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SUBSCRIPTION VIDEO-ON-DEMAND LICENSE AGREEMENT

THIS SUBSCRIPTION VIDEO-ON-DEMAND LICENSE AGREEMENT (this Agreement”), dated as of ____________, 2012 (“Effective Date”), is entered into by and between Colgems Limited, a United Kingdom corporation (“Licensor”), and Netflix Luxembourg S.à r.l., a Luxembourg limited liability company (“Licensee”). For good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1. DEFINITIONS. All capitalized terms used herein and not otherwise defined in this Agreement shall have the meanings set forth below.

1.1. “Animated Half Hour” shall mean a fully animated television series, each episode of which is a half broadcast hour.

[1.2.] “Applications” shall mean web applications created by developers using Application Programming Interfaces (commonly known as APIs) released by Licensee, which web applications will enable Registered Users and other users in the Territory, as applicable, to, for example, access Licensee’s website; add or remove a movie from a Registered User’s “queue;” or receive and watch, via Approved Delivery on an Approved Device [#SPE: To discuss and note remaining requirement we would like to clarify that playback can only take place using a Playback Client and that “Applications” effect a connection to the Neflix service but are not responsible for protecting and rendering content], a trailer, Promotional Preview or Included Program. For the avoidance of doubt, the playback of Included Programs through the use of Applications and Playback Clients shall be:

1.1.1. available to Registered Users only; and will be

1.1.2. hosted and authenticated by the SVOD Service;,

1.1.3. subject to the terms and conditions of this Agreement (including, without limitation, the Usage Rules and Content Protection Requirements and Obligations as set out in Schedule B);, and shall

1.1.4. require the launch of a separate web-browser window or similar user experience (i.e., the launch of a new playback window or web page) in which the Included Program will be playable; and

1.1.5. /or be Netflix-branded, and all Applications shall include a Netflix-branded logo.

1.2.[1.3.] “Approved Delivery” shall mean the streaming delivery of an encrypted (except with respect to files which are not Included Programs, such as promotional materials) digital electronic file over the public, global network of interconnected networks known as the Internet or “Worldwide Web”, using technology which is currently known as Internet Protocol, solely to an IP-addressable device. In no event shall Approved Delivery include downloading; provided that the limited buffering or caching of a temporary file that is inaccessible after initial viewing shall not be deemed downloading in violation of the requirements for Approved Delivery. For purposes of clarification, Approved Delivery shall include without limitation streaming delivery over the public Internet accessed (i) through the use of Blu-ray discs or other optical media that contain certain client software (excluding any Blu-ray discs or other optical media that contain pre-recorded long-form audiovisual

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content) that will initiate and authenticate (by utilizing the disc or optical media in an Approved Device) the transmission of data via IP (e.g., “BD-Live” technology) from the SVOD Service; (ii) through any private, closed or walled-garden IP networks (but in no event through any closed and proprietary cellular audio-visual content service or through any closed and proprietary satellite, cable or fiber optic audio-visual content service); and (iii) through the use of Applications and Playback Clients. [#To discuss]

1.3.[1.4.] “Approved Device” shall mean a Software Device or Hardware Device (i) designed to directly receive audio-visual programming and a decryption key via Approved Delivery and output such programming for exhibition on its associated video monitor and (ii) capable of enforcing (a) the security and content protection specifications set forth on Schedule B attached hereto or such other specifications reasonably agreed to by the parties and (b) the usage rules set forth on Schedule D attached hereto.

1.4.[1.5.] “Approved Format” shall mean a digital electronic media file compressed and encoded for secure transmission (a) in a Content Protection System and resolution in accordance with the specifications set forth in Schedule B attached hereto or (b) such other format as Licensor may approve in Licensor’s sole discretion.

1.5 “Approved Protection System” shall have the meaning set forth in Clause 1.2 of Schedule B.

1.6 “Avail Term” shall have the meaning assigned in Clause 3 hereof.

1.7. “Availability Date” with respect to an Included Program shall mean the date on which such program is first made available by Licensor for exhibition hereunder in accordance with Clause 4.1.

1.8. “Availability List” shall mean a list of Feature Films and/or Television Episodes that are available by Licensor for licensing hereunder in accordance with Clause 5.2.

1.9. “Basic TV” shall mean the delivery and/or exhibition of a motion picture, television show or other entertainment product by any means of transmission to a television set or other viewing device by any technology (whether now known or hereafter devised), which may be advertising supported, where the consumer is charged a monthly or other periodic subscription fee for the first or lowest tier (i.e, “basic” tier) of service, in excess of any obligatory fees or charges for the subscriber to receive Free TV signals, regardless of whether such exhibition is on a regularly scheduled (i.e., linear) basis and/or made available to the consumer on an on-demand basis (i.e., where the timing of such delivery and/or exhibition is not pre-determined, but rather is at the consumer’s discretion). With respect to delivery of content on Basic TV which is not by means of a closed system (i.e., coaxial cable networks, digital satellite networks or closed digital subscriber lines (ADSL), in each case within the private domain of a service provider) but rather by means of Internet transmission (e.g., Internet simulcast, Internet on-demand), such content shall be made available only on an authenticated basis (i.e., where access is pre-conditioned on a consumer’s existing, authenticated subscription to the linear, closed system Basic TV service). For clarity, Basic TV does not include any Subscription Pay TV, Free TV or SVOD.

1.10. “Business Day” shall mean any day other than (i) a Saturday or Sunday or (ii) any day on which banks in Los Angeles, California are closed or are authorized to be closed.

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1.11. “Clips” shall mean up to two (2) trailers or excerpts at any one time from each Included Program made available to Licensee by Licensor.

1.14 “Current Series” shall mean a Television Series which Licensor makes available for license hereunder where at least one season of the series is being broadcast either (i) in the Territory or the U.S. for the first time during the Avail Term; or (ii) is still in production during the applicable Avail Year. Current Series shall be designated as “Current Series – 1 Hour” (i.e., where the duration of each episode is one broadcast hour) and “Current Series – Half Hour” (i.e., where the duration of each episode is a half broadcast hour).

1.15. “Event of Force Majeure” in respect of a party shall mean any reasonably unforeseeable act, cause, contingency or circumstance beyond the reasonable control of such party, including, without limitation, any governmental action, nationalization, expropriation, confiscation, seizure, allocation, embargo, prohibition of import or export of goods or products, regulation, order or restriction (whether foreign, federal or state), war (whether or not declared), civil commotion, disobedience or unrest, insurrection, public strike, riot or revolution, fire, flood, drought, other natural calamity, damage or destruction to plant and/or equipment, or any other accident, condition, cause, contingency or circumstance (including without limitation, acts of God within or without the United States), but shall not include an inability to pay for whatever reason.

1.16. “Feature Film(s)” shall mean those feature-length films which Licensor makes available for license hereunder, including any Library Feature. Feature Films made available by Licensor and licensed by Licensee shall be Included Programs for all purposes of this Agreement.

1.17. “Free TV” shall mean the scheduled linearly programmed delivery and/or exhibition of a motion picture, television show or other entertainment product by any means of transmission to a television set or other viewing device by any technology (whether now known or hereafter devised), which shall be advertising supported and/or contain programming breaks (except in the case of the BBC), where the consumer is not charged any fees or charges (other than any compulsory fees charged by a government or governmental agency assessed on those who use television sets) . For clarity, Free TV does not include Subscription Pay TV or Basic TV.

1.18. "FVOD/AVOD" shall mean the delivery of a program to a viewer located in the Territory via a delivery system in a service which is not supported by subscriptions, which may or may not be advertising supported and which permits the viewer to stop and start, pause, fast-forward and rewind the exhibition of the program in its entire discretion, at a time chosen by the viewer, (i.e. the viewer can independently select his/her desired viewing time without reference to a list of possible viewing times pre-established by the exhibition of the service provider) without charge to the viewer (other than any compulsory fees charged by a government or governmental agency assessed on those who use television sets).

1.19. “Holdback(s)” shall have the meaning set out in Clause 4.2.2

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1.21. “Hardware Device” shall mean an individually addressed and addressable IP-enabled hardware device used by a Registered User, excluding tablets, desktop or laptop personal computers and mobile phones, that contains an integrated Licensee-branded Playback Client, including, without limitation, a set-top box (including without limitation a box with an integrated personal digital recorder (DVR) and/or web browser), an Internet-enabled television, a media extender, a home theater, a game console (including without limitation the PlayStation 3, Xbox 360 and Nintendo Wii, and any successor platforms thereto), a network-connected Blu-ray and/or DVD player, and a portable device.

1.20. “High Definition” shall mean resolutions higher than 345,600 viewable pixels, in the case of NTSC, or 414,720 viewable pixels, in the case of PAL, but no greater than 2,073,600 viewable pixels, in the case of either NTSC or PAL.

1.21. “Home Theatre” means on-demand exhibition and/or sell-through of any program on a material premium basis prior to the LVR of such program.

1.22. “Included Program” shall mean any Feature Film and/or Television Episode made available by Licensor and licensed by Licensee hereunder in accordance with the terms of this Agreement.

1.25 “Launch Date” shall mean the date on which the SVOD Service is commercially available offering full-length major studio feature film and/or television programming to the general public in the Territory.

[1.26] “Launch Pack” shall mean the titles agreed between the parties as listed in Schedule A. [#TBC]

[1.27] “Library Feature” shall mean (i) a Feature Film which Licensor makes available for license hereunder with an Availability Date that is ten (10) years or more from such film’s initial Theatrical release date in the US, and which shall be designated by agreement between the parties Tier A, Tier B or Tier C, (ii) Library DTVs and (iii) Library MOWs.

1.26[1.28] “Library DTV” shall mean a Feature Film that has not been Theatrically released in the US, released direct to video and which Licensor makes available for license hereunder with an Availability Date that is five (5) years or more from such film’s initial local video release in the US.

1.27[1.29] “Library MOW” shall mean any feature-length, television movie that is initially exhibited on a US broadcast television network and which Licensor makes available for license hereunder with an Availability Date that is five (5) years or more from such film’s initial broadcast in the US.

1.28[1.30] “Library Series” shall mean a Television Series that is not a Current Series or a Non-Returning Series which Licensor makes available for license hereunder, with an Availability Date that is at least three (3) years following the last season of production.

1.29[1.31] “Licensed Language” shall mean for each Included Program (i) the original language version, (ii) English (if the original language is other than English), (iii) Swedish (if the original language is other than Swedish), (iv) Norwegian (if the original language is other than Norwegian), (v) Finnish (if the original language is other than Finnish), and (vi) Danish (if the original language is other than Danish).

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1.30[1.32] “License Period” with respect to each Included Program shall mean the period during which Licensee may exhibit such Included Program as specified in Clause 4.2.

1.31[1.33] ”Local Video Release Date” or “LVR” means, in respect of each Included Program, the first day on which any DVD or Blu-ray disc or EST embodying such Included Program is authorized by Licensor (or any affiliate of Licensor) to be made available to consumers in the Territory for rental or EST.

1.32[1.34] “Major Studio” shall mean Paramount Pictures, Twentieth Century Fox Film Corporation, The Walt Disney Company, Universal Studios, Sony Pictures Entertainment Inc., Warner Bros., and Metro-Goldwyn-Mayer Inc.

1.33[1.35] “Mobile Device” shall mean an individually addressed and addressable IP-enabled mobile hardware device of a user, excluding a tablet, desktop or laptop or personal computer, supporting an Approved Format and generally receiving transmission of a program over a transmission system designed for mobile devices such as GSM, UMTS, LTE and IEEE 802.11 (“wifi”).

1.34[1.36] “Non-Returning Series” shall mean a Television Series that (i) has been cancelled or is no longer in production and (ii) does not qualify as a Current Series hereunder which Licensor makes available for license hereunder, including all broadcast seasons thereof, with an Availability Date that is less than three (3) years following the last season of production. Non-Returning Series shall be designated as “Non-Returning – 1 Hour” (i.e., where the duration of each episode is one broadcast hour) and “Non-Returning – Half Hour” (i.e., where the duration of each episode is a half broadcast hour).

1.35[1.37] “Non-Theatrical Exhibition” shall mean the exhibition of a motion picture, television show or other entertainment product to audiences at the physical facilities (i) of airplanes, trains, ships and other forms of common carrier transportation, (ii) of schools, colleges and other educational institutions, government agencies, libraries, religious and civic groups, holiday camps, clubs and services organizations, (iii) of non-public areas of hotels, motels and other lodging; (iv) in permanent or temporary military installations, shut-in institutions, prisons, hospitals, retirement centers, offshore drilling rigs, logging camps and construction camps; and (v) industrial, corporate, retail and commercial establishments, and for which exhibition an admission fee may be charged.

1.36[1.38] “Personal Computer” shall mean an IP-enabled desktop or laptop device with persistent storage, keyboard and monitor, designed for multiple office and other applications using a silicon chip/microprocessor architecture and shall not include any Portable Devices. A Personal Computer must support one of the following operating systems: Windows XP, Windows 7, Windows 8, Mac OS, Chrome OS, subsequent versions of any of these, and other operating system agreed in writing with Licensor.

1.37[1.39] “Personal Use” shall mean the private viewing by one or more persons on an Approved Device in non-public locations and, provided that the consumer’s use of Approved Devices in such locations is personal, in public locations; provided, however, that any such viewing for which a premises access fee or other admission charge is imposed (other than any fee related only to access such non-residential venue for other general purposes) or any such viewing that is on a monitor provided by such non-residential venue (or by a third party under any agreement or arrangement with such non-residential venue) shall not constitute a “Personal Use.”

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[1.40] “Playback Client” shall mean a device or application that can play or render Included Programs received from the SVOD Service. A Playback Client may be integrated into an Approved Device at time of manufacture or may be downloaded to an Approved Device after manufacture. A Playback Client may be implemented via an Application. A Playback Client must incorporate an Approved Protection System or be installed on an Approved Device that incorporates an Approved Protection System.“. “Playback License” shall mean a secure electronic token which grants a Playback Client permission to play an Included Program. Playback Clients which provide Link Layer Protection Playback do not require Playback License in order to play an Included Program.

1.38[1.41] “Promotional Preview” with respect to an Included Program shall mean a video clip of such Included Program commencing at the beginning of such Included Program and running no longer than five (5) consecutive minutes thereafter (“Maximum Preview Duration”), with no additions, edits or any other modifications made thereto.

1.39[1.42] “Registered User” shall refer to each unique user resident in the Territory of an Approved Device registered with the SVOD Service and authorized to view an exhibition of an Included Program as part of the SVOD Service. [#To discuss]

1.46 “Security Breach” shall mean a Security Flaw that results or may reasonably result in the unauthorized availability of any Included Program or any other motion picture that originated in its compressed form from files obtained from the SVOD Service, which unauthorized availability may result in actual or threatened harm to Licensor. For clarity, a Security Breach does not include a Territorial Breach or a geofiltering Security Flaw. [# To discuss. Previously agreed and standard definition for Security Breach must be uniform across all agmts. This topic requires a wider discussion between SPE and Netflix, and is not a security topic alone]

1.47 “Security Flaw” shall mean a circumvention or failure of the Licensee’s secure distribution system, geofiltering technology or physical facilities.

1.48 “Software Device” shall mean an IP-enabled, uniquely addressable Personal Computer, Tablet or Mobile Device that is not certified by Licensee as a Hardware Device and is capable of playing back content from the SVOD Service solely through the utilization of a software-based Playback Client; provided, however that Mobile Devices shall constitute Software Devices solely when receiving such audio-visual programming through the public Internet (as described in Clause 1.2). For the avoidance of doubt, Mobile Devices shall not constitute Software Devices when receiving audio-visual programming through any closed and proprietary cellular audio-visual content service (e.g., an equivalent in the Territory to Verizon’s V-Cast video service), or through any closed and proprietary satellite, cable or fiber optic audio-visual content service (e.g. Cablevision or Telefonica IPTV). [#To discuss]

1.49 “Subscription Pay TV” means the delivery and/or exhibition of a motion picture, television show or other entertainment product by any means of transmission to a television set or other viewing device by any technology (whether now known or hereafter devised) where the consumer is charged a recurring fee and/or periodic access charge for the right to receive a specified level of programming which is separate and distinct from, and in excess of, any subscription fees charged in relation to Basic TV, and which exhibits continuous, linear regularly-scheduled programming

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on a daily basis. Notwithstanding anything to the contrary contained herein, the delivery of content on Subscription Pay TV by means of Internet simulcast shall be only on an authenticated basis (i.e., where access is pre-conditioned on a consumer’s existing, authenticated subscription to the closed system Subscription Pay TV service).

1.50 “Subscription Video-On-Demand” or “SVOD” shall mean the delivery of multiple programs to a subscriber in response to the request of such subscriber (i) for which the subscriber is charged a recurring fee and/or periodic (e.g., monthly) fee for the right to receive such programming, and is not charged a per-program(s) or per-exhibition(s) fee, (ii) the exhibition start time of which is at a time specified by the subscriber in its discretion, and (iii) which may (subject to clauses [#]) or may not be advertising supported. [#Paul discussing the history of ad support of service. Clause now as per UK agmt where may or may not be ad supported.]

