PLAYBOY ENTERPRISES INC - FORM 10-Q - EX-10.2 - EXHIBIT 10.2

Attached files

file	filename
EX-10.1 - EXHIBIT 10.1 - PLAYBOY ENTERPRISES INC	ex10_1.htm
EX-10.6 - EXHIBIT 10.6 - PLAYBOY ENTERPRISES INC	ex10_6.htm
EX-10.3 - EXHIBIT 10.3 - PLAYBOY ENTERPRISES INC	ex10_3.htm
EX-10.4 - EXHIBIT 10.4 - PLAYBOY ENTERPRISES INC	ex10_4.htm
EX-10.5 - EXHIBIT 10.5 - PLAYBOY ENTERPRISES INC	ex10_5.htm
EX-32 - EXHIBIT 32 - PLAYBOY ENTERPRISES INC	ex32.htm
EX-31.2 - EXHIBIT 31.2 - PLAYBOY ENTERPRISES INC	ex31_2.htm
EX-31.1 - EXHIBIT 31.1 - PLAYBOY ENTERPRISES INC	ex31_1.htm
EX-10.7 - EXHIBIT 10.7 - PLAYBOY ENTERPRISES INC	ex10_7.htm
10-Q - PLAYBOY ENTERPRISES INC 10-Q 3-31-2010 - PLAYBOY ENTERPRISES INC	form10q.htm

Exhibit 10.2

Portions of this Exhibit have been omitted pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. The omissions have been indicated by asterisks (“*****”), and the omitted text has been filed separately with the Securities and Exchange Commission.

DATED 29 MARCH 2010

ARQIVA LIMITED (1)

AND

PLAYBOY TV UK/BENELUX LIMITED (2)

AGREEMENT FOR THE PROVISION OF CONNECTIVITY, UPLINKING AND SATELLITE SERVICES

ARQIVA LIMITED

Crawley Court

Winchester

Hampshire

SO21 2QA

THIS AGREEMENT is made on the 29th day of March 2010

BETWEEN

(1)	ARQIVA LIMITED (registered in England under number 02487597) whose registered office address is at Crawley Court, Winchester, Hampshire SO21 2QA (“Company”);

AND

(2)	PLAYBOY TV UK/BENELUX LIMITED (registered in England under number 3000033) whose registered office is at Aquis House, Station Road, Hayes, Middlesex UB3 4DX (“Customer”) together (the “Parties”).

RECITALS

(A)	The Company is in the business of providing certain satellite and terrestrial services to its customers.

(B)	The Customer wishes to engage the Company to supply and the Company has agreed to supply certain satellite services (the “Services”) to the Customer for use in connection with its television business on the terms and subject to the conditions of this Agreement.

(C)	The Services that the Company shall provide to the Customer shall include, MPEG-2/DVB encoding, multiplexing, BSkyB Adaptation, and the provision of uplink facilities and access to Digital Capacity on the Satellite specified in this Agreement.

(D)	The Company will procure the Digital Capacity required to provide the Services from the Satellite Provider on the terms and subject to the conditions of the Supply Agreement.

IT IS HEREBY AGREED AS FOLLOWS:

1. DEFINITIONS AND INTERPRETATIONS

1.1	In this Agreement unless the context requires otherwise the following terms shall have the following meanings:

“Agreement”		means this agreement together with the Schedules and any appendices as any of the same may be amended from time to time.

“Business Hours”		means 09.00 until 17.30 hours local time at the relevant location on any Working Day.

“Channel”		means the Customer’s television channels currently known as Playboy TV, The Adult Channel, Spice Extreme, Climax 1, Climax 2, Climax 3 and Top Shelf TV or such other name as the Customer may from time to time determine.

“Commencement Date”		means the date upon which this Agreement is executed by the Company having previously been executed by the Customer.

“Company Equipment”		means any Equipment which is not Customer Equipment that is provided and used by the Company to provide the Service detailed in this Agreement;

“Company Compression System”		the digital compression and multiplexing system provided and maintained by the Company and located at the Customer Premises and described in Schedule 1;

“Connectivity”		means any circuit required to transfer the Content from the Interface Point to the transmission facilities at the Uplink Site.

“Content”		means the material comprised in the Channel provided by the Customer for conveyance by the Service.

“Customer Equipment”		means any equipment provided by the Customer to the Company to enable it to provide the Services.

“Customer Premises”		means Aquis House, Station Road, Hayes, Middlesex, UB3 4DX

“Digital Capacity”		means the digital satellite capacity to be used by the Company to provide the Service, as defined in Paragraph 1.2 of Schedule One by reference to the Option Levels set out in Clause 2 of Schedule Seven.

“DTH”		means the distribution of television, radio or data signals by satellite “direct to home” for reception at the homes/premises of individual viewers.

“Encoding”		means the process of creating a single digital composite data stream from either video or audio (or both) programme information.

“Interactive Services”		means the interactive streaming services specified in Schedule Eight.

“Interface Point”		means the point at which the Content will be made available to the Company, as specified in the Interface Specification.

“Interface Specification”		means the technical specifications set out in Schedule Five defining the interface at

		which the Content will be made available to the Company.

“MCR”		means the Company's Master Control Room, located at the Uplink Site.

“OFCOM”		means OFCOM or any replacement or successor body and references in this Agreement to OFCOM shall include references to that replacement or successor body.

“Remaining Service”		means the Service which excludes the Digital Capacity which will be provided by the Company to the Customer.

“Satellite”		means the satellite specified in Schedule Six on which the Digital Capacity is provided, or such other Satellite which is designed for DTH services in geostationary orbit located at 28.5 degrees East or a similar orbital slot and having an equivalent footprint as the Company may use to provide the Services in accordance with Clause 4.2.

“Satellite Provider”		means the party which is detailed in Schedule Six from which the Company procures the Digital Capacity.

“Service”		means the services described in Schedule One which the Company will provide to the Customer on the terms and subject to the conditions of this Agreement.

“Service Charges”		means the service charges to be paid by the Customer for the Service in accordance with the payment terms set out in Clause 6 in the amounts set out in Schedule Two.

“Service Credits”		means the service credits which the Customer may claim for Service Interruptions as detailed in Clause 8.1.

“Service Description”		means the service description set out in Schedule One which describes the Service that the Company will provide to the Customer.

“Service Interruption”		means a service interruption as described in Clause 8.1 which may entitle the Customer to claim Service Credits.

“Service Commencement Date”		means the date on which carriage of the Channel and provision of the Service

		commences, as specified in Schedule One.

“Service Period”		means the period commencing on the Service Commencement Date and ending on the Service Termination Date.

“Service Termination Date”		means the date on which the carriage of the Channel and provision of the Service ceases, as specified in Schedule One.

“Supply Agreement”		means the agreement between the Company and the Satellite Provider under which the Company procures the Digital Capacity.

“Term”		means the duration of this Agreement which commences on the Commencement Date or the Services Commencement Date if earlier and terminates on the Service Termination Date.

“Territory”		means the territory in which the Customer delivers the Channels to end users which are located within the footprint of and subject to the parameters of the Satellite

“Transponder”		means the Transponder on the Satellite specified in Schedule Six as varied from time to time pursuant to Clause 4.2.

“Uplink Site”		means the Company’s Teleports at Chalfont Grove, Bedford, Winchester or such other teleport which the Company may use to provide the Service pursuant to Clause 4.3.

“Working Day”		means any day Monday to Friday except for bank and public holidays in England and Wales.

“Year”		means each complete period of twelve (12) calendar months, commencing with the Service Commencement Date.

1.2

Except where the context otherwise requires words denoting the singular include the plural and vice versa, and words denoting either gender include both genders and words denoting persons include natural persons, firms and corporations and vice versa. This Agreement includes the Schedules attached hereto and incorporated herein by reference.

1.3	References in this Agreement to Clauses and Schedules shall unless otherwise provided be references to the Clauses and Schedules of this Agreement.

1.4	Headings are included in this Agreement for ease of reference only and shall not affect the interpretation or construction of this Agreement.

