PROGRAMMING AGREEMENT
This Programming Agreement (the "Agreement") is entered into as of this
5th day of November, 1996 by and between UC Television Network Corp. ("UCTN") a
Delaware corporation, with its principal place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("UCTN"), and ▇▇▇▇▇▇ Private Networks, Inc.
a Georgia corporation, with its principal place of business at ▇▇▇ ▇▇▇ ▇▇▇▇▇▇,
▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("Turner"). (UCTN and Turner are
collectively referred to herein as the "Parties").
WITNESSETH:
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WHEREAS, UCTN owns and operates the UCTV Network (the "Network") which
provides programming in a place-based single channel environment in common areas
on college campuses;
WHEREAS, UCTN desires that ▇▇▇▇▇▇ provide the Programs (as hereinafter
defined) to UCTN for exhibition on the Network;
WHEREAS, ▇▇▇▇▇▇ desires to become the exclusive supplier of news and
sports programming to UCTN for exhibition on the Network;
THEREFORE, in consideration of the mutual covenants contained herein
and the mutual benefits to be derived therefrom and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
I. Representations and Authorizations
A. UCTN.
UCTN represents and warrants to ▇▇▇▇▇▇: (i) that it is the owner and
operator of the Network and hereby grants to ▇▇▇▇▇▇ the exclusive
right to provide programming to the Network as described herein; (ii)
that it has the full power and authority to execute, deliver and
perform under this Agreement and to consummate any and all
transactions provided for herein; and (iii) that the execution,
delivery and performance of this Agreement and the consummation of any
and all transactions contemplated by this Agreement, and the
fulfillment of and compliance with the terms and conditions of this
Agreement do not and will not violate or conflict with, or constitute
a material breach of or default under, any existing contracts or
commitments to which UCTN is a party or by which it may be bound.
▇. ▇▇▇▇▇▇.
▇▇▇▇▇▇ represents and warrants to UCTN: (i) that it has the full power
and authority to execute, deliver and perform under this Agreement and
to consummate any and all transactions provided for herein; (ii) that
the execution, delivery and performance of this Agreement, and the
consummation of any and all transactions contemplated by this
Agreement, and the fulfillment of and compliance with the terms and
conditions of this Agreement do not and will not violate or conflict
with, or constitute a material breach of or default under, any
existing contracts or commitments to which ▇▇▇▇▇▇ is a party or by
which it may be bound; (iii) that the Programs do not violate any
third party's right of copyright; (iv) any re-use, residual and other
similar fees payable with respect to the production and distribution
of the Programs have or will be paid by ▇▇▇▇▇▇; and (v) that the
non-dramatic performing rights to each musical composition in each
Program are: (a) controlled by ASCAP, BMI or SESAC; (b) controlled by
▇▇▇▇▇▇ to the extent necessary to permit UCTN's use of the Programs as
authorized hereunder; or (c) in the public domain. To the extent
rights and clearances to musical compositions and recordings necessary
for UCTN's use of the Programs are not controlled by ▇▇▇▇▇▇, UCTN
acknowledges that such rights and clearances are not granted herein,
and UCTN shall, at its sole cost and expense, secure all necessary
public performance licenses necessary for the exhibition by UCTN of
each musical composition contained in each Program.
II. Term and Exhibition Period
The term of this Agreement shall commence on the date of execution of this
Agreement and shall continue through December 31, 1999 (the "Term"). The
Exhibition Period for the Programs licensed hereunder shall be January 1,
1997 to December 31, 1999 (the "Exhibition Period").
III. Programs and Features
A. Description.
Throughout the Term, ▇▇▇▇▇▇ shall produce and provide to UCTN a total
of four hundred sixty two (462) news and sports programs, each of
which shall be approximately seven to ten (7-10) minutes in duration
and shall be comprised of topical segments, including News; Sports;
College Weather Scroll; and Factoids (the "Program(s)"). The Programs
shall be of first-class broadcast quality according to generally
accepted industry standards and shall be comparable to other CNN
programs. The host, the format and the set for the Programs, as well
as the graphics included as part of the Programs, shall
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be mutually agreeable to UCTN and ▇▇▇▇▇▇, when considered in the
context of the budget for the Programs. The foregoing matters shall be
agreed upon by the parties not later than November 30, 1996. ▇▇▇▇▇▇
shall have absolute and complete discretion, editorial and otherwise,
with respect to the content, production, editing and updating of the
Programs. In addition, it is expressly acknowledged and agreed that
the Cable News Network ("CNN") logo shall appear on-screen at all
times in the Programs, and that the CNN logo shall be of a size
generally accepted in the television industry.
