CONFIDENTIAL TREATMENT REQUESTED BY ACCESS INTEGRATED TECHNOLOGIES
INC. OF CERTAIN PORTIONS OF THIS AGREEMENT IN ACCORDANCE WITH RULE 24B-2
UNDER THE SECURITIES EXCHANGE ACT OF 1934
EXHIBIT 10.2
MASTER LICENSE AGREEMENT
THIS MASTER LICENSE AGREEMENT (this "AGREEMENT"), including all Schedules
and Exhibits attached hereto, is made and entered into as of the ___ day of
December, 2005 by and between CHRISTIE/AIX, INC., a Delaware corporation
("LICENSOR"), and CARMIKE CINEMAS, INC a Delaware corporation ("LICENSEE").
WHEREAS, Licensor has the right to install and license the use of certain
Equipment (as defined below); and
WHEREAS Licensee desires to obtain from Licensor, and Licensor is willing
to grant to Licensee, a license to use the Equipment on the terms and conditions
set forth in this Agreement, including all Schedules and Exhibits attached
hereto.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follow:
1. DEFINITIONS. As used in this Agreement, the following terms have the
meanings set forth below.
"ADM" means Access Digital Media, Inc., a Delaware corporation.
"AFFILIATE" means, with respect to a party, any corporation, limited
liability company, partnership or other entity which controls, is controlled by
or is under common control with such party, where such control is by ownership
of more than fifty percent (50%) of the outstandingvoting securities or other
voting interests.
"AGREEMENT" has the meaning specified in the preamble.
"APPLICABLE COMMENCEMENT DATE" means, as to the Equipment designated
on any Equipment Schedule, the date on which the License Term for such Equipment
commences, as specified in the applicable Certificate of Acceptance.
"APPLICABLE TERMINATION DATE" means, as to the Equipment designated on
any Equipment Schedule, the date on which this Agreement expires or is
terminated.
"CENTRAL SERVER" means, collectively, a central library server, with
TCC Software installed, together with a storage array, computer rack,
uninterrupted power source (UPS), main switch and patch panel.
"CERTIFICATE OF ACCEPTANCE" means a certificate executed by Licensee
in substantially the form of EXHIBIT 1 to EXHIBIT A attached hereto.
"CHRISTIE" means Christie Digital Systems USA, Inc., a California
corporation.
"CHRISTIE SOFTWARE" means any Christie proprietary software installed
in any of the Equipment at the time of delivery of such Equipment to Licensee,
as updated by any update made available from time to time by Christie without
charge for use on the Equipment.
"CINEPLEX" means a theater complex with one or more cinema
auditoriums.
"CONFIDENTIAL INFORMATION" has the meaning specified in Section 39.
"DCI" means Digital Cinema Initiatives, LLC, a limited liability
company established by Disney, Fox, MGM, Paramount, Sony Pictures Entertainment,
Universal and Warner Bros. Studios to, among other things, establish and
document technical specifications for an open architecture for digital cinema to
ensure a uniform and high level of technical performance reliability and quality
control.
"DCI SPECIFICATION" means the Digital Cinema System Specification V1.0
issued July 20, 2005 by DCI.
"DIGITAL CINEMA PROJECTION SYSTEM" means collectively a system
installed by Christie/AIX consisting of a DLP Cinema 2k projector, capable of
both 2-D and 3-D display, and a digital cinema server for each theatre screen.
Each Digital Cinema Projection System will be a part of a Digital System.
"DIGITAL SYSTEM" means collectively one or more Digital Cinema
Projection Systems, a central storage server connecting all Digital Cinema
Projection Systems within a theatre complex, a theater management system, and
such other system components and software as are required to meet the standards
set forth in the DCI Specification.
"DIGITAL TITLE" means a commercial movie which is released in digital
format suitable for showing on Digital Systems.
"DISTRIBUTOR" means a motion picture distributor.
"DISTRIBUTOR AGREEMENT" means an agreement between Licensor and a
Distributor pursuant to which such Distributor agrees to furnish virtual prints
of Traditional Motion Picture Content and to pay Participant Virtual Print Fees
to Licensor for a specified period.
"DLP CINEMA(TM) PROMOTIONAL GUIDELINES" means the guidelines set forth
on EXHIBIT B attached hereto. "DOLLARS" or "$" means United States dollars.
"EQUIPMENT" means each Digital System described on an Equipment
Schedule executed pursuant to this Agreement, together with all parts,
accessories and other items added to or made a part of such Digital System after
the Applicable Commencement Date for such Digital System.
"EQUIPMENT SCHEDULE" means a schedule in the form of EXHIBIT A
attached hereto, executed pursuant to this Agreement from time to time.
"EVENT OF DEFAULT" has the meaning specified in Section 28.
"FINANCING DOCUMENTS" has the meaning specified in Section 24.
"FINANCING PARTIES" has the meaning specified in Section 24.
"LICENSE TERM" means, with respect to any particular Equipment, a
period that commences on the Applicable Commencement Date for such Equipment and
ends on the Applicable Termination Date for such Equipment.
"LICENSEE" has the meaning specified in the preamble.
"LICENSOR" has the meaning specified in the preamble.
2
"NON-PARTICIPANT VIRTUAL PRINT FEE" means the applicable fee announced
from time to time by Licensor as the virtual print fee payable by a
Non-Participating Distributor with respect to the exhibition of Traditional
Motion Picture Content on Digital Systems licensed by Licensor, which fee shall
not exceed *** percent (***%) of the lowest base virtual print fee (before
discounts) payable by any Distributor under a Distributor Agreement.
"NON-PARTICIPATING DISTRIBUTOR" means a Distributor which has not
signed a Distributor Agreement with Licensor.
"NON-TRADITIONAL CONTENT" means all content other than Traditional
Motion Picture Content. Non-Traditional Content includes, but is not limited to,
television programs, sporting events, stage productions, religious services,
concerts, educational classes or presentations, live events, speeches, meetings,
teleconferencing, and video gaming. Non-Traditional Content shall not include
motion picture premieres and other promotional, testing and publicity activities
involving screenings of motion pictures.
"PARTICIPANT VIRTUAL PRINT FEE" means the virtual print fee payable to
Licensor by a Participating Distributor as provided for in the applicable
Distributor Agreement.
"PARTICIPATING DISTRIBUTOR" means a Distributor which has signed a
Distributor Agreement with Licensor. A list of Participating Distributors as of
the date hereof is set forth on EXHIBIT D attached hereto, and shall be updated
by Licensor from time to time as provided therein.
"SATELLITE DISH" has the meaning specified in Section 7(b).
"SERVICE CONTRACT" means a service contract between Licensee and
Christie in substantially the form of the attached EXHIBIT E.
"SOFTWARE" means, collectively, the Christie Software, the Standard
Software, the TCC Software and the Third Party Software.
"STANDARD SOFTWARE" means the operating system and system applications
software which are standard for general operation of computer servers having the
general capabilities of the servers included in the Equipment, as updated by any
update made available from time to time by the owner of such operating system or
systems application software.
"TAXES" means any foreign, federal, state, county or local income,
estimated, alternative minimum, add-on minimum, sales, use, excise, franchise,
real property, personal property, transfer, registration, value added, stamp,
premium, profit, windfall profit, customs duties, gross receipts, capital stock,
production, business and occupation, social security, disability, employment,
unemployment, payroll, severance, license, gift recapture or withholding tax or
charge imposed by any governmental entity, and any interest and penalties (civil
or criminal) related thereto or to the nonpayment thereof.