1.51 “SVOD Service” shall mean the Subscription Video-On-Demand programming service branded “Netflix” (or successor brand) at all times during the Term, 100% owned and operated by Licensee, and made available via Approved Delivery only to Registered Users in the Territory to Approved Devices (for exhibition on each such Approved Device’s associated video monitor in a format designed for viewing on such video monitor); provided that non-Registered Users may access certain limited portions of the SVOD Service, such as Clips, Promotional Previews, box art and synopses, it being acknowledged and agreed that non-Registered Users may not playback Included Programs from the SVOD Service.

1.52 “Tablet” shall mean any 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: Windows 8, iOS, Android, WebOS or RIM’s QNX Neutrino, subsequent versions of any of these, and other operating systems agreed in writing with Licensor (each, a “Permitted Tablet OS”) Tablet shall not include Zunes, Personal Computers, game consoles (including Xbox Consoles), set-top-boxes, portable media devices, PDAs, mobile phones or any device that runs an operating system other than a Permitted Tablet OS.

1.53 “Taxes” shall mean all federal, state, local, foreign and other net income, gross income, gross receipts, sales, use, value added, goods and services, ad valorem, transfer, franchise, profits, withholding, payroll, excise, stamp, real or personal property, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, but excluding any related penalties and interest, imposed by any federal, territorial, state, local, or foreign government or any agency or political subdivision of any such government. Sales, use, value added, goods and services, and similar taxes shall be referred to as VAT.

1.54 “Television Episode(s)” shall mean serialized broadcast television program episodes which Licensor makes available for license hereunder. Each Television Episode made available by Licensor and licensed by Licensee shall be an Included Program for all purposes of this Agreement.

1.55 “Television Series” or “TV Series” shall mean a single series of Television Episodes including all broadcast seasons thereof and may be designated as Current Series, Non-Returning Series, Library Series, or Animated Half Hour. [#To discuss House of Cards – amendment to this agmt.]

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Author, 08/31/12,

Please see revised House of Cards Letter

1.56 “Term” shall have the meaning assigned in Clause 3 hereof.

[1.57] “Territory” shall mean shall mean Sweden, Norway, Finland, Denmark (including without limitation Greenland), Faroe Islands and Aland Islands.and the respective territories, possessions, commonwealths, trusteeships, and protectorates of each.

[1.] “Territorial Breach” shall mean a Security Flaw that creates a reasonable risk that any of the Included Programs will be delivered to persons outside the Territory, where such delivery outside the Territory may result in actual or threatened harm to Licensor as a result of Licensee’s failure to comply with its obligations in Clause 4 of Schedule B. [# To discuss - Previously agreed and standard definition for Territorial Breach must be uniform across all agmts.]

1.57[1.58] “Theatrical Exhibition” shall mean the exhibition of a motion picture or programming (regardless of the means of delivery or mode of exhibition) in conventional or drive-in theatres open to the general public for which a fee is charged for admission. “Theatrical” has a correlative meaning.

1.58[1.59] “Usage Rules” shall mean those usage rules set forth on Schedule D attached hereto.

1.59[1.60] “VCR Functionality” shall mean the capability of a subscriber to perform any or all of the following functions with respect to the delivery of an Included Program: stop, start, pause, play, rewind and fast forward.

2. LICENSE.

2.1 Grant of License. Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee a limited non-exclusive license to transmit each Included Program for exhibition during its License Period solely in the Licensed Language and in the medium of Subscription Video-On-Demand on the SVOD Service to Registered Users in the Territory and subject at all times to the Usage Rules. Without limiting the foregoing, each such transmission of an Included Program shall be solely by Approved Delivery in an Approved Format to a Registered User’s Approved Device located in the Territory, subject to Licensee’s obligations set forth in Clause 4 of Schedule B, for exhibition on each such Approved Device’s associated video monitor in a format designed for viewing on such video monitor. In addition, for the avoidance of doubt, the foregoing license shall be limited to authorized exhibition for Personal Use. Licensee shall have the right to exploit the Subscription Video-On-Demand rights using VCR Functionality.

[2.2] Restrictions on License. Licensee agrees that it is of the essence of this Agreement that, without the specific written consent of Licensor, or except as otherwise set forth herein: (a) the license granted hereunder may not be assigned, licensed or sublicensed in whole or in part, nor may any Included Program be sub-distributed in any way, other than separate and apart from the technical distribution of the SVOD Service by third party contractors in accordance with clause 24; (b) no Included Program may be delivered, transmitted or exhibited other than as set forth in Clause 2.1; (c) except as otherwise provided for in Clauses 2.7 and 2.8 of Schedule B, each Included Program must remain in its approved level of resolution and not up-converted; and (d) no person or entity shall be authorized or permitted by Licensee to do any of the acts forbidden herein. Licensor reserves the right to conduct an initial inspection of and approve the picture quality and user experience of the SVOD Service within sixty (60)

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Author, 08/31/12,

As discussed earlier, we use different third party contractors (which we remain liable for) and this does not seem an unreasonable clarification. We are agreeing to revise many portions of the agreement per your comments for belts/suspenders, and we ask that you likewise make reasonable accommodations for belts/suspenders.

days of the Launch Date. Thereafter, when Licensee makes any modification that results in a material adverse change to the picture quality and user experience of the SVOD Service, Licensee shall so notify Licensor, and Licensor shall have the right to inspect and approve such modified picture quality and user experience. Licensee shall immediately notify Licensor of any unauthorized transmissions or exhibitions of any Included Program of which it becomes aware. Notwithstanding anything to the contrary in this Agreement, including without limitation this Clause 2.2, Licensee shall be permitted to offer the SVOD Service, including the Included Programs licensed hereunder, on Approved Devices via Approved Delivery where a Registered User must use a third party software or service (including without limitation an Application) and/or make payment to a third party to access the SVOD Service (e.g., pay an additional charge or subscription fee to a service provider in order to access the bundled service that provides the ability to subscribe to the SVOD Service) (“Third Party Fees”); provided that Licensee represents and warrants that it shall not receive any portion of such Third Party Fees at any time and provided, further, that such Third Party Fees are not charged on a transactional video-on-demand or per-view basis. Such third parties may also offer interactive features, such as chat functionality or other communication features, that overlay the SVOD Service but are not initiated by Licensee. By way of example only, the SVOD Service may be offered through a game console such as the Sony PlayStation 3 or Microsoft Xbox, wherein access to the SVOD Service by Registered Users through such Approved Device requires the payment of a Third Party Fee to Sony Corporation of America or Microsoft Corporation (in addition to subscription fees billed by Licensee) for access to the SVOD Service or a tier of or bundled service that includes the SVOD Service.

2.3 Reservation of Rights. All licenses, rights and interest in, to and with respect to the Included Programs, the elements and parts thereof, and the media of exhibition and exploitation thereof, not specifically granted herein to Licensee, shall be and are specifically and entirely reserved by and for Licensor. Without limiting the generality of the foregoing, each of Licensor and Licensee acknowledges and agrees:

(a) that Licensee has no right in the Included Programs or the images or sound embodied therein, other than the right to exhibit the Included Programs in strict accordance with the terms and conditions set forth in this Agreement;

(b) that this Agreement shall not grant to Licensee or any other person or entity any right, title or interest in or to the copyright or any other right in the Included Programs, nor any ownership or other proprietary interests in the Included Programs;

(c) that for the avoidance of doubt without the prior written approval of Licensor, the fee charged for the SVOD Service is unaffected in any way by the purchase of other programs, products or services; and [# To discuss -Re-instated as previously agreed and material deviation to basis of agmt.]

(cd) that Licensor retains the right to fully exploit the Included Programs and Licensor’s rights in the Included Program’s without limitation or holdback of any kind, except as set out herein, whether or not competitive with Licensee. [#There are no restrictions elsewhere in the Agmt.]

2.4 Fraud Detection. Licensee shall consistently track information indicating fraudulent viewing and distribution activity on the SVOD Service, including, without limitation,

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license issuances by Registered User and IP address, device registration and de-authorization, customer ID’s, play data and number of current streams by Registered User and review its procedures with Licensor from time to time.

[2.5] Notice of Hardware Devices: Licensee agrees that on the reasonable request of Licensor from time to time, Licensee shall supply an updated list of Hardware Devices and Applications within a reasonable time period. [#Re-instated with reference to “Applications” added.] [#Discussed with Josephine – Netflix consider that this creates an unnecessary burder on their limited resources when we can find this information out for ourselves. She explained that device info is available on the website in the section that explains to users how they can access content. I asked whether it also referred to all applications. Josephine is going to find out how it is we can get this information for ourselves.]

3. TERM. Subject to earlier termination pursuant to the terms of this Agreement, the period during which Licensor shall be required to make Included Programs available and Licensee shall be required to license Included Programs pursuant to this Agreement shall be the period starting on 15th October 2012 and ending 31st December 2015 (“Avail Term”). The fourteen and one-half (14½) month period beginning on 15 th October 2012 and ending on 31st December 2013 is “Avail Year 1,” the twelve month period beginning on 1st January 2014 and ending on 31st December 2014 is “Avail Year 2”, the twelve month period beginning on 1st January 2015 and ending on 31st December 2015 is “Avail Year 3” (each of Avail Year 1, Avail Year 2 and Avail Year 3, an “Avail Year”). In no event shall Licensee have the right to exploit any Included Program prior to the commencement of the Avail Term or its License Period or after the end of its License Period. Each party acknowledges that the License Period for an Included Program may expire after the end of the Avail Term. The “Term” of this Agreement shall commence on the Effective Date and expire on the last day of the last License Period to expire for an Included Program licensed hereunder. Notwithstanding the foregoing, no termination or expiration of this Agreement, howsoever occasioned, shall relieve either party hereunder of any obligations that are expressly or impliedly created before or that expressly or impliedly continue after any such termination or expiration hereof.

4. AVAILABILITY DATE; LICENSE PERIOD.

4.1 Availability Date. The Availability Date for each Included Program shall be as determined by Licensor in its sole discretion and, in any event, in accordance with the below:

Program type

Availability Date

Library Features

Theatrically released Library Feature Films/ Library DTVs/ Library MOWs: -Avail Year 1 – as per Schedule A; -Avail Years 2 and 3 – as determined by Licensor.

Current Series

The most recent season of a Current Series must be no more than 24 36 months after the first broadcast in the Territory of the first episode in that season on any form of television (Free TV/Basic TV/Subscription Pay TV). The Availability Dates for Avail Year 1 Current Series are set out inon Schedule A

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Author, 08/29/12,

Accepted original language

are set forth thereon. [#36 mths has been agreed]Non-Returning Series

As determined by Licensor. The Availability Date for Avail Year 1 Included Programs on Schedule A are set forth thereon.

Library Series


Animated Half Hour


4.2 License Period

4.2.1 The License Period for each Included Program shall commence on its Availability Date and shall expire according to the table below:

Program type License PeriodLibrary Feature 14½ months for Avail Year 1,

12 months for Avail Year 2 and Avail Year 3; provided, however, Licensor may determine a License Period of 6 months (or 7¼ months for Avail Year 1) subject to Clause 5.2.1(c)

Television Series 14½ months for Avail Year 1, 12 months for Avail Year 2 and Avail Year 3; unless otherwise set forth on Schedule A

4.2.2 “Holdbacks” shall apply as set out below: Licensor shall make available each Library Feature and TV Series on the basis that each is non-exclusive and no holdbacks shall apply.

5. LICENSING COMMITMENT; SELECTION.

[5.1.] Launch Pack. Subject to Licensor’s delivery of the Included Programs in Launch Pack in accordance with the terms of this Agreement, for Avail Year 1, Licensee shall (in addition to the Annual Commitment for Avail Year 1 set out in clause 5.2 below) license the titles listed in the Launch Pack set out in Schedule A1 . [#TBC]

[5.2.] In addition, for each Avail Year during the Term, Licensee shall select and license, subject to availability lists being furnished by Licensor in accordance with Clause 5.45.2,5.4, a volume of Included Programs in accordance with the following, to the extent made available by Licensor:

5.1.1.[5.2.1.] Library Features :

(a) A minimum of ninety (90) Library Features per Avail Year made up of the following minimum numbers per tier to the extent made available by Licensor as set out in the table below:

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Avail Year Total

Tier A Tier B Tier C

1 90 20 35 35

2 90 20 35 35

3 90 20 35 35

(b) The categorization of the tiering is to be agreed in good faith between the parties.

(c) In the case of a Library Feature only having a License Period of six (6) months (or 7¼ months for Avail Year 1), Licensee shall license an additional title with a License Period of six (6) months (or 7¼ months for Avail Year 1). Where the License Period for a Library Feature is six (6) months (or 7¼ months for Avail Year 1), the License Fee for such Library Feature shall be fifty percent (50%) of the License Fee set out in Schedule A.

5.1.2.[5.2.2.] Library DTV/MOWs : A minimum of seven (7) across Library DTV/MOWs per Avail Year.

5.1.3.[5.2.3.] Television Series :

(a) Licensee shall license a volume of episodes of Television Series such that the total value of the License Fees for Television Series in the aggregate shall be no less than (each, an “Annual Television Spend”):

Avail Year Annual Television Spend (USD)

Avail Year 1 $2,045037,000

Avail Year 2 $2,940607,000

Avail Year 3 $2,867,700

provided that in any event, (i) Licensee shall license a minimum of 250 episodes (in the aggregate) across all Television Series per Avail Year, and (ii) at least 25% of the value of each Annual Television Spend shall be comprised of Library Series. [#Andreas to update numbers.]

5.2.[5.3.] With respect to Avail Year 1, Licensor shall make available, and Licensee shall license, the Included Programs set forth on Schedule A which shall count towards the minimum licensing commitments set forth above for Avail Year 1.

[5.4.] Availability Lists; Availability Date Notice; Selection. Licensor shall furnish Licensee with Availability Lists, which shall include Availability Dates, for all product categories at least 150 calendar days prior to commencement of each Avail Year 2 and Avail Year 3. [#Additional time needed because of requirement to create sub-titles for all Included Programs] Licensor may, by providing written notice to Licensee, modify the Availability Date of any title(s) (other than the Avail Year 1 Availability List and Launch Pack) up to the date that is sixty (60) days prior to the specified Availability Date of such title(s), provided that in any event any such modified Availability Date(s) shall (i) still be subject to the parameters set forth in Clause 8.1.1. [#Re-instated.][# Discussed with Josephine – as this this all Library Films this should not be required. I agree given the definition of Library Titles

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(10yrs+) and think we can agree to the deletion. If we add currents or indeed House of Cards, we will need to add something back in here.] Availability Lists for Library Features, Current Series, Non-Returning Series and Library Series shall include at least one hundred twenty-five percent (125%) of the volume obligations set forth above of same, from which Licensee may select, and shall be of comparable type and quality to the titles made available by Licensor for Avail Year 1 (e.g., box office receipts, age, genre, etc.). Licensee shall make its selections for each Avail Year no later than thirty (30) calendar days following Licensor’s delivery of such Availability Lists.

6. WITHDRAWAL OF PROGRAMS.

[6.1] 6.1 Licensor may withdraw any Included Program or related materials at any time because of (a) an Event of Force Majeure, loss of rights, unavailability of necessary duplicating materials or any pending or threatened litigation, judicial proceeding or regulatory proceeding or in order to minimize the risk of liability in connection with a rights problem with such program, or (b) upon ninety (90) days’ prior written notice, if Licensor elects to theatrically re-release or reissue such program or make a theatrical, direct-to-video or television remake or sequel thereof, or such program is placed on DVD moratorium in the Territory (except in the case of a re-release, re-issue, remake or moratorium in the Territory, in which case thirty (30) days’ prior written notice shall be sufficient). For any Included Program withdrawn pursuant to this Clause 6.1, Licensor shall provide a mutually agreed upon comparable replacement, or refund to Licensee or credit against Licensee payables within sixty (60) calendar days of the effective date of such withdrawal, a pro rata amount of all License Fees paid to Licensor for withdrawn Included Programs for which the License Period has not begun or has not expired, such pro rata amount to be calculated based upon the percentage of the applicable License Period for each such Included Program that remains as of the effective date of such withdrawal.

[#Delete rest of 6.2 as well? i.e. to revert to UK position – no withdrawal rights for Licensee.]

6.1[6.2] Withdrawal by Licensee.

[6.2.1] Notwithstanding anything to the contrary in this Agreement, Licensee shall have the right to temporarily suspend or permanently withdraw any Included Program (or one or more episodes of the same) from the Licensee Service at any time for any reason. Such suspension or withdrawal by Licensee pursuant to this Clause 6.2 (i.e. – a suspension or withdrawal by Licensee that is not a Removal for Cause, as defined below in Clause 6.2.2) shall not relieve Licensee of its payment obligations hereunder.

