Document:

ex102.htm

 

Exhbibt 10.2

 

 

 

 

DISH NETWORK L.L.C.

 

AFFILIATION AGREEMENT

(Domestic)

[CHANNEL]

This Affiliation Agreement (the “Agreement”) is entered into as of May 1, 2013 (the “Effective Date”) by and between The Real Hip Hop Network (“Network”), and DISH Network L.L.C., 9601 South Meridian Blvd., Englewood, Colorado 80112 (“DISH”).

RECITALS

A.           DISH has established a multi-channel video distribution platform for the distribution of programming services; and

B.           Network wishes for DISH to distribute the Service (defined below) in accordance with the terms and conditions contained in this Agreement.

For good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties mutually agree as follows:

AGREEMENT

1.           DEFINITIONS: The following terms shall have the meanings set forth below:

(a)           “Affiliate” means, with respect to either party, any person or entity that directly or indirectly, or through one or more intermediaries, Controls, is Controlled by, or is under common Control with that party.

(b)           “Other DISH Content” means video, audio, data, interactive, IP and/or other content transmitted on behalf of any entity, which content is not part of one of DISH’s residential and/or commercial programming packages.

(c)           “Control” including the words “Controls” or “Controlled by” means the power to direct or cause the direction of the management, policies and/or affairs of a person or entity whether through the ownership of voting securities, by contract or otherwise.

(d)           “Distribution System” means the distribution system employed by DISH to distribute audio, video, data and other programming services to Subscribers in the Territory whereby the programming satellite signal or feed is: (i) received by DISH and (if applicable) is digitized, compressed, encrypted, and otherwise processed; and (ii) transmitted for reception by Subscribers using transmission systems (whether now existing or developed in the future including without limitation terrestrial cable, fiber optic cable, broadband or other web based or non-web based technologies) which DISH or DISH’s Affiliate owns, operates, leases, controls, manages or otherwise accesses.

(e)           “Facility” means the downlink facility(ies) at which the Service is received by DISH or its Affiliate. The term “Facility” shall include, without limitation, the reception, compression, processing and uplink/data aggregation facility(ies) operated by or on behalf of DISH or any of its Affiliates in Cheyenne, Wyoming, Gilbert, Arizona and/or any additional location designated by DISH from time to time in its sole discretion.

  

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(f)           “Law” means all federal, state and local law or regulation applicable to each party’s performance of its respective obligations hereunder.

(g)           “Other Distributor” means any other person or entity, including Network, which distributes the Service in the Territory by any means including without limitation DBS providers, cable system operators, cellular telephone providers and Internet service providers.

(h)           “Reporting Period” means the period of time between the 22nd day of one calendar month and the 21st day of the following calendar month, as such period may change from time to time in DISH's sole judgment.

(i)           “Service” means the 24 hour a day, 7 days a week linear programming service commonly known as The Real Hip Hop Network (as more fully described below in Section 4 of this Agreement). The term, “Service” includes any component and/or part thereof including, without limitation, all interactive components, graphics, scrolls or other visual graphics and all portions of the VBI (or its digital equivalent), and any commercial advertising that may air on the Service.

(j)           “Service Subscriber” means any Subscriber that is authorized by DISH or its Affiliate to receive the Service using any form of device, now or hereinafter devised, used for, inter alia, the reception and display of visual images, audio and/or data, regardless of whether the Subscriber actually receives the Service or not.

(k)           “Signal” means the programming signal or feed containing the Service, including all video, audio, data and other components, as delivered by Network to the Facility.

(l)           “Subscriber” means any residential or non-residential (including, without limitation, commercial) location or person in the Territory that is authorized by DISH or its Affiliate to receive any level of television programming service or package of television programming services, either directly or through a Subdistributor (as defined in Section 3(b) below).

(m) “Territory” means the United States, its territories, commonwealths and possessions, including without limitation the District of Columbia, Puerto Rico and the United States Virgin Islands.

2.           TERM: This Agreement commences on the Effective Date and continues in effect through 11:59 P.M. Mountain Time on February 28, 2015, unless terminated earlier in accordance with the terms and conditions of this Agreement (the “Term”).

3.           GRANT OF RIGHTS:

(a)           Grant of Rights. Network hereby grants to DISH and its Affiliates the non-exclusive right and license (including without limitation the requisite license to all copyright, trademark and other intellectual property rights appurtenant to the programming content that makes up the Service), but not the obligation, throughout the Term to display, perform and distribute the Service in the Territory via the Distribution System to Service Subscribers.

(b)           Additional Rights. In addition to and without limiting the generality of the grant of rights contained in Section 3(a) above, DISH shall have the right and the license, but, except as expressly provided in this Agreement, not the obligation to: (i) receive and decrypt the Service; (ii) advertise, promote, publicize, market and sell subscriptions to the Service (and/or the Service as bundled with other services) in the Territory pursuant to the terms and conditions contained in this Agreement (which right, for the avoidance of doubt, shall extend to DISH’s retail distribution network); (iii) transport and arrange

  

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for the transport of the Signal to third parties who gain rights to the Service independent of DISH including, without limitation, to cable system operators (both franchised and non-franchised); and (iv) sub-distribute, re-sell and/or otherwise sublicense the Service to third parties (collectively, “Subdistributors”) including, without limitation, cable system operators and service providers to developments such as master planned communities, gated residential communities, homeowners’ associations, multiple dwelling units, colleges and universities, and housing cooperatives (which sub-distribution may include sub-distribution to parties that may use various technological methodologies to obtain and distribute the Service including, without limitation, C-band receive facilities such as SMATV  systems and all forms of wireless and wire-line data distribution technology such as BSS or FSS satellite regardless of frequency or band, copper wire, fiber optic, or coaxial cable, Internet protocols and other Internet-based technologies and all forms of terrestrial wireless either now existing or hereafter developed). DISH shall have the right but not the obligation to receive the Signal from any Other Distributor.

(c)           Right to Record. DISH and its Affiliates may record the Service in DISH’s sole discretion in furtherance of the rights granted in this Agreement including, without limitation, DISH’s right to preempt and replace content that airs on the Service, as allowed by this Agreement.

(d)           Overspill. Notwithstanding anything to the contrary contained in this Agreement, Network understands and agrees that the Signal, when transmitted from a satellite by DISH or its Affiliates, will extend beyond the geographic boundaries of the Territory and that such “overspill,” in and of itself, shall not be a breach of this Agreement.

4.           CONTENT OF THE SERVICE:

(a)           Content Description. The programming on the Service shall be a 24 hour a day, 7 day a week (“Full-Time”) Hip-Hop Culture themed video programming service branded The Real Hip-Hop Network and shall consist exclusively of Hip-Hop Music Videos, Documentaries, Films, Break Dance Battles, D Competitions, Talent Showcases, Movies, Celebrity News, Live Concerts, etc. geared toward the 18-34 hip-hop demographic. Except as specifically provided herein, Network shall not black out any that airs on the Service.

(b)           Content Limitations. Network represents and warrants that the Service (including any advertising contained in the Service) will not contain any of the following: (i) programming that is rated (or if not rated, that would have been rated) more restrictively than PG-13 by the Motion Picture Association of America or TV-14 under the National Cable Television Association TV Parental Guidelines, or any comparable rating under any successor or other industry ratings system that is wisely adopted by the cable television industry; (ii) a sufficient quantity of music videos such that the Service could be characterized as a music video service; (iii) a sufficient quantity of children's programming such that the Service could be characterized as a children's programming service; (iv) live or taped excerpts or entire portions of actual courtroom trials, hearings or other similar proceedings as a substantial component of the programming; (v) pay-per-view movies or events; (vi) financial news; (vii) blackouts; (viii) promotion or marketing of “800”, “888”, “900”, or “976” telephone services, or any other services that bill a caller for placing or confirming the call (other than for the telephone company's cost of the call); (ix) programming that relates directly or indirectly to gambling, the occult, astrological, psychic, sexual or romantic activities or products or other adults-only services or products; or (x) programming for which Network seeks a surcharge or additional fee of any kind. In no event may the Service contain any of the following: (A) any infomercial licensed by Network from any entity or person (or any of their respective agencies) that has licensed any infomercials in a four (4) hour consecutive block directly to DISH within the then-previous one (1) year period; (B) any live direct on-air sales programming content that has been distributed by DISH within the then-previous one (1) year period; or (C) any Other DISH Content; in any

  

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case, without the written permission of a senior executive of DISH. No officer, director, shareholder or employee of Network or any Affiliate of Network shall undertake any act or omission to circumvent the application of the preceding sentence including, without limitation, the purposeful creation of an entity that does not conform to the definition of Affiliate set forth herein above. Network shall not use the Service to “incubate” or “nest” any additional programming service brand into the Service or products; or (x) programming for which Network seeks a surcharge or additional fee of any kind.

(a)           Avails. Network shall provide to DISH not less than two (2) minutes of commercial advertising time on the Service each hour during each calendar day of the Term (the “Avails”). DISH shall have the right to use the Avails as it chooses in its sole and exclusive discretion (including, but not limited to the sale of the Avails to third parties). Without limiting the foregoing, in accordance with the “Most Favored Nations” Section of this Agreement, DISH shall be entitled to at least the same number of minutes of commercial advertising time at as favorable placement slots on the Service as any Other Distributor. DISH and its Affiliates shall have the right to retain all of the proceeds derived from the sale of the Avails. Upon launch of the Service and at all times during the Term thereafter, Network shall provide DISH with industry standard cue tones to signal and enable DISH’s use of the Avails.

(b)           Advertising Restrictions. Network shall ensure that the Service will not contain any of the following: (i) promotions or advertisements for any other multi-channel video programming distributor or other entity that competes, directly or indirectly, with DISH in the distribution of television programming services; (ii) promotions or advertisements for any other video programming service (including any programming service affiliated or associated with Network) unless DISH distributes the other service via the Distribution System; (iii) advertising or messages which in any way disparages DISH, any Affiliate of DISH or the Distribution System (either generically as satellite technology or specifically as DISH Network or any successor brand); (iv) calls to action or similar messages aimed at or having the effect of adversely impacting relations between DISH and its Subscribers and/or its governmental regulators; (v) prompts or triggers with respect to information embedded in or around the Signal that DISH has not agreed to in advance and in writing; or (vi) promotional spot (whether alone or in conjunction with any other person or entity) indicating that any other method of video distribution offers a service not available on the Distribution System. In addition to and without limiting any other rights and remedies DISH may have, DISH shall have the right to preempt and replace any material that violates this Section 4(d) or any other provision of this Agreement in any way.

(c)           Closed Captioning and Program Rating Information. Network represents, warrants and covenants that it shall, at its sole expense, include as part of the Signal closed-captioning information to the full extent required by any Law and to the extent required to ensure that DISH is in compliance with the Law regardless of whether the Law now or in the future imposes the obligation to include closed captioning information on Network, DISH or a third party. This includes, without limitation, meeting any and all benchmarks for captioning programming, including without limitation foreign language programming, as set forth in 47 CFR 79.1 of the regulations of the Federal Communications Commission (“FCC”) as amended from time to time (the law and the regulations collectively referred to as the “Closed Captioning Requirements”). Network also agrees to cooperate with DISH to the extent necessary to establish compliance with the Closed Captioning Requirements. Furthermore, during the Term, Network shall, at its sole expense, include as part of the Signal ratings information or other such data that would enable Service Subscribers to exercise parental controls over the programming on the Service, and such ratings information or other data must be compatible with DISH’s set-top and interactive technology implementing parental controls. Network shall use its best efforts to provide complete, accurate and timely program rating data to DISH’s designated data provider (currently Tribune Media Systems), as that data provider may be changed from time to time. For standard definition, such data shall be delivered in accordance with CEA 608-C. For high definition, Network shall (i) provide CEA 608-C compatibility data within CEA-708-B structures as described in CEA 708-B, including closed caption and parental

  

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rating information, (ii) ensure that the bandwidth allocated for CEA 708-B closed caption data does not exceed 2 kbps, and (iii) provide the program rating data to DISH’s currently designated data provider as above. Neither DISH, nor any of its Affiliates, shall have any liability in connection with Network’s failure to prepare, insert or include closed-captioning information, as applicable, in the Service as required by this Section 4(e).

(d)           Other Laws. In the event that any programming on the Service is regulated by any Law that is applicable to Network or its Affiliates or DISH or its Affiliates, then Network shall comply with the Law, ensure that the Service complies with the Law and provide DISH with all documents reasonably necessary for DISH to demonstrate compliance with the Law in a timely manner.

(e)           Content Deviation. If for any reason DISH, in good faith, determines that the Service (i) includes programming that is other than the programming described in this Section 4, or is prohibited by this Section 4 and/or (ii) does not include programming of at least the quantity, quality, type and content as required by this Section 4 or any other provision of the Agreement (a “Content Deviation”), DISH shall have the right, in addition to any other rights or remedies available to it in this Agreement, at law or in equity but not the obligation, at its sole option to (A) immediately suspend DISH’s distribution of the Service hereunder and/or (B) terminate this Agreement and cease its transmission of the Service to Service Subscribers; each of (A) and (B) without any liability to Network whatsoever and Network covenants to never contend to the contrary. In such an event, Network explicitly agrees that, notwithstanding anything to the contrary set forth in this Agreement, its payment obligations hereunder shall continue to be based on the number of Service Subscribers that would have received the Service had DISH not exercised its rights set forth in (A) above.

