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Home My WebLink About1999-230 Agrmt - DCTVDecember 28, 1999 Mr. Michael Ainsworth Cable Television Specialist City of Ashland, Oregon Electric Utilities Fiber Network Division 90 North Mountain Avenue Ashland, Oregon 97520 Personal & Confidential Via Federal Express Dear Mr. Ainsworth: I am pleased to enclose a mutually executed copy of the City of Ashland's Agreement for the launch of our DCTV Service. The effective date of the Agreement is December 28, 1999, when it was signed on behalf of DCTV; however, we cannot implement our DCTV service until we receive the initial equipment payment of $61,480. Please initial Schedule D and fax it to me at (818) 526-5003. Additionally, please fax a copy of your channel line-up (Schedule G) to Ray Pearson in Operations at (818) 526- 5006. Finally, I have reprinted Schedule E to reflect your decision to forego the DMX Music Service as part of your programming. Our operations team will be in touch shortly regarding installation of the digital head-end equipment, on-site training and to schedule the launch of DCTV Service in your System. If you have any questions please contact Steve Schachter. Sincerely, ,,,, Associate Counsel Enclosure cc: Steve Schachter Jennifer Parkis David Sears Craig Turner Laura Spangler-Barton Ray Pearson ¥( s[ A ameda Avenue B )a k (alifomia91505 · 8185265000 Fax:8185265001 · www.[vncom December 7, 1999 Private & Confidential Michael F. Ainsworth Cable Television Specialist City of Ashland, Oregon by and through its Electric Utilities' Fiber Network Division 90 North Mountain Avenue Ashland, OR 97520 DCTV AFFILIATION AGREEMENT Dear Mr. Ainsworth: DCTV, Inc. ("DCT~"), a wholly owned subsidiary of TVN Entertainment Corp. ("TVN"), is pleased to present this letter agreement which sets forth the terms and conditions agreed upon for the City of Ashland, Oregon by and through its Electric Utilities' Fiber Network Division's ("ASHLAND") launch of TVN's turnkey digital pay-per-view ("PPV") programming, transactional and delivery service, TVN Digital Cable Televisions~" ("DCTV Service"), in each cable system listed on a separate Schedule A hereto (each a "System"). 1. DCTV SERVICE PROGRAMMING: Includes TVN Digital Entertainments~" - 32 or more digitally compressed and encrypted channels of PPV movies and special events; DMX®- 40 channels of digital music; TV Guide® Interactive on-screen program guide; the TVN preview/barker channel; and with Spice (or comparable adult programming service) and Playboy Channel digital feeds available. TVN utilizes General Instrument ("G.I.") cable industry standard, interoperable MPEG-2 digital compression and encryption technology ("DCII Technology"), and national access control for authorization of DCTV programming and such other digital programming as ASHLAND may wish to add. ASHLAND must request Spice and/or Playboy Channel service on Schedule E hereto if desired as part of the DCTV Service. TVN will be responsible for playback, digital encoding, encryption and uplink of the PPV movie and event feeds, with movies programmed in a near-video-on-demand ("NVOD") format and transmitted in continuous showings on one or more digital video streams (channels). TVN supplies and schedules its digital signal PPV movies and events and Spice and Playboy Channel digital feeds for C-band satellite delivery from TVN designated transponders, currently on Galaxy IX ("G-9") nos. 7, 9, 10 and 11 (TVN -1, 2, 3 and 4 respectively), and will arrange for authorization of TVN Transponders (TVN 1, 2, 3 and 4) at the System head-end. 2. DCTV TRANSACTIONAL SERVICES: Includes automatic number identification ("ANI") PPV ordering or store and forward impulse PPV ordering ("IPPV"); customer service for DCTV Subscriber sign-ups and TVN PPV movie and event orders; national access control for the digital services; credit card or customer billing for TVN transmitted PPV programming; studio and event licensing, license fee administration, reporting and payment, consistent with each distributor/studio practices; and marketing and management reports. ANI or IPPV is available for DCTVSubscribers to order a TVN PPV movie or event by placing a call to an 800#, or by 1 ~ V¢I '~,i~ar/,oda Avel/u~ B!;~barsP / sflf(~rr, ia 91505 · 818526 5000 Fax: 818.526 5001 · www.tvncom pushing a button on the Digital Set-Top remote control, respectively, as part of the DCTV Service. DCTVor its service agent will poll each Digital Set-Top at regular intervals for IPPV orders placed by that Subscriber, which are stored in the Set-Top memory and then forwarded via modem for billing by DCTV or its billing agent. ASHLAND may select either ANI or IPPV service on Schedule E hereto as part of the DCTV Service. 