[6.2.2] Without limiting the foregoing, in the event Licensee temporarily suspends or permanently withdraws any Included Program or one or more episodes of the same from the Licensee Service because of its reasonable, good faith determination, that continued distribution of such Included Program or episode or performance of its obligations under this Agreement may create material legal or regulatory liability for Licensee (a “Removal for Cause”), Licensor shall refund to Licensee or credit against Licensee payables, at Licensee’s option and within thirty (30) calendar days of the effective date of such temporary suspension or permanent withdrawal, a pro rata amount of all License Fees paid to Licensor for withdrawn Included Programs (or episode)

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for which the License Period has not begun or has not expired, such pro rata amount to be calculated based upon: (i) in the case of a permanent withdrawal, the percentage of the applicable License Period for each such Included Program that remains as of the effective date of such withdrawal and (ii) in the case of a temporary suspension, from the effective date of such suspension, based upon the amount of time of such suspension. In the event of a Removal for Cause or Licensor’s withdrawal of one or more episodes of any Included Program(s) (“Withdrawn Episode”), Licensee shall be entitled, in its sole and absolute discretion, to temporarily suspend or permanently withdraw the Season(s) of the Included Program that contained such episode(s) (a “Withdrawn Season”), and shall be entitled to a pro rata refund or credit against Licensee payable, at Licensee’s option, for such Withdrawn Season(s) of the Included Program in accordance with this Clause 6.2.2; provided, however, that the season may only be withdrawn if it is a series that has a continuous, sequential storyline. The Removal of Cause of one or more episodes of any Included Program that are each “stand-alone” episodes of a non-serialized Title shall not give rise to Licensee’s right to withdraw of the entire season of such Included Program.

[6.3] In the event of a Withdrawn Season of any Included Program(s), Licensee shall be entitled, at any time and in its discretion, to temporarily suspend or permanently withdraw all other or remaining Seasons of the Included Program. Licensor shall refund to Licensee or credit against Licensee payables, at Licensee’s option and within thirty (30) calendar days of the effective date of withdrawal, a prorated amount of the relevant License Fee paid to Licensor for all such Withdrawn Seasons, such pro rata amount to be calculated from the effective date of withdrawal and based upon the amount of time remaining in the relevant Included Program License Period(s).

[7.] LICENSE FEE; PAYMENT.

[7.1] License Fee. In consideration of the rights granted hereunder and subject to Clauses 4 and 5, for each Included Program delivered in accordance herewith, Licensee shall pay to Licensor a license fee determined in accordance with this Clause 7 for the Included Programs licensed by Licensee hereunder as set forth on Schedule C attached hereto, allocated among the four countries of the Territory in accordance with Schedule C (each, a “License Fee”). The License Fee specified herein is expressed in US Dollars. [#Allocation between Territories in this way has not been agreed. Delivery problems, if any, can be rectified independently of payment process.]

[7.2] Payment Terms: Subject in each instance to Clause 8, each License Fee for Included Programs shall be due and payable in equal quarterly installments over the duration of the License Period for the applicable country of the Territory, with the first such quarterly payment due on the 15th day of the calendar month immediately following such Included Program’s Availability Date for the applicable country of the Territory and each subsequent quarterly payment due on the 15th day of the first month of each calendar quarter thereafter for the applicable country of the Territory. By way of example only, if the License Fee for Included Program A is $15,000 for a country in the Territory, the License Period is 12 months, and the Availability Date is February 1, 2011, Licensee shall pay the License Fee as follows: in four (4) equal installments of $3750 each, with the first due and payable on March 15, 2011, the second due and payable April 15, 2011, the third due and payable July 15, 2011, the fourth due and

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payable October 15, 2011. The parties acknowledge and agree that the provisions of this Clause 7 are of the essence. Licensee covenants and agrees to make all payments to Licensor hereunder in a timely manner. Without prejudice to any other right or remedy available to Licensor, any late payment will bear interest accruing from its due date at a rate equal to the lesser of 2% above the prime rate of interest announced by Barclays Bank at such time per year and the maximum rate permitted by applicable law.

7.1[7.3] Taxes. The amounts to be paid by Licensee under this Agreement shall include all taxes. The parties agree that no VAT will be charged or collected pursuant to the reverse-charge mechanism under the EU VAT Directive. If any Taxes are required by applicable law to be collected by Licensor from Licensee, Licensor shall promptly provide Licensee with a valid tax invoice that fully meets the requirements of the taxing authority of the region in which such Taxes are due. Each party shall indemnify the other for failure to pay any Taxes payable by such party pursuant hereto and/or applicable law.

7.2[7.4] Withholding Taxes. Licensee may withhold from its payments to Licensor any Taxes required to be withheld by applicable law unless Licensor provides Licensee with documentation sufficient to verify that Licensor is eligible for a reduced rate of withholding pursuant to the Luxembourg-United Kingdom Tax Treaty. Licensee shall (i) remit legally required amount from payment to Licensor to the applicable taxing authority, and (ii) deliver to Licensor original documentation or a certified copy evidencing such remittance to permit Licensor to obtain a credit or withholding in respect of such amounts withheld (a “Withholding Tax Receipt”). In the event Licensee does not provide a Withholding Tax Receipt in accordance with the preceding sentence, the Licensee shall be liable to and shall reimburse Licensor for the withholding Taxes deducted from payments due Licensor.

7.5 Pursuant to the Double Taxation Convention between Licensor’s country and Licensee’s country, Licensor shall apply for an exemption from or reduction of withholding tax pursuant to such Double Taxation Convention and shall be responsible for delivering to Licensee appropriate documentation (such as a Certificate of Fiscal Residence, if required pursuant to the applicable Double Taxation Convention); provided that Licensee shall provide to Licensor all assistance, documentation and information reasonably required for Licensor to obtain such exempt or reduced withholding.

7.6 Other Taxes. Except as otherwise provided in this Agreement, Licensee shall be solely responsible to determine, collect, bear, remit, and pay, and shall hold Licensor forever harmless from and against, any and all Taxes (including interest and penalties on any such amounts, but other than Licensor’s corporate income and similar taxes), payments, or fees required to be paid to any third party now or hereafter imposed or based upon the importation, licensing, rental, delivery, exhibition, possession, or use hereunder to or by Licensee of the Included Programs, Created Masters, or Advertising Materials, or any print or any Copy thereof.

7.7 Payment Direction. Unless and until Licensee is otherwise notified by Licensor, all payments due to Licensor hereunder shall be made in US Dollars by wire or ACH transfer to Licensor as follows:

Bank Name JPMorgan ChaseBank Address 1 Churchill Place, London

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Swift Code CHASGB2LAccount Number 41224502IBAN GB36CHAS60924241224502

7.[8.] PHYSICAL MATERIALS AND TAXES.

8.1. Delivery

[8.1.1.] The Parties agree that where an English language version Copy (as defined below) has already been delivered (or otherwise provided) to Licensee (e.g., pursuant to any other agreement between Licensee and any affiliate of Licensor) that complies with the Technical Specification, Licensee may at Licensee’s discretion use the same Copy for the purposes of this Agreement., and Iin such event, Licensee shall so notify Licensor, delivery shall be deemed to have occurred under this Agreement and Licensor shall not be required to re-deliver the relevant source materials to Licensee to effectuate delivery and acceptance hereunder. [#Normally we decide as in some cases, it may be that a different version is required for a different territory so they may not be able to re-use what they have.]

[8.1.2.] Where an English language version Copy (as defined below) is deemed delivered in accordance with Clause 8.1.1 above, Licensor shall also deliver in accordance with the Technical Specification below, a separate sub-title, and where available, a dub in each Licensed Language, along with all other local materials set forth in and in compliance with the Technical Specification (e.g., artwork, trailers, metadata, Advertising Materials), by no later than sixty (60) days prior to the Availability Date for each Included Program, unless mutually agreed otherwise by the parties. The parties agree that for any Included Program for which the Availability Date is less than ninety (90) calendar days after the Effective Date, Licensee shall, subject to the following sentence, receive materials as soon as practicable and in any event no later than 17 September 2012the date of this Agreement. Copies of delivery materials for Justified (Seasons [#]) and Drop Dead Diva (Seasons [#]) shall be delivered as soon as reasonably possible and in any event by no later than 15 October 2012. [#Advertising materials, etc are made available by website and are not delivered as part of the materials delivery process. Such materials are available for access by Licensee at all times, subject to the restrictions on timing of use by Licensee as set out in cl [#] of the agmt.]

8.1.1. Copies. Except for an Included Program delivered in accordance with where Clauses 8.1.1 and 8.1.28.1.1 applies, Licensor shall provide all source materialsa copy for each Included Program as set forth in and in compliance with the “Technical Specification” set out in Schedule E (each digital file, a “Copy”) together with subtitles in all Licensed Languages (and where available, dubbed in any or all of the Licensed Languages) in the highest quality and resolution available to Licensor or its affiliates (including, without limitation, HD and 3D). [#“Highest quality” is subjective. The tech spec is objective, noting also that we are not delivering in 3D.] Licensor shall deliver such materials by sixty (60) days prior to the Availability Date for each

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Included Program unless mutually agreed otherwise by the parties. The parties agree that for any Included Program for which the Availability Date is less than ninety (90) calendar days after the Effective Date, Licensee shall receive materials as soon as practicable and in any event no later than 17 September 2012the date of this Agreement. Subject to Licensor’s timely delivery in compliance with the Technical Specification, Licensee shall reimburse Licensor the applicable amount set forth in Schedule E (the “Conforming and Delivery Costs”) associated with the conforming of subtitle tracks, conforming of dub tracks (as applicable), transcoding of video file and delivery of final files for each Included Program, which shall be due and payable by Availability Date. For clarity, with respect to any Included Programs added to Schedule A after the date hereof (e.g., via amendment), the Conforming and Delivery Costs shall not apply. The parties hereto acknowledge and agree that this provision is agreed to on a one-time only, non-precedential basis. For each Included Program delivered by Licensor to Licensee whose original language is not a Licensed Language, Licensor shall deliver to Licensee such original language version subtitled in each Licensed Language, and if available dubbed, in each Licensed Language. [#Note that as per comment in previous draft, the agmt is now silent on Netflix making further copies for its own purposes. How many copies will Netflix need to make so we can add a clause addressing this?]

[8.1.3.] Without limiting Licensor’s delivery obligations, if Licensor does not provide dubbed and/or subtitled versions of an Included Program pursuant to the previous clauses, then Licensee shall upon request [#To avoid duplication of effort, sub-titled/dubbed versions should be upon request so that we are made aware of what Netflix is creating.] have the right to create, at Licensee’s sole cost, subject to any third party contractual restrictions of which Licensee has received notice, a subtitled version of such Included Program in the Licensed Language (including translations of synopses, titles, etc.). All rights, including copyrights and trademarks, in such subtitled versions of the Included Programs licensed hereunder, shall vest in Licensor upon creation thereof, subject only to any third party rights therein and the rights granted herein to Licensee hereunder during the Term hereof. Licensee acknowledges and agrees that Licensee is not granted and is not acquiring any ownership rights in or of, or interest in, any copy, Included Program or subtitled version of an Included Program by reason of Licensee’s permitted use or manufacture thereof. Upon request, Licensee’s rights in any such sub-titled versions shall be assigned on a quit-claim basis to Licensor provided that Licensor reimburses Licensee for one hundred percent (100%) of the actual costs incurred in the creation of such subtitled version as evidenced in writing. In the event of any such assignment, Licensee shall deliver (free of any delivery charge) to Licensor copies (or access to copies) of all such requested subtitled versions created by Licensee. [#Sony – consider deleting second upon request and changing first reference to “notify in advance” to ensure no duplication of effort. Rights in sub-titled versions should vest to us immediately upon creation.]

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8.1.2.[8.1.4.] Notwithstanding the foregoing, Licensee’s obligations to assign, deliver (or provide access to) any subtitled files shall at all times be subject to any third party rights and restrictions with respect thereto. In connection with the creation of any subtitled version (not including the underlying Included Program) by Licensee or its agents, Licensee shall be responsible for obtaining all necessary third party rights, consents and clearances of which it has received written notice with respect thereto and Licensee shall indemnify Licensor for any claims arising from Licensee’s exploitation of such subtitled version to the extent that such claims result from Licensee’s failure to obtain such rights, consents or clearances.

[8.1.5.] Advertising Materials. For each Included Program, Licensor shall make available deliver to Licensee at least sixty (60) days prior to the applicable Availability Date all available Advertising Materials (defined below) via access to Licensor’s website at www.spti.com (or any successor website) and music cue sheets with respect to such Included Program via access to Licensor’s website at https://euconnect.spe.sony.com/spidr (or any successor website). The parties agree that for any Included Program for which the Availability Date is less than sixty (60) calendar days after the Effective Date, delivery hereunder shall be made as soon as practicable. [#All these materials are made available from these sites which should be accessed by Licensee – subject always to restrictions on timing of advertising based on licence period.]

[8.2.] [intentionally omitted]

8.2.[8.3.] Return. Within 30 days following the later of (a) the termination or expiration of this Agreement and (ii) the last day of the License Period with respect to each Included Program, Licensee shall at Licensor’s election either return all Copies to Licensor or to a Licensor-designated facility or laboratory or erase or degauss all such Copies and supply Licensor with a certification of erasure or degaussing of such Copies. [#See comment above re whether Netflix makes additional copies. Amend as required to address such additional copies.]

8.3.[8.4.] Loss, Theft, Destruction. Upon the loss, theft or destruction (other than as required hereunder) of any Copies of an Included Program, Licensee shall promptly furnish Licensor with proof of such a loss, theft or destruction by affidavit setting forth the facts thereof. [#See comment above re whether Netflix makes additional copies. Amend as required to address such additional copies.]

8.4.[8.5.] Licensor’s Property. Each Copy of the Included Programs and all Advertising Materials are the property of Licensor, subject only to the limited right of use expressly permitted herein, and Licensee shall not permit any lien, charge, pledge, mortgage or encumbrance to attach thereto. [#See comment above re whether Netflix makes additional copies. Amend as required to address such additional copies.]

8.5.[8.6.] RATINGS [#This is going to be a contentious issue. What local ratings if any exist for the Nordics. Note also comment from Netflix that qualitative research shows users consider it strange when US ratings are shown – too US centric.]

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https://euconnect.spe.sony.com/spidr

http://www.spti.com/

[8.6.1.] Licensor shall informally advise provide (as part of the materials provided in Clause 8.1.2 or 8.1.3, as applicable) Licensee applicable theatrical and/or home entertainment ratings (and/or any other content classification information)with US MPAA ratings for Included Programs (where available) for Licensee’s general reference and use for the SVOD Service, it being acknowledged by the parties that such theatrical/home entertainment ratings (which are not applicable to online exploitation) may also be proprietary to the issuing classification body. Any use by Licensee of such proprietary ratings shall be as between Licensee and the relevant classification body. [#To confirm – we won’t be supplying any local ratings at all? Even if we have them? If so, I can delete the last part I have added back in.]

8.5.1.[8.6.2.] Where no advisory information is provided by Licensor with respect to any Included Program with the initial delivery of such Included Program, Licensee shall have the right (subject to applicable law) to apply its own rating to such Included Program (and, at Licensee’s discretion, such rating may be an “unrated” or “not rated” rating, or, at Licensee’s option, Licensee shall have the right to instead not assign a rating to such Included Program in Licensee’s discretion). In the event Licensor reasonably disagrees with such rating (if any), the parties shall discuss such rating in good faith. Licensee shall update any rating which the parties mutually agree should be changed.

[8.6.3.] In the event that a compulsory content classification body (“Compulsory Regime”) is established within the Territory applicable for content distributed by means of SVOD via Approved Delivery, either party shall provide written notice to the other party and the parties agree to discuss in good faith the implementation (if applicable) of such Compulsory Regime in the context of distribution of the Included Programs hereunder. Where no agreement is reached in relation to the implementation of the Compulsory Regime within thirty (30) days of such aforementioned notice, either party shall have the right but not the obligation to withdraw such affected Included Program(s), and Licensor shall have no obligation to supply and Licensee shall have no obligation to license the relevant Included Program(s) and Licensor shall refund to Licensee (or credit against Licensee’s payables hereunder), a prorated amount of the relevant License Fee(s) for such Included Program(s) paid to Licensor.

8.5.2.[8.6.4.] If, at any time during the Term, the relevant ratings body applicable under a Compulsory Regime issues updated rules or otherwise requires the display of rating information for SVOD content in a manner different than previously required then either party shall provide written notice to the other party of such new requirements and the parties shall discuss in good faith the implementation (if applicable) of such updated rules. Where no agreement is reached in relation to thereto within thirty (30) days of such aforementioned notice, either party shall have the right, but not the obligation, to withdraw the affected Included Program(s), Licensor shall have no obligation to supply and Licensee shall have no obligation to license the relevant Included Program(s), ) and Licensor shall refund to Licensee (or credit against Licensee’s payables hereunder), a prorated amount of the relevant License Fee(s) for such Included Program(s) paid to Licensor. [#Sony – to discuss further. Consider agmt to removal of “non-compulsory” references.