(f)           Certificate of Compliance. Within thirty (30) days after the last day of each calendar year during the Term, or upon written request by DISH at any time during the Term, Network shall deliver to DISH a written certificate of its compliance or non-compliance (as the case may be) with this Section 4 of this Agreement (‘Content of the Service’) signed by an officer of Network with sufficient knowledge to make such certification. The certification shall also include a description of the means and mechanisms Network used to determine whether it has complied or failed to comply with this Section 4 of this Agreement.

(g)           Remedies. Network acknowledges that compliance with this Section 4 of this Agreement is material to this Agreement, and that any remedial measure specified in this Agreement is bargained for, not as a penalty but rather as a reasonable allocation of damages which would otherwise be difficult to ascertain. Any remedy specified in this Section 4 of the Agreement shall be in addition to and not in limitation of any other rights or legal or equitable remedies DISH may otherwise have.

5.           DELIVERY AND DISTRIBUTION OF THE SERVICE:

(a)           Delivery by Network.

(i)           Delivery of Signal. Network shall, at its own cost and expense, deliver to DISH the Signal using a domestic communications satellite commonly used for the transmission of pay television programming which is receivable at all times during the Term by the Facility without additional expense to DISH. Further to the foregoing, Network shall ensure that the Signal is delivered (A) on a Full-Time basis; (B) at a high level of video and audio quality which is, at a minimum, at a technical quality comparable to that of signals delivered by other programming services; (C) in compliance with DISH’s reasonable technical requirements; and (D) in compliance with the highest industry standards, to the Facility and all other locations within the Territory designated by DISH in its sole discretion. In addition, Network shall, at its own cost and expense, have in place either appropriate back-up transponder space on

  

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a second domestic communications satellite or a reserve back-up fiber optic link to the Facility so that, in the event of a failure of the first satellite link, delivery of the Service to the Facility shall not be interrupted or discontinued. Thirty 30 days prior to the Effective Date, Network shall deliver both the Signal and primary and secondary integrated receiver decoders (“IRDs”) capable of decoding the Service to each of DISH’s Facilities located in Cheyenne, Wyoming and Gilbert, Arizona (for clarity, Network must provide a total of four (4) IRDs). DISH reserves the right to require delivery of the Signal and IRDs to additional Facilities in its sole discretion upon reasonable notice to Network. The Signal shall be deemed delivered to DISH when received in a form technically acceptable to DISH.

(ii)           Change in Delivery. In the event Network changes the satellite or encryption technology or otherwise modifies the Signal in such a manner that the Signal cannot be received or used by DISH or its Affiliates as required by this Agreement (a “Delivery Change”), then Network unconditionally agrees to promptly reimburse DISH for the costs to acquire and install the necessary equipment to receive and/or use the Signal, which amount shall be payable by Network within thirty (30) days after receipt by Network of an invoice from DISH. Network agrees to provide DISH with at least ninety (90) days' prior written notice of a Delivery Change; provided that, if a satellite change is the result of a Force Majeure Event (as defined in Section 16(f) of this Agreement), Network shall provide DISH with written notice as soon as reasonably practicable. Notwithstanding the foregoing, if Network makes a Delivery Change to a different satellite or technology commonly used for the transmission of pay television programming (including without limitation delivery via primary and back-up fiber to the Facilities), Network shall ensure there are primary and back-up delivery technologies and Network shall be required to reimburse DISH for only a pro rata portion of such costs, which pro rata portion shall be determined by multiplying the total amount of such costs by a fraction, the numerator of which shall be the number of channels included in the Service (which could be one or more), and the denominator of which shall be the number of cable programming services received and distributed by DISH that are available on the new satellite or technology change.

(b)           Delivery by DISH. DISH reserves the right to reassign any and all channel numbers at any time and from time to time at its sole discretion. In the event that DISH elects to reassign the Service’s channel number, DISH will make commercially reasonable efforts to provide Network with written notice at least thirty (30) days prior to the effective date of such reassignment. Network acknowledges that DISH or its Affiliates may digitize, compress and encode the Signal and that, on occasion, the Distribution System may be down for maintenance. Neither such digitizing, compression and encoding, or such maintenance downtime shall be deemed a prohibited interruption or alteration of the Service. DISH may provide Service Subscribers with, and provide the Service using, VCR or PVR-like functionality with respect to Service programming. For clarity, any restrictions on DISH contained in this Agreement shall only apply to DISH as a distributor of the Service in its capacity as a distributor of the Service (including without limitation with respect to the provision of IRDs and digital video recorders to Subscribers), and shall not in any way inhibit DISH as a consumer electronics manufacturer.

(c)           Reservation of Rights to Bandwidth. Network represents and warrants that other than the principal video and accompanying audio portions of the Signal (the “Primary Signal”), including without limitation any portions of the bandwidth that may be created or made useable as a result of the digitization or compression of the Signal, not all of the signal distribution capacity contained within the bandwidth of the Signal is essential to or a part of the Service or necessary to the delivery or distribution of the Service. DISH reserves all rights in and to, and reserves all rights to use, such nonessential bandwidth of the Signal including without limitation, audio sub-carriers and all lines of the vertical blanking interval (“VBI”) (and/or its digital equivalent) from the Facility through to Service Subscribers. Nothing contained in this Agreement shall restrict DISH from using any and all of the bandwidth of the Signal from the Facility through to Service Subscribers by any means or for any purpose so long as the use does not materially degrade or interfere with the quality of the Primary Signal. Notwithstanding the foregoing,

  

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DISH shall transmit to Service Subscribers all data or information that the FCC or any applicable Law requires DISH to transmit (“Required Materials”) in a format reasonably specified by DISH. Notwithstanding anything to the contrary contained in this Agreement, DISH shall have the right, but not the obligation to distribute any material, information, data, images, sounds or features contained or embedded in or around any portion of the feed provided to DISH for the Signal that is not part of the Primary Signal or part of the Required Materials.

(d)           Embedding. Network shall not embed any information, data, images, sounds or features into or around any portion of the Signal (collectively, “Embedded Information”) that is not related to the Service. Network agrees that it shall not include any Embedded Information that cannot be removed and/or blocked by the Distribution System using equipment then-existing and available at the Facility. Network hereby consents to such removal and blocking, and agrees to provide to DISH assistance and information  reasonably requested by DISH with respect to the removal and/or blocking, as long as the removal and/or blocking will not remove, block, interfere with or impede in any way the Primary Signal or the Required Materials. If the equipment required for removal or blocking is commonly used in the cable television industry by DBS providers, DISH shall be responsible for obtaining the equipment. Notwithstanding the foregoing, Network agrees that, other than Required Materials, it shall not include any Embedded Information that would impede, interfere with or degrade the function of any hardware, software, firmware or any other equipment or device used by DISH or degrade the Primary Signal. Network acknowledges that Nielsen’s video based measurement system may cause minimal degradation to the Primary Signal that may be perceptible to Service Subscribers, and agrees that it shall use commercially reasonable efforts to transition to the Nielsen audio based measurement system or a similar system that does not degrade the Primary Signal. Network represents that, other than the Required Materials, it is not currently engaged in embedding any Embedded Materials, and Network agrees that is shall provide DISH with ninety (90) days’ advance written notice (or such shorter time as is practicable under the circumstances) of its intention to embed any Embedded Materials prior to commencement of such embedding, which notice shall describe with specificity the information Network intends to embed and the technical placement of the information within the Signal. Further, Network agrees that after commencement of the embedding, it shall provide DISH with at least one hundred twenty (120) days’ advance written notice (or, if shorter, the maximum length of time that is practicable under the circumstances) of its intention to change any of the Embedded Materials and/or the technical placement of the Embedded Materials within the Signal.

(e)           Launch. Subject to Network’s compliance with all of its obligations set forth in this Agreement (including, without limitation, its obligations set forth in Sections 4, 5, 6(i), and 12), DISH will use commercially reasonable efforts to launch the Service no later than one hundred twenty (120) days after DISH’s receipt of the Signal and corresponding IRDs (the “Anticipated Launch Date”). For clarity, DISH may launch the Service prior to the Anticipated Launch Date.

6.           FEES:

(a)           Monthly Fees. In consideration of and subject to the terms and conditions set forth in this Agreement, Network shall pay DISH, on a monthly basis, beginning on the Effective Date, the amounts per calendar month set forth below, adjusted on a prorated basis for any portion of the relevant calendar month in which DISH, in accordance herewith, elects not to run or otherwise does not transmit the Service as a result of (x) the start date or end date of broadcast hereunder being other than the first or last day of the calendar month, (y) a Preemptive Event, or (z) an event of Force Majeure (such amount as adjusted hereunder, the “Monthly Fee”):

	
CONTRACT YEAR

	
DATE RANGE

	
FEE PER CALENDAR YEAR

	
Year 1

	
May 1, 2013-

February 28, 2014

	
$1.00 per Service Subscriber

	
Year 2

	
May 1, 2014-

February 28, 2015

	

$1.00 per Service Subscriber

 

 

 

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(b)           Pre-Payment by Network. Prior to 12:00 p.m. Mountain Time Zone on the last business day of each calendar month during the term, Network shall pay to DISH, in advance, the Monthly Fee for the immediately following calendar month (based on the number of Service Subscribers at the end of the Reporting Period concluding during the prior calendar month). For clarity and by way of example, the Monthly Fee for the calendar month of November 2013 would be pre-paid by Network prior to 12:00 p.m. Mountain Time Zone on October 29, 2013, based on the number of Service Subscribers at the end of the Reporting Period concluding in September (the August 22nd – September 21st Reporting Period). Network shall pre-pay all Monthly Fees by wire transfer in accordance with instructions provided by DISH. Each invoice provided by DISH to Network shall set forth: (i) the number of Service Subscribers attributable to the calendar month being invoiced; (iii) the Monthly Fee attributable to such calendar month; (iii) the days and times, if any, that the Service was not transmitted during the previous calendar month; and (iv) any credits, if any, given Network pursuant to the terms and conditions of this Agreement with respect to (iii) above.

 

(c)           Service Subscribers. For purposes of the calculation of Monthly Fees, the number of Service Subscribers for each calendar month shall be deemed the number of Service Subscribers) at the end of the Reporting Period concluding during the relevant calendar month in accordance with Section 6(b) above. For example, the Monthly Fees for the calendar month of November would be based on the number of Service Subscribers on September 21. Notwithstanding the foregoing, to the extent Service Subscriber numbers are required hereunder for a time period during which the Service was not actually distributed by DISH, then such Service Subscriber numbers shall be estimated by DISH based on its reasonable projection of Service Subscriber numbers if the Service had been distributed during such time period.

(d)           Bulk Bill Arrangements. Notwithstanding the foregoing, in the event that DISH or a Subdistributor distributes the Service on a bulk bill basis (a “Bulk Bill Arrangement”), the number of Service Subscribers for which Network will pay DISH in accordance with Section 6(a) of this Agreement shall be fifty percent (50%) of the units in such bulk bill property whether or not all units in such bulk bill property are occupied. DISH reserves the right to determine in its sole discretion whether a multi-unit development is subject to a Bulk Bill Arrangement.

(e)           Late Payments and Payment Defaults. If any payment due under this Agreement is not received by DISH in full when it is due, then in addition to and without limiting any other remedy available to DISH at law or in equity (i) any amounts not received shall bear interest at the rate of one and one half percent (1.5%) per month from the date such amounts were due, or the highest rate allowed by law, whichever is lower and (ii) notwithstanding the cure provisions set forth in Section 13(a) below, DISH shall be entitled to immediately suspend its obligations hereunder and/or terminate this Agreement and cease its transmission of the Service to Service Subscribers without any liability to Network whatsoever and Network covenants to never contend to the contrary. Acceptance of such late fee by DISH shall not constitute a waiver of any other rights DISH may have at law or in equity with respect to the breach.

(f)           Payment from Service Subscriber. Under no circumstances shall Network collect a payment directly from a Service Subscriber for the Service Subscriber’s receipt of the Service. If Network receives such a payment, it shall immediately forward the payment to DISH without any offset of any kind.

  

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(g)           Offset. Network shall not have the right to offset, against any payments due to DISH in this Agreement, any amounts owed by DISH or any of its Affiliates to Network or any of its Affiliates under this or any other agreement.

(h)           No Responsibility for Taxes. DISH shall not have any responsibility or assume any liability for the determination, calculations, collection and remittance to proper taxing authorities of any sales use or other taxes related to or arising out of the Service, all of which shall be the sole responsibility of Network.