1.5

A reference to any statute, enactment, order, regulation or other similar instrument shall be construed as a reference to the statute, enactment, order, regulation or instrument as amended by any subsequent statute, enactment, order, regulation or instrument or as contained in any subsequent re-enactment of it.

1.6	Except where the context otherwise requires terms and expressions used in this Agreement shall have the same meaning as is commonly ascribed to them in the Broadcasting, Telecommunications and IT industries.

1.7	Any phrase introduced by the word “including”, “include” or any similar expression shall be construed as illustrative and the words following any such word shall not limit the sense of the words preceding such words.

1.8	In the event and to the extent only of any conflict or inconsistency between the Clauses of this Agreement and the Schedules, the Clauses of this Agreement shall prevail.

2. PURPOSE AND DURATION

2.1	This Agreement shall become effective on and from the Commencement Date and, subject to the early termination provisions set out in Clause 12, shall continue until the end of the Service Period.

2.2	In consideration of the Customer paying the Service Charges to the Company in the amounts and in the manner specified hereunder the Company will provide the Service to the Customer on the terms and subject to the conditions of this Agreement during the Term.

3.	THE PARTIES’ OBLIGATIONS

3.1 The Company’s Obligations:

3.1.1

For the duration of the Service Period, the Company shall provide the Service to the Customer in accordance with the Service Description set out in Schedule One, on the terms and subject to the conditions of this Agreement.

3.1.2

The Company will procure, install and maintain the Company Equipment at the Uplink Site in order to perform the Services. The Company Equipment shall remain the property of the Company.

3.1.3

The Company shall procure the supply of the Digital Capacity from the Satellite Provider for use in the provision of the Service.

3.1.4

Subject to the Customer complying with all of its obligations under Clause 3.2.3 in accordance with the required timescale, the Company shall install and operate any Customer Equipment so that it is available for use in the provision of the Service from the Service Commencement Date.

3.1.5

The Company shall obtain and maintain any necessary licence or permission to provide the Service under the Wireless Telegraphy Act 2006 or any successor legislation and all other licenses, consents, or approvals necessary to perform its obligations hereunder, save only to the extent that the Customer is expressly obliged to procure the same pursuant to the terms of this Agreement or by law.

3.1.6

For the avoidance of doubt, the Service does not include and the Company shall not provide installation, commissioning or maintenance of the digital satellite receivers (or “digiboxes”) for end users.

3.2 Customer Obligations

3.2.1

The Customer shall obtain and maintain any necessary licences that may be required in respect of the transmission or carriage of the Content using the Service, including but not limited to any licence required to be issued by OFCOM or any successor body in the United Kingdom or required under the Broadcasting Acts 1990 and 1996 and inform the Company of any material changes thereto as they relate to the licences required pursuant to the Services under this Agreement.

3.2.2

The Customer shall inform the Company prior to the Service Commencement Date of all relevant technical information describing any EPG services with which it is being supplied by BSkyB, including, but not limited to, the programme number and shall advise the Company of any changes to such technical information prior to their becoming effective.

3.2.3

The Customer will supply or procure the supply of all Customer Equipment in accordance with the required timescales to enable the Company to provide the Service on and from the intended Service Commencement Date. The Customer shall ensure that the Customer Equipment shall comply with the requirements set out in Schedule Three so as to enable the Company to carry out its obligations pursuant to Clause 3.1. The Company shall operate the Customer Equipment in accordance with operational procedures agreed with the Customer subject to the Customer providing appropriate training for the Company at the Customer’s cost.

3.2.4

In relation to monitoring of the encrypted services the Customer will ensure that any viewing cards forming part of the Customer Equipment are authorised prior to the Service Commencement Date and continue to be authorised for the duration of the Service Period.

3.2.5

Not used.

3.2.6

The Customer shall use the Service only for the purpose of distributing the Channel within the Territory.

3.2.7

The Customer shall pay the Service Charges for the duration of the Service Period in accordance with the provisions of Clause 6 in the amount specified in Schedule Two.

3.2.8

The Customer shall provide such information as the Company and/or the Satellite Provider shall require to enable it (being the Company and/or the Satellite Provider) to provide the Service in a timely manner and shall ensure that any such information is accurate, complete and up to date.

3.2.9

If and to the extent that the Customer has to attend the Uplink Site or any other premises owned by the Company or any of its subcontractors the Customer will comply with all and any reasonable policies and procedures of which it is given notice including but not limited to those policies and procedures relating to health and safety, access and security.

3.2.10

The Customer shall present the signals which are to be transmitted to the Company as specified in Schedule Five.

3.2.11

Where the Company provides the Service at the Customer Premises the Customer shall be responsible for:

3.2.11.1

preparation and maintenance of the Customer Premises in accordance with the specification as detailed in Schedule 1, including but not limited to the provision of suitable accommodation, power supplies and air conditioning for the Company Compression System to be installed at the Customer Premises; and

3.2.11.2

obtaining (and paying any charges or costs for) all necessary planning permissions and landlord approvals and consents (i) to install the Company Compression System at the Customer Premises and (ii) for the connection and operation of the Service at the Customer Premises (for the avoidance of doubt this does not include any planning permissions, landlord approvals and consents for land not occupied or owned by the Customer); and

3.2.11.3

the Company Compression System installed at the Customer Premises and for its proper use in accordance with the Company’s written instructions. If any part of such Company Compression System is lost, destroyed or damaged by the Customer, its employees, agents or its subcontractors, the Customer shall pay the Company’s cost for its replacement or repair as applicable. The Customer must not interfere with the Company Compression System or permit anybody else to do so; and

3.2.11.4

granting the Company or any of its subcontractors access to the Customer Premises in order to enable the Company or its subcontractors to carry out work necessary for installing and maintaining the Company Compression System and maintaining the Service. Where possible, the Company will provide notice to the Customer of any access required to the Customer Premises.

3.2.12

If and to the extent that the Company or any of its subcontractors has to attend the Customer Premises or any other premises owned by the Company the Company or its subcontractors will comply with all and any reasonable policies and procedures of which it is given notice including but not limited to those policies and procedures relating to health and safety, access and security.

3.3	The Company’s Rights

3.3.1

The Company may provide the Service by any particular technical or operational means and/or change the technical or operational means by which it provides the Service at any time during the Service Period provided that any such change does not have a material adverse effect on the provision of the Service which the Company shall continue to provide in accordance with the Service Description set out in Schedule One.

3.3.2

If the Customer is overdue with any payment then, without prejudice to any other right or remedy available to the Company and subject in any event to fourteen (14) days prior written notification by the Company to the Customer of its intention to exercise the rights set out in this Clause, the Company reserves the right to exercise a lien over any Customer Equipment which is at the Uplink Site until the Customer has made such overdue payment in full without settlement or deduction. For the avoidance of doubt the exercise of any such lien shall not affect the Customer’s obligation to pay any amounts due under this Agreement.

4. PROVISION OF THE SERVICE

4.1 Commencement of the Service

4.1.1

Without prejudice to the Customer’s obligation to pay the Service Charges from the Service Commencement Date, the Company shall not be obliged to commence provision of the Service for so long as any of the following circumstances exist:

(i)

a material breach by the Customer of any of its obligations under this Agreement; or

(ii)

the failure or unavailability of any satellites, transponders, facilities, services or systems (excluding those provided by the Company under this Agreement) provided that such failure or unavailability is not directly caused by any failure by the Company to carry out any of its obligations pursuant to this Agreement; or

(iii)

a request in writing from the Customer to delay commencement of the provision of the Services; or

(iv)

the suspension of the Service in accordance with Clause 4.5 of this Agreement.

4.1.2

For the avoidance of doubt and without prejudice to the Customer’s obligation to pay the Service Charges the Company shall not commence provision of the Service until the Customer has met all applicable payment obligations in accordance with Clause 6 and Schedule Two.

4.2 Changes to the Satellite and Transponder

4.2.1

The Parties acknowledge that the Satellite on which the Digital Capacity is made available may be changed by the Satellite Provider to another Satellite at the same orbital slot from time to time, and in such event the Company undertakes to use its reasonable endeavours to minimise any disruption to the Service.