"TCC SOFTWARE" means ADM's proprietary Theatre Command Center software
as licensed by ADM to Christie and installed in any Central Server at the time
of delivery of such Central Server to Licensee, as updated by any update made
available from time to time without charge for use on the Equipment.
"THIRD PARTY SOFTWARE" means any software, other than Christie
Software, Standard Software and TCC Software, installed to any of the Equipment
at the time of delivery of such Equipment to Licensee, including database
software, as updated by any update made available from time to time by the owner
of such software.
----------
*** CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
3
"TRADITIONAL MOTION PICTURE CONTENT" means (i) all feature length
(defined as over 40 minutes) motion pictures intended for initial exhibition in
a commercial motion picture theater for paid admission; (ii) motion picture
trailers; and (iii) on screen advertising.
2. EQUIPMENT LICENSE.
Subject to the terms and conditions set forth herein, Licensor hereby
grants to Licensee the limited right and license to use the Equipment described
on each Equipment Schedule executed pursuant to this Agreement, at the
Licensee's designated facility set forth in each such Equipment Schedule, for
the License Term of such Equipment. Licensor and Licensee will execute a
separate Equipment Schedule for each delivery of Equipment to Licensee pursuant
to this Agreement, listing all of the Equipment included in such delivery. Each
such Equipment Schedule shall constitute a separate and independent license and
contractual obligation of Licensee and Licensor, governed by the terms and
conditions set forth in this Agreement. Notwithstanding the foregoing, except
for the limited license granted above, all right, title and interest to the
Equipment shall be, and shall continue to be, the property of Licensor and/or
its Affiliates, and, except for the limited license granted above, nothing in
this Agreement shall be construed as transferring to Licensee any right, title
or interest in the Equipment, or as conferring any other license or other right,
by implication, estoppel or otherwise, under any patent, patent application,
trade secret, trademark or copyright. Except as otherwise expressly provided for
in this Agreement, Licensee is not granted any right to, and Licensee expressly
agrees not to, distribute, market, sell, modify or adapt the Equipment or any
part thereof. Licensee shall not remove from the Equipment, Licensor's name,
trademark, logo and other identification, or any markings which identify
Licensor and/or its Affiliates as the owners of the Equipment.
3. SOFTWARE; CENTRAL SERVER FEE; LANDING FEE.
(a) Subject to Licensee's payment to Licensor of the fees provided for
in Section 3(b), Licensor, as an authorized licensee of ADM, hereby grants to
Licensee the non-exclusive, non-transferable right and license to use the TCC
Software in connection with Licensee's use of the Equipment. Licensee shall not
modify the TCC Software, make any copies of the TCC Software (other than a
reasonable number of copies for back up purposes), seek to reverse engineer or
decompile any of the TCC Software or transfer the TCC Software or any copies
thereof other than in connection with a transfer of a Central Server provided
that the transfer of such Central Server is permitted under this Agreement.
(b) For each Central Server licensed and delivered by Licensor to
Licensee under this Agreement and installed at a Cineplex, a Central Server fee
in the amount of $*** per screen (the "Server Screen Fee") will be payable for
each screen at such Cineplex for which a Digital Cinema Projection System
licensed and delivered by Licensor to Licensee under this Agreement is
installed. The Server Screen Fee shall be payable in arrears in quarterly
installments (without interest) over a period of *** years, and payments shall
commence at the end of the first quarter following the date a Certificate of
Acceptance is delivered with respect to a Digital Cinema Projection System
installed for such screen.
(c) Licensor, as an authorized licensee of Christie, hereby grants to
Licensee the non-exclusive, non-transferable, royalty-free right and license,
without right to sublicense, to use the Christie Software in connection with
Licensee's use of the Equipment. Licensee shall not modify the Christie
Software, make any copies of the Christie Software (other than a reasonable
number of copies for back up purposes), seek to reverse engineer or decompile
any of the Christie Software, or transfer the Christie Software or any copies
thereof other than in connection with a transfer of Equipment provided that the
transfer of such Equipment is permitted under this Agreement.
(d) Licensor represents and warrants to Licensee that, upon the
delivery of Equipment by Licensor to Licensee under this Agreement, Licensee
will have the royalty-free right to use, in connection with the use of such
Equipment and subject to the terms of any applicable end user license
agreements, the Standard Software and the Third Party Software installed on such
Equipment at the time of delivery.
----------
*** CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
4
(e) In the event that Access Integrated Technologies, Inc.
("AccessIT") delivers to Licensee any Digital Title or Non-Traditional Content
for Exhibition on the Equipment, Licensee will pay to AccessIT a landing fee in
the amount of eighteen dollars ($18) for each such Digital Title or
Non-Traditional Content.
4. TERM.
(a) This Agreement shall commence on the date hereof (it being
understood that obligations of Licensee relating to the use of Equipment will
only be effective when the Equipment is installed) and, unless earlier
terminated in accordance with Section 28, shall continue in effect until
December 31, 2020 (the "INITIAL TERM"); provided, however, that Licensee may
renew this Agreement for successive one (1) year periods (each such successive
one year period, a "RENEWAL TERM") for up to ten (10) Renewal Terms by giving
written notice to Licensor no later than ninety (90) days prior to the end of
the Initial Term or any Renewal Term.
(b) Upon the expiration of the Initial Term or a Renewal Term, as
applicable, or the earlier termination of this Agreement, Licensor shall, unless
Licensee exercises its purchase option under Section 47, have the right, at its
sole cost and expense, to retake possession of any or all of the Equipment, and
for such purpose Licensor shall have the right to enter upon any premises where
any or all of the Equipment is located, at times reasonably acceptable to
Licensee, and remove same. Such removal must be performed under supervision of
Licensee. Licensor shall repair all damage to the Cineplex caused by Licensor's
removal of such Equipment. If Licensor fails to remove the Equipment within 90
days of the expiration or earlier termination of this Agreement, such Equipment
will be deemed abandoned by Licensor, and Licensee may dispose of the same in
whatever manner Licensee may elect without liability to Licensor. Alternatively,
in the event such Equipment is deemed abandoned as provided above, Licensee may,
at its election by giving written notice to Licensor, succeed to ownership of
the Equipment on as "as is, where is" basis, in which case Licensor will have no
obligation to Licensee in respect of any expenses relating to removal or
disposition. This Section 4(b) shall survive the expiration or earlier
termination of this Agreement
5. INSTALLMENT.
(a) Licensor shall license to Licensee, and deliver to Licensee for
installation by Christie under the Service Contract, a minimum of Two Thousand
One Hundred (2,100) up to Two Thousand Three Hundred (2,300) Digital Cinema
Projection Systems, with associated Central Servers. Delivery of Digital Systems
shall be in accordance with a delivery schedule, specifying delivery dates for
all relevant delivery locations, mutually agreed upon between Licensor and
Licensee.
(b) Digital Systems will be installed in any given Cineplex for the
minimum number of screens required to enable more than 50% of the screens at
such Cineplex, and, Licensor will be permitted to install Digital Systems such
that by October 31, 2007 100% of the screens will be enabled at any Cineplex
where a Digital System has been installed.