3. DCTV MARKETING SUPPORT: Includes TVN preview/barker channel; cross-channel video spots; print ad slicks; and such other marketing tactics as ASHLAND may designate on Schedule D and use for marketing the DCTVService. 4. EQUIPMENT AND FINANCING: ASHLAND will purchase (i) the head-end transcoding, modulation and related digital equipment described on Schedule B necessary to receive DCTV Service ("Schedule B Equipment"); (ii) an initial quantity of G.I. DCT-2000 or equivalent DCII interoperable consumer digital set-top converters ("Digital Set-Tops") with companion universal remote controls and additional Digital Set-Tops and remoras as available per purchase orders placed by ASHLAND, consistent with Schedule B hereto, and (iii) the Schedule H-1 Equipment (defined below). ASHLAND will obtain its own third party financing or pay cash for such equipment. DCTVwill make monthly payments to reimburse ASHLAND for the purchase price of the Schedule B Equipment as provided for in Schedule C-2 hereto, DCTV will arrange for ~nstallation of the Schedule B and Schedule H-1 Equipment at the System head-end after it has been prepared by ASHLAND to receive DCTV Service in accordance with DCTV instructions. After the Schedule B and Schedule H-1 Equipment is installed and operable, ASHLAND shall sign and return to DCTVthe Schedule ! Delivery and Acceptance Certificate which certifies that the Schedule B and Schedule H-1 Equipment has been delivered, installed and is operative for DCTV Service. With respect to (i) the Schedule B Equipment, (ii) any additional head-end equipment necessary for reception of the non-DCTV digital programming per paragraph 5 hereof ("Schedule H-1 Equipment"); and (iii) all Digital Set-Tops and remotes, the actual purchase price and head-end configuration therefor is set forth on Schedules H, H-1 and H-2 hereto. All maintenance and repair shall be provided solely by each equipment manufacturer per the terms of its warranties. Neither DCTV nor TVN is or shall be responsible for any warranty or repair of any equipment purchased by ASHLAND for the DCTVService or otherwise, and DCTV hereby expressly disclaims and does not offer or provide any warranties for such equipment for fitness of purpose, merchantability, against infringement or otherwise, whether express, implied or statutory. 5. OTHER DIGITAL PROGRAMMING: ASHLAND may include additional digital programming described on Schedule E that utilizes DCII Technology, including premium pay multiplexes and/or basic channels. ASHLAND will license from and pay license fees to each such programmer, or from DCTV, should it have rights to provide such licenses. Transport for these digital programming services will be received via the programmer's transponders and included in its license fee, or from HITS, which ASHLAND will negotiate separately. DCTVwill provide access control and channel mapping for the additional DCII digital programming services without additional cost, and will assist with head-end set-up and implementation. Schedule G hereto lists the current analog channel line-up of each System subject to this Agreement. ASHLAND will purchase the Schedule H-1 Equipment needed for reception and retransmission of all non-DCTV digital programming. 6. AUTHORIT_.ATION~ BILLING AND FEES: DCTVwill provide national access control/authorization for the DCTV Service, TVN Digital Entertainment PPV movies and events Spice and/or Playboy Channel PPV movies, and other digital programming added by ASHLAND, and arrange for installation of the Schedule B Equipment. ASHLAND personnel will TVN ENTERTAINMENT CORPORATION Wes[ ~Jameda Av6~nLJ¢,, Burbank, C:arifomia 91505 · 818.526 5000 Fax: 818.5265001 · wwwtvn com (i) install a Digita~ Set-Top and remote control for each subscriber who orders DCTV Service ("DCTV Subscriber"), and (ii) activate such Digital Set-Top by calling DCTV's cable affiliate hot- line at the time of installation, to provide the requisite customer installation and authorization data. ASHLAND may charge a monthly fee to DCTV Subscribers for its digital tier of services (including DCTVService) on the monthly cable bill. A monthly service fee for each authorized DCTVSubscriber Digital Set-Top ("DCTVService Fee") will be payable by ASHLAND to DCTV per the attached rate card (Schedules C and C-1), at the end of each month in which DCTV Service is delivered in the System. DCTVwill pay to ASHLAND a share (%) of the Adjusted Gross PPV Movie and Event Revenue billed and received by DCTVduring each month for TVN, Spice, Playboy Channel PPV and Event buys from ASHLAND's DCTVSubscribers ("ASHLAND PPV Fees"), as provided for in Schedule C hereto. TVN PPV movies and Spice and/or Playboy Channel PPV programming will be mutually priced by DCTVand ASHLAND based on the market for each ASHLAND System, and will be charged by DCTVdirectly to DCTVSubscriber credit cards (not on the monthly cable bill). TVN PPV special events will be mutually priced by DCTV and ASHLAND event-by-event, and also charged by DCTV directly to DCTV Subscriber credit cards. DCTVwill provide to ASHLAND a monthly report listing (i) all TVN PPV movie and event buys and Spice and/or Playboy Channel PPV buys from DCTVSubscribers, and (ii) all new DCTV Subscribers and Digital Set-Tops authorized during that month. Concurrently with the report provided to ASHLAND at the end of each month, DCTV will pay the ASHLAND PPV Fees to ASHLAND. 7. AFFILIATE OBLIGATIONS: ASHLAND will (i) prepare its System head-end to receive the DCTVService, (ii) acquire the Schedule B and Schedule H-1 Equipment and Digital Set-Tops as above provided in Section 4, (iii) downlink at each System head-end the DCTVService digital video, audio and data signals transmitted from the designated TVN transponders, (iv) transcode, modulate, retransmit and deliver the DCTV Service to its DCTV Subscribers using the System infrastructure and wire to the home, (v) timely launch, distribute and continualty and actively market, promote and sell the DCTVService, (vi) use the DCTVand TVN Proprietary Marks described in Schedule F, as approved by DCTV, to identify the DCTVService and the TVN Digital Entertainment PPV movie and event service, (vii) timely perform all other contractual obligations hereunder, and (viii) install a Digital Set-Top and companion universal remote control in the home of each DCTV Subscriber, and instruct and train such Subscriber in their proper use and features. If ASHLAND selects and utilizes IPPV Service, each DCTV Subscriber's home telephone line shall be connected to or made interoperable with the Digital Set-Top by ASHLAND's installers at the time of installation, to enable IPPV ordering of TVN Digital Entertainment PPV movies and events. 8. NO OTHER PAY-PER-VIEW SERVICE: During the Term and each Renewal Term, ASHLAND will not, directly or indirectly, offer or provide to its cable subscribers or DCTV Subscribers (i) any other digital PPV movie or special event programming service, or (ii) any other digital multiplex music service or on-screen interactive program guide, however delivered, other than with DCTV's prior written consent and as part of the DCTV Service pursuant to the terms of this Agreement. 9. TERM: The term of this Affiliation Agreement is five (5) years commencing on ASHLAND's consumer launch of DCTV Service ("Term"), and shall automatically be renewed for successive two (2) year terms (each a "Renewal Term"), unless either party terminates this Agreement effective on the last day of the Term or any Renewal Term, by giving ninety (90) days written notice thereof to the other party prior to such expiration. TVN ENTERTAINMENT CORPORATION West AlamedaAver~ue Burbank California 91505 · 8185265000 Fax: 818.5265001 · wwwtvncon~ 10. INITIAL EQUIPMENT PAYMENT AND iNCENTIVES: A one-time-only Initial Equipment Payment will be payable by ASHLAND to DCTVconcurrently herewith per Schedule C-2, and which DCTVwill apply to the purchase price of the Schedule B and Schedule H-1 Equipment. Subscriber penetration based rates are provided for in Schedule C-1 hereto, to provide incentive for potential subscribers to sign-up for DCTV Service. DCTV will be responsible for making payments over the term of this Agreement as will reimburse ASHLAND in sixty (60) equal monthly payments that total $34,075 (plus interest thereon at the rate of 8% per annum) of the purchase price by ASHLAND for the Schedule B equipment. This reimbursement by DCTV to ASHLAND is not tied to penetration levels or the number of subscriber members. 