amendment to Second Amended and Restated Credit
Agreement dated as of May 2, 2006, the Second Amendment to Second Amended
and Restated Credit Agreement dated as of October 25, 2006, the Third
Amendment to Second Amended and Restated Credit Agreement dated as of November 29,
2006, the Fourth Amendment to Second Amended and Restated Credit Agreement
dated as of March 1, 2007, the Fifth Amendment to Second Amended and
Restated Credit Agreement dated as of May 7, 2007, and the Sixth Amendment
to Second Amended and Restated Credit Agreement dated as of May 9, 2008,
by and among VENOCO, INC., a Delaware corporation (the “Company”),
the Guarantors, each of the Lenders party thereto, BANK OF MONTREAL, a Canadian
chartered bank acting through certain of its U.S. branches or agencies, as
Administrative Agent (in such capacity, the “Administrative
Agent”), CREDIT SUISSE, CAYMAN ISLANDS BRANCH, and LEHMAN
COMMERCIAL PAPER INC., as Co-Syndication Agents and FORTIS CAPITAL CORP., as
Documentation Agent (as in effect immediately prior to the Amendment Effective
Date, the “Credit Agreement”), is by and
among the Company, the Guarantors, each of the Lenders party hereto and the
Administrative Agent.

 

WHEREAS,
the Company has requested that the Credit Agreement be amended to make certain
changes to the Credit Agreement on the terms and conditions set forth in this
Amendment; and

 

WHEREAS,
the Supermajority Lenders have agreed to such amendments subject to the terms
and conditions set forth in this Amendment.

 

NOW,
THEREFORE, in consideration of the mutual agreements, provisions and covenants
contained herein and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

Section 1.               Defined
Terms; Interpretation.

 

(a)           Capitalized terms used but not
otherwise defined herein shall have the meanings assigned such terms in the
Credit Agreement.

 

(b)           The rules of interpretation set forth in Section 1.2
of the Credit Agreement are incorporated in this Amendment as if set forth
herein.

 

Section 2.               Borrowing
Base.  The Lenders hereby approve a
Borrowing Base of $125,000,000 as of the Amendment Effective Date.  Such determination shall constitute the current
annual Borrowing Base determination for purposes of Section 2.6(b) of
the Credit Agreement.

 

1

 

Section 3.               Amendments.  The Credit Agreement is hereby amended as
follows:

 

(a)           The definitions of “Base Rate” and “Pricing
Grid” are hereby amended and restated to read in their entirety
as follows:

 

“Base
Rate” means, for any day and with respect to all Base Rate
Loans, a fluctuating rate of interest per annum equal to the greatest of (a) the
rate of interest most recently announced by Bank of Montreal at its Chicago,
Illinois office as its “base rate” for Dollar advances made in the United
States, (b) the Federal Funds Rate most recently determined by the
Administrative Agent plus 1/2% (0.5%) per annum and (c) the LIBO Rate for
a one-month Interest Period plus 1.5%. 
The Base Rate is not necessarily intended to be the lowest rate of
interest determined by Bank of Montreal or any Lender in connection with
extensions of credit. Changes in the rate of interest on that portion of any
Loans maintained as Base Rate Loans shall be effective from and including the
effective date of such change in the Base Rate. 
The Administrative Agent will give notice to the Borrower of changes in
the Base Rate due to a change in the rate of interest described in clause (a) of
this definition promptly upon receipt of notice of any such change from Bank of
Montreal.

 

“Pricing
Grid” means the annualized rates (stated in terms of basis
points (“bps”)) set forth below, which shall be computed as of each day during
the term hereof for the Applicable Margin (and Letter of Credit Rate) and
Commitment Fee based upon the Utilization Percentage on such day as follows:

 

	
   

  	
   

  	
   

  	
   

  	
  Applicable Margin

  	
   

  	
   

  	
   

  
	
  Pricing
 Level

  	
   

  	
  Utilization

  Percentage

  	
   

  	
  Base
  Rate Loan
 (bps)

  	
   

  	
  LIBO Rate

  Loan/Letter of

  Credit Rate
 (bps)