(c) Except for Equipment (i) installed under this Agreement, (ii)
acquired by Licensee by virtue of acquisition of a Cineplex from a third party
or (iii) installed pursuant to Licensee's existing agreements ( or any
replacement thereof) for on-screen advertising with Technicolor Screen Services
Inc., Pepsi-Cola Sales and Distribution Inc. and The Coca-Cola Company or
replacements and/or extensions thereof provided that such Equipment shall be
used only for on-screen advertising and not for the exhibition of motion
picture, motion picture trailers and Non-Traditional Content, Licensee shall not
install, or permit to be installed, any digital cinema equipment, including
digital cinema projection equipment, screen servers or central servers, at any
Cineplex where a Digital System has been installed under this Agreement.
5
6. EQUIPMENT SPECIFICATIONS. Initially, Licensor will install Digital
Systems which comply with the DCI Specification. except to the extent that
technology necessary for compliance with the DCI Specification is not
commercially available. When the technology necessary to make Digital Systems
compliant with the DCI Specification becomes commercially available, Licensor,
at no cost to Licensee, will (a) thereafter install Digital Systems which are
compliant with the DCI Specification and (b) within four (4) months after such
availability upgrade Digital Systems previously installed in order to bring such
Digital Systems into compliance with the DCI Specification.
7. DELIVERY AND INSTALLATION; SATELLITE DISH.
(a) Following the execution by Licensor and Licensee of each Equipment
Schedule, Licensor shall, at Licensor's expense, deliver the Equipment described
in such Equipment Schedule to the Cineplex location designated in such Equipment
Schedule. Licensor shall bear the risk of loss for the Equipment while it is in
transit to Licensee sites at which the Equipment will be installed. Licensee
shall, at its own expense, prepare such sites for installation of the Equipment
in accordance with the site requirements as may be mutually agreed between
Christie and Licensee. All Equipment will be installed by Christie pursuant to
the Service Contract, and Licensee will permit Christie service engineers access
to the installation sites, at times mutually agreed upon by Christie and
Licensee, in order to install the Equipment. Upon completion of the installation
of any Equipment and testing to ensure the operability of the Equipment,
Licensee will deliver a Certificate of Acceptance for such Equipment to Licensor
or to Christie for delivery to Licensor. Licensee hereby authorizes Licensor to
complete each executed Equipment Schedule with the identification number set out
in the Certificate of Acceptance delivered by Licensee for the Equipment covered
by such Equipment Schedule. Licensor shall provide Licensee with copies of fully
completed and executed copies of each Equipment Schedule and Certificate of
Acceptance.
(b) In the event Licensee currently has the right to grant to Licensor
for the Initial Term or any Renewal Term of this Agreement the right to install
and maintain satellite transmitting and receiving equipment (a "SATELLITE DISH")
on the roof of any Cineplex site designated in an Equipment Schedule, Licensee
hereby grants to Licensor or its Affiliate, without charge or cost to Licensor,
the right, during the Initial Term or any Renewal Term of this Agreement, to
install and maintain, or to have installed and maintained, a Satellite Dish on
the roof of such Cineplex site for the sole purpose of delivering content to
Licensee. In the event Licensee does not currently have the right to install and
maintain a Satellite Dish on the roof of any Cineplex site designated in an
Equipment Schedule, Licensee shall, at the request of Licensor, use reasonable
commercial efforts to procure for Licensor, as promptly as reasonably possible
after request by Licensor, without cost to Licensor, the right, during the
Initial Term or any Renewal Term of this Agreement, to install and maintain, or
to have installed and maintained, a Satellite Dish on the roof of such Cineplex
site. In addition, Licensee shall, at Licensor's sole cost and expense, obtain
any permits necessary for the installation or maintenance of any such Satellite
Dish. The cost of installation and maintenance of any Satellite Dish will be the
sole responsibility of Licensor or its Affiliates. All right, title and interest
in and to any Satellite Dish installed hereunder will be the sole property of
Licensor or its Affiliates. Satellite Dishes are not included in the Equipment
licensed by Licensor to Licensee under this Agreement, and Licensee shall not
redirect, alter, move or otherwise in any way interfere with the operation of
any Satellite Dish without the prior written consent of Licensor, which consent
shall not be withheld unreasonably. If Licensee is unable to procure the right
to install a Satellite Dish on the roof of a Cineplex site, then Licensee shall
grant Licensor or its Affiliate access and the right to deliver to Licensee
content by hard drive, by other physical means or by use of fiber optic cables.
This Section 7 (b) shall survive the expiration or any termination of this
Agreement.
6
8. LOCATION. Without the prior written consent of Licensor, which consent
shall not be unreasonably withheld, Licensee shall not move any Equipment
(except when reasonably necessary in cases of emergency to protect the
Equipment) from the site and cinema auditorium location designated in the
Equipment Schedule for such Equipment. The moving of any Equipment by Licensee
other than in accordance with this Section 8 shall constitute a material breach
of this Agreement and the applicable Equipment Schedule. Notwithstanding the
foregoing, other than to a Cineplex acquired by Licensee from a third party,
Licensee agrees that it may not move any Equipment to a Cineplex which contains
digital projection equipment not installed by Licensor and Licensor's
withholding of any consent to such a move shall be deemed to be reasonable.
Licensee acknowledges and agrees that the objective of this Section 8 and
Section 5 of this Agreement is to provide Licensor with the ability to install
its Equipment in *** % of the screens at any Cineplex in which any of Licensor's
Equipment has been installed, whether through the initial deployment or by any
subsequent movement of Equipment pursuant to this Section 8.
If Licensee moves any Equipment pursuant to Licensor's consent under this
Section 8 to a Cineplex which contains an auditorium or auditoriums in which
Equipment has not been installed, and Licensee wishes to install other digital
projection equipment of any kind ("Alternative Digital Equipment") in any
auditoriums located in such Cineplex or in the auditorium(s) from which the
Equipment has been moved with Licensor's prior consent in accordance with this
the terms hereof, then Licensee must promptly provide Licensor with written
notice of a bona fide offer made to Licensee by a third party (the "Offer
Notice") specifying, among other things, the Alternative Digital Equipment it
wishes to install, the itemized costs of such Alternative Digital Equipment and
the installation thereof, the proposed sites at which Licensee proposes to have
such Alternative Digital Equipment installed, and any other conditions related
to such installations. Licensor shall have thirty (30) days from receipt of the
written notice to Offer Notice to provide a written proposal to Licensee that
either matches or improves upon the terms set forth in the Offer Notice. If
Licensor matches the terms contained in the Offer Notice, Licensee shall, within
thirty (30) days thereafter enter into an agreement providing for Licensor to
supply and install the digital projection equipment on substantially the terms
contained in the Offer Notice.
9. SCOPE OF LICENSE. Licensee shall be permitted to use Equipment for the
following purposes, and for no other purpose:
(a) exhibition of Traditional Motion Picture Content distributed by
Participating Distributors;
(b) exhibition of pre-feature on-screen advertising;
(c) exhibition of Traditional Motion Picture Content distributed by
Non-Participating Distributors provided that Licensor has notified Licensee that
the Non-Participating Distributor has paid to Licensor or made arrangements with
Licensor for payment to Licensor of all applicable Non-Participant Virtual Print
Fees in connection with such exhibition; and
(d) subject to the requirements of Section 11, exhibition of
Non-Traditional Content.
10. NO FEE TO DISTRIBUTORS. Licensee agrees that it will not charge any
Participating Distributor a fee or service charge for the use of any Digital
System to exhibit Distributor's theatrical motion pictures.
