Exhibit 10.7
AMENDED AND RESTATED PROGRAM LICENSE AGREEMENT
This AMENDED AND RESTATED PROGRAM LICENSE AGREEMENT is
entered into as of October 1, 1996 by and between UNIVISA, INC., a Delaware
corporation, (hereinafter "Licensor") and THE UNIVISION NETWORK LIMITED
PARTNERSHIP, a Delaware limited partnership ("Licensee"), and amends and
restates that certain PROGRAM LICENSE AGREEMENT made as of the 17th day of
December, 1992 by and between Licensor and Licensee.
WHEREAS, Licensor has or will have rights in the United
States of America, including all territories and possessions thereof other
than Puerto Rico (the "Territory"), to license certain television programs in
the Spanish language or with Spanish subtitles produced by and to be produced
by Televisa, S.A. and other entities controlled by Grupo Televisa, S.A.
("GT") (GT and all of the companies it controls, including Televisa, S.A.,
and Licensor being hereinafter referred to collectively as "Televisa").
WHEREAS, Licensee operates the Univision Spanish language
television network and the Galavision Spanish language television network of
affiliated television broadcast stations and cable television systems (such
networks being hereinafter referred to as the "Networks" and those television
broadcast stations affiliated with such Networks that are now or hereafter
directly or indirectly majority owned and operated by Univision
Communications Inc. ("UCI") or a direct or indirect subsidiary of UCI or with
respect to which UCI or a direct or indirect subsidiary of UCI has the right
to designate a majority of the board or similar governing body, and in each
case, which broadcast in the Spanish language format being hereinafter
referred to as the "Stations") and desires to acquire the right to broadcast
certain of the programs produced, to be produced or otherwise marketed by
Televisa over the Networks in the Territory and Licensor is willing to grant
such a license upon the terms, provisions and conditions herein set forth.
WHEREAS, Dennevar B.V. ("Venevision") is simultaneously
herewith entering into an Amended and Restated Program License Agreement,
dated as of the date hereof (the "Venevision Agreement"), with the Licensee
to license certain television programming for broadcast over the Networks.
NOW, THEREFORE, in consideration of the mutual promises and
covenants herein contained, the parties hereto agree as follows:
1. RIGHT OF FIRST OFFER OF PROGRAMMING.
1.1 Pursuant to the terms and conditions hereof,
Licensor hereby grants Licensee the option to obtain an exclusive license for
the broadcast over the Networks in the Territory of all Programs (as hereinafter
defined). The option may be exercised as follows:
(a) First, Licensee will have a first option to
accept for exclusive license in the Territory, subject to all the other terms
and conditions of this Agreement: (i) Programs in an amount that, when
aggregated with Programs accepted pursuant to Section 1.1(a) of the Venevision
Agreement, will be sufficient to fill 18 hours of programming per day in
aggregate for the two Networks combined, and (ii) any news Programs.
(b) Second, Licensor may make available for license
to the owners and operators of KWHY-TV, Channel 22 ("KWHY") all Programs (other
than news Programs) not accepted by Licensee pursuant to paragraph (a) above for
exclusive use in the Los Angeles ADI; PROVIDED, HOWEVER, that during the
Broadcast Period (as defined below) of any Program licensed by Licensee,
Licensor shall not license KWHY to broadcast reruns of such Program or Programs
of the same series as such Program. KWHY will be entitled to accept an amount
of programs that will be sufficient to fill up to one 85 hour-per-week time
schedule. The terms of the license to KWHY will provide for payment by KWHY of
a license royalty at a price to be negotiated between Licensor and KWHY. The
license will be assignable by Licensee with a transfer of control of KWHY. The
term of Licensor's obligation to offer Programs to KWHY on the terms described
herein shall not exceed five years from December 17, 1992.
(c) After selection by KWHY of Programs pursuant to
paragraph (b) above, Licensee will have a first option, subject to all the other
terms and conditions of this Agreement, including the 70% coverage requirement
set forth in Section 2 below (determined as provided therein), to accept for
exclusive license in the Territory, any Programs (i) for markets outside of
KWHY's Los Angeles ADI, Programs accepted by KWHY pursuant to paragraph
(b) above and (ii) when paragraph (b) above is no longer applicable, any
Programs for all markets, including Los Angeles, in an amount which, when
aggregated with the amount of Programs accepted pursuant to paragraph (a) above,
will be sufficient to satisfy the representation and warranty included in
Section 7.3 hereof.
1.2 For purposes of this Agreement only:
(a) "Programs" means (i) programs initially produced
in the Spanish language or programs with Spanish subtitles produced by third
parties or co-produced by Televisa with third parties to which Televisa owns
sole television broadcast rights in the Territory (and which is not a
Co-Produced Program (as defined below)); (ii) all programs initially produced in
the Spanish language or programs with Spanish subtitles, previously produced
directly or indirectly by or for Televisa and to be produced directly or
indirectly by or for Televisa for broadcast at any time to which Televisa owns
television broadcast rights in the Territory and which are available for
broadcast including, without limitation, in the following categories: novelas,
musicals, variety shows, situation comedies, game shows, talk shows, children's
shows, news shows, cultural and educational programs, and sports programs; and
(iii) movies produced by Televisa and for which Televisa owns the
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television broadcast rights in the Territory, from and after the time that such
movies become available for free television broadcast in the Territory. Each
Program shall be available for license to Licensee in the Territory pursuant to
the terms of this Agreement upon the first to occur of (i) the date when such
Program is initially broadcast by Televisa or (ii) the date when such Program is
first made available for broadcast by any third party. Except as provided in
the following paragraph, if Licensor or Televisa shall produce directly or
indirectly any Spanish Language or Spanish subtitled programming for broadcast
in the Territory it shall be deemed a Program subject to the terms and
conditions of this Agreement.