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Netflix wants to avoid wording that seeks to restrict its ability to withdraw from a non-compulsory scheme. I explained the wording does not do that. To discuss right of credit of licence fees where we fail to supply rating as part of a compulsory schedule. Explained that we consider such services to be analogous to the TV distribution business where it is the broadcaster who is responsible for ratings. Also explained that this part of the business is a b2b business and we do not as a matter of practice obtain ratings. Said there are no exceptions to this clause with any distributor – we do not take on responsibility for ratings. Netflix consider it is only us as the content owner that is capable of determining ratings –Netflix is not in a position to determine ratings. They will not take responsibility for them and in the event we don’t supply, they will require a refund. I said I would discuss internally the possibility of refund only applying in the event of a compulsory scheme that required us to supply and we failed to supply – ie limited right only where it is our responsibility by law and we don’t meet it. GPC will find out what ratings system is used in the Nordics for digital distribution.]

8.[9.] CONTENT PROTECTION & SECURITY.

[9.1.] General. Licensee shall, throughout the Term, maintain the security systems, procedures and technologies (including, without limitation, Content Protection Systems) that are no less stringent or robust than those which Licensee employs with respect to licensed films from other licensors, but in no event less than industry standard, in each case in the Territory. [# Given centralized infrastructure, content protection technology used would be the same globally. Using different DRMs in different territories does not create a different standard as the different Approved Formats all meet the same standard.] As of the Effective Date, Licensee represents and warrants that it implements, and will continue to implement throughout the remainder of the Term, the systems, procedures and technologies set forth on Schedule B and Schedule D. Subject to the foregoing, Licensee shall maintain and upgrade such security systems, procedures and technologies (including, without limitation, encryption methods) as necessary and commercially reasonable to prevent theft, pirating, unauthorized exhibition (including, without limitation, exhibition to non-Registered Users and exhibition outside the Territory), unauthorized copying or duplication of any video reproduction or compressed digitized copy of any Included Program. In the event Licensor embeds, encodes or otherwise inserts, or if applicable, associates copy control information in or with the Included Programs prior to delivery to Licensee, Licensee shall “pass through” such copy control information without intentional alteration, modification or degradation in any manner. Licensee shall not authorize any use of any video reproduction or compressed digitized copy of any Included Program for any purpose other than as is expressly permitted herein. Licensor or its representative shall have the right, at a time and date to be mutually agreed upon, to conduct an initial inspection and review Licensee’s security systems, procedures and technologies at Licensee’s places of business (including off-site facilities, if any, used by Licensee) within sixty (60) calendar days of the Launch Date. Thereafter, when Licensee makes any material and negative modification to its security systems, procedures and technologies, Licensee shall so notify Licensor, and Licensor shall have the right, at a time and date to be mutually agreed upon, to inspect

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Author, 08/31/12,

Per our technical team, there are territorial nuances. For example, DRM availability is not the same in every territory (eg, Marlin may be industry standard in certain countries while WMDRM is in others). We are still obligated to the security obligations in Schedule B in any event.

and review such modified security systems, procedures and technologies at Licensee’s affected places of business (including off-site facilities, if any, used by Licensee).

[9.2.] Suspension Notice. Licensee shall notify Licensor immediately upon learning of the occurrence of any Security Breach or Territorial Breach, and shall provide Licensor with specific information describing the nature and extent of such occurrence. Licensor shall have the right to suspend the availability (“Suspension”) of the Included Programs on the SVOD Service at any time during the Avail Term in the event of a Security Breach or Territorial Breach by delivering a notice to Licensee of such suspension (“Suspension Notice”). Upon receipt of a Suspension Notice, Licensee shall take steps immediately to remove the Included Programs or make the Included Programs inaccessible from the SVOD Service as soon as commercially feasible (but in no event more than three (3) calendar days after receipt of such notice). The parties acknowledge that a Suspension pursuant to this Clause 9.2 may be occasioned in the absence of a Licensee Event of Default (e.g., in the event the DRM is hacked through no fault of Licensee), and that in such event, (i) no further rights or obligations shall accrue on the part of either party after such a Suspension with regard to such Suspension [#As per previously agreed clause.], (ii) Licensor shall not discriminate against Licensee with respect to initiating Suspension as compared to other distributors of Licensor’s content, and (iii) Licensor shall refund to Licensee or credit against Licensee payables, at Licensee’s option and within thirty (30) calendar days of the date such Suspension, a prorated amount of all License Fees paid to Licensor, such pro rata amount to be calculated as of the date of such Suspension Notice. [#Consider accepting part added in green which I have for now deleted.]

[9.3.] Reinstatement/Termination. If the cause of the Security Flaw that gave rise to a Suspension is corrected, repaired, solved or otherwise addressed in the sole judgment of Licensor, the Suspension shall terminate upon Licensor’s delivery to Licensee of a notice thereof (“Reinstatement Notice”) and Licensor’s obligation to make the Included Programs available on the SVOD Service shall resume. For clarity, no period of Suspension shall extend the Avail Term in time, and upon a notice that a Suspension has ended, the Avail Term shall end as otherwise provided herein. As soon as practicable after the delivery of a Reinstatement Notice to Licensee, Licensee may include the Included Programs on the SVOD Service. If more than two Suspensions occur during the Avail Term for any reason under any provision of this Agreement, or any single Suspension lasts for a period of three months or more, Licensor shall have the right, but not the obligation, to terminate this Agreement by providing written notice of such election to the Licensee. [#As per previously agreed clause.], provided that Licensor shall refund to Licensee or credit against Licensee payables, at Licensee’s option and within thirty (30) calendar days of the date such termination, a prorated amount of all License Fees paid to Licensor, such pro rata amount to be calculated as of the date of the expiration of the relevant cure period.

8.1.[9.4.] Obligation to Monitor. Licensee shall have the obligation to notify Licensor promptly of any Security Breaches or Territorial Breaches of which it becomes aware.

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8.2.[9.5.] Content Protection Requirements and Obligations. Licensee shall at all times strictly comply with the Content Protection Requirements and Obligations attached hereto as Schedule B and incorporated herein by this reference.

[10.] CUTTING, EDITING AND INTERRUPTION. Subject to Clause 11.2, Licensee shall not make, or authorize any others to make, any modifications, deletions, cuts, alterations or additions in or to any Included Program without the prior written consent of Licensor. For the avoidance of doubt, no panning and scanning, time compression or so-called “up-conversion” (except as stated in Clause 2.7 of Schedule B) and similar modifications shall be permitted. Without limiting the foregoing, Licensee shall not delete the copyright notice or credits from the main or end title of any Included Program or from any other materials supplied by Licensor hereunder. No exhibition of any Included Program hereunder shall be interrupted for intermission, commercials or any other similar commercial announcements of any kind (namely no pre/mid/post roll advertising nor shall any advertising be displayed on the same page/window of the SVOD Service from which the Included Program is viewed). Notwithstanding anything to the contrary in this Clause 10, Licensee shall not be responsible for any third party modifications to Included Programs or overlays that obscure or otherwise interact with Included Programs and result from Registered User’s use of his or her Approved Device and/or from the operation of any third party hardware and/or software and are not initiated by Licensee (collectively, “Program Overlays”); provided that (i) Licensee shall include in its terms of service with third parties who develop Applications a requirement that any Program Overlays conform to industry standard, (ii) no Program Overlay may alter or modify the Usage Rules, and (iii) if Licensee becomes aware of any third party implementing a Program Overlay in an Included Program in violation of the applicable terms of service, Licensee shall use reasonable means to address such violation and/or, in its reasonable discretion, revoke such third party access to the Included Programs and/or SVOD Service. For the purpose of this Agreement, “industry standard” with respect to Program Overlays shall constitute those modifications or overlays implemented by (i) Comcast, Xfinity, StreamPix, TiVo, Xbox or PlayStation (but solely with respect to overlays implemented within each such entity’s subscription or ad-supported video programming service) or any other ad-supported or subscription video programming service delivered over multichannel video programming distributors with respect to similarly situated content, or (ii) Hulu, Crackle or any other ad-supported or subscription video programming service delivered over the Internet with respect to similarly situated content. For the avoidance of doubt, this Clause 10 shall not affect or limit Licensor’s withdrawal rights pursuant to Clause 6. Notwithstanding anything to the contrary contained herein, and subject to Licensor delivering Licensee 3D materials, the parties agree that the ‘left eye’ image from any 3D assets may be used by Licensee for creation of 2D encodes. In the event Licensee creates materials by “down-converting” a Copy supplied by Licensor, Licensee shall not alter the aspect ratio. of the output frame. No other forms of down-converting (other than of a digital file Copy in accordance with the immediately preceding sentence) is permitted under this Agreement. [#Discussed addition re “multichannel video programming” with Josephine. Intention of the change was so that (i) and (ii) have the same std. It is intended to refer to established triple play type providers in the territory ie Sky/Virgin equivalents. Agreed to add reference to “established trip play providers such as [#local example]” so that it would be an equivalent standard to those used by current operators. Same change can be added to (ii) as well as she was making them

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consistent but accepts that as worded that are completely open to any operator that may emerge whether we agree with their approach to program overlays or not.]

9.[11.] PROMOTIONS.

[11.1.] Licensee shall have the right to use or authorize the use of written summaries, extracts, synopses, photographs and trailers prepared and provided or made available by Licensor or, if altered by Licensee or used other than on the SVOD Service (e.g., in television advertisements or Internet banner ads) (subject to the below), approved in writing in advance by Licensor (provided such approval is not required for text-based materials altered by Licensee (e.g., synopses)) (“Advertising Materials”) and, subject to Clause 1211.2 below, Promotional Previews, solely for the purpose of advertising, promoting and publicizing the exhibition of the Included Programs on the SVOD Service (and, subject in all cases to Licensor’s prior written approval, off the SVOD Service includingincluding without limitation in blogs, emails and social media) and the right to advertise, publicize and promote, or authorize the advertising, publicity and promotion of the exhibition of any Included Program on the SVOD Service during the time periods and other restrictions specified below: [#Explained that we had already gone beyond our usual position of Promotional Preview on the service only and that could not agree to the removal of approval. Josephine discussing with new chief marketing officer. Consider language that doesn’t require on-going approval ie once approved once, they don’t have to keep coming back to us each time if it is the same kind of use.]

9.1.1.[11.1.1.] Licensee may promote the upcoming exhibition of each Library Feature or TV Series on the SVOD Service in printed materials distributed directly and solely to Registered Users not earlier than thirty (30) days prior to the Availability Date of such Included Program and continue promoting such availability through the last day of such Included Program’s License Period.

9.1.2.[11.1.2.] Licensee shall have the right to promote the upcoming exhibition of each Library Feature or TV Series to the general public and on the SVOD Service during the period starting thirty (30) days before its Availability Date and to continue promoting such availability through the last day of the License Period with respect to such Included Program.

[11.1.3.] Licensee shall not promote the availability of any Included Program on the SVOD Service after the expiration of the License Period for such Included Program; provided that promotion undertaken by means of any failure of the foregoing shall not be deemed a breach hereof (e.g., printed materials that have previously been distributed, or other kinds of promotional activity conducted during any Included Program’s License Period that remains public after the expiry of the License Period and would not typically be recalled or taken down (such as tweets or posts regarding the Included Program) shall not be required to be collected back after the expiration of the License Period. [#Consider further addition that such promotion be directed to availability during the Licence Period only.]

9.1.3.[11.1.4.] Marketing, promotional and advertising materials for a Library Feature or a TV Series shall conform to the following:

9.1.3.1.[11.1.4.1.] If an announcement, promotion or advertisement is more than 10 days in advance of such program’s Availability Date, Licensee shall

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There are many use cases beyond printed materials (eg, can’t “delete” tweets or posts), but old posts would be very far down in the chronology in any event and likely would require digging

only announce and/or promote and/or advertise (in any and all media) its future availability on the SVOD Service by referring to its specific Availability Date. By way of example, in such case “Coming to ______ on September 10” would be acceptable, but “Coming soon on _______” would not be acceptable.

9.1.3.2.[11.1.4.2.] If an announcement, promotion or advertisement is 10 or fewer days in advance of such program’s Availability Date, Licensee shall have the right to announce and/or promote and/or advertise (in any and all media) its future availability by referring generally to its upcoming availability or referring to its specific Availability Date. By way of example, in such case both “Coming to ______ on September 10” and “Coming soon on _______” would be acceptable.

[11.2.] Licensor hereby grants to Licensee a limited, non-exclusive license to exhibit Promotional Previews on the SVOD Service via Approved Delivery in accordance with Clause 1211.1 above, subject to any contractual restrictions of which Licensor notifies Licensee in writing. Notwithstanding anything to the contrary herein, in the event that any guild, union, or collective bargaining agreements or other third party agreements to which Licensor or its affiliates is or becomes a party requires a maximum duration for video clips that is shorter than the Maximum Preview Duration in order to avoid a residual, reuse or other fee in connection therewith, Licensor shall so notify Licensee in writing and Licensee shall either (i) shorten the duration of each affected Promotional Preview(s) on the SVOD Service in accordance with the terms of the notice (“Revised Preview Duration”) as soon as reasonably possible, but in no event longer than two (2) Business Days after receipt of such notice, or (ii) cease using the affected Promotional Preview(s). In addition to and without limiting any other remedy available to Licensor hereunder, in the event that Licensee exceeds the Maximum Preview Duration or any Revised Preview Duration (in the case of a Revised Preview Duration, after Licensee shortens the duration of such preview in accordance with the preceding sentence), Licensee shall indemnify Licensor for the costs of any residual, reuse or other fee payable by Licensor or its affiliates under the applicable guild, union or collective bargaining agreement(s) as a result thereof. Without limiting the foregoing, Licensor shall have the right to terminate (a) Licensee’s right to use a Promotional Preview for a particular Included Program on a case-by-case basis if Licensor reasonably believes that such Promotional Preview is not appropriate for all audiences or may violate the terms of any of Licensor’s agreements with, or may adversely affect Licensor’s material relations with any third party and (b) Licensee’s general right to use Promotional Previews under this Agreement if Licensor withdraws such general right from all other Internet SVOD distributors of Licensor’s content in the Territory (i.e., distributors who are authorized to deliver Licensor’s content for exhibition via the public Internet). Licensor shall give Licensee written notice of any such termination, in which event Licensee shall cease using the applicable Promotional Preview(s) within two (2) Business Days after receipt of such notice. For the avoidance of doubt, Licensee need not encrypt Promotional Previews or trailers.

[11.3.] Notwithstanding anything to the contrary herein, Licensee acknowledges and agrees that, subject to the conditions specified in this 1211.3, it shall be permitted to make the SVOD Service, including, without limitation, the Included Programs (and associated Copies), Promotional Previews and Advertising Materials hereunder available for

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promotional purposes to non-Registered Users within the Territory, solely via Approved Delivery and solely as exhibited on such non-Registered Users’ Approved Devices, at no charge to such non-Registered Users and for a limited trial period not to exceed one (1) month in each instance (a “Free Trial”). Licensee’s right to include Included Programs in each Free Trial is subject to the following:

9.1.4.[11.3.1.] In addition to the Included Programs, all other programs available on the SVOD Service must be made available for exhibition to non-Registered Users as part of the Free Trial.

9.1.5.[11.3.2.] Prior to enabling a trial period for a Free Trial for a non-Registered User, Licensee will require such non-Registered User to input account credentials which may include, among other things, user name, password, email address and/or information necessary, such as credit card information or bank account numbers, to allow Licensee to obtain payment from the non-Registered User after the Free Trial, or some combination thereof. If permitted by applicable law, Licensee shall notify non-Registered users that it shall charge such non-Registered Users for a subscription following the expiration of the Free Trial without obtaining further consent or any further information from such Registered User other than the consent obtained at the beginning of the Free Trial.

9.1.6.[11.3.3.] Licensee may not enable a trial period for a Free Trial for any non-Registered User who was previously authorized by Licensee using the same account credentials to participate in a Free Trial within the last twelve (12) months.

For the avoidance of doubt, except for Licensee’s limited ability to provide non-Registered Users trial access to the SVOD Service (including without limitation Included Programs) as part of a Free Trial and/or Spotify Promotion (as defined below), all relevant provisions of the Agreement shall remain in full force and effect, including Schedule B and Schedule D.