(i)           Deposit. Before the Launch Date, Network shall, in order to secure performance of its obligations hereunder, remit to DISH One-Million, Five-Hundred Thousand Dollars ($1,500,000) (the “Deposit”).  DISH is not required to keep the Deposit in escrow. Instead, DISH may keep the Deposit in any interest-bearing account and any and all interest earned on the Deposit shall be the exclusive property of DISH. If Network fails to make any payment due under this Agreement by its due date, DISH shall have the immediate right to draw-down the corresponding amounts from the Deposit. Multiple and partial draw-downs may be made against the Deposit. The amounts of any such draw-down shall be applied to the obligations of Network under this Agreement. In such an event, Network shall replenish the full amount of all such draw-down amounts within two (2) business days of receipt of notice from DISH of such a draw-down. Network’s provision and maintenance of the Deposit in accordance with this Section 6(i) is of the essence of this Agreement and failure to maintain the Deposit at its full value (i.e., replenishing such Deposit after each draw-down) by the date required and/or failure to maintain the Deposit throughout the Term shall entitle DISH, in addition to and without limiting any other remedy at law or in equity, to immediately suspend its performance hereunder and/or terminate this Agreement and cease its transmission of the Service without any liability to Network whatsoever and Network covenants to never contend to the contrary. Within sixty (60) days following expiration of this Agreement or any earlier termination other than termination for cause by DISH in accordance with Section 13(a) below, DISH will remit to Network any unused portion of the Deposit then on account (which for clarity, shall be reduced by any amount payable by Network (or any Affiliate of Network) to DISH.

7.           AUDIT RIGHTS:

Network agrees to keep and maintain accurate books and records with respect to its performance under this Agreement and its relationships with Other Distributors for the period of time during which Network is providing the Service to such Other Distributors at all times during the Term and for a period of one (1) year thereafter. In order to verify Network’s compliance with and/or to determine whether Network has given full effect to the terms of this Agreement, at all times during the Term and for one (1) year thereafter, DISH may, upon sixty (60) days written notice and at DISH's expense (except as provided below), during Network's regular business hours (such hours to be determined in Network’s reasonable discretion) at Network's office where records are regularly maintained, audit all books and records relating to such obligations. DISH's right to perform such audit shall be limited to once in any consecutive twelve (12)-month period. The audit shall be conducted by and only though a third party independent auditor that has entered into a reasonable non-disclosure agreement with Network. The results of any such audit conducted pursuant to this Section 7(a) shall be final and binding upon Network and Network covenants never to contend to the contrary. In the event that any audit conducted pursuant to this Section 7(a) reveals non-compliance with Section 9 on the part of Network then, in addition to DISH’s other rights and remedies, DISH will invoice Network for the full dollar amount attributable to Network’s non-compliance with Section 9 and DISH’s reasonably incurred expenses in connection with such audit, which Network agrees to pay in full immediately upon receipt.

 

 

8.           MARKETING AND USE OF MARKS:

 

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(a)           Network Marks. Network hereby licenses to DISH, and DISH shall have the right to use, Network Marks (as defined below) to promote the Service and the Distribution System. Additionally, DISH shall have the right to provide Network Marks to its third party retail distribution network as well as third parties who are selling the Service by or through DISH (including by way of example but not limitation, Subdistributors and co-branding partners). DISH acknowledges that the name and mark “The Real Hip Hop Network” and any other of Network’s names, trade names, service marks, trademarks and/or logos (including, without limitation, the names, titles or logos of certain programs and likenesses of persons) that are protectable by applicable law (collectively, the “Network Marks”) are the exclusive property of Network and its suppliers and that DISH has not and will not acquire any proprietary rights in the Network Marks other than as set forth in this Agreement. Except as provided in this Agreement, DISH shall at no time adopt or use, without Network’s prior written consent, any variation of the Network Marks, or any work or mark likely to be similar to or confused with a Network Mark. Any and all goodwill arising from DISH's use of the Network Marks shall inure solely to the benefit of Network. DISH shall submit to Network for approval any of DISH's promotional materials mentioning or using the Network Marks (other than materials provided by Network to DISH, if any) which approval shall not be unreasonably withheld, conditioned or delayed. If Network fails to disapprove such promotional materials within five (5) business days of delivery by DISH, then Network shall be deemed to have approved the submitted materials. Uses of the Network Marks in routine promotional materials such as program guides, program listings and bill stuffers, or in a manner previously approved by Network, shall be deemed approved for all subsequent uses unless Network specifically notifies DISH to the contrary.

(b)           DISH Marks. Subject to this Section 7(b) of the Agreement, Network shall have the limited right to use DISH Marks (as defined below) to promote the Service as distributed over the Distribution System to prospective Service Subscribers in the Territory. Subject to the terms and conditions contained in this Agreement, DISH agrees to permit Network to use DISH's name, trade name, service marks, trademarks, and logos (“DISH Marks”) to market the Services to potential Service Subscribers; provided that any such use is subject to DISH's prior written approval with respect to each and every use. DISH's approval shall be deemed to have been withheld if not specifically given. Network acknowledges and agrees that the name, trade name and service mark “DISH Network” and any and all other DISH Marks are the exclusive property of DISH and its Affiliates and that Network has not and will not acquire any proprietary rights in DISH Marks by reason of this Agreement or otherwise. Except as provided in this Agreement, Network shall at no time adopt or use, without DISH's prior written consent, any variation of the DISH Marks, or any work or mark likely to be similar to or confused with the DISH Marks. Any and all goodwill arising from Network's use of the DISH Marks shall inure solely to the benefit of DISH. Uses of the DISH Marks in routine promotional materials such as Internet web-sites, mailers, marketing materials, or in a manner previously approved by DISH, shall be deemed approved for all substantially similar subsequent uses unless DISH specifically notifies Network to the contrary.

9.           MOST FAVORED NATION:

In addition to its representations and warranties to DISH in Section 10(b) below and elsewhere in this Agreement, Network hereby represents and warrants that, at all times during the Term, each term and condition of this Agreement governing carriage of the Service via the Distribution System, including without limitation all economic provisions of this Agreement, are at least as favorable to DISH as the most favorable terms and conditions pursuant to which Network receives carriage by any Other Distributor in the Territory under any other agreement or arrangement for carriage of the Service, whether written or oral (each such agreement or arrangement, an “Other Distributor Agreement”). In the event Network enters into an Other Distributor Agreement, it shall provide written notice thereof to DISH within thirty (30) calendar days after entering into the Other Distributor Agreement (an “MFN Notice”). Each MFN Notice shall include the identity of the Other Distributor and a certification by Network’s Chief Financial Officer as to Network’s compliance with this Section 9 as it relates to such Other

  

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Distributor Agreement, including without limitation a description of any terms that are more favorable to such Other Distributor than the corresponding terms of this Agreement are to DISH and, in DISH’s sole and absolute election, this Agreement shall immediately thereupon be amended to incorporate such more favorable terms for the same period of time that such Other Distributor was and is afforded such more favorable terms. Without limiting the generality of the foregoing, Network’s failure to so notify DISH shall not in any manner whatsoever limit DISH’s rights and remedies hereunder. If Network enters into an agreement with an Other Distributor where the per subscriber license fee is based on a revenue split and, after a retroactive analysis (to be conducted each Reporting Period), the net effective rate per subscriber (“NESR”) to the Service on such Other Distributor’s platform is more favorable than the Monthly Fee per Service Subscriber set forth in this Agreement, then Network shall pay to DISH, within thirty (30) days, the difference for each applicable calendar month. For purposes of this Agreement, NESR shall be calculated based on all direct and indirect economic outlays in connection with or related to the carriage of the Service (each as a stand alone inquiry) payable to or by Network or to or by an Other Distributor whether included in an agreement relating to the Service or otherwise, divided by the applicable number of subscribers to the Service on the relevant platform(s). Network represents and warrants that there are no Other Distributor Agreements with more favorable terms and conditions in effect as of the Effective Date, and it further agrees that it shall at all times during the Term and for one (1) year thereafter maintain complete and accurate books and records relating to its Other Distributor Agreements and DISH shall have the right to audit such books and records (once annually and only through a third party independent auditor that has entered into a non-disclosure agreement with Network) to confirm compliance with this Section 9. In addition, upon the written request of DISH, Network shall provide DISH, within fifteen (15) days of its request, a written certification that is duly executed by an officer of Network, certifying Network’s compliance with this Section 9.

10.           REPRESENTATIONS AND WARRANTIES:

(a)           Mutual Warranties. Each party represents and warrants to the other that: (i) it is duly organized, validly existing and in good standing under the laws of the state or country under which it is organized; (ii) it has the power and authority to enter into this Agreement and to perform fully its obligations hereunder; (iii) the individual executing this Agreement on its behalf has the authority to do so; and (iv) the obligations created by this Agreement, insofar as they purport to be binding on it, constitute legal, valid and binding obligations enforceable in accordance with their terms.

(b)           Network Warranties. Network represents and warrants to DISH that: (i) the Service is of a high quality that at least meets the standards of quality, with respect to audio and visual quality and quality of content, that is standard in the video programming industry; (ii) it presently has and will continue to have, at all times during the Term, all rights necessary (including, without limitation, to grant DISH the right to use the Network Marks) to grant DISH the rights contracted for by DISH under this Agreement free and clear of all liens, restrictions, charges, claims and encumbrances; (iii) it has obtained and will maintain throughout the Term all licenses, permits, exemptions, authorizations and consents necessary to fully perform this Agreement; (iv) it and the Service presently are, and will remain at all times during the Term, in full compliance with the Law, including without limitation all Laws enforced, administered, promulgated or pronounced in the United States and in the country or countries in which the content for the Service originated; (v) it has licensed and will continue to license and be responsible to pay all copyright, royalty or other performance rights and licenses, including without limitation “through-to-the-viewer” music performance rights for the Service and/or any other rights necessary from ASCAP, BMI, SESAC and any other applicable performing rights organizations or other applicable entities, and shall maintain all such rights and licenses throughout the Term; (vi) no third party has or, to the best knowledge of Network, no third party has claimed, any rights which would be inconsistent with the rights granted to DISH in this Agreement; (vii) the Service will not contain any material which is obscene, libelous, slanderous, indecent or defamatory, nor will it contain any material which violates or infringes

  

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any copyright, trademark, right of privacy or literary or dramatic right or any other right of any person or entity pursuant to the Law of the United States and/or applicable to the Territory or any portion thereof; (viii) it is and will remain under no contractual or other legal obligation that in any way interferes with its full, prompt and complete performance under this Agreement; (viii) it will not make any statements or engage in any communications that could be construed to imply that DISH endorses or is in any way responsible for any products, services or other benefits promoted or advertised in connection with the Service or that it is employed by the agent of or in any way under the direction or control of DISH; (x) it will not engage in any direct or indirect communications specifically directed to Subscribers or Service Subscribers (as opposed to general advertising or marketing directed to the Network’s customers) other than as permitted under this Agreement without DISH’s prior written approval in each instance (e.g., Network may not sell, pledge, loan, hypothecate or otherwise use or attempt to use the name of any DISH Subscriber without DISH’s express written consent (this does not affect the Network’s use of its own customers’ names as long as such use is otherwise lawful)); and (xi) it will not engage in any activity in any way connected with signal theft, piracy, or the sale of any equipment which could be used in furtherance thereof or assist any third party in doing so.

(c)           DISH Warranties. DISH represents and warrants to Network that it presently is, and will remain at all times during the Term, in material compliance with all material applicable Laws with regard to its ability to perform its obligations under this Agreement.

11.           INDEMNIFICATION:

(a)           Network’s Indemnification. Network shall indemnify, defend and hold harmless DISH, its Affiliates, and each of their present and future contractors, subcontractors, authorized distributors, authorized Subdistributors, directors, members, shareholders, officers, employees and agents, and each of their respective assigns, heirs successors and legal representatives (collectively, the “DISH Indemnitees”) from, against and with respect to any and all claims, losses, damages, lawsuits, judgments, actions, penalties, liabilities, costs and expenses (including reasonable court costs and attorneys' fees) (collectively, “Claims”) incurred in connection with or arising out of: (i) the breach or alleged breach or default by Network of any provision contained in the Agreement; (ii) the content of the Service (including, without limitation any claims alleging that the transmission of any content is defamatory, libelous, slanderous, obscene, or violates or infringes any copyright, trademark, right of privacy or literary, dramatic or music performance right or any other right of any person or entity or associated in any way with the products that are sold on the Service and/or any drawing game lottery or other game of chance associated with or related to the Service); (iii) the sale or marketing of any products or services by, through or on the Service including, without limitation, claims related to product liability, patent, trademark, copyright infringement, right of privacy or publicity, express or implied warranties, warranties relating to compliance with Laws and personal injuries (physical, economic or otherwise), to any person who may use, consume or be affected by the products and services sold or marketed by, through or on the Service; (iv) Network's or the Service’s failure to comply with all Laws or any other failure on Network's part that causes DISH to violate any Law or court or administrative decree; and (v) Network's failure to have acquired at the pertinent time when all or part of the Service is made available to Affiliate, good title to, and/or each and every intellectual property right or other right necessary for it to satisfy the obligations imposed on it pursuant to this Agreement.; (vi) Network's advertising and marketing of the Service; (vii) Network’s use of the DISH Marks inconsistent with DISH’s instructions; (viii) any other materials relating to the Service, including without limitation advertising or promotional copy supplied or permitted by Network; (ix) any interruptions in the transmission of the Service to DISH; and (x) Network’s closed-captioning obligations set forth in Section 4(d) of this Agreement, including without limitation fines, forfeitures, FCC enforcement actions and associated costs, attorneys’ fees, disbursements and court or administrative costs.

