-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EfELH/M6Q+BTCXhDjeHz+vcxD4Pp9DpVg4dO84zuLC3rQMcT3OxvSTtop2gczzlm Sxv1BdhFjO7ROYUh6xIZ3Q== 0000950132-96-000630.txt : 19961017 0000950132-96-000630.hdr.sgml : 19961017 ACCESSION NUMBER: 0000950132-96-000630 CONFORMED SUBMISSION TYPE: S-1/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19961016 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIN COMMUNICATIONS CORP CENTRAL INDEX KEY: 0001020391 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 251795265 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-1/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-10447 FILM NUMBER: 96644249 BUSINESS ADDRESS: STREET 1: 300 GREENTREE COMMONS, STREET 2: 381 MANSFIELD AVENUE CITY: PITTSBURGH STATE: PA ZIP: 15220 MAIL ADDRESS: STREET 1: 300 GREENTREE COMMONS STREET 2: 381 MANSFIELD AVENUE CITY: PITTSBURGH STATE: PA ZIP: 15220 S-1/A 1 AMENDMENT #3 TO FORM S-1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 16, 1996 REGISTRATION NO. 333-10447 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------ AMENDMENT NO. 3 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------ ALLIN COMMUNICATIONS CORPORATION (Exact name of Registrant as specified in its charter) DELAWARE 7389 25-1795265 (State or other (Primary Standard (I.R.S. Employer jurisdiction of Industrial Classification Identification No.) incorporation or Code Number) organization) 300 GREENTREE COMMONS 381 MANSFIELD AVENUE PITTSBURGH, PENNSYLVANIA 15220 (412) 928-8800 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) ------------ RICHARD W. TALARICO CHIEF EXECUTIVE OFFICER ALLIN COMMUNICATIONS CORPORATION 300 GREENTREE COMMONS 381 MANSFIELD AVENUE PITTSBURGH, PENNSYLVANIA 15220 (412) 928-8800 (Name, address, including zip code, and telephone number, including area code, of agent for service) ------------ COPIES TO: BRYAN D. ROSENBERGER, ESQ. PETER J. ROMEO, ESQ. ECKERT SEAMANS CHERIN & MELLOTT HOGAN & HARTSON L.L.P. 42ND FLOOR, 600 GRANT STREET 555 13TH STREET, N.W. PITTSBURGH, PA 15219 WASHINGTON, D.C. 20004 (412) 566-6000 (202) 637-5600 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [_] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] ------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. ------------ AMENDING ITEM 16 OF PART II - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN THE PROSPECTUS ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) Exhibits
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT ------- ---------------------- 1 Form of Underwriting Agreement.* 2.1 Stock Purchase Agreement dated August 14, 1996 by and among International Sports Marketing, Inc., Henry Posner, Jr., Thomas D. Wright, Michael J. Fetchko, James C. Roddey, Richard W. Talarico, John F. Hensler and the Registrant.* 2.2 Agreement and Plan of Merger dated August 16, 1996 by and among Kent Consulting Group, Inc., Les Kent and the Registrant.* 3(i)(a) Certificate of Incorporation of the Registrant.* 3(i)(b) Certificate of Designation of the Registrant relating to Series A Convertible Redeemable Preferred Stock.* 3(i)(c) Certificate of Amendment to Certificate of Designation of the Registrant relating to the Series A Convertible Redeemable Preferred Stock.* 3(ii) By-laws of the Registrant.* 4 Certificate of Designation of the Registrant relating to Series A Convertible Redeemable Preferred Stock and Certificate of Amendment relating thereto (filed as Exhibits (3)(i)(b) and 3(i)(c)).* 5 Opinion of Eckert Seamans Cherin & Mellott.* 10.1 Sublease Agreement dated August 1, 1996 between SeaVision, Inc. and Blair Haven Entertainment, Inc.* 10.2 Assignment of Intellectual Property Rights dated October 3, 1994 by Brian K. Blair and R. Daniel Foreman in favor of SeaVision, Inc.* 10.3 Registration Rights Agreement dated July 23, 1996 by and among the Registrant and certain of its stockholders.* 10.4 Registration Rights Agreement dated July 23, 1996 by and among the Registrant and certain of its stockholders.* 10.5 Note Conversion Agreement dated July 23, 1996 by and among the Registrant, Henry Posner, Jr., Thomas D. Wright, Terence M. Graunke, James C. Roddey and Richard W. Talarico.* 10.6 License Agreement dated December 1, 1993 between Major League Alumni Marketing, Inc. and Hawthorne Sports Marketing, Inc.* 10.7 Line of Credit Note, dated May 31, 1996, made by SeaVision, Inc. in favor of Integra Bank.* 10.8 Form of 1996 Stock Plan of the Registrant.* 10.9 Employment Agreement dated August 1, 1996 by and between the Registrant and Richard W. Talarico.* 10.10 Employment Agreement dated August 1, 1996 by and between the Registrant and R. Daniel Foreman.*
II-1
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT ------- ---------------------- 10.11 Employment Agreement dated August 1, 1996 by and between the Registrant and Brian K. Blair.* 10.12 First Amended and Restated Agreement dated June 1, 1996 between SeaVision, Inc. and Celebrity Cruises Inc. (subject to request for confidential treatment). 10.13 Agreement dated February 6, 1996 between SeaVision, Inc. and Carnival Corporation (subject to request for confidential treatment). 10.14 Agreement dated August 8, 1996 by and between SeaVision, Inc. and Norwegian Cruise Line Limited (subject to request for confidential treatment). 10.15 Installation Agreement dated September 9, 1996 by and between SeaVision, Inc. and Cunard Line Limited (subject to request for confidential treatment). 10.16 Concession Agreement dated September 17, 1996 by and between SeaVision, Inc. and Royal Caribbean Cruise Line (subject to request for confidential treatment). 10.17 Employment Agreement dated as of September 16, 1996 by and between the Registrant and Jon E. VanAmringe.* 11 Computation of Earnings per Share.* 21 Subsidiaries of the Registrant.* 23.1 Consent of Eckert Seamans Cherin & Mellott (included in its opinion filed herewith as Exhibit 5).* 23.2 Consent of Arthur Andersen LLP.* 23.3 Consent of Richard S. Trutanic.* 24 Power of Attorney (included in the Signature Page).* 27 Financial Data Schedule.*
- -------- * Previously filed. (b) Financial Statement Schedules. The following financial statement schedule is included in Part II of this Registration Statement and should be read in conjunction with the Financial Statements and notes thereto included elsewhere herein. II. Valuation and Qualifying Accounts II-2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this amendment no. 3 to registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Pittsburgh, Commonwealth of Pennsylvania on October 16, 1996. ALLIN COMMUNICATIONS CORPORATION By: /s/ Richard W. Talarico ----------------------------- Richard W. Talarico Chairman of the Board and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this amendment no. 3 to registration statement has been signed by the following persons in the capacities and on the dates indicated. SIGNATURE TITLE DATE --------- ----- ---- /s/ Richard W. Talarico Chairman of the Board and October 16, 1996 - ------------------------- Chief Executive Officer Richard W. Talarico (principal executive officer) /s/ Jon E. VanAmringe Chief Financial Officer and October 16, 1996 - ------------------------- Treasurer (principal Jon E. VanAmringe financial and accounting officer) * Director October 16, 1996 - ------------------------- R. Daniel Foreman * Director October 16, 1996 - ------------------------- Brian K. Blair * Director October 16, 1996 - ------------------------- William C. Kavan * Director October 16, 1996 - ------------------------- James C. Roddey *By: /s/ Richard W. Talarico ----------------------- Richard W. Talarico Attorney-in-Fact II-3 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To Allin Communications Corporation: We have audited, in accordance with generally accepted auditing standards, the consolidated financial statements of Allin Communications Corporation (a Delaware corporation) and subsidiaries, included in this registration statement and have issued our report thereon dated October 2, 1996. Our audits were made for the purpose of forming an opinion on the basic consolidated financial statements taken as a whole. Schedule II, which is the responsibility of the Company's management, is presented for the purpose of complying with the Securities and Exchange Commission's rules and is not part of the basic consolidated financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic consolidated financial statements and, in our opinion, fairly states in all material aspects the financial data required to be set forth in relation to the basic consolidated financial statements taken as a whole. Arthur Andersen LLP Pittsburgh, Pennsylvania October 2, 1996 S-1 SCHEDULE II ALLIN COMMUNICATIONS CORPORATION VALUATION AND QUALIFYING ACCOUNTS
BALANCE ADDITIONS BALANCE AT CHARGED AT END BEGINNING TO OF OF PERIOD EXPENSES DEDUCTIONS PERIOD --------- --------- ---------- ------- KENT CONSULTING GROUP, INC. Deferred tax asset valuation Year Ended March 31, 1994................ $ -- $60,000 $ -- $60,000 Period Ended December 31, 1994........... 60,000 -- -- 60,000 Year Ended December 31, 1995............. 60,000 -- 60,000 -- Six Months Ended June 30, 1996........... -- -- -- --
S-2 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION OF EXHIBITS ------- ----------------------- 1 Form of Underwriting Agreement.* 2.1 Stock Purchase Agreement dated August 14, 1996 by and among International Sports Marketing, Inc., Henry Posner, Jr., Thomas D. Wright, Michael J. Fetchko, James C. Roddey, Richard W. Talarico, John F. Hensler and the Registrant.* 2.2 Agreement and Plan of Merger dated August 16, 1996 by and among Kent Consulting Group, Inc., Les Kent and Allin Communications Corporation.* 3(i)(a) Certificate of Incorporation of the Registrant.* 3(i)(b) Certificate of Designation of the Registrant relating to Series A Convertible Redeemable Preferred Stock.* 3(i)(c) Certificate of Amendment to Certificate of Designation relating to the Series A Convertible Redeemable Preferred Stock.* 3(ii) By-laws of the Registrant.* 4 Certificate of Designation of the Registrant relating to Series A Convertible Redeemable Preferred Stock and Certificate of Amendment relating thereto (filed as Exhibits (3)(i)(b) and 3(i)(c)).* 5 Opinion of Eckert Seamans Cherin & Mellott.* 10.1 Sublease Agreement dated August 1, 1996 between SeaVision, Inc. and Blair Haven Entertainment, Inc.* 10.2 Assignment of Intellectual Property Rights dated October 3, 1994 by Brian K. Blair and R. Daniel Foreman in favor of SeaVision, Inc.* 10.3 Registration Rights Agreement dated July 23, 1996 by and among the Registrant and certain of its stockholders.* 10.4 Registration Rights Agreement dated July 23, 1996 by and among the Registrant and certain of its stockholders.* 10.5 Note Conversion Agreement dated July 23, 1996 by and among the Registrant, Henry Posner, Jr., Thomas D. Wright, Terence M. Graunke, James C. Roddey and Richard W. Talarico.* 10.6 License Agreement dated December 1, 1993 between Major League Alumni Marketing, Inc. and Hawthorne Sports Marketing, Inc.* 10.7 Line of Credit Note, dated May 31, 1996, made by SeaVision, Inc. in favor of Integra Bank.* 10.8 Form of 1996 Stock Plan of the Registrant.* 10.9 Employment Agreement dated August 1, 1996 by and between the Registrant and Richard W. Talarico.* 10.10 Employment Agreement dated August 1, 1996 by and between the Registrant and R. Daniel Foreman.* 10.11 Employment Agreement dated August 1, 1996 by and between the Registrant and Brian K. Blair.* 10.12 First Amended and Restated Agreement dated June 1, 1996 between SeaVision, Inc. and Celebrity Cruises Inc. (subject to request for confidential treatment). 10.13 Agreement dated February 6, 1996 between SeaVision, Inc. and Carnival Corporation (subject to request for confidential treatment).