[11.3.4.] Notwithstanding anything to the contrary contained herein, from the Launch Date, and for a period of no more than seven (7) days, Licensee shall be permitted to promote (solely to registered and paying and paying subscribers to Spotify in the Territory) the offer to make the SVOD Service, including, without limitation, the Included Programs (and associated materials), Promotional Previews and Advertising Materials hereunder available for promotional purposes to non-Registered Users within the Territory, solely via Approved Delivery and solely as exhibited on such non-Registered Users’ Approved Devices, at no additional charge to such non-Registered Users (to such user’s Spotify subscription) for a trial period between the Launch Date and 31 December 2012 (inclusive) (“Spotify Promotion”). The Spotify Promotion must make available all content that is otherwise available on the SVOD Service for Registered Users.

[11.3.5.] The Parties will agree language in relation to the Spotify Promotion for public messaging in advance in writing provided always that the Spotify Promotion must not be referred to or promoted as a “free trial” and all promotional and advertising materials shall refer to such promotion as Netflix bundled with Spotify at no extra cost other than the original Spotify subscription. The Parties will agree language in relation to the Spotify

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Promotion for public messaging in advance in writing provided always that the Spotify Promotion must not be referred to or promoted as a “free trial” and all promotional and advertising materials shall refer to such promotion as Netflix bundled with Spotify at no extra cost other than the original Spotify subscription.

9.1.7.[11.3.6.] Prior to enabling the Spotify Promotion for a non-Registered User of the SVOD Service, Licensee will require such non-Registered User of the SVOD Service to input account credentials which may include, among other things, user name, password, email address and/or information necessary, such as credit card information or bank account numbers, to allow Licensee to obtain payment from the non-Registered User to the SVOD Service after the Spotify Promotion, or some combination thereof. If permitted by applicable law, Licensee shall notify non-Registered users of the SVOD Service that it shall charge such non-Registered Users of the SVOD Service for a subscription following the expiration of the Spotify Promotion without obtaining further consent or any further information from such Registered User other than the consent obtained at the beginning of the Spotify Promotion.

[11.3.7.] No advertising shall be permitted on the SVOD Service during any Free Trial period. No advertising shall be permitted on the SVOD Service during any Free Trial period (including the Spotify Promotion).

[11.3.8.] The rights granted in this Clause 12No exhibition of any Included Program hereunder (including during a Free Trial period) shall be interrupted for intermission, commercials or any other similar commercial announcements of any kind. [#To discuss this and clause 11.3.7 – can we agree to deletion of 11.3.7 and accept this – with additional wording added from cl 10?]

9.1.8. Notwithstanding anything to the contrary in this Agreement, neither Licensee nor its affiliates shall be responsible or liable for any acts or omissions of, or resulting from a consumer’s use of, an Approved Device and/or any third party software (including any Application or Playback Client). [#Why is this clause added here?] [#To discuss]

9.2.[11.4.] The rights granted in this Clause 11 above shall be subject to, and Licensee shall comply with, any and all restrictions or regulations of any applicable guild or union and any third party contractual provisions with respect to the advertising and billing of the Included Program in accordance with such instructions as Licensor may advise Licensee in writing. In no event shall Licensee be permitted to use any excerpts from an Included Program, other than (i) as provided by Licensor or (ii) Promotional Previews used in accordance with Clause 11.2.

9.3.[11.5.] Notwithstanding the foregoing, Licensee shall not, without the prior written consent of Licensor, (a) modify, edit or make any changes to the Advertising Materials (except in accordance with Licensee’s standard promotional practices), or (b) promote the exhibition of any Included Program on the SVOD Service by means of contest or giveaway. Appropriate copyright notices shall at all times accompany all Advertising Materials displayed on the SVOD Service and/or any promotions and/or advertising created by or on behalf of Licensee. For the avoidance of doubt, Licensee shall not be responsible for any Program Overlays on Advertising Materials (“Advertising Overlays”); provided that (i) Licensee shall include in its terms of service with third

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This language is already in Clause 10, but we’ve inserted it here per your request, with the clarification that it includes free trials.

parties who develop Applications a requirement that any Program Overlays conform to industry standard and (ii) if Licensee becomes aware of any third party implementing an Advertising Overlay in violation of the applicable terms of service, Licensee shall use reasonable means to address such violation and/or, in its reasonable discretion, revoke such third party access to the Included Programs and/or SVOD Service.

9.4.[11.6.] The names and likenesses of the characters, persons and other entities appearing in or connected with the production of Included Programs shall not be used separate and apart from the Advertising Materials which will be used solely for the purpose of advertising of the exhibition of such Included Programs, and no such name or likeness shall be used so as to constitute an endorsement or testimonial, express or implied, of any party, product or service, by “commercial tie-in” or otherwise. Licensee shall not use Licensor’s name or logo or any Included Program or any part of any Included Program as an endorsement or testimonial, express or implied, by Licensor, for any party, product or service including Licensee or any program service or other service provided by Licensee; provided, however, that Licensee may use Licensor’s name and logo for promotional purposes on the SVOD Service, and in connection with marketing and promotional activities, with Licensor’s prior written consent.

9.5.[11.7.] Within 90 calendar days after the last day of the Term, Licensee shall destroy (or at Licensor’s request, return to Licensor) all Advertising Materials for such Included Program which have been supplied by Licensor hereunder.

9.6.[11.8.] Promotions on the SVOD Service may position Subscription Video-On-Demand in a positive light, but in no event shall any such promotion contain negative messages about other means of film or television distribution.

10.[12.] LICENSOR’S REPRESENTATIONS AND WARRANTIES. Without limiting any other representation, warranty or covenant of Licensor herein, Licensor hereby represents and warrants to Licensee that:

10.1.[12.1.] It is a company duly organized under the laws of the state of its organization and has all requisite corporate power and authority to enter into this Agreement and perform its obligations hereunder.

10.2.[12.2.] The execution and delivery of this Agreement by Licensor has been duly authorized by all necessary corporate action.

10.3.[12.3.] This Agreement has been duly executed and delivered by, and constitutes a valid and binding obligation of Licensor, enforceable in accordance with the terms and conditions set forth in this Agreement, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors’ rights generally, and by general equitable or comparable principles.

[12.4.] Music rights: With respect to the exploitation of content as authorized herein, the public performance/public performance/communication to the public/ reproduction/making available to the public/making available to the public rights (collectively “Communication to the Public Rights”) to any music compositions contained in each of the Included Programs, are either (a) controlled by Nordisk Copyright Bureau (e.g. including STIM with respect to Sweden, TONO with respect to Norway, TEOSTO with respect to Finland and KODA with respect to Denmark, and are collectively represented by NCB, (or any other relevant collecting society in the Territory) (each, the “PRO”) (or any other relevant collecting society in the Territory), from which licenses on commercial terms and conditions covering Licensee’s

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transmissions of Included Programs in the Territory are available, (b) controlled by Licensor to the extent required for the licensing of the exhibition in accordance herewith (and not available for licensing through PROs), in which event no additional clearance of, or payment with respect to, such Communication to the Public Rights shall be required by Licensee associated with Licensee’s transmissions or other delivery of the Included Programs hereunder, or (c) in the public domain. In the event that music referenced in (a) above is included in an Included Program, Licensee shall be responsible for obtaining, if and to the extent required, a license from the relevant PROs for Communication to the Public Rights. Except as set forth in (b) above, Licensor does not represent or warrant that Licensee may exercise the Communication to the Public Rights in the music without obtaining a valid communication to the public license and without payment of a Communication to the Public Rights royalty or license fee to a PRO, and if a Communication to the Public Rights royalty or license fee is required to be paid in connection with the exhibition of Included Programs, Licensee shall be responsible for the payment thereof and shall hold Licensor free and harmless therefrom. Excluding the Communication to the Public Rights, Licensor has obtained all necessary rights (i.e., a worldwide buyout) for the exploitation of the musical compositions and sound recordings embodied within the Included Programs with respect to the exploitation of content in the Territory as authorized herein.

11.[13.] LICENSEE’S REPRESENTATIONS AND WARRANTIES. Without limiting any other representation, warranty or covenant of Licensee herein, Licensee hereby represents, warrants and covenants to Licensor that:

11.1.[13.1.] It is a company duly organized under the laws of the state of its organization and has all requisite corporate power and authority to enter into this Agreement and perform its obligations hereunder.

11.2.[13.2.] The execution and delivery of this Agreement has been duly authorized by all necessary corporate action.

11.3.[13.3.] This Agreement has been duly executed and delivered by, and constitutes a valid and binding obligation of Licensee, enforceable against such party in accordance with the terms and conditions set forth in this Agreement, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors’ rights generally, and by general equitable or comparable principles.

[13.4.] No Included Program shall be transmitted or exhibited except in accordance with the terms and conditions of this Agreement. Without limiting the generality of the foregoing, no Included Program shall be exhibited to any person other than a Registered User within the Territory as part of the SVOD Service in the medium of Subscription Video-On-Demand, or transmitted other than by Approved Delivery in an Approved Format to Approved Devices for Personal Use. [#Re-instated.] Notwithstanding the foregoing, Licensor acknowledges that Licensee cannot guarantee that current geofiltering technology shall be effective in every instance. Notwithstanding anything to the contrary, neither Licensee nor its affiliates shall be responsible or liable for any acts or omissions of, or resulting from a consumer’s use of, an Approved Device and/or any third party software (including any Application or Playback Client).

12.[14.] INDEMNIFICATION.

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Accepted with acknowledgements per tech.

[14.1.] Licensor shall indemnify and hold harmless Licensee and its representatives (with respect to a party, its officers, directors, equity owners, employees and other representatives and its parents, subsidiaries and affiliates (and their officers, directors, equity owners, employees and other representatives (collectively, the “Representatives”)) from and against any and all claims, damages, liabilities, costs and expenses, including reasonable outside counsel fees, incurred by the foregoing in any action or proceeding brought by a third party arising from or in connection with the breach by Licensor of any of its representations or warranties or any material provisions of this Agreement and claims that any of the Included Programs (including Copies) or Advertising Materials, under U.S. and/or applicable law, 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 provided, however, that Licensee shall promptly notify Licensor of any such claim or litigation. Notwithstanding the foregoing, the failure to provide such prompt notice shall diminish Licensor’s indemnification obligations only to the extent Licensor is actually prejudiced by such failure. In addition, Licensor shall not be required to indemnify Licensee or its Representatives for any claims resulting from Licensee exhibiting Included Programs or using Advertising Materials in a form other than as delivered (or deemed delivered) by Licensor or due to Licensee’s editing or modification of any Included Programs or Advertising Materials or Licensee’s authorization of a third party to do any of the foregoing. [#As previously agreed.]

12.1.[14.2.] Licensee shall indemnify and hold harmless Licensor and its Representatives from and against any and all claims, damages, liabilities, costs and expenses, including reasonable outside counsel fees, incurred by the foregoing in any action or proceeding brought by a third party arising from or in connection with (i) the breach of any representation, warranty or other material provision of this Agreement by Licensee, (ii) from the exhibition of any material (other than Advertising Materials exhibited in strict accordance with this Agreement and Licensor’s instructions therefor), in connection with or relating, directly or indirectly, to such Included Programs, or (iii) the infringement upon or violation of any right of a third party other than as a result of the exhibition of the Included Programs in strict accordance with the terms of this Agreement; provided, however, that Licensor shall promptly notify Licensee of any such claim or litigation. Notwithstanding the foregoing, the failure to provide such prompt notice shall diminish Licensee’s indemnification obligations only to the extent Licensee is actually prejudiced by such failure.

12.2.[14.3.] In any case in which indemnification is sought hereunder:

(a) At the indemnifying party’s option, the indemnifying party may assume the handling, settlement or defense of any such claim or litigation. If the indemnifying party assumes the handling, settlement or defense of any such claim or litigation, the party to be indemnified shall cooperate in the defense of such claim or litigation, and the indemnifying party’s obligation with respect to such claim or litigation shall be limited to holding the indemnified party harmless from any final judgment rendered on account of such claim or settlement made or approved by the indemnifying party in connection therewith, and expenses and reasonable attorneys fees of the indemnified party incurred in connection with the defense of such claim or litigation prior to the assumption thereof by the indemnifying party and any reasonable out-of-pocket expenses for performing such acts as the indemnifying party shall request. If the indemnifying party does

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Accepted

not assume the handling, settlement or defense of any such claim or litigation, the indemnifying party shall, in addition to holding the indemnified party harmless from the amount of any damages awarded in any final judgment entered on account of such claim, reimburse the indemnified party for reasonable costs and expenses and reasonable outside attorneys fees of the indemnified party incurred in connection with the defense of any such claim or litigation; and

(b) The party seeking indemnification shall fully cooperate with the reasonable requests of the other party in its participation in, and control of, any compromise, settlement, litigation or other resolution or disposition of any such claim. The indemnifying party shall not consent to the entry of any final judgment in any action without the indemnified party’s prior written approval except, in the case where Licensor is the indemnifying party, where such consent involves the agreement not to further exploit an Included Program.

[15.] REPORTING OBLIGATIONS. Licensee shall report electronically to Licensor at [email protected] the following information: on a monthly basis, within thirty (30) calendar days after the end of each calendar month, a written report detailing the aggregate number of unique Registered User viewers for each Included Program and the aggregate number of Registered User stream starts, in each instance with respect to the Territory (which within six (6) months of the date of this Agreement, shall be broken down by each country within the Territory); ; provided, however, that Registered Users attributable to a “free trial” of or other promotion for the SVOD Service shall not be included. Additionally, Licensee shall provide Licensor, at least once during each calendar quarter, with an informal business review, which if available and not subject to confidentiality restrictions will include (1) data and discussion regarding the performance and relative performance of Included Programs on the SVOD Service, Hardware Devices and/or Software Devices such as the performance of Included Programs by content type (e.g., episodic vs. feature) and age; (2) additional streaming data, such as the percentage of Registered Users actively streaming content on the SVOD Service; the average number of concurrent streams and registered Approved Devices used by actively streaming Registered Users; (3) the percentage of Registered Users who during the applicable reporting period have registered with such Registered User’s account more than six (6) Approved Devices (including any Approved Devices which are de-registered during such period); and (4) such other information that Licensor may reasonably request from time to time. Without limiting the foregoing, the parties agree to meet no less than two (2) times during each calendar year to discuss any additional reporting requirements, including information related to fraud heuristics. Licensee represents and warrants that it shall not, commencing on the Effective Date and throughout the remainder of the Term, disadvantage Licensor with respect to reporting by providing to any other Major Studio licensor with an SVOD license agreement in the Territory materially greater, relevant reporting information than provided to Licensor hereunder. [RE-instated.]

13.[16.] TERMINATION.

[16.1.] Without limiting any other provision of this Agreement and subject to Clause 16.3, upon the occurrence of a Licensee Termination Event (as defined below), Licensor may, in addition to any and all other rights which it may have against Licensee, immediately terminate this Agreement or any license hereunder with respect to an Included Program by giving written notice to Licensee and/or accelerate the payment of all monies payable under this Agreement such that they are payable immediately

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Author, 08/31/12,

This is not a first or second pay deal and we cannot agree to this.

and to retain such monies, it being acknowledged that Licensee’s material obligations hereunder include full, non-refundable payment of 100% of the license fees described in this Agreement regardless of any early termination of this Agreement due to a Licensee Termination Event unless expressly provided otherwise herein. [#Re-instated.]. Whether or not Licensor exercises such right of termination, Licensor shall, upon the occurrence of any Licensee Event of Default (as defined below), have no further obligation to deliver Copies or Advertising Materials to Licensee and Licensor shall have the right to require Licensee to immediately return all Copies [#Additional Copies as required] and Advertising Materials to Licensor. In addition to any and all other remedies in respect of a Licensee Event of Default which Licensor may have under applicable law, Licensor shall be entitled to recover from Licensee all payments past due from Licensee to Licensor hereunder, together with interest, compounded monthly, at the lesser of 2% above the prime rate of interest announced by Bank of America at such time or the maximum rate permitted by law, plus reasonable outside attorney fees, and all costs and expenses, including collection agency fees, incurred by Licensor to enforce the provisions thereof. Furthermore, upon a Licensee Event of Default, Licensor shall have the right to immediately suspend delivery of all Included Programs and Advertising Materials with respect thereto and/or suspend Licensee’s right to exploit any Included Programs, licensed hereunder, without prejudice to any of its other rights hereunder. As used herein, a “Licensee Event of Default” shall mean the occurrence of any of the following: (A) Licensee (x) fails to timely perform or breaches any of its material obligations hereunder or otherwise materially breaches this Agreement, (y) fails to make timely payment of fees under this Agreement or (z) assigns or otherwise transfers this Agreement in violation of this Agreement; or (B) upon (i) Licensee becoming unable to pay its debts; (ii) a petition being presented or a meeting being convened for the purpose of considering a resolution for the making of an administration order, the winding-up, bankruptcy or dissolution of Licensee; (iii) Licensee becoming insolvent; (iv) a petition under any bankruptcy or analogous act being filed by or against Licensee (which petition, if filed against Licensee, shall not have been dismissed by the relevant authority within 60 days thereafter); (v) Licensee executing an assignment for the benefit of creditors; (vi) a receiver being appointed for the assets of Licensee; (vii) Licensee taking advantage of any applicable bankruptcy, insolvency or reorganization or any other like statute; or (viii) the occurrence of any event analogous to the foregoing. As used herein a “Licensee Termination Event” shall mean: (I) the occurrence of a curable Licensee Event of Default described in subclause (A) above that Licensee has failed to cure within 30 days written notice from Licensor of the occurrence of such default; (II) the occurrence of a non-curable Licensee Event of Default described in subclause (A)(z) above; (III) the occurrence of a Licensee Event of Default described in subclause (B) above; and (IV) the occurrence of breach by Licensee of its confidentiality obligations under Clause 23.