The term "Programs" does not include Special Programs (other
than Televisa Produced U.S. Special Programs, as defined below), Co-Produced
Programs or Default Programs (each as defined below) or local news or public
affairs programs (it being understood that all such local programs will be
produced or acquired by Licensee or its affiliated stations). "Co-Produced
Programs" means programs originally produced for broadcast in the Spanish
language or with Spanish subtitles, previously produced, or to be produced,
by Televisa for broadcast pursuant to co-production agreements with
unaffiliated third parties or produced by unaffiliated third parties (in each
case, other than any broadcaster in and to the Territory) (i) under which
Televisa does not own the right to permit the broadcast of such program in
the Territory and/or (ii) under which Televisa is required to share with such
third parties the revenue derived from the broadcast of such program in the
Territory. No program that would otherwise be a Program under Section
1.2(a)(ii) shall become a Co-Produced Program solely because Televisa or
Licensor licenses or sells distribution rights in the Territory prior to or
during production of such program and neither Televisa nor Licensor shall
enter into any agreement to the contrary. In order for a program to be a
Co-Produced Program, some material underlying property right of such program
must be provided by such unaffiliated third party and such unaffiliated third
party must participate in the development and production of the Program in
exchange for such third party's distribution rights in the Territory or
participation in distribution revenues from the Territory. Nothing contained
in this Agreement shall prevent Licensor or Televisa from licensing broadcast
rights (in exchange for cash or in-kind services or property other than
Programs) for territories other than the Territory to programs initially
produced in the Spanish language or programs with Spanish language subtitles
that are developed and produced in the Territory by unaffiliated third party
producers located in the Territory, including broadcasters, provided that
neither Licensor nor Televisa has participated in any way in the development
or production of any such program. Televisa agrees that it will use its good
faith efforts not to structure agreements with respect to programs in a
manner intended to cause such programs not to be considered Programs
hereunder.
(b) "broadcast" or "network broadcast" means all
electronic forms or other means now known or hereafter developed of transmission
and re-transmission, including but not limited to over-the-air television, cable
television, low
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power television, multi-point distribution systems, wire, fiber optics,
microwave, and satellite, except for purposes of delivery of the Programs
pursuant to Section 4.
(c) "Affiliate" of a person means any person that
directly or indirectly controls, is controlled by, or is under common control
with the person in question. For the purposes of this definition, "control",
when used with respect to any person, means the power to direct the management
and policies of such person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise. Affiliate shall not
mean any television station that has entered into an affiliation agreement with
the Networks but is otherwise not an Affiliate of UCI, any Person that controls
Grupo Televisa S.A. or any person under common control with, but not directly
or indirectly controlled by, Grupo Televisa S.A.
1.3 Licensor and its Affiliates shall have the right and
ability to, and to permit others to: (i) transmit or re-transmit in any
electronic form or other means, from any television station in Mexico, or via
satellite which receives its signal from any earth station or other facility in
Mexico, any Programs which may also be covered by this Agreement,
notwithstanding the fact that such transmissions or re-transmissions may be
viewed in the Territory, provided that neither Licensor nor its Affiliates
consent to the retransmission of such Programs by any television station in the
Territory or by any cable system in the Territory that is located beyond 35
miles from the community of license of any transmitting television station in
Mexico transmitting the Programs (any such cable re-transmission within such 35
mile limit being hereby expressly permitted); and (ii) market and promote and
otherwise generate revenues (including, but not limited to, the sale of
advertising time) attributable to the ability of viewers in the Territory to
receive such Programs.
2. NOTIFICATION, ACCEPTANCE AND LICENSING OF PROGRAMMING. Not
less than once in each calendar quarter during the term of this Agreement,
Licensor will deliver a written notice (an "Availability Notice") to Licensee
specifying all Programs which (a) have become available for license by Licensee
since the delivery of the preceding Availability Notice or (b) may no longer be
available to Licensee on an exclusive basis. Such notice shall be accompanied,
if practicable, by a video tape pilot or representative episode of each of the
new Programs (except for live Programs). If Licensee desires to license any
Programs, it must notify Licensor of its acceptance in writing (an "Acceptance")
within thirty days of receipt of the Availability Notice. Such Acceptance shall
specify the name of the Accepted Program, the name of the Network on which it is
to be broadcast, the date and time period in which Licensee intends to commence
the broadcast of the Accepted Program (which date shall be not more than 180
days from the date of Acceptance with respect to Programs other than novelas and
shall be not more than 270 days from the date of Acceptance with respect to
novelas), and such other information as may reasonably be requested by Licensor.
An Acceptance shall constitute the exercise by Licensee of its option for the
Program(s) accepted and upon receipt by Licensor of such Acceptance, the
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Program(s) covered by each such Acceptance shall without further action be
automatically licensed to Licensee on the terms and conditions of this
Agreement. Subject to the terms and conditions set forth herein, Licensee shall
have exclusivity in the carriage of all accepted Programs ("Accepted Programs")
for broadcast in the Territory from the date of acceptance to the conclusion of
the applicable Broadcast Period. If no such Acceptance is received with respect
to any or all available Programs, Licensor shall be free to license all such
unaccepted Programs ("Unaccepted Programs") to others in the Territory for not
more than one run over a period of one year (which license, in the case of
novelas, may also provide for one rerun), subject to Licensee's right of first
refusal described in Section 3; provided, however, that during the Broadcast
Period of a Program licensed by Licensee, Licensor shall not license any other
person or entity to broadcast in the Territory reruns of such Program or other
Programs of the same series as such Program.
In order to avoid the "warehousing" of Programs by the
Licensee, (A) Licensee shall not issue Acceptance Notices without specifying
the intended broadcast commencement date and time period; however, Licensee
shall have the right at any time for any bona fide reason, on not less than
10 days' written notice to Licensor at least 60 days prior to the intended
broadcast date, (i) to switch dates and times among previously Accepted
Programs or among previously Accepted Programs and programs acquired from
another source, provided that after giving effect to such switch all other
requirements with respect to broadcast and scheduling of Programs contained
in this Agreement continue to be satisfied and/or (ii) to rescind Acceptance
with respect to any Program and to issue an Acceptance Notice with respect to
a substitute Program, provided that (x) the substitute Program shall be
broadcast in the time slot originally reserved for the rescinded Program and
(y) the rescinded Program shall thereafter constitute a Default Program, (B)
Licensee shall not issue Acceptance Notices with respect to more Programs
than it is capable of airing over the Networks, and (C) Licensee shall not
broadcast any First-Run Program (other than news) on either of the Networks
(X) between the hours of 1:00 a.m. and 9:00 a.m. unless Licensee can
demonstrate that it is commercially reasonable to broadcast such program
during such period, or (Y) during any other time period during which Licensee
cannot reasonably expect the 70% broadcast coverage requirement described in
the following paragraph to be satisfied.