EXHIBIT NUMBER DESCRIPTION OF EXHIBITS ------- ----------------------- 10.14 Agreement dated August 8, 1996 by and between SeaVision, Inc. and Norwegian Cruise Line Limited (subject to request for confidential treatment). 10.15 Installation Agreement dated September 9, 1996 by and between SeaVision, Inc. and Cunard Line Limited (subject to request for confidential treatment). 10.16 Concession Agreement dated September 17, 1996 by and between SeaVision, Inc. and Royal Caribbean Cruise Line (subject to request for confidential treatment). 10.17 Employment Agreement dated as of September 16, 1996 by and between the Registrant and Jon E. VanAmringe.* 11 Computation of Earnings per Share.* 21 Subsidiaries of the Registrant.* 23.1 Consent of Eckert Seamans Cherin & Mellott (included in its opinion filed herewith as Exhibit 5).* 23.2 Consent of Arthur Andersen LLP.* 23.3 Consent of Richard S. Trutanic.* 24 Power of Attorney (included in the Signature Page).* 27 Financial Data Schedule.*
- -------- * Previously filed. EX-10.12 2 AGREEMENT WITH CELEBRITY CRUISES INC. Exhibit 10.12 The marked portions of this Exhibit have been omitted and filed separately with the Commission pursuant to a request for confidential treatment. FIRST AMENDED AND RESTATED AGREEMENT THIS FIRST AMENDED AND RESTATED AGREEMENT (this "Agreement"), is made and entered into as of the 1st day of June, 1996, but is effective as of September 1, 1995 (the "Effective Date"), by and between SEAVISION, INC., a Delaware corporation (hereinafter referred to as "SeaVision"), and CELEBRITY CRUISES INC., a Liberian corporation (hereinafter referred to as "Celebrity"). WHEREAS, Celebrity is in the business of offering cruise vacations to its passengers; and WHEREAS, Celebrity desires that its passengers have access to interactive television services on board its vessels; and WHEREAS, Celebrity wishes to earn incremental revenue from such interactive television services; and WHEREAS, the parties previously agreed, pursuant to that certain Agreement dated as of September 1, 1995 (the "Original Agreement"), that SeaVision would provide the aforementioned interactive television services for installation and use aboard the ship m.v. Century (the "Initial Ship") operated by Celebrity; and WHEREAS, since the parties entered into the Original Agreement, SeaVision has installed and commenced operation of the interactive television services on the Initial Ship; and WHEREAS, Celebrity has requested that SeaVision install and operate the interactive television services onboard the ships m.v. Galaxy, m.v. Mercury, m.v. Horizon and m.v. Zenith (collectively, the "Additional Ships"); and WHEREAS, the parties now desire to amend and restate the Original Agreement to provide for their agreements with respect to the Additional Ships; and WHEREAS, for purposes of this Agreement, the Initial Ship and the Additional Ships are sometimes referred to hereinafter collectively as the "Ships" and individually as a "Ship". NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 1. Responsibilities. ---------------- (a) Subject to the terms and conditions hereof, SeaVision hereby agrees to: (i) Provide and, in the case of the Additional Ships, install, at no charge to Celebrity except as otherwise expressly provided in this Agreement, an interactive television system (the "System") on each of the Ships and, in connection therewith, provide the services (the "Services") set forth on Exhibit A attached hereto. SeaVision shall install the System on the Additional Ships pursuant to the implementation schedule set forth on Exhibit B attached hereto. The System installed on the Initial Ship and to be installed by SeaVision on the Additional Ships shall consist of such hardware and software (a listing of which hardware and software shall also be included on Exhibit C attached hereto) as shall be determined and mutually agreed upon by the parties. The applications displays on the television screens will have [Redacted - confidential treatment requested], and the television screens will be subject to Celebrity's approval which shall not unreasonably be withheld, delayed or conditioned. Except as otherwise expressly provided in this Agreement, SeaVision shall at all times retain title to all components of the System, including all hardware and software installed or to be installed by SeaVision on any of the Ships hereunder, unless and until, in respect of any Ship, Celebrity purchases the System pursuant to Section 5 of this Agreement. Notwithstanding the foregoing, (i) Celebrity shall, at its own cost and expense, purchase the components listed on Exhibit D for the Ships m.v. Galaxy and m.v. Mercury; and (ii) upon SeaVision's provision of the components listed on Exhibit D for the Ships m.v. Horizon and m.v. Zenith, Celebrity shall either (A) reimburse SeaVision for the cost of such components (which cost hereby is agreed to be [Redacted - confidential treatment requested] or (B) provide SeaVision with [Redacted - confidential treatment requested] in an aggregate amount such that, [Redacted - confidential treatment requested], SeaVision shall receive funds in the aggregate amount of [Redacted - confidential treatment requested], with the choice of subclause (A) or (B) to be at Celebrity's option. Exhibit H outlines the terms under which Celebrity has agreed to transfer [Redacted - confidential treatment requested]. All such components listed on Exhibit D shall be the property of Celebrity. In connection with SeaVision's performance under this Subsection 1(a)(i), SeaVision shall provide to Celebrity weekly progress reports relating to the -2- delivery of hardware to be provided by SeaVision and, if applicable, the development of System screens. In connection with Celebrity's performance under this Subsection 1(a)(i), Celebrity shall provide to SeaVision weekly progress reports relating to hardware to be provided by Celebrity. The parties hereby agree that, if SeaVision [Redacted -confidential treatment requested], and during the period between the date hereof and such completion date, [Redacted - confidential treatment requested], then SeaVision shall [Redacted - confidential treatment requested]; provided that SeaVision's [Redacted - confidential treatment requested], and SeaVision shall [Redacted -confidential treatment requested]. For purposes hereof, the following are the applicable completion dates for the Additional Ships: m.v. Horizon - September 10, 1996 m.v. Galaxy - October 30, 1996 m.v. Zenith - November 30, 1996 m.v. Mercury - September 15, 1997 (ii) Provide all personnel reasonably necessary and appropriate to install and operate the System and provide the Services onboard the Ships. One (1) SeaVision technician (the "Operator") shall be posted to each Ship following such installation on that Ship to run the System on an on-going basis for so long as this Agreement shall be in effect in respect of that Ship. SeaVision hereby acknowledges that the Operators shall at all times be employees of SeaVision, and Celebrity shall serve as SeaVision's paying agent for payment of all salary, payroll taxes and fringe benefits costs in connection with the Operators, and SeaVision shall promptly reimburse Celebrity for all such costs incurred by Celebrity in respect of the Operators; provided, however, that (i) SeaVision shall not be obligated hereunder to reimburse Celebrity for the cost of protection and indemnity insurance provided by Celebrity pursuant to Section 10 of this Agreement and (ii) SeaVision shall [Redacted - confidential treatment requested]. SeaVision understands that, while on board any Ship, its personnel will be subject to the authority of the Master of that Ship and the officer(s) designated thereon to oversee the installation and operation of the System and the Services. SeaVision shall use its best efforts to ensure that the Operators will at all times while on board any Ship comply with the operations manual of Celebrity, a copy of which is attached hereto as Exhibit E. (iii) Upgrade the hardware and/or software used in the System, at no cost to Celebrity, at such times and in such manner as is reasonably necessary or appropriate to maintain the System on the Ships and to achieve the -3- mutually agreed technical performance standards set forth on Exhibit F attached hereto; provided, however, that any such upgrade shall be subject to Celebrity's prior approval, which approval shall not unreasonably be withheld, delayed or conditioned by Celebrity. Furthermore, Celebrity shall be entitled from time to time [Redacted -confidential treatment requested] to the hardware and/or software used in the System in respect of any Ship in order to keep the System "state-of-the- art" throughout the Operating Term applicable to that Ship. [Redacted - confidential treatment requested], SeaVision shall be obligated to undertake [Redacted - confidential treatment requested] only if and to the extent SeaVision and Celebrity agree such [Redacted - confidential treatment requested], and the terms upon which it is to be undertaken by SeaVision, are technologically and economically feasible for SeaVision. (iv) Furnish certain entertainment programming for passengers' viewing on "free" entertainment channels on and through the System on each Ship for which passengers shall not be charged, all as more fully set forth on Exhibit A attached hereto. (v) Allow Celebrity [Redacted - confidential treatment requested] provided by Celebrity to passengers and crew on each Ship. (vi) Operate the System on each Additional Ship for a period of at least 120 days from the date of the commencement of the initial voyage of that Additional Ship with passengers following the completion of the installation of the System thereon. For purposes of this Agreement, such 120-day period in respect of any Additional Ship is sometimes referred to as the "Initial 120-Day Period". (b) Subject to the terms and conditions hereof, Celebrity hereby agrees to: (i) Grant SeaVision the exclusive right, for so long as this Agreement is in effect, to develop, install, operate, maintain and improve interactive television services similar in nature or intent to the System and Services located or installed anywhere on any Ship. (ii) Make available (v) each Ship to SeaVision personnel for SeaVision's installation and operation of the System thereon, including but not limited to granting SeaVision personnel (A) unlimited access to the television studio and radio frequency distribution system installed or to be installed by Celebrity on board that Ship which television studio and radio frequency distribution system shall include the "central studio equipment," the "distribution plant" and a portion of the "head-end", -4- designated as such in Exhibit G attached hereto and (B) limited access to passenger cabins, (w) all storage and work space necessary on board each Ship for the installation and operation of the System, (x) such personnel as are reasonably necessary or appropriate to assist in the successful installation and operation of the System, including but not limited to appropriate on-board support for and oversight of the installation and operation of the System by a designated officer on each Ship, (y) all necessary systems integration support to allow the System to communicate with other on-board systems, and (z) when any Ship is not under construction, appropriate accommodations on board that Ship for SeaVision personnel who are engaged in installing and/or operating the System on that Ship. It is understood that SeaVision personnel occupying such accommodations will, at all times while on board that Ship, be subject to Celebrity's policies regarding on-board contractors, including those concerning dress, decorum and personal behavior. (iii) Provide SeaVision with copies of the detailed plans, specifications, blueprints and designs which relate to the television studio, video distribution system, radio frequency plant, shipboard information systems and passenger cabin television on each Ship. (iv) Furnish accommodations on board each Ship and otherwise respond favorably to reasonable requests by SeaVision's management for accommodations on board each Ship, on mutually-agreeable dates, for the purpose of evaluating the System and its performance during a "start-up" period of not less than 120 days and not more than 180 days from the date of the commencement of the initial voyage of the Ship with passengers after the installation thereon of the System. Thereafter, in respect of each Ship, Celebrity shall provide SeaVision management with accommodations aboard that Ship, on mutually-agreeable dates, to allow SeaVision senior personnel to monitor the on-going performance of the System and SeaVision's personnel, for the purpose of determining whether such enhancements and improvements to the System should be recommended as they shall, in their sole discretion, deem appropriate. Requests for such accommodations shall not exceed [Redacted - confidential treatment requested]. Celebrity will endeavor to provide to each Operator accommodations comparable to those provided by Celebrity to [Redacted - confidential treatment requested]. Celebrity will provide each Operator with all other on-board privileges that it provides to [Redacted - confidential treatment requested]. (v) Provide any and all reasonable marketing support for the System on-board each Ship. Such marketing support shall include but not be -5- limited to in-cabin collateral material, mention by the Cruise Director during his introductory remarks to passengers on that Ship, prominent coverage in the daily program circulated on that Ship, insertion of promotional materials in passenger documentation, and such other activities of a supporting nature as are acceptable to both parties to this Agreement. All such marketing support activities and material shall be subject to Celebrity's prior approval which shall not unreasonably be withheld, delayed or conditioned. To the extent such marketing materials are produced by Celebrity and do not result in [Redacted -confidential treatment requested] to Celebrity, there shall be [Redacted - confidential treatment requested] to SeaVision in respect of such marketing materials. Any other marketing materials produced shall be subject to SeaVision's prior written approval, which shall not unreasonably be withheld, delayed or conditioned, [Redacted -confidential treatment requested]. (vi) Work with SeaVision's marketing personnel to develop appropriate and effective means acceptable to Celebrity for testing and gauging passenger reaction to the System on a regular basis during and after the installation of the System on any Ship. Such means shall include but not be limited to on-board questionnaires, on-board focus groups, one-on-one passenger interviews and post-cruise questionnaires. Such activities will be conducted by individuals mutually acceptable to Celebrity and SeaVision, and the results of all such activities shall be made available to Celebrity and SeaVision. The results of all such activities shall constitute Celebrity's proprietary information for purposes of this Agreement. (vii) Use its best efforts in respect of each Ship to cause its on- board concessionaires to work with SeaVision to develop mutually beneficial applications for the System. (viii) Consider requests by SeaVision to provide access to any Ship when that Ship is in port for SeaVision personnel to demonstrate the System to potential advertisers, marketers and clients. In connection with making such demonstrations, SeaVision shall conform to Celebrity's procedures for approving on-board visitors, including but not limited to making advance requests for boarding passes. (ix) Provide each Operator with the following data in electronic form (i.e., diskettes, tapes, or other similar means) with respect to each passenger on-board the applicable Ship, either directly or through that Ship's property management system: name, age, cabin assignment, dining assignment, and on-board account number. In addition thereto, -6- Celebrity shall provide such Operator with the home address and telephone number of each passenger who requests that SeaVision make or arrange for the delivery of any item to that passenger's home. In respect of dining assignment information, the parties understand that such information, as provided by Celebrity to SeaVision, may not be completely accurate, but that SeaVision will be entitled to rely on such information, as provided by Celebrity, in connection with SeaVision's operation of the System. If such data cannot be available prior to the time of departure of each cruise, Celebrity and SeaVision agree to jointly develop an efficient and effective method for collecting such information in the manner prescribed. Such data is only to be used for such purposes and activities as are expressly authorized by Celebrity. (x) Collect all monies paid by passengers in respect of Services provided on or through the System and charged to the respective on-board account of such passengers. (c) Celebrity also has requested that SeaVision install and operate the System on-board the m.v. Meridian. However, because of the advanced age of that ship, the parties have agreed to further evaluate the economic feasibility of that proposed installation and operation. Accordingly, the parties, by mutual agreement, may add the m.v. Meridian to this Agreement as an Additional Ship, whereupon SeaVision shall install and operate the System on-board the m.v. Meridian pursuant to an implementation schedule mutually agreeable to the parties. If the parties mutually agree to add the m.v. Meridian to this Agreement, the m.v. Meridian shall thereafter be an "Additional Ship" for purposes of this Agreement, and, upon SeaVision's provision therefor of the components listed on Exhibit D, Celebrity shall either (A) reimburse SeaVision for the cost of such components (which cost hereby is agreed to be [Redacted - confidential treatment requested] or (B) provide SeaVision with [Redacted - confidential treatment requested] in an aggregate amount such that, [Redacted - confidential treatment requested], SeaVision shall receive funds in the aggregate amount of [Redacted - confidential treatment requested]. Exhibit H outlines the terms under which Celebrity has agreed to transfer such [Redacted - confidential treatment requested]. 2. Operating Term/Renewal/Option. Unless sooner terminated in accordance ----------------------------- with the terms of this Agreement, the term of this Agreement in respect of any Ship (the "Operating Term") shall commence on the date first written above and expire on [Redacted - confidential treatment requested] (in respect of any Ship, the "Expiration Date"). In the event SeaVision desires to renew this Agreement in respect of the applicable Ship upon any Expiration Date or upon the expiration of any subsequent renewal term, if any, SeaVision will notify Celebrity in writing no less than [Redacted - confidential treatment -7- requested] prior to the Expiration Date or the expiration of such subsequent renewal term, as the case may be, of the terms and conditions which it proposes for the subsequent renewal term. Celebrity may, within [Redacted -confidential treatment requested] its receipt of the proposed terms and conditions, accept the proposal by notifying SeaVision in writing of Celebrity's intention to renew this Agreement in respect of the applicable Ship for a subsequent renewal term upon the terms and conditions proposed by SeaVision. In the event Celebrity agrees to any such renewal proposal, each successive renewal term shall be designed as a "Renewal Term" and shall become a part of the Operating Term in respect of the applicable Ship, each such Renewal Term shall be [Redacted - confidential treatment requested], and the "Expiration Date" in respect of the applicable Ship shall thereafter be the date upon which such Renewal Term expires. In the event Celebrity does not agree to any such renewal proposal, this Agreement shall terminate in respect of the applicable Ship on the Expiration Date or at the end of the then-current Renewal Term, as the case may be. 3. Revenue-Sharing and Payment Terms. --------------------------------- (a) For each calendar month of any Operating Term of this Agreement, the Adjusted Gross Revenues (as defined below) for all cruises completed during that calendar month will be allocated between Celebrity and SeaVision as follows: (i) If the aggregate of all of the Adjusted Gross Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the Effective Date of this Agreement, [Redacted - confidential treatment requested], then Celebrity shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Gross Revenues for cruises completed during that calendar month and shall promptly remit the remaining [Redacted - confidential treatment requested] of such Adjusted Gross Revenues to SeaVision in accordance with this Section 3; or (ii) If the aggregate of all of the Adjusted Gross Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the Effective Date, [Redacted - confidential treatment requested] applicable at the beginning of the then- current annual period commencing on the later of the Effective Date or the most recent anniversary thereof, then Celebrity shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Gross Revenues for cruises completed during that calendar month and shall promptly remit the remaining [Redacted - confidential treatment requested] of -8- such Adjusted Gross Revenues to SeaVision in accordance with this Section 3; or (iii) If the aggregate of all of the Adjusted Gross Revenues generated by all of the Systems then or theretofore installed on- board the Ships, from the Effective Date, [Redacted - confidential treatment requested] and is equal to or exceeds [Redacted - confidential treatment requested] applicable at the beginning of the then-current annual period commencing on the later of the Effective Date or the most recent anniversary thereof, then Celebrity shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Gross Revenues for cruises completed during that calendar month and shall promptly remit the remaining [Redacted - confidential treatment requested] of such Adjusted Gross Revenues to SeaVision in accordance with this Section 3. (b) [Redacted - confidential treatment requested] (c) "Revenue Allocation Shift Amount", for purposes of this Agreement, shall be an amount equal to the [Redacted - confidential treatment requested]. (d) "Adjusted Gross Revenues", for purposes of this Agreement, shall mean the aggregate of (i) all monies paid to Celebrity in connection with passengers' use of the Services provided by or on the System on-board the Ships and charged to such passengers' respective on-board accounts by Celebrity, other than monies paid or payable in respect of [Redacted - confidential treatment requested], and (ii) certain other revenues as described in Exhibit A attached hereto, whether collected by Celebrity or SeaVision, less, in respect of each Ship, (A) the cost to SeaVision of goods sold in the case of products and services sold on the System, (B) the cost to SeaVision of pay-per-view programming provided on the System, (C) the commissions paid by SeaVision for advertising sold on the System, and (D) the cost to SeaVision of [Redacted - confidential treatment requested] produced for the account of SeaVision [Redacted - confidential treatment requested], and less credits paid by Celebrity to passengers in the case of gaming on the System and [Redacted -confidential treatment requested] in respect of transactions on the System. (e) On or before the twenty-first day of each calendar month during any Operating Term of this Agreement, SeaVision shall provide Celebrity with a written report (the form of which shall be mutually agreed upon by the parties) detailing the Adjusted Gross Revenues generated by the System on each Ship on which the System is then installed from cruises completed during the prior calendar month. This report shall govern the determination of fees to be retained by Celebrity and the revenues to be remitted by Celebrity to -9- SeaVision under the terms of this Agreement. SeaVision shall provide any and all hardware and/or software reasonably necessary or appropriate to interface SeaVision's accounting software with the applicable Ship's property management system in order for SeaVision to obtain accurate accounting information for such reports. (f) Celebrity shall remit to SeaVision all Adjusted Gross Revenues generated by the System less Celebrity's share of such Adjusted Gross Revenues as provided in Section 3(a) of this Agreement, and all other amounts due SeaVision as provided in Section 3(d) of this Agreement no more than fifteen (15) days following its receipt of the applicable monthly report from SeaVision. (g) Celebrity shall promptly notify SeaVision of any changes, adjustments or chargebacks (relative to the Adjusted Gross Revenues in respect of any calendar month) of which Celebrity receives notice after it has made a remittance to SeaVision in respect of such calendar month, and together therewith, provide to SeaVision appropriate documentation supporting all such changes, adjustments or chargebacks. In the event properly-supported changes, adjustments or chargebacks result in a reduction of the Adjusted Gross Revenues generated in respect of such calendar month, SeaVision shall, within thirty (30) days of its receipt of the applicable notice and supporting documentation, refund to Celebrity SeaVision's percentage of the aggregate of such changes, adjustments or chargebacks. (h) All advertising and promotional revenues generated by the System on- board any Ship and received by SeaVision, less any amounts payable by SeaVision to any third party in respect thereof, shall be allocated between SeaVision and Celebrity in the same manner and on the same percentages as the Adjusted Gross Revenues are then being allocated between them pursuant to the terms of Section 3(a) of this Agreement. SeaVision shall remit to Celebrity Celebrity's portion of such net advertising and promotional revenues on a calendar month basis not more than fifteen (15) days following the end of each calendar month. 