13.1.[16.2.] Subject to Clause 16.3, in the event Licensor materially defaults in the performance of any of its material obligations hereunder or Licensor becomes insolvent, or a petition under any bankruptcy act shall be filed by or against Licensor (which petition, if filed against Licensor, shall not have been dismissed within 60 days thereafter), or Licensor executes an assignment for the benefit of creditors, or a receiver is appointed for the assets of Licensor, or Licensor takes advantage of any applicable insolvency or reorganization or any other like statute (each of the above acts is hereinafter referred to as a “Licensor Event of Default”), and Licensor fails to cure

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such Licensor Event of Default within 30 days after delivery by Licensee to Licensor of written notice of such Licensor Event of Default, then Licensee may, in addition to any and all other rights which it may have against Licensor, immediately terminate this Agreement by giving written notice to Licensor.

13.2.[16.3.] Notwithstanding anything to the contrary contained in Clauses 16.1 or 16.2 hereof, no termination of this Agreement for any reason shall relieve or discharge, or be deemed or construed as relieving or discharging, any party hereto from any duty, obligation or liability hereunder which was accrued as of the date of such termination (including, without limitation, the obligation to pay any amounts payable hereunder accrued as of such date of termination).

14.[17.] ASSIGNMENT. Subject to Clause 2.2, Licensee may assign this Agreement to a direct or indirect wholly-owned subsidiary of Licensee or to a person or entity which is under common control with Licensee (the term “control” meaning the power to unilaterally direct the policies and management of Licensee, whether through the ownership of voting securities or otherwise), but in no event an unaffiliated third party, that in each case is a U.S. legal entity (or which is a legal entity of any country in which any assignee of Licensor, if any, is formed) and that does not have a tax presence in any other country provided further that such assignment shall not release Licensee from any of its obligations hereunder. Licensee shall provide Licensor with prompt written notice of any such assignment, which notice shall include the assignee’s name and address, and the assigned territories. Other than explicitly set forth in the first two sentences of this Clause 17, Licensee shall not sell, assign, sublicense, subdistribute, transfer, mortgage, pledge or hypothecate this Agreement or any rights or licenses thereunder in whole or in part, or delegate any of its duties or obligations hereunder, without obtaining the prior written consent of Licensor, nor shall any of the Agreement or said rights or licenses be assigned or transferred or duties delegated by Licensee to any third party by operation of law (including, without limitation, by merger, consolidation or Change of Control (as hereinafter defined) or otherwise. A “Change of Control” shall occur: (i) with respect to a party that is a Public Company (as defined herein), if as a result of any event (including but not limited to any stock acquisition, acquisition of securities convertible into or exchangeable for voting securities, merger, consolidation or reorganization) any one or more persons or entities who together beneficially own, directly or indirectly, more than 20% of the combined voting power of the then-outstanding securities of such party immediately prior to such event (the “Public Company Controlling Shareholder(s)”) together fail to own, after such event, more than 20% of the combined voting power of the then-outstanding securities of such party (or any successor, resulting or ultimate parent company or entity of such party, as the case may be, as a result of such event); or (ii) with respect to a party which is not a Public Company (as defined herein), if as a result of any event (including but not limited to any stock acquisition, acquisition of securities convertible into or exchangeable for voting securities, merger, consolidation or reorganization) any one or more persons or entities who together beneficially own, directly or indirectly, more than 50% of the combined voting power of the then-outstanding securities of such party immediately prior to such event (the “Non-Public Company Controlling Shareholder(s)”) together fail to own, after such event, more than 50% of the combined voting power of the then-outstanding securities of such party (or any successor, resulting or ultimate parent company or entity of such party, as the case may be, as a result of such event). “Public Company” means any company or entity (i) whose securities are registered pursuant to the Securities Act of 1933, as amended, (ii)

32

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whose securities are traded in any national or international stock exchange or over the counter market or (iii) which is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended.

15.[18.] HEADINGS. The titles of the paragraphs of this Agreement are for convenience only and shall not in any way affect the interpretation of this Agreement.

16.[19.] NON-WAIVER OF BREACH; REMEDIES CUMULATIVE. A waiver by either party of any of the terms or conditions of this Agreement shall not, in any instance, be deemed or construed to be a waiver of such terms or conditions for the future or of any subsequent breach thereof. No payment or acceptance thereof pursuant to this Agreement shall operate as a waiver of any provision hereof. All remedies, rights, undertakings, obligations and agreements contained in this Agreement shall be cumulative and none of them shall be in limitation of any other remedy, right, undertaking, obligation, or agreement of either party.

17.[20.] NOTICES. All notices hereunder shall be in writing and shall be sent by certified (return receipt requested) or registered mail, by air courier service, by personal delivery, or by facsimile to the address or fax number of the party for whom it is intended as follows, or to such other address or fax number as any party may hereafter specify in writing:

If to Licensor:

Sony Pictures Entertainment Inc.10202 West Washington BoulevardCulver City, California 90232Attention: General CounselFacsimile: 310-244-0510

with a copy to:

Colgems LimitedSony Pictures Europe House25 Golden Square,London W1F 9LUAttention: Senior Vice President, Legal AffairsFacsimile: (44) (0)207 533 1235

If to Licensee:

Netflix Luxembourg, S.à.r.l. 13-15, Avenue de la Liberté, L-1931Luxembourg, Grand -Duchy of Luxembourg

With a copy to:

Netflix, Inc.Maple Plaza345 North Maple DriveSuite 300Beverly Hills, CA 90210Attention: Sean Carey, Vice President, Content

33

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Facsimile: 310-734-[#]-2946

Netflix, Inc.100 Winchester CircleLos Gatos, California 95032Attention: General CounselFacsimile: 408-540-3642

Notice given by personal delivery or facsimile shall be deemed given upon delivery and notice given by overnight delivery or courier service shall be deemed given the first Business Day following the Business Day of delivery to the overnight delivery service.

18.[21.] GOVERNING LAW/ARBITRATION. This Agreement shall be construed and enforced in accordance with the laws of the State of California without regard to the choice of law principles thereof. Any controversy or claim arising out of or relating to this Agreement, including but not limited to its enforcement, arbitrability or interpretation shall be submitted to final and binding arbitration, to be held in Los Angeles County, California, before a single arbitrator, in accordance with California Code of Civil Procedure §§ 1280 et seq. The arbitrator shall be selected by mutual agreement of the parties or, if the parties cannot agree, then the arbitrator shall be appointed by JAMS/Endispute. The arbitration shall be a confidential proceeding, closed to the general public. The arbitrator shall issue a written opinion stating the essential findings and conclusions upon which the arbitrator’s award is based. The parties will share equally in payment of the arbitrator’s fees and arbitration expenses and any other costs unique to the arbitration hearing (recognizing that each side bears its own deposition, witness, expert and attorney’s fees and other expenses to the same extent as if the matter were being heard in court). Nothing in this Clause 21 shall affect either party’s ability to seek from a court injunctive or equitable relief at any time.

19.[22.] FORCE MAJEURE. Neither party shall in any manner whatsoever be liable or otherwise responsible for any delay or default in, or failure of performance resulting from or arising out of or in connection with any Event of Force Majeure, and no such delay, default in, or failure of performance shall constitute a breach by either party hereunder.

20.[23.] CONFIDENTIALITY. Other than as may be required by law, or governmental authority, or to enforce its rights hereunder, and subject to the following sentence, neither party shall, without the express written consent of the other, publicly divulge or announce, or in any manner disclose to any third party, other than its attorneys, advisors, directors, employees, agents, shareholders, accountants, parent entities or auditors, profit participants, or pursuant to Guild obligations (each of whom shall be subject to the confidentiality provision hereof) on a need-to-know basis, any of the specific terms and conditions of this Agreement, including, without limitation, the License Fees payable hereunder and any reporting information provided pursuant to the terms of the Agreement. Neither party shall issue any press release regarding the existence of or terms of this Agreement without the prior written consent of the other party.

21.[24.] THIRD PARTY CONTRACTORS. Notwithstanding anything to the contrary contained herein, Licensor acknowledges and agrees that, in order for Licensee to operate and maintain the SVOD Service in the Territory or otherwise host, serve, exhibit and distribute Included Programs in the Territory, Licensee may use the communications, hosting, data processing and/or fulfillment services of third parties; provided, however,

34

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that Licensee will remain, in all respects, directly and primarily liable to Licensor for all of Licensee’s obligations hereunder and for all acts and omissions of such third parties, including any breach of this Agreement, or acts or omissions, which if taken by Licensee, would be a breach of this Agreement.

[25.] AUDIT. Licensee shall keep and maintain complete and accurate books of account and records at its principal place of business in connection with each of the Included Programs and pertaining to Licensee’s compliance with the terms hereof, including, without limitation, copies of the reports referred to in Clause 15 hereof for a period of two (2) years after termination or expiration of this Agreement. Licensor shall have the right, exercisable no more than once per calendar year, on no less than five (5) days written notice to Licensee, and at a time and place to be mutually agreed upon by Licensor and Licensee, to audit and check Licensee’s books and records pertaining to the accuracy of the statements and other financial information delivered to Licensor by Licensee and the amount of the License Fees paid or payable hereunder. The exercise by Licensor of any right to audit or the acceptance by Licensor of any statement or payment, whether or not the subject of an audit, shall not bar Licensor from thereafter asserting a claim for any balance due, and Licensee shall remain fully liable for any balance due under the terms of this Agreement. If the good faith undisputed results of an examination establishes an error in Licensee’s computation of License Fees due with respect to the Included Programs, Licensee shall immediately pay the amount of underpayment, plus interest thereon from the date such payment was originally due at a rate equal to the lesser of 2% above the prime rate of interest announced by Bank of America at such time or the maximum rate permitted by applicable law. If such error is in excess of 10% of such License Fees due for the period covered by such audit, Licensee shall, in addition to making immediate payment of the additional License Fees due plus interest in accordance with the previous sentence, pay to Licensor (i) the costs and expenses incurred by Licensor for any audit, and (ii) reasonable attorney’s fees incurred by Licensor in enforcing the collection thereof. [#Re-instated.]

[26.] SEVERABILITY. If any provision of this Agreement is determined by a court or arbitrator to be invalid or unenforceable, such determination shall not affect any other provision of this Agreement, each of which shall be construed and enforced as if such invalid or unenforceable provision were not contained herein.

22.[27.] COUNTERPARTS. This Agreement may be executed in any number of counterparts and all of such counterparts taken together shall constitute one and the same instrument.

23.[28.] NO THIRD PARTY BENEFICIARY. This Agreement is entered into for the express benefit of the parties hereto, their successors and permitted assigns and is not intended, and shall not be deemed, to create in any other natural person, corporation, company, and/or any other entity whatsoever any rights or interest whatsoever, including, without limitation, any right to enforce the terms hereof.

24.[29.] LIMITATION OF LIABILITY. Neither party shall be liable to the other for special, consequential or incidental losses or for lost profits.

25.[30.] PRESUMPTIONS. In interpreting the terms and conditions of this Agreement, no presumption shall be interpreted for or against a party as a result of the role of such party or such party’s counsel in the drafting of this Agreement.

35

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Author, 08/29/12,

As discussed, this is no longer a rev share deal and therefore this clause is not applicable.

26.[31.] ENTIRE UNDERSTANDING. This Agreement includes the entire understanding of the parties with respect to the subject matter hereof, and all prior agreements (written or oral) with respect to such subject matter have been merged herein. No representations or warranties have been made other than those expressly provided for herein. This Agreement may not be modified, except by a written instrument signed by the parties, and this provision may not be waived except by written instrument signed by the parties.

27.[32.] NO MODIFICATION OF OTHER AGREEMENTS. In no event shall this Agreement (i) modify the terms of any other agreement or licensing arrangement between the parties with respect to motion pictures, television programs or other entertainment content which are not the subject matter hereof or with respect to the Included Programs in territories other than the Territory or (ii) grant rights to or impose restrictions on either party with respect to such other content or territories.

IN WITNESS WHEREOF, the duly authorized representatives of Netflix Luxembourg S.à r.l and Colgems Limited have executed this Agreement as of the date first written above.

COLGEMS LIMITED NETFLIX LUXEMBOURG S.À R.L.

By: By:

Its: Its:

36

document.docx

Schedule A

NETFLIX YEAR 1 LIBRARY FEATURE SCHEDULEAVAIL YEAR 1[#updated lists to be provided]

37

NETFLIX YEAR 1 TV SERIES SCHEDULE AVAIL YEAR ONE[#updated lists to be provided]

38

SCHEDULE A1 [#DELETE IF NOT REQUIRED] NETFLIX LAUNCH PACK SCHEDULE

LAUNCH PACK TITLES

Product CategoryAvailability

Date End Date Rel Year TitleProduct

typeScandinavian

BOMonths

> LVR

39

NETFLIX YEAR 1 LIBRARY FEATURE SCHEDULEAVAIL YEAR 1

# Title - Library FeatureRelease

Year TierAvailability

DateEnd

Date

Source Materials delivered to Netflix

by*1 America's Sweethearts 2001 A 15-Oct-2012 31-Dec-2013 17-Sept -20122 Anger Management 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -20123 Bad Boys II 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -20124 Charlie's Angels 2000 A 15-Oct-2012 31-Dec-2013 17-Sept -20125 Charlie's Angels: Full Throttle 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -20126 Daddy Day Care 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -20127 Erin Brockovich 2000 A 15-Oct-2012 31-Dec-2013 17-Sept -20128 Ghostbusters 1984 A 15-Oct-2012 31-Dec-2013 17-Sept -20129 Ghostbusters 2 1989 A 15-Oct-2012 31-Dec-2013 17-Sept -2012

10 Gothika 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -201211 I Spy 2002 A 15-Oct-2012 31-Dec-2013 17-Sept -201212 Men in Black II 2002 A 15-Oct-2012 31-Dec-2013 17-Sept -201213 Peter Pan 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -201214 S.W.A.T. 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -201215 Stuart Little 1999 A 15-Oct-2012 31-Dec-2013 17-Sept -201216 The Karate Kid 1984 A 15-Oct-2012 31-Dec-2013 17-Sept -201217 The One 2001 A 15-Oct-2012 31-Dec-2013 17-Sept -201218 The Patriot 2000 A 15-Oct-2012 31-Dec-2013 17-Sept -201219 The Rundown 2003 A 15-Oct-2012 31-Dec-2013 17-Sept -201220 XXX 2002 A 15-Oct-2012 31-Dec-2013 17-Sept -201221 28 Days 2000 B 15-Oct-2012 31-Dec-2013 17-Sept -201222 A Few Good Men 1992 B 15-Oct-2012 31-Dec-2013 17-Sept -201223 A Knight's Tale 2001 B 15-Oct-2012 31-Dec-2013 17-Sept -201224 Center Stage 1999 B 15-Oct-2012 31-Dec-2013 17-Sept -201225 Devil in a Blue Dress 1995 B 15-Oct-2012 31-Dec-2013 17-Sept -201226 Final Fantasy: The Spirits Within 2001 B 15-Oct-2012 31-Dec-2013 17-Sept -201227 Gandhi 1982 B 15-Oct-2012 31-Dec-2013 17-Sept -201228 Ghosts of Mars 2001 B 15-Oct-2012 31-Dec-2013 17-Sept -2012

