Stand-Alone Svod License Agreement

Effective Date: September 1, 2012

Country: South Korea

Contract No:

STAND-ALONE SVOD LICENSE AGREEMENT

LICENSEE: Orion Cinema Network Inc. / LICENSOR: Sony Pictures Television Korea Inc., a Delaware corporation operating in Korea through its registered Korean branch office
(Address and Fax Number): / (Address and Fax Number): 10202 West Washington Boulevard
Culver City, CA 90232, United States of America
TERRITORY(S):Republic of Korea, its territories and possessions / SERVICE(S):The SVOD service known as “CatchOn Demand,” wholly-owned and operated by Licensee and offeredon a stand-alone basis (i.e., independent of the linear pay television channels known as “CatchOn” and “CatchOn Plus”) (“Stand-Alone SVOD Service”).
AUTHORIZED LANGUAGE (specify if dubbed and/or subtitled):
Original language, or, if its original language version is not Korean or English, dubbed or subtitled into Korean and subtitled into English
PROGRAM NAME (and episode numbers, if applicable):
See Section 2, Programs, in Exhibit 2. / EXCLUSIVITY:N/A. In no event shall there be any restrictions on Licensor’s right to exploit any of the Programs on a Pay-Per-View Basis, Near-Video-On-Demand Basis or Video-On-Demand Basis or in any language other than the Authorized Language.

LICENSE PERIOD: For each Program during the Term, the License Period shall commence on the Availability Date thereof and terminate on the date that is twelve (12) months thereafter (unless terminated earlier in accordance with Section 3.1 and/or Article 14 of the Standard Terms and Conditions).

Availability Dates: As determined by Licensor in its sole discretion; provided, however, that it shall be no later than the earliest to occur of (a) seven (7) months after its Home Video Street Date in the Territory, (b) sixteen (16) months from its theatrical release in the Territory, and (c) thirty-one (31) months from its theatrical release in the U.S. As used herein “Home Video Street Date” with respect to an Program shall mean the date on which such Program is first made available in the Territory to the general public in the standard DVD format.

TOTAL LICENSE FEE: As provided in Exhibit 2.
If Flat Fee: n/a / If Subscriber-based:
CPS: As provided in Exhibit 2.
Minimum Subscriber Guarantees: As provided in Exhibit 2.
Minimum License Fee: As provided in Exhibit 2.

PAYMENT TERMS:As provided in Section 5 of Exhibit 2.

MATERIALS SPECIFICATIONS: See Article 6 of Standard Terms and Conditions.

OTHER:

Attached hereto as Exhibit 1 are the Standard Terms and Conditions and Rider to Exhibit 1 governing the license granted by Licensor to Licensee hereunder. Attached hereto as Exhibit 2 are Additional Terms and Conditions of Stand-Alone SVOD License Agreement governing the license granted by Licensor to Licensee hereunder.Attached hereto as Exhibit 3 are the Content Protection Requirements and Obligations. Attached hereto as Exhibit 4 are the Usage Rules. Licensor and Licensee hereby acknowledge and agree that all of the terms and conditions set forth in Exhibits 1, 2, 3 and 4 are hereby incorporated into this SVOD License Agreement by this reference as if fully stated herein (the “SVOD License Agreement”). To the extent the standard terms and conditions (Exhibit 1) conflict with the terms set forth above and in Exhibits 2-4, the terms set forth above and in Exhibits 2-4 shall prevail. Capitalized terms not otherwise defined shall bear the meanings set forth in Exhibits 1-4.

Licensor Name:Sony Pictures Television Korea Inc. / Licensee Name: Orion Cinema Network Inc.
By (signature):
Name: ______
Title: / By (signature):
Name: ______
Title:

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Rider to
EXHIBIT 1

The following amendments shall be made to Exhibit 1, Standard Terms and Conditions of the SVOD License Agreement:

1.1Section 1.1.6, definition of Delivery System, shall be amended and restated in its entirety as follows:

“Delivery System” shall mean a cable television system, a master antenna system, a SMATV system, an MDS System, a DTH system or a master antenna system which receives programming directly from a satellite. Delivery System shall also include IPTV Delivery, Internet Delivery and Mobile Delivery.