4. Termination. ----------- (a) Celebrity shall have the right to terminate this Agreement in respect of any Ship prior to the Expiration Date applicable to that Ship in the event the System on-board that Ship fails to achieve the technical performance standards set forth in Exhibit F attached hereto. Celebrity may not exercise this right (i) if such technical failure occurs as a result of Celebrity's failure to perform any or all of its obligations under the terms of this Agreement in respect of that Ship; (ii) if such failure is a result of problems encountered with systems and/or operations on-board that Ship other than the System; (iii) prior to the -10- expiration of the applicable Initial 120-Day Period (in respect of any Additional Ship); and (iv) without written notice to SeaVision of its intention to do so and prior to a period of 90 days following such notice in which SeaVision may effect a cure of such failure. Notwithstanding the provisions of the preceding clause (iv), Celebrity shall not be obligated to provide the cure period provided therein more than twice for separate occurrences of the same failure by the System on-board that Ship. In any event in which SeaVision is entitled to or is otherwise granted the cure period provided for in the preceding clause (iv), Seavision shall, within fifteen (15) days following Celebrity's written notice to SeaVision under such clause (iv), provide to Celebrity SeaVision's written response regarding such failure, which response shall set forth SeaVision's assessment of the cause of such failure and SeaVision's plan to rectify such failure. In any event, SeaVision shall make a good faith effort to rectify such failure as promptly as is reasonable under the circumstances and, where appropriate, will implement temporary "work around" solutions until a permanent solution can be implemented. (b) SeaVision shall have the right to terminate this Agreement in respect of any Ship prior to the Expiration Date applicable to that Ship in the event the System fails to achieve the technical performance standards set forth in Exhibit F attached hereto and such failure is the result of problems encountered with systems and/or operations on- board that Ship other than the System or is the result of Celebrity's addition to or replacement of systems and/or operations (whether software, hardware or both) on-board that Ship other than the System and/or the System on-board that Ship fails to achieve the financial performance standards that SeaVision in its sole and absolute discretion shall determine are necessary to warrant its investment in, and its continued operation of, the System on-board that Ship. In the event SeaVision intends to terminate this Agreement in respect of any Ship pursuant to this subsection 4(b), it shall do so in writing to Celebrity no less than thirty (30) days prior to ceasing operations hereunder, which termination notice shall set forth in reasonable detail the reason for SeaVision's election to terminate this Agreement in respect of that Ship. Representatives of SeaVision shall offer to meet with representatives of Celebrity prior to the effectiveness of any such termination. (c) Either party hereto shall have the right to terminate this Agreement, immediately upon written notice to the other party, upon such party being declared insolvent or bankrupt, or making an assignment for the benefit of creditors, or in the event that a receiver is appointed, or any proceeding for appointment of a receiver or to adjudge such party a bankrupt, or to take advantage of the insolvency laws is demanded by, for, or against such party under any provision under the laws of any state or country. -11- (d) Celebrity shall have the right to terminate this Agreement in the event SeaVision defaults in the performance of any material covenant, warranty or agreement made herein (except a failure by the System to achieve certain technical performance standards which is governed by Section 4(a) herein), and such default has not been cured within sixty (60) days after receipt of written notice thereof given by Celebrity to SeaVision. (e) SeaVision shall have the right to terminate this Agreement in the event Celebrity defaults in the performance of any material covenant, warranty or agreement made herein and such default has not been cured within sixty (60) days after receipt of written notice thereof given by SeaVision to Celebrity. (f) Notwithstanding the termination or expiration of this Agreement as provided for in this Section 4 and elsewhere in this Agreement, Celebrity shall continue to owe, and shall promptly pay to SeaVision in accordance with the terms of Section 3 hereof, all amounts set forth in Section 3 that shall have accrued on and prior to the date of such termination or expiration. (g) Subject to the provisions of Section 5, as soon as is practicable after the expiration of this Agreement or any termination of this Agreement in respect of any Ship, SeaVision shall remove the System, including all related hardware and software, and all on-board SeaVision personnel, including without limitation the Operator, from the Ship or Ships affected by the expiration or termination. The parties hereby agree and acknowledge that in accordance with Section 1 hereof, SeaVision will retain title to all components of the System, including all hardware and software installed on board the Ships by SeaVision at any time while this Agreement is in effect, except as otherwise expressly provided in Section 1 hereof. In the event of any such removal, SeaVision shall assure that the television system on the applicable Ship is in operable condition, normal wear and tear of the components thereof excepted. For purposes of the immediately foregoing sentence, SeaVision's obligations are limited to the RF plant, the television sets and the broadcast center of or on the applicable Ship. 5. Celebrity's Right to Purchase. ----------------------------- (a) Anything herein to the contrary notwithstanding, in the event SeaVision elects to terminate this Agreement in respect of any Ship pursuant to Section 4(b), Celebrity shall purchase the hardware furnished by SeaVision for the System on-board that Ship and a non-transferrable license to use the software components of the System (but only on-board that Ship) for an amount equal to [Redacted - confidential treatment requested]. SeaVision will provide support services for such hardware and software upon terms and conditions to be mutually agreed by the parties. Notwithstanding the foregoing, Celebrity's -12- obligations under this Section 5(a) shall be conditioned upon the System then being operational on-board the applicable Ship. (b) At the relevant Expiration Date, Celebrity shall have the right in respect of each Ship to purchase the hardware furnished by SeaVision for the System on-board that Ship and a non-transferrable license to use the software components of the System (but only on-board that Ship) for an amount [Redacted - confidential treatment requested]. Celebrity acknowledges and agrees that its rights under this Section 5(b) shall not be exercisable if, prior to the relevant Expiration Date, SeaVision shall have notified Celebrity of proposed terms for a renewal or extension of this Agreement in respect of such Ship and the parties shall have subsequently been unable to agree on terms for such renewal or extension. 6. Sale or Disposal of the Ship. In the event that Celebrity elects to ---------------------------- sell or otherwise dispose of any Ship, Celebrity promptly shall notify SeaVision in writing of its decision. Upon the sale of any Ship, the new owner shall have the option of assuming this Agreement in respect of that Ship. If the new owner of the Ship elects not to assume this Agreement or in the event Celebrity is disposing of the Ship other than through a sale or transfer (i.e., decommissioning), SeaVision promptly shall [Redacted - confidential treatment requested], and Celebrity shall [Redacted - confidential treatment requested] in respect of such Ship at such time and (ii) the amount of [Redacted - confidential treatment requested], plus the aggregate of [Redacted - confidential treatment requested] annually on-board that Ship, [Redacted - confidential treatment requested] theretofore paid to SeaVision [Redacted - confidential treatment requested] respect of that Ship and less the aggregate of [Redacted - confidential treatment requested] allocated to SeaVision [Redacted - confidential treatment requested]. For purposes of determining the [Redacted - confidential treatment requested], the initial value of the System on-board any Ship shall be [Redacted - confidential treatment requested], which value shall [Redacted -confidential treatment requested], and to which shall be [Redacted - confidential treatment requested], which new additional amounts also shall [Redacted - confidential treatment requested]. In the event of any such removal, SeaVision shall assure that the television system on the applicable Ship is in operable condition, normal wear and tear of the components thereof excepted. For purposes of the immediately foregoing sentence, SeaVision's obligations are limited to [Redacted - confidential treatment requested]. 7. Confidentiality. --------------- (a) Celebrity acknowledges that the System represents and will continue to represent the valuable, confidential and proprietary property of SeaVision. SeaVision is not by this Agreement conveying to Celebrity any exclusive proprietary or other rights in the System, including, but not limited to, any patent, copyright, trademark, service mark, trade secret, trade name or other intellectual property rights, except that Celebrity will have the limited rights expressly set forth in this Agreement. Accordingly, Celebrity acknowledges that, except as expressly provided for in this Agreement, Celebrity possesses -13- no title or ownership of any System or any portion thereof. Celebrity will keep the System free and clear of all claims, liens and encumbrances. (b) Each party agrees, during the term of this Agreement and thereafter, to maintain the confidential nature of the terms and conditions of this Agreement and of any proprietary information shared with it by the other party. The proprietary information shared with Celebrity by SeaVision shall include, but is not limited to (a) any knowledge gained by Celebrity of the System, including but not limited to knowledge of the type, identity, operation or other characteristics of the System's hardware, operating system software and applications software; (b) SeaVision's marketing and sales strategy; (c) the format and context of any and all SeaVision reports, including those for data management, revenue remittance and marketing surveys; and (d) SeaVision's marketing and advertising client list. Celebrity agrees that it will not create or attempt to create, or permit any third party to create or attempt to create, by reverse engineering or otherwise, the source code for the System(s) or any portion thereof. The provisions of this Section 7 apply to the System as delivered to Celebrity by SeaVision for any Ship or as modified or otherwise enhanced by SeaVision and to any proprietary material and information regarding the System that is given to Celebrity prior to, on or after the date of this Agreement. The proprietary information shared with SeaVision by Celebrity shall include, but is not limited to (a) any knowledge gained by SeaVision of Celebrity's other information systems or operating strategies in respect of any Ship; (b) Celebrity's marketing and sales strategy; (c) Celebrity's marketing and advertising client list, including but not limited to the information provided to SeaVision by Celebrity pursuant to the terms of Subsection 1(b)(ix) hereof; and (d) the results of the activities contemplated in Subsection 1(b)(vi) hereof. Notwithstanding the foregoing, each party may use the other's proprietary information in the internal conduct of its business, subject always to the prohibition herein of disclosure. For example (but not in limitation of the foregoing), (i) Celebrity may hereafter work with a third party to [Redacted - confidential treatment requested] so long as Celebrity does not [Redacted - confidential treatment requested] or disclose such [Redacted - confidential treatment requested] to any third party, and (ii) SeaVision may use the information it gains regarding Celebrity's operations in connection with the enhancement and marketing of SeaVision's products so long as SeaVision does not disclose such information to any third party. Notwithstanding anything contained in this Agreement to the contrary, the terms of this Section 7(b) shall survive the expiration or termination of this Agreement and remain in full force and effect for a period of [Redacted -confidential treatment requested] following such expiration or termination. (c) Each party acknowledges that its violation of its confidentiality or non-disclosure obligations under this Agreement may cause irreparable damage to -14- the other that cannot be fully remedied by money damages. Accordingly, in the event of any such violation or threatened violation, the injured party will be entitled, in addition to pursuing any other remedy available to it under this Agreement or at law, to obtain injunctive or other equitable relief from any court of competent jurisdiction as may be necessary or appropriate to prevent any further violations thereof. (d) During any Operating Term and for a period of three (3) years thereafter, neither party shall induce or attempt to induce any employee or consultant of the other to terminate his or her employment or consulting relationship with such other party and shall not solicit any such employee or consultant for employment or consulting services. Notwithstanding anything contained in this Agreement to the contrary, the terms of this Section 7(d) shall survive the expiration or termination of this Agreement and remain in full force and effect for a period of three (3) years following such expiration or termination. (e) Each party agrees to notify the other immediately upon the notifying party's becoming aware of or reasonably suspecting the possession, use or knowledge of all or part of any of the other party's proprietary information by any person or entity not authorized by this Agreement to have such possession, use or knowledge. The notifying party will promptly furnish the other party with details of such possession, use or knowledge, will assist in preventing a recurrence thereof and will cooperate with the other party in protecting the other party's rights in the other party's proprietary information. A party's compliance with the terms of this Section 7 will not be construed as any waiver of the other party's right to recover damages or obtain other relief against the notifying party for the notifying party's breach of its confidentiality or non-disclosure obligations under this Agreement or the negligent or intentional harm to the other party's proprietary rights. 8. Right to Inspect Books and Records. SeaVision and Celebrity shall ---------------------------------- keep full and accurate accounts, records, books, journals, ledgers and data (collectively, "Records") with respect to the business done by each party respectively under this Agreement, which Records shall at all times show truthfully, accurately and fully the compliance by each party with its respective obligations under this Agreement. Each party shall have the right, through its designated representatives, at all reasonable times, upon reasonable advance notice, to inspect the Records of the other as necessary to verify the sales, revenues generated and fees collected pursuant to this Agreement. The parties shall retain all Records at all times during any Operating Term of this Agreement, and for at least three (3) years thereafter, and shall make the Records available to the other party during regular business hours, wherever the Records are maintained, within ten (10) days after receipt of demand for inspection from such other party. Both parties shall maintain the confidential nature of any Records so inspected pursuant to and in accordance with the provisions of Section 7 hereof. -15- 9. Insurance/Waiver of Subrogation. ------------------------------- (a) Celebrity hereby warrants, represents and covenants that it has, and shall maintain for the Operating Term of this Agreement, at its sole expense, all insurance coverages necessary and appropriate to fully and adequately insure the System on-board each Ship for one hundred percent (100%) of the insurable value of that System against any loss or damage whatsoever which may occur while that System is present and/or installed on that Ship. The insurance policy(ies) with respect to such coverage shall each name SeaVision as an additional insured, as its interests may appear. SeaVision shall, from time to time at the request of Celebrity or on SeaVision's own initiative, provide to Celebrity then current replacement cost information for insurable components of the System. Celebrity shall not be in breach of this Section 9(a) so long as, within thirty (30) days after the delivery of any such cost information, the insurance then maintained by Celebrity is consistent with such cost information. In the event that SeaVision receives the proceeds of any such insurance as a result of a casualty affecting the System or any portion thereof on-board any Ship, SeaVision shall apply such proceeds to the repair and restoration of the System on-board that Ship to its pre-casualty functionality; provided, however, that SeaVision shall not be obligated to so apply such proceeds or to repair and restore the System if (i) such proceeds cannot reasonably be expected to fund the full and complete repair and restoration of the System on-board that Ship and Celebrity does not agree to fund the shortfall or (ii) the affected Ship suffers damage as a result of the casualty and Celebrity does not, at the request of SeaVision, deliver to SeaVision Celebrity's written assurance that that Ship likewise will be fully repaired and restored and used to provide passenger service substantially equivalent to the service being provided immediately prior to the casualty. The limitations on SeaVision's liability set forth in Section 13 herein shall not apply to a breach by SeaVision of its obligations hereunder to apply insurance proceeds to the repair and restoration of the System. (b) So long as their respective insurers so permit, neither party hereto shall be liable to the other, or to the insurer of the other, claiming by way of subrogation through or under such other party with respect to any loss or damage, in whole or in part, to the System, to the extent that such other party shall be reimbursed out of that party's insurance coverage carried for such other party's protection with respect to such loss or damage. If so permitted, the parties shall each obtain any special endorsements required by their respective insurance carriers to evidence compliance with the waiver and release set forth herein and shall provide a copy thereof to the other party. 10. Protection and Indemnity Cover. Each Operator and each member of ------------------------------ SeaVision's System installation crews shall be included as crewmembers on Celebrity's -16- protection and indemnity cover for such periods of time as the Operator or crewmember, as the case may be, is posted to a Ship. For the sole purpose of establishing liability for any sickness, personal injury or death incurred or suffered by any Operator or any such crewmember which engaged on, or in the service of any Ship Celebrity shall be considered the employer of that Operator or crewmember. 11. Interruption in Performance. Neither Celebrity nor SeaVision shall be --------------------------- liable to the other for any loss, damage or loss of profits arising out of any interruption or cessation of the Services to be provided hereunder when such interruption or cessation is caused by any circumstance beyond the reasonable control of such party. 12. Indemnification. --------------- (a) SeaVision shall indemnify, defend and hold harmless Celebrity and its successors and assigns from and against any and all liabilities, claims, suits, damages, judgments, awards, penalties, losses and other liabilities (including all related reasonable attorneys' fees, costs and expenses in connection therewith) (collectively referred to hereinafter as "Losses") suffered or incurred by Celebrity by reason of, arising out of or in connection with (x) any negligent, willful or intentional act or omission of SeaVision (or an employee, agent or representative of SeaVision) committed or omitted, as the case may be, in the course of SeaVision's performance of the terms of this Agreement or (y) SeaVision's failure to fully perform the terms of this Agreement. (b) At Celebrity's request, SeaVision will defend, at its own expense, any action brought against Celebrity to the extent that such action is based solely on a claim that the System on-board any Ship infringes any patent or copyright or the trade secret or other proprietary right of a third party ("Infringement"), and SeaVision will hold Celebrity harmless from any resulting losses, liabilities, damages, costs and expenses, including, without limitation, reasonable attorneys' fees, provided that Celebrity provides SeaVision with prompt written notice of such actions and SeaVision is given an opportunity to defend and/or settle such action. If an infringement covered by the indemnity provisions set forth herein is established by a court of competent jurisdiction in a final decision from which no appeal is or can be taken or if, in the opinion of SeaVision, any such System or any portion thereof is likely to become the subject of such an infringement claim, then SeaVision, at its option, may: (i) modify the infringing or potentially infringing System to make that System noninfringing while maintaining, in SeaVision's reasonable opinion, the equivalent or better functionality; -17- (ii) obtain, on Celebrity's behalf, the right for Celebrity to continue to use the infringing System in accordance with the terms of this Agreement; or (iii) terminate this Agreement in respect of the infringing System(s). (c) Celebrity shall indemnify, defend and hold harmless SeaVision and its successors and assigns from and against any and all Losses suffered or incurred by SeaVision by reason of, arising out of or in connection with (x) any negligent, willful or intentional act or omission of Celebrity (or an employee, agent or representative of Celebrity) committed or omitted, as the case may be, in the course of Celebrity's performance of the terms of this Agreement or (y) Celebrity's failure to fully perform the terms of this Agreement. 