11. NON-TRADITIONAL CONTENT.
(a) Licensee hereby designates Access Integrated Technologies, Inc.
("AccessIT") as its preferred content delivery service for Non-Traditional
Content and Licensee agrees to use its commercially reasonable best efforts to
play content available from providers using AccessIT's content delivery service.
Licensee agrees that it will not enter into any other agreement with a third
party that would: (a)prohibit AccessIT from showing on the Equipment
Non-Traditional Content that Licensee, in its sole discretion, may choose to
book or (b) prohibit AccessIT from delivering digital content to Licensee's
theatres. If, the Non-Traditional Content is delivered by a delivery service
other than AccessIT on that delivery service's delivery software and equipment,
Licensee shall pay to Licensor for use of the Digital System (*** %) of the
gross revenues derived by Licensee from each show of such Non-Traditional
Content up to a maximum of $*** per show.
----------
*** CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
7
(b) If AccessIT is the content delivery service for the
Non-Traditional Content, Licensee shall pay Licensor *** per cent (***%) of the
gross revenues derived by Licensee from each show of such Non-Traditional
Content up to a maximum of $*** per show.
12. REPORTING AND EQUIPMENT LOGS.
(a) In order to facilitate accurate billing of virtual print fees
payable to Licensor with respect to the exhibition of Digital Titles on the
Equipment, Licensor and its representatives shall be entitled to access, review
and obtain copies, in such manner as Licensor may determine from time to time,
of all Log Files, as defined below. Licensee shall also be entitled to access to
the Log Files. Licensor and Licensee agree not to interfere with the use of the
Equipment for showing Digital Titles or the availability of access to the Log
Files. Log Files are electronic files created by the Equipment, including but
not limited to files containing information and records on the actual usage
history of each component of the Equipment and the specific title and time of
play for each usage.
(b) Licensor agrees to use the Log Files solely to monitor, assist and
verify the billing of virtual print fees and measuring Equipment performance.
Licensor shall not be permitted to access any financial records of Licensee.
13. EXHIBITION COMMITMENT. Provided that more than *** percent (***%) of
the screens in any Cineplex are equipped with Digital Cinema Projection Systems
licensed under this Agreement , then, if a motion picture which Licensee desires
to license is available from a Participating Distributor (or, subject to the
requirements of Section 10, a Non-Participating Distributor) in both a Digital
Title version and a film print version, Licensee is hereby required to license
and exhibit on a Digital System the Digital Title version rather than the film
print version provided that there is a screen equipped with a Digital Cinema
Projection System that is open to be booked with a movie commencing on the
opening date of that movie. Subject to the foregoing requirement, Licensee shall
have full and complete discretion over the choice of content at all of its
screens.
14. PROMOTION OF DLP CINEMA(TM). To the extent that Licensee is not
required to incur any additional advertising or other costs beyond its ordinary
marketing and advertising costs for its own business, Licensee shall use its
commercially reasonable best efforts to:
(a) promote DLP Cinema(TM) technology for the exhibition of Digital
Titles in accordance with the DLP Cinema(TM) Promotional Guidelines.
(b) include the DLP Cinema(TM) logo in all advertisements in all
media, including, but not limited to, print, newspaper and internet, issued by
or under the control of Licensee with respect to Digital Titles to be exhibited
by means of the Equipment, and insure that all such advertising is in accordance
with the DLP Cinema(TM) Promotional Guidelines.
(c) display the "DLP Cinema(TM)" trailer on screen preceding the
distributor's logo credit and at the beginning of each exhibition of
Non-Traditional Content.
Licensor shall obtain any approval(s) necessary for performing the
acts set forth in items (a) through (c) above, including, but not limited to,
any necessary approval of each Participating Distributor, Non-Participating
Distributor or provider of Non-Traditional Content, as applicable; and secure
all necessary royalty-free trademark licenses from Texas Instruments
Incorporated with regard to items (a) and (b) above.
----------
*** CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
8
15. MAINTENANCE AND TRAINING. Concurrently with the execution and delivery
of this Agreement, Licensee shall enter into the Service Contract with Christie.
During the Initial Term of this Agreement, Licensee shall maintain in effect the
Service Contract with Christie or a comparable service contract with another
service provider acceptable to Licensor and shall maintain the Digital Systems
in good order and repair during the Initial Term normal wear and tear excepted.
The Service Contract provides for training of Licensee personnel, and Licensee
will in any event maintain an adequate theater staff properly trained in the use
of Digital Systems. Licensee will not do anything which would render Digital
Systems non-compliant with, or prevent Digital Systems from being compliant
with, the DCI Specification during the term of this Agreement. Any replacement
parts substituted for any parts or components of Equipment shall become the
property of Licensor covered by the relevant Equipment Schedule for such
Equipment.
16. ADDITIONS AND ALTERATIONS.
(a) With the consent of Licensee, Licensor may from time to time at
Licensor's expense and by Licensor's designated representatives or contractors,
make alterations to, or add components, accessories, enhancements, features or
functionalities to, Equipment, and all of the foregoing shall, at the time of
such alteration or addition, become the property of Licensor covered by the
relevant Equipment Schedule for such Equipment.
(b) Except in accordance with paragraph (a) above or with the prior
written consent of Licensor, Licensee shall not make, or permit to be made,
alterations to, or additions of components, accessories, enhancements, features
or functionalities to, Equipment, provided that nothing contained in this
Section 17 shall prevent or be construed to prevent Christie from replacing
parts and components in connection with the maintenance services to be provided
by Christie under the Service Contract.
(c) With the prior written consent of Licensor, Licensee shall be
permitted to add components, accessories, enhancements, features or
functionalities to the Equipment and any such alterations or additions shall
remain the property of Licensee. Notwithstanding the foregoing, Licensee shall
not make any alterations or changes to or in relation to Equipment which would
impair or prevent the use of the Equipment for showing Digital Titles.
17. TAXES. The costs and fees set forth herein and in all Schedules and
Exhibits attached hereto and made a part hereof do not include any applicable
federal, state or local taxes, and any such taxes or governmental charges upon
the Equipment and any Software covered hereby, including sales or use taxes or
any other tax however designated arising from the subject matter of this
Agreement, shall be paid by Licensor.
18. DAMAGE AND LOSS
(a) After Installation, Licensee shall bear all risk of damage to or
loss or destruction of the Equipment by reason of any cause whatsoever,
including without limitation fire, flood, earthquake, natural disaster,
casualty, accident or theft. Licensee shall advise Licensor of any such damage,
loss or destruction in writing within five (5) days after any such damage, loss
or destruction occurs.
(b) In the event of any damage, loss or destruction which materially
impairs the performance of any Equipment or renders the Equipment inoperable and
which is capable of repair on a cost effective basis, then Licensee will, at its
expense, have Christie repair the Equipment under the Service Contract.
(c) In the event of any damage, loss or destruction which materially
impairs the performance of any Equipment or renders the Equipment inoperable and
which is not capable of repair on a cost effective basis, or in the event of any
complete loss or destruction of any Equipment, then Licensor, in its sole
discretion, may, at Licensee's expense, replace the Equipment with comparable or
better Equipment and Licensee shall do all things and execute all documents as
may be necessary in the judgment of Licensor to cause title to the replacement
Equipment to vest in Licensor and to subject the replacement Equipment to all of
the terms and conditions of this Agreement.