4.2.2

The Parties acknowledge that the Transponder on which the Digital Capacity is made available may be changed by the Satellite Provider to another Transponder on the Satellite from time to time, and in such event the Company undertakes to use its reasonable endeavours to minimise any disruption to the Service.

4.2.3

The Company may change the Satellite and/or Transponder on which the Digital Capacity is provided to any Satellite or Transponder providing DTH reception in the Territory at any time, provided that any such change does not have a material adverse effect on the provision of the Service which the

Company shall continue to provide in accordance with the Service Description set out in Schedule One.

4.2.4

In the event that the Satellite Provider changes the Satellite and/or the Transponder in accordance with Clause 4.2.1 or 4.2.2 the Company shall not in any event be held liable for any loss or damage arising out of or caused by such variation unless and to the extent that the Company can recover compensation for such loss or damage from the Satellite provider. The Company shall pay any compensation recovered from the Satellite Provider to the Customer as soon as reasonably practicable after the Company receives any such compensation.

4.2.5

The Company shall give the Customer as much notice as possible of any changes to be made in accordance with this Clause 4.2.

4.3 Changes to the Service

4.3.1

The Company may change the Uplink Site to any other teleport at any time, provided that any such change shall not have a material adverse effect on the provision of the Service which the Company shall continue to provide in accordance with the Service Description set out in Schedule One.

4.3.2

The Company agrees to use all reasonable endeavours to provide to the Customer such further services as the Customer may reasonably request from time to time during the Term provided that all requests from the Customer for services additional to the Service or requests for a change to the Service requested by the Customer (a “Change”) shall be made in accordance with the following procedure:

(i)

The Customer will provide the Company with a written request detailing the precise scope of the Change required and the person within the Customer’s undertaking to whom all correspondence in respect of the Change must be addressed (the "Change Representative").

(ii)

The Company will provide the Change Representative with a written report on the proposed Change which will cover feasibility, impact on any time or other schedules contained or referred to in this Agreement, the Clauses, the Schedules, resource requirements and/or any cost effects (the “Change Report”).

(iii)

The Change Representative will consider the Change Report and will notify the Company in writing, within ten (10) Working Days of receipt of the Change Report of the Customer’s decision whether or not to request the Company to proceed with the Change.

(iv)

If the Parties agree that the proposed Change is acceptable the Parties shall use their reasonable endeavours to carry out the Change. In the event that either party decides not to proceed, it will give written notice of its decision to the other party within fifteen (15) Working Days following consideration of the Change Report.

(v)

The Company reserves the right to charge reasonable costs for preparing the Change Report at a rate to be agreed between the Parties in the event that the Customer submits more than six (6) Change Requests in any Year.

4.3.3

The Company may propose a Change in accordance with the procedure

detailed in Clause 4.3.2 above adapted mutatis mutandis to refer to the Company in place of the Customer save that:

(i)

The Company will provide the Customer with both a Change Request and Change Report.

(ii)

The Customer will consider the Change Request and Change Report and will notify the Company in writing within ten (10) Working Days of receipt of the Change Report of the Customer’s decision whether or not it agrees to the Change.

(iii)

If the Parties agree the proposed Change is acceptable the Parties shall use their reasonable endeavours to carry out the Change.

4.3.4

No additions, modifications or alterations to the Service will be valid unless such modifications or alterations are in writing and signed by a duly authorised representative of each party.

4.3.5

The Customer will be provided with the Digital Capacity as outlined in Schedule One. From the Service Commencement Date the Company shall provide 2.5Mbit/s of Digital Capacity to the Customer for no charge until the 17th October 2011. After the 17th October 2011 this Digital Capacity will be provided by the Company on a pre-emptible basis (“the Pre-emptible Digital Capacity”). Should the Company require such Pre-emptible Digital Capacity for another customer then the Company will provide the Customer with fifteen (15) Working Days prior written notice of such requirement (the “Notice Period”). During this Notice Period the Customer may elect in writing to continue to use such Pre-emptible Digital Capacity and in that event from the end of the Notice Period the Service Charge shall increase in accordance with Schedule Two from the day immediately following the expiration of the Notice Period. If the Customer fails to elect in writing within the Notice Period to continue to use the Pre-emptible Digital Capacity the Company will cease to supply such after the expiration of the Notice Period.

4.3.6

In the first Year of the Contract and subject to availability the Customer shall upon 30 days written notice have a right to purchase up to 3Mbit/s additional Digital Capacity at a charge of ***** per Mbit/s per annum for the remainder of the Term.

4.4 Use of the Service

4.4.1

The Customer will ensure that the Service is used in accordance with such reasonable operating instructions as may be notified in writing or orally (and subsequently confirmed in writing) to the Customer by the Company from time to time and in accordance with all applicable laws and regulations.

4.4.2

The Service shall only be used by the Customer for the purposes set out in this Agreement.

4.4.3 Inadvertent Overspill

The Customer acknowledges that the permitted use of the Services provided by the Company pursuant to this Agreement is the transmission of Content within the Territory.

The Customer further acknowledges that the footprint of the Satellite is wider than the Territory and that accordingly the Services can be viewed outside the Territory.

It is the Customer's responsibility to ensure that it has obtained the necessary rights to broadcast the Content and in the event that a third party claim is brought for any of the reasons stated in Clause 9.2 in relation to Content which is viewed outside the Territory the Customer shall fully indemnify the Company as specified in Clause 5.6 in relation to any such third party claims.

4.5 Suspension of the Service

4.5.1

The Company may suspend the Service immediately if and for so long as:

(i)

the Customer has failed to pay the Company any Service Charge or any other sum due under this Agreement in full without set off or deduction by its due payment date and such default has not been remedied within five (5) days of the date of issue of a written notice from the Company requesting immediate payment of the overdue amount; or

(ii)

the Customer is in material breach of any of its obligations under this Agreement and has failed to remedy such breach within fourteen (14) days of the date of issue of a written notice from the Company stating the breach and the remedy required; or

(iii)

the Customer is in breach of its obligations under Clause 9.2; or

(iv)

the Company is required or requested to cease or suspend provision of the Service by the Satellite Provider; or

(v)

the Company is obliged to comply with an order, regulation, instruction or request of the Government of the United Kingdom or an agency thereof, an emergency services organisation, or other competent international satellite organisation or administrative authority which necessitates such suspension; or

(vi)

the Company is reasonably of the opinion that any act or default of the Customer or its agents is likely to cause damage to the Uplink Site the Satellite or any other use of the Satellite.

4.5.2

For the avoidance of doubt, the Customer shall continue to be liable to pay the Service Charges during any period during which the Company has suspended the provision of the Service pursuant to this Clause 4.5.1. If the Company exercises its rights of suspension pursuant to this Clause 4.5.1, it will not operate as a waiver of any right that either party is entitled to under this Agreement or by law.

4.5.3

If and to the extent that the Company exercises its right of suspension under Clause 4.5.1 above this will not exclude the Company’s right to terminate this Agreement in accordance with its terms in respect of a breach which has not been remedied or any other event, nor will it prevent the Company from claiming damages from the Customer for breach of this Agreement.

4.6 Planned Interruptions

4.6.1

The Company provides equipment and operational systems to industry standard levels of redundancy and contingency. However during the Service Period occasional interruptions of Service to the Customer may be required for repairs to or maintenance, testing or improvement of the systems operated by the Company and/or the Satellite Provider (“Planned Interruptions”). The Company shall, wherever possible give the Customer at least forty eight (48) hours notice of any such Planned Interruption and shall use its reasonable endeavours to minimise any disruption of the Service.

4.6.2

The Company shall not in any event be held liable for any loss or damage arising out of or caused by any Planned Interruptions caused or requested by the Satellite Provider unless and to the extent that the Company can recover compensation for such loss or damage from the Satellite Provider. The Company shall pay any compensation recovered from the Satellite Provider to the Customer as soon as reasonably practicable after the Company receives any such compensation.