Subject to the preceding paragraph, with respect to any
Accepted Program, Licensee must commence the broadcast of the Program on one
of the Networks over at least 70% of such Network's coverage (as determined
by the number of Hispanic television households potentially reached by the
applicable Network) within 180 days following notice of its Acceptance
(except for novelas where the time for commencement may be extended for an
additional 90 days because of scheduling problems) and shall continue to
broadcast the Program without substantial interruption over such minimum of
70% Network coverage until the conclusion of the Broadcast Period (as defined
below). Should Licensee fail to comply with the broadcast commencement, 70%
coverage and continuous broadcast provisions of this paragraph, Licensee's
license with respect to the Program (a "Default
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Program") shall be terminated 10 days following written notice of
non-compliance unless Licensee demonstrates compliance or excusable
non-compliance with such provisions. In the event of termination, the
Default Program shall be subject to re-license by Licensor to others at any
time or from time to time (without any right of first refusal or other right
applicable to Licensee, whether pursuant to Section 3 or otherwise). The
parties acknowledge that this provision is designed to avoid "warehousing" of
product by Licensee and that in the event Licensee breaches the provisions of
this paragraph, Licensor's damages are incapable of calculation and the
remedies set forth herein are appropriate under the circumstances.
For purposes of this Agreement only:
(a) "Broadcast Period" means (i) for novelas or other Programs
with a plot line continuing through more than one episode, the time necessary
to broadcast all episodes on a continuing basis without substantial
interruption and (ii) for all other programs (excluding one-program shows),
(x) for weekly programs, the time period necessary to broadcast 26 episodes
of the Program without substantial interruption, which under normal
circumstances is expected to be 26 continuous weeks and (y) for daily
programs (Monday through Friday), 26 weeks.
(b) "without substantial interruption" means that the Programs
will be scheduled and run on a continuing periodic basis except for
occasional network preemption to accommodate one-time specials or programs
which, because of their nature or timeliness or because of FCC Rules, must in
Licensee's reasonable judgment be broadcast in lieu of the regularly
scheduled Program.
3. RIGHT OF FIRST REFUSAL. If any other person or entity (other
than KWHY, or its assignees, with respect to Programs licensed by it pursuant
to Section 1.1(b) hereof) wishes to accept for broadcast in the Territory any
Unaccepted Programs which Licensor has offered to it pursuant to Section 2,
Licensor shall send a written notice (a "Second Chance Notice") to Licensee
specifying the name of any such Programs and the license terms offered by
such person or entity that wishes to accept such Unaccepted Programs.
Licensee shall have a right of first refusal, good for three business days
from receipt of the Second Chance Notice to acquire such Unaccepted Program,
subject to the same conditions offered by such other person or entity, for
the Program Royalty (as defined in Section 5) plus the amount, if any, by
which the license fee offered by such other person or entity exceeds the
Program Royalty attributable to combined net time sales for the time slot in
which such Program is broadcast. Any such Unaccepted Programs which are not
accepted in writing by Licensee within three business days of receiving a
Second Chance Notice may be licensed to such other person or entity. Rights
to exploit Unaccepted Programs will be granted to other persons or entities
for not more than one run over a period of one year (provided that, in the
case of novelas, such rights may include the right to one rerun), and if the
same Program is offered thereafter in the Territory, it will once
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again be offered to Licensee pursuant to Section I hereof. All episodes of a
novela which are to be shown within one year from the showing of the first
episode shall be deemed to be the same Program for the purposes of the
requirement to offer all programming first to Licensee.
4. DELIVERY, EXPENSES AND USE OF PROGRAMS.
4.1 Following Licensee's acceptance of Programs pursuant to
Sections 2 or 3 of this Agreement, Licensor shall deliver to Licensee, at
Licensee's expense, and in accordance with Licensee's reasonable and
customary instructions, a visual and aural reproduction of each such Program
or Program episode via satellite or video tape suitable for broadcast and
formatted for U.S. broadcast in accordance with past practices, at least ten
days prior to Licensee's scheduled broadcast, except for live broadcasts or
as otherwise agreed by the parties. Programs will be deemed delivered by
Licensor when transmitted to the satellite, when actually received if shipped
by freight, or when made available through permission to re-transmit the
signal of an affiliate of Licensee.
4.2 Licensee agrees that as soon as practicable following
receipt of each satellite transmission or video tape delivery, it will
examine it to determine whether it is physically suitable for broadcasting
and notify Licensor immediately upon detecting any defect rendering such copy
unsuitable for telecast. In such cases, Licensor shall promptly deliver at
its own expense either a physically suitable tape or (except in the case of
novelas) a tape of another Program in the same series, subject to
verification of the defect.
4.3 Licensee agrees to return each video tape delivered by
Licensor to Licensor on the reels and in the containers in which it was
shipped, in the same condition as received, reasonable wear and tear through
proper use excepted, as soon as practicable after telecast. Licensee shall
pay all costs of returning the tapes to Licensor. Should Licensor request
that the video tape be sent to a location other than Licensor's warehouse,
Licensor will bear responsibility for shipping costs above those which would
have been applicable for shipping the video tape to Licensor's warehouse.
4.4 The video tapes shall at all times remain the property of
Licensor subject to Licensee's rights as herein provided. The risk of loss,
damage, destruction or disappearance of any tape shall be borne by Licensee
from the time of delivery to Licensee until the return thereof to Licensor or
Licensor's designee and as to any tape or part thereof lost, stolen,
destroyed or damaged after delivery to Licensee and before the return
thereof, Licensee shall pay Licensor the cost of replacement thereof, which
payment shall be limited to the cost of replacing the raw video tape.
4.5 Licensee will not, and will not authorize others to copy,
duplicate or re-license any Program unless necessary for Licensee's own
network broadcast. Any
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duplicate or copy of any part of the Program (including trailers) made by
Licensee for its own purposes will be erased following the broadcast of the
Program. Upon receipt of written request from Licensor, an officer of
Licensee shall certify in writing the destruction of all such copies.
4.6 Licensor will furnish to Licensee glossy prints of still
photos, synopses, casts and all other promotional material for the promotion
and exploitation of the Programs, if available. Licensor grants to Licensee
the right to use and license others to use Licensor's name and, unless
Licensee is advised by Licensor that the rights of Licensor are limited (in
which case, to the extent not limited), to use and license others to use the
name and likeness of, and biographical material concerning, each star,
featured performer, writer, director and producer in the Programs and the
titles of each program and fictitious persons and locales therein, for
advertising and publicity, of the Programs, and any broadcaster or sponsor
thereof, but not for direct endorsement of any product or service, provided
that any such use will protect the copyrights of Licensor. To the extent
available to Licensor after reasonable efforts, Licensor will furnish
Licensee with music cue sheets for the Programs and the information necessary
for administration of rights payments and compliance with Section 507 of the
Federal Communications Act of 1934, as amended concerning broadcast matter
and disclosures required thereunder, insofar as that Section applies to
persons furnishing program material for television broadcasting ("Section
507"). Subject to the foregoing and subject to Licensor's reasonable prior
approval, Licensee shall have the right to produce its own promotional
material for or from the Programs.