9
(d) In the event Licensee fails to promptly perform its obligations
under paragraph (b) or (c), then Licensor may, but is not obligated to, cause
the Equipment to be repaired or replaced and invoice Licensee for all costs of
such repair or replacement, which invoice shall be due and payable within ten
(10) days of the date of invoice.
(e) In no event will any damage to or loss or destruction of any
Equipment entitle Licensee to any refund of or credit for any amounts paid or
remitted by Licensee to Licensor under this Agreement, or excuse Licensee from
payment of any amounts otherwise payable by Licensee to Licensor under this
Agreement.
19. INSURANCE. Licensee, at its expense, will maintain throughout the term
of this Agreement a policy of insurance issued by a reputable insurer reasonably
acceptable to Licensor, insuring the Equipment against "all risks," including
extended coverage insurance, for a coverage amount at least equal to the full
replacement cost (at market value) of the Equipment. Licensor shall be named as
an additional loss payee under such policy, and such policy shall provide that
it may not be canceled except upon at least thirty (30) days prior written
notice to Licensor (or at least ten (10) days prior written notice for failure
to pay a premium). Upon Licensor's request, Licensee shall furnish to Licensor
insurance certificates or other satisfactory evidence of such insurance. If
Licensee fails to maintain insurance as required hereunder, Licensor may, but
shall not be obligated to, purchase such insurance and invoice Licensee for all
costs with respect thereto, which invoice shall be due and payable within (10)
days of the date of invoice.
20. AUDIT, INSPECTION AND ACCESS RIGHTS.
(a) Licensor shall have the right, through its designated
representatives (including Christie), at Licensor's expense, upon reasonable
prior notice and during regular business hours, to (a) examine Licensee's usage
records relating solely to the Equipment; (b) inspect the Equipment for purposes
of verifying (i) Licensee's compliance with all of its obligations under this
Agreement; (ii) the condition of the Equipment; and (iii) compliance of the
Equipment with the DCI Specification; and (c) examine Licensee's records
relating to Non-Traditional Content, including revenue and other records, for
the sole purpose of verifying compliance with Section 11 of this Agreement.
(b) Licensee shall maintain all books and records subject to audit
hereunder for a period of not less than three (3) years after the expiration or
any termination of this Agreement, and during such three (3) year period,
Licensor shall retain all audit and inspection rights set forth in this Section
21. Licensee shall provide all necessary access to the Equipment and the
relevant site location for purposes of such inspection and verification.
(c) Licensee will permit representatives of Distributors reasonable
access, upon reasonable prior notice and at times convenient to Licensee, to
Cineplex locations where the Equipment is located to (i) verify the operating
condition of the Equipment and, after the DCI Specification has been finalized
and issued, to verify that the Equipment is compliant with the DCI Specification
or to verify the upgrading of Equipment to meet the DCI Specification as
contemplated by this Agreement, and (ii) at no cost to Licensee install such
distribution equipment as may be necessary for Distributors to deliver content
files to such premises.
21. NEGATIVE PLEDGE. During the term of this Agreement, Licensee shall not
sell, convey, assign, transfer or otherwise dispose of any Equipment or any
interest therein, and shall keep such Equipment and its rights and interests
under this Agreement free and clear of all liens, security interests,
encumbrances, charges or adverse claims. Licensee shall promptly notify Licensor
of any liens, security interests, encumbrances, charges or adverse claims which
any third party files or seeks to enforce against the Equipment or any of
Licensee's rights and interest under this Agreement.
10
22. PERSONAL PROPERTY. It is the intention of Licensor and Licensee that
the Equipment at all times shall be and remain personal property, and shall not
be or become a fixture upon or affixed to any real property. The Equipment shall
not be affixed to realty so as to change the character of the equipment from
personal property to fixtures.
23. ASSIGNMENT AND SUBLEASE.
(a) Licensee shall not assign this Agreement or any Equipment
Schedule, or lease or sublicense the use of any of the Equipment, without the
prior written consent of Licensor in each instance, which consent shall not be
unreasonably withheld by Licensor; provided, however, Licensee may assign this
Agreement or any Equipment Schedule without Licensor's prior written consent (i)
to any direct or indirect subsidiary of Licensee, (ii) to any person or entity
resulting from a reorganization of Licensee, (iii) to any person or entity with
which Licensee is merged or consolidated, (iv) to any person or entity that
acquires all or substantially all of Licensee's assets or equity securities of
whatever type, (v) to Licencees's existing lenders or any other lender(s)
pursuant to loan documents evidencing debt obligations of Licensee (provided
such lender(s) shall have all rights of cure available to Licensee hereunder) or
(vi) to any person or entity that controls, is controlled by or is under common
control with Licensee.
(b) Licensor shall have the right to freely assign this Agreement and
any or all of the Equipment Schedules. In order to facilitate the financing of
the Equipment, Licensor may enter into agreements with one or more parties
pursuant to which, inter alia, Licensor may assign its right, title and interest
in this Agreement to such parties (referred to herein individually as a
"FINANCING PARTY" and collectively, as "FINANCING PARTIES"). Licensee
irrevocably consents to the transfer and assignment of Licensor's right, title
and interest in this Agreement to any and all Financing Parties and hereby
acknowledges and agrees for the benefit of each such Financing Party that upon
receipt by Licensor of written notice from a Financing Party that an event of
default has occurred and is continuing under any financing arrangements between
such Financing Party and Licensor with respect to the Equipment (such documents
referred to herein as the "FINANCING DOCUMENTS"), and a statement to the effect
that such Financing Party has elected to exercise its remedies pursuant to the
Financing Documents and this Agreement as a consequence of such default, the
Financing Party shall have the rights of Licensor hereunder, and Licensee shall
deal exclusively and directly with the Financing Party or its designee(s) or
assignee(s), as the case may be, and not Licensor.
24. WARRANTY DISCLAIMER. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
LICENSOR MAKES NO WARRANTIES TO LICENSEE, WRITTEN OR ORAL, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR USE OR PURPOSE OR NON-INFRINGEMENT, ALL OF WHICH IMPLIED
WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.
25. THIRD PARTY WARRANTIES. At the request of Licensee, Licensor shall, at
Licensee's option, (a) enforce for the benefit of Licensee any rights or
remedies which Licensor may have against any manufacturer or licensor in respect
of any of the Equipment or Software, including, but not limited to, rights or
remedies, if any, under any product warranty or any indemnification against
infringement, or (b) make a full or partial assignment to Licensee of any such
rights or remedies.
26. NON-PETITION COVENANT. During the period from the commencement of this
Agreement and ending on the date on which either party hereto ceases to have any
continuing obligations to the other under this Agreement, neither party shall
commence or join in any involuntary bankruptcy proceeding against the other
party under any federal or state bankruptcy law, or commence or join in any
proceeding for the appointment of a receiver or trustee for any or all of the
assets of the other party or for the liquidation or dissolution of such other
party.