  

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(b)           Procedure. DISH shall promptly notify Network in writing of any Claim for which indemnification is sought (an “Indemnification Claim”). Network shall undertake the defense of the Indemnification Claim and permit DISH to participate in the defense using counsel of its choosing at Network’s expense. If, in the reasonable discretion of DISH, Network fails to diligently pursue an Indemnification Claim for which it is the indemnifying party, then DISH may assume the control of the Indemnification Claim at Network’s expense. DISH, at Network’s cost, will cooperate fully in the defense of the Indemnification Claim. The settlement of any Indemnification Claim, in whole or in part, by DISH, without Network’s prior written consent, shall release the Network from its obligations hereunder with respect to the portion of the Indemnification Claim settled.

12.           INSURANCE:

Network represents, warrants and covenants that it has procured and shall maintain during the Term, at its sole expense, the following insurance coverage from insurers having at least a “Best’s” rating of A-VII: (i) commercial general liability insurance providing coverage, at a minimum, for bodily injury, death, personal injury and property damage occurring or arising out of the performance of this Agreement, premises operations, products/completed operations, independent contractor’s protective coverage and blanket contractual liability for both oral and written contracts at liability limits of not less than (A) $3,000,000 each occurrence for bodily injury and property damage, (B) $3,000,000 in the aggregate for products/completed operations and premises operations, (C) $3,000,000 in the aggregate for independent contractor’s protective coverage and blanket contractual liability, (D) $1,000,000 in the aggregate for personal and advertising injury and (E) $3,000,000 policy general aggregate limit; and (ii) Media Perils Liability insurance (also commonly known as broadcasters' liability or errors and omissions) that, at a minimum, covers Network's media activities, including, without limitation, production of programming, the Service and all elements thereof and all programming licensed or distributed by Network pursuant to this Agreement (including, without limitation, original programming, marketing activities, sales promotions and other activities), with coverage for, at a minimum, the offenses of defamation of character or reputation, invasion of privacy, infringement of trademark, title, slogan, trade name service mark, copyright or misappropriation of ideas, at a liability limit of $3,000,000 in any one (1) policy period and a maximum self-insured retention of $100,000 or such other retention as agreed to by DISH in its sole and absolute discretion. While Network’s coverage under the required policies may be on a “claims-made” basis, Network shall continue to carry Media Perils Liability coverage for two (2) years beyond the termination of this Agreement. Each insurance policy required by this Section 12 shall be endorsed to provide that (E) DISH and its Affiliates are named as additional insureds; (F) the proceeds of the insurance policy are payable to the named insureds as their interests appear; (G) that the policy provides primary and non-contributory coverage to DISH and its Affiliates, irrespective of any insurance carried by DISH or its Affiliates, whether it be primary, excess, contingent or on any other basis; and (H) the insurer waives any rights of subrogation it may have against DISH or its Affiliates.; Network shall provide to DISH certificates of insurance as evidence of maintenance of all insurance policies required by this Section 12 prior to or contemporaneously with the execution of this Agreement. Each certificate shall indicate that (Y) the pertinent insurance policy shall not be canceled or modified except upon delivery of thirty (30) days' prior written notice to DISH and (Z) the words “pertains to all operations and projects performed on behalf of the certificate holder” are included in the description portion of the certificate. Notwithstanding the foregoing, Network shall not make any revisions to any policy that could adversely affect DISH’s rights as specified herein without DISH’s prior written consent. In addition, such certificates shall indicate coverage for the entire Term, or Network shall provide to DISH, not later than prior to the expiration of any policy, a subsequent certificate of insurance as evidence that the pertinent insurance continues in full force and effect. The fulfillment by Network of its obligations in this Section 12 shall not relieve Network of any liability under this Agreement or in any way modify Network’s obligations to indemnify DISH and its Affiliates.

  

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13.           EARLY TERMINATION RIGHTS:

(a)           Termination For Cause. In addition to all other rights to termination specifically set forth in this Agreement or available at law or in equity, either party shall have the right to terminate this Agreement if the other party has (i) breached any of its material obligations under this Agreement (unless the breach is cured within the thirty (30)-day period following receipt of notice of the breach; provided, that if a shorter or longer cure period is provided elsewhere in this Agreement for a particular breach, then such shorter or longer cure period shall apply and, in the case where immediate termination is provided for elsewhere in this Agreement, immediate termination shall apply, and further provided that each party agrees and acknowledges that there are certain breaches which are incapable of being cured and are therefore not subject to the thirty (30) day cure period); (ii) filed a petition in bankruptcy, is insolvent, or has sought relief under any law related to its financial condition or its ability to meet its payment obligations; or (iii) had any involuntary petition in bankruptcy filed against it, or any relief under any such law has been sought by any of its creditors, unless the involuntary petition is dismissed, or the relief is denied, within thirty (30) days after it has been filed or sought. In addition to and without limiting the generality of the foregoing, DISH shall have the immediate right to terminate this Agreement without liability upon notice to Network if (A) any person or entity who, as of the Effective Date, did not possess, directly or indirectly, the power to direct or cause the direction of management or policies of Network, whether by virtue of the ownership of voting stock, by contract or otherwise, later comes into possession of such power; (B) DISH ceases distributing the top ten Nielsen rated programming services then carried by DISH; and/or (C) delivery of the Service by Network to DISH is discontinued or interrupted for a continuous period of fifteen (15) days. In the event DISH elects to terminate this Agreement at any time pursuant to subsection (i) of this Section 13(a), then without limiting DISH’s ability to seek additional damages or remedies available to it under this Agreement, at law or in equity, DISH shall be entitled to retain the full amount of the Deposit as liquidated damages and not as a penalty. The right to terminate in any case shall be in addition to and without limiting any other rights or remedies the terminating party may have.

(b)           Termination For Convenience. In addition to all other rights to termination specifically set forth in this Agreement or available at law or in equity, DISH shall have the right to terminate this Agreement without cause by providing written notice to Network at least thirty (30) days prior to the date on which such termination shall take effect.

 

 

14.           NOTICES:

All notices, reports and consents in connection with this Agreement shall be in writing and shall be sent postage prepaid by certified mail, return receipt requested; by hand delivery; or by Federal Express or similar overnight delivery service, to the other party at the following address (unless either party at any time designates another address for itself by notifying the other party by certified mail, in which case the new address shall be used).

	
To Network:

	
The Real Hip-Hop Network

1455 Pennsylvania Avenue NW, Suite 400

Washington, DC 20004

Attn: Mr. Atonn F. Muhammad

cc: General Counsel/Legal

 

	
To DISH:

	
DISH Network L.L.C.

9601 South Meridian Boulevard

Englewood, Colorado 80112

Attn: Office of the General Counsel,  and

cc:   Senior Vice President, Programming

Notice, report or consent given by hand delivery shall be deemed given on delivery. Notice, report or consent given by certified mail, return receipt requested shall be deemed given the date set forth on the receipt. Notice, report or consent given by Federal Express or similar overnight delivery service shall be deemed given on the next business day following delivery of the notice, report or consent to such service with instructions for overnight delivery.

 

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15.           CONFIDENTIALITY:

(a)           Confidential Information. Neither DISH nor Network shall disclose (orally, in writing, by press release or by public disclosure of any kind or otherwise) to any third party (other than their respective officers, directors and employees, in their capacity as such, and on a need-to-know basis, and each parties' respective auditors, consultants, financial advisors, lenders, attorneys and existing and potential third-party financial investors in Network, the Service or DISH, subject to a confidentiality agreement between the relevant party and such third-party financial investors) any Confidential Information except: (i) to comply with the Law; (ii) to the extent necessary to comply with the valid order of an administrative agency or a court of competent jurisdiction, in which case redacted to the greatest extent possible, in which event the party making such disclosure shall so notify the other as promptly as practicable (and, if possible, prior to making such disclosure) and shall seek confidential treatment of such information; (iii) in order to enforce its rights pursuant to this Agreement; or (iv) if mutually agreed to in writing in advance by DISH and Network. For purposes of this Agreement, “Confidential Information” shall mean all non-public information disclosed by one party to the other in connection with this Agreement, the Service or delivery of the Service including without limitation technical information, technical or marketing tests, product plans, and information with respect to the terms and provisions of this Agreement, including its existence. Network acknowledges and agrees that any and all Subscribers shall be deemed customers of DISH and that any and all information relating to Subscribers including without limitation the names, addresses, and any other personally identifying information of any Subscriber (“Subscriber Information”) shall be Confidential Information. DISH shall have absolutely no obligation whatsoever to (and nothing in this Agreement shall require DISH to) disclose Subscriber Information to Network or anybody acting on Network’s behalf. DISH acknowledges and agrees that Network collects its own customer information independently and any such information so collected shall not be considered Subscriber Information; provided that the use of any information collected (directly or indirectly) through or in connection with the Service shall be limited to fulfilling the purpose of the customer’s disclosure of such information; provided further that such information shall not be disclosed or otherwise transferred in any manner to any third party.

(b)           In addition to the restrictions on the disclosure of Confidential Information contained herein, neither party hereto, nor its officers, employees, agents and representatives shall except as required by law (such requirement to be confirmed by a written legal opinion to the other party), make any Public Announcements or other disclosures relating to its discussions, negotiations, and/or the terms of any potential agreement or relationship with the other party or any of its Affiliates without the prior written approval of such other party. For the purpose of this Agreement, “Public Announcement” shall mean the disclosure to any person or entity other than those persons or entities permitted to receive Confidential Information pursuant to the terms hereof, by any means including, but not limited to, a press release; a written or oral statement made to the media, trades, publications or any other public audience or unauthorized third party; a written or oral statement published on Network’s website or on another

  

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Internet site or chat room and/or distributed by facsimile, email, voicemail, regular mail, private delivery service, newsletter and/or recorded message.

(c)           Equitable Relief. Each party agrees that a breach of this Section 15 will result in the substantial likelihood of irreparable harm and injury to the other party for which monetary damages alone would be an inadequate remedy, and which damages are difficult to accurately measure. Accordingly, each party agrees that the other party shall have the right, in addition to any other remedies available to it, to obtain immediate injunctive relief as well as other allowable equitable relief for any breach or potential breach of this Section 15. The right to equitable relief will be in addition to any other right or remedy available under this Agreement, at law or in equity.

16.           MISCELLANEOUS:

(a)           Assignment. This Agreement shall inure to the benefit of and be binding upon, the parties hereto and their respective heirs, legal representatives, successors and assigns. Notwithstanding the foregoing, neither party may assign or otherwise transfer any of its rights or obligations under this Agreement, in any manner, direct or indirect, contingent or otherwise, in whole or in part, voluntarily or by operation of law without the prior express written consent of the other party to this Agreement, except that DISH may assign this Agreement in whole or in part to an Affiliate at any time without the consent of Network. In furtherance and without limitation of the foregoing, a change in control of Customer will be considered an assignment requiring DISH’s consent hereunder, where “change of control” means a change in the ownership or operation of Customer or substantially all of Customer’s assets during the Term whether pursuant to a single transaction or series of transactions, whether by operation of Law or otherwise, the result of which is that a new person or group of persons: (i) has the ability to (A) elect or control the votes of the majority of the board of directors or other governing body of Operator, (B) control more than thirty percent (30%) of the voting interests of Customer or (C) direct or cause the direction of the general management and policies of Customer. Notwithstanding the foregoing, DISH shall have the right to assign some or all of its rights and/or obligations under this Agreement, without obtaining the consent of Network, to (i) an Affiliate; (ii) a successor entity to its business, whether by merger or by sale of all or  substantially all of its assets or stock; (iii) any entity in which DISH or its Affiliates have any direct or indirect equity investment; and (iv) any other entity Controlled by any of the foregoing. In the event of any valid assignment of this Agreement in accordance with the terms of this Section 16(a), the assigning party shall be relieved of all obligations arising after the assignment, and the non-assigning party shall look solely to the assignee for enforcement of such obligations. Notwithstanding anything to the contrary herein, Network shall not assign or otherwise transfer any of its rights or obligations under this Agreement to a competitor of DISH.

(b)           NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, EXCEPT WITH RESPECT TO THE CONFIDENTIALITY AND INDEMNIFICATION OBLIGATIONS CONTAINED IN THIS AGREEMENT, IN NO EVENT SHALL DISH OR ITS AFFILIATES BE LIABLE FOR ANY INCIDENTAL, INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER FORESEEABLE OR NOT, OCCASIONED BY ANY FAILURE TO PERFORM OR THE BREACH OF ANY OBLIGATION UNDER THIS AGREEMENT FOR ANY REASON WHATSOEVER, WHETHER BASED ON NEGLIGENCE OR OTHERWISE AND WHETHER FORESEEABLE OR NOT. IN NO EVENT SHALL DISH OR ANY AFFILIATE OF DISH BE REQUIRED TO SPECIFICALLY PERFORM ANY OBLIGATION CREATED HEREBY. IN NO EVENT SHALL THE AGGREGATE LIABILITY OF DISH AND ITS AFFILIATES IN CONNECTION WITH THIS AGREEMENT EXCEED THE FEES ACTUALLY PAID BY NETWORK TO DISH DURING THE TERM.