11. DCTV TECHNICAL INFORMATION: DCTVwill provide ASHLAND with technical specifications for (i) transmission of the DCTV Service, (ii) layout of the Schedule B Equipment installed for reception and distribution of the DCTV video, audio and data signals, and (iii) ASHLAND to receive, decode, modulate and retransmit the DC TV signals. During head-end equipment installation and DCTV Service implementation, DCTV will provide mutually agreed on-site technical support and training as required for effective operations. Thereafter, 24 X 7 DC'IV technical support will be available via a dial-in affiliate hot-line. After hours DCTV customer service via 800# phone will be available for DCTV Subscribers regarding sign-ups and TVN PPV movies and events. 12. DCTV SERVICE TRANSMISSION: ASHLAND will monitor the transmission quality of the DCTV Service programming delivered from the System head-end to its DCTV Subscribers, use its best efforts to maintain delivery of high quality video and audio signals, and correct such problems as may arise from its transmission of the DCTV Service. DCTV will be responsible for all costs incurred in uplinking the DCTVsignals to the TVN transponders. ASHLAND will be responsible for all costs incurred in (i) downlinking the DCTVsignals at its System head-end from the TVN transponders accessed, and (ii) utilizing the Schedule B Equipment and the System infrastructure to re-transmit these signals to its DCTV Subscribers. 13. SECURITY MEASURES: ASHLAND shall take commercially reasonable security measures to prevent reception of any DCTV Service by a person or entity who is not an authorized DCTVSubscriber, including such security measures as G.I. may require for head- end security of its DCII Technology. ASHLAND shall not provide any free or discounted DCTV Service to any ASHLAND or DCTVSubscriber, third party or employee, except as may be pre- approved in writing by DCTV, or as part of a promotion for DCTV Service and/or TVN Digital Entertainment PPV service that has been pre-approved in writing by DCTV. ASHLAND will distribute the DCTV Service, TVN PPV movies and events, TVN Preview Channel and Spice and Playboy Charmer programming as transmitted by TVN, without alteration, editing, insertions or delay of any kind, except as may be otherwise expressly permitted in writing by DCTV. Notwithstanding the foregoing, ASHLAND may interrupt its transmission of DCTV Service as required by the FCC for use of its Emergency Broadcast System or as required by applicable law. 14. FAILURE TO PAY FEES - RETRIEVAL OF SET-TOP: If a DCTV Subscriber fails to pay when due (i) the monthly service fee charged by ASHLAND for DCTV Service, or (ii) any TVN Digital Entertainment PPV charges, whether by way of a credit card charge-back or denial, returned check, or otherwise, for two (2) consecutive months after notice of non-payment has been provided, then ASHLAND (i) may, in the case of a non-payment to it, and (ii) shall in the case of such non-payment to DCTV, retrieve and repossess the Digital Set-Top and remote control provided for that Subscriber's use to receive DCTV Service. In the event of a DCTV Subscriber's non-payment of TVN Digital Entertainment PPV charges, or upon TVN ENTERTAINMENT CORPORATION '~()I VVestAlar'~',edaAvenue, Burbani<, California 91505 · 818526.5000 Fax: 8185265001 · wwwtwlcom ASHLAND's written direction to DCTV on a DCTV provided form, DCTV shall deauthorize such Set-Top so it may not be used by the non-paying Subscriber for reception of DCTV Service. Each Digital Set-Top so retrieved and repossessed by ASHLAND shall be re-deployed and placed in service by ASHLAND as soon as feasible for a new DCTVSubscriber. 15. ACCOUNTING PERIODS: DCTV Service Fees are payable by ASHLAND to DCTV no later than thirty (30) days after the end of each month in which DCTVService was rendered in the System. ASHLAND's share of DCTV PPV Fees are (i) payable by DCTVto ASHLAND with respect to each month during the Term hereof, and (ii) due thidy (30) days after the end of the each month. ASHLAND shall provide DCTVwith such tax exemption, re-sale certificates and other similar documents as may be required for each state, local or other jurisdiction in which ASHLAND distributes the DCTV Service hereunder. 