27. EVENTS OF DEFAULT. The occurrence of any of the following events shall
constitute an "Event of Default" under this Agreement:
11
(a) failure by Licensee to make or remit any payments required to be
made or remitted by Licensee hereunder or under any Equipment Schedule as and
when the same become due and payable and such failure continues uncured for a
period of ten (10) days after written notice to Licensee; or
(b) the material breach by Licensee or any of its officers, employees
or authorized agents of any of its obligations hereunder or under any Equipment
Schedule (other than obligations referred to in paragraph (a) above), which
breach continues uncured for a period of thirty (30) days after written notice
to Licensee PROVIDED, HOWEVER, that to the extent such breach is susceptible of
cure and Licensee has commenced a cure within such period, such period shall
continue for as long as Licensee diligently pursues a cure;
(c) the termination by Licensee of the business of operating as an
exhibitor of commercial films;
(d) the making of an assignment by Licensee for the benefit of its
creditors or the admission by Licensee in writing of its inability to pay its
debts as they become due, or the filing by or against Licensee of any petition
under any bankruptcy or insolvency laws, which petition is not dismissed within
ninety (90) days, or the appointment of a receiver, liquidator or trustee for
any or all of the assets of Licensee, which appointment is not vacated within
ninety (90) days.
(e) the material breach by Licensor or any of its officers, employees
or authorized agents of any of its obligations hereunder or under any Equipment
Schedule which breach continues uncured for a period of thirty (30) days after
written notice to Licensor PROVIDED, HOWEVER, that to the extent such breach is
susceptible of cure and Licensor has commenced a cure within such period, such
period shall continue for as long as Licensor diligently pursues a cure;
(f) the substantial failure of a material quantity of the Equipment
installed under this Agreement to properly perform the functions for which said
Equipment was designed and installed during any consecutive six (6) month
period, which failure continues uncured for a period of thirty (30) days after
written notice to Licensor PROVIDED, HOWEVER, that to the extent such failure is
susceptible of cure and Licensor has commenced a cure within such period, such
period shall continue for as long as Licensor diligently pursues a cure.
(g) the making of an assignment by Licensor for the benefit of its
creditors or the admission by Licensor in writing of its inability to pay its
debts as they become due, or the filing by or against Licensor of any petition
under any bankruptcy or insolvency laws, which petition is not dismissed within
ninety (90) days, or the appointment of a receiver, liquidator or trustee for
any or all of the assets of Licensor, which appointment is not vacated within
ninety (90) days.
28. REMEDIES. Upon the occurrence and during the continuance of any Event
of Default, beyond applicable cure periods, the non-defaulting party shall have,
in addition to any other rights and remedies available at law or in equity all
of the following rights and remedies:
(a) the right to terminate this Agreement and any or all of the
Equipment Schedules;
(b) Upon the occurrence and during the continuance of any Event of
Default by Licensee beyond applicable cure periods, Licensor shall have the
right to retake possession of any or all of the Equipment, and for such purpose
Licensor shall have the right to enter upon any premises where any or all of the
Equipment is located and remove same;
(c) In the event of Default by Licensee, Licensor shall have the right
to recover any and all damages, including loss of virtual print fees, cost and
expenses, including reasonable attorneys' fees and costs, resulting from such
Event of Default or the enforcement of Licensor's remedies hereunder.
12
(d) In the event of Default by Licensor, Licensee shall have the right
to recover any and all damages, cost and expenses, including reasonable
attorneys' fees and costs, resulting from such Event of Default or the
enforcement of Licensee's remedies hereunder.
All rights and remedies are cumulative, and the exercise of any one right or
remedy shall not preclude the exercise of any other right or remedy.
29. LIMITATION ON DAMAGES. IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, EVEN IF SAID PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
30. INDEMNIFICATION.
Licensee shall indemnify and hold Licensor, its successors and
assigns, and their members, managers, partners, affiliates, officers, directors,
employees, agents, advisors and attorneys harmless from and against any and all
claims, costs, expenses, damages and liabilities, including attorneys' fees and
costs, arising out of the use, operation or possession of the Equipment or
otherwise related to this Agreement or any Equipment Schedule. The
indemnification rights hereunder shall survive the expiration or any termination
of this Agreement.
Licensor shall indemnify and hold Licensee, its successors and
assigns, and their members, managers, partners, affiliates, officers, directors,
employees, agents, advisors and attorneys harmless from and against any and all
claims, costs, expenses, damages and liabilities, including attorneys' fees and
costs, arising out of the use, operation or possession of the Equipment or
otherwise related to this Agreement or any Equipment Schedule. The
indemnification rights hereunder shall survive the expiration or any termination
of this Agreement.
31. REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSEE. Licensee hereby
represents, warrants and covenants to Licensor that (a) the execution, delivery
and performance of this Agreement by Licensee have been, and each Equipment
Schedule hereafter executed by Licensee will be, duly authorized by all
necessary corporate action on the part of Licensee; (b) the individual(s)
executing this Agreement on behalf of Licensee have the requisite authority to
do so, and the individual(s) executing any Equipment Schedule will have the
requisite authority to do so; (c) this Agreement does, and each Equipment
Schedule will, constitute the legal, valid and binding agreement of Licensee
enforceable in accordance with their respective terms; (d) Licensee or its
operating subsidiary is in good standing in the jurisdiction of its
incorporation or organization and in any jurisdiction in which any Equipment is
located; (e) Licensee shall comply with any and all applicable laws and
regulations relating to the use of the Equipment and Licensee's performance
under this Agreement and each Equipment Schedule; (h) there are no actions,
suits or proceedings pending, or to the knowledge of Licensee, threatened,
before any court or administrative agency, arbitrator or governmental body that
would materially adversely affect its ability to make payments or perform its
obligations under this Agreement or any Equipment Schedule; (i) Licensee is not
party to, and during the term of this Agreement will not enter into, any
exclusive arrangement other than with Licensor for the showing or delivery of
Traditional Motion Picture Content or other alternative digital content other
than for advertisements, or pursuant to Licensee's existing agreements with
Technicolor Screen Services Inc., Pepsi-Cola Sales and Distribution Inc. and The
Coca-Cola Company or replacements and/or extensions thereof.
13
32. REPRESENTATIONS, WARRANTIES AND COVENANTS OF LICENSOR. Licensor hereby
represents, warrants and covenants to Licensee that (a) the execution, delivery
and performance of this Agreement have been, and each Equipment Schedule
hereafter executed by Licensor will be, duly authorized by all necessary
corporate action on the part of Licensor; (b) the individual(s) executing this
Agreement on behalf of Licensor have the requisite authority to do so, and the
individual(s) executing any Equipment Schedule will have the requisite authority
to do so; (c) this Agreement does, and each Equipment Schedule will, constitute
the legal, valid and binding agreement of Licensor enforceable in accordance
with its terms; (d) Licensor is in good standing in the jurisdiction of its
organization and in each jurisdiction where the ownership or operation of its
property and assets or the conduct of its business requires such qualification;
(e) Licensor shall comply with any and all applicable laws and regulations
relating to Licensor's performance under this Agreement and each Equipment
Schedule; (f) there are no actions, suits or proceedings pending, or to the
knowledge of Licensor, threatened, before any court or administrative agency,
arbitrator or governmental body which would materially adversely affect its
ability to perform under this Agreement; (g) to Licensor's knowledge after due
inquiry, no part or component of the Equipment or Licensee's use thereof,
including without limitation, the Software, infringes or violates any patent,
copyright, trade secret, mask work right, trademark license or other
intellectual property right of any third party; (h) Licensor has the right to
grant the rights and licenses granted to Licensee under this Agreement, (i) the
Distributor Agreements executed as of the date hereof are valid, binding and of
full force and effect and none of the parties thereto are in default thereunder
and (j) Licensee's right and license hereunder to use the Equipment in
accordance with the terms hereof includes the royalty-free right to use the DLP
Cinema(TM) technology incorporated in the Equipment.