  

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(c)           Allocation of Risk. The parties acknowledge and agree that the limitations of liability in this Agreement and the allocation of risk herein are an essential element of the bargain between the parties, without which neither party would have entered into this Agreement.

(d)           Choice of Law and Jurisdiction. This Agreement and all matters or issues collateral thereto shall be governed by the laws of the State of Colorado, without regard to the conflict of law rules thereof. The Federal and state courts located in the State of Colorado shall have exclusive jurisdiction to hear and determine any claims, disputes, actions or suits which may arise under or out of this Agreement and each party hereby waives its and its present and future Affiliates’ right to make any claim to the contrary.

(e)           Relationship. Nothing in this Agreement shall be construed or implied to create a relationship of agency, partners, affiliates, joint employers, or joint venturers. Neither party shall have the power or authority to act for the other in any manner or to create obligations or debts which would be binding on the other. Neither party shall be responsible for any obligation of the other or be responsible for any act or omission of the other or any employee of the other. Network shall be responsible for all wages, salaries, taxes and expenses incurred for or by its employees. Neither party shall be, or hold itself out as, the agent of the other or as joint venturers under this Agreement. No Subscriber shall be deemed to have any privity of contract or direct contractual or other relationship with Network and no supplier of advertising or programming or anything else included in the Service by Network shall be deemed to have any privity of contract or direct contractual or other relationship with DISH by virtue of this Agreement. Network disclaims any present or future right, interest or estate in or to the transmission facilities of DISH and its Affiliates, such disclaimer being to acknowledge that neither DISH nor its facilities are common carriers.

(f)           Force Majeure. Notwithstanding any other provision in this Agreement, neither Network nor DISH shall have any liability to the other or any other person or entity with respect to any failure of Network or DISH, as the case may be, to transmit or distribute the Service or perform its obligations under this Agreement if the failure is due to any failure or degradation in performance of DISH’s or Network’s satellite(s) or any transponder on such satellite(s) or any failure or degradation of the Distribution System, or of any scrambling/descrambling equipment or any other equipment owned or maintained by others (including, without limitation, DISH’s automated billing and authorization system), any failure at the origination and uplinking center used by Network or DISH (including without limitation

the Facility), any labor dispute, fire, flood, riot, legal enactment, government regulation, Act of God, or any cause beyond the reasonable control of Network or DISH, as the case may be (a “Force Majeure Event”) (provided that, with respect to Network’s delivery technologies, a failure of Network’s delivery technologies shall not be considered a Force Majeure Event unless both of Network’s primary and back-up delivery technologies required under this Agreement fail at the same time), and such non-performance shall be excused for the period of time such failure(s) causes non-performance; provided, however, that if DISH determines in its sole discretion that it is commercially or technically unfeasible to cure a Force Majeure Event with respect to the Distribution System or satellite and so notifies Network, then either party may terminate this Agreement effective upon written notice to the other party. The parties acknowledge and agree that although the Service may at any given time be uplinked to only one of several satellites, failure or degradation in any of the satellites may require DISH to reduce the number of programming services available for allocation among all of the satellites, with such reduction including, without limitation, curtailment or termination of the distribution of the Service by DISH, at DISH’s sole discretion. Accordingly, DISH shall have no liability for its failure to distribute the Service in the event of a failure or degradation of any of the satellites or the transponders on any such satellites, regardless of whether the satellite to which the Service is uplinked at the time of the failure or degradation is itself the subject of the failure or degradation.

(g)           Preemptions. DISH shall have the right to preempt the Service, in whole or in part: (i) whenever such preemption is reasonably necessary to fulfill obligations imposed by the Federal Communications

  

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Commission or other regulatory, legal or governmental authorities; (ii) if any satellite or transponder transmitting DISH Network Programming fails or malfunctions in whole or in part, or in DISH's sole discretion requires maintenance, testing, or relocation; (iii) to transmit Other DISH Content; and/or (iv) for any reason or no reason at DISH’s sole discretion (any of the foregoing, a “Preemptive Event”). DISH agrees to provide Network with as much notice of any Preemptive Event as is practicable under the circumstances. Under no circumstances shall DISH or its Affiliates be liable to Network or to any third party for any claims and/or damages whatsoever, resulting from or arising out of a Preemptive Event, except that, unless such preemption is as a result of occasional maintenance permitted hereunder or any breach by Network of any provision hereunder, Network shall not be responsible for payment for airtime during any Preemptive Event.

(h)           Severability. The invalidity under applicable Law of any provision of this Agreement shall not affect the validity of any other provision of this Agreement. In the event that any provision in this Agreement is determined to be invalid, unenforceable or illegal, (A) the provision shall be reformed to the minimum extent necessary to cause the position to be valid, enforceable and legal while preserving the intent of the parties as expressed in, and the benefits to the parties provided by, this Agreement or (B) if the provision cannot be so reformed, the provision shall be severed from this Agreement and the remainder of the Agreement shall remain effective and shall be construed in accordance with its terms as if the invalid, unenforceable or illegal provision were not contained in the Agreement.

(i)           Survival. Any provision of this Agreement which logically would be expected to survive termination or expiration of the Agreement shall survive termination or expiration. In addition to and not in limitation of the foregoing, all representations, warranties, covenants, indemnifications, confidentiality obligations, audit rights and limitations of liability shall survive the termination or expiration of this Agreement.

(j)           No Inference Against Author. Network and DISH each acknowledge that this Agreement was fully negotiated by the parties and, therefore, no provision of this Agreement shall be interpreted against either party because that party or its legal representative drafted the provision.

(k)           Headings; References. The titles and headings of the sections in this Agreement are for convenience only and shall not in any way affect the interpretation of this Agreement. Any reference in this Agreement to a “section” or an “exhibit” shall, unless the context expressly requires otherwise, be a reference to a “section” in, or an “exhibit” to this Agreement. Any reference in this Agreement to the singular form of a word shall automatically include the plural form of the word, if applicable, and any reference to the plural shall include the singular, if applicable. Forms of the word “include” means “including, without limitation;” and references to “hereunder”, “herein”, “hereof”, and the like, refer to this Agreement.

(l)           Waivers; Cumulative Remedies. The failure of either party to insist upon strict performance of any provision of this Agreement shall not be construed as a waiver of any subsequent breach of the same or similar nature. Any waiver of any provision of this Agreement must be in writing. All rights and remedies reserved to either party shall be cumulative and shall not be in limitation of any other right or remedy which such party may have at law or in equity.

(m)           Integration. This Agreement, together with any documents and exhibits specifically referred to in this Agreement, constitute the entire agreement between the parties to this Agreement. All exhibits referenced in this Agreement are hereby incorporated in the Agreement by this reference. This Agreement may not be modified except in a writing executed by both parties. Except as expressly provided by this Agreement, no party shall be bound by any communications between them on the subject matter of this Agreement unless the communication is: (i) in writing; (ii) bears a date contemporaneous with or

  

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subsequent to the date of this Agreement; and (iii) is agreed to by both parties. On execution of this Agreement, all prior agreements and understandings between the parties shall be terminated, including without limitation that certain Long Form Distribution Term sheet dated November 11, 2011 between the parties. The parties specifically acknowledge there are no unwritten side agreements or oral agreements between the parties which alter, amend, modify or supplement this Agreement.

(n)           Change in the Law. Notwithstanding anything to the contrary contained in this Agreement, to the extent that any Law is changed in a way that makes any term of this Agreement illegal or unenforceable, or changes the intent (including without limitation the economic, marketing, packaging or other intent) of any provision of this Agreement, or of this Agreement as a whole, the parties shall negotiate in good faith regarding a modification of the Agreement to account for such change in the Law.

(o)           Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original and all such counterparts together shall constitute but one and the same instrument.

(p)           No Third Party Beneficiaries. The provisions of this Agreement are for the exclusive benefit of the parties to the Agreement and their permitted assigns, and no third party shall be a beneficiary of, or have any rights by virtue of, this Agreement.

 

 

 

Page 19 of 19ex103.htm

Exhibit 10.3

 

 

EXECUTION VERSION

AGREEMENT

“THE REAL HIP-HOP NETWORK”

 

DIRECTV, INC.

and

“REAL HIP-HOP NETWORK BROADCAST, CORP.”

 

 

 

  

 

  

EXECUTION VERSION

AGREEMENT

AGREEMENT, made as of May 8, 2013, by and between “REAL HIP-HOP NETWORK BROADCAST CORPORATION”, a Delaware Corporation] (“Programmer”), and DIRECTV, INC., a California corporation (“Affiliate”).

WHEREAS:

A.           Affiliate has established a direct to home (“DTH”) satellite-based television system in North America; and

B.           Programmer desires to purchase time on the DIRECTV Distribution System (as defined in Section 1.2.2 below) for the distribution of “The Real Hip-Hop Network” the “Service,” as defined in Section 1.3.1 below).

 

NOW, THEREFORE, IT IS MUTUALLY AGREED AS FOLLOWS:

 

1.           Term; Grant of Rights.

1.1           Term; Extension; Service Commencement Date. The term of this Agreement shall be for the period commencing on the date hereof and ending on the first anniversary of the Service Commencement Date (the “Term”). Affiliate shall have the option to extend the Agreement for one (1) additional year upon notice to Programmer at least sixty (60) days prior to the scheduled expiration of the Term (and the “Term” shall be deemed to include any such extension period). The “Service Commencement Date” means the date on which Affiliate commences distribution of the Service via the DIRECTV Distribution System for revenue-generating purposes, which date shall be on or about December 1, 2013

1.2           Distribution; Certain Definitions.

 

1.2.1           Distribution Rights. Programmer hereby grants to Affiliate the non-exclusive right to distribute the Service in the United States, its territories and possessions (the “Territory”) via the DIRECTV Distribution System to DIRECTV Subscribers (as defined in Section 1.2.2 below) during the Term hereof.

 

1.2.2           Certain Definitions. The term “DIRECTV Distribution System” shall mean the distribution system for video and other programming services whereby the programming satellite signal or feed is received from Programmer’s delivery source by a DIRECTV turnaround earth-station facility which compresses and processes the signal or feed and then uplinks it to a DTH communications satellite (a “DTH Satellite”) for transmission to DIRECTV Subscribers. The DIRECTV Distribution System also shall include any other method of distribution that Affiliate currently and/or subsequently uses to deliver the Service feed to DIRECTV Subscribers, including, without limitation, MMDS, broadband, Internet, Internet protocol, fiber optic, twisted pairs and coaxial cable, provided that in connection with such delivery methods, Affiliate complies with the following: (i) the end users to whom Affiliate distributes the Service are DIRECTV Subscribers, (ii) such delivery is made via a secure distribution path to such DIRECTV Subscribers and expressly

  

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excludes any open distribution to the general public, and (iii) any change to Affiliate’s current delivery system does not require material costs by Programmer, in which case Programmer shall be entitled to terminate this Agreement (unless Affiliate agrees to promptly reimburse Programmer for the material incremental delivery costs). “DIRECTV Subscribers” shall mean those customers (both residential and non-residential) authorized by Affiliate to receive service via the DIRECTV Distribution System.

1.3           The Service.

1.3.1           The “Service” shall mean and consist of the national feed (or, if Programmer uses multiple feeds for the Service, such other of such multiple feeds designated by Affiliate) of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described on Exhibit “A” attached hereto, presented on a 24-hour per day, 7 days a week schedule. No other types of programming, including but not limited to, religious programming, and children’s programming, shall be permitted. At all times the programming on the Service shall meet the description set forth at Exhibit A hereto and, in no event, shall the Service contain (i) any sexual dialogue or situations, nudity, profanity, violence, obscene gestures or similarly objectionable material (i.e., it shall be suitable for a general audience), (ii) any crawls or other mentions disparaging DIRECTV or its Affiliated Companies, or (iii) via Infomercials or other Service programming, the sale of products competitive to the DIRECTV service. Affiliate shall determine the channel position in its sole discretion (or such channel position as determined by Affiliate from time to time, however, Affiliate shall give Programmer at least thirty (30) days prior written notice of any such channel position change).

1.3.2           All rights and title in and to the entire contents of the Service, including, but not limited to, films and recordings thereof, title or titles, names, trademarks, concepts, stories, plots, incidents, ideas, formulas, formats, general content and any other literary, musical, artistic, or other creative material included therein shall, as between Programmer and Affiliate, remain vested in Programmer.

1.3.3           Affiliate is authorized to distribute the Service using satellite master antenna television system (or similar terrestrial-based transmission infrastructures) (“SMATV”) operators (including telephone companies and similar service providers) that serve multiple dwelling locations, master planned communities, multiple dwelling unit buildings or complexes or commercial or business establishments with multiple television viewing sites via such SMATV systems directly to end users within such buildings or establishments.

 

 

1.3.4           Programmer shall not propose or impose upon Affiliate, nor shall Affiliate be obligated to pay, any surcharge or other cost for receipt and distribution of the Service.

