A. Creative Services (See Section 4.05(e))
LLC will provide Cinemark with up to 1,000 hours per year associated with Creative Services in conjunction with the creation of certain
elements of the Pre-Feature Program (including the Policy Trailer, the Brand, and the Branded Slots, but excluding the Digital Programming Event Pre-Feature Program, Event Sponsorships and Branded Slots used for the promotion of Digital Programming
Events) and Video Display Program (but excluding materials used for the promotion of Digital Programming Events) at no charge. Additional hours will be billed as set forth in item 2 below. The Creative Services provided at no cost may not include
creation of Strategic Programs or any materials in connection with Digital Programming Events or Event Sponsorship.
Creative Services include the provision of (i) concept work, idea creation, scripting, treatments,
storyboarding, timelines and animatics, (ii) execution, animation, production, post production, sound design, final encoding and the preparation of all deliverables, and (iii) project management, meetings, communications, sub contractor
management and all administrative activity related to said creative services.
1. Allocated 1,000 Hours Per Year
All projects will be quoted on a GMH (Guaranteed Maximum Hours) basis by which the Parties will agree to the concept and execution plan of the
project. This agreement may be based on treatments, scripts, storyboards, timelines or animatics and will define the intended scope of all creative projects. LLC will guarantee the total maximum hours allocated to the project regardless of actual
hours invested so long as the defined scope is not increased. Scope increases may cause LLC to allocate more hours to a project and therefore could cause overruns in the projects GMH, resulting in additional hours (and possibly fees). In all
cases, any work resulting in overruns will be communicated to Cinemark by LLC prior to the work actually being done.
There is no specific
deliverable attached to the accrual of hours, meaning that any project cancelled, put on hold, or for which production may extend beyond the anniversary of the agreement, will still have hours accrued against it that were incurred in that
corresponding year. At the end of each calendar year, the balance of hours will be zeroed out. Unused hours will not carry forward. LLC shall provide a quarterly status report to Cinemark of all hours spent on any particular project as well as the
amount of hours spent on an aggregate basis for all projects in any given calendar year.
2. Additional Work
Upon the utilization of 1,000 hours of Creative Services provided by LLC to Cinemark on any combination of projects within one calendar year,
LLC will begin charging exhibitor $[***] per hour for all additional hours, subject to the CPI Adjustment. These charges will be consistent for all Creative Services provided across all creative groups within LLC.