5. INTELLECTUAL PROPERTY RIGHTS AND INDEMNITY

5.1

If in the course of or as a result of the Company providing the Service to the Customer any of the Company’s employees or agents create any document or other material protected by copyright or other intellectual property right (for example a breakdown slate) (the “Created Works”), it is agreed that all legal and beneficial rights in the Created Works will vest in and be owned by the Company, and Customer will have no rights in it beyond a non-exclusive licence to make copies for internal use of any document (but not other material) for the purpose of receiving the Services for the Term. The Customer and the Company (e.g. regarding grant of licence) will duly execute any assignment or other instrument, which may be necessary to give effect to this provision. However, should the Company create any promotional showreel using any materials provided by Customer, the copyright in those materials will remain with the Customer and the Company will seek the Customer’s permission in order to use and broadcast the materials in their promotional showreel.

5.2

The Company shall indemnify the Customer and hold the Customer harmless against all claims liabilities, actions, losses judgments, payments made in settlement, costs (including legal fees) proceedings, and demands of claims from third parties arising from infringement (or alleged infringement) of any patent, design or copyright or other intellectual property right enforceable in the United Kingdom or any other place, arising out of the Created Works or the Company’s use of the Company Equipment to provide the Services.

5.3

The Customer shall notify the Company promptly in writing of any allegation of infringement and any claim (actual or threatened) or action which may give rise to the Company’s obligation to indemnify the Customer. The Customer shall not make any admission relating to the allegation and shall not settle any such claim or action without the prior written consent of the Company, which consent shall not be unreasonably withheld, delayed or conditioned. The Customer shall allow the Company to conduct all negotiations and proceedings and at the Company’s cost give the Company all reasonable assistance and information in the defence of any such allegation claim or action.

5.4

If at any time an allegation of infringement of patent, design, or copyright is made, the Company may at its own expense modify the DVB Uplink Equipment supplied by the Company so as to avoid the infringement or may replace such items with non-infringing equipment, provided that such replacement items do not prevent the Customer from receiving the signal or receiving the Services.

5.5

The Company shall not acquire or be deemed to acquire any legal or beneficial right in the Content due to or arising out of its provision of the Service pursuant to this Agreement. The Customer shall indemnify the Company and the Satellite Provider and hold the Company and the Satellite Provider harmless against all claims liabilities, actions, losses judgments, payments made in settlement, costs (including legal fees) proceedings and demands of claims from third parties including the Company’s other customers arising from infringement (or alleged infringement) of any patent, design or copyright or other intellectual property right enforceable in the United Kingdom or any other place, by reason of the Company’s use or possession of the Customer Equipment and/or the use, storage or transmission of the Content.

5.6

The Customer shall indemnify the Company and hold the Company harmless from and against any claims incurred by the Company resulting from or arising out of any material breach of the Customer’s obligations in Clause 3 or any breach of the warranties in Clause 9 of this Agreement and in the event that the use or installation of the Customer Equipment at the Uplink Site causes loss or damage to the Company’s property, the Company’s Equipment or any of the Company’s customers’ equipment the Customer shall fully indemnify the Company and/or its customer as the case may be in relation to such loss or damage.

5.7

The Company shall notify the Customer promptly in writing of any allegation of infringement and any claim (actual or threatened) or action which may give rise to the Customer's obligation to indemnify the Company. The Company shall not make any admission relating to the allegation and shall not settle any such claim or action without the prior written consent of the Customer, which consent shall not be unreasonably withheld or delayed. The Company shall allow the Customer to conduct all negotiations and proceedings and at the Customer’s cost give the Customer all reasonable assistance and information in the defence of any such allegation claim or action.

5.8	If at any time an allegation of infringement of patent, design, or copyright is made, the Customer may at its own expense modify the Customer Equipment so as to avoid the infringement or may replace such items with non-infringing equipment.

5.9	The indemnity in Clause 5.2 does not apply to the extent that infringement is caused by the Customer’s use of the Service for a purpose not permitted by this Agreement with other apparatus not supplied by the Customer.

5.10	The indemnification obligations stated in this Clause 5 shall survive termination of this Agreement.

6. SERVICE CHARGES AND PAYMENT

6.1	The Customer shall pay the Service Charges at the rates, times and

frequencies and in the currency as specified in Schedule Two in the manner specified in this Clause 6.

6.2

Not used.

6.3

All Service Charges due under this Agreement shall be payable within fourteen (14) days of the date of the relevant invoice (the “Due Date”) and will be paid in full without any set-off, deduction or withholding of any kind. The Company may charge daily interest on any outstanding amounts from the Due Date until payment is received in full at a rate equal to 2% per cent per annum above the base rate of National Westminster Bank Plc as current from time to time whether before or after judgment. In addition the Company may suspend the Service until all Service Charges have been paid in full pursuant to Clause 4.5.1.

6.4	The Company will not charge interest pursuant to Clause 6.3 above on an invoiced amount if the Customer disputes an invoice in good faith provided that the Customer does all of the following:

(a)

pays all undisputed amounts on the invoice when they are otherwise due; and

(b)

notifies the Company in writing that the invoice is under dispute stating the reason and the amount which is disputed prior to the date when payment would otherwise be due; and

(c)

co-operates with the Company to promptly resolve the dispute; and

(d)

pays the agreed upon portion of the disputed amount within ten (10) days of resolution of the dispute.

6.5	All Service Charges are exclusive of Value Added Tax and any other applicable taxes which may from time to time be levied at the rates and in the manner specified by prevailing legislation.

6.6	The Company may set off sums due from the Company to the Customer under any agreement (without prejudice to any other rights or remedies) against sums due from the Customer to the Company under this Agreement or any other agreement.

7. SERVICE CREDITS

7.1	The Customer shall be entitled to claim Service Credits in accordance with this Clause 7 for any period of time during the Service Period during which there is either a Total Service Interruption or Partial Service Interruption as defined in Clause 8.

7.2	The period of time for which the Customer shall be entitled to claim Service Credits under this Clause 7 shall be equal to the duration of the either the Total Service Interruption or Partial Service Interruption as the case may be.

7.3	The Customer’s entitlement to Service Credits shall be calculated as follows:

7.3.1.

In the event of a Total Service Interruption:

Credit = (ACS / Number of minutes of Service contracted for that year) x QPF

7.3.2.

In the event of Partial Service Interruption:

Credit =

(ACS / Number of Channels) / (Number of minutes of Service contracted for that year)

x QPF x Number of Channels affected

Where ACS is the applicable annual Service Charge payable under the Agreement and QPF is the duration of the qualifying period of Service Interruption in minutes.

7.4

The Company shall give the Customer an allowance equal to the appropriate Service Credit calculated in accordance with Clause 7.3 above against the Service Charges which would have otherwise been due from the Customer for the future use of the Service or a cash refund equal to the appropriate Service Credit if and to the extent that Service Charges due under this Agreement for such future use of the Service are less than the amount of the Service Credit due.

7.5	For the purpose of calculating the aggregate monthly duration of Service Interruptions only those Service Interruptions notified by and agreed with the Company shall be applicable.

8. SERVICE INTERRUPTIONS

8.1	For the purposes of this Agreement, a “Total Service Interruption” shall be deemed to have occurred in the event of any of the following:

(i)

loss of vision signals on all of the Channels; or

(ii)

loss of audio signal on all of the Channels; or

(iii)

degradation in quality of either of the above such that in the reasonable opinion of both Parties, the quality no longer meets the standards normally expected for a service of this type on all of the Channels;

a “Partial Service Interruption” shall be deemed to have occurred in the event of any of the following:

(i)

loss of vision signals on some but not all of the Channels; or

(ii)

loss of audio signal on some but not all of the Channels; or

(iii)

provided always that the Total or Partial Service Interruption exists for at least the period specified below:

(i)

a single Service Interruption exists for more than ten (10) minutes; or

(ii)

the aggregate of all Service Interruptions of less than ten (10) minutes but more than two (2) minutes exceeds thirty (30) minutes in any month; or

(iii)

six (6) or more Service Interruptions of less than two (2) minutes occur in a fifteen (15) minute period.