1.4           Other Distribution Obligations. In addition, the parties agree as follows:

1.4.1            Subject to Programmer’s obligations hereunder and Affiliate’s rights under Section 16, Affiliate shall distribute the Service as transmitted by Programmer, in its entirety, in the order and at the time transmitted by Programmer without any intentional and willful editing, delays, alterations, interruptions, deletions or additions (collectively, the “Alterations”) excepting: (i) Affiliate’s electronic guides (including without limitation, any mosaic or similar guides), (ii) news bulletins and other public announcements as may be required by emergencies or applicable law; and

  

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(iii) a DIRECTV Subscriber’s use of equipment, programming or other data supplied by Affiliate or any third party to make Alterations to the signal as viewed on a monitor/television screen. Programmer acknowledges that the DIRECTV Distribution System requires and applies digital compression and encryption processes prior to transmission and decryption and decompression processes upon reception and agrees that such processing does not constitute an alteration and/or other modification of the Service.

1.4.2           Programmer shall, at its sole expense, deliver the feed of the Service from a U.S. domestic communications satellite commonly used for transmission of television programming in the Territory (the “Delivery Source”) to each of Affiliate’s uplink and broadcast facilities currently located in Los Angeles, California (the “Broadcast Center”). In connection with the foregoing, Programmer shall, at its sole cost and expense, provide Affiliate with two receivers and decoders for the Service for each of the Broadcast Centers. Affiliate shall be responsible for all costs of signal delivery from Affiliate’s headend to DIRECTV Subscribers. In the event Programmer seeks to change the primary delivery mechanism from which the Service is delivered at any time during the Term, Programmer shall provide Affiliate with not less than one hundred and twenty (120) days’ prior written notice of such proposed change and, in the event Affiliate approves such change, Programmer shall provide Affiliate with the necessary equipment for both Broadcast Centers required to receive the Service, via the new delivery method. The delivery of all feeds hereunder shall be pursuant to the technical specifications set forth at Exhibit “B” hereto (as such Exhibit may be amended by Affiliate from time to time).

1.4.3           Programmer and Affiliate shall use their respective commercially reasonable efforts to maintain for the Service a high quality of signal transmission in accordance with their respective technical standards and procedures. Programmer agrees to include closed-captioning of the audio portion of the Service as delivered by Programmer to Affiliate in a manner sufficient to allow Affiliate to comply with any closed-captioning obligations as may be imposed upon Affiliate or Programmer by the rules and regulations of the Federal Communications Commission (“FCC”) or other governmental body during the Term, as modified from time to time, and Programmer shall provide Affiliate certificates of compliance in connection with the above obligations on a quarterly basis during the Term. Other than as required pursuant to the immediately preceding sentence, Affiliate shall have no liability in connection with Programmer’s failure to prepare, insert or include closed-captioning in the Service as required by this Section 1.4.3. Accordingly Programmer shall indemnify, defend and hold harmless Affiliate, as provided in Section 8 hereof, against and from any and all losses, liabilities, claims, costs (including without limitation, any costs of preparing and including closed-captioning and/or video description in the Service), damages and expenses, including without limitation, fines, forfeitures, attorneys’ fees, disbursements and court or administrative costs, arising out of Programmer’s breach of this Section 1.4.3.

1.5           Program Guide. During the Term, Programmer, at its sole cost and expense, shall provide the daily programming schedule for the Service to Tribune Media Service (or such other service designated by Affiliate) in order that Affiliate may access the program schedule for purposes of the on-screen program guide. Affiliate shall, at its expense, include the Service in its electronic program guide under the listing “RHN”.

1.6           On-Screen Logos. It is understood and agreed that Affiliate may superimpose a logo or “bug” in a corner of the screen identifying Affiliate over the programming of the Service; provided, however, that (i) Affiliate’s bug shall appear only intermittently during any portion of the Service, (ii) Affiliate shall not delete the Service’s own promotion bug or its on-screen graphics, and

  

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(iii) the Service will be treated in a nondiscriminatory manner vis-à-vis other comparable programming services.

1.7           Must Carry Waivers. Programmer represents and warrants that it does not provide on a weekly basis, either directly or indirectly, fifty percent (50%) or more Service programming to any full power local broadcast stations licensed in any “designated market areas” (defined in 17 U.S.C. §122(j)(2)(C)) (“DMA”) served by the DIRECTV Distribution System. If, at any time during the Term Programmer does provide fifty percent (50%) or more Service programming to any such station, Programmer shall obtain an agreement from the owner and operators of such station (each, an “Station”), whereby said owner and operators (including Programmer, if applicable) shall agree not to assert, exercise, elect or seek in any fashion to enforce any and all rights arising from or under the Must Carry Rights (as defined below) for their respective Station during the Term of this Agreement, and said agreement shall be in the form and substance provided by Affiliate (the “Must Carry Waiver”). For purposes of this Agreement, “Must Carry Rights” means the statutory provisions of 47 U.S.C. § 338 and 17 U.S.C. §§ 122 and 501, as amended; the regulations adopted by the FCC implementing these statutory provisions, currently codified at 47 C.F.R. 76.66 et seq., as those regulations may be amended from time to time; and the requirements of applicable decisions of the FCC or federal courts interpreting such statutory provisions or regulations.

1.8           Liquidated Damages. Affiliate and Programmer agree that, in the event of a breach of Section 1.7 above (i.e., assertion or enforcement of the Must Carry Rights for any Station), then in addition to Affiliate’s other rights and remedies pursuant to this Agreement, at law or equity, Programmer shall pay to Affiliate the sum of $400,000 annually as liquidated damages for each Station that is the subject of such breach. Programmer recognizes and agrees that this sum is a reasonable assessment of the damagers that will follow from the improper assertion of enforcement of the Must Carry Rights.

1.9           Preemptions. The parties agree that Affiliate may preempt the Service due to Affiliate’s coverage of live or taped sporting or entertainment events; provided, however, that in such event the Fee will be credited based on the number of hours the Service is preempted pursuant to the Rate Equivalent Chart at Exhibit “D” hereto. Affiliate will provide Programmer with as much advance notice as possible for any such preemptions.

1.10           Technical and Customer Support. Programmer shall provide live master control and customer service support for the Service on a 24-hour, seven-day-a-week basis throughout the Term.

2.           Payments.

2.1           Payments. Programmer shall pay to Affiliate the net rates per week set forth at Exhibit “C” hereto (the “Fee”) as consideration for Affiliate’s distribution of the Service. Payment of the applicable Fee shall be made by Programmer every two (2) weeks during the Term on a strict two (2) week cash in advance basis, with payments due to Affiliate by the close of business on the Monday two weeks prior to the Monday that is the “week of air” date. DIRECTV shall submit a summary of payments due to Programmer by the Thursday prior to the Payment Due Date. Notwithstanding anything herein to the contrary, Programmer acknowledges and agrees that during any period of time for which the Fee has not been paid in full in accordance with the terms of this Section 2.1, DIRECTV shall have no obligation to distribute the Service and Affiliate may

  

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discontinue distribution of the Service immediately and without notice. Affiliate’s discontinuation of distribution of the Service as provided for above shall be without prejudice to Affiliate’s right to seek termination of this Agreement as provided for elsewhere in this Agreement.

2.2           Non-Refundable Deposit. Programmer acknowledges and agrees upon execution of this Agreement, Affiliate will incur certain costs and expenses in order to reserve space on its system to launch Service (including, without limitation, lost fees for foregoing to release such space to other providers of content). As such, Programmers agrees to a one time non-refundable deposit to Affiliate in the amount of $522,000 (the “Deposit”) concurrently with the execution of this Agreement. Programmer and Affiliate acknowledge and agree The Deposit shall be non-refundable; provided however, that (i) in the event there is no material breach by Programmer under this Agreement during the term, the Deposit shall be applied against Programmer’s last payment due under this Agreement or (ii) in the event of a material breach of this agreement by Programmer at any time during the Term (including, without limitation, Programmer’s failure to comply with strict 2 week cash in advance payment provision outlined under Section 2.1 above and/or Programmer’s failure to launch the service Commencement Date in accordance with terms of this agreement), the Deposit shall be forfeited by Programmer at the time of such breach of this agreement by Programmer shall in no way limit any other rights or remedies available to affiliate, at law or otherwise, under this agreement.

2.3           Late or Non-Payments. In addition to any other rights and remedies available to Affiliate under this Agreement (and not in lieu thereof), any amounts that are not paid by Programmer after the date payment is due pursuant to Section 2.1 shall accrue interest at the rate of one percent (1%) per month or at the highest lawful rate, whichever shall be the lesser, from the date such amounts were due until they are paid. Programmer shall be liable for all reasonable costs and expenses (including, without limitation, reasonable court costs and attorneys’ fees) incurred by Affiliate in collecting any past due payments.

2.4           Most Favored Nation.

2.4.1           Programmer agrees that if, at any time during the Term (or any portion thereof), Programmer allows (including, without limitation, by way of agreements that Programmer previously entered into) any other distributor to distribute the Service (or any successors thereto or variations thereof) in the Territory or in any portion thereof via any means of television distribution (including satellite, cable, broadcast or telco) (“Other Distributor”) at a net weekly rate that is higher than the net weekly rate paid to Affiliate hereunder (“Favored Fees”), then Programmer shall promptly notify Affiliate in writing of such Favored Fees and Affiliate shall be immediately entitled to incorporate into this Agreement the Favored Fees effective as of the first day on which Programmer first allows such Other Distributor to distribute the Service in exchange for the Favored Fees. Nothing in the preceding sentence shall require Affiliate to incorporate the Favored Fees into this Agreement.

2.4.2           At Affiliate’s election, Programmer shall (i) permit Affiliate’s independent representatives, which shall have first entered into a reasonable and customary nondisclosure agreement with Programmer, to review, during the Term (no more than once each calendar year) and for one (1) year and on a one-time basis only thereafter, such Programmer records as required for the sole purpose of verifying Programmer’s compliance with the terms of Section 2.4.1, at reasonable times, upon reasonable advance written notice and during normal business hours at Programmer’s offices, or (ii) provide to Affiliate an annual statement, certified by Programmer’s

 

 

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chief financial officer, certifying compliance with the provisions of Section 2.4.1. Such review shall be at Affiliate’s sole cost and expense, unless such review reveals an underpayment to Affiliate of more than five percent (5%), in which case, Programmer shall promptly reimburse Affiliate for the reasonable cost of such audit and shall promptly make payment of any monies due and owing, provided Programmer does not have a bona fide dispute with the audit findings. The information derived from and the process of such review shall be subject to the confidentiality provisions of Section 15, and any third party auditor shall be required to acknowledge in writing its agreement to such confidentiality provisions.

3.           Intentionally Omitted.

4.           Packaging and Marketing.

4.1           Packaging. Affiliate shall determine the packaging of the Service in its sole discretion; provided that, at a minimum, Affiliate shall distribute the Service in its most highly penetrated package of programming services, which is currently “Total Choice.”

4.2           Programmer’s Sales and Marketing Materials. Programmer shall provide Affiliate, upon Affiliate’s request, with promotional and marketing advice for purposes of Affiliate’s marketing of the Service. Programmer shall promptly provide Affiliate, upon the same terms as provided to any Other Distributor, with any and all promotional, marketing or other related or similar materials of (or related to) the Service which it produces or provides to such Other Distributor. Programmer shall promote Affiliate’s carriage of the Service at least as favorably as it promotes the carriage of the Service by an Other Distributor (including, without limitation, the frequency, prominence and calling by specific name).

5.           Representations, Warranties and Covenants.

5.1           By Affiliate. Affiliate warrants, represents and covenants to Programmer that it:

5.1.1           is in compliance with and will comply with all material Laws (as defined below) with respect to its rights and obligations under this Agreement, including without limitation, all relevant provisions of the Cable Television Consumer Protection and Competition Act of 1992 (as may be amended and any successor, replacement or similar Law or statute) and any and all regulations issued pursuant thereto. As used herein, “Law” shall mean any FCC and any other governmental (whether international, federal, state, municipal or otherwise) statute, law, rule, regulation, ordinance, code, directive and order, including without limitation, any court order;

5.1.2           has the power and authority to enter into this Agreement and to fully perform its obligations hereunder and, once executed, this Agreement shall constitute a legal, valid and binding obligation of Affiliate enforceable in accordance with its terms;

5.1.3           shall distribute the Service in the Territory in accordance with and subject to the terms and conditions set forth in this Agreement;

5.1.4           shall not, without Programmer’s consent, knowingly authorize or cause or knowingly permit any portion of the Service to be recorded, duplicated, cablecast, exhibited or otherwise used (except on a videocassette recorder or other home or personal taping device for

  

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private, noncommercial use) for any purpose other than for distribution by Affiliate at the time the same is made available;

5.1.5           shall not, without Programmer’s prior written approval, use the names, titles or logos of the Service or any of its programs, or the names, voices, photographs, likenesses or biographies of any individual participant or performer in, or contributor to, any program or any variations thereof, for any purpose other than in material intended to advise DIRECTV Subscribers or potential DIRECTV Subscribers of the availability and scheduling of the Service or as a channel identifier. The restrictions set forth in this Section 5.1.5 shall apply only to the extent they are applied by Programmer uniformly with respect to all of its distributors of the Service, and shall not apply if Affiliate has received a valid authorization from a third party for any of the uses described in this Section 5.1.5; and

5.1.6           has obtained, and shall maintain in full force during the Term hereof, such international, federal, state and local authorizations as are material and necessary to operate the business it is conducting in connection with its rights and obligations under this Agreement.