  	
   

  	
  Commitment

  Fee
 (bps)

  	
   

  
	
  Level IV

  	
   

  	
  90% or more

  	
   

  	
  150.0

  	
   

  	
  300.0

  	
   

  	
  50.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level
  III

  	
   

  	
  60%
  or more but less than 90%

  	
   

  	
  125.0

  	
   

  	
  275.0

  	
   

  	
  50.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level
  II

  	
   

  	
  30%
  or more but  less than 60%

  	
   

  	
  100.0

  	
   

  	
  250.0

  	
   

  	
  50.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level
  I

  	
   

  	
  less
  than 30%

  	
   

  	
  75.0

  	
   

  	
  225.0

  	
   

  	
  50.0

  	
   

  

 

Section 4.               Amendment
and Ratification.  Upon the
effectiveness hereof as provided in Section 5 of this Amendment, this
Amendment shall be deemed to be an amendment to the Credit Agreement, and the
Credit Agreement, as modified hereby, is hereby ratified, approved and
confirmed to be in full force and effect in each and every respect.  The execution, delivery and effectiveness of
this Amendment shall neither operate as a waiver of any right, power or 

 

2

 

remedy of any Lender or any Agent, nor constitute a waiver
of any provision of any of the Loan Documents. 
All references to the Credit Agreement in any other document,
instrument, agreement or writing shall hereafter be deemed to refer to the
Credit Agreement as amended hereby and as may be further amended, amended and
restated, supplemented or otherwise modified from time to time pursuant to the
terms thereof and the Intercreditor Agreement.

 

Section 5.               Conditions
to Effectiveness.   The effectiveness of this Amendment is subject
to the condition that the Administrative Agent shall have received all of the
following, in form and substance satisfactory to the Administrative Agent and
each Lender, and in sufficient copies for each Lender:

 

(a)           Amendment.  This
Amendment, duly executed and delivered by each of the Company, the Guarantors
and each Supermajority Lender.

 

(b)           Payment of Fees.  Evidence of payment by the Company of all
accrued and unpaid fees, costs and expenses owed pursuant to the Credit
Agreement or this Amendment, in each case to the extent then due and payable at
the Amendment Effective Date, including any such costs, fees and expenses
arising under or referenced in Sections 2.8 and 11.4 of the Credit Agreement.

 

(c)           Other Documents. 
Such other approvals, opinions, documents or materials as the
Administrative Agent or any Lender may reasonably request.

 

Section 6.               Representations
and Warranties.  The Company and each
Guarantor each hereby represent and warrant that, as of the date hereof and the
Amendment Effective Date, after giving effect to this Amendment:

 

(a)           Bring-Down of
Representations and Warranties.  The
representations and warranties of the Company and each Guarantor contained in Article VI
and Section 4.5(b) of the Credit Agreement are true and correct on
and as of the Amendment Effective Date, as though made on and as of such date.

 

(b)           No Litigation.  No litigation is pending or threatened
against the Company or any Subsidiary in which there is a reasonable probability
of an adverse decision which would result in a Material Adverse Effect.

 

(c)           No Material
Adverse Effect.  There has occurred
no event or circumstance that has resulted or would reasonably be expected to
result in a Material Adverse Effect since December 31, 2008.

 

(d)           No Default or
Event of Default.  No event has
occurred and is continuing which constitutes a Default, an Event of Default or
both.

 

Section 7.               Governing
Law.  THIS AMENDMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

3

 

Section 8.               Costs
and Expenses.  The Company shall pay
all reasonable costs and expenses incurred by the Administrative Agent or any
other Agent, the Lenders or any of their Affiliates in connection with the
development, preparation, administration and execution of this Amendment,
including Attorney Costs incurred by any such Person with respect thereto.

 

Section 9.               Counterparts.  This Amendment may be executed in any number
of separate counterparts, no one of which need be signed by all parties; each
of which, when so executed, shall be deemed an original, and all of such
counterparts taken together shall be deemed to constitute but one and the same
instrument.  A fully executed counterpart
of this Amendment by facsimile signatures or delivered in portable document
format (.pdf) shall be binding upon the parties hereto.