13. Limitation of Liability. THE WARRANTIES AND REMEDIES EXPRESSLY SET ----------------------- FORTH IN THIS AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES AND REMEDIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OR ANY IMPLIED WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE. EXCEPT AS EXPRESSLY PROVIDED HEREIN OR ELSEWHERE IN THIS AGREEMENT, IN NO EVENT WILL SEAVISION BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF CELEBRITY'S USE OF OR INABILITY TO USE THE SYSTEM ON-BOARD ANY SHIP OR ANY PORTION THEREOF OR FROM ANY DELAY IN THE SYSTEM ON-BOARD ANY SHIP ACHIEVING THE TECHNICAL PERFORMANCE STANDARDS SET FORTH ON EXHIBIT F ATTACHED HERETO OR FROM ANY DELAY IN THE SYSTEM ON-BOARD ANY SHIP MEETING, OR ANY INABILITY OF THE SYSTEM ON-BOARD ANY SHIP TO MEET, CELEBRITY'S EXPECTATIONS WITH RESPECT TO OPERATIONS OR PERFORMANCE, EVEN IF SEAVISION IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN PARTICULAR, SEAVISION IS NOT RESPONSIBLE FOR ANY COSTS INCLUDING, BUT NOT LIMITED TO, THOSE INCURRED AS A RESULT OF LOST PROFITS OR REVENUE, LOSS OF USE OF THE SYSTEM, LOSS OF DATA, THE COST OF RECOVERING ANY DATA, THE COST OF SUBSTITUTE SOFTWARE, OR CLAIMS BY THIRD PARTIES. IF CELEBRITY TERMINATES THIS AGREEMENT PURSUANT TO THE TERMS OF SECTION 4(A) OR SECTION 4(D) HEREIN, SEAVISION SHALL NOT BE LIABLE FOR ANY OF CELEBRITY'S INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING THEREFROM, BUT SHALL BE LIABLE FOR CELEBRITY'S DIRECT DAMAGES ARISING THEREFROM; PROVIDED HOWEVER, THAT SEAVISION'S LIABILITY FOR SUCH DIRECT DAMAGES SHALL BE LIMITED TO THE AGGREGATE OF (i) [REDACTED - CONFIDENTIAL TREATMENT REQUESTED] -18- IN RESPECT OF EACH SHIP [REDACTED - CONFIDENTIAL TREATMENT REQUESTED] AND (ii) [REDACTED - CONFIDENTIAL TREATMENT REQUESTED] IN RESPECT OF EACH SHIP [REDACTED - - CONFIDENTIAL TREATMENT REQUESTED]. NOTWITHSTANDING THE FOREGOING, UPON THE FIRST SUCH TERMINATION BY CELEBRITY, SEAVISION SHALL BE LIABLE FOR THE GREATER OF (i) [REDACTED - CONFIDENTIAL TREATMENT REQUESTED], SUBJECT TO THE FOREGOING LIMITATION THEREON, OR (ii) [REDACTED -CONFIDENTIAL TREATMENT REQUESTED], REDUCED BY THE AGGREGATE OF ANY PAYMENTS THERETOFORE PAID BY SEAVISION TO CELEBRITY UNDER SECTION 1(a)(i) HEREIN. 14. Further Assurances of SeaVision's Title. --------------------------------------- (a) Celebrity hereby agrees to execute and deliver to SeaVision, prior to the date that installation of any System on any Ship commences, such UCC-1 financing statements and other documents as SeaVision shall reasonably require for the purpose of evidencing to Celebrity and any third party SeaVision's continued ownership of all components (hardware and software) of the System (such financing statements and other documents to describe all such components). (b) SeaVision shall affix permanent (to the degree reasonably possible), legible and visible labels on each component of the System (hardware only), to the extent that doing so is reasonably possible or practicable, prior to the date that installation of the System on- board the applicable Ship commences. Each such label shall clearly indicate that SeaVision holds title to the component to which that label is affixed. 15. No Grant of Intellectual Property Rights. This Agreement does not and ---------------------------------------- shall not grant to Celebrity any patent, copyright, trademark, trade secret or, except as expressly provided in this Agreement, other intellectual property right or license, express or implied. 16. Public Announcements. The parties shall consult with each other and -------------------- issue a public statement with respect to this Agreement and the System as soon as is practical after the date hereof. During any Operating Term, Celebrity shall include a reference to SeaVision in any and all public announcements or marketing materials referring to interactive television or video entertainment services on-board any Ship. 17. Arbitration. In the event of any dispute or controversy arising out ----------- of or related to this Agreement, the parties will seek to resolve any such controversy first by negotiating with each other in good faith in face-to-face negotiations between the respective principals of each. In the event a resolution is not reached in such manner within thirty (30) days after such negotiations, if any, commence, any remaining dispute or controversy shall be submitted to and settled by arbitration as hereinafter provided. Such arbitration shall be conducted in London in accordance with the Arbitration Acts 1950 and 1989 or any re- -19- enactment or statutory modification thereof then in effect. The party desiring such arbitration shall serve upon the other party written notice of its desire, specifying the issues to be arbitrated and the name of the arbitrator whom it appoints. Within fourteen (14) days after notice of such demand for arbitration, the other party shall in turn appoint an arbitrator and give notice in writing of such appointment to the party demanding arbitration. The two arbitrators so appointed shall select a third arbitrator, or if the two arbitrators are unable to agree upon the third arbitrator within fourteen (14) days after the appointment of the second arbitrator, either of the said two arbitrators may apply to the President of the London Maritime Arbitrators Association to appoint the third arbitrator, and the three arbitrators shall constitute the Arbitration Tribunal. If a party fails to appoint an arbitrator as aforementioned within fourteen (14) days following notice of demand for arbitration by the other party, the party failing to appoint an arbitrator shall be deemed to have accepted as its own arbitrator the arbitrator appointed by the party demanding arbitration and the arbitration shall proceed before this sole arbitrator who alone in such event shall constitute the Arbitration Tribunal. The decision rendered by the Arbitration Tribunal shall be final and binding and the appeal by either party to a court in respect of the arbitration award shall be excluded. The arbitration award shall include which party shall bear the expenses of the arbitration or the proportion of such expenses each party shall bear. 18. Right to Make Agreement. Each of the parties hereto represents and ----------------------- warrants to the other that it has all necessary and appropriate power and authority to execute, deliver and carry out the terms and provisions hereof. 19. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall constitute an original and all of which together shall constitute but one and the same original document. 20. Assignment. Except as set forth herein, either party hereto may ---------- assign this Agreement and its respective rights, interests and obligations hereunder to any third party without the consent of the other party hereto; provided, however, that no such assignment by a party shall relieve that party from any of its liabilities or obligations hereunder. It is expressly understood and agreed that this Agreement and all of SeaVision's interests and rights herein and hereunder may be assigned, pledged, mortgaged and/or hypothecated by SeaVision at its exclusive discretion; provided, however, that in no event will the rights hereunder of any pledgee or mortgagee of SeaVision be any greater than the rights of SeaVision hereunder. 21. Successors. This Agreement shall inure to the benefit of, and be ---------- binding upon, the respective successors and assigns of the parties hereto upon its execution by SeaVision and Celebrity, which execution, for purposes of determining the effectiveness of this Agreement, may be evidenced by facsimile transmission of the signature page of this Agreement. -20- 22. Governing Law. This Agreement shall be governed by and construed in ------------- accordance with the laws of England. 23. Severability. If any Section or provision of this Agreement, or any ------------ portion of any Section or provision thereof, shall for any reason be held to be void, illegal or otherwise unenforceable, all other Sections and portions of this Agreement shall nevertheless remain in full force and effect as if such void, illegal or unenforceable portion had never been included herein. 24. Notices. All notices and other communications required or otherwise ------- provided for in this Agreement shall be in writing and sent by registered or certified mail to: If to SeaVision: SeaVision, Inc. 13320 State Route 7 Lisbon, Ohio 44432 Attn: Brian K. Blair If to Celebrity: Celebrity Cruises Inc. c/o Jos. L. Meyer GmbH & Co. Industriegebiet Sud 26871 Papenburg, Germany or to such other place as SeaVision or Celebrity, as the case may be, may from time to time designate in accordance herewith. 25. Entire Agreement; Modification. This Agreement, including the ------------------------------ Exhibits attached hereto, contains the entire agreement of the parties on the subject matter hereof, and supersedes any and all prior agreements, including, without limitation, the Original Agreement, with respect to such subject matter. This Agreement may not be changed, modified or supplemented except by the written agreement of the parties. IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date first above written. ATTEST: SEAVISION, INC. - -------------------- By: --------------------------------- Its: Its: ---------------- -------------------------------- [Signatures continued on next page] -21- [Signatures continued from preceding page] ATTEST: CELEBRITY CRUISES INC. - -------------------- By: --------------------------------- Its: Its: ---------------- -------------------------------- [Signature page to First Amended and Restated Agreement by and between SeaVision, Inc. and Celebrity Cruises, Inc. dated as of June 1, 1996, but effective as of September 1, 1995] EXHIBIT A Entertainment and Interactive Services to be Provided by SeaVision ------------------------------------------------------------------ "Basic" SeaVision Package: Services Provided at No Charge - --------------------------------------------------------- . In-Cabin Room Service Ordering: Passengers will be able to order Celebrity's full or partial room service menu, including beverages charged to their cabin account, through the System. Orders will be printed out in appropriate pantries and/or galleys for delivery by Celebrity personnel. SeaVision shall provide, as part of the System, printers and/or monitors to be used in such pantries and/or galleys for such purpose. . Shore Excursion Ordering: Passengers will be able to watch a preview video of shore excursions and purchase tickets for shore excursions on and through the System by using their television remote-control. Orders will be printed out in the Shore Excursion Office of the Ship, with tickets in respect thereof to be delivered by Celebrity personnel. The System will provide appropriate inventory control. Celebrity shall be responsible for providing all ticket stock and videos in respect of such shore excursions. Celebrity may choose, at its option, to produce its own videos, retain SeaVision for this purpose and reimburse SeaVision for all its costs incurred in connection with producing the same, or contract with a third party to produce such videos, provided, however, that any videos produced by any such third party shall in all ways meet SeaVision's technical standards for use on the System. Should Celebrity elect to have SeaVision produce the shore excursion videos, SeaVision shall provide Celebrity with detailed cost estimates prior to the initiation of video production. Such estimates will include the cost of pre- production scripting and preparation and the cost of sending crews aboard Celebrity's Ships for taping and post-production editing. . Wine Ordering: Passengers will be able to view a video on the System of all wines in inventory and order their selections with their television remote-controls. Orders will be printed out in the Wine Steward's office or wine cellar, for delivery by Celebrity personnel at the designated meal or to the designated cabin. The video review will include the Chef's or Wine Steward's "Tip of the Day." Cabin accounts will be charged accordingly. . Interface with Celebrity's Property Management System: The System will interface with the Ship's property management system to enable appropriate charges to be applied to passenger accounts. A-1 . Access Control: The System will be designed to provide access via the use of a PIN based upon Celebrity's passenger tracking system. Passengers will be able to limit access to various services, such as gaming and adult programming, by enabling lock-out codes and using password procedures. . Report Generation: The System will generate detailed activity reports, which will be made available to Celebrity for the purposes of revenue payments to SeaVision. SeaVision shall also provide, at Celebrity's request, reports pertaining to passenger usage of the System. . Emergency Broadcast System: In the event of an emergency, the System can be directly controlled either by the Master or the Operator to notify passengers and to provide them with instructions. . Passenger Folio Review - Onboard Account: Each passenger will be able to use the System to review a summary of his onboard account. . Spa Service Ordering: Passengers will be able to view a video for the on-board spa services, obtain information with respect to the hours of operation of the spa and make reservations for spa usage. . Language Options: The various preview, ordering and information services provided on the System will be available in English, French, Spanish, Italian and German. . Passenger Questionnaires: Passengers will be able to access an interactive passenger questionnaire on the System to provide input and reactions to the System. . Television Programming: At a time to be mutually agreed upon by SeaVision and Celebrity, but after the maiden voyage of the Ship, SeaVision will provide Celebrity two (2) channels of programming on and through the System for which Celebrity and its passengers will not be charged. SeaVision will provide two (2) channels of programming on and through the System for the crew of the Ship at no charge to Celebrity or the crew. The content of these channels shall be by mutual agreement, but they may include movies, documentaries, original programming and selections from leading cable television vendors. SeaVision reserves the right to market high-quality advertisements, program-length product videos and corporate endorsements on these channels, subject to mutual agreement with Celebrity. A portion of the Adjusted Gross Revenues generated from any such advertisements, program-length product videos and corporate endorsements will be paid to Celebrity pursuant to and in accordance with the terms of Section 3 of the Agreement. A-2 Revenue-Generating and Pay-Per-View Entertainment - ------------------------------------------------- NOTE: Celebrity will be entitled to a portion of the Adjusted Gross Revenues generated by the following services, pursuant to and in accordance with the terms of Section 3 of the Agreement. . Video-on-Demand: Passengers will be able to purchase movies and other entertainment options such as taped concerts, on demand, using the System and their television remote-control. SeaVision shall determine the fee that will be levied for each such order and charged to such passengers' respective cabin accounts. Subject to Celebrity's approval, adult programming may be offered. . Gaming Options: Passengers will be able to view a casino channel which will promote the on-board casino operations and provide instructions for various casino games and the hours of operation for the on-board casino, as well as the opportunity to play video blackjack and poker on the System. Video slots may be offered on the System at a later date. Any additional games that SeaVision may desire to provide on the System shall be subject to the parties' mutual agreement. SeaVision will determine the value of each individual credit that passengers may purchase and charge to their cabin accounts. A limit of [Redacted - confidential treatment requested] will be imposed [Redacted -confidential treatment requested]. Credits may be redeemed at a location designated by Celebrity. SeaVision shall establish and maintain [Redacted -confidential treatment requested] on the Ship in [Redacted - confidential treatment requested]. The gaming options will be activated only with the [Redacted - confidential treatment requested] of Celebrity and [Redacted -confidential treatment requested]. SeaVision will cooperate with Celebrity to conduct limited tests of the gaming options so long as Celebrity reimburses SeaVision for the costs of any modifications which may result from such tests, provided that SeaVision provides written estimates for the costs of any such modifications for Celebrity's prior approval. . Shopping: SeaVision will offer passengers shopping videos and interactive video shopping on and through the System for SeaVision exclusive stores, Celebrity Logo shop and other shopping vendors and suppliers; provided, however, that (i) without Celebrity's consent, SeaVision cannot offer for sale on any Ship any item [Redacted - confidential treatment requested] and (ii) SeaVision and Celebrity will work together in good faith to provide to the gift shop concessionaire or any other concessionaire thereon an appropriate amount of advertising on the System upon terms mutually acceptable to the parties. Celebrity will retain the right to approve the items offered for sale and the vendors providing those items, such approval not to be unreasonably withheld. In the event Celebrity elects to offer its own items for sale on and through the System, SeaVision will be entitled to a share of the Adjusted Gross Revenues A-3 generated therefrom pursuant to and in accordance with the terms of Section 3 of the Agreement. Celebrity will be entitled to a portion of the Adjusted Gross Revenues generated by any fees paid by such purveyors, pursuant to and in accordance with the terms of Section 3 of the Agreement. SeaVision will provide fulfillment services for products sold through the System which are not offered by Celebrity or concessionaires on board the Ship. The shopping options will be activated only with the prior approval of Celebrity and subject to reasonable terms and conditions set forth by Celebrity. SeaVision will cooperate with Celebrity to conduct limited tests of the shopping options so long as Celebrity reimburses SeaVision for the costs of any modifications which may result from such tests, provided that SeaVision provides written estimates for the costs of any such modifications for Celebrity's prior approval. . Advertising and Promotions: SeaVision shall have the exclusive right to provide access to the System to third parties for the purposes of advertising, promotions and marketing of their companies, products or services which are suitable and consistent with Celebrity's image. However, SeaVision agrees to work with Celebrity and within existing agreements and SeaVision will not provide such access to [Redacted -confidential treatment requested] unless such advertising is [Redacted- confidential treatment requested]. Celebrity will have the right to review and approve all such advertising and promotional programs in advance. Additional Services (to be provided after the initial implementation of the - ------------------- System on the Ship and upon the mutual agreement of the parties) . Live Cable Television Programming: SeaVision will use its best efforts to provide Celebrity, if Celebrity so elects, live cable television programming such as CNN and ESPN, at Celebrity's expense. . Video-on-Demand to Crew: SeaVision shall have the option to offer to the crew the same video-on-demand services which are offered to the passengers on the same terms and conditions set forth in the Agreement for such services to passengers or on such other terms and conditions as are mutually agreed to by the parties. . Ship Location Data: Passengers will be able to access a passive application (to be provided by others) which will provide a graphic display of the global position of the Ship, its speed, distance traveled, time remaining to next destination, wind speed, water temperature, time of day, etc. SeaVision will consult with Celebrity regarding the integration of this passive application with the ship's navigational instruments and television distribution system. A-4 . Kiosks: SeaVision will cooperate with third party vendors to integrate the System and its applications into on-board common area touch screen kiosks. . Shipboard Directions Module: Passengers will be able to access an interactive application provided by SeaVision which will provide passengers with directions how to locate and move from one shipboard location to another. . Other Options: The parties will work together to develop and make available other potential revenue-generating services and options on the System. . Additional Non-revenue-Generating Services: To the extent that channels on the System are not then being utilized by SeaVision, Celebrity may use such channels to provide additional non-revenue- generating services to its passengers and/or crew; provided, however, in each instance: (i) such services are approved to SeaVision, which approval shall not unreasonably be withheld, delayed or conditioned; (ii) such services are terminable at any time that SeaVision may elect to utilize the applicable channel in connection with its operation of the System; (iii) Celebrity shall provide an operator and any hardware, software and operations staff required for such services; and (iv) Celebrity shall reimburse SeaVision for any additional cost to SeaVision as a result of such services. In addition thereto, the parties will consider the implementation on the System of services providing daily activities information, cabin maintenance and menu viewing. . Additional Language Modules: SeaVision will develop and install additional language modules for German, French, Spanish and Italian. A-5 EXHIBIT B Implementation Schedule ----------------------- The following is subject to and conditioned upon (i) a definitive Agreement being executed and delivered by SeaVision and Celebrity no later than May 29, 1996, (ii) the availability of Celebrity personnel to review and approve certain content for the navigation screens and video shopping modules in a timely fashion and (iii) delivery of all Celebrity supplied equipment in a timely fashion.