4.7 Licensee agrees to include in its broadcast of Accepted
Programs all copyright notices and all credits made part of each Accepted
Program including but not limited to stars, directors, producers and writers.
Licensee shall exhibit the Accepted Program as delivered in the Spanish
language or with Spanish subtitles and no change, alteration or addition may
be made to any Program without Licensor's consent except as may be necessary
for the insertion of commercials during natural breaks in the Program or
except as may be necessary to comply with Licensee's broadcast standards and
practices and applicable government rules and regulations.
4.8 Subject to Section 7.1 and 7.3 and Licensee's remedies
for a breach thereof, Licensor may, at its sole and absolute discretion,
withdraw any Program and terminate any license with respect to such Program
if Licensor reasonably determines that the broadcast thereof is likely to:
(i) infringe the rights of third parties, (ii) violate any law, court order,
governmental regulation or ruling of any governmental agency, (iii) otherwise
subject the Licensor to any material liability. In addition Licensor reserves
the right to withdraw any Program prior to the conclusion of the applicable
Broadcast Period if, for any reason, the program is no longer being produced
by or available to Televisa. In the event of any such withdrawal or
termination, Licensor shall give Licensee as much notice as possible, and the
parties shall have no obligations to each other with regard to Programs not
produced, subject to Section 7.1 and 7.3 and Licensee's remedies for a breach
thereof. No
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Program that is withdrawn pursuant to this Section 4.8 shall be relicensed to
a third party in the Territory without being first offered to Licensee
pursuant to Section 1.
4.9 The license granted to Licensee with respect to each
Accepted Program (other than novelas) shall be for one Network broadcast of
each Program or Program episode, subject only to FCC rules and regulations
and to tape delay in certain of Licensee's affiliated outlets to accommodate
time zone differences. In addition, within 24 hours of the original
broadcast, Licensee may broadcast a repeat of any Program, free of the
restrictions contained herein regarding Network coverage. Except as herein
provided, without the express permission of Licensor, not to be unreasonably
withheld, no Program or Program episode may be rerun during any Broadcast
Period.
Notwithstanding the prohibition on reruns during a Broadcast
Period, Licensee will have the option at the end of any Broadcast Period to
license one (1) rerun of each novela (herein "Protected Rerun"). Such option
must be exercised in writing not later than thirty (30) days before the end
of the Broadcast Period for each such novela. The terms of such Protected
Rerun license shall be the same as for the original license, except that the
time during which the broadcast must commence will be one (1) year instead of
one hundred and eighty (180) days.
5. ROYALTIES.
5.1 Except as set forth in Section 5.2 below, Licensee shall
pay Licensor a royalty (the "Program Royalty") in cash for the Programs
offered to it in an aggrgate amount equal to 5.5% of combined net time sales
(as defined below) for the period commencing on the date hereof and ending on
December 31, 1996, 6.75% of combined net time sales for the period commencing
on January 1, 1997 and ending on December 31, 1997, and 7.5% of combined net
time sales for all periods commencing on or after January 1, 1998 until the
termination of this Agreement. For purposes of this Agreement, "combined net
time sales" shall mean all time sales of the Stations and the Networks,
including barter and trade and television subscription revenue (including,
without limitation, satellite subscription revenue), less advertising
commissions, Special Event Revenue (as defined below), music license fees,
outside affiliate compensation, and taxes (other than withholding taxes) paid
by Licensee pursuant to Section 5.5 hereof and similar taxes paid by the
Stations calculated in accordance with U.S. generally accepted accounting
principles ("GAAP"). Notwithstanding the foregoing, no revenues of the
Galavision Network received prior to the closing of the acquisition of the
assets of the Galavision Network by Licensee pursuant to the Galavision
Network Option Agreement between Univisa and Licensee entered into as of
December 17, 1992 shall be included in combined net times sales for purposes
of computing the Program Royalty. Unless otherwise agreed in writing between
the parties, barter and trade sales shall be valued at the fair market value
of the goods or services received by the Licensee or the Stations.
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5.2 Notwithstanding Section 5.1 above, to the extent from
time to time specified in a writing signed by both Licensor and Venevision
and delivered to Licensee, the amounts of the Program Royalties payable in
accordance with Sections 5.1 of this Agreement and the Venevision Agreement
may be changed by Licensor and Venevision, so long as the aggregate of the
amounts of such Program Royalties under this Agreement and the Venevision
Agreement does not exceed for any period twice the applicable amount computed
in accordance with Section 5.1 of this Agreement. Licensor and Venevision
shall not deliver such a writing more than twice a year.
5.3 Program Royalties shall be paid currently on a monthly
basis on the twelfth business day after the end of each month in a single
payment to Licensor based upon the parties' good faith best estimate at such
time of the amounts accrued. Appropriate adjustment (the "Adjustment") will
be made to Program Royalties on a quarterly basis within 45 days after the
end of each quarter, and the full amount thereof shall be paid or credited,
as the case may be, with the next monthly payment of Program Royalties for
any difference between the amounts so paid and those finally determined to
have accrued. In all cases, the calculation of the Adjustment will be made
as promptly as practicable by Licensee, and in the event of any disputes the
determination shall be made by a nationally recognized independent certified
public accounting firm mutually selected by Licensor and Licensee (or, if
they fail to designate such a firm within 10 days after written notice of a
dispute, by such firm designated by the President of the American Arbitration
Association (or his designee)), whose determination will be final and binding
upon the parties. The fees and expenses of such firm shall be paid one-half
by Licensor and one-half by Licensee, unless such firm determines it would be
more equitable to otherwise allocate such fees and expenses.
5.4 All payments made pursuant to this section shall be in
cash in U.S. currency with accompanying back-up information in reasonable
detail of combined net time sales for the applicable period. Such payments
shall be calculated as provided above regardless of the amount of Programs
licensed hereunder or whether any such Programs are broadcast. In order to
assure compliance with the terms of this Agreement, Licensor shall have the
right to receive once each year a certificate from Licensee's independent
certified public accounting firm, which certificate shall attest to the
combined net time sales for the year. Licensee shall pay for the preparation
of such certificate and its delivery to Licensor. Licensor may request
additional certificates and services either from Licensee's accounting firm
or from a firm of certified public accountants chosen by Licensor. The fees
and expenses of the certified public accountants providing such additional
certificates and performing such additional services pursuant to this Section
5.4 shall be paid by Licensor, unless such verification results in an
adjustment in Licensor's favor equal or greater than 5% of the amount
originally computed by Licensee, in which case such fee will be paid by
Licensee. Licensee agrees to provide any certified public accountants
designated by Licensor with access to all business records of Licensor
related to the computation of combined net time sales. Licensor agrees to
maintain the confidentiality of all information learned from Licensee in
connection with the performance of this Agreement, other than
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information (i) which becomes public (unless it becomes public because of a
breach of this covenant by Licensor), (ii) which otherwise becomes known to
Licensor (unless Licensor knows that the information has been disclosed in
violation of a confidentiality agreement with Licensee), or (iii) which
Licensor is required by law, order or administrative law request or by stock
exchange rule or regulation to divulge.
