Distribution Agreement
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CONFIDENTIAL, NON-PRECEDENTIAL DISTRIBUTION AGREEMENT “UNTITLED ERIC SINGER PROJECT” As of May 15, 2012 This agreement (“Agreement”) is entered into between Sony Pictures Worldwide Acquisitions Inc. (“SPWA”) and Panorama Media LLC (“Agent”), as agent for White Dog Productions LLC (“Owner”; Agent and Owner shall be collectively referred to herein as “Licensor”), confirming SPWA’s acquisition of certain rights to the motion picture (and all versions thereof) tentatively entitled “Untitled Eric Singer Project” a/k/a “American Hustle”, “American Bullshit” and “American Sting” (the “Picture”). For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties have agreed to the following: 1. Conditions Precedent. All of SPWA’s obligations hereunder shall be subject to and conditioned upon the satisfaction of all of the following conditions precedent (collectively, the “Conditions Precedent”): 1.1. Executed Documents. Full execution of this Agreement and the Instrument of Transfer (in the form attached hereto as Schedule D). 1.2. Chain of Title. SPWA’s written approval of all documents (including, without limitation, any and all releases which Licensor, in consultation with SPWA, may require from actual persons, if any, who may be portrayed or depicted, in whole or part, in the Picture) and the copyright status of all materials upon which the Picture is based, evidencing Licensor’s clear and unencumbered chain of title with respect to the Picture and each and every element thereof and the production, distribution and other exploitation thereof and Licensor’s ownership of all rights in the Picture required in order for Licensor to grant to SPWA all rights granted herein, free and clear of all liens, claims and encumbrances (collectively, the “Chain of Title”). 1.3. Security Documents. Licensor’s execution and delivery to SPWA of such security documents (in accordance with Paragraph 21.below) and other instruments consistent herewith as SPWA may require to evidence and and/or perfect its security interest and other rights in the Picture, including, without limitation, a short form Instrument of Transfer in the form attached hereto as Schedule “D”, a Security Agreement and Mortgage of Copyright in the form attached hereto as Schedule “G”, and UCC-1 Financing Statements in form and substance satisfactory to SPWA. 1.4. Insurance Policies. Licensor’s procurement of insurance policies and delivery to SPWA of copies of such policies and certificates of insurance in accordance with the requirements of Paragraph 17 of this Agreement. 1 E:\LEGAL\STEINBERG\PANORAMA\AMBULL\DISTRIBUTION AGREEMENT 5.1.DOCX CONFIDENTIAL, NON-PRECEDENTIAL 1.5. Columbia Distribution Agreement. Licensor’s conclusion of a distribution agreement with Columbia Pictures Industries, Inc. (“Columbia”) with respect to the wide theatrical release of the Picture in the United States. 2. Picture Specifications/Completed Picture Specifications/Domestic Release Obligation. 2.1. Picture Specifications. The specifications for the Picture are set forth below (collectively with the Completed Picture Specifications set forth in Paragraph 2.2, the “Picture Specifications”). All such Picture Specifications shall be approved (or pre-approved as may be specifically indicated herein) by SPWA in SPWA’s sole discretion in writing. Substitutions or changes to approved Picture Specifications shall be subject to SPWA’s prior written approval exercisable in SPWA’s sole discretion. SPWA’s Executive Vice President of Legal Affairs is hereby designated as SPWA’s sole designee for purposes of all approvals hereunder. It is Licensor’s responsibility to confirm that all of SPWA’s approval rights as set forth hereunder have been satisfied in writing and Licensor acknowledges that, except as may be specifically set forth herein, Licensor shall never rely on SPWA’s silence or inactivity as either approval or a waiver of any of the approval rights hereunder. 2.1.1. Approved Screenplay. The Picture shall utilize the final shooting script written by Eric Singer dated as of February 18, 2013 or such other final shooting script approved in advance in writing by SPWA in SPWA’s sole discretion or by Columbia (once approved, the “Approved Screenplay”). Except as otherwise approved by SPWA in writing, the Picture shall be based upon and conform to the Approved Screenplay subject only to incidental, non-material changes resulting from the exigencies of production and customary non-material directorial changes. 