40



DateEnd

Date


by*29 Godzilla 1998 B 15-Oct-2012 31-Dec-2013 17-Sept -201230 Groundhog Day 1993 B 15-Oct-2012 31-Dec-2013 17-Sept -201231 Hollow Man 2000 B 15-Oct-2012 31-Dec-2013 17-Sept -201232 Hook 1991 B 15-Oct-2012 31-Dec-2013 17-Sept -201233 In the Line of Fire 1993 B 15-Oct-2012 31-Dec-2013 17-Sept -201234 It Could Happen to You 1994 B 15-Oct-2012 31-Dec-2013 17-Sept -201235 Jakob the Liar 1999 B 15-Oct-2012 31-Dec-2013 17-Sept -201236 Jerry Maguire 1996 B 15-Oct-2012 31-Dec-2013 17-Sept -201237 Last Action Hero 1993 B 15-Oct-2012 31-Dec-2013 17-Sept -201238 Last Dragon, The 1985 B 15-Oct-2012 31-Dec-2013 17-Sept -201239 Little Women 1994 B 15-Oct-2012 31-Dec-2013 17-Sept -201240 Look Who's Talking 1989 B 15-Oct-2012 31-Dec-2013 17-Sept -201241 Madeline 1998 B 15-Oct-2012 31-Dec-2013 17-Sept -201242 Medallion, The 2003 B 15-Oct-2012 31-Dec-2013 17-Sept -201243 Muppets from Space 1999 B 15-Oct-2012 31-Dec-2013 17-Sept -201244 Muppets Take Manhattan, The 1984 B 15-Oct-2012 31-Dec-2013 17-Sept -201245 My Best Friend's Wedding 1997 B 15-Oct-2012 31-Dec-2013 17-Sept -201246 National Security 2003 B 15-Oct-2012 31-Dec-2013 17-Sept -201247 Not Another Teen Movie 2001 B 15-Oct-2012 31-Dec-2013 17-Sept -201248 Random Hearts 1999 B 15-Oct-2012 31-Dec-2013 17-Sept -201249 Replacement Killers, The 1998 B 15-Oct-2012 31-Dec-2013 17-Sept -201250 Serpico 1973 B 15-Oct-2012 31-Dec-2013 17-Sept -201251 Seven Years in Tibet 1997 B 15-Oct-2012 31-Dec-2013 17-Sept -201252 Tomcats 2001 B 15-Oct-2012 31-Dec-2013 17-Sept -201253 Trapped 2002 B 15-Oct-2012 31-Dec-2013 17-Sept -201254 Vampires 1998 B 15-Oct-2012 31-Dec-2013 17-Sept -201255 Wild Things 1998 B 15-Oct-2012 31-Dec-2013 17-Sept -201256 3 Ninjas: High Noon at Mega

Mountain1998 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

57 3 Ninjas: Knuckle Up 1995 C 15-Oct-2012 31-Dec-2013 17-Sept -201258 Baby Geniuses 1999 C 15-Oct-2012 31-Dec-2013 17-Sept -201259 Bottle Rocket 1996 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

41



DateEnd

Date


by*60 Chances Are 1989 C 15-Oct-2012 31-Dec-2013 17-Sept -201261 Cowboy Bebop: The Movie 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201262 Eight Crazy Nights 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201263 Fear Dot Com 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201264 Force 10 from Navarone 1978 C 15-Oct-2012 31-Dec-2013 17-Sept -201265 Fright Night 1985 C 15-Oct-2012 31-Dec-2013 17-Sept -201266 Half Past Dead 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201267 Idle Hands 1999 C 15-Oct-2012 31-Dec-2013 17-Sept -201268 Little Secrets 2001 C 15-Oct-2012 31-Dec-2013 17-Sept -201269 Metropolis 2001 C 15-Oct-2012 31-Dec-2013 17-Sept -201270 No Escape 1994 C 15-Oct-2012 31-Dec-2013 17-Sept -201271 Punch-Drunk Love 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201272 Rollerball 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201273 Rudyard Kipling's The Second

Jungle Book: Mowgli and Baloo1997 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

74 sex, lies, and videotape 1989 C 15-Oct-2012 31-Dec-2013 17-Sept -201275 Short Circuit 2 1988 C 15-Oct-2012 31-Dec-2013 17-Sept -201276 Stealing Harvard 2002 C 15-Oct-2012 31-Dec-2013 17-Sept -201277 The Adventures of Elmo in

Grouchland1999 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

78 The Baby Sitters Club 1995 C 15-Oct-2012 31-Dec-2013 17-Sept -201279 The Care Bears Movie II: A New

Generation1986 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

80 The Craft 1996 C 15-Oct-2012 31-Dec-2013 17-Sept -201281 The Crimson Rivers 2000 C 15-Oct-2012 31-Dec-2013 17-Sept -201282 The Fog of War 2003 C 15-Oct-2012 31-Dec-2013 17-Sept -201283 The Juror 1996 C 15-Oct-2012 31-Dec-2013 17-Sept -201284 The Professionals 1966 C 15-Oct-2012 31-Dec-2013 17-Sept -201285 The Quick and the Dead 1995 C 15-Oct-2012 31-Dec-2013 17-Sept -201286 The Swan Princess 1994 C 15-Oct-2012 31-Dec-2013 17-Sept -201287 Thunderheart 1992 C 15-Oct-2012 31-Dec-2013 17-Sept -201288 Tsui Hark's Vampire Hunters 2003 C 15-Oct-2012 31-Dec-2013 17-Sept -2012

42



DateEnd

Date


by*89 Two Can Play That Game 2001 C 15-Oct-2012 31-Dec-2013 17-Sept -201290 Universal Soldier: The Return 1999 C 15-Oct-2012 31-Dec-2013 17-Sept -201291 A Father's Choice 2000 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201292 An Evening with Kevin Smith 2002 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201293 Call Me Claus 2001 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201294 Gorgeous 1999 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201295 Heavy Metal 2000 2000 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201296 The Shadow Riders 1982 DTV 15-Oct-2012 31-Dec-2013 17-Sept -201297 The Swan Princess: The Mystery of

the Enchanted Treasure1998 DTV 15-Oct-2012 0-Jan-1900 17-Sept -2012

* In accordance with Clause 8, Licensor shall deliver Source Materials no later than sixty (60) days prior to the Availability Date for each Included Program. The parties agree that for any Included Program for which the Availability Date is less than ninety (90) calendar days after the Effective Date, Licensee shall receive or be granted access as soon as practicable, and in any event no later than September 17, 2012.

43

Author, 08/29/12,

We re-inserted the agreed Library Features schedule. Please let us know if you need to make an update to this schedule.

NETFLIX YEAR 1 TV SERIES SCHEDULE AVAIL YEAR ONE

Sweden Denmark Norway Finland

TitleNo. of

Episodes CategoryFee/Ep (USD)

Total Fee

(USD)Availability

DateEnd Date

Availability Date

End Date

Availability Date

End Date

Availability Date

End Date

10 ITEMS OR LESS SEASON 01

5 Library B $3,000 $15,000 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013





AS IF (UK VERSION) SEASON 01

18 Library C $2,500 $45,000 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013





BOONDOCKS, THE SEASON 01

15 Animated $1,500 $22,500 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013





BREAKING BAD SEASON 01

7 Current Series - 1 Hour

$12,500 $87,500 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 1-Aug-2013 31-Jul-2014 15-Oct-2012 31-Dec-2013










BREAKING BAD SEASON 05A


$10,000 $80,000 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 n/a n/a 15-Oct-2012 31-Dec-2013

DROP DEAD DIVA SEASON 01


$12,500 $162,500 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013

DROP DEAD DIVA SEASON 02


$12,500 $162,500 1-Nov-2013 31-Oct-2014 1-Nov-2013 31-Oct-2014 1-Nov-2013 31-Oct-2014 1-Nov-2013 31-Oct-2014

JACKIE CHAN ADVENTURES SEASON 01


44

Author, 08/31/12,

We re-inserted the agreed TV Series schedule, with the understanding there will be a few updates to come.

Sweden Denmark Norway Finland

TitleNo. of

Episodes CategoryFee/Ep (USD)

Total Fee

(USD)Availability

DateEnd Date

Availability Date

End Date

Availability Date

End Date

Availability Date

End Date

JACKIE CHAN ADVENTURES SEASON 02


MARVEL ANIME: BLADE SEASON 01


MARVEL ANIME: IRONMAN SEASON 01


MARVEL ANIME: WOLVERINE SEASON 01


MARVEL ANIME: X-MEN SEASON 01


ODYSSEY 5 19 Library A $3,500 $66,500 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013

THE BIG C SEASON 01 13 Current Series - Half Hour


THE BIG C SEASON 02 13 Current Series - Half Hour


THE TUDORS SEASON 01 10 Non-Returning Series - 1 Hour

$6,500 $65,000 1-Aug-2013 31-Jul-2014 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013


$6,500 $65,000 1-Aug-2013 31-Jul-2014 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013 15-Oct-2012 31-Dec-2013





TRANSFORMERS: BEAST MACHINES SEASON 01


TRANSFORMERS: BEAST MACHINES SEASON 02


In accordance with Clause 8, Licensor shall deliver Source Materials no later than sixty (60) days prior to the Availability Date for each Included Program. The parties agree that for any Included Program for which the Availability Date is less than ninety (90) calendar days after the Effective Date, Licensee shall receive or be granted access as soon as practicable, and in any event no later than September 17, 2012.

45

SCHEDULE B

CONTENT PROTECTION REQUIREMENTS AND OBLIGATIONS

1. Content Protection System. All Included Programs delivered by Licensee to, output from or stored on an Approved Device must be protected by a content protection system that includes digital rights management, conditional access systems and digital output protection (such system, the “Content Protection System”). The Content Protection System shall (i) be fully compliant with all the compliance and robustness rules set forth in this Schedule B, and (ii) use only those rights settings, if applicable, set forth in this Schedule B or that are otherwise approved in writing by Licensor. Upgrades to or new versions of the Content Protection System that would materially and negatively affect the protection provided to Included Programs shall be approved in writing by Licensor.

1.1. Explicitly Prohibited. For the avoidance of doubt.

1.1.1. Unencrypted streaming of Included Programs is prohibited.

1.1.2. Unencrypted downloads of Included Programs is prohibited.

1.1.3. All Included Programs shall be transmitted and stored in a secure encrypted form. Included Programs shall never be transmitted to or between devices in unencrypted form.

1.2. Approved Protection Systems. The following protection systems are approved, with the conditions shown, as part of the Content Protection System, provided that Licensor shall have the right to withdraw its approval of a subsequent release by its publisher of any such protection system, upon reasonable advance written notice, in the event that release materially and negatively alters such protection system such that such protection system no longer enforces the relevant provisions of this Schedule B or the Usage Rules:

1.2.1. Windows Media DRM 10 (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date). Windows Media DRM 10 is NOT approved for the delivery of Included Programs in High Definition to Software Devices;

1.2.2. Silverlight Powered by PlayReady and/or PlayReady (Windows Media DRM 11)( and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date);

1.2.3. Widevine Cypher 4.2 DRM (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date);

1.2.4. Advanced Access Content Systems (“AACS”) specification version 0.95 (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date). AACS is NOT approved for the delivery of Included Programs in High Definition to Software Devices;

1.2.5. Marlin Broadband v1.2.2 DRM in compliance with the Marlin Trust Management Organization’s robustness and compliance rules (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date);

1.2.6. Adobe Flash Access 2.0 (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date);

1.2.7. Apple FairPlay (and any successor and/or update thereto that maintains a level of robustness that is equal to or greater than the robustness as of the Effective Date) but solely with respect to iOS devices; and/or

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1.2.8. SSL Transport Layer Content Protection. For streaming only to Approved Devices other than personal computers, Licensee will use a system with SSL providing encryption and integrity protection of content where: (a) SSL shall be either Secure Socket Layer version 3 (SSLv3) or Transport Layer Security version 1 (TLSv1) or later transport layer security protocols;(b) clients shall be uniquely identifiable; (c) mutual authentication shall be provided by X.509 certificate based authentication, token based authentication or both; and (d) content protection shall be ensured by securing content keys using hardware resources and/or industry strength tamper resistance.

SSL Transport Layer Content Protection is NOT approved for the delivery of Included Programs in High Definition to Software Devices.

1.2.9. “http live streaming” (HLS) protocol. Licensor’s classification of http live streaming as an Approved Protection System is only temporary and Licensee shall migrate from use of http live streaming (implementations of which are not governed by any compliance and robustness rules nor any legal framework ensuring implementations meet these rules) to use of an industry accepted DRM or secure streaming method which is governed by compliance and robustness rules and an associated legal framework, by end March 31st, 2012. “http live streaming” is NOT approved for the delivery of Included Programs in High Definition to Software Devices.

1.3. High Definition Requirements (Both Hardware and Software Devices)

1.3.1. All firmware responsible for content protection must be validated for origin using digital signature validation or some other cryptographically secure validation mechanism (such as AES-128 encryption, CMAC using 128 bit or higher security encryption, HMAC using 128 bit or higher security, etc) before any firmware update is applied. Additionally, Licensee recommends Approved Device manufacturers implement secure boot.

1.3.2. Systems must not allow unencrypted video signals on busses accessible by users using widely available tools. Notwithstanding anything to the contrary herein, to the extent Licensor makes Included Programs available in High Definition for exhibition on Approved Devices that are Software Devices, this Clause 1.3.2 will apply to Software Devices.

1.4. Requirements for HD delivery to Software Devices. The requirements below shall apply for the delivery of HD Included Films to Software Devices. . [TW: we need a call with NF on these then. The resintatements in 1.4.3 and 1.4.4 just don’t make any sense. And for our insertions below, we need to see what NF do not like about them, apart from the fact that they weren’t in the original agreement. I wouldn’t be surprised if NF didn’t review our changes with their technical teams at all but just reverted to the original language as a first step.]

1.4.1. Allowed Platforms

1.4.1.1. HD content for Software Devices is only allowed on the device platforms (operating system, Content Protection System, and device hardware, where appropriate) specified elsewhere in this Agreement. [SPE: we are reinstating but know that Netflix’s Mitch Zollinger will propose an alternative requirement for this]

1.4.2. Robust Implementation

1.4.2.1. Implementations of Approved Protection Systems on Software Devices shall use hardware-enforced security mechanisms, including trusted execution environments, where reasonably possible.

1.4.2.2. Implementation of Approved Protection Systems on Software Devices shall, in all cases, use state of the art obfuscation mechanisms or trusted execution

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Author, 09/10/12,

#re-instated all language as previously agreed

Author, 08/29/12,

#re-instated all language as previously agreed

environments for the security sensitive parts of the software implementing the Content Protection System. [SPE: we are reinstating 1.4.2.1 and 1.4.2.2 but know that Netflix’s Mitch Zollinger will propose alternative requirements here for us to discuss]

1.4.2.3. All Software Devices deployed by Licensee after end December 31st, 2013, SHALL support hardware-enforced security mechanisms, including trusted execution environments and secure boot. For the avoidance of doubt, this requirement applies to actual, physical devices which are deployed to Subscribers by Licensee only and does not apply to software Playback Clients or Applications distributed by Licensee. [SPE: we have resinstated but proposed a clarification which we hope will meet Netflix concerns here]

1.4.3. For avoidance of doubt, HD content may only be output in accordance with Clause “Digital Outputs” above unless stated explicitly otherwise below.

1.4.4. If an HDCP connection cannot be established, as required by Clause “Digital Outputs” above, the playback of Included Programs over an output on a Software Device (either digital or analogue) must be limited to a resolution no greater than Standard Definition (SD). Notwithstanding the foregoing, as long as Licensee receives an affirmative response that HDCP is engaged, Licensee may deliver an Included Program in HD.

1.4.5. [SPE: we have reinstated our position here. This topic was discussed in the technical call. #As this service was not in existence before December 31st, 2012, there can be no devices registered before that date, so this exception does not apply]

1.4.6. With respect to playback in HD over analog outputs on Software Devices, Licensee shall either (i) prohibit the playback of such HD content over all analogue outputs on all such Software Device or (ii) ensure that the playback of such content over analogue outputs on all such Software Device is limited to a resolution no greater than SD.

1.4.7. Notwithstanding anything in this Agreement, if Licensee is not in compliance with this Clause, then, upon Licensor’s written request, Licensee will temporarily disable the availability of Included Programs in HD via the Licensee service within thirty (30) days following Licensee becoming aware of such non-compliance or Licensee’s receipt of written notice of such non-compliance from Licensor until such time as Licensee is in compliance with this Clause “Requirements for HD delivery to Software Devices”; provided that:

1.4.7.1. if Licensee can robustly distinguish between Software Devices that are in compliance with this Clause “Requirements for HD delivery to Software Devices”, and Software Devices which are not in compliance, Licensee may continue the availability of Included Programs in HD for Software Devices that it reliably and justifiably knows are in compliance but is required to disable the availability of Included Programs in HD via the Licensee service for all other Software Devices, and

1.4.7.2. in the event that Licensee becomes aware of non-compliance with this Clause, Licensee shall promptly notify Licensor thereof; provided that Licensee shall not be required to provide Licensor notice of any third party hacks to HDCP.

1.4.8. Secure Video Paths:

The video portion of unencrypted content shall not be present on any user-accessible bus in any analog or unencrypted, compressed form. In the event such unencrypted, uncompressed content is transmitted over a user-accessible bus in digital form, such content shall be either limited to standard definition (720 X 480 or 720 X 576), or made reasonably secure from unauthorized interception.