16. RESERVATION OF RIGHTS: Except as expressly set forth in this Agreement, ASHLAND acknowledges and agrees that it has, and shall have, no right or interest in (i) any DCTV Service or TVN Digital Entertainment PPV Service (including programming content and related data), (ii) any DCTV proprietary or licensed technology, (iii) any DCTV or TVN Proprietary Marks, or (iv) any other rights or property of DC'iV or TVN, all of which are expressly reserved and shall remain the rights and property of DCTVor TVN, respectively. 17. TERMINATION FOR BREACH OF AGREEMENT: If either party (i) fails to pay any required fees to the other when due, and does not make such payment within three (3) business days after receipt of written notice of such non-payment, or if more than two (2) such payment failures and cures take place within one calendar year, or (ii) breaches any of the material non- payment terms or conditions of this Agreement and fails to cure such breach within a reasonable period, not to exceed thirty (30) days, after receipt of written notice from the other party specifying such breach, then the party giving such notice shall have the right to terminate this Agreement. A default by ASHLAND under its agreement with the Schedule B Equipment financing entity may be deemed by DCTVa material non-payment breach pursuant to paragraph 17 hereof, for which DCTV may terminate this Affiliation Agreement. 18. FORCE MAJEURE: Neither ASHLAND nor DCTV shall have any rights against the other party hereto for the non-operation of facilities (including any satellite or transponder failure) or the failure to deliver the DCTV Service if such non-operation or failure is due to an act of God; unavoidable accident; fire; lockout, strike, or other labor dispute; riot or civil disturbance; act of government or a governmental instrumentality (whether federal, state or local); failure in whole or in part of transmission facilities or equipment; or any other cause beyond such party's commercially reasonable control. 19. LIMITATION OF LIABILITY- INTERRUPTION OF SERVICE. If during any month, as a result of any cause outside of DCTV's or TVN's control, the DCTV Service is interrupted as a result of failure of a function, equipment or facility required to be provided by DCTV hereunder, ASHLAND's sole and exclusive remedy shall be that if ASHLAND reduces the monthly fees payable by DCTVSubscribers for DCTVService because of such failure, the DCTV Service Fees otherwise payable by ASHLAND to DCTV pursuant to this Agreement, with respect to such month, shall be decreased by the same proportion as such reduction bears to the fees which ASHLAND otherwise would have been required to pay to DCTV. In the event DCTVfails to transmit the DC TV Service to ASHLAND for a cumulative 90-day period during any year of the Term hereof, ASHLAND shall have the right to terminate this Agreement, without damages, subject to the continuing confidentiality obligations set forth below. DCTVshall have no liability or responsibility to ASHLAND if a DCTVvendor fails or refuses to provide a service or product TVN ENTERTAINM:~NT CORPORATION ? VVestAlar~edaAwnue, Burbank, California 91505 · 818526.5000 Fax: 818526.5001 · wwwtvncom which is part of, or is necessary for the delivery of, DCTV Service, or if any Schedule B or Schedule H-1 Equipment manufacturer fails to (i) offer a warranty, or (ii) comply with any warranty offered by such equipment manufacturer. In no event shall (i) either party have any liability to the other, whether regarding its obligations hereunder or otherwise, for consequential, exemplary, punitive or incidental damages, including anticipated lost profits, and (ii) DCTV's liability in tort or contract shall never exceed the amount of fees paid by ASHLAND to DCTV hereunder. 20. CONFIDENTIALITY: Ashland is a municipal corporation and their records are subject to public disclosure. Notwithstanding this fact, without the prior written consent of the other, neither ASHLAND nor DCTV shall disclose to any third party (other than its respective employees, in their capacity as such, and who have a need to know in the performance of their ordinary employee functions, or parties with which ASHLAND or DCTV is participating in a joint venture and which have a need to know as part of such joint venture), any information with respect to the terms or provisions of this Agreement, except as required by law. 21. GENERAl_ PROVISIONS: This document contains the entire agreement and understanding of the parties, it supersedes all prior