8.2 Duration of Service Interruption

8.2.1

The duration of a Total or Partial Service Interruption shall be calculated as follows:

(i)

the Service Interruption shall begin from the time at which according to the Company operational log such interruption commenced; and

(ii)

the Service Interruption shall end when the Service has been restored and the Company so notifies the Customer

8.2.2

For the purposes of calculating the Customer’s entitlement to claim Service Credits for Total or Partial Service Interruptions the following shall apply:

(i)

where the duration of a single Total or Partial Service Interruption is fifteen (15) minutes or greater, then the duration of the Service Interruption in respect of which the Customer may claim Service Credits shall equal the duration of the Total or Partial Service Interruption;

(ii)

where a number of Total or Partial Service Interruptions of between two (2) and fifteen (15) minutes are aggregated so as to constitute a Service Interruption, then the duration of the Service Interruption in respect of which the Customer may claim Service Credits shall equal the aggregated duration of all such Total or Partial Service Interruptions;

(iii)

where six (6) or more Total or Partial Service Interruptions each of less than two (2) minutes duration occur within a fifteen (15) minute period so as to constitute a Service Interruption, then the duration of the Service Interruption in respect of which the Customer may claim Service Credits shall be measured from the commencement of the first such Service Interruption until the end of the last Service Interruption.

8.3 Exclusions

8.3.1

Interruptions to the Service which occur due to any of the reasons set out below shall not constitute Service Interruptions and accordingly the duration of any such interruptions shall be discounted from any calculations regarding the availability of the Service and the Company shall have no liability to pay and the Customer shall not be entitled to claim Service Credits for any interruptions which do not constitute Service Interruptions:

(i)

(ii)

the Satellite Provider or the Government of Luxembourg revoking any necessary approval for the provision of the Service or suspending the Service due to circumstances not caused by any act or omission of

the Company; or

(iii)

the Satellite Provider suspending the Digital Capacity for routine testing, repair or maintenance of the Satellite; or

(iv)

suspensions of the Service pursuant to Clause 4.5; or

(v)

any termination of the Service pursuant to Clause 12 or otherwise (not caused by any act of omission of the Company); or

(vi)

any failure due to breach or omission by the Customer of its obligations under this Agreement; or

(vii)

Planned Interruptions to the Service in accordance with Clause 4.6 up to a maximum of one (1) hour per Year, any Planned Interruptions greater than one (1) hour per Year shall be credit events for the purpose of Clause 7 save for those Planned Interruptions caused by the Satellite Provider; or

(viii)

any failure due to termination or suspension of the Supply Agreement not caused by any act or omission of the Company; or

(ix)

any failure due to force majeure as described in Clause 16.

8.4	Without prejudice to the provisions of Clause 4.5 (suspension) the Company’s liability for Service Interruptions shall be limited exclusively to granting Service Credits or repayments as provided in Clause 7.

9.	WARRANTIES

9.1	The Company warrants and undertakes to the Customer that for the duration of the Service Period, it shall:

(i)

comply with all instructions issued by the Satellite Provider that relate to the performance of the Service; and

(ii)

provide the Service with reasonable skill and care.

9.2	The Customer warrants, and undertakes to the Company that for the duration of the Service Period:

(i)

it has the right to transmit the Content; and

(ii)

it shall ensure that the Content does not contain any material which is defamatory, seditious, blasphemous or which constitutes an injurious falsehood or slander of title or any tort or contempt of court or breach of parliamentary privilege and will not invade the privacy of any person; and

(iii)

the transmission of the Service and the Content will not infringe the intellectual property rights or any other proprietary rights of any third party; and

(iv)

it shall not include in the Content any material which causes a breach of the rules of OFCOM; and

(v)

it shall make the Company aware of any notices it receives from any other party including but not limited to OFCOM or any relevant regulatory body within the Territory in respect of a revocation of the

licences held by Customer in respect of the Channel as soon as reasonably practicable following its receipt of such notice

9.3	The Company and the Customer each represents and warrants to the other that:

(i)

it has the right, power and authority to enter into and perform its obligations under this Agreement; and

(ii)

it has full capacity and authority and has obtained all necessary consents (including but not limited to, where its procedures so require, the consent of its Parent Company) to enter into and to perform this Agreement and that this Agreement is executed by a duly authorised representative; and

(iii)

the fulfilment of its obligations hereunder will not constitute a material violation of any existing applicable law, rule, regulation or order of any governmental authority; and

(iv)

all material and necessary or appropriate governmental, public or private consents, permissions, agreements, licences or authorisations to which it is subject have been or will be obtained prior to the Service Commencement Date; and

(v)

the execution, delivery and performance of this Agreement shall not violate or conflict with;

any provision of the by-laws, articles of incorporation or other similar statutory instrument of either party; or

any law, judgment or order applicable to either party; or

any material agreement, restriction or obligation to which either party is subject or which constitutes a default under any such agreement, restriction or obligation.

10. LIABILITY

10.1	Both Parties accept liability for death or personal injury resulting from its own negligence or that of its employees, sub-contractors or agents or for proven fraud of the relevant party or of its employees or agents acting in the course of their duties.

10.2

The Company warrants that it will provide the Service to the Customer in accordance with the terms of this Agreement. All other conditions, warranties, terms, undertakings and obligations express or implied by statute (including, without limitation, those of satisfactory quality or of fitness for a particular purpose (even if that purpose is made known expressly or by implication to the Company), common law, custom, trade usage or otherwise and all liabilities (if any) are excluded.

10.3

The Company does not represent that it will provide the Service free from Service Interruptions during the Term. The Company will be responsible as described in this Agreement if a Service is not provided in accordance with the terms of this Agreement. The Company’s only obligation and the Customer’s only remedy in the event of a Service Interruption will be the right

to claim Service Credits pursuant to Clause 7 and the right to Terminate the Agreement pursuant to Clause 12.7.

10.4	Neither party shall be liable to the other party in contract, tort (including negligence) or otherwise for any:

(a)

loss of business; loss of data; loss of profits; loss of goodwill; loss of anticipated savings even when advised of the possibility; loss of revenue or;

(b)

any indirect or consequential losses, liabilities or costs.

10.5	Subject to Clause 10.6 and 10.7 below both Parties accept liability in respect of damage to the other’s tangible property resulting from its or its employees' negligence up to an aggregate of *****.

10.6.

The Company’s liability in relation to Customer Equipment shall be limited to instances where damage is directly caused due to the Company’s negligence or wilful default up to a maximum aggregate liability per incident of *****. In all other circumstances the Company shall not accept liability for damage caused to or by Customer Equipment.

10.7	The Company’s liability in relation to Company Equipment located at the Interface Point is limited to ***** in aggregate. The Company shall not be liable for damage caused by the Company Equipment to the Customer’s buildings or property irrespective of how such damage is caused.

10.8	Other than in respect of Clauses 10.1, 10.4, 10.5, 10.6 and 10.7, Either Party’s maximum aggregate liability in contract, tort, negligence or otherwise arising out of, or in connection with, this Agreement will be limited in aggregate to the greater of:

(a)

*****; or

(b)

the value of the Service Charges paid by the Customer in the twelve (12) months preceding the incident which gave rise to the claim under this Agreement.

10.9	Notwithstanding the foregoing, nothing in this Clause 10 shall restrict or limit the Customer’s liability under Clause 5.

11. DATA PROTECTION

Both Parties shall comply with the Data Protection Act 1998 and, where processing personal data on the other party’s behalf, shall process such data strictly in accordance with such other party’s instructions and put such operational and technological processes in place to safeguard against any unauthorised access, loss, destruction, theft, use or disclosure of the data.

12. TERMINATION

12.1	If either party:

(i)

being a company, has a petition presented for its winding up (which is not dismissed within fourteen (14) days of its service) or has a meeting convened to consider a resolution that it be wound up or such

a resolution is passed (other than solely for solvent amalgamation or reconstruction) or has a petition presented for the appointment of an administrator or has a receiver or administrative receiver appointed over it or any of its assets or makes any proposal for a voluntary arrangement or any other composition scheme or arrangement with, or assignment for the benefit of, its creditors or is or becomes insolvent within the meaning of s123 Insolvency Act 1986; or

(ii)

being an individual (or if a firm or partnership, any of its partners or members), has a petition presented for his bankruptcy, or has a receiver appointed over his affairs, or makes any voluntary arrangement with his creditors or (in the case of a firm or partnership) proposes or has presented against it a petition for its dissolution; or

(iii)

in either case undergoes any analogous event in any jurisdiction where it is domiciled,

then the other party may terminate this Agreement by written notice to the other taking immediate effect.