5.5 Any and all sums payable on account of sales, use or other
similar taxes arising out of or relating to the licensing or exhibition by
Licensee of the Programs, in addition to any personal property or other tax
assessed or levied by any governmental unit arising out of or relating to the
storage or possession of the Programs thereof by Licensee shall be paid by
Licensee.
5.6 Licensee may deduct and withhold from any payment to or for the
account of Licensor with respect to the Program Royalties such amounts as it
in good faith determines it is required to withhold with respect to such
payment under applicable United States and state tax withholding laws, and
shall promptly remit such amounts to the appropriate taxing authority.
Within 30 days of any such remittance Licensee shall furnish to Licensor the
original or certified copy of a receipt evidencing payment, or other evidence
of payment reasonably satisfactory to Licensor. If Licensor has timely filed
with Licensee a duly completed Form 4224, 1001, W-8 or W-9, of the Internal
Revenue Service (or successor form thereto) or has complied with applicable
procedures under state law, entitling it to exemption from, or a reduced rate
of, withholding under the applicable law or regulations, the amount withheld
shall be accordingly limited. Licensee shall cooperate in any reasonable
manner requested by Licensor to minimize Licensor's withholding tax liability.
5.7 If Licensee is more than 30 days late in paying any amount due to
Licensor under this Section 5, such late amounts shall thereafter bear
interest at a rate equal to LIBOR plus 5%, plus any applicable withholding.
6. SPECIAL PROGRAMS AND CO-PRODUCED PROGRAMS.
6.1 For purposes of this Agreement:
(a) "Special Programs" means special programs such as the World
Cup, other sporting events, political conventions, election coverage,
parades, pageants, special variety shows and other non-episodic and
non-continuing shows.
(b) "Non-Televisa-Produced Special Programs" means Special
Programs not produced directly or indirectly by or for Televisa.
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(c) "Televisa-Produced U.S. Special Programs" means
Televisa-Produced Special Programs for which Licensor has adequate rights to
license such Special Programs to Licensee under the terms of this Agreement.
(d) "Televisa-Produced Non-U.S. Special Programs" means
Televisa-Produced Special Programs for which Licensor does not have adequate
rights to license such Special Programs to Licensee under the terms of this
Agreement.
(e) "Televisa-Produced Special Programs" means Special Programs
directly or indirectly produced by or for Televisa.
(f) "Special Event Revenue" means net time sales for
Non-Televisa-Produced Special Programs and Non-Venevision-Produced Special
Programs as defined in the Venevision Agreement broadcast by Licensee on
either Network.
6.2 Licensor shall use its best efforts, and shall cause its
Affiliates to use their best efforts, to coordinate its Non-Televisa-Produced
Special Program acquisitions with those of Licensee, so as to permit Licensee
to participate therein and to acquire rights in the Territory to such
programs on an advantageous basis and on terms satisfactory to Licensee;
PROVIDED, HOWEVER, that the obligation to use "best efforts" shall not be
interpreted to include any obligation of Licensor or its Affiliates to expend
additional money to permit Licensee's participation or to acquire rights on
an advantageous basis.
6.3 Televisa-Produced U.S. Special Programs shall be "Programs" for
all purposes of this Agreement.
6.4 At the request of Licensee, Licensor shall use its best
efforts, and shall cause its Affiliates to use their best efforts, to acquire
broadcast rights in the Territory on terms satisfactory to Licensee for
Televisa-Produced Non-U.S. Special Programs and any Co-Produced Program that
falls within clause (i) (but not clause (ii)) of the definition of
"Co-Produced Program" in Section 1.2(a); provided, however, that the
obligation to use its "best efforts" shall not be interpreted to include any
obligation of Licensor to expend additional money, except to the extent
reimbursed by the "Special Event Fee" (as defined below). Such programs
accepted by Licensee shall be licensed hereunder to Licensee for the Program
Royalty plus a fee (the "Special Event Fee") in the amount of the cost to
Licensor of the acquisition of broadcast rights in the Territory to such
program, such costs to be determined by the parties in good faith based on
the portion of the total amount paid by Licensor for broadcast rights that is
reasonably allocated to the acquisition of broadcast rights in the Territory.
6.5 Licensor shall offer Licensee in accordance with all applicable
provisions of this Agreement all Co-Produced Programs that fall within clause
(ii) of the definition of "Co-Produced Program" in Section 1.2(a) for which
program Licensor has or
12
can obtain adequate rights and licensing authority to offer such programs to
Licensee in compliance with the terms and conditions of this Agreement,
except that the Program Royalty specified in Section 5 hereof shall not
include the license fee for Co-Produced Programs. Compensation to Licensor
for all Co-Produced Programs accepted by Licensee shall be computed and paid
in accordance with such terms as the parties may mutually agree in writing.
If the parties are unable to agree on the royalty for any Co-Produced Program
within 10 days after such program is offered by Licensor, such program may be
sold to others in the Territory, so long as Licensor in good faith determines
that the terms and conditions applicable to such sale are more favorable to
the Licensor than those offered by the Licensee in writing within such 10-day
period.