33. ENTIRE AGREEMENT. Licensor and Licensee acknowledge that there are no
agreements or understandings, written or oral, between Licensor and Licensee
with respect to the Equipment, other than as set forth herein and in each
Equipment Schedule, that this Agreement and the Equipment Schedules contain the
entire agreement between Licensor and Licensee with respect to the subject
matter hereof and thereof, and that no covenant, condition, or other term or
provision may be waived or modified orally.
34. APPLICABLE LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without giving effect to its
conflicts of laws principles.
35. SEVERABILITY AND VALIDITY. If any provision of this Agreement or any
Equipment Schedule is prohibited by, or is unlawful or unenforceable under, any
applicable law of any jurisdiction, such provision shall, as to such
jurisdiction, be ineffective to the extent of such prohibition, without
invalidating the remaining provisions thereof; PROVIDED, HOWEVER, that any such
prohibition in any jurisdiction shall not invalidate such provision in any other
applicable jurisdiction.
36. NOTICES. All notices hereunder shall be in writing, shall be effective
upon actual receipt shall be hand delivered, sent by overnight courier (such as
FedEx), or sent by registered or certified mail or delivered personally in
accordance with the following, or to such other address as either party may
specify to the other in writing:
LICENSOR: Christie/AIX, Inc.
-------- c/o Access Integrated Technologies, Inc.
00 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq., Senior
VP and General Counsel
With a copy to: Xxxxxx Xxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxxxx, Esq.
14
LICENSEE: Carmike Cinemas, Inc.
--------
0000 0xx Xxxxxx
Xxxxxxxx, XX 00000
Attn: CFO, CEO and Legal
With a copy to:
37. MODIFICATION AND WAIVER. No modification or waiver of any provision of
this Agreement or any Equipment Schedule shall be effective unless the same is
in writing and signed by both parties, and then such modification, waiver or
consent shall be effective only in the specific instance and for the specific
purpose given. Licensor and Licensee may, from time to time, mutually agree on
additional terms and conditions with respect to an Equipment Schedule which may
be set forth thereon or attached thereto as an "Addendum" which shall be
applicable to and constitute a part thereof.
38. CONFIDENTIALITY. Licensee acknowledges that the Equipment and Software
contain proprietary information and their configuration and operation constitute
trade secrets of Licensor or the respective owners thereof. In addition to the
foregoing, each party acknowledges that its officers, employees, agents or
representatives during the term of this Agreement will have access to and come
into contact with, confidential proprietary information of the other party,
including, but not limited to, information concerning the Equipment and/or the
Software and/or other trade secrets of Licensor and information pertaining to
Licensee's finances, personnel and business practices ("CONFIDENTIAL
INFORMATION"). Licensor and Licensee agree not to disclose to any third party
any Confidential Information that it learns during the term of this Agreement
without the prior written consent of the other party. This obligation shall
survive the cancellation or other termination of this Agreement. The parties
hereby agree to use their best efforts to maintain the confidentiality of the
Confidential Information and to treat such Confidential Information with the
same degree of care and security as they treat their own most confidential
information. Notwithstanding the foregoing, the parties' obligations with
respect to the Confidential Information shall not extend to information that:
(a) is in the public domain at the time of its disclosure; (b) becomes part of
the public domain through a source other than Licensee; or (c) is required to be
disclosed pursuant to law, a court order or governmental authority, whereupon
Licensee shall provide Licensor with notice prior to such disclosure unless
otherwise forbidden by law. The parties shall be required to advise each of
their employees, agents and representatives who have access to Confidential
Information that they are required to keep Confidential Information in the
strictest confidence, but in all cases, Licensor and Licensee shall retain
responsibility for any breach by an employee, agent and/or a representative of
the confidentiality obligations set forth in this Section 39. It is understood
that in case of a breach of this Section 39, damages may not be an adequate
remedy and the Licensor may be entitled to injunctive relief to restrain any
breach, whether threatened or actual, of this Section 39.
39. PRECEDENCE. In the event of any conflict between the terms and
conditions of this Agreement and the terms and conditions of any properly
executed Equipment Schedule, the terms and conditions of such Equipment Schedule
shall prevail.
40. NO WAIVER. The failure by either party to exercise any right or remedy
provided for in this Agreement will not be deemed to be a waiver of any right or
remedy hereunder.
41. SECTION HEADINGS. The section headings are for the convenience of the
parties and in no way alter, modify, amend, limit, or restrict the contractual
obligations of the parties.
42. COUNTERPARTS; EXECUTION BY FACSIMILE. This Agreement and each Equipment
Schedule may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which shall be one and the same document.
This Agreement and each Equipment Schedule may be executed and delivered by
facsimile transmission.
43. NO JOINT VENTURE OR PARTNERSHIP. The parties are entering into this
Agreement as Licensor and Licensee, and nothing herein shall be deemed to create
or constitute a joint venture or partnership between the parties or a
principal-agent relationship. Neither party has the authority to bind or
contract on behalf of the other party.
44. ANNOUNCEMENTS. No public announcement, circular, advertisement or other
publicity in connection with this Agreement shall be made or issued by or on
behalf of either party to this Agreement, except as may be required by law,
judicial order or applicable regulation, except by mutual agreement of the
parties as evidenced by the prior written consent of the other party. Both
parties shall mutually agree upon the content of any public statement announcing
the existence of this Agreement.
15
45. THEATER CLOSURES. If at any time during the term of this Agreement,
Licensee discontinues operations at any theater with respect to which it has
executed an Equipment Schedule and a Certificate of Acceptance, this Agreement
and the Equipment Schedule for such theater shall terminate as of the end of the
last day of business operations at such theater. Licensee shall have the option
to (a) utilize the Equipment located at such theater in any other theater
operated by Licensee or its Affiliates which does not have Equipment or (ii)
have such Equipment picked up by Licensor or its designated representatives. If
Licensee elects to use the Equipment in accordance with (i) above, Licensee and
Licensor shall execute a mutually acceptable new Equipment Schedule and
Certificate of Acceptance for the theater in which the Equipment is installed in
accordance with the terms of this Agreement.
46. THEATER SALES AND ACQUISTIONS. If during the term of this Agreement,
Licensee or its Affiliates sell, transfer, convey or assign to a third party
their respective interest in any theater with respect to which Licensee has
executed an Equipment Schedule and Certificate of Acceptance, Licensee or its
Affiliates may, with the prior consent of Licensor, which will not unreasonably
be withheld, transfer the Equipment in such transaction so long as such acquirer
or transferee executes and delivers to Licensor a Master License Agreement in
the same form as this Agreement and an Equipment Schedule in the form attached
as Exhibit A. Upon such transfer, Licensee shall have no further obligation
under this Agreement or the Equipment Schedule for such theatre. If during the
term of this Agreement, Licensee or its Affiliates shall acquire a Cineplex
Licensee shall have the right to designate such Cineplex(s) for inclusion
hereunder and Licensee shall be entitled to either relocate existing Equipment
to such Cineplex, or if the initial *** screens have not been enabled with
Digital Systems then Licensee may notify Licensor that said Cineplex(s) be
Digitally enabled thereafter.