========================================================================================== Task Horizon Galaxy Zenith Mercury - ------------------------------------------------------------------------------------------ Content - revise existing Celebrity 6/12/96 7/31/96 8/30/96 6/16/97 navigation documents for all modules, ITV screens, voice prompting, motion video and animation production. Hardware - engineer, procure, assemble, test and integrate. Interfaces - design interfaces for reservation system, transaction posting via PMS and POS systems. Operations - integrate all ITV related transactions and activities into existing shipboard departmental and operating procedures. - ------------------------------------------------------------------------------------------ Deliver by SeaVision of final content for all 7/31/96 9/18/96 10/18/96 8/4/97 ITV services. Delivery by SeaVision of ITV hardware components on-board the Ship. - ------------------------------------------------------------------------------------------ Complete installation and testing of ITV 8/20/96 10/9/96 11/8/96 8/25/97 server, applications and system interfaces. - ------------------------------------------------------------------------------------------ Complete secondary language module 8/27/96 10/16/96 11/15/96 9/1/97 installation. - ------------------------------------------------------------------------------------------ Complete orientation of on board staff and 9/10/96 10/30/96 11/30/96 9/15/97 crew and complete integration of ITV operating and fulfillment procedures with on board departmental procedures. ======================================================================================
B-1 EXHIBIT C Hardware and Software Components of the System ---------------------------------------------- to be Provided by SeaVision --------------------------- [Redacted - confidential treatment requested] C-1 EXHIBIT D [Redacted - confidential treatment requested] D-1 EXHIBIT E Operations Manual of Celebrity ------------------------------ [Redacted - confidential treatment requested] E-1 EXHIBIT F Technical Performance Standards for the System ---------------------------------------------- [Redacted - confidential treatment requested] F-1 EXHIBIT G Installations to be Provided by Celebrity ----------------------------------------- [Redacted - confidential treatment requested] G-1 EXHIBIT H [Redacted - confidential treatment requested] G-2 EX-10.13 3 AGREEMENT WITH CARNIVAL CORPORATION Exhibit 10.13 The marked portions of this Exhibit have been omitted and filed separately with the Commission pursuant to a request for confidential treatment. AGREEMENT This Agreement, dated as of February 6, 1996, is made by and between SEAVISION, INC., a Delaware corporation (hereinafter referred to as "SeaVision"), and CARNIVAL CORPORATION, a Panamanian corporation (hereinafter referred to as "Carnival"). WHEREAS, Carnival is in the business of offering cruise vacations to its passengers; and WHEREAS, Carnival desires that its passengers have access to interactive television services on board its vessels; and WHEREAS, Carnival wishes to provide passenger services via, and to earn incremental revenue from, such interactive television services; and WHEREAS, SeaVision desires to provide to Carnival, and Carnival desires to obtain from SeaVision, the aforementioned interactive television services for use aboard M/S Imagination (the "Initial Ship") and such other Carnival Cruise Line-brand cruise vessels owned or operated by Carnival or Carnival-owned or Carnival-managed companies as, from time to time, may be designated by Carnival (all such cruise vessels, collectively, the "Ships" and individually, a "Ship"). NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 1. Responsibilities. ---------------- (a) Subject to the terms and conditions hereof, SeaVision hereby agrees to: (i) Provide, for each Ship designated by Carnival (including without limitation the Initial Ship) at no charge to Carnival, an interactive television system (the "System") consisting of the hardware and software described or listed on Exhibit A attached hereto (collectively, the "System Hardware and Software") and, in connection therewith, provide the services (the "Services") set forth on Exhibit B attached hereto. Notwithstanding anything to the contrary elsewhere in this Agreement, if Carnival requests [Redacted - confidential treatment requested] on the television screens, all [Redacted - confidential treatment requested] must be compatible with the then existing technical standards of the System, and Carnival shall bear the cost of the development of [Redacted - confidential treatment requested], which costs will be in accordance with Exhibit C attached hereto. The installation of the System on the Initial Ship will be in accordance with the implementation schedule attached hereto as Exhibit D (the "Implementation Schedule"). Except as expressly provided otherwise in this Agreement, SeaVision shall at all times retain title to all components of the System, including all System Hardware and Software hereafter installed on any Ship hereunder and any non-customized applications screens. (ii) Provide all personnel reasonably necessary and appropriate to operate the System and provide the Services. One (1) SeaVision technician (the "Operator") will remain on-board each Ship on which the System is then installed and operating to operate the System on an on-going basis for so long as this Agreement shall be in effect with respect to that Ship. SeaVision hereby acknowledges that the Operator shall at all times be an employee of SeaVision. Carnival hereby agrees to serve as SeaVision's paying agent for payment, at the direction of SeaVision, of all salary, payroll taxes and fringe benefits costs in connection with the Operator; provided that SeaVision promptly reimburses Carnival for all such costs incurred by Carnival. SeaVision understands that, while on board any Ship, its personnel will be subject to the authority of the Master of that Ship and the officer(s) designated to oversee the operation of the System and the Services. SeaVision shall use its best efforts to ensure that the Operator will at all times while on board any Ship comply with the operations manual of Carnival, in the form then in effect. (iii) Maintain and upgrade the hardware and/or software used in the System, at no cost to Carnival, at such times and in such manner as is reasonably necessary or appropriate, in SeaVision's sole opinion, to maintain the functionality of the System; provided, however, that such upgrades will require Carnival's consent if such upgrades will require significant modifications to Carnival's on-board hardware or software. The implementation schedule for all SeaVision and Carnival upgrades will be subject to the mutual agreement of the parties. (b) Subject to the terms and conditions hereof, Carnival hereby agrees to: -2- (i) Make available to SeaVision on any Ship upon which the System is installed or is then to be installed, (A) all reasonably necessary storage and workspace for SeaVision's installation, operation and maintenance of the System, including but not limited to granting SeaVision personnel reasonable access to the television studio and video distribution system and limited access to passenger cabins on-board such Ship, (B) such personnel as are reasonably necessary or appropriate to assist in the successful installation, operation and maintenance of the System, including but not limited to appropriate on-board support for, and oversight of, the installation, operation and maintenance of the System by a designated officer on such Ship, (C) all necessary Systems integration support to allow the System to communicate with Carnival's on-board systems, and (D) appropriate accommodations on-board such Ship, if necessary, for SeaVision personnel who are engaged in installing, operating or maintaining the System on such Ship; provided, however, that none of the foregoing activities of SeaVision shall unreasonably interfere with the normal functions of such Ship. It is understood that SeaVision personnel occupying such accommodations will, at all times while on-board such Ship, be subject to Carnival's policies regarding on-board contractors, including those concerning dress, decorum and personal behavior. (ii) Furnish [Redacted - confidential treatment requested] accommodations on-board each Ship upon which the System is then installed on mutually-agreeable dates, to allow SeaVision senior personnel to monitor the on-going performance of the System and SeaVision's personnel and for the purpose of determining whether enhancements and improvements to the System should be recommended. (iii) Furnish [Redacted - confidential treatment requested] accommodations to the Operator on board any Ship, which accommodations shall be comparable to those provided by Carnival to [Redacted - confidential treatment requested]. SeaVision understands and agrees that such accommodations may consist of a [Redacted - confidential treatment requested]. Carnival shall also provide the Operator with meals and all other perquisites that it provides to [Redacted - confidential treatment requested]. (iv) Provide reasonable marketing support for the System on board each Ship on which the System is then installed. Such marketing support shall include but not be limited to in-cabin collateral material, mention by the Cruise Director during his or her introductory remarks to passengers on the -3- Ship, coverage in the daily program circulated on the Ship and such other activities of a supporting nature as are agreed to by both parties to this Agreement, including, if so agreed, insertion of promotional materials in passenger documentation. (v) Work with SeaVision's marketing personnel to develop appropriate, effective and non-intrusive means for testing and gauging passenger reaction to the System on a regular basis. Such means may include but not be limited to on-board questionnaires, on-board focus groups, one-on-one passenger interviews and post-cruise questionnaires. (vi) Provide reasonable access to each Ship on which the System is then installed, when such Ship is in port, for SeaVision personnel to demonstrate the System to potential advertisers, marketers and clients. In connection with making such demonstrations, SeaVision shall conform to Carnival's procedures for approving on-board visitors, including but not limited to making advance requests for boarding passes. (vii) Use commercially reasonable efforts to cause its on-board concessionaires to work with SeaVision to develop mutually beneficial applications for the System. (viii) Provide the Operator with the following data, if available, in electronic form (i.e., diskettes, tapes or other similar means) with respect to each passenger on-board any Ship on which the System is then installed: name, home address and telephone number, age, cabin assignment, dining assignment and on-board account number. (ix) Use its best efforts to collect all monies paid or payable by passengers in respect of Services provided on or through the System and charged to the respective on-board account of such passengers. 2. Initial Term/Renewal/Extension to Other Ships. --------------------------------------------- (a) Unless sooner terminated in accordance with the terms of this Agreement, the initial term of this Agreement (the "Initial Term") shall commence on the date first written above and shall expire on [Redacted - confidential treatment requested]. If neither party theretofore exercises its respective rights under Section 5 herein to terminate this Agreement upon or prior to the expiration of the Initial Term, the term of this Agreement shall automatically renew on the expiration of the Initial Term for an additional period of [Redacted - confidential treatment requested]. If, prior to the expiration of the Initial Term or such [Redacted - confidential treatment requested] renewal term, Carnival designates a fourth Ship upon which SeaVision is to install the -4- System (counting the Initial Ship as the first such designated Ship), then upon such designation by Carnival, the remaining term of this Agreement shall be [Redacted -confidential treatment requested], such that the remaining term of this Agreement shall be [Redacted - confidential treatment requested] from the date of such designation by Carnival. Thereafter, unless terminated by either party in accordance with the terms of Section 5 herein, on each occurrence of a date that is [Redacted - confidential treatment requested] prior to the then effective expiration date of the term of this Agreement, the term of this Agreement automatically will be extended for [Redacted - confidential treatment requested] until either party delivers written notice to the other stating that the term of this Agreement will not be further extended. (b) Carnival hereby grants to SeaVision the exclusive right, for the term of this Agreement (subject always to Carnival's rights to terminate this Agreement in accordance with its terms) to install, operate and maintain interactive television systems on the Initial Ship. If Carnival elects from time to time for SeaVision to install, operate and maintain any such additional System(s) in accordance herewith, SeaVision and Carnival shall establish a timetable for the related installation(s). All of the terms and conditions of this Agreement shall apply to the parties' respective rights and obligations in respect of such other Ships and Systems installed thereon. Subject to the foregoing proviso, in the event the parties agree that SeaVision will install, operate and maintain any such additional System(s) on one or more Ship(s), the references herein made to a or any Ship and/or the System shall be deemed to include such other Ship(s) and the System(s) installed thereon, with such modifications as are reasonably necessary and appropriate to reflect the individualized System(s) installed on each such Ship. (c) During the [Redacted - confidential treatment requested] commencing on the date hereof, Carnival shall [Redacted - confidential treatment requested] on board any Carnival Cruise Line-brand cruise vessel. 3. Revenue-Sharing and Payment Terms. --------------------------------- (a) For each calendar month of the term of this Agreement, the Adjusted Net Revenues (as defined below) for all cruises completed during that calendar month will be allocated between Carnival and SeaVision as follows: (i) If the aggregate of all of the Adjusted Net Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the commencement of this Agreement, is [Redacted - confidential treatment requested], then Carnival shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Net Revenues for cruises completed during that calendar month and shall -5- promptly remit [Redacted - confidential treatment requested] of such Adjusted Net Revenues to SeaVision in accordance with this Section 3; or (ii) If the aggregate of all of the Adjusted Net Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the commencement of this Agreement, [Redacted -confidential treatment requested], then Carnival shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Net Revenues for cruised completed during that calendar month and shall promptly remit [Redacted -confidential treatment requested] of such Adjusted Net Revenues to SeaVision in accordance with this Section 3; or (iii) If the aggregate of all of the Adjusted Net Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the commencement of this Agreement, [Redacted - confidential treatment requested], then Carnival shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Net Revenues [Redacted - confidential treatment requested] of the Adjusted Net Revenues [Redacted - confidential treatment requested] for cruises completed during that calendar month and shall promptly remit the remaining [Redacted - confidential treatment requested] of such Adjusted Net Revenues to SeaVision in accordance with this Section 3. (iv) Notwithstanding the foregoing, any [Redacted - confidential treatment requested] for services mutually agreed upon by the parties after the date hereof shall take precedence over the foregoing percentages. (b) "Adjusted Net Revenues", for purposes of this Agreement, shall mean the aggregate of all monies paid to Carnival in connection with passengers' use of the revenue-generating and pay-per-view entertainment Services described on Exhibit B hereto and charged to such passengers' respective on-board accounts by Carnival (monies paid or payable in respect of [Redacted - confidential treatment requested], less (i) the cost to SeaVision of goods sold in the case of products and services sold on the System, (ii) the cost to SeaVision of pay-per-view programming provided on the System, (iii) the commissions paid by SeaVision for advertising sold on the System, (iv) if the aggregate of all of the Adjusted Net Revenues generated by all of the Systems then or theretofore installed on-board the Ships, from the commencement of this Agreement, [Redacted - confidential treatment requested], all costs of the [Redacted - confidential treatment requested] and any other costs incurred by SeaVision [Redacted - confidential treatment requested] which are approved by Carnival in writing, [Redacted - confidential treatment requested] and (vi) credits paid by Carnival to passengers in the case of gaming on the System. -6- Any costs and expenses set forth in the foregoing clauses (i), (ii) and (iii) [Redacted - confidential treatment requested] unless approved in writing by Carnival, which approval shall not unreasonably be withheld, delayed or conditioned. The aggregate amount of any costs and expenses set forth in the foregoing clauses (i) through (iv), inclusive, shall be [Redacted - confidential treatment requested] the aggregate amount of any costs and expenses set forth in the foregoing clauses (v) and (vi), [Redacted -confidential treatment requested] in connection with passengers' use of the revenue-generating and pay-per- view entertainment Services described on Exhibit B hereto and charged to such passengers' respective on-board accounts [Redacted - confidential treatment requested]. (c) On or before the twenty-first day of each calendar month during the term of this Agreement, SeaVision shall provide Carnival with a written report (the form of which shall be mutually agreed upon by the parties) detailing the Adjusted Net Revenues (and the related deductions from gross revenues) generated by the System on each Ship on which the System is then installed from cruises completed during the prior calendar month. This report shall govern the determination of fees to be retained by Carnival and the revenues to be remitted by Carnival to SeaVision under the terms of this Agreement. SeaVision shall provide any and all hardware and/or software reasonably necessary or appropriate to interface SeaVision's accounting software with the applicable Ship's property management system in order for SeaVision to obtain accurate accounting information for such reports. (d) Within thirty (30) days after Carnival's receipt of any monthly report delivered to Carnival by SeaVision pursuant to the terms of subsection 3(c) herein, Carnival shall remit to SeaVision all Adjusted Net Revenues generated by the System on each Ship during the calendar month applicable to such report, less its share of such Adjusted Net Revenues as provided in this Section 3. (e) Carnival shall promptly notify SeaVision of any changes, adjustments or chargebacks (relative to the Adjusted Net Revenues in respect of any calendar month) of which Carnival receives notice after it has made a remittance to SeaVision in respect of such calendar month, and together therewith, provide to SeaVision appropriate documentation supporting all such changes, adjustments or chargebacks. In the event properly-supported changes, adjustments or chargebacks result in a reduction of the Adjusted Net Revenues generated in respect of such calendar month, SeaVision shall, within thirty (30) days after its receipt of the applicable notice and supporting documentation, refund to Carnival SeaVision's percentage of the aggregate of such changes, adjustments or chargebacks. -7- (f) All advertising and promotional revenues generated by any System and received by SeaVision, less any commissions and fees payable by SeaVision to any third party in respect thereof (subject to Carnival's approval thereof in accordance with the terms of section 3(b) in the case of persons affiliated with SeaVision or its principals), shall be allocated between SeaVision and Carnival in the same manner and on the same percentages as the Adjusted Net Revenues are then being allocated between them pursuant to the terms of subsection 3(a) of this Agreement. SeaVision shall detail such gross revenues and expenses on the applicable monthly report provided to Carnival pursuant to the terms of subsection 3(c) of this Agreement and shall retain its own portion of such net revenues together with Carnival's portion of such retained net revenues to the extent of, and as a credit against, Carnival's payment obligations pursuant to the terms of subsection 3(d) of this Agreement for the applicable calendar month. 