negotiations, agreements and understandings of the parties relating to the subject matter hereof, and it may not be modified except in writing signed by both parties hereto. Any waiver must be in writing and signed by the party whose rights are being waived, and no waiver by either party of any breach or by operation of any provision hereof, shall be, or be deemed to be, a waiver of any subsequent breach of the same or any other provision of this Agreement. The obligations of ASHLAND and DCTV hereunder are subject to applicable federal, state and local laws, rules and regulations. This Agreement, and all disputes, claims or issues regarding performance or termination hereunder shall be governed by and interpreted in accordance with the laws of the State of California, without regard to conflict of law provisions. Any dispute, issue or claim between the parties arising under or related to this Agreement, including, without limitation, its interpretation, performance and/or termination, shall be resolved by arbitration under the Commercial Arbitration Rules of the American Arbitration Association in Burbank, CA. Each party waives its right to a trial by jury for any such dispute, issue or claim. The provisions of this Agreement are for the exclusive benefit of the parties hereto and their assigns and legal successors, and no third party shall be a beneficiary of. or have any rights by virtue of, this Agreement. [This area intentionally left blank.] TVN ENTERTAINIVI~NT CORPORATION 2901 West Alan/edaAvenuer Burbank, California 91505 · 8185265000 Fax: 818.5265001 ° wwwtvn.com This Agreement shall be legally binding and enforceable only after it has been signed on behalf of DCTVat its Burbank, CA. offices. Each mutually signed fax copy may be used for all purposes as an original document. The undersigned signatory for ASHLAND represents that the City of Ashland, Oregon has duly authorized him or her, Dy and through its Electric Utilities Ashland Fiber Network Division, to execute this Agreement on the City's behalf. DCTV, Inc. By: Print Name: Title: .b~? AGREED: CITY OF ASHLAND, OREGON, by and through its ELECTRIC UTILITIES' FIBER NETWORK DIVISION TYN ENTERTAINM~ENT CORPORATION 2901 West A an eda Avenue, Burbank, California 91505 · 818 5265000 Fax: 818.5265001 ° wwwtvn.com SCHEDULE A Cable Affiliate System Profile Cable Operator Name: Ashland Fiber Network Type of entity; if corporation, indicate state of domicile Federal Tax ID # System Name if different: System Address: 90 North Mountain Avenue, Ashland, OR 97520 Contact Names: Corporate: Peter Lovrovich Technical: Tel: 541-488-5357 Tel: Fax: Fax: (Person who will receive Notices hereunder) Parent MSO (if applicable): Total Number of Households Passed: 9,800 Approximate Number of System Subscribers: Basic: Addressable System: Yes: X Total Addressable Homes: # of Channels Scrambled: Which Channels are Scrambled: Current System Bandwidth: 860 Current Channel Capacity: In Use Which PPV Services Are Currently Offered: N/A Richard Holbo 9,300 Open No: Marketing: Mike Ainsworth Tel: 541-552-2316 Fax: 541-488-5320 Premium: Current # of Channels Devoted to Pay-Per-View: N/A Current # of Channels Devoted to Adult Programming: N/A Current Barker/Preview Channel Devoted to Promotion of PPV: Yes: Anticipated Launch Date of DCTV Service: 1/1/00 No: TVN ENTERTAINIVI~ENT CORPORATION ~9ii! West Ala~'qeda Avenue, B~rbank, California 91505 · 816 5265000 Fax: 818 526.5001 · wwwtvn.com SCHEDULE B Digital Equipment DIGITAL EQUIPMENT INSTALLED AT THE SYSTEM HEAD-END FOR RECEPTION/RETRANSMISSION OF DCTV SERVICE: 1. IRT-1000 Units ..................................................................... # 5 2. IRT-2000 Units ..................................................................... # 0 3. C6U Units ............................................................................ # 2 4 OM-1000 Units ...................................................................... # 1 5. Ethernet Hub ......................................................................... # 1 6. Remote Bridge ...................................................................... # 1 7. Rack(s) ............................................................................... # 1 8. Pre-Pack Services ................................................................. # 1 Digital Set-Tops DIGITAL SET-TOPS AND COMPANION REMOTE CONTROLS: 1. Initial Order Digital Set-Tops (multiples of 20) ................................................. #. 