12.2

The Customer acknowledges that the Company has entered into the Supply Agreement with the Satellite Provider under which the Satellite Provider has agreed to provide the Company with access to the Digital Capacity for the purposes of providing the Service to the Customer. The Customer further acknowledges that the Company’s use of the Digital Capacity thereunder is subject at all times to the continuing approval of both the Satellite Provider and the Government of Luxembourg. The Customer therefore agrees that if any such approval is revoked or withheld by the Satellite Provider or the Government of Luxembourg for any reason so that the Company can no longer access and use the Digital Capacity to provide the Service to the Customer, then this Agreement shall terminate automatically and the Company and the Customer shall be discharged from all further obligations to each other with effect from the date of such termination.

12.3

Either party shall be entitled to terminate this Agreement at any time in the event of the other party being in material breach of any term of this Agreement and, if such breach is capable of remedy, failing to remedy such breach within thirty (30) days of receiving written notice from the non-breaching party that refers to this Clause 12.3 and specifies the breach and the remedial action required.

12.4	This Agreement shall terminate at the end of the Service Period unless either party terminates prior to that date pursuant to a provision of this Agreement.

12.5	The Company may terminate this Agreement without liability in the event that the Satellite Provider terminates the Supply Agreement provided that such termination is not caused by any act or omission of the Company.

12.6

The Company may, upon giving the Customer at least ninety (90) days prior written notice, terminate this Agreement on 31 March 2013 and/or 30 September 2013 in respect of all Services other than the Fibre Services without liability in the event that the Supply Agreement is terminated for any reason.

12.7	The Customer may terminate this Agreement:

(i)

immediately in the event that a single Service Interruption exists for more than forty eight (48) hours;

(ii)

if the aggregate of all Service Interruptions of more than thirty (30) minutes exceeds twenty four (24) hours in any month.

12.8

The Customer may terminate this Agreement upon written notice after thirty (30) days in the event that in accordance with Clauses 4.2.1 or 4.2.2 a change is made by the Satellite Provider to the Satellite or Transponder on which the Digital Capacity is made available and such change has a material adverse effect on the provision of the Service

13. CONSEQUENCES OF TERMINATION

13.1	Upon termination of this Agreement for any reason the Customer will immediately cease to use the Service.

13.2

If the Service is terminated by the Company pursuant to Clauses 12.1 or 12.3 or by the Customer other than in accordance with Clause 12 all of the Service Charges that would have become due from the Customer pursuant to this Agreement if the Service had not been so terminated shall become immediately due and payable by the Customer, less an allowance for accelerated payment of five (5) per cent per annum. Such payment will be made by the Customer by way of liquidated and ascertained damages and the amount of such payment is accepted by the Parties as being a genuine pre-estimate of the net losses likely to be suffered by the Company in the event of the Agreement being so terminated.

13.3	On termination of this Agreement for any reason,

(a)

any sums due to the Company shall become immediately payable by the Customer without set-off or deduction;

(b)

the Company shall provide the Customer with:

(i)

a refund for any outstanding Service Credits allowed pursuant to Clause 7; and

(ii)

a refund of any Service Charges paid in advance by the Customer under Schedule Two for periods after the termination date of this Agreement during which Service will no longer be provided,

less any sums due from the Customer to the Company; and

(c)

either party shall at its cost immediately deliver up any property belonging to the other party which it has no contractual right to retain.

13.4	The provisions of this Agreement which either expressly or by implication have effect after the termination of this Agreement shall continue to be enforceable by the Parties notwithstanding such termination.

14. CONFIDENTIALITY

14.1

"Confidential Information" means information disclosed by one party (the "Disclosing Party") to the other (the "Receiving Party") to the extent that such information is designated as such by the Disclosing Party in writing or relates to the Satellite Provider and/or the business affairs, developments, trade secrets, know-how, personnel, customers or suppliers of the Disclosing Party

or such information may reasonably be regarded as the confidential information of the Disclosing Party.

14.2	The Receiving Party undertakes that:

(i)

it (and any person employed or engaged by it in connection with this Agreement in the course of such employment or engagement) shall use Confidential Information of the Disclosing Party only for the purposes of this Agreement and shall not disclose any such Confidential Information to any third party without the prior written consent of the Disclosing Party; and

(ii)

it shall take all necessary precautions to ensure that all Confidential Information is treated as confidential and is not disclosed (save as aforesaid) or used other than for the purposes of this Agreement.

14.3	Neither the Customer nor any person engaged by it whether as an employee, servant, agent or sub-contractor shall use the Confidential Information for the solicitation of business from the Company.

14.4

Each party undertakes to the other to take all such steps as shall from time to time be necessary to ensure compliance with the provisions of Clauses 14.2 and 14.3 by its employees agents consultants and sub-contractors. For the avoidance of doubt, the Receiving Party acknowledges that the Disclosing Party may require and the Receiving Party shall procure undertakings as to confidentiality directly from its employees in terms no less onerous than the terms contained in this Clause 14.

14.5	Neither party shall advertise or publicly announce its involvement in the Agreement without the prior written consent of the other party.

14.6	The Receiving Party may disclose information:

(i)

pursuant to a duty imposed by law or the requirements of a regulatory authority or to obtain or maintain a stock exchange listing but only to the extent so required; and

(ii)

to give proper instructions to any professional adviser under an obligation to keep such Confidential Information confidential.

14.7	Confidential Information shall not include, and the obligations contained in this Clause 14 shall not apply, in respect of information:

(i)

which was in the public domain at the time of disclosure;

(ii)

which, though originally Confidential Information, subsequently falls into the public domain through no fault of the Receiving Party;

(iii)

independently developed by the Receiving Party or its employees or agents where such party can show it has no access to that information as Confidential Information of the Disclosing Party received under this Agreement; or

(iv)

lawfully in the possession of the Receiving Party at the time of receipt which is subsequently lawfully received from a third party not under an obligation of confidentiality to the Disclosing Party in respect of that information.

14.8	Without prejudice to the generality of Clause 14.7 (i)-(iv) above, information

shall not be deemed to be in the public domain by reason only that it is known to only a few of those people to whom it might be of commercial interest and a combination of one or more items of Confidential Information with information in the public domain shall not cause such Confidential Information to be deemed to be in the public domain.

14.9	The obligations contained in this Clause 14 shall continue in force notwithstanding termination of this agreement howsoever occasioned.

15. ASSIGNMENT AND SUBCONTRACTING

15.1	Neither party shall assign any of its rights or other benefits or obligations under this Agreement without the prior written approval of the other party which shall not be unreasonably withheld or delayed.

15.2

The Company may subcontract or delegate the provision of the Service in whole or in part provided the Company obtains the Customer’s consent (which shall not be unreasonably delayed or withheld) in which case the Company shall remain primarily liable to fulfil the obligations which it has accepted pursuant to this Agreement.

16.	FORCE MAJEURE

16.1

Neither party shall be liable for any loss or damage suffered or incurred by the other arising from the other party’s delay or failure to fulfil or otherwise discharge any of its obligations under this Agreement to the extent that such delay or failure is caused by any cause or circumstance beyond its reasonable control including, but not limited to acts of God, inclement weather, fire, flood, drought, lightning, acts of the party’s contractors or suppliers; natural catastrophe; acts of central or local Government or international or national regulatory authority; national emergencies; riots; war; solar disturbances; sun outages; externally caused interference including rain fade; Satellite component failure including failure or interruption of Satellite propulsion, electrical or other common systems; degradation of the Satellite not within the reasonable control of either of the Parties and the withdrawal by the Satellite Provider of access to the Digital Capacity on the Satellite (“the Force Majeure Event”). In the event of any Force Majeure Event, without prejudice to any other remedies available to the Customer, the Customer shall be entitled after thirty (30) days to receive fifty (50%) percent of the Service Credits for any Service Interruption resulting from the Force Majeure Event.