7. REPRESENTATIONS AND WARRANTIES OF LICENSOR.
7.1 Licensor hereby agrees, warrants and represents as follows:
(a) Subject to Section 1.4 hereof Licensor is free to enter
into and fully perform this Agreement;
(b) Licensor has or will have the right to grant to Licensee
the broadcast rights to the Accepted Programs in the Territory set forth in
this Agreement, including but not limited to the necessary literary,
artistic, technological and intellectual property rights and has secured or
will secure all necessary written consents, permissions and approvals for
incorporation into such Programs of the names, trademarks, likenesses and/or
biographies of all persons, firms, products, companies and organizations
depicted or displayed in such Programs, and any preexisting film or video
footage produced by third parties;
(c) There are no and will not be any pending claims, liens,
charges, restrictions or encumbrances on the Accepted Programs that conflict
with the broadcast rights granted hereunder to such Programs in the Territory;
(d) Licensor has paid or will pay all compensation, residuals,
reuse fees, synchronization royalties, and other payments which must be made
in connection with the Accepted Programs and in connection with exploitation
of the rights herein granted to Licensee to any third parties including, but
not limited to, musicians, directors, writers, producers, announcers,
publishers, composers, on-camera and off-camera performers and other persons
who participated in production of such Programs, and to any applicable
unions, guilds or other labor organizations; PROVIDED, HOWEVER, that Licensor
has not acquired performing rights for performance in the Territory of the
music contained in such Programs, which rights shall be obtained by Licensee;
PROVIDED, FURTHER, however, that Licensor warrants and represents that all
music is available for licensing through ASCAP, BMI or SESAC (or any
successor or similar entity in the United States) or is in the public domain
or is owned or controlled by Licensor to the extent necessary to permit
broadcasts
13
hereunder in the Territory and no additional clearance or payment
is required for such broadcast;
(e) The main and end titles of the Accepted Programs and all
publicity, promotion, advertising and packaging information and materials
supplied by Licensor will contain all necessary and proper credits for the
actors, directors, writers and all other persons appearing in or connected
with the production of such Programs who are entitled to receive credit and
comply with all applicable contractual, guild, union and statutory
requirements and agreements;
(f) Exercise of the broadcast rights to the Accepted
Programs in the Territory will not infringe on any rights of any third party,
including but not limited to copyright, patent, trademark, unfair
competition, contract, property, defamation, privacy, publicity or "moral
rights" (to the extent such moral rights are recognized by U.S. law);
(g) Except to the extent expressly permitted by this
Agreement, Licensor has not and will not grant or license to others, and will
not itself exercise, any rights to broadcast the Accepted Programs in or to
the Territory;
(h) Each and every one of the representations and warranties
made by Licensor herein shall survive the Broadcast Period for each Accepted
Program;
(i) To the extent Section 507 (as defined in Section 4.6
above) is applicable, no Accepted Program includes or will include any matter
for which any money, service or other valuable consideration is directly or
indirectly paid or promised to Licensor by a third party, or accepted from or
charged to a third party by Licensor, unless such is disclosed in accordance
with Section 507. Licensor shall exercise reasonable diligence to inform its
employees, and other persons with whom it deals directly in connection with
such programs, of the requirements of Section 507; provided, however, that no
act of any such employee or of any independent contractor connected with any
of the programs, in contravention of the provisions of Section 507, shall
constitute a breach of the provisions of this paragraph unless Licensor has
actual notice thereof and fails promptly to disclose such act to Licensee.
As used in this paragraph, the term "service or other valuable consideration"
shall not include any service or property furnished without charge or at a
nominal charge for use in, or in connection with, any of the programs "unless
it is so furnished in consideration for an identification in a broadcast of
any person, product, service, trademark or brand name beyond an
identification which is reasonably related to the use of such service or
property on the broadcast," as such terms are used in Section 507. No
inadvertent failure by Licensor to comply with this paragraph shall be deemed
a breach of this Agreement; and
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(j) For purposes of this Section 7.1 only, "Accepted
Programs" shall be deemed to include Televisa Produced U.S. Special Programs
to the extent broadcast by Licensee.
7.2 Licensor further agrees that, while it has no obligation to do
so, if it secures a producer's (Errors and Omissions) liability policy
covering the Programs, or any part thereof, it will cause Licensee to be
named as an additional insured on such policy and will cause a certificate of
insurance to be promptly furnished to Licensee, provided, however, that the
inclusion of Licensee as an additional insured does not result in any
additional cost or expense to Licensor. Licensor will notify Licensee when
such insurance is obtained and, after obtained if cancelled. Any such
insurance as to which Licensee is an additional insured shall be primary as
to Licensee and not in excess of or contributory to any other insurance
provided for the benefit of or by Licensee.
7.3 Licensor warrants that the amount of Programs made available
throughout the term hereunder for license hereunder, when aggregated with
(i) the amount of Programs (as defined in the Venevision Agreement) made
available for license by Venevision pursuant to the Venevision Agreement,
(ii) any local-produced programming by the Stations to the extent such
locally produced programming is used on either of the Networks, (iii) any
programs produced by Licensee, and (iv) any programs purchased by Licensee
other than from Licensor, will be sufficient to fill a twenty-four hour a
day, seven day a week time schedule for each of the Univision Network and the
Galavision Network, which such time schedules as between the two networks
shall be separate and non-duplicative.
8. INDEMNIFICATION.
8.1 Licensor agrees to hold Licensee, its partners, the partners of
any partnership that is a partner of Licensee, officers, employees, and
agents and the shareholders, officers, directors, employees and agents of the
partners or any corporation or partnership that is a partner of Licensee
(collectively the "Licensee Indemnitees"), harmless, from any claims,
deficiencies, assessments, liabilities, losses, damages, expenses (including,
without limitation, reasonable fees and expenses of counsel) (collectively,
"Losses") which any Licensee Indemnitee may suffer by reason of Licensor's
breach of, or non-compliance with, any covenant or provision herein contained
or the inaccuracy of any warranty or representation made in this Agreement
and any such damages shall be reduced by: (i) the amount of any net tax
benefit ultimately accruing to Licensee on account of Licensee's payment of
such claim; (ii) insurance proceeds which Licensee has or will receive in
connection with such claim, and (iii) any recovery from third parties in
connection with such claim; PROVIDED, HOWEVER, that Licensor shall not delay
payment of its indemnification obligations hereunder pending resolution of
any tax benefit or insurance or third party claim if Licensee provides
Licensor with an undertaking to reimburse Licensor for the amount of any such
claim ultimately received; and PROVIDED, FURTHER, that Licensee shall have no
15
obligation to obtain any such insurance proceeds or recovery from third
parties if and to the extent Licensor is subrogated (in form and substance
satisfactory to Licensor) to Licensee claims in respect of such insurance or
third parties.
8.2 Licensee agrees to indemnify Licensor, its direct and indirect
shareholders and all officers, directors, employees and agents of any of the
foregoing (the "Licensor Indemnitees") against and hold the Licensor
Indemnitees harmless from any and all Losses incurred or suffered by any
Licensor Indemnitee arising out of a breach by Licensee of the
representations, warranties, covenants or agreements made or to be performed
by it pursuant hereto, or arising out of any program or commercial material
(apart from the Programs) furnished by Licensee and any such damages shall be
reduced by: (i) the amount of any net tax benefit ultimately accruing to
Licensor on account of Licensor's payment of such claim; (ii) insurance
proceeds which Licensor has or will receive in connection with such claim,
and (iii) any recovery from third parties in connection with such claim;
PROVIDED, HOWEVER, that Licensee shall not delay payment of its
indemnification obligations hereunder pending resolution of any tax benefit
or insurance or third party claim if Licensor provides Licensee with an
undertaking to reimburse Licensee for the amount of any such claim ultimately
received; and PROVIDED, FURTHER, that Licensor shall have no obligation to
obtain any such insurance proceeds or recovery from third parties if and to
the extent Licensee is subrogated (in form and substance satisfactory to
Licensee) to Licensor claims in respect of such insurance or third parties.