1.2Article 1 of Exhibit 1 shall be amended by adding the following new definitions in proper alphabetical order:

“Approved Connected Television” means a television capable of receiving and displaying protected audiovisual content viaa built-in IP connection. An Approved Connected Television shall implement the Usage Rules and support Internet Delivery and the Content Protection Requirements and Obligations set forth in Exhibit 3.

“Approved Mobile Device” means an individually addressed and addressable IP-enabled mobile hardware device of a user, excluding a desktop or laptop or personal computer, that generally receives transmission of a program over a transmission system designed for mobile devices such as GSM, UMTS, LTE and IEEE 802.11 (“wifi”) and runs on the iOS or Android operating system. An Approved Mobile Device shall implement the Usage Rules and support Internet Delivery and Mobile Delivery and the Content Protection Requirements and Obligations set forth in Exhibit 3. Approved Mobile Device shall not include a set-top box, tablet or personal computer or any device that does not run on the iOS or Android operating system.

“Approved Personal Computer” means an individually addressed and addressable IP-enabled desktop or laptop device with a hard drive, keyboard and monitor, designed for multiple office and other applications using a silicon chip/microprocessor architecture that supports one the following operating systems: Windows XP, Windows 7 or Mac OS or subsequent versions of the foregoing (“Permitted OS”), implements the Usage Rules, and supports Internet Delivery and the Content Protection Requirements and Obligations set forth in Exhibit 3. Approved Personal Computers do not include game consoles, set-top-boxes, portable media devices (such as the Apple iPod), tablets, PDAs and mobile phones, or any device running an operating system other than a Permitted OS or an operating system designed for portable or mobile devices, including, without limitation, Microsoft Smartphone, Microsoft Windows CE, Microsoft Pocket PC and future versions thereof.

“Approved Set-Top Box” means a set-top device approved in writing by Licensor designed for the exhibition of audio-visual content exclusively on a conventional television set, using a silicon chip/microprocessor architecture. An Approved Set-Top Box shall implement the Usage Rules and support IPTV Delivery and the Content Protection Requirements and Obligations set forth in Exhibit 3. Approved Set-Top Box shall not include a personal computer or any form of mobile device.

“Approved Tablet” means an individually addressed and addressable IP-enabled device with a built-in screen and a touch screen keyboard, for which user input is primarily via touch screen, that is designed to be highly portable, not designed primarily for making voice calls, and runs on one of the following operating systems: iOS, Android, WebOS or RIM’s QNX Neutrino (each, a “Permitted Tablet OS”). An Approved Tablet shall implement the Usage Rules and support Internet Delivery or Mobile Delivery and the Content Protection Requirements and Obligations set forth in Exhibit 3. An Approved Tablet shall not include personal computers, game consoles, set-top-boxes, portable media devices, PDAs, mobile phones or any device that runs an operating system other than a Permitted Tablet OS.

“Internet Delivery” means (i) the Encrypted streamed delivery of digital electronic media file embodying an audio-visual program (ii) over the public, free to the consumer (other than a common carrier/ISP charge) global network of interconnected networks (including the so-called Internet, Internet2 and World Wide Web) using IP technology, whether transmitted over cable, DTH, FTTH, ADSL/DSL, broadband over power lines or other means, (iii) to an Approved Personal Computer, Approved Mobile Device, Approved Connected Television and/or Approved Tablet.

“IPTV Delivery” means (i) the Encrypted streamed delivery of a digital electronic media file embodying an audio-visual program (ii) over a closed television network that is composed of fiber optic telephone lines, twisted copper wire and/or coaxial cable lines and located solely in the Territory, (iii) to an Approved Set-Top Box, (iv) using IP technology.

“Mobile Delivery” shall mean the transmission in whole or in part of audio and/or visual signals (i) via cellular wireless networks integrated through the use of (a) any of the following protocols: 2G (GSM, CDMA), 3G (UMTS, CDMA-2000), 4G (LTE, WiMAX), or (b) any additional protocols, or successor or similar technology as may be agreed by the parties in writing from time to time, (ii) to an Approved Mobile Device and/or Approved Tablet.