5.2           By Programmer. Programmer warrants, represents and covenants to Affiliate that:

5.2.1           it is in compliance with and will comply with all material Laws with respect to its rights and obligations under this Agreement, including without limitation, all relevant provisions of the Cable Television Consumer Protection and Competition Act of 1992 (as such Law may be amended and any successor, replacement or similar Law or statute) and any and all regulations issued pursuant thereto;

5.2.2           it has the power and authority to enter into this Agreement and to fully perform its obligations hereunder and once executed this Agreement shall constitute a valid and binding agreement of Programmer enforceable in accordance with its terms;

5.2.3           the general quality and quantity of programming on the Service shall not materially change from that existing as of the date of this Agreement, and the genre of programming shall not materially change from that described in Section 1.3.1 and existing on the date of this Agreement;

5.2.4           it has obtained, and shall maintain in full force during the Term hereof, such federal, state and local authorizations as are material and necessary to operate the business it is conducting in connection with its rights and obligations under this Agreement;

5.2.5           it has secured and shall maintain in full force during the Term hereof all rights necessary for Affiliate to use and enjoy its rights in connection with its distribution of the Service, including, without limitation, obtaining all necessary trademarks, copyrights, licenses and any and all other proprietary intellectual property and other use rights necessary in connection with, and for Affiliate’s distribution of, the Service and to perform its obligations hereunder and grant the rights granted pursuant to Section 1;

5.2.6           it shall not, without Affiliate’s prior written approval, use the name or logo for “DIRECTV” or any other works owned or controlled by Affiliate (and its Affiliated Companies); provided that, without Affiliate’s prior approval, Programmer shall be permitted to list

  

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Affiliate’s name in materials distributed to clients, advertisers and programmers identifying the sources of distribution of the Service;

5.2.7           as of the date hereof, the programming on the Service consists of and during the Term hereof such programming shall consist of, that programming described in Section 1.3.1 (including Exhibits A and B);

5.2.8           there are no (and it covenants that it shall not, during the Term, enter into directly or indirectly, allow or otherwise permit any) affiliation, distribution or any other agreements, whether written or oral, granting to distributors and/or any other third party, person or entity any form or type of exclusive or other rights that would limit or restrict in any way Affiliate’s rights as granted herein to distribute the Service in the Territory;

5.2.9           Programmer is in compliance with all applicable Laws relating to the distribution of the Service (including without limitation, all applicable provisions of the Children’s Television Act of 1990 and the closed captioning requirements as set out in FCC regulations under 47 C.F.R.§79.1), with which the failure to comply would result in a material adverse effect on Affiliate; and

5.2.10                      it is in compliance with and will comply with the most favored nations provision set forth in Section 2.4 hereof.

6.           Termination.

6.1           Termination for Breach, Bankruptcy; Discontinuance of Business. Without limiting any other rights or remedies available to the applicable party under this Agreement, in equity, at law or otherwise, this Agreement may be terminated by either party, (the “Affected Party”), in its discretion, at any time after any of the following occurrences, except as provided in this Agreement, with respect to the other party (the “Other Party”):

6.1.1           any breach of any material representation, warranty or covenant made herein or the failure by the Other Party, its successors or assigns to perform any material obligation hereunder which is not cured within thirty (30) days after receipt of written notice thereof from the Affected Party; provided, however, that Programmer shall not be entitled to a cure period for a failure by Programmer to timely pay to Affiliate the Fee due under Section 2 of this Agreement;

6.1.2           the filing of a petition in bankruptcy or for reorganization by or against the Other Party under any bankruptcy act; the assignment by the Other Party for the benefit of its creditors, or the appointment of a receiver, trustee, liquidator or custodian for all or a substantial part of the Other Party’s property, and the order of appointment is not vacated within thirty (30) days; or the assignment or encumbrance by the Other Party of this Agreement contrary to the terms hereof; or

6.1.3           if Affiliate discontinues operation of the DIRECTV Distribution System, or Programmer discontinues operation and distribution of the Service. Neither party shall have any further liability to the other, other than as set forth in Section 6.5 below, for the discontinuance of the DIRECTV Distribution System or the Service, as the case may be; provided that such discontinuance is not in connection with, and does not arise from, Affiliate’s or Programmer’s breach of this Agreement.

  

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6.2           Termination by Affiliate. Without limiting any other rights or remedies available to it under this Agreement, in equity, at law, or otherwise, Affiliate may terminate this Agreement:

6.2.1           at any time that Programmer is not in compliance with the strict two-week cash in advance payment obligation pursuant to Section 2.1 hereof;

6.2.2           in the event of a Programmer Transfer (as defined below) other than (i) with Affiliate’s prior written consent, (ii) as the result of a merger into or sale or transfer directly or indirectly to a wholly-owned subsidiary of Programmer, (iii) or a transfer of a percentage of the assets or stock ownership of Programmer or the Service where Programmer retains ownership of at least fifty percent (50%) of the assets or stock thereof. “Programmer Transfer” shall mean a change in the ownership of Programmer (or the parent of Programmer) or any assignment, conveyance, exclusive license, transfer or disposition of all or substantially all of the assets or business of Programmer (or the parent of Programmer), whether by operation of law or otherwise, the result of which is that a new entity, person or group of persons, directly or indirectly, has the ability (x) to elect or control the votes of the majority of the board of directors or other governing body of Programmer (or the parent of Programmer), (y) to control more than fifty percent (50%) of the voting interests of Programmer (or the parent of Programmer), or (z) to direct or cause the direction of the general management and policies of the Service or Programmer (or the parent of Programmer); or

6.2.3           at any time, upon at least thirty (30) days prior written notice to Programmer.

6.3           Intentionally Omitted.

6.4           Force Majeure. Notwithstanding any other provision in this Agreement, neither Programmer nor Affiliate shall have any liability to the other or any other person or entity with respect to any failure of Programmer or Affiliate, as the case may be, to transmit or distribute the Service or perform its obligations hereunder if such failure is due to the DTH Satellite(s) or transponders on such satellites (as applicable) or of the DIRECTV Distribution System (in which case, Affiliate shall be excused from its distribution obligations under this Agreement), or of any scrambling/descrambling equipment or any other equipment owned or maintained by others (including, without limitation, Affiliate’s automated billing and authorization system), any failure at the origination and uplinking center used by Programmer or Affiliate, any labor dispute, fire, flood, riot, legal enactment, government regulation, Act of God, or any cause beyond the reasonable control of Programmer or Affiliate, as the case may be (a “Force Majeure”), and such non-performance shall be excused for the period of time such failure(s) causes such non-performance; provided, however, that if either party determines in its sole discretion that it is commercially or technically unfeasible to cure a Force Majeure with respect to the DIRECTV Distribution System and so notifies the other party, then either party may terminate this Agreement effective upon written notice to the other party. The parties acknowledge and agree that although the Services may at any given time be uplinked to only one of several DTH Satellites, failure or degradation in any of such DTH Satellites may require Affiliate to reduce the number of programming services available for allocation among all of the DTH Satellites, with such reduction including, without limitation, curtailment or termination of the distribution of the Service by Affiliate, at Affiliate’s sole discretion. Accordingly, Programmer further acknowledges and agrees that the provisions set forth in the first sentence of this

  

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Section 6.4 shall apply and shall exculpate Affiliate and excuse the performance of Affiliate hereunder in the event of a failure or degradation of any of the DTH Satellites or the transponders on any such satellites, regardless of whether the satellite to which the Service is uplinked at the time of such failure or degradation is itself the subject of such failure or degradation, in which case Programmer shall have the right to terminate this Agreement in whole only at Programmer’s sole discretion. In addition, Programmer shall receive a Fee credit for any periods that Affiliate is unable to perform this Agreement due to a Force Majeure.

6.5           Survival. Termination of this Agreement pursuant to this Section 6 shall not relieve either party of any of its liabilities or obligations under this Agreement, including without limitation those set forth below in Section 8, which shall have accrued on or prior to the date of such termination.

7.           Separate Entities. No officer, employee, agent, servant or independent contractor of either party hereto or their respective subsidiaries or affiliates shall at any time be deemed to be an employee, servant or agent of the other party for any purpose whatsoever, and the parties shall use commercially reasonable efforts to prevent any such misrepresentation. Nothing in this Agreement shall be deemed to create any joint venture, partnership or principal-agent relationship between Programmer and Affiliate, and neither shall hold itself out in its advertising or in any other manner which would indicate any such relationship with the other.

8.           Indemnification; Limitation of Liability.

8.1           By Programmer. Programmer shall indemnify, defend and hold harmless each of Affiliate, its Affiliated Companies (as defined below), Affiliate’s contractors, subcontractors and authorized distributors and the directors, officers, employees and agents of Affiliate, such Affiliated Companies and such contractors, subcontractors and distributors (collectively, the “Affiliate Indemnitees”) from, against and with respect to any and all claims, damages, liabilities, costs and expenses (including reasonable attorneys’ and expert’s fees) incurred in connection with any claim against any of the Affiliate Indemnitees arising out of (i) Programmer’s breach or alleged breach of any provision of this Agreement, (ii) material or programming supplied by Programmer pursuant to this Agreement, (iii) the distribution or cablecast of any programming on the Service that violates or requires payment for use or performance of any copyright, right of privacy or literary, music performance, dramatic or other intellectual property right, or that violates any Law or that infringes upon the rights of any third party, (iv) Programmer’s advertising and marketing of the Service, (v) any other materials, including advertising or promotional copy, supplied or permitted by Programmer, (vi) any false or misleading statements or representations contained in any programming on the Service, (vii) any failure of Programmer or its clients to deliver any advertised product or service, and/or (viii) any product liability. In addition, Programmer shall pay and hold the Affiliate Indemnitees harmless from any international, federal, state, or local taxes or fees which are based upon revenues derived by, or the operations of, Programmer. As used in this Section 8, “Affiliated Company(ies)” shall mean, with respect to any person or entity, any other person or entity directly or indirectly controlling, controlled by or under common control (i.e., the power to direct affairs by reason of ownership of voting stock, by contract or otherwise) with such person or entity and any member, director, officer or employee of such person or entity.

8.2           By Affiliate. Affiliate shall indemnify and hold harmless each of Programmer, its Affiliated Companies, Programmer’s contractors, subcontractors and authorized distributors, each supplier to Programmer of any portion of the Service hereunder and each

  

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participant therein and the directors, officers, employees and agents of Programmer, such Affiliated Companies, such contractors, subcontractors and distributors and such suppliers and participants therein (collectively, the “Programmer Indemnitees”) from, against and with respect to any and all claims, damages, liabilities, costs and expenses (including reasonable attorneys’ and experts’ fees) incurred in connection with any claim against the Programmer Indemnitees arising out of (i) Affiliate’s breach of any provision of this Agreement, (ii) the distribution by Affiliate of the Service via the DIRECTV Distribution System (except with respect to claims relating to the content of the Service for which Programmer is solely responsible), (iii) Affiliate’s advertising and marketing of the Service (except with respect to such advertising and marketing materials or content supplied or approved by Programmer), and (iv) any other materials, including advertising or promotional copy, supplied by Affiliate. In addition, Affiliate shall pay and hold Programmer harmless from any international, federal, state, or local taxes or fees, including any fees payable to local franchising authorities, which are based upon revenues derived by, or the operations of, Affiliate.

8.3           Survival. Termination of this Agreement shall not affect the continuing obligations of each of the parties hereto as indemnitors hereunder. The party wishing to assert its rights set forth in this Section 8 shall promptly notify the other of any claim or legal proceeding with respect to which such party is asserting such right. Upon the written request of an indemnitee, the indemnitor will (i) assume the defense of any claim, demand or action against such indemnitee and/or (ii) allow the indemnitee to participate in the defense thereof, such participation to be at the expense of the indemnitee. Settlement by the indemnitee without the indemnitor’s prior written consent shall release the indemnitor from the indemnity as to the claim, demand or action so settled.

8.4           NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT:

8.4.1           IN NO EVENT SHALL ANY PARTY BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES, WHETHER FORESEEABLE OR NOT, OCCASIONED BY ANY FAILURE TO PERFORM OR THE BREACH OF ANY OBLIGATION UNDER THIS AGREEMENT FOR ANY CAUSE WHATSOEVER, WHETHER BASED ON NEGLIGENCE OR OTHERWISE.

8.4.2            IN NO EVENT SHALL ANY PROJECTIONS, FORECASTS, ESTIMATIONS OF SALES AND/OR MARKET SHARE OR EXPECTED PROFITS, OR OTHER ESTIMATIONS OR PROJECTIONS BY EITHER PARTY OR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR AFFILIATES, REGARDING OR RELATED TO SUCH PARTY’S BUSINESS BE BINDING AS COMMITMENTS OR, IN ANY WAY, PROMISES BY AFFILIATE.