4. Confidentiality. --------------- (a) Carnival acknowledges that the System represents and will continue to represent the valuable, confidential and proprietary property of SeaVision. SeaVision is not by this Agreement conveying to Carnival any exclusive proprietary or ownership rights in the System, including, but not limited to, any patent, copyright, trademark, service mark, trade secret, trade name or other intellectual property rights, except that Carnival will have the limited rights expressly set forth in this Agreement. Accordingly, Carnival acknowledges that, except as expressly provided for in this Agreement, Carnival possesses no title or ownership of any System or any portion thereof. Carnival will keep the System free and clear of all claims, liens and encumbrances by or through Carnival. (b) Each party agrees, during the term of this Agreement and thereafter, to maintain the confidential nature of the terms and conditions of this Agreement and of any proprietary information shared with it by the other party or obtained by a party from the other party's books, records or computer systems. The proprietary information shared with Carnival by SeaVision shall include, but is not limited to (i) any knowledge gained by Carnival of the System, including but not limited to knowledge of the type, identity, operation or other characteristics of the System's hardware, operating system software and applications software; (ii) SeaVision's marketing and sales materials; (iii) the content of any and all SeaVision reports, including those for data management, revenue remittance and marketing surveys; and (iv) SeaVision's marketing and advertising client list. The proprietary information shared with SeaVision by Carnival shall include, but not be limited to, Carnival's customer lists and passenger information, on-board revenue and expense data, the content of any Carnival reports, and Carnival's business arrangements with -8- concessionaires. Carnival agrees that it will not create or attempt to create, or permit any third party to create or attempt to create, by reverse engineering or otherwise, the source code for the System(s) or any portion thereof. The provisions of this Section 4 apply to the System as delivered to Carnival by SeaVision or as modified or otherwise enhanced by SeaVision and to any proprietary material and information regarding the System that is given to Carnival prior to, on or after the date of this Agreement. Notwithstanding the foregoing, each party may use the other's proprietary information in the internal conduct of its business, subject always to the prohibition herein of disclosure. Notwithstanding anything contained in this Agreement to the contrary, the terms of this subsection 4(b) shall survive the expiration or termination of this Agreement. (c) Each party acknowledges that its violation of its confidentiality or non-disclosure obligations under this Agreement may cause irreparable damage to the other that cannot be fully remedied by money damages. Accordingly, in the event of any such violation or threatened violation, the injured party will be entitled, in addition to pursuing any other remedy available to it under this Agreement or at law, to obtain injunctive or other equitable relief from any court of competent jurisdiction as may be necessary or appropriate to prevent any further violations thereof. (d) During the Initial Term, any extensions thereof, and for a period of three (3) years after the expiration or any termination of this Agreement, neither party shall induce or attempt to induce any employee or consultant of the other to terminate his or her employment or consulting relationship with such other party and shall not solicit any such employee or consultant for employment or consulting services. (e) Each party agrees to notify the other immediately upon the notifying party's becoming aware of or reasonably suspecting the possession, use or knowledge of all or part of any of the other party's proprietary information by any person or entity not authorized by this Agreement to have such possession, use or knowledge. The notifying party will promptly furnish the other party with details of such possession, use or knowledge, will assist in preventing a recurrence thereof and will cooperate with the other party in protecting the other party's rights in the other party's proprietary information. A party's compliance with the terms of this Section 4 will not be construed as any waiver of the other party's right to recover damages or obtain other relief against the notifying party for the notifying party's breach of its confidentiality or non-disclosure obligations under this Agreement or the negligent or intentional harm to the other party's proprietary rights. -9- 5. Termination. ----------- (a) Carnival shall have the right to terminate this Agreement, in its sole discretion, at the expiration of the Initial Term upon [Redacted - confidential treatment requested] prior written notice to SeaVision, such termination to be without any penalty or other charges whatsoever and each party shall thereupon be released from its respective obligations hereunder, except for those obligations which expressly survive the termination of this Agreement. (b) If the term of this Agreement is renewed for an additional period of [Redacted - confidential treatment requested] pursuant to the terms of subsection 2(a) herein, then unless Carnival requests that SeaVision install the System on a fourth Ship, Carnival shall have the right in its sole discretion to terminate this Agreement in its sole discretion upon [Redacted - confidential treatment requested] prior written notice thereof to SeaVision, such termination to be without any penalty or other charges whatsoever and each party shall thereupon be released from its respective obligations hereunder, except for those obligations which expressly survive the termination of this Agreement. (c) SeaVision shall have the right to terminate this Agreement in whole or with respect to any individual Ships prior to the then effective expiration date of the term hereof in the event any System installed by SeaVision aboard any such Ship fails to achieve the financial performance standards that SeaVision shall determine are necessary to warrant its investment in that System. Such determination and termination may occur in respect of all Systems and Ships or on a Ship-by-Ship basis. In the event SeaVision intends to terminate this Agreement pursuant to this subsection 5(c), in whole or in respect of individual Ships and Systems, it shall do so in writing to Carnival no less than six (6) calendar months prior to ceasing operations hereunder or thereon, as the case may be. (d) Either party hereto shall have the right to terminate this Agreement immediately upon written notice to the other party upon such party being declared insolvent or bankrupt, or making an assignment for the benefit of creditors, or in the event that a receiver is appointed, or any proceeding for appointment of a receiver or to adjudge such party a bankrupt, or to take advantage of the insolvency laws is demanded by, for, or against such party under any provision under the laws of any state or country. (e) Carnival shall have the right to terminate this Agreement prior to the then effective expiration date of the term hereof in the event SeaVision defaults in the performance of any covenant, warranty or agreement made herein or if any System fails to achieve the technical performance standards set forth in Exhibit E attached hereto (the "Technical Performance Standards") and such default or -10- failure has not been cured within ninety (90) days after receipt of written notice thereof given by Carnival to SeaVision (except that the foregoing cure period shall not be applicable if SeaVision fails to install the System on the Initial Ship in accordance with the Implementation Schedule). (f) SeaVision shall have the right to terminate this Agreement prior to the then effective expiration date of the term hereof in the event Carnival defaults in the performance of any covenant, warranty or agreement made herein and such default has not been cured within ninety (90) days after receipt of written notice thereof given by SeaVision to Carnival. (g) Notwithstanding the termination or expiration of this Agreement as provided for in this Section 5 and elsewhere in this Agreement, each party shall continue to owe, and shall promptly pay to the other in accordance with the terms of Section 3 hereof, all amounts set forth in Section 3 that shall have accrued on and prior to the date of such termination or expiration. (h) As soon as is practicable after the expiration or any whole or partial termination of this Agreement, but in any event within thirty (30) days thereafter, SeaVision shall, without unduly interfering with the normal functions of any of the Ships, remove from all Ships affected by such expiration or termination, all Systems, including all System Hardware and Software (as the same may have been replaced or supplemented since the date hereof), and all on-board SeaVision personnel. The parties hereby agree and acknowledge that in accordance with Section 1 hereof, SeaVision will retain title to any and all such System Hardware and Software installed on board any Ship by SeaVision (x) at all times while this Agreement is in effect as well as (y) in the event SeaVision chooses not to continue operating the System installed thereon. Notwithstanding the foregoing, if SeaVision elects to terminate this Agreement in respect of any Ship pursuant to the terms of subsection 5(c) above or if SeaVision defaults under this Agreement and Carnival exercises its resulting rights under subsection 5(e) herein, Carnival shall have the right to purchase all SeaVision hardware installed by SeaVision on that Ship and to obtain a nontransferable license to use (but only on that Ship) the SeaVision software installed by SeaVision on that Ship at an aggregate purchase and license price equal to [Redacted - confidential treatment requested]. If SeaVision elects to terminate this Agreement in whole pursuant to the terms of subsection 5(c) above, Carnival shall have the right, in addition to the foregoing purchase and license rights, to purchase such hardware and license such software from SeaVision, for a period of one (1) year thereafter, to enable Carnival to install the System on other Ships, all for an aggregate purchase and license price of [Redacted - confidential treatment requested]. At Carnival's request, SeaVision shall provide support services -11- for such purchased hardware and licensed software upon reasonable terms and conditions to be mutually agreed upon by the parties. 6. Right to Inspect Books & Records. SeaVision and Carnival shall -------------------------------- keep full and accurate accounts, records, books, journals, ledgers and data (collectively, "Records") with respect to the business done by each party respectively under this Agreement, which Records shall at all times show truthfully, accurately and fully the compliance by each party with its respective obligations under this Agreement. Each party shall have the right, through its designated representatives, at all reasonable times, upon reasonable advance notice, to inspect the Records of the other as necessary to verify the sales, revenues generated, third party payments and fees collected pursuant to this Agreement. The parties shall retain all Records at all times during the term of this Agreement and any and all extensions or renewals thereof, and for at least three (3) years thereafter, and shall make the Records available to the other party during regular business hours, wherever the Records are maintained, within ten (10) days after receipt of demand for inspection from such other party. Both parties shall maintain the confidential nature of any Records so inspected pursuant to and in accordance with the provisions of Section 4 hereof. 7. Insurance/Waiver of Subrogation. ------------------------------- (a) Carnival hereby warrants, represents and covenants that it has, and shall maintain for the term of this Agreement and any successive operating term or renewal hereof, at its sole expense, hull and machinery insurance in accordance with American Institute Hull Clauses (June 2, 1977) to cover the System for the value of [Redacted - confidential treatment requested] against any loss or damage whatsoever which may occur while that System is present and/or installed on that Ship. The insurance policy(ies) with respect to such coverage shall each name SeaVision as an additional insured, as its interests may appear and contain a waiver of subrogation against SeaVision. (b) [intentionally left blank] (c) Hull and Machinery Insurance. ---------------------------- (i) In the event that SeaVision or its personnel cause any loss or damage covered by this insurance, or which would have been covered by this insurance but for a commercially reasonable deductible [Redacted - confidential treatment requested] in the insurance policy, SeaVision agrees to reimburse Carnival for the amount of the deductible applicable in such loss or damage. -12- (ii) Neither Carnival, the owner of the Ship, nor the underwriters of the insurance shall have any further right of recovery or subrogation in excess of said deductible against SeaVision on account of loss or damage to the extent covered by such insurance, and the policies of insurance shall be endorsed to reflect this limitation and waiver. (d) Protection And Indemnity Insurance. SeaVision agrees to obtain and ---------------------------------- maintain, at its own expense, insurance to defend and cover its liability, if any, for: (i) Maintenance and cure as well as personal injury or death claims asserted by SeaVision's employees or their estates; (ii) Claims of passengers or other third parties arising out of or in connection with SeaVision's operations or the actions of SeaVision's employees; and (iii) Repatriation, loss of personal effects and other costs to employees (including, without limitation, burial costs) in the event of death, casualty or termination of a voyage. Such insurance shall be in form, in amounts, with carriers and on terms reasonably satisfactory to Carnival's Manager of Insurance; shall name Carnival as an additional insured subject to the misdirected arrow clause. SeaVision shall provide Carnival's Manager of Insurance with a Certificate of Insurance evidencing such coverage. (e) Certificates. On or before the commencement of the term of this ------------ Agreement, Carnival shall, upon SeaVision's written request, provide to SeaVision certificates of insurance evidencing the coverages required pursuant to Sections 7(a), 7(b) and 7(c), and SeaVision shall, upon Carnival's written request, provide to Carnival certificates of insurance evidencing the coverages required pursuant to Section 7(d). 