16.2

The party seeking to rely on a Force Majeure Event shall as soon as is reasonably practicable after first becoming aware of the circumstances which gave rise to the Force Majeure Event give full particulars in writing to the other party, including, but not limited to, an estimate as to the length of time the Force Majeure Event may continue and the facts and circumstances giving rise to the Force Majeure Event (the “Force Majeure Notice”) and shall take reasonable steps to mitigate the effect of such Force Majeure Event. If a Force Majeure Event persists for a continuous period of one (1) month, then either party shall have the right to terminate this Agreement forthwith upon written notice to the other, such termination shall be deemed effective on and from the date of issue of the Force Majeure Notice. For the avoidance of doubt the Customer shall pay fifty (50%) of the Service Charges during a Force Majeure Event.

17. NOTICES

17.1

Any notice under or in connection with this Agreement shall be in writing and may be delivered by hand to or sent by first class post or by electronic or facsimile transmission (such electronic or facsimile transmission to be confirmed by letter posted within twelve (12) hours) to the Company Secretary at the address of the receiving party set out in this Agreement or to any other address notified by the relevant party from time to time.

17.2

Any notice addressed as provided in Clause 17.1 shall be deemed to have been given or made on the second Working Day after posting if sent by first class post, upon delivery if delivered by hand and if sent by electronic mail or facsimile transmission on the next Working Day after the date of transmission provided the sender retains a receipt of electronic mail or the facsimile machine produces a report showing successful transmission to the correct facsimile number.

18. WAIVER

18.1	No terms or conditions hereof shall be deemed waived and no breach or default excused unless such waiver or excuse shall be in writing and signed by the issuing party.

19. SEVERANCE

19.1	If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, such invalidity or unenforceability shall not affect the other provisions of this Agreement, which shall remain in full force and effect.

20. NO AGENCY

20.1

The Company, in providing the Services to the Customer, is acting only as an independent contractor. Nothing in this Agreement is intended to or shall operate to create a partnership between the Parties, or to authorise either party to act as an agent for the other. Neither party shall have authority to act in the name or on behalf of or otherwise to bind the other in any way. This includes, but is not limited to, the making of any representation or warranty, the assumption of any obligation or liability and the exercise of any right or power.

21. ENTIRE AGREEMENT

21.1

This Agreement constitutes the entire legal and contractual relationship between the Parties relating to the subject matter of this Agreement and except in the case of any fraudulent misrepresentation made by either party in connection with the subject matter of this Agreement and/or save as may be expressly referred to or referenced in this Agreement, supersedes all prior or contemporaneous agreements or representations, written or oral with respect to this Agreement and its subject matter.

22. DISPUTE RESOLUTION PROCEDURE

22.1	Any question or difference which may arise concerning the construction meaning or effect or any matter which arises out of or in connection with this

Agreement shall in the first instance be referred to the nominated representatives of the Company and the Customer for discussion and resolution at a meeting convened for that purpose. The meeting shall take place as soon as reasonably possible and, in any event, within twenty one (21) days of such referral. If the matter is not resolved at this meeting, the escalation will continue though two (2) more levels of management as soon as reasonably possible and, in any event, within a further twenty one (21) days. If the unresolved matter is having a serious effect on the performance of this Agreement the Parties will use reasonable endeavours to reduce the time for completion of the process.

22.2

Neither party may initiate any legal action until this process has been completed, unless such party has reasonable cause to do so to avoid damage to its business or to protect or preserve any right of action it may have, including without limitation to seek injunctive relief in respect of any breach of its intellectual property rights or similar proprietary rights.

22.3	If the dispute is not resolved by escalation in accordance with Clause 22.1 above either party may seek resolution of the dispute through the courts in accordance with Clause 24.

23. VARIATION

23.1	No variation of this Agreement shall be valid unless it is in writing and signed by or on behalf of both Parties.

24. LAW AND JURISDICTION

24.1	This Agreement shall be governed by and construed and interpreted in accordance with English law and without prejudice to Clause 22 (dispute resolution procedure) the Parties hereby submit to the exclusive jurisdiction of the English courts.

25. CONTRACT (RIGHTS OF THIRD PARTIES) ACT 1999

25.1	A person or body who is not a party to this Agreement has no rights under the Contracts (Rights of Third Parties) Act 1999 to rely upon or enforce any terms of this Agreement but this does not affect any rights or remedies of a third party which exist or are available apart from that Act.

26. CUMULATIVE REMEDIES

26.1	The rights and remedies of the Company under this Agreement are cumulative and without prejudice and in addition to any rights or remedies which the Company may have at law or in equity.

AS WITNESS the hands of the Parties the day and year first before written

Signed for and on behalf of ARQIVA LIMITED by

Signed:	/s/ N. Thompson

Print Name:	N. Thompson

Title:	Divisional MD

Date:	29/3/10


Signed for and on behalf of ARQIVA LIMITED by


Signed:	/s/ Julian M. Portman

Print Name:	J. M. Portman

Title:	Divisional FD

Date:	23/3/10


Signed for and on behalf of PLAYBOY TV UK/BENELUX LIMITED by:


Signed:	/s/ Andrew D. Wren

Print Name:	Andrew D. Wren

Title:	Company Secretary

Date:	17 March 2010

SCHEDULE ONE

SERVICE DESCRIPTION

1. SERVICE OVERVIEW

1.1 General

The Company will supply Customer with;

1.1.1

Connectivity services in accordance with Schedule Five.

1.1.2

Digital encoding, multiplexing, adaptation services, for up to 14 television channels.

1.1.3

Uplink of the Channels to the Transponder to meet the requirements of Schedule Six.

1.2 Digital Capacity

19Mbit/s

2. TERM

Service Commencement Date:	17/10/2009

Service Termination Date:	16/10/2014

The Service will be made available to the Customer 24 hours per day, seven days per week during the Service Period.

3. SERVICE DESCRIPTION – KEY ELEMENTS

The Company shall not carry out OFCOM compliance recording.

The following Service elements shall be provided by the Company to Customer;

3.1	The Company will install, maintain and operate the Company Compression System at the Customer Premises and the interface with the Connectivity Service

Equipment

The Company Compression System will consist of the equipment shown in the table below.

Equipment	Number	Manufacturer

Encoders	16	Tandberg
Multiplexes	2	Tandberg
Input router	1	Panacea
Output router	2	DEV
Monitoring IRD	14	Tandberg
DVB TS Monitor	1	Tandberg

The system will accept the Customer Signals as 14 SDI inputs. These inputs will be compressed using a statistical multiplexing algorithm to a combined rate of 19Mbit/s by a 2 for 14 encoding and a 1+1 multiplex system.

The system will include a manual patch panel for use in restoring the service in the event of failure of routers or switchers.

The 19Mbit/s multiplex will be sent over channel [0] on circuit [ ] for onward transmission and uplink to the Eurobird satellite as further detailed.

In addition two (2) Mediasphere servers already installed at the Customer Premises shall be integrated with the Company Compression System.

Installation and Commissioning

The Company will manage the installation of the multiplex system to ensure it is delivered in a high quality and timely manner. We will appoint a project manager to act as the interface with the Customer during the installation and ensure project milestones are achieved.

The project manager will also work with the Customer to develop the optimal configuration and alignment as set out above for the multiplex and commission the system to that configuration.

Maintenance/Ongoing Support

In the event of any fault with the multiplex the Customer should contact the Company MCR as detailed in Schedule 4.

The Customer will be expected to provide ‘Remote Hands’ support under the direction of MCR staff including:

Power Cycling equipment.

Reading front panels or viewing TV monitor and reporting observations.

Entering commands through front panel controls.

In the event that the Customer requires any changes to the configuration of the multiplex the Company will use all reasonable endeavours to provide on site support as soon as reasonably possible.

3.2	The Company Compression System will Encode 14 TV programme streams with up to two associated stereo audio per stream in compliance with MPEG and DVB-S standards presented in SDI format with embedded audio.