9.           Notices. Except as set forth below, all notices hereunder shall be in writing and delivered by hand or sent by certified mail, postage prepaid and return receipt requested, fax, or by an overnight delivery service to the receiving party at its address set forth above or as otherwise designated by written notice. Notice to Programmer shall be provided as follows:

 

REAL HIP-HOP NETWORK BROADCAST CORPORATION

1455 Pennsylvania Avenue NW Suite 400

Washington, DC 20004

Attention: Atonn  Fatir Muhammad, President and CEO

Phone: (202) 379-3115 ext. 101

  

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Fax: (202) 478-0832

 

Notice to Affiliate shall be provided as follows:

DIRECTV, Inc.

2230 East Imperial Highway

El Segundo, California 90245

Attention: Vice President, Programming

Fax: (310) 535-5416

cc: Executive Vice President and General Counsel

Fax: (310) 964-4991

cc: Senior Vice President, Advertising Sales

Fax: (212) 556-8546

 

Notice given by hand shall be considered to have been given on the date delivered or, if delivery is refused, as of the date presented. Notice given by mail shall be considered to have been given five (5) days after the date of mailing, postage prepaid certified mail (return receipt requested). Notice given by facsimile machine shall be considered to have been given on the date receipt thereof is electronically acknowledged. Notice given by an overnight delivery service shall be considered to have been given on the next business day.

10.           Waiver. The failure of any party to insist upon strict performance of any provision of this Agreement shall not be construed as a waiver of any subsequent breach of the same or similar nature. Subject to Section 8.4 above, all rights and remedies reserved to either party shall be cumulative and shall not be in limitation of any other right or remedy which such party may have at law or in equity.

11.           Binding Agreement; Assignment. This Agreement shall be binding upon the parties hereto and their respective successors and assigns, except that it may not be assigned by transfer, by operation of law or otherwise, without the prior written consent of the non-transferring party, which shall not be unreasonably withheld; provided, however, that Affiliate may assign its rights and obligations under this Agreement (i) to an Affiliated Company or to a successor entity to Affiliate’s business; and/or (ii) to a third party as part of preparing to go or going public or as part of a merger, consolidation or sale of all or substantially all of the assets of the assigning party.

12.           Laws of California. This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts made and to be fully performed therein, except to the extent that the parties’ respective rights and obligations are subject to mandatory local, State and Federal laws or regulations. The parties hereby agree that the jurisdiction of, or the venue of, any action brought by either party shall be in a state or federal district court sitting in the Los Angeles, California and both parties hereby agree to waive any right to contest such jurisdiction and venue.

13.           Entire Agreement and Section Headings. This Agreement, of which the Exhibits attached hereto form an integral part, sets forth the entire agreement and understanding of the parties relating to the subject matter hereof, and supersedes all prior agreements, arrangements, or understandings relating to the subject matter hereof. This Agreement shall not be modified other than in a writing, signed by each of the parties hereto. The section headings hereof are for the convenience

 

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of the parties only and shall not be given any legal effect or otherwise affect the interpretation of this Agreement.

14.           Severability. The parties agree that each provision of this Agreement shall be construed as separable and divisible from every other provision and that the enforceability of any one provision shall not limit the enforceability, in whole or in part, of any other provision hereof. In the event that a court of competent jurisdiction determines that a restriction contained in this Agreement shall be unenforceable because of the extent of time or geography, such restriction shall be deemed amended to conform to such extent of time and/or geography as such court shall deem reasonable.

15.           Confidentiality. The parties agree that they and their employees have maintained and will maintain, in confidence, the terms and provisions of this Agreement, as well as all data, summaries, reports or information of all kinds, whether oral or written, acquired or devised or developed in any manner from the other party’s personnel or files or any proprietary or subscriber information provided by one party to the other party (the “Confidential Information”), and that they have not and will not reveal the same to any persons not employed by the other party except: (A) at the written direction of the other party; (B) to the extent necessary to comply with the law or the order of a court of competent jurisdiction, in which event the disclosing party shall so notify the other party as promptly as practicable (and, if possible, prior to making any disclosure) and shall seek confidential treatment of such information, or in connection with any arbitration proceeding; (C) as part of its normal reporting or review procedure to its parent company, its auditors and its attorneys, and such parent company, auditors and attorneys agree to be bound by the provisions of this Section 15; (D) in order to enforce any of its rights pursuant to this Agreement; (E) to potential investors, insurers, financing entities and, in the case of Affiliate, to any entity engaged in its DTH business; provided, however, that such person described above agrees to be bound by the provisions of this Section 15; or (F) if at the time of disclosure the Confidential Information is in the public domain through no fault of the disclosing party. Promptly after the Execution Date, the parties shall use their best reasonable efforts to agree upon a mutually acceptable press release with respect to the parties’ general business relationship under this Agreement and to jointly issue and release such press release at a date mutually agreed upon. During the Term, neither party shall issue an independent press release with respect to this Agreement or the transactions contemplated hereby without the prior written consent of the other party.

16.           Cessation of Program Distribution. If Affiliate reasonably determines that its provision of any Service programming violates any Law or may infringe upon the rights of any third party, then, following written notice to Programmer, Affiliate may cease distributing such programming to the extent, but only to the extent, necessary and for the time necessary, as reasonably determined by Affiliate, to prevent such violation or infringement from continuing.

17.           Survival of Representations and Warranties. All representations and warranties contained herein or made by the parties, and each of them, in connection herewith shall survive any independent investigation made by either party.

18.           Publicity. Neither Programmer, its Affiliated Companies, nor any of their officers, directors, employees, agents or representatives shall initiate or have any oral or written communication (including, without limitation, announcements, correspondence and advertisements) with or directed to any person or entity (including, without limitation, the press, the public, Affiliate subscribers, the trade and governmental or quasi-governmental agencies, authorities or instrumentalities) (i) which concerns the negotiation (or other transactions in contemplation of),

  

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termination, amendment, modification, renewal, non-renewal or expiration of this Agreement or any other prior, then current or proposed agreement, arrangement; (ii) which includes disparaging statements regarding Affiliate, direct-to-home satellite television service, the direct-to-home satellite industry, or highlights particular programming and/or service available on another multichannel video programming distributor but not available on Affiliate’s DIRECTV Distribution System; or (iii) which would or could reasonably be expected to adversely affect relations between Affiliate and subscribers, potential subscribers or such agencies, authorities or instrumentalities, without the prior written approval of the form and content of such communication by Affiliate; provided, that such approval shall not be required if such communication is required by (x) any applicable Laws or (y) an order of a court, governmental agency, authority or instrumentality of competent jurisdiction; provided, further, that, prior to communication without such approval, Programmer shall have given reasonable prior notice to Affiliate of such intended communication and, if requested by Affiliate, shall have used reasonable efforts at Programmer’s expense to obtain a protective order or similar protection for the benefit of Affiliate. Sub-section (iii) of the preceding sentence shall not apply to (1) any national or local advertising or promotion of the Service or Service programming, provided that such advertising or promotion is not intended to target, adversely affect, disparage, and does not disparage and does not have the effect of disparaging (or is otherwise intended to negatively portray) direct-to-home satellite television service, the direct-to-home satellite industry, or Affiliate, and provided that such advertising or promotion does not highlight that particular programming is available on multichannel video programming distributor but not available on Affiliate; (2) any proceeding before any judicial body, (3) communications with Congress or with any other branch or agency of the Federal Government or (4) any communication by Programmer in direct response to a public communication by Affiliate that could reasonably be expected to cause Programmer harm. This Section 18 shall survive the expiration or termination of this Agreement (regardless of the reason for such expiration or termination) for a period of two (2) years.

19.           Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original and all such counterparts together shall constitute but one and the same instrument. The parties also agree that this Agreement shall be binding upon the faxing by each party of a signed signature page thereof to the other party. If such a faxing occurs, the parties agree that they will each also immediately post, by Federal Express, a fully executed original counterpart of the Agreement to the other party.

[Remainder of Page Intentionally Left Blank]

  

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IN WITNESS WHEREOF, the undersigned parties have caused this Agreement to be executed by their duly authorized representatives as of the day and year first above written.

DIRECTTV, INC.

By:      /s/ Toby Berlin                                                 

         Name: Toby Berlin

Title: Vice President, Vice President, Programming Acquisitions

REAK HIP-HOP NETWORK BROADCAST CORPORATION

By:    /s/ Atonn Muhammad                                                

Name:  Atonn Muhammad

Title:  President/CEO

 

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EXHIBIT A

SERVICE DESCRIPTION

 

 

 

 

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EXHIBIT B

SD DELIVERY SPECIFICATIONS

Technical Requirements for New DIRECTV Standard Definition Continuous Non-Local Services

	
  

	
1.

	
A fully integrated broadcast quality NTSC program feed (in 4:3 aspect ratio) must be delivered to two DIRECTV Broadcast Centers (both to be selected solely by DIRECTV). All feeds must be delivered via satellite or fiber optic transmission. All costs associated with delivery to both Broadcast Centers to be borne solely by Programmer.

	
  

	
2.

	
Should Programmer elect to deliver via satellite, Programmer must use an encrypted C or Ku-band feed delivered via a geostationary satellite typically used for television program delivery and located in the US domestic arc (defined here to be 70 degrees WL to 139 degrees WL).

	
  

	
3.

	
Should Programmer elect fiber optic delivery to either or both DIRECTV Broadcast Centers, Programmer must use dedicated facilities providing continuous 24x7 end-end connectivity. Programmer to be named customer of record with all associated telecom service providers thereby assuming all operational, troubleshooting and preventative maintenance responsibilities associated with supporting the program feed. DIRECTV may, upon 90 days notice, require Programmer (at Programmer’s sole expense) to re-terminate a fiber optic feed to an alternate DIRECTV Broadcast Center or an alternate location within a DIRECTV Broadcast Center.

	
  

	
4.

	
Programmer must supply two sets of such receivers, decoders, codecs, delay units and all other equipment as required to produce both a main and a back-up program feed to both DIRECTV Broadcast Centers (four total). All required equipment must arrive at least one (1) month prior to start of testing. Testing shall commence approximately two (2) weeks prior to the Service Commencement Date.

	
  

	
5.

	
The technical quality of all supplied standard definition NTSC signals shall be of contribution quality. Analog signals shall be compliant with SMPTE 170M and digital signals compliant with SMPTE 259M. The video shall be essentially free of compression artifacts and noise when displayed on a professional monitor. Audio shall be free of noise and distortion in a professional listening environment.

	
  

	
6.

	
Prior to start of testing, Programmer must furnish to DIRECTV complete service specific technical details for the proposed transmission path between Programmer and DIRECTV’s Broadcast Centers. Such information to include all transmission service providers, satellites and coordinates, transponders, encryption methods, fiber circuit numbers, DTMF tone formats, 24x7 telephone contacts and such other information as needed to completely detail the path sufficient to facilitate immediate outage recovery in the event of a loss of continuity.

	
  

	
7.

	
Programmer to support a complete end-to-end thread test between the program origination point and DIRECTV’s Broadcast Centers using the actual transmission path, configuration and equipment to be used in on-going operations. Start of testing

  

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to begin approximately two (2) weeks prior to the start of service. Tests must be encrypted. Programmer to schedule and fully support such additional tests and all other work as required to ensure a successful DIRECTV start of service.

	
  

	
8.

	
In the event that Programmer delivers the feed of the Service in digital format during the Term, DIRECTV shall determine, in its sole discretion, the manner in which the digital feed is passed through to DIRECTV Subscribers (including, without limitation, via an analog to digital conversion). In addition, the video and audio signal quality shall be subject to the reasonable approval of DIRECTV Engineering. Quality must be comparable to other services delivered to DIRECTV and must be consistently maintained during testing and throughout the Term.

	
  

	
9.

	
Closed Captioning Specifications. Programmer shall deliver the closed captioning signal such that it is compliant with CEA-608-C. If delivery is via analog NTSC video, the signal must be compliant with CEA-608-C (carriage in NTSC video Line 21 Field 1/2). If delivery is via SDI video, the signal must be compliant with SMPTE 334M-2000 (carriage in SDI VANC). To the extent that Programmer delivers the signal in high definition format, Programmer shall deliver the closed captioning signal for the high definition feed such that it is compliant with CEA-708-B. If delivery of the high definition signal is via transport stream (terrestrial broadcast, etc) the signal must be compliant with ATSC A/53E (carriage in MPEG2 video user data). If delivery is via HD-SDI (provider specified decoder, etc) the signal must be compliant with SMPTE 334M-2000 (carriage in HD-SDI VANC).

NOTE: In the event of a conflict between the requirements set forth in this Exhibit “B” and those elsewhere in the Agreement, the requirements of this Exhibit “B” shall control with respect to SD delivery.

  

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·

	
Each term shall mean each consecutive twelve month period following the Service Commencement Date or the previous Term Year, as applicable.

 

 

 

 

 

 

 

 

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