“SVOD” shall mean the point-to-point delivery of a program distribution service whereby the viewer is able to receive, in response to the request of such viewer, an exhibition of a program that is a part of a group of programs (i)for which the viewer is charged a monthly subscription fee, and not on a per program(s) or per exhibition(s) basis, which fee is unaffected in any way by the purchase of other programs, products or services, but not referring to any fee in the nature of an equipment rental or purchase fee and (ii)the exhibition start time of which is at a time specified by the viewer in its discretion. SVOD shall not include exhibition on a Video-On-Demand Basis.

“Usage Rules” shall mean the content usage rules applicable to the Programs on the Licensed Service as set forth in Exhibit 4 attached hereto.

1.3Section 2.1 shall be amended and restated in its entirety as follows:

2.1 Grant/Acceptance. Subject to the payment of the License Fee in accordance with the SVOD License Agreement, and the due performance by Licensee of its obligations hereunder, and provided that Licensee is not in material breach of its obligations hereunder, Licensor hereby grants to Licensee a limited, non-exclusive license (except as otherwise specified in the SVOD License Agreement) to exhibit each Program on an SVOD basis solely over the Stand-AloneSVOD Service via the Delivery System to Subscribers (subject to the SVOD Restrictions set forth in Section 7 of Exhibit 2), in the Territory in the Authorized Language during its License Period, subject at all times to the Usage Rules, and Licensee shall so license from Licensor such right. Licensee shall exhibit each Program in its entirety. Such exhibition shall be solely on the Licensed Service(s) either directly to Subscribers or to Affiliated Systems and Affiliated Institutions as follows:

1.4Section 2.2, Prohibitions, shall be amended by replacing the words “other than on a Subscription Pay Television Service” with “other than on a SVOD basis as specifically described herein”.

1.5Section 2.5, Security/Copy Protection, shall be amended by adding the following new sentence at the end thereof:

Licensee shall at all times utilize copy protection and DRM standards no less stringent or robust than the standards in the Content Protection Requirements and Obligations attached hereto as Exhibit 3.

1.6Section 5.4 shall be amended and restated in its entirety as follows:

5.4Monthly Reports. With respect to each month of the Term, until the last month of the latest expiring License Period under the SVOD License Agreement, Licensee shall deliver to Licensor a statement for such month (“Reporting Month”) within 45 days following the conclusion of such Reporting Monthwith respect to the Stand-Alone SVOD Service:

(i)the actual aggregate number of Subscribers to the Stand-Alone SVOD Service on the first and last day of such Reporting Month

(ii)the actual number of viewings of each Program for such Reporting Month on the Stand-Alone SVOD Service;

(iii)the actual number of unique Subscribers who viewed each Program on the Stand-Alone SVOD Service for such Reporting Month;

(iv)the actual monthly subscription fee charged to Subscribers of the Stand-Alone SVOD Service for such Reporting Month; and

(v)such other information that Licensor may reasonably request.

Each payment of the License Fee with respect to the Stand-Alone SVOD Service made pursuant to this SVOD License Agreement shall be accompanied by an accounting statement including the following information:

(vi)appropriate calculations of the Actual Stand-Alone SVOD License Fee, including the actual subscription fee charged each month by Licensee to Subscribers andthe number of Actual Stand-Alone SVOD Subscribers for such month;

(vii)appropriate calculations of the Overage; and

(viii)such other information that Licensor may reasonably request.

1.7The first sentence in Section 11.1(b) shall be amended and restated in its entirety as follows:

Licensor shall indemnify and hold Licensee, its parent, subsidiaries and affiliates and its and their respective officers, directors, successors and assigns (collectively, the “Licensee Indemnified Parties”), harmless from any and all Claims alleging that that the exhibition of any of the Programs or the exercise of any rights or privileges granted herein in strict accordance with this Agreement infringe upon the trade name, trademark, copyright, music synchronization, literary or dramatic right or right of privacy of any claimant or constitutes a libel or slander of such claimant, except with respect to performing rights in music which are specifically covered by Section 11.2), provided that Licensee shall promptly notify Licensor of any claim or litigation that Licensee is aware of to which the indemnity set forth in this Section 11.1 applies; further provided that the failure to promptly notify Licensor shall diminish Licensor’s indemnification obligations only to the extent Licensor is actually prejudiced by such failure.