 

[Signature Pages Follow]

 

4

 

IN WITNESS WHEREOF, the
parties hereto have caused this Seventh Amendment to Second Amended and
Restated Credit Agreement be duly executed and delivered by their respective
duly authorized officers as of the date first set forth above, to be effective
as of the Amendment Effective Date.

 

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  VENOCO, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  WHITTIER PIPELINE CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TEXCAL ENERGY (LP) LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  VENOCO, INC., its Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TEXCAL ENERGY (GP) LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  VENOCO, INC., its Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  Chief Executive Officer

  

 

Venoco Seventh
Amendment Signature Page

 

 

	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  TEXCAL ENERGY SOUTH TEXAS L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  TEXCAL ENERGY (GP) LLC, as general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  VENOCO, INC., its Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  CATCO ENERGY LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  VENOCO, INC., its Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy M. Marquez

  
	
   

  	
   

  	
  Timothy M. Marquez

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for Notice to the Company and the Guarantors: 

  
	
   

  	
  Principal Place of Business and Chief Executive Office:

  
	
   

  	
   

  
	
   

  	
  370 17th Street, Suite 2950

  Denver, Colorado
  80202-1370

  Attention: Chief Financial
  Officer

  Facsimile No.: (303)
  626-8315

  

 

Venoco
Seventh Amendment Signature Page

 

 

	
   

  	
  ADMINISTRATIVE
  AGENT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK
  OF MONTREAL, acting through its U.S. branches and agencies,
  including its Chicago, Illinois branch, as Administrative Agent and as a
  Lender

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph A. Bliss

  
	
   

  	
   

  	
  Joseph A. Bliss

  
	
   

  	
   

  	
  Managing
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BMO
  CAPITAL MARKETS FINANCING, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James V. Ducote

  
	
   

  	
   

  	
  James V. Ducote

  
	
   

  	
   

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CO-SYNDICATION AGENT AND A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  CREDIT
  SUISSE, CAYMAN ISLANDS BRANCH

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Vanessa Gomez

  
	
   

  	
   

  	
  Name: Vanessa Gomez

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mikhail Faybusovich

  
	
   

  	
   

  	
  Name: Mikhail Faybusovich

  
	
   

  	
   

  	
  Title: Vice President

  

 

Venoco
Seventh Amendment Signature Page

 

 

	
   

  	
  DOCUMENTATION AGENT AND A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  FORTIS CAPITAL CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Montgomery

  
	
   

  	
   

  	
  Name: David Montgomery

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Darrell Holley

  
	
   

  	
   

  	
  Name: Darrell Holley

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  AMEGY BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gregory J. Petruska

  
	
   

  	
   

  	
  Name: Gregory J. Petruska

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NOVA SCOTIA

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David G. Mills

  
	
   

  	
   

  	
  Name: David G. Mills

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  
	
   

  	
  UNION BANK OF CALIFORNIA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Douglas Gale

  
	
   

  	
   

  	
  Name: Douglas Gale

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK OF OKLAHOMA, NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Guy C. Evangelista

  
	
   

  	
   

  	
  Name: Guy C. Evangelista

  
	
   

  	
   

  	
  Title: Senior Vice President

  

 

Venoco
Seventh Amendment Signature Page

 

 

	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  KEYBANK NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Todd Coker

  
	
   

  	
   

  	
  Name: Todd Coker

  
	
   

  	
   

  	
  Title: Assistant Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  RZB FINANCE LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Shirley Ritch

  
	
   

  	
   

  	
  Name: Shirley Ritch

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John A. Valiska

  
	
   

  	
   

  	
  Name: John A. Valiska

  
	
   

  	
   

  	
  Title: First Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  A LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
  THE ROYAL BANK OF SCOTLAND PLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Slye

  
	
   

  	
   

  	
  Name: David Slye

  
	
   

  	
   

  	
  Title: Senior Vice
  President

  

 

Venoco Seventh Amendment Signature Page

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