B. Delivery.
Turner shall assemble and deliver the Programs to UCTN for exhibition
on the dates set forth on the Delivery Schedule attached hereto as
Exhibit "A" and incorporated herein by reference. With respect to
costs of delivery, ▇▇▇▇▇▇ shall be responsible for the expense of
transmitting the Programs via a T-1 line to ▇▇▇▇▇▇ satellite
facilities in Germantown, Maryland for UCTN's distribution to
individual colleges. ▇▇▇▇▇▇ may, at its sole option, utilize a direct
satellite feed to the ▇▇▇▇▇▇ facilities in lieu of the T-1 line. UCTN
shall be responsible for any expenses incurred downlinking any such
satellite feed; for all expenses related to the MPEG- I encoding
system and the installation thereof, which system shall be mutually
acceptable to both parties with regard to technical performance, video
quality and operating characteristics; and for all T-1 connecting
equipment and installation costs at all connection points.
IV. Program Fee and Payment Schedule
A. Program Fee.
As consideration for the Programs supplied to UCTN under this
Agreement, UCTN agrees to pay ▇▇▇▇▇▇ the amount of Eight Hundred
Ninety Thousand Ninety-Five Dollars ($890,095.00) (the "Program Fee").
B. Payment.
The Program Fee shall be paid to ▇▇▇▇▇▇ as follows:
Thirty Thousand Dollars ($30,000.00) upon execution of this Agreement;
The balance of the Program Fee (Eight Hundred Sixty Thousand
Ninety-Five Dollars) ($860,095.00) shall be paid in thirty-six (36)
equal monthly installments of Twenty-Three Thousand Eight Hundred
Ninety-One Dollars ($23,891.00) each, due on the first (1st) day of
each month of the Term, commencing on January 1, 1997.
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V. Ownership, Copyright and Distribution
A. Ownership and Copyright of the Programs.
It is expressly acknowledged and agreed that, as between UCTN and
▇▇▇▇▇▇, ▇▇▇▇▇▇ shall own and retain, throughout the universe, and in
perpetuity, the exclusive ownership of all rights in and to the
Programs, including all rights of trademark (other than UCTN
trademarks used in the Programs), copyright and copyright renewal. In
addition, ▇▇▇▇▇▇ shall have the exclusive right and interest in and to
any royalty payments deriving from the Programs to which it may be
entitled pursuant to Sections 111(d) and 119 of the Copyright Act of
1976, as now existing or hereafter amended (the "Copyright Act"), or
similar legislation that may hereafter be enacted, or from any other
entity collecting and distributing retransmission royalties anywhere
throughout the universe. ▇▇▇▇▇▇, or its designee(s), may make whatever
application is necessary to petition for such royalty payments. UCTN
and/or the Network agree to perform all such acts and execute all such
documents as ▇▇▇▇▇▇ may, in its sole discretion desire or require in
order to comply with the requirements of the Copyright Act, such
similar legislation or such other entity. ▇▇▇▇▇▇'▇ exclusive ownership
and control of the Programs shall be absolute and without any further
obligation whatsoever to UCTN or to any third party except as
specifically provided herein.
B. UCTN's Use of Programs.
▇▇▇▇▇▇ grants to UCTN the right to exhibit the Programs on the Network
once per hour at such time as UCTN in its discretion may decide.
Except as otherwise provided below in this Paragraph V(B), UCTN shall
not edit, insert material into, or otherwise alter the material
contained in the Programs as delivered by ▇▇▇▇▇▇. The foregoing
restriction shall not apply to insertions of advertising materials or
to local segments produced by colleges or universities in designated
spots in the Program(s). UCTN may not exhibit or otherwise use any
Program or any portion thereof in any inspect after the date upon
which such program is initially exhibited without the written consent
of ▇▇▇▇▇▇. ▇▇▇▇▇▇ may not market, sell, license or otherwise
distribute the Programs to any other party; provided, however, that
▇▇▇▇▇▇ may exercise its rights with respect to individual segments of
the Program(s) (the "Segments"). ▇▇▇▇▇▇'▇ rights in and to the
Segments shall include, without limitation, the right to distribute,
transmit, display, project, exhibit, license, simulcast, cablecast,
telecast, broadcast and otherwise exploit the Segments and any
portions thereof, and the right to authorize others to exercise such
rights, throughout the universe, in any and all languages, in
perpetuity, and in any and all media, whether now known or hereafter
devised.