1.8The third sentence in Section 12 shall be amended to add the words “that Licensor is aware of” after the words “Licensor shall promptly notify Licensee of any claim or litigation”.

1.9Section 20, Assignment, shall be amended by adding the following at the end thereof:

Notwithstanding anything to the contrary in the first sentence herein, but without limiting any other provision in this Section 20, including, without limitation, in the third sentence herein, Licensee shall have the right to assign its rights under this Agreement to CJ E&M Corp. without obtaining Licensor’s prior written consent.

1.10Section 26, Construction/Venue, shall be amended by deleting each instance of the term “Columbia” therein and substituting the term “Licensor”therefor.

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EXHIBIT 2

ADDITIONAL TERMS AND CONDITIONS OF SVOD LICENSE AGREEMENT

1. / TERM: / The “Term” of the SVOD License Agreement with respect to the Stand-Alone SVOD Service shall commence on September 1, 2012 and end February 28, 2013. Thereafter, the Term automatically extends for four (4) successive 12-month periods (each, an “Extension Period”) unless Licensor, in its sole discretion, gives Licensee notice of non-extension at least 30 days prior to the expiration of the then current Extension Period. The 6-month period commencing on September 1, 2012 and ending February 28, 2013, and each Extension Period thereafter (if any) shall be an “Avail Year” with respect to the Stand-Alone SVOD Service, defined as follows:
Avail Year 1: September 1, 2012 through February 28, 2013
Avail Year 2 (if any): March 1, 2013 through February 28, 2014
Avail Year 3 (if any): March 1, 2014 through February 28, 2015
Avail Year 4 (if any): March 1, 2015 through February 29, 2016
Avail Year 5 (if any): March 1, 2016 through February 28, 2017
2. / PROGRAMS: / In each Avail Year, Licensee shall license for exhibition on the Stand-Alone SVOD Service the following “Programs”: all Current Films (defined below) with an Availability Date during the Term, subject to a cap of 30; provided, that Licensee shall not be required to license more than the lesser of (i) five (5) DTVs and TVMs combined and (ii) all DTVs and TVMs. In the event that the number of Current Films made available exceeds 30, the 30 Current Films to be licensed by Licensee shall be determined in descending order of Seoul theatrical admissions, and thereafter in descending order of U.S. box office from Licensor’s theatrical releases in the United States, with any shortfall between the number of theatrically released Current Films made available and 30 to be made up with DTVs and/or TVMs selected by Licensee, subject to the cap set forth above. “Current Films” shall be feature films released theatrically, direct-to-video (“DTV”) or on television (“TVM”) in the US or the Territory for which Licensor unilaterally controls without restriction all necessary exploitation rights hereunder and which have not been exhibited on linear television in the Territory prior to the Availability Date hereunder. The Programs that Licensee shall license for exhibition on the Stand-Alone SVOD Service during Avail Year 1 are set forth on Exhibit 2-1 attached hereto.
3. / HIGH DEFINITION / (a)Without limiting the rights granted to Licensee in Sections 2.1 and 2.1A of Exhibit 1, and notwithstanding anything to the contrary in Section 2.2 of Exhibit 1, Licensor hereby grants to Licensee the right to exhibit any Program in High Definitionon the Stand-Alone SVOD Service, subject at all times to Section 3(b) below. “High Definition” or “HD” means any resolution that is (a) 1080 vertical lines of resolution or less (but at least 720 vertical lines of resolution) and (b) 1920 lines of horizontal resolution or less (but at least 1280 lines of horizontal resolution).
(b)Licensor shall make available to Licensee, a Copy of a Program in High Definition format upon Licensee’s request, only if such material (“HD Copy”) is readily available to Licensor. Notwithstanding anything to the contrary in Section 6.1 of Exhibit 1, Licensee shall bear all costs of subtitling and dubbing, plus any direct out-of-pocket costs incurred by Licensee with respect to HD Copies (i.e., encoding/duplication via lab access letter, shipping if terms are FOB destination or COD). All costs (including, without limitation, shipping and forwarding charges, and insurance) of creating and delivering to Licensee HD Copies shall be borne by Licensor.