1.4.9. Secure Content Decryption.document.docx48

1.4.9.1. Decryption of (i) content protected by the Content Protection System and (ii) CSPs (as defined in Clause 2.1 below) related to the Content Protection System shall take place in an isolated processing environment such that decrypted content and CSPs are protected at all times in the device, including during transmission to the graphics card for rendering, from attack from other software processes on the device. “CSPs” shall mean keys, passwords, and any other information that are critical to the security robustness of the Content Protection System.

2. Outputs.

2.1. For Approved Devices with respect to which Licensee exercises sole control over design and manufacturing, if any, such devices shall limit analog outputs to a maximum resolution of 1080i and shall not permit analog outputs at a resolution of 1080p or greater.

2.2. [#No longer require CGMS-A]

2.3. The Content Protection System shall prohibit digital output of unprotected, unencrypted Included Programs. Notwithstanding the foregoing but subject to Clause 2.4A, the Content Protection System may allow a digital signal to be output if it is protected and encrypted by High Definition Copy Protection (“HDCP”) or Digital Transmission Copy Protection (“DTCP”). Further, the Content Protection System may implement (i) Digital Video Interface version 1.0 (“DVI”) without HDCP and allow only standard definition or scaled standard definition output on such interface on personal computer platforms in accordance with the allowances for DVI outputs through the DVD-CCA and/or (ii) an exception for unprotected analog and digital outputs to allow only standard definition or scaled standard definition output on such interface on personal computer platforms in accordance with the allowances for analog and digital outputs through the DVD-CCA; provided, however, that in the event that the DVD-CCA authorizes an exception to current or future DVD-CCA allowances for any such output for personal computer manufacturers, Licensor acknowledges and agrees that Licensee shall be entitled to the benefit of such exception. For the avoidance of doubt and notwithstanding anything to the contrary herein, the Content Protection System may allow High Definition content to be output via a digital output only if it is protected by HDCP or DTCP. Defined terms used but not otherwise defined in this Clause 2.4 shall have the meanings given them in the DTCP or HDCP license agreements, as applicable.

2.3.1. An Approved Device that outputs decrypted Included Programs provided pursuant to the Agreement using DTCP shall:

2.3.1.1. Deliver system renewability messages to the source function;

2.3.1.2. Map the copy control information associated with the program; the copy control information shall be set to “copy never” in the corresponding encryption mode indicator and copy control information field of the descriptor;

2.3.1.3. Map the analog protection system (“APS”) bits associated with the program to the APS field of the descriptor;

2.3.1.4. Set the image_constraint_token field of the descriptor as authorized by the corresponding license administrator;

2.3.1.5. Set the eligible non-conditional access delivery field of the descriptor as authorized by the corresponding license administrator;

2.3.1.6. Set the retention state field of the descriptor as authorized by the corresponding license administrator;

2.3.1.7. Deliver system renewability messages from time to time obtained from the corresponding license administrator in a protected manner; and

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2.3.1.8. Perform such additional functions as may be required by Licensor to effectuate the appropriate content protection functions of these protected digital outputs.

2.3.2. An Approved Device that outputs decrypted Included Programs provided pursuant to the Agreement using HDCP shall:

2.3.2.1. If requested by Licensor and if supported by a particular platform, deliver a file associated with the Included Programs named “HDCP.SRM” and, if present, pass such file to the HDCP source function in the set-top box as a System Renewability Message; and

2.3.2.2. Verify that the HDCP Source Function is fully engaged and able to deliver the Included Programs in a protected form, which means:

2.3.2.2.1. HDCP encryption is operational on such output,

2.3.2.2.2. Processing of the System Renewability Message associated with the Included Programs, if any, has occurred as defined in the HDCP Specification, and

2.3.2.2.3. There is no HDCP Display Device or Repeater on such output whose Key Selection Vector is in such System Renewability Message.

2.4A Exception Clause for Standard Definition, Uncompressed Digital Outputs on Windows-based PCs, Macs running OS X or higher and PCs running Chrome OS with a Widevine DRM described in Clause 1.2.3): HDCP must be enabled on all uncompressed digital outputs (e.g. HDMI, Display Port), unless the customer’s system cannot support HDCP.

2.4. In the event that Licensor provides to any entity to whom it licenses in the Territory, feature films or television programming with similar or earlier windows as the Included Programs licensed to Licensee hereunder an exception or allowance to any digital output requirement set forth herein, and such entity's content protection system, delivery mechanism and usage model are comparable to Licensee's, as reasonably determined by Licensor, Licensor will discuss in good faith with Licensee whether such an allowance would apply to Licensee hereunder.

2.5. The Content Protection System shall prohibit recording, transfer or copying of protected Included Programs onto recordable or removable media except as explicitly provided for in the Usage Rules.

2.6. The Content Protection System shall prohibit recording, transfer or copying of Included Programs onto external devices except as explicitly provided for in the usage rules or the definition of Approved Device.

2.7. For Approved Devices with High Definition output capability, standard definition Included Programs will be delivered to the device at a pixel resolution no greater than 345,600 visible pixels (in the case of NTSC), or 414,720 visible pixels (in the case of PAL), but the applicable Approved Device may up-scale such Included Programs to High Definition resolutions while maintaining all relevant output protections; provided that Licensee shall not advertise or represent the exhibition of such standard definition Included Programs as “high definition”.

2.8. High Definition streams (for Included Programs authorized by Licensor for transmission in High Definition) shall run up to a pixel resolution of 2,073,600 visible pixels delivered at a variety of bit-rates, up to a maximum of 10Mbps average bit rate.

3. Watermarking Requirements.

3.1. The Content Protection System must not remove or interfere with any embedded watermarks in any Included Program; provided, however, that nominal alteration, modification or degradation of such embedded watermarks during the ordinary course of Licensee’s encoding, encryption and/or distribution of Included Programs shall not be a breach of this Clause 3.1.

4. Geofiltering.

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4.1. The Content Protection System shall take affirmative, reasonable measures to restrict access to Included Programs to within the Territory.

4.2. Licensee shall periodically review the geofiltering tactics and perform upgrades to the Content Protection System to maintain “state of the art” geofiltering capabilities.

[4.3.] Without limiting the foregoing, Licensee shall utilize geofiltering technology in connection with each Registered User Transaction that is designed to limit distribution of Included Programs to Registered User in the Territory, and which consists of (i) for IP-based delivery systems, IP address look-up to check for IP address within the Territory and (ii) either (A) with respect to any Registered User who has a credit card or other payment instrument (e.g. mobile phone bill or e-payment system) on file with the Licensed Service, Licensee shall confirm that the payment instrument was set up for a user within the Territory or (B) with respect to any Registered User who does not have a credit card or other payment instrument (e.g. mobile phone bill or e-payment system) on file with the SVOD Service, Licensee will require such Registered User to enter his or her home address (as part of the Registered User Transaction) and will only permit the Registered User Transaction if the address that the Registered User supplies is within the Territory. [#As per discussion between Tim and Mitch Zollinger.][SPETW: we need to have reinstated our standard requirement and have request a broad (not just technical) discussion on this topic]

[5.] Embedded Information. Licensee’s delivery systems shall “pass through” any embedded copy control information without alteration, modification or degradation in any manner without intentional alteration, modification or degradation in any manner.

5.[6.] Network Service Protection Requirements.

5.1.[6.1.] All Included Programs in Licensee’s possession must be received and stored at content processing and storage facilities in a protected format using an approved protection system. Access to such Included Programs must be limited to authorized personnel who need such access for operational purposes and Licensee shall maintain auditable records of actual access.

5.2.[6.2.] Document security policies and procedures shall be in place. Documentation of policy enforcement and compliance shall be continuously maintained.

5.3.[6.3.] Physical access to servers must be limited and controlled and must be monitored by a logging system.

5.4.[6.4.] Auditable records of access, copying, movement, transmission, backups, or modification of Included Programs not encrypted with at least AES128 or the equivalent and of encryption keys for such Included Programs in Licensee’s possession must be securely stored for a period of at least one year.

5.5.[6.5.] Content servers must be protected from general internet traffic by “state of the art” protection systems including, without limitation, firewalls, virtual private networks, and intrusion detection systems. All systems must be updated, per Licensee’s standard operational procedures, to incorporate the latest security patches and upgrades. For the avoidance of doubt, Licensee may put encoded encrypted content onto internet facing servers for use by Approved Devices and. [TW: our deletion of Netflix Branded Applications here was Accepted].

5.6.[6.6.] All facilities which process and store Included Programs not encrypted with at least AES128 or the equivalent and encryption keys for such Included Programs must be available for Motion Picture Association of America and Licensor audits at times and places to be mutually agreed upon by Licensor and Licensee; provided, however, that any such inspection is conducted during Licensee’s normal business hours and does not materially interfere with Licensee’s operations or confidentiality obligations to third parties.

5.7.[6.7.] Any changes to Licensee’s security policies or procedures set forth in this Clause 6 that would materially and negatively affect the protection provided to Included Programs must be submitted to Licensor for approval.

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5.8.[6.8.] Each Included Program must be returned to Licensor or securely destroyed pursuant to the Agreement at the end of such program’s License Period including, without limitation, all electronic and physical copies thereof.

6.[7.] PVR Requirements. Any device receiving playback licenses must not implement any personal video recorder capabilities that allow recording, copying, or playback of any Included Program except as explicitly specified in the Usage Rules.

7.[8.] Unencrypted Audio. Notwithstanding anything herein to the contrary, unencrypted streaming of audio files associated with Included Programs shall be permitted; provided that if Licensor reasonably determines that the streaming of unencrypted audio files associated with Included Programs is a source for theft or piracy of such audio, the parties agree to discuss in good faith whether the streaming of unencrypted audio files should continue to be permitted.

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Schedule C

License Fees

Library Features: [#Yrs 1 amts are correct. Andreas to confirm Yrs 2 and 3.]

Tier License Fee* per Included Program (USD)Avail Year 1 Avail Year 2 Avail Year 3

Tier A $45,000 $49,500 $54,450 Tier B $25,000 $27,500 $30,250 Tier C $15,000 $16,500 $18,150 Library DTV / MOW $10,000 $11,000 $12,100

Television Series:

Category License Fee* per episode (USD)Avail Year 1 Avail Year 2 Avail Year 3

Current Series – 1 Hour $12,500 $13,750 $15,125 Current Series – Half Hour $9,000 $9,900 $10,890 Non-Returning Series – 1 Hour $6,500 $7,150 $7,865 Non-Returning Series – Half Hour $4,500 $4,950 $5,445 Library Series – Tier A $3,500 $3,850 $4,235 Library Series – Tier B $3,000 $3,300 $3,630 Library Series – Tier C $2,500 $2,750 $3,025 Animated Half Hour $1,500 $1,650 $1,815

[#House of Cards]

* In the event that any Included Program(s) are not made available to Licensee for exploitation in all countries in the Territory, the License Fee for such Included Program(s) shall be reduced by the applicable percentage(s) set forth below:

Territory % AllocationFinland 15%Norway 20%Denmark 25%Sweden 40%

[#Delivery costs – see exhibit F]

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Schedule D Usage Rules

1. Playback Client

a. Each Playback Client must be uniquely identifiable.

b. Each Playback Client must be registered with a Registered User’s user account (each, a “User Account”) prior to receiving Included Programs or playback licenses.

2. User Accounts

a. Registered Users must have an active User Account prior to viewing an Included Program on the SVOD Service.

b. All User Accounts must be protected via account credentials consisting of at least a user-ID and password.

c. A Playback License (as described below) must timeout after 24 hours.

d. All User Accounts must have full account privileges applicable to such account, including purchasing power and the power to change account options, such that access to the account credentials (username and password) is sufficient to (i) enable purchases to be made and charged to the Registered User who is the account owner and (ii) change account options and subscription tiers to the extent applicable to such account.

3. Each User Account can have a maximum of 6 registered Playback Clients at a time. Playback Clients may be de-registered pursuant to Licensee’s standard de-registration procedures, which allows Playback Clients to be de-registered from either the client or the server side. After de-registration, a Registered User must re-present valid account credentials before Included Programs can be received and viewed.

4. Rendering of Included Programs on a Playback Client shall be possible only by the possession on the Playback Client of a Playback License or via Link Layer Protection Playback (which is playback via a secure streaming protocol which is an Approved Protection System where the issuance of a Playback License is not required).

5. Playback Licenses for all CPS except Link Layer Protection (which shall nonetheless meet the standard of this Clause 3 by providing for an analogous level of protection, pursuant to the Link Layer Protection Playback Business Rules set forth at Clause 3(l) below):

a. Only a single Playback License shall be issued per viewing of an Included Program.

b. Each Playback License shall be restricted to only registered Playback Clients.

c. Playback Licenses shall not be transferable or copyable between Playback Clients.

d. Included Programs not playable without a Playback License.

e. Only Licensee can provide Playback Licenses for Included Programs on the SVOD Service.

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f. Playback Licenses must be acquired at the start of viewing of an Included Program, and cannot be cached or stored on the applicable Approved Device after the earlier of viewing being stopped or 24 hours after the playback license was issued.

g. Playback Licenses are only delivered to Registered Users with User Accounts in good standing.

h. Playback Licenses shall expire period within 24 hours of being issued. Resuming playback (after a stop) of a previously viewed (including partially viewed) stream requires acquisition of a new playback license.

i. If a playback client receives a new Playback License while it already has a Playback License or is playing an Included Program authorized by another Playback License, any Included Program playing shall terminate, and the new Playback License shall replace any existing Playback Licenses.

j. Each playback client may only have a single stream at a time (other than in the case of “picture-in-picture” streaming, in which case each such stream to the same device shall be counted towards the concurrent stream limit set forth in subClause m. below).

k. Prior to issuing a Playback License, a playback client must be authenticated with its associated User Account using the User Account credentials.

l. Link Layer Protection Playback Business Rules:

i. Only a single stream shall be initiated per viewing of an Included Program.

ii. Each stream shall be restricted to only registered Playback Clients.

iii. Streams shall not be recordable, copyable or transferable between Playback Clients.

iv. Included Programs are not playable without proper authorization by Licensee.

v. Only Licensee can provide streams for Included Programs on the SVOD Service.

vi. Streams cannot be cached or stored on the applicable Approved Device after the earlier of viewing being stopped or 24 hours after the start of playback.

vii. Streaming sessions shall expire in a period within 24 hours of being initiated. Resuming playback (after a stop) of a previously viewed (including partially viewed) stream requires initiation of a new stream.

viii. If a Playback Client receives a new stream while an existing stream was already in progress, any Included Program currently playing shall terminate, and the new stream shall replace any existing streams.

ix. Only a single streaming instance shall be allowed per Approved Device at any one time.

x. Prior to starting a streaming instance, a playback client must be authenticated with its associated User Account using the User Account credentials.

m. Only two (2) streaming instances (including any combination of Playback Licenses plus Link Layer Protection) may be active at one time associated with a single base level User Account (i.e., the lowest priced unlimited streaming plan); provided however, that nothing contained

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herein shall prevent Netflix from allowing Registered Users to add additional concurrent streams up to a maximum of four (4) concurrent streams for an additional fee. As of the Effective Date, Netflix represents that it has agreements for the Territory with no less than three (3) Major Studios which permit at least four (4) concurrent streams per Registered User.

n. Streaming is only allowed to Registered Users with User Accounts in good standing.

6. Fraud Detection

a. Licensee shall require that each Registered User has agreed to be bound by and comply with the SVOD Service’s terms and conditions, which terms shall, at a minimum, set forth the permitted use of Included Programs by a Registered User, including that such programs are available to members for personal, non-commercial use only. Licensee will establish commercially reasonable procedures in accordance with prevailing industry standards to provide for appropriate action to be undertaken, in Licensee’s good faith discretion, with respect to any Registered User who violates the Terms of Use. Licensee shall use commercially reasonable efforts to ensure that Playback Licenses for a single account are only delivered to the relevant account holder, which may include members of a single household only.

b. Licensee will use appropriate anti-fraud heuristics to prevent unauthorized access of User Accounts. As part of this effort, Licensee will monitor operational statistics from the back end (for example, number of streams per Registered User in a given period, diversity of stream session locations in a given period, amount and location of concurrent sessions, etc.) to evaluate potential fraud.

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Schedule E

Technical Specification

[attached]

SD - File HD - File - 2DDelivery Spec ProRes - ProRes 422 HQ

Audio OV 5.1 (where available, otherwise stereo or mono)

Localized Language 5.1 (where available, otherwise stereo or mono)

Aspect Ratio 16x9 OAR (where available, otherwise 16x9 FF or 4x3)

Subtitles Where Available: .STL, separate not burnt in

Conforming and Delivery Costs

Sub-TitlesIncluded Program Conforming and Delivery Costs (USD)Library Feature $2,500TV Series – 1 Hour $1,350TV Series – Half Hour $750

DubsIncluded Program Conforming and Delivery Costs (USD)Library Feature $1200TV Series – 1 Hour $800TV Series – Half Hour $400

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Author, 08/29/12,

To be discussed.

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