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VI. Advertising Time and Content
Except as provided in this paragraph, UCTN shall have the right to sell all
advertising time within the Programs and to retain all revenue derived
therefrom. It is expressly acknowledged and agreed that ▇▇▇▇▇▇ shall
receive one (1) thirty second promotional spot per hour to use for
promotional advertising for cable networks owned and/or operated by ▇▇▇▇▇▇
Broadcasting System, Inc. not to exceed a value of three hundred fifty
thousand dollars ($350.000.00) for year one (1997), with an increase of ten
percent (10%) for year two (1998) and an additional increase of ten percent
(10%) for year three (1999), which value shall be calculated by using the
lowest rate paid to UCTN by any paid advertiser. ▇▇▇▇▇▇ shall receive the
foregoing thirty second promotional spot per hour regardless of the value
of such spot(s) during 1997.
VII. Exclusivity; Right of First Negotiation
▇▇▇▇▇▇ shall be the exclusive programming supplier of news and sports
programming for the Network during the Term of this Agreement; provided,
however, that such exclusivity shall not prevent UCTN from obtaining and
excluding local segments produced by colleges and universities. ▇▇▇▇▇▇
shall have, at all times, a right of first negotiation with respect to
continuing as the exclusive news and sports programming supplier for the
Network, and with respect to becoming the exclusive advertising sales
representative for the Network.
Specifically, UCTN agrees that prior to negotiating with any other party
regarding the right to produce or provide news and sports programming to
the Network, or regarding the exclusive right to sell advertising on the
Network, UCTN shall notify ▇▇▇▇▇▇ in writing and shall negotiate in good
faith with ▇▇▇▇▇▇ for a period of not more than thirty (30) days from
▇▇▇▇▇▇'▇ receipt of such notice to arrive at an agreement pertaining to
▇▇▇▇▇▇'▇ continuing as the exclusive news and sports programming supplier
for the Network or becoming the exclusive advertising sales representative
for the Network. If UCTN and ▇▇▇▇▇▇ are unable to reach an agreement within
said thirty (30) day period, UCTN may then negotiate with other parties
regarding the rights mentioned above.
This paragraph shall survive the termination of this Agreement.
For the period commencing on the date of this Agreement and terminating on
the first anniversary date of the date of this Agreement, ▇▇▇▇▇▇ shall have
a two week, "first look" right with respect to programming produced by UCTN
for non residential use; provided, however, such "first look" right shall
not apply to programming to be displayed by UCTN or an affiliate of UCTN.
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VIII. Good Faith Negotiation Regarding Future Business Relationship
The Parties agree to negotiate in good faith with respect to establishing a
future business arrangement between them, which shall include possible
equity participation in UCTN by ▇▇▇▇▇▇ as well as joint marketing of
advertising time on the Network for a period of ninety (90) days from the
date of execution of this Agreement; provided, however, that this Agreement
and the parties' performance hereunder is in no respect conditioned upon
the outcome of the negotiations referenced in this paragraph.
IX. General Provisions.
A. Indemnification.
1. ▇▇▇▇▇▇ hereby agrees to assume liability for, and shall
indemnify, defend, protect, save and hold harmless UCTN, the
Network, their related entities, and their respective agents,
officers, directors, employees, successors, licensees, assignees
and attorneys, from and against any and all claims,
counterclaims, actions, suits, costs, liabilities, liens,
judgments, obligations, losses, penalties, damages or expenses of
any nature whatsoever, including, without limitation, reasonable
attorneys' fees (including, without limitation, an applicable
share of in-house attorneys' costs and expenses) and court costs,
whether fixed or contingent, threatened or actual, known or
unknown, liquidated or unliquidated, of any kind or nature
whatsoever (collectively, "Claims"), imposed on, incurred by, or
asserted against UCTN, the Network, their related entities, and
their respective agents, officers, directors, employees,
successors, licensees, assignees and attorneys, by any third
party, arising out of or related to, or allegedly arising out of
or related to the Programs, including, but not limited to, any
actual or alleged libel, slander, invasion of privacy or
infringement of copyright or other intellectual property rights,
or any breach or alleged breach of any representation, warranty,
covenant or obligation of ▇▇▇▇▇▇ contained in or made pursuant to
this Agreement, except to the extent any Claim arises out of or
relates to a breach by UCTN of any of its representations,
warranties, covenants or obligations contained herein or made
pursuant hereto.