100 --Model No.: DCT-2000 Model # ABCDEF Companion Remote Controls (multiples of 10) .............................. # 100 2. Subsequent Order Anticipated (during first 6 months after launch) Digital Set-Tops (multiples of 20) ............................................... # 400 Companion Remote Controls (multiples of 10) ............................. # 400 3. Subsequent Order Anticipated (during second 6 months after launch) Digital Set-Tops (multiples of 20) .............................................. # 600 Companion Remote Controls (multiples of 10) ............................ # 600 TVN ENTERTAINIV~NT CORPORATION West Alameda Avenue, Burbank, California 91505 · 818 5265000 Fax: 818526.5001 · www.tvn.com SCHEDULE C Rate Card ASHLAND's Share of Adjusted Gross PPV Revenue~ ................................................. 60% In the event that ASHLAND's adult programming buy rates exceed 15% in any given reporting month, then ASHLAND's share of the Adjusted Gross Adult Programming Revenue shall be 75% for the buys in excess of the 15% monthly adult programming buy rate (buy rate calculated by dividing the total adult buys by the average digital subscriber count in any given month). DCTV Service Fees Payable by ASHLAND ........... Monthly fee per DCTV Subscriber per Schedule C-1 Initial Equipment Payment .................................... Per Schedule C-2 Adjusted Gross PPV Revenue is the gross revenue received by DOTVfor TVN transmitted pay-per-view movie and event orders, and Spice and/or Playboy Channel PPV orders, from DCTV Subscribers in each System, less (i) the license fees payable by DCTV to film licensors (movie studios) and event distributors for TVN PPV buys, (ii) Subscriber PPV "bad debt", i.e., credit card charge-backs, denials, returned cheeks, and (iii) applicable state and local fees and taxes, including sales tax or equivalents. TVN ENTERTAINIV~NT CORPORATION 7901 West Ala~ne~a ~O~'rii~.. Burbar~k California 91505 · 818526.5000 Fax: 818.526.5001 · wwwtvn.com ;> TVN ENTERTAINMENT CORPORATION :'901 Wes~Aia~eda A~er~ue Bu:banb Ca!iforn~a 91505 * 818526.5000 Fax: 818526.5001 ,, wwwtvncom TVN ENTERTAINMENT CORPORATION :;!01 VVest Aar~eda Aver, u(: ~u-bar!k C~]l,forma 91505 · 8185265000 Fax: 818526.5001 · wwwtvncom SCHEDULE D Marketing Tactics Affiliate ASHLAND will utilize~: Initials 1 TVN Digital Entertainment Preview/Barker Channel / ~ ~ 2. Cross-Channel Video Spots G~ ~ ¢/A..- 3. Print Ad Slicks [~ ~ 4, CSR Incentive Contest Promotions ~ 5. Outbound Telemarketing. r~ 6. Invoice Messaging. r~ 7. Guide Advertising. ~.,L.-~ ~v~)~'~'~ "&,~,9¢' ~ ~ 8. Additional Tactics: Q Marketing Allowances A one-time launch support marketing allowance will be granted to ASHLAND by DCTV equal to $1.00 for each analog subscriber in the System to whom the DCTV Service is available for sign-up. These funds may be used by ASHLAND in support of mutually agreed upon launch materials and/or tactics. A $15.00 subscriber retention marketing co-op allowance will be granted to ASHLAND by DCTVfor each DCTVSubscriber acquired in a System during the first year of DCTV Service. These funds will be available on a 50/50 cooperative basis to execute mutually agreed upon marketing tactics that are focused on increasing DCTV Service penetration and orders for TVN PPV movies and events. ~ASHLAND will check and initial each box as applicable. TVN ENTERTAINIV~I~NT CORPORATION 2901 West AlamedaAvenue, Burbank California 91505 · 818.5265000 Fax: 818.5265001 · wwwtvncom Number of TVN Transponders Downlinked~ SCHEDULE E DCTV Affiliate Selections 4 IPPV Yes Yes No HITS 1 HITS 2 HITS 4 HITS 5 HITS 7 HITS 8 HITS 10 Affiliate Initials 2. ANI or IPPV Service (choose one) 3. Include Spice PPV Service2 4. Include Playboy Channel2 5. Include DMX3 6, Other (Non-DCTV) Digital Programming4 (list the name of each service) ~ Minimum 3 TVN transponders must be accessed for DCTV Service. Number of TVN transponders accessed will ,determine the number of available PPV and DMX channels and the applicable Schedule C-I fees. ' Spice and Playboy Channel programming is licensed by TVN from Playboy Entertainment, and will be provided !o ASHLAND upon request as long as they are available to TVN and offered via the DCTV Service. ' The DMX and TV Guide services are licensed by TVN from DMX and TV Guide, respectively, and will be provided to