8.3 The following procedures shall govern all claims for
indemnification made under any provision of this Agreement. A written notice
(an "Indemnification Notice") with respect to any claim for indemnification
shall be given by the party seeking indemnification (the "Indemnitee") to the
party from which indemnification is sought (the "Indemnitor") within thirty
(30) days of the discovery by the Indemnitee of such claim, which
Indemnification Notice shall set forth the facts relating to such claim then
known to the Indemnitee (provided that failure to give such Indemnification
Notice as aforesaid shall not release the Indemnitor from its indemnification
obligations hereunder unless and to the extent the Indemnitor has been
prejudiced thereby). The party receiving an Indemnification Notice shall
send a written response to the party seeking indemnification stating whether
it agrees with or rejects such claim in whole or in part. Failure to give
such response within ninety (90) days after receipt of the Indemnification
Notice shall be conclusively deemed to constitute acknowledgment of the
validity of such claim. If any such claim shall arise by reason of any claim
made by third parties, the Indemnitor shall have the right, upon written
notice to Indemnitee within 30 days after receipt of the Indemnification
Notice, to assume the defense of the matter giving rise to the claim for
indemnification through counsel of its selection reasonably acceptable to
Indemnitee, at Indemnitor's expense, and the Indemnitee shall have the right,
at its own expense, to employ counsel to represent it; PROVIDED, HOWEVER,
that if any action shall include both the Indemnitor and the Indemnitee and
there is a conflict of interest because of the availability of different or
additional defenses to the Indemnitee, the Indemnitee shall have the right to
select separate
16
counsel to participate in the defense of such action on its behalf, at the
Indemnitor's expense. The Indemnitee shall cooperate fully to make available
to the Indemnitor all pertinent information under the Indemnitee's control as
to the claim and shall make appropriate personnel available for any
discovery, trial or appeal. If the Indemnitor does not elect to undertake
the defense as set forth above, the Indemnitee shall have the right to assume
the defense of such matter on behalf of and for the account of the
Indemnitor; PROVIDED, HOWEVER, the Indemnitee shall not settle or compromise
any claim without the consent of the Indemnitor, which consent shall not be
unreasonably withheld. The Indemnitor may settle any claim at any time at
its expense, so long as such settlement includes as an unconditional term
thereof the giving by the claimant of a release of the Indemnitee from all
liability with respect to such claim.
9. TERM. The term of this Agreement shall be until
December 17, 2017. Any license in effect for any Program at the date of
termination of this Agreement shall continue through the Broadcast Period for
such Program, with no right of re-license or extension at the end thereof,
and all of the rights and obligations of the parties under this Agreement
with respect to such license will continue through the Broadcast Period for
such Program, it being agreed that the parties shall enter into mutually
satisfactory royalty arrangements with respect to the Broadcast Period
following the termination of this Agreement in order to compensate Licensor
for the use of Programs during such period and, if the parties are unable to
agree upon such royalty arrangements, the amount thereof shall be determined
based on prevailing market conditions.
In addition this Agreement may be terminated by either party in the
event that the other party (i) materially breaches its obligations hereunder
and fails to cure such breach within 180 days of notice thereof (90 days for
failure to pay the Program Royalty when due) by the party seeking termination
(which notice shall describe the breach in reasonable detail); PROVIDED,
HOWEVER, that the inaccuracy of any of Licensor's representations and
warranties contained in Section 7 hereof shall not be deemed to be a breach
of its obligations for purposes of this Section 9 to the extent that Licensor
satisfies its indemnification obligations with respect to such inaccuracy, or
(ii) asserts Force Majeure under Section 10 as a relief from substantially
all of its obligations hereunder for a period in excess of one year. Any
notice of material breach referred to in (i) above shall concurrently be sent
to the Managing Agents for any lenders providing financing to the Stations
and the Networks, and the Managing Agents on behalf of such lenders shall
have the right to cure such alleged material breach within such 90-day or
180-day cure period. Any notice of termination for Force Majeure pursuant to
(ii) above shall concurrently be sent to such Managing Agents.
10. FORCE MAJEURE. Neither party hereto shall be liable for or
suffer any penalty or termination of rights hereunder by reason of any
failure or delay in performing any of its obligations hereunder if such
failure or delay is occasioned by compliance with governmental regulation or
order, or by circumstances beyond the reasonable control of the
17
party so failing or delaying, including but not limited to acts of God, war,
insurrection, fire, flood, accident, strike or other labor disturbance,
interruption of or delay in transportation (a "Force Majeure Event"). Each
party shall promptly notify the other in writing of any such event of force
majeure, the expected duration thereof, and its anticipated effect on the
party affected and make reasonable efforts to remedy any such event, except
that neither party shall be under any obligation to settle a labor dispute.
If Licensor is prevented by a Force Majeure Event from delivering any
Accepted Program to Licensee, the running of the time period for purposes of
computing the applicable Broadcast Period for such Program shall be suspended
and, if such Force Majeure Event prevents Licensor from delivering any
substitute Programs to Licensee, then Licensee's obligations to pay the
Program Royalty under Section 5.1 hereof shall be reduced (but not below
zero) for the time period or periods so affected to the extent necessary to
compensate Licensee for the cost of obtaining substitute programming. Any
notice of Force Majeure sent pursuant to this Section 10 shall concurrently
be sent to the Managing Agents referred to in Section 9 above.
11. MODIFICATION. This Agreement shall not be modified or waived
in whole or in part except in writing signed by an officer of the party to be
bound by such modification or waiver.
12. WAIVER OF BREACH. A waiver by either party of any breach or
default by the other party shall not be construed as a waiver of any other
breach or default whether or not similar and whether or not occurring before
or after the subject breach.