2.1.2. Director. The Picture’s director shall be David O’Russell (“Director”). SPWA shall have approval over any replacement(s) of the Director, such approval not be unreasonably withheld or delayed. Licensor agrees that the form and substance of the Director’s agreement in connection the Picture, shall conform to standard industry practices and Director’s precedent (e.g., not contain any unusual credit provisions). Licensor acknowledges that, subject to the terms of any applicable guild, the Director shall render directing services so as to ensure that the Picture materially adheres to: (i) the Approved Screenplay; and (ii) the Approved Budget (as defined below). 2.1.3. Principal Cast. SPWA shall have approval over the selection of the following principal cast (and any replacements thereof) (individually and collectively, “Principal Cast”). SPWA approves Christian Bale (“Bale”) in the role of “Melvin Weinberg” and Bradley Cooper (“Cooper”) in the role of “Jimmy Boyle”. Licensor agrees that the form and substance of each agreement in connection the engagement of Principal Cast will conform to standard industry practices for talent of comparable stature, shall be consistent with such talent’s precedent and shall not include any non-customary limitations on use of likeness, credit and/or marketing and promotional services. 2.1.4. Essential Elements. Bale and Cooper in the roles set forth in the preceding Paragraph shall each be an essential element, the absence of which shall relieve E:\LEGAL\STEINBERG\PANORAMA\AMBULL\DISTRIBUTION AGREEMENT 5.1.DOCX 2 CONFIDENTIAL, NON-PRECEDENTIAL SPWA of any and all of its obligations hereunder (each, an “Essential Element”). 2.1.5. Credit Approval. Except as set forth in the pre-existing “Approved Agreements” (as defined below), SPWA and Licensor shall have mutual approval over (i) the according of any likeness guarantees, (ii) the grant of any likeness tie-ins between/among cast members, and (iii) the according of artwork title credit. For purposes hereof, “Approved Agreements” shall mean the following agreements which were concluded prior to SPWA’s involvement in the Picture and which were delivered to SPWA prior to execution hereof, (i) the agreement for the directing services of Director, and (ii) the agreements for the acting services of Bale and Cooper. 2.1.6. Approved Budget. The Picture shall be produced according to a minimum budget approved by SPWA, such approval not to be unreasonably withheld or delayed (once approved, the “Approved Budget”). SPWA pre-approves an Approved Budget which shall not be less than Forty Million U.S. Dollars (US$40,000,000). 2.1.7. Special Processes. Unless approved by SPWA in advance, Licensor shall not utilize any special photographic, audio and technical processes for the Picture which impact the commercial viability of the Picture and/or SPWA’s costs of exploiting the Picture (e.g., increased duplication costs). 2.2. Completed Picture Specifications. Licensor represents and warrants that upon delivery to SPWA, the Picture shall meet all of the following specifications (collectively, the “Completed Picture Specifications”): 2.2.1. The Picture. Licensor shall deliver a new and original feature-length motion picture of first class technical quality. The Picture shall be completed and delivered to SPWA on or before the Delivery Date (as defined herein), time being of the essence. 2.2.2. Actual Negative Cost. The Picture’s aggregate, certifiable, final cash production cost (“Actual Negative Cost”) shall be no less than Ninety Percent (90%) of the Approved Budget, certified as to its accuracy by the director, the line producer and the production accountant and completion guarantor for the Picture. Actual Negative Cost shall mean the aggregate sum of all costs and expenses directly related to the Picture actually paid in connection with the development, preparation, production, completion, and Delivery (as defined herein) of the Picture, as set forth in the Approved Budget. Additionally, such Actual Negative Cost: (i) shall include, without limitation, the producing fees and all financing and completion bond related costs and/or fees; (ii) shall exclude any contingent compensation (whether in gross receipts or otherwise) and/or amounts contingent on the level of financial performance of the Picture; and (iii) shall be net of: (A) any production savings; (B) any unspent contingency and/or (C) any subsidies, credits or rebates. Licensor shall, within thirty (30) days of Delivery, provide SPWA with an “Actual Negative Cost Statement”, certified as true and correct by the production accountant and by a duly-authorized officer of Licensor. Any such statement not objected to within two (2) years of issuance shall be deemed true and correct and binding upon SPWA. SPWA shall have the right upon fifteen (15) days notice to examine Licensor’s books and records with respect to the Actual Negative Cost for the purpose of determining the E:\LEGAL\STEINBERG\PANORAMA\AMBULL\DISTRIBUTION AGREEMENT 5.1.DOCX