2. UCTN hereby agrees to assume liability for, and shall indemnify,
defend, protect, save and hold harmless ▇▇▇▇▇▇ and its related
entities, and their respective agents, officers, directors,
employees, successors, licensees, assignees and attorneys, from
and against, any and all Claims imposed on, incurred by, or
asserted against ▇▇▇▇▇▇ and its related entities, and their
respective agents, officers, directors, employees,
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successors, licensees, assignees and attorneys, by any third
party, arising out of or related to, or allegedly arising out of
or related to any breach or alleged breach of any representation,
warranty, covenant or obligation of UCTN contained in or made
pursuant to this Agreement, except to the extent any Claim arises
out of or relates to a breach by ▇▇▇▇▇▇ of any of its
representations, warranties, covenants or obligations contained
herein or made pursuant hereto.
B. Termination.
1. If either party is in default in the performance of its material
obligations hereunder, the non-defaulting party may terminate
this Agreement if such default if curable, remains uncured after
receipt of five (5) days' written notice from the non-defaulting
party.
In the event of termination of this Agreement by UCTN for any
reason other than a material breach of this Agreement by ▇▇▇▇▇▇,
which, for purposes of this Agreement, shall include the failure
to deliver or withdrawal of an aggregate of three (3) Programs,
▇▇▇▇▇▇ shall then, upon presentment of proper documentation
and/or receipts, be entitled to receive payment for all
outstanding costs and expenses incurred by ▇▇▇▇▇▇ in connection
with producing the Programs, as well as all actual out-of-pocket
closing costs associated with terminating production and delivery
of the Programs to UCTN (such costs to include, without
limitation, severance payments, if necessary, in accordance with
▇▇▇▇▇▇ standard policies, and remaining capital costs
outstanding); provided, however, that in no event shall UCTN's
payment pursuant to this provision exceed the amount representing
the unpaid portion of the Program Fee.
2. In the event this Agreement is terminated by UCTN for any reason,
other than a material breach of this Agreement by ▇▇▇▇▇▇, UCTN
agrees that it shall not have discussions with any third party
regarding news and sports programming rights nor shall it grant
such rights to any third party for a period of six (6) months
following termination of this Agreement; provided, however, that
upon remitting to ▇▇▇▇▇▇ any -------- ------- unpaid portion of
the Program Fee, UCTN shall have the right to negotiate and/or
enter into an agreement with any third party, provided UCTN has
complied with the provisions of paragraph VII of this Agreement.
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C. Withdrawal Rights.
▇▇▇▇▇▇ may, in its absolute discretion, permanently or temporarily
withdraw any Program or any portion thereof at any time as it deems
necessary or advisable in the exercise of its sound business judgment
and any such withdrawals, interruption, delay or interference shall
not constitute or be deemed to be a breach of this Agreement;
provided, however, that ▇▇▇▇▇▇ agrees to use its best efforts to
deliver a substitute Program as soon as possible.
In the event ▇▇▇▇▇▇ withdraws or fails to deliver a Program, ▇▇▇▇▇▇
shall reimburse or credit UCTN for: (i) The pro-rata portion of the
Program Fee allocable to such Program; and (ii) lost advertising
revenue from advertising time which actually has been sold with
respect to such withdrawn Program.
D. Force Majeure.
Neither party shall be liable to the other for any failure to perform
under this Agreement caused by or due to an event of force majeure,
such as any act of God, inevitable accident, fire, lockout, strike or
other labor dispute, riot or civil commotion, act of public enemy,
failure of transportation facilities, enactment, rule, order or act of
government or governmental instrumentality (whether domestic or
international and whether federal, state or local, or the
international equivalent thereof), failure of technical facilities,
including satellite failures or feed failures, or any other cause of
any nature whatsoever beyond the control of the Parties hereto which
was not avoidable.
E. Notices.
All notices which either party hereto is required or may desire to
give to the other party hereunder shall be in writing and shall be
given either by personal delivery (including by means of overnight
delivery services), telegram, telex (toll prepaid), telecopy or other
electronic means or by registered or certified mail (postage prepaid),
air mail if available. Such notices shall be deemed given on the date
delivered, telegraphed, telexed, telecopied or otherwise delivered by
electronic means or, if mailed, on the date received. Until further
notice, all notices given hereunder shall be addressed to Turner and
UCTN as follows:
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TO TURNER:
▇▇▇▇▇▇ Private Networks, Inc.
Mr. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
cc: Office of the General Counsel
▇▇▇▇▇▇ Broadcasting System, Inc.