47. LICENSEE'S OPTION TO PURCHASE; EQUIPMENT RETURN.
(a) At any time following the expiration of the Initial Term, Licensee
shall have the option to purchase all or any portion of the Equipment. The
purchase option for any Equipment may be exercised by Licensee by providing
Licensor with at least 60 days written notice (the "PURCHASE NOTICE") specifying
the Equipment Licensee is electing to purchase. The purchase price (the
"PURCHASE PRICE") for such Equipment shall be equal to the fair market value of
the Equipment to be purchased as of the date the Purchase Notice is given to
Licensor. The fair market value of the Equipment shall be determined by an
independent third party appraiser selected by Licensee and approved by Licensor,
which approval may not be unreasonably withheld ("1st Appraiser"). Either party
may dispute the 1st Appraiser's value by notifying the other party of such
dispute and submitting a second independent third party appraiser("2nd
Appraiser") who shall determine the market value of said Equipment. In the event
the two appraisers cannot agree on the Equipment's value then the matter shall
be submitted to arbitration in accordance with the rules of the American
Arbitration Association.
(b) Upon the exercise of the purchase option in Section 47(a) above
which is not rescinded, title to such Equipment shall pass from Licensor to
Licensee upon the payment of the Purchase Price on an "AS IS, WHERE IS" basis,
without warranty of any kind, express or implied, other than Licensor's warranty
of good title and warranty that such equipment is transferred free of all liens,
security interests, claims or encumbrances of any kind or nature. Licensor shall
comply with the DCI Specification requirements regarding the Digital Systems
that are contained in the Distributor Agreements, as may be amended from time to
time throughout the term of the Distributor Agreements. Licensor shall deliver
to Licensee a duly executed and appropriate xxxx of sale in form and substance
reasonably acceptable to Licensee, evidencing transfer of title of the Equipment
purchased. Upon payment of the Purchase Price, this Agreement shall terminate
with respect to such Equipment and the Equipment Schedule(s) relating to the
Equipment so purchased shall be appropriately amended or terminated, as
applicable.
----------
*** CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
16
(c) In the event the Licensee does not exercise its purchase
option, the removal of the Equipment shall be subject to the terms and
conditions of this Agreement.
49. MFN. In the event that during the Roll-Out Period Licensor offers to install
a Digital System for a third party on terms and conditions which are comparable
to the terms and conditions of this Agreement but on financial terms which in
the aggregate are more favorable than the financial terms of this Agreement,
then Licensor shall promptly offer the more favorable financial terms to
Licensee.
17
IN WITNESS WHEREOF, the duly authorized representatives of the parties
hereto have executed this Agreement as of the date and year first above written.
LICENSOR LICENSEE
By: By:
------------------------- -------------------------
Name: Name:
------------------------- -------------------------
Title: Title:
------------------------- -------------------------
18
LIST OF EXHIBITS
EXHIBIT A Form of Equipment Schedule/Certificate of Acceptance
EXHIBIT B DLP Cinema(TM) Promotional Guidelines
EXHIBIT C Intentionally Omitted
EXHIBIT D Participating Distributors
EXHIBIT E Form of Service Contract
EXHIBIT F Intentionally Omitted
EXHIBIT G Intentionally Omitted
EXHIBIT H Intentionally Omitted
EXHIBIT I Form of Monthly Report
Exhibit A
EXHIBIT A
EQUIPMENT SCHEDULE NO. ___
DATED AS OF ___________
TO MASTER LICENSE AGREEMENT DATED AS OF _________
1. EQUIPMENT
QTY ITEM DESCRIPTION SERIAL NUMBER AUDITORIUM LOCATION IDENTIFIER
2. LOCATION, SCREENS AND REQUESTED DATE FOR INSTALLATION
THEATER NAME:
THEATER ADDRESS:
NUMBER OF SCREENS:
REQUESTED DATE OF INSTALLATION:
Exhibit A
3. SPECIAL TERMS (IF ANY).
Licensor and Licensee ____ have _____ have not agreed on any special terms for
the license by Licensor to Licensee of the Equipment specified in this Equipment
Schedule. In the event Licensor and Licensee have agreed on any such special
terms, such special terms are as set forth on a separate schedule attached
hereto and made a part hereof.
This Equipment Schedule is executed pursuant to the Master License Agreement
dated as of the date indicated above between Licensor and Licensee (the
"Agreement"). All of the terms and conditions of the Agreement are incorporated
herein by this reference and made a part hereof as if such terms and conditions
were set forth in full in this Equipment Schedule. By executing this Equipment
Schedule, Licensor and Licensee hereby reaffirm all of the terms and conditions
of the Agreement except as expressly modified hereby.
LICENSOR LICENSEE
By: By:
------------------------- -------------------------
Name: Name:
------------------------- -------------------------
Title: Title:
------------------------- -------------------------
Date: Date:
------------------------- -------------------------
Exhibit A
EXHIBIT 1 TO EXHIBIT A
CERTIFICATE OF ACCEPTANCE
THIS CERTIFICATE OF ACCEPTANCE is executed as of ____________, 20__ with
respect to the Equipment itemized in Equipment Schedule No. __ dated as of
________________, 20__ (the "Equipment Schedule") executed pursuant to that
certain Master License Agreement dated as of ______________, 20__ (the
"Agreement") between Christie/AIX, Inc. ("Licensor") and the undersigned
("Licensee").
1. CERTIFICATION
Licensee hereby certifies that the items of Equipment described in the
Equipment Schedule have been installed at the location specified in the
Equipment Schedule, have been inspected by Licensee, have been found by Licensee
to be in good working condition and have been accepted by Licensee as Equipment
whose use is licensed by Licensor under the Agreement and the Equipment
Schedule.
2. COMMENCEMENT DATE
The commencement date of the license term under the Agreement and the
Equipment Schedule for the Equipment accepted hereunder is
_______________________ (the "Commencement Date").
IN WITNESS WHEREOF, Licensee has executed this Certificate of Acceptance as
of the date first above written.
"LICENSEE"
By:
-------------------------
Name:
-------------------------
Title:
-------------------------
Exhibit 1 to Exhibit A
EXHIBIT B
DLP CINEMA(TM) PROMOTIONAL GUIDELINES
(EXHIBIT STARTS ON NEXT PAGE)
Exhibit B
[GRAPHIC OMITTED]
Exhibit B
[GRAPHIC OMITTED]
Exhibit B
[GRAPHIC OMITTED]
Exhibit B
[GRAPHIC OMITTED]
Exhibit B
EXHIBIT C
INTENTIONALLY OMITTED
Exhibit C
EXHIBIT D
PARTICIPATING DISTRIBUTORS
The Participating Distributors as of December 15, 2005 are as set forth
below. In the event of any additions to the Participating Distributors after
such date, Licensor shall promptly so notify Licensee in writing and this
Exhibit D shall be deemed updated to include any Participating Distributor
specified in any such notice.
Buena Vista Pictures Distribution
Twentieth Century Fox Film Corporation
Sony Pictures Releasing Corporation
Dreamworks LLC
Universal City Studios LLLP
Exhibit D
EXHIBIT E
FORM OF SERVICE CONTRACT
Exhibit E
EXHIBIT F
INTENTIONALLY OMITTED
Exhibit F
EXHIBIT G
INTENTIONALLY OMITTED
Exhibit G
EXHIBIT H
INTENTIONALLY OMITTED
Exhibit H
EXHIBIT I
FORM OF MONTHLY REPORT
Exhibit I