13. JURISDICTION; VENUE; SERVICE OF PROCESS. Each of the parties
irrevocably submits to the jurisdiction of any California State or United
States Federal court sitting in Los Angeles County in any action or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby, and irrevocably agrees that any such action or
proceeding may be heard and determined only in such California State or
Federal court. Each of the parties irrevocably waives, to the fullest extent
it may effectively do so, the defense of an inconvenient forum to the
maintenance of any such action or proceeding. Each of the parties irrevocably
appoints CT Corporation System (the "Process Agent"), with an office on the
date hereof at ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇ as his or its
agent to receive on behalf of him or it and his or its property service of
copies of the summons and complaint and any other process which may be served
in any such action or proceeding. Such service may be made by delivering a
copy of such process to any of the parties in care of the Process Agent at
the Process Agent's above address, and each of the parties irrevocably
authorizes and directs the Process Agent to accept such service on its
behalf. As an alternate method of service, each of the parties consents to
the service of copies of the summons and complaint and any other process
which may be served in any such action or proceeding by the mailing or
delivering of a copy of such process to such party at its address specified
in or pursuant to Section 14. Each of the parties agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
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14. NOTICES. All notices and other communications required or
permitted hereunder shall be in writing, shall be deemed duly given upon
actual receipt, and shall be delivered (a) in person, (b) by registered or
certified mail (air mail if addressed to an address outside of the country in
which mailed), postage prepaid, return receipt requested, (c) by a generally
recognized overnight courier service which provides written acknowledgment by
the addressee of receipt, or (d) by facsimile or other generally accepted
means of electronic transmission (provided that a copy of any notice
delivered pursuant to this clause (d) shall also be sent pursuant to clause
(b)), addressed as set forth in Schedule 1 or to such other addresses as may
be specified by like notice to the other parties.
15. ASSIGNMENTS. Either of the parties may assign its rights
hereunder and delegate its duties hereunder, in whole or in part, to an
Affiliate capable to perform the assignor's obligations hereunder, and either
of the parties may assign its rights hereunder and delegate its duties
hereunder to any person or entity to which all or substantially all of such
party's businesses and assets are pledged or transferred. No such assignment
or delegation shall relieve any party of its obligations hereunder. Any such
assignment or delegation authorized pursuant to this Section 15 shall be
pursuant to a written agreement in form and substance reasonably satisfactory
to the parties and to the Managing Agents referred to in Section 9 above.
Except as otherwise expressly provided herein, neither this Agreement nor any
rights, duties or obligations hereunder may be assigned or delegated by any
of the parties, in whole or in part, whether voluntarily, by operation of law
or otherwise; provided, however, that Licensor may assign, grant a security
interest in or otherwise transfer its rights to payment hereunder in
connection with one or more financings. Any attempted assignment or
delegation in violation of this prohibition shall be null and void. Subject
to the foregoing, all of the terms and provisions hereof shall be binding
upon, and inure to the benefit of, the successors and assigns of the parties.
Nothing contained herein, express or implied, is intended to confer on any
person other than the parties or their respective successors and permitted
assigns, any rights, remedies, obligations or liabilities under or by reason
of this Agreement.
16. GOVERNING LAW. This Agreement and the legal relations among
the parties shall be governed by and construed in accordance with the laws of
the State of California applicable to contracts between California parties
made and performed in that State, without regard to conflict of laws
principles.
17. FURTHER ASSURANCES. Each party hereto agrees to execute any
and all additional documents and do all things and perform all acts necessary
or proper to further effectuate or evidence this Agreement including any
required filings with the U.S. Copyright Office.
18. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be an original instrument and all of which, when taken
together, shall constitute one and the same agreement.
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19. SEVERABILITY. If any provision of this Agreement, or the
application thereof, shall for any reason or to any extent be invalid or
unenforceable, then the remainder of this Agreement and application of such
provision to other persons or circumstances shall continue in full force and
effect and in no way be affected, impaired or invalidated; provided that the
aggregate of all such provisions found to be invalid or unenforceable does
not materially affect the benefits and obligations of the parties of the
Agreement taken as a whole.
20. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage may occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties may be
entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction pursuant to
Section 13, this being in addition to any other remedy to which they are
entitled at law or in equity.
21. ACKNOWLEDGEMENT OF SECURITY INTEREST. Pursuant to the
financing documents referred to in Section 9 above, the Administrative Agent
(for the benefit of the various lenders) has been granted a security
interest in and to all of Licensee's rights in this Agreement. The parties
hereto acknowledge and consent to the grant of such security interest.
22. PARTICIPATION AGREEMENT. All the terms and conditions of this
Agreement shall at all times be subject to the terms and conditions of the
Participation Agreement of even date herewith among Univision Television
Holdings, Inc, A. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Grupo Televisa, S.A., and Messrs.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, and if there is any
inconsistency between any terms and conditions of this Agreement and the
terms and conditions of the Participation Agreement, the Participation Agreement
shall prevail.
23. TELEVISA ADVERTISING. Advertising time which is not sold to
advertisers or used by the Network or the Stations for their own purposes
will be made available without charge to Televisa and its Affiliates. Other
than as set forth in the following sentence, such time may be used for
promotion or direct sale (i.e., telemarketing) of products or services now
or hereafter owned or being provided by Televisa or its Affiliates (including,
without limitation, theatrical motion pictures produced or being distributed
by any of them). Such time, however, will not be available for any product
or service that is marketed primarily by telemarketing that was not owned or
being provided by Televisa or its Affiliates as of December 17, 1992, and
provided, further, that such time may be preempted by the Network or any
Station to the extent that such time is to be sold to a paying advertiser.
Televisa and its Affiliates will be permitted to purchase for such purposes
advertising time which cannot be preempted by the Network or the Stations
for the lowest spot rate then being offered for a non-preemptable spot in the
program during which such
20
time is sold. Televisa may not, however, directly or indirectly make such
free or purchased time available to Persons other Affiliates. All material
provided for broadcast by the Televisa or its Affiliates shall comply with the
quality standards for unaffiliated advertisers established by the Network or the
Stations from time to time. The Board of Directors of Licensee, by a vote which
includes, in addition to any other required vote of directors, the affirmative
vote of a majority of the Class T Director(s) (so long as a Class T Voting
Conversion (as defined in the Restated Certificate of Incorporation of UCI) has
not occurred) or a majority of the Class V Director(s) (so long as a Class V
Voting Conversion (as defined in the Restated Certificate of Incorporation of
UCI) has not occurred, may make such rules in connection with the use of such
time by Televisa and its Affiliates as it determines to be appropriate,
including, without limitation, rules for the fair allocation of such time
between Televisa and [Venevision] and their respective Affiliates.
IN WITNESS WHEREOF, the parties have set their hands as of the
day and year first above written.
UNIVISA, INC.
By:___________________________
Title:________________________
THE UNIVISION NETWORK LIMITED
PARTNERSHIP
By: The Univision Network Holding
Limited Partnership
Its: General Partner
By: /s/[illegible]
---------------------------
Its: Managing Director
--------------------------
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