One CNN Center, 13 North
P. O. Box 105366
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
TO UCTN:
UC Television Network Corp., lnc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
cc: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Kramer, Levin, Naftalis & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
F. Severability.
Nothing contained in this Agreement shall be construed to require the
commission of any act contrary to law, statute, ordinance, order or
regulation, and wherever there is any conflict between any provision of
this Agreement and any of the foregoing, contrary to which the Parties
hereto have no legal right to contract, such law, statute, ordinance, order
or regulation shall prevail; provided, however, in such event: (a) the
provision of this Agreement so affected shall be limited only to the extent
necessary to permit compliance with the minimum legal requirement; (b) no
other provisions of
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this Agreement shall be affected thereby; and (c) all such other provisions
shall continue in full force and effect. The Parties shall negotiate in
good faith to replace any invalid, illegal or unenforceable provision with
a valid provision, the effect of which comes as close as possible to that
of such invalid, illegal or unenforceable provision.
G. Further Documents.
Each party hereto shall execute any and all further instruments which
either party may deem reasonably necessary, desirable or proper to
carry out the purposes of this Agreement.
H. Prior Agreements; Waivers; Paragraph Headings, Modification.
This Agreement supersedes all prior agreements and understandings
between the Parties hereto, whether oral or written, pertaining to the
subject matter hereof No waiver of any term or condition of this
Agreement shall be construed as a waiver of any other term or
condition hereof; nor shall any waiver of any default under this
Agreement be construed as a waiver of any other default hereunder. The
descriptive headings of the paragraphs of this Agreement are for
convenience only and do not constitute a part of this Agreement. This
Agreement may be modified only by a written instrument executed by the
Parties hereto.
I. Governing Law.
This Agreement shall in all respects be governed by, and construed in
accordance with, the laws of the state of New York applicable to
contracts.
J. Assignments.
Neither party shall assign any of its rights or obligations hereunder,
voluntarily or by operation of law, without the prior written consent
of the other party, unless such assignment is made to an entity
controlling, controlled by or under common control with the assigning
party, or to an entity which acquires all or substantially all of the
assets of the assigning party.
K. Confidentiality.
During the term of this Agreement and thereafter, neither UCTN nor
▇▇▇▇▇▇ shall disclose to any third party any information regarding the
terms and conditions of this Agreement, except: (i) to the minimum
extent necessary to comply with the law or valid court order; (ii) as
part of its normal reporting or review procedure
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to its board members, shareholders, lenders, auditors and attorneys;
or (iii) in order to enforce its rights or perform its obligations
under this Agreement. Any information released to the public regarding
this Agreement, including, without limitation, press releases, must be
agreed upon and approved by both Parties.
L. Non-Compete.
During the term of this Agreement: (a) UCTN agrees that it will not
directly or indirectly compete with or attempt to compete with ▇▇▇▇▇▇
with respect to utilization of the Programs or any portion thereof in
any manner at any time; and (b) ▇▇▇▇▇▇ agrees that it will not provide
customized sports and news programming to any college or university
television network or program service which is directly competitive
with UCTN. Furthermore, for a period of one (1) year following
termination of this Agreement for any reason, ▇▇▇▇▇▇ shall not create
a college television network.
M. Survival
All representations, warranties and indemnities contained herein or
made by either party in connection herewith shall survive the
execution, delivery, suspension. expiration and termination of this
Agreement or any provision hereof
N. Relationship of Parties.
Nothing herein shall be deemed to create an employment, joint venture,
agency or partnership relationship between the parties hereto. The
Parties hereto acknowledge and represent that they are independent
contractors with respect to each other.
O. Insurance.
With respect to the Programs, ▇▇▇▇▇▇ shall procure and maintain in
full force and effect until the end of the Term, standard producer's
liability (errors & omissions) insurance issued by a nationally
recognized insurance carrier, with minimum limits of at least
$1,000,000 for any single occurrence and $3,000,000 for all claims in
the aggregate. Such insurance shall name UCTN as an additional insured
and shall be evidenced by a Certificate of Insurance indicating that
such coverage shall be primary and not contributing to or in excess of
any such insurance maintained by UCTN. ▇▇▇▇▇▇ shall deliver a valid
Certificate of Insurance to UCTN not later than five (5) days after
execution of this Agreement, evidencing the existence of such
insurance coverage with certified copy of the endorsement of
insurance.
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P. Reservation of Rights.
Any and all rights in and to the Programs which are not expressly
granted to UCTN herein are reserved to ▇▇▇▇▇▇ and may be exercised,
marketed, exploited and disposed of by ▇▇▇▇▇▇ concurrently with and
throughout the Term of this Agreement freely and without limitation or
restriction.
AGREED TO AND ACCEPTED BY:
UC TELEVISION NETWORK, INC.
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: CEO
▇▇▇▇▇▇ PRIVATE NETWORKS, INC.
By:/s/ ▇▇▇ McMacnamara
-------------------
▇▇▇ McMacnamara
Title: President
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EXHIBIT "A"
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