4. / [Intentionally omitted]
5. / LICENSE FEE FOR STAND-ALONE SVOD SERVICE: / (a) Calculation: For each month, the “License Fee” with respect to the Stand-Alone SVOD Service equals the greater of: (i) the Monthly Stand-Alone SVOD Minimum Fee (defined below), and (ii) the applicable Actual Stand-Alone SVOD License Fee (defined below).
“Monthly Stand-Alone SVOD Minimum Fee” equals the product of: (a) the Guaranteed Stand-Alone SVOD Subscribers for such month, and (b) KRW 450.
“Guaranteed Stand-Alone SVOD Subscribers” for each month in the applicable Avail Year shall be:
AVAIL YEAR / GUARANTEED STAND-ALONE SVOD SUBSCRIBERS
Avail Year 1 / 20,000
Avail Year 2, if any / 27,500
Avail Year 3, if any / 50,000
Avail Year 4, if any / 83,000
Avail Year 5, if any / 100,000
“Actual Stand-Alone SVOD License Fee” for each month equals the product of the (a) Actual Stand-Alone VOD Subscribers for such month, and (b) the applicable License Fee Per Stand-Alone SVOD Subscriber.
“Actual Stand-Alone SVOD Subscribers” with respect to each month shall be the number of Subscribers to the Stand-Alone SVOD Service on the first day of such month and the last day of such month divided by two.
“License Fee Per Stand-Alone SVOD Subscriber” equals the greater of: (a) KRW 450, and (b) the product of (i) the actual monthly subscription fee charged by Licensee to Subscribers of the Stand-Alone SVOD Service during such month and (ii) 5.77%.
(b) Payment Terms: Licensee shall pay the Monthly Stand-Alone SVOD Minimum Fees for each month of each Avail Year no later than 60 days prior to the first day of the month of such Avail Year. Each payment of the Monthly Stand-Alone SVOD Minimum Fees for a month shall be applied against the aggregate total of the Actual Stand-Alone SVOD License Fees earned for such month. If the aggregate total of the Actual Stand-Alone SVOD License Fees earned for a month exceeds the amount of the applicable Monthly Stand-Alone VOD Minimum Fee, such excess amount shall be the “Overage”. Licensee shall pay any such Overage within 60 days after the end of the month during which such Overage occurs. All payments hereunder shall be made in Korean Won by wire transfer to the following account: Standard Chartered First Bank Korea Limited, 100 Kongpyung-dong, Chongro'ku, Seoul, 110-702 Korea, Account number: 198-10-050202, SWIFT Code : SCBLKRSEXXX.
6. / NOTIFICATION: / Licensor shall provide Licensee with an availability list as follows:
(a) Each September 1 during the Term, Licensor shall provide Licensee a confirmed list of Programs that will be available during the first six months of the following Avail Year and a tentative list of Programs that will be available during the second six months of such following Avail Year.
(b) Each March 1 during the Term (after Avail Year 1), Licensor shall provide Licensee with a confirmed list of Programs that will be available during the second six months of the then current Avail Year. Licensor will provide Licensee with such confirmed list for Avail Year 1 as soon as practicable after, and in no event more than 30 days after, the Effective Date.
7. / SVOD RESTRICTIONS: / (a) The Stand-Alone SVOD Service must satisfy all the requirements of a Subscription Pay Television Service, other than the requirement that it be a linear, regularly scheduled service.
(b) The Stand-Alone SVOD Service shall not be made available over the facilities of any structure, institution or place of temporary or transient residence, including without limitation, hotels/motels or Affiliated Institutions, or for reception in any room therein (whether public or private), including without limitation, hotel/motel rooms or Rooms in Affiliated Institutions.
(c) Licensee shall not be permitted in any event, without Licensor’s prior written consent, to (i) offer or conduct promotional campaigns for Programs offering free exhibitions, (ii) offer any free trials of the Stand-Alone SVOD Service, or (iii) bundle the Stand-Alone SVOD Service with any other product or service offering
(d) The Stand-Alone Service shall not be advertiser-supported.

EXHIBIT 2-1