ASHLAND as part of the DCTV Service so long as each is available for distribution by DCTV or TVN. ~ ASHLAND will (I) obtain all licenses required from each non-DCTV programming provider and/or HITS, (ii) purchase the head-end equipment needed for reception, transcoding, modulation and retransmission of such non- DCTV programming, and (iii) be solely responsible to report and timely pay license fees to each such programmer(s). TVN ENTERTAINI~NT CORPORATION ) V'~e.st Ala ~eda Av~nue !: nbar',k (]ahforma 91505 · 8185265000 Fax: 818.5265001 * wwwtvn.com SCHEDULE F Proprietary Marks TVN - registered service mark TVN Logo - registration pending TVN DIGITAL CABLE TELEVISION - registration pending TVN DIGITAL ENTERTAINMENT- registration pending DCTV - registration pending Note: ASHLAND must also comply with all applicable trademark use requirements from all non- DCTVFFVN digital services, including the Playboy Entertainment Group, DMX and TV Guide, as made known to ASHLAND from time to time. TVN ENTERTAINIVlI~NT CORPORATION 90 West Alameda Avenue, BL~rbank, California 91505 · 818526 5000 Fax: 818.526.5001 · wwwtvn.com SCHEDULE G Affiliate's current analog channel line-up (Attach Additional Sheet as Schedule G-1 ) TVN ENTERTAINMII~NT CORPORATION WestAlamec~aAYenue, Burbank, California 91505 · 8~85265000 Fax: 818 526.5001 · www.tvn.com SCHEDULE H Equipment Cost ASHLAND Purchase Price of Schedule B Equipment $ Per Head-End ASHLAND Purchase Price of Schedule H-1 Equipment $ Per Head-End ASHLAND Purchase Price for 100 G.I. DCT 2000 $ Model # ABCDEF ($294.20 per unit price)2 ASHLAND Purchase Price for 100 TVN 200 Remote $ Control Units ($7.00 per unit price) Total Equipment Cost $ --Less Prepaid Initial Equipment Payment ~ -- $ --Balance Payable by ASHLAND~ $ 43,575.O0 49,265.00 29,420.00 700.00 122,960.00 61,480.00 61,480.00 Amount Reimbursed by DCTV for Schedule B Equipment3 $ 33,575.00 'Plus shipping and taxes. 2 This is the per-unit price for the above referenced G.I. Model Digital set-top with standard features and MPEG royalty; price quote subject to change without notice. 3As provided per Schedule C-2. TVN ENTERTAINIV~I~NT CORPORATION ~901 West Alameda Avenue, Burbank California 91505 · 818526.5000 Fax: 818.526.5001 · www,tvn,com SCHEDULE H-1 Affiliate's Other Digital Equipment List of digital equipment to be installed at the System head-end for reception of the other (non-DCTV) digital programming~: DIGITAL EQUIPMENT INSTALLED AT SYSTEM HEAD-END: 1 2 3. 4. 5. 6. 7. 8. IRT-1000 Units ..................................................................... # 7 IRT-2000 Units ..................................................................... # 0 C6U Units ............................................................................ # 4 OM-1000 Units ...................................................................... # 1 Ethernet Hub ......................................................................... # 0 Remote Bridge ...................................................................... # 0 Rack(s) ............................................................................... # 1 Pre-Pack Services ...................................................................# 0 ~This Schedule H-1 equipment will be purchased/financed by ASHLAND at its sole expense for reception of the non-DCTV digital programming added by ASHLAND per Schedule E (see paragraph 5), TVN ENTERTAINI~i'NT CORPORATION West Alar'neda Avenue, BL,rbank, California 91505 * 8185265000 Fax: 818.5265001 · wwwtvncom SCHEDULE H-2 Equipment Configuration Configuration of Affiliate's Schedule B Equipment (Attach additional sheet). TVN ENTERTAINMENT CORPORATION ~90 West Alarneda Avenue, Burbank, California 91505 · 818 526.5000 Fax: 818.526 5001 · www.tvn.com SCHEDULE ! Certification for Delivery and Acceptance of Head-End Equipment TO: TVN ENTERTAINMENT CORPORATION Pursuant to paragraph 4 of the DCTV Affiliation Agreement, ASHLAND hereby certifies that aJI the equipment listed below has been delivered and installed at the System head-end, and is accepted. MODEL I MANUFACTURER I SERIAL NO. DC'FV AFFILIATE: City of Ashland, Oregon by and through its Electric Utilities' Fiber Network Division (LEGAL NAME OF COMPANY) BY: (AUTHORIZED SIGNATURE) (PRINT NAME AND TITLE) DATE: ,19 TVN ENTERTAINNII~:NT CORPORATION !(, L~est &~ar~,eda A~rl,le B,~rSarlk Cahfornia 91505 · 818 526.5000 Fax: 8185265001 · wwwtvn.com