8. Interruption in Performance. Neither Carnival nor SeaVision shall --------------------------- be liable to the other for any loss, damage or loss of profits arising out of any interruption or cessation of the Services to be provided hereunder when such interruption or cessation is caused by a force majeure. For purposes of this Agreement, force majeure shall be any event caused by acts of God, fire, storm or other natural catastrophe, war, labor disruption, change in governmental laws or regulations, and other causes that are unavoidable or beyond the affected party's control. -13- 9. Trademarks. ---------- (a) Nonexclusive License. Carnival hereby represents that it is the owner -------------------- of the trademarks, service marks, tradenames, logos, design marks, names, and designs described on Exhibit F attached hereto, as may be amended in writing by Carnival from time to time hereafter, and such other logos and marks as may be utilized by Carnival anywhere in the world of which SeaVision shall hereafter have received written notice from Carnival (collectively, the "Carnival Marks"). Carnival hereby grants to SeaVision, and SeaVision hereby accepts, for the term of this Agreement, a limited, nonexclusive worldwide license to use the Carnival Marks on and in connection with the design, production and display of video screens for use on the System and the manufacture, promotion and sale of the merchandise (other than perfumes) to be sold via interactive shopping on and through the System (the "Merchandise") in respect to SeaVision's performance hereunder. (b) Restrictions on Assignment of License. SeaVision shall not sell, ------------------------------------- assign or transfer the license granted hereunder without Carnival's express written consent authorized by a duly elected corporate officer of Carnival. (c) Submission of Newly Designed Marks. ---------------------------------- (i) SeaVision shall submit to Carnival (as set forth in subsection 9(c)(ii) of this Agreement) for approval prior to use, all artwork or photostats of artwork, indicating colors and processes of manufacture, of newly designed and not previously approved uses of the Carnival Marks. Carnival shall have the right, in its sole and absolute discretion, to forbid the use thereof. Samples of literature, advertising, catalogs and packaging relating to the souvenirs will be provided on a timely basis by SeaVision to Carnival following printing or production. When using the Carnival Marks, SeaVision agrees to undertake to comply with the requirements of all laws pertaining to trademarks, including marking requirements. Before using any of the Carnival Marks, SeaVision shall inform Carnival of the nature and quality of the souvenirs and shall thereafter promptly furnish samples thereof to Carnival. (ii) Prior to placing any orders for the manufacture of Merchandise on which newly designed and not previously approved uses of the Carnival Mark(s) are intended to be imprinted, SeaVision shall submit for approval the name, address, phone number and telefax number of each manufacturer therefor and, if the manufacturer is satisfactory to Carnival, SeaVision shall subsequently submit to Carnival the artwork, styles, designs, contents, workmanship and quality of such merchandise, in the form requested by Carnival, to the attention of -14- Peter DeMilio or his or her designee in Carnival's Marketing Department, 3655 N.W. 87 Avenue, Miami, Florida 33178. (iii) All materials and information submitted pursuant to this Section 9(c) shall be deemed automatically approved if notification of rejection is not received by SeaVision within forty-five (45) days after Carnival's receipt of such materials and/or information. (d) Purchase Orders. SeaVision shall ensure that all orders it places --------------- with Manufacturers for Merchandise be imprinted with the Carnival Mark(s) have been approved by Carnival as provided in Section 9(c), are paid and delivered to, or otherwise obtained by, SeaVision on a timely basis; and shall use its reasonable best efforts to ensure that the following language is inserted into or delivered for signature with all purchase orders and/or agreements for the manufacture of merchandise to be imprinted with the Carnival Mark(s): Manufacturer agrees to notify Carnival Corporation ("Carnival"), attention Legal Department, 3655 N.W. 87 Avenue, Miami, Florida 33178 (Telefax: 305- 471-4758), by telefax and by certified mail, return receipt requested, in the event SeaVision, Inc. fails to pay for and/or take delivery of any goods and/or merchandise imprinted with the trademarks, service marks, design logos and/or artwork of Carnival (the "Carnival Marks") within forty-five (45) days after receipt of invoice for same; and Carnival shall have the right of first refusal to purchase such merchandise upon the terms thereof. Any merchandise which is not in compliance with the quality and graphics standards issued by Carnival regarding the Carnival Marks of which manufacturer has been informed in writing prior to manufacture shall, wherever possible, be corrected by manufacturer to the specifications of such standards or, if not possible, shall be offered to Carnival at the direct cost of production. (e) Use of Marks, Etc. ------------------ (i) SeaVision shall cause to appear with each use of the Carnival Mark(s) such trademark notice symbols and/or copyright and trade dress notices as shall be instructed in writing by Carnival. Upon receipt of any such instruction by SeaVision, SeaVision agrees to follow Carnival's written policy, as may be amended from time to time, regarding the proper usage of the Carnival Marks on printed material and on goods and merchandise. -15- (ii) SeaVision will in no way represent that it has any right, title and/or interest in and to the Carnival Marks, except as expressly granted under the terms of this Agreement, nor shall SeaVision contest Carnival's title register and the registrations of the Carnival Marks, nor shall SeaVision acquire any rights in the Carnival Marks by virtue of any use it may make thereof. (iii) SeaVision agrees that Carnival is and will be the owner of all goodwill that may in the future attach to the Carnival Marks as a result of SeaVision's use thereof. (iv) SeaVision further agrees that it shall not at any time register or apply to register the Carnival Mark(s) or any trademark, logo, slogan or design confusingly similar thereto anywhere in the world. Upon termination of this Agreement, SeaVision agrees to cease all use of the Carnival Marks or any confusingly similar trademarks or trade names; and SeaVision shall at no time adopt for use any trademarks or trade names confusingly similar to any of the Carnival Marks. (f) Infringements. Carnival shall have the sole right to determine ------------- whether or not any action shall be taken on account of any infringement or imitation of any Carnival Mark; and SeaVision shall reasonably cooperate with Carnival and at Carnival's cost and expense in protecting and defending the Carnival Marks and the Merchandise bearing the Carnival Marks. With respect to infringements of the Carnival Marks, Carnival shall be entitled to receive and retain all amounts awarded as damages, profits or otherwise in connection with such suits. (g) Termination of License. The license in the Carnival Marks granted ---------------------- hereunder shall terminate upon the expiration, suspension or the termination of this Agreement by either party and in accordance with the provisions herein, provided, however, that SeaVision shall thereafter be entitled to sell any inventory of Merchandise on hand or theretofore ordered by SeaVision. (h) Merchandise Bearing the Carnival Marks. Articles of merchandise -------------------------------------- bearing the Carnival Mark(s) may become available to Carnival from time to time from other licensees and sublicensees of Carnival. Carnival may advise SeaVision of such situations, and SeaVision will consider whether or not to purchase, supply and sell such articles of merchandise in its inventory of stock to be sold on the System under the terms and conditions of this Agreement. 10. Matters Relating to SeaVision Employees. --------------------------------------- (a) SeaVision's Obligations. ----------------------- -16- (i) SeaVision's status under this Agreement is solely that of a independent contractor, and SeaVision at all times has the obligation and right to control all of the employees engaged by SeaVision to perform its obligations hereunder, and such persons are solely the responsibility of SeaVision. As between any such employee and SeaVision, SeaVision hereby acknowledges that it is solely responsible for the payment of all wages, vacation pay, benefits and repatriation expenses to each of its employees. (ii) SeaVision may in its sole discretion, at its own expense and without interfering with Carnival's operations, replace its employees or transfer them between the Ships. (b) Responsibility for Payment of Certain Expenses. Except as otherwise ---------------------------------------------- expressly provided in this Agreement (including, without limitation, in subsection 7(c) herein), SeaVision is solely responsible for the payment of any medical and subsistence expenses or damages to SeaVision's employees arising from accident or illness. Except as provided in subsection 10(g)(ii), SeaVision shall indemnify Carnival for any such expenses or damages incurred by Carnival. (c) No Maritime Liens. SeaVision's employees do not have maritime liens ----------------- on a Ship for any payments due to them in connection with their services for SeaVision. (d) Jones Act. SeaVision's employees are not entitled to assert claims --------- against Carnival under Jones Act, 46 U.S.C. 688. (e) Employee Contracts. In each of its written contracts with its ------------------ employees who will serve on any Ship, SeaVision will insert the following notice: "Your employer is a concessionaire of Carnival Corporation, the owner of the Ship. You are subject to the control of your employer. You are also subject to the authority of the Master for purposes of health, safety and discipline. In your dealings with passengers you will refer to yourself as a member of the interactive television system team. However, your employer is solely responsible for you, and neither the Ship nor Carnival Corporation, is obligated to you for any payments. You are required to comply with the terms of any agreement and/or policy now existing, or hereafter entered into or adopted by -17- Carnival Corporation, with respect to the carrying on board the Ship and/or use on board the Ship of any narcotics or other controlled substances that Carnival Corporation may deem necessary or desirable in view of the laws, regulations and policies of any governmental jurisdiction including, without limitation, the zero tolerance policy of the government of the United States of America." (f) Ship's Articles. --------------- (i) SeaVision irrevocably appoints the Master of a Ship as its agent with the power of overall supervision of SeaVision's employees on board the Ship for purposes of health, safety, and discipline. The Master may delegate this supervisory power to the Ship's Staff, Captain and/or Purser. (ii) Only for purposes of health, safety and discipline and to facilitate compliance with the immigration laws applicable in a Ship's base port and other ports of call, SeaVision's employees will sign on ship's articles; but such adherence to ship's articles will not in any way detract from or modify the SeaVision's status as an independent contractor, and its relationship or its right and obligation to control its employees, as described in Sections 10(a) through 10(d), above. Carnival agrees to make all arrangements for SeaVision's employees to sign on and off ship's articles. (g) Health and Documentation. ------------------------ (i) SeaVision will employ on-board the Ship only persons who are of good moral character as well as good health, who hold valid passports, visas, and all other permit required by any governmental authority having jurisdiction, in order that they may enter and leave the base port and other ports where the Ship may call. Carnival agrees to arrange for all on-board immigration formalities and to accept responsibility for safekeeping of all passports or other immigration documents turned over to it by SeaVision's employees. (ii) SeaVision will at its own expense arrange for each of its employees to receive and pass a complete medical examination including a chest x-ray and blood test, immediately prior to serving on-board a Ship and periodically thereafter. The report of such examination shall be forwarded to the Ship's doctor indicating that the employee is medically -18- fit for service on-board the Ship in accordance with standards established by Carnival and applicable to its own crew. (h) Grooming. SeaVision's employees will at all times keep themselves -------- neatly groomed, well spoken, and suitably attired in SeaVision uniforms. (i) Removal. In his/her discretion, the Master of a Ship may require, ------- when he/she determines it necessary in his/her sole discretion to preserve health, safety or discipline on board the Ship, that any employee of SeaVision remove himself/herself and his/her belongings from a Ship at any time when the Ship is in port, and all repatriation expenses, if any, will be for SeaVision's account. SeaVision shall be entitled to appeal such removal by referring the matter to Carnival for final determination, which determination shall be made in good faith. (j) Medical Care. At SeaVision's request, and except as otherwise ------------ provided in Section 10(g)(ii), Carnival will furnish without charge, regular and reasonable on-board medical care by a Ship's doctor, as well as medicines, for illness and injury suffered by SeaVision's personnel while aboard the Ship. (k) Prohibited Items. SeaVision's personnel are not permitted: ---------------- (a) To carry or consume aboard a Ship any firearms or weapons, narcotics, or other drugs which are prohibited in the Ship's ports, except pursuant to a program of medical care under the direct supervision of the Ship's doctor; (b) To consume alcoholic beverages aboard a Ship to the point of intoxication or to the point where, during the subsequent performance of their duties, such consumption could become apparent to the passengers; (c) To board a Ship in an intoxicated state without the consent of the Master; (d) To engage in gambling aboard a Ship in the Ship's casino or amongst themselves, or engage in any other illegal activity; (e) To sell any merchandise to passengers (except in the course of their duties), or to purchase merchandise from the interactive system for resale. -19- 11. SeaVision's Other General Obligations. ------------------------------------- (a) Safe Stowage. Subject to the approval of the Master of the Ship, ------------ which approval shall not be unreasonably withheld or delayed, SeaVision will safely stow for sea and will maintain such safe stowage for sea of all of the System Hardware and Software and its other property, as well as all property belonging to Carnival which SeaVision uses to perform its obligations hereunder. (b) Unseaworthiness. SeaVision will not knowingly or recklessly create an --------------- unseaworthy condition in the performance of its obligations hereunder. (c) Careful Operations. SeaVision will care for the property of a Ship ------------------ utilized by SeaVision in performance of its obligations hereunder in a careful, efficient and businesslike manner. (d) Compliance with Laws. SeaVision will comply with all laws and -------------------- regulations (including but not limited to tax laws and regulations) of all governmental authorities having jurisdiction, relating to gambling, immigration, repatriation and its operations hereunder. Carnival shall likewise reasonably assist and fully cooperate with SeaVision so as to enable SeaVision to comply with such laws and regulations and shall assist SeaVision to obtain any required licenses, permits, approvals and consents. (e) Damaged Property. Each party will, at its own expense, repair or ---------------- replace the other party's property which is damaged by the negligent acts of such other party's employees, over and above normal wear and tear. 12. Cruise Scheduling. Sailing and other cruise periods shall be ----------------- scheduled at the sole discretion of Carnival, who will promptly furnish SeaVision with an initial cruise and overhaul schedule of the Ships as well as all changes to a previously delivered schedule within ten (10) days after such schedule is established or changed. If notice as required herein is given by Carnival to SeaVision, then SeaVision shall have no claim against Carnival for any loss or damage arising from delay, lay up or schedule change of a Ship. 13. Photographs. SeaVision shall not circulate any photographs of its ----------- operations aboard a Ship for promotional purposes without the prior written consent of the persons who are the subject of the photographs and the prior written or oral consent of Carnival, which consent shall not be unreasonably withheld or delayed. -20- 14. Change of Status. ---------------- (a) Sale or Charter of Ship. ----------------------- (i) Carnival may sell or charter a Ship during the term of this Agreement to [Redacted - confidential treatment requested]. Upon [Redacted - confidential treatment requested] prior written notice to SeaVision of the anticipated closing date, [Redacted -confidential treatment requested]. (ii) Upon [Redacted - confidential treatment requested] days prior written notice to SeaVision, Carnival may sell or charter a Ship during the term of this Agreement to [Redacted - confidential treatment requested], provided that [Redacted - confidential treatment requested] (i) has the authority to operate such vessel and [Redacted - confidential treatment requested]. 15. General Average and Salvage. --------------------------- (a) General Average. General Average shall be adjusted at New York --------------- according to York-Antwerp Rules 1974, and as to matters not therein contained, according to the law and usages of the Port of New York. In case a general average statement be required, the same shall be adjusted by an Adjuster to be selected and appointed by Carnival and said Adjuster shall attend to the settlement and collection of the average, subject to the customary charges. Notwithstanding anything herein to the contrary, the property of SeaVision shall not be required to contribute to general average adjustment and shall not be subject to any lien for general average adjustment. (b) Salvage. In the event of accident, danger, casualty, damage or ------- disaster before or after commencement of a voyage resulting from any cause whatsoever, whether due to negligence or not, for which, or for the consequences of which, the Ship is not responsible, by statute or contract or otherwise, SeaVision shall only be required to contribute with the Ship to pay salvage in respect to SeaVision's property; and SeaVision shall not be required to contribute to pay salvage awarded with respect to any other property. (c) Earned Salvage. SeaVision shall not be entitled to participate in -------------- earned salvage. 16. Both to Blame Collision Clause. If a Ship comes into collision ------------------------------ with another ship as a result of the negligence of the other ship, and consequences of which Carnival is not responsible to SeaVision, by statute or contract or otherwise, SeaVision shall indemnify Carnival against all loss or liability of the other ship -21- or her owners insofar as such loss or liability represents loss of or damage to or any claim whatsoever of SeaVision, paid or payable by the other ship or her owners to SeaVision and set off, recouped or recovered by the other ship or her owners as part of their claim against the Ship or Carnival. The foregoing provisions shall also apply where the owners, operators or those in charge of any ship or ships or objects other than or in addition to, the colliding ships or objects are at fault in respect of collision or contact. 17. Termination by Withdrawal or Requisition. ---------------------------------------- (a) Withdrawal of a Ship From Trade. Upon at least [Redacted - ------------------------------- confidential treatment requested] prior written notice to SeaVision (advising SeaVision of the effective date of the withdrawal and the expected period of the withdrawal), Carnival may in its sole discretion withdraw a Ship from the cruise trade ("Withdrawal") and, upon Withdrawal, [Redacted - confidential treatment requested]; provided, however, as to Withdrawals for a duration that will not extend beyond the term of this Agreement, SeaVision shall have the right to cause this Agreement to [Redacted - confidential treatment requested], upon written notice to Carnival. (b) Requisition of a Ship. If any Ship is requisitioned by any government --------------------- (including, but not limited to, the United States of America) for title or use and the requisition remains in effect for thirty (30) calendar days, then this Agreement shall be suspended, but not terminated for the duration of any such requisition. Carnival shall have no liability to SeaVision in regards to the requisition. 