3.3	The Company will multiplex on a statistical basis the above streams into a single DVB multiplex with a total bit rate of 19 Mbit/s.

3.4	The service will be Backhauled as detailed in Schedule Five.

3.5	The service will be multiplexed with other channels and the total 33.79Mbit/s data stream will be Adaptation Multiplexed.

3.6	Addition of DVB-S compliant Reed Solomon and FEC error correction, and QPSK modulation of an RF carrier by the Transport Stream at the Uplink Site.

3.7	Upconversion, amplification and uplink of the RF carrier to the Satellite.

3.8	Provision of access to the Digital Capacity to provide the Service.

4. SERVICE DESCRIPTION – ANCILLARY ELEMENTS

4.1 Uplink Management and Control

4.1.1

Monitoring of technical parameters of Service, including BER on the Connectivity and EIRP on the uplink as necessary.

4.1.2

Measurement and logging from time to time of C/N and/or C/No on downlinked signal.

4.1.3

Visual monitoring of all off air programmes within multiplex.

4.1.4

Detailed measurement of vision, audio and data signals as required from time to time.

4.2 Maintenance and Fault Repairs

4.2.1

Faults will be reported to and logged by the MCR. Details of the nature of the fault will be recorded. Fault analysis and engineer call-out will be co-ordinated from the MCR to ensure continuity until the fault is cleared.

4.2.2

Maintenance of the Uplink system is 365 days per year, and all maintenance will be by the Company approved personnel or those of an authorised maintainer.

4.2.3

Where the Company is responsible for a Service outage the Company will issue an incident report. The target time for delivery of the incident report is one (1) Working Day.

5. SERVICE PARAMETERS

5.1 Playout

Not Used

5.2 Encoding, Multiplexing & Adaptation

Encoding of the source signal SDI into a DVB MPEG 2 4:2:0 stream. The stream will then be passed through an adaptation hub to enable the Service to be part of the BSkyB platform.

5.3 Uplink

All parameters will be in compliance with DVB-S parameters and the Satellite Provider’s requirements, and in particular, the details set out in Schedule Six.

5.4 DVB parameters

Multiplexer Transport Stream Rate:		27.032 Mb/s or 33.79 Mb/s(not incl. 204,188 RS padding)
Satellite Inner Coding:		Reed Solomon 188,204 (as per DVB-S standard)
Satellite FEC:		One of the following DVB compliant FEC rates will be applied to the multiplex transport stream ½, 2/3, ¾, 5/6 or 7/8
Satellite Modulation:		QPSK (as per DVB-S standard)
Uplink Symbol Rate:		22 Ms/s or 27.5 Ms/s

SCHEDULE TWO

COMMERCIAL TERMS

1. Payments

Customer shall pay the following Service Charges for the duration of the Service Period:

*****

2. Deposit

*****

3. Payment Schedule

The Service Charge will be payable monthly in advance, with effect from the Service Commencement Date, the amount(s) due being one twelth of the annual Service Charges set out in paragraph 1 above. The Company shall invoice for such charges no later than thirty (30) days in advance of the month to which they relate. The due date for payment by the Customer shall be fourteen (14) days before the start of the month to which the payment relates.

Any sum falling due on a day which is not a Business Day shall be payable on the immediately preceding Business Day.

4. VAT

All sums payable under this Agreement are exclusive of VAT or any other taxes which may be applicable, or become applicable at any time. Any such charges will be payable by the Customer upon receipt of a VAT invoice in due form.

SCHEDULE THREE

THE CUSTOMER EQUIPMENT

None

SCHEDULE FOUR

CONTACT DETAILS

1. THE COMPANY:

Notice Address:

Director of Legal Services

Arqiva Limited

Chalfont Grove

Narcot Lane

Chalfont St Peter

Bucks SL9 8TW

United Kingdom

Bank details:

*****

Contact Details:

*****

2. The Customer:

Notice Address and Billing Address

Aquis House

Station Road

Hayes

Middlesex

UB3 4DX

Customer Contact Details:

Account

Madhurika Walsh

Payments

Tammy Childs

Operational

Ian Nile

SCHEDULE FIVE

THE INTERFACE SPECIFICATION AND CONNECTIVITY

The Customer shall present the Content as follows:

Interface Point:		the Customer Premises

Presentation standard:		conforming to television and video standards ITU-R BT.601 and ITU-R BT.656 and to audio standard AES 3 1992, the audio signals to be embedded. The service to carry one PAL (625/50) video signal and up to two stereo audio signals.

The Company will provide connectivity from the Interface Point to the Company Sites at Chalfont Grove and Newman Street for the delivery of the DVB-ASI signal from the Company Compression System. The signal will be delivered to each site via DS3 fibres.

SCHEDULE SIX

THE SATELLITE AND TRANSPONDER

Company shall provide Digital Capacity for DTH reception in the Territory. Company can at its discretion from time to time use the satellites detailed below.

A. Satellite Details

1. Satellite	:	EUROBIRD
2. Orbital position	:	28.5°East
3. Degree of protection	:	Non-Preemptible
4. Downlink Frequency Band	:	10.70 – 12.75 GHz
5. Uplink Frequency Range	:	12.75 – 14.50 GHz
		17.30 – 18.40 GHz

B. Orbital Position and Transponder Bandwidth

The satellite providing the allotted capacity shall be maintained by the Satellite Provider within ± 0.1 degrees of its nominal longitude position and shall be kept such that the maximum angle between the equatorial plane and the orbital plane shall not exceed ± 0.1 degrees.

C. Satellite Provider

SES

D. Satellite Footprint

Downlink Coverage of EuroBird 1 steerable beam 1

Service may be provided in either of the coverage maps shown below. The Customer should not rely on the information contained in this coverage map. The Company shall not be liable for any damage or loss sustained by the Customer as a result of the Customer’s reliance on this coverage map which is provided for indication only. For the avoidance of doubt, the fixed coverage beam will be used at the outset of the Service.

Steerable Coverage

Fixed Coverage

Service will be provided at a level 5dBW lower than the amounts shown below.

E. Transmit Service Areas

The Company shall provide the Customer Service within a DVB-S compliant carrier using satellite capacity on Eutelsat’s Eurobird 1 satellite located at orbital position 28.5º East (+/- 0.1 degrees). The carrier transmitted by the Satellite will have the following expected minimum down link EIRPs at the following locations, assuming clear sky conditions both at the Uplink antenna and receive dish location. The locations are grouped into 3 zones defined as Transmit Service Areas.

Transmit Service Areas

Minimum EIRP over the Transmit Service Area: 49dBW, over Zone 1.

Zone 1 (49 dBW EIRP transmit)

England, East of 4° West

Scotland, South of 56° North

Wales

Copenhagen (Denmark)

Germany

Zone 2 (45 dBW EIRP transmit)

Minimum EIRP over the Transmit Service Area: 45dBW, over Zone 2.

Brest (France)

Cork (Ireland)

Genoa (Italy)

Zagreb (Croatia)

Cracow (Poland)

Stockholm (Sweden)

Trandheim (Norway)

Zone 3 (38 dBW EIRP transmit)

Minimum EIRP over the Transmit Service Area: 45dBW, over Zone 3.

Porto (Portugal)

Sevilla (Spain)

Barcelona (Spain)

Rome (Italy)

Tirana (Albania)

Lvov (Ukraine)

Vilnius (Lithuania)

Helsinki (Finland)

Kiruna (Sweden)

SCHEDULE SEVEN

ENCODING AND BIT RATE OPTIONS

Not used

SCHEDULE EIGHT

THE INTERACTIVE SERVICE

The Interactive Service will run at a maximum bit rate of 1.5Mbit/s. The Company will provide a service whereby applications delivered to them will be loaded onto an interactive television streamer.

The Customer will be responsible for the delivery of all interactive applications. The Company will only accept open tv files.

Updates to applications will be no more frequent than every 30 seconds.

PLAYBOY ENTERPRISES INC - FORM 10-Q - EX-10.2 - EXHIBIT 10.2 - May 7, 2010

Attached files

PLAYBOY ENTERPRISES INC Reports