18. Indemnification. --------------- (a) SeaVision shall indemnify, defend and hold harmless Carnival and its successors and assigns from and against any and all liabilities, claims, suits, damages, judgments, awards, penalties, losses and other liabilities (including all related reasonable attorneys' fees, costs and expenses in connection therewith) (collectively referred to hereinafter as "Losses") suffered or incurred by Carnival by reason of, arising out of or in connection with (x) any grossly negligent, willful or intentional act or omission of SeaVision (or an employee, agent or representative of SeaVision) committed or omitted, as the case may be, in the course of SeaVision's performance of the terms of this Agreement, (y) SeaVision's failure to fully perform the terms of this Agreement or (z) any infringement or alleged infringement of the Carnival Marks by reason of the sale or delivery by the manufacturer (used by SeaVision) of the merchandise on which the Carnival Marks have been imprinted due to SeaVision's negligent failure to comply with Section 9(d) above, or SeaVision's negligence to use its best efforts to ensure and accept -22- delivery of merchandise ordered by SeaVision on which the Carnival Mark(s) have been imprinted, except as otherwise provided herein. (b) Carnival shall indemnify, defend and hold harmless SeaVision and its successors and assigns from and against any and all Losses suffered or incurred by SeaVision by reason of, arising out of or in connection with (x) any grossly negligent, willful or intentional act or omission of Carnival (or an employee, agent or representative of Carnival) committed or omitted, as the case may be, in the course of Carnival's performance of the terms of this Agreement, (y) Carnival's failure to fully perform the terms of this Agreement or (z) SeaVision's use of the Carnival Marks or any of them in accordance with the terms of this Agreement. 19. Limitation of Liability. THE WARRANTIES AND REMEDIES EXPRESSLY ----------------------- SET FORTH IN THIS AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES AND REMEDIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OR ANY IMPLIED WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE. EXCEPT AS EXPRESSLY PROVIDED HEREIN OR ELSEWHERE IN THIS AGREEMENT, IN NO EVENT WILL SEAVISION BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF CARNIVAL'S USE OF OR INABILITY TO USE THE SYSTEM OR ANY PORTION THEREOF OR FROM ANY DELAY IN THE SYSTEM ACHIEVING THE TECHNICAL PERFORMANCE STANDARDS OR FROM ANY DELAY IN THE SYSTEM MEETING, OR ANY INABILITY OF THE SYSTEM TO MEET, CARNIVAL'S EXPECTATIONS WITH RESPECT TO OPERATIONS OR PERFORMANCE, EVEN IF SEAVISION IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN ADDITION THERETO, SEAVISIONS' LIABILITY FOR DIRECT DAMAGES OF CARNIVAL ARISING OUT OF ANY OF THE FOREGOING SHALL IN NO EVENT EXCEED THE AMOUNT OF [REDACTED - CONFIDENTIAL TREATMENT REQUESTED]. IN PARTICULAR, SEAVISION IS NOT RESPONSIBLE FOR ANY COSTS INCLUDING, BUT NOT LIMITED TO, THOSE INCURRED AS A RESULT OF LOST PROFITS OR REVENUE, LOSS OF USE OF THE SYSTEM, LOSS OF DATA, THE COST OF RECOVERING ANY DATA, THE COST OF SUBSTITUTE SOFTWARE, OR CLAIMS BY THIRD PARTIES. 20. [Redacted - confidential treatment requested] Agreement. At the ------------------------------------------------------- request of Carnival, SeaVision shall enter into an [Redacted - confidential treatment requested] agreement providing for [Redacted - confidential treatment requested] upon terms mutually agreeable to SeaVision and Carnival (including, without limitation, [Redacted - confidential treatment requested] and [Redacted - - confidential treatment requested] mutually acceptable to SeaVision and Carnival. -23- 21. Further Assurances of SeaVision's Title. --------------------------------------- (a) Carnival hereby agrees to execute and deliver to SeaVision, upon the reasonable request of SeaVision from time to time, such UCC-1 financing statements and other documents as SeaVision shall reasonably require for the purpose of evidencing to Carnival and any third party SeaVision's continued ownership of all components (hardware and software) of any System (such financing statements and other documents to describe all such components and to be in the form required by applicable law). (b) SeaVision may affix permanent (to the degree reasonably possible), legible and visible labels on each component of the System (hardware only), to the extent that doing so is reasonably possible or practicable. Each such label may clearly indicate that SeaVision holds title to the component to which that label is affixed. 22. No Grant of Intellectual Property Rights. Except as expressly ---------------------------------------- set forth herein, this Agreement does not and shall not grant to Carnival any patent, copyright, trademark, trade secret or other intellectual property right or license, express or implied. 23. Public Announcements. The parties shall consult with each other -------------------- and issue a public statement with respect to this Agreement as soon as is practical after the date hereof. During the term of this Agreement, Carnival shall include a reference to SeaVision in any and all public announcements or marketing materials referring to interactive television services on-board the Ships. 24. Arbitration. In the event of any dispute or controversy arising ----------- out of or related to this Agreement, the parties will seek to resolve any such controversy first by negotiating with each other in good faith in face-to-face negotiations between the respective principals of each. In the event a resolution is not reached in such manner within thirty (30) days after such negotiations, if any, commence, any remaining dispute or controversy shall be submitted to binding arbitration under the auspices of and in accordance with the then-prevailing Commercial Arbitration Rules of the American Arbitration Association, and any such arbitration shall be conducted in Miami, Florida. The costs and expenses of arbitration, including, without limitation, attorneys' fees, shall be borne ultimately as the arbitrator(s) direct. The parties hereby consent to the jurisdiction of any arbitration held in said locale in accordance and in connection herewith and hereby consent to comply with the decision and any award therein made. The arbitration award may be enforced by any court of competent authority in the same manner as a judgment by a court of law and/or equity. 25. Right to Make Agreement. Each of the parties hereto represents ----------------------- and warrants to the other that it has all necessary and appropriate power and authority to execute, deliver and carry out the terms and provisions hereof and that its execution, delivery and -24- performance thereof will not constitute a default by it under any other agreement to which it is a party. 26. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall constitute an original and all of which together shall constitute but one and the same original document. 27. Assignment. Either party hereto may assign this Agreement and ---------- its respective rights, interests and obligations hereunder to any third party without the consent of the other party hereto; provided, however, that (i) no such assignment by a party shall relieve that party of any of its liabilities or obligations hereunder and (ii) SeaVision may not assign this Agreement or any of its rights or obligations hereunder to any cruise line competitor of Carnival. It is expressly understood and agreed that, except as provided to the contrary in the preceding sentence, this Agreement and all of SeaVision's interests and rights herein and hereunder may be assigned, pledged, mortgaged and/or hypothecated by SeaVision at its exclusive discretion. 28. Successors. This Agreement shall inure to the benefit of, and be ---------- binding upon, the respective successors and assigns of the parties hereto. 29. Effectiveness. This Agreement shall be effective upon its ------------- execution by an authorized representative of each party hereto, which execution may for all purposes be evidenced by facsimile transmission of a counterpart signature page of this Agreement. 30. Governing Law. This Agreement shall be governed by and construed ------------- in accordance with the laws of the State of Florida, without regard to its principles of conflicts of laws. 31. Severability. If any Section or provision of this Agreement, or ------------ any portion of any Section or provision thereof, shall for any reason be held to be void, illegal or otherwise unenforceable, all other Sections and portions of this Agreement shall nevertheless remain in full force and effect as if such void, illegal or unenforceable portion had never been included herein. 32. Notices. All notices and other communications required or ------- otherwise provided for in this Agreement shall be in writing and sent by registered or certified mail to: If to SeaVision: SeaVision, Inc. 13320 State Route 7 Lisbon, Ohio 44432 Attn: Brian K. Blair If to Carnival: Carnival Corporation Carnival Place -25- 3655 N.W. 87th Avenue Miami, FL 33178 Attn: Brendan Corrigan or to such other place as SeaVision or Carnival, as the case may be, may from time to time designate in accordance herewith. 33. Entire Agreement; Modification. This Agreement, including the ------------------------------ Exhibits attached hereto, contains the entire agreement of the parties on the subject matter hereof, and supersedes any and all prior agreements, if any, with respect to such subject matter. This Agreement may not be changed, modified or supplemented except by the written agreement of the parties. IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date first above written. ATTEST: SEAVISION, INC. By: - -------------------- ---------------------------- Its: Its: ---------------- --------------------------- ATTEST/WITNESS: CARNIVAL CORPORATION By: - -------------------- ---------------------------- Its: Its: ---------------- --------------------------- -26- EXHIBIT A Primary Hardware and Software Components of the System ------------------------------------------------------ provided by SeaVision --------------------- [Redacted - confidential treatment requested] -27- EXHIBIT B I. Entertainment and Interactive Services to be Provided by SeaVision ------------------------------------------------------------------ "Basic" SeaVision Package: Services Provided at No Charge - --------------------------------------------------------- . Language Options: The various preview, ordering and information services provided on the System will be available in English, French, Spanish, Italian, Portuguese and German. . In-Cabin Room Service Ordering: Passengers will be able to order Carnival's standard room service menu, including beverages charged to their cabin account, through the System. Orders will be printed out in appropriate pantries and/or galleys for delivery by Carnival personnel. SeaVision shall provide, as part of the System, printers and/or monitors to be used in such pantries and/or galleys for such purpose. . Shore Excursion Ordering: Passengers will be able to watch videos of shore excursions and purchase tickets for shore excursions on and through the System by using their television remote-control. Orders will be printed out in the Shore Excursion Office of the applicable Ship, with tickets in respect thereof to be delivered by Carnival personnel. The System will provide appropriate inventory control or will interface with Carnival's inventory control system. . Wine Ordering: Passengers will be able to view a wine menu on the System and order their selection with their television remote- controls. Orders will be printed out in the Wine Steward's office or wine cellar, for delivery by Carnival personnel at the designated meal. Cabin accounts will be charged accordingly. . Passenger Folio Review: Each passenger will be able to use the System to review a summary of their on-board account. Carnival shall be responsible for providing all ticket stock, videos and photographs for shore excursions and wine ordering. Carnival may choose, at its option, to produce its own videos and photographs, retain SeaVision for this purpose and reimburse SeaVision for all its costs incurred in connection with producing the same, or contract with a third party to produce such videos and/or photographs, provided, however, that any videos and photographs produced by any such third party shall in all ways meet SeaVision's technical standards for use on the System. If Carnival elects to have SeaVision produce any such videos or photographs, SeaVision shall provide Carnival with detailed -28- cost estimates prior to the initiation of video and photograph production, and such estimates shall be subject to Carnival's written approval. Such estimates will include the cost of pre-production scripting and preparation and the cost of sending crews aboard Carnival's Ships for taping, photographing and post-production editing. Carnival shall pay these costs directly to SeaVision as a vendor. Notwithstanding the foregoing, the parties have agreed, in respect of the Initial Ship, to [Redacted - confidential treatment requested], which [Redacted - confidential treatment requested] will then be available to both parties for their use. Carnival shall make its library of videos and photographs for shore excursions used in connection with the Initial Ship available to SeaVision for SeaVision's use in connection with the conduct of its business. SeaVision shall make its library of videos and photographs for shore excursions available to Carnival for Carnival's use on the System in connection with the conduct of its business. . Interface with Carnival's Property Management System: Each System will interface with the applicable Ship's property management system to enable appropriate charges to be applied to passenger accounts. Carnival shall undertake at its own cost any programming necessary to allow the applicable Ship's property management system to effectively interface with the System. . Access Control: The System will be designed to limit access to only those persons who are adult passengers or who are minors under adult supervision. Passengers will be able to limit access to various services, such as gaming and adult programming, by enabling lock-out codes and using password procedures, all of which shall be subject to Carnival's approval which shall not unreasonably be withheld, delayed or conditioned. . Report Generation: The System will generate detailed activity reports, which will be made available to Carnival for the purposes of revenue payments to SeaVision. The format of the reports shall be mutually agreed upon by Carnival and SeaVision. SeaVision shall also provide, at Carnival's request, reports pertaining to passenger usage of the System. Services to be Provided at No Charge, but Contingent Upon Carnival Providing the - -------------------------------------------------------------------------------- Appropriate Content - ------------------- . Ports of Call and Shopping Information: Passengers will be able to use the System to obtain information regarding on-board shopping, ports of call and shopping at ports of call. . Cruise Information: Passengers will be able to use the System to view cruise information about Carnival cruises and to request additional on-board cruise information. -29- . Gaming Tutorial: Passengers will be able to use the System to view in-cabin gaming and casino video tutorials. . Ship Position and Weather Information: Passengers will be able to use the System to obtain information regarding the Ship's position throughout the cruise and to obtain weather information. . Safety Instructions: Passengers will be able to view general safety instruction videos on the System. . Emergency Broadcast Messages: Designated members of the Ship's crew will be able to use the System to deliver emergency broadcast messages to all televisions connected to the System. . Passenger Evaluations: Designated members of the Ship's crew will be able to use the System to collect information from passengers regarding passenger evaluation of various activities and services. . CARNIVAL CAPERS: Passengers will be able to view CARNIVAL CAPERS from any television connected to the System, with dynamic updating of CARNIVAL CAPERS by the Ship's staff at any time. Revenue-Generating and Pay-Per-View Entertainment - ------------------------------------------------- NOTE: Carnival will be entitled to a portion of the Adjusted Gross Revenues generated by the following services, pursuant to and in accordance with the terms of Section 3 of the Agreement. . Video-on-Demand: Passengers will be able to purchase movies and other entertainment options such as taped concerts, on demand, using the System and their television remote-control. SeaVision shall determine the fee [Redacted - confidential treatment requested] that will be levied for each such order and charged to such passengers' respective cabin accounts. Subject to Carnival's approval, adult programming may be offered. . Gaming Options: Passengers will be able to play video slots, poker and blackjack on the System, when permissible under applicable laws. The payoff percentages shall be the same as those paid by Carnival in its on-board casinos. Any additional games that SeaVision may desire to provide on the System, or changes to the rules of existing games, shall be subject to the parties' mutual agreement. Any changes to the rules of existing games must be approved by Carnival. SeaVision will determine the value of each -30- individual credit that passengers may purchase and charge to their cabin accounts. Credits may be redeemed at a location designated by Carnival. . Shopping: SeaVision will offer passengers shopping videos and interactive video shopping on and through the System. Carnival will retain the [Redacted - confidential treatment requested] right, [Redacted - confidential treatment requested] to approve the items offered for sale and the vendors providing those items. Carnival will not incur any liability to SeaVision due to Carnival's failure to approve any item proposed to be offered for sale by SeaVision. In the event Carnival elects to offer its own items for sale on and through the System, Carnival shall pay all related production costs incurred by SeaVision directly to SeaVision as a vendor and SeaVision will be entitled to a share of the Adjusted Net Revenues generated therefrom (net of the costs to Carnival of the goods sold) pursuant to and in accordance with the terms of Section 3 of the Agreement (except that Carnival shall be entitled to retain [Redacted - confidential treatment requested] of such Adjusted Net Revenue). Access to the System by concessionaires on board the applicable Ship, including but not limited to the on-board shops, casino, beauty salon and spa, and photographer, will be by agreement between SeaVision, Carnival and those vendors. Carnival will be entitled to [Redacted - confidential treatment requested] of the Adjusted Net Revenues generated by any fees paid by such purveyors, pursuant to and in accordance with the terms of Section 3 of the Agreement. . Advertising and Promotions: SeaVision shall have the exclusive right to provide access to the System to third parties for the purposes of advertising, promotions and marketing of their companies, products or services. Carnival shall retain the right to approve such third party advertisers as will be given access to the System and the manner in which any such advertising is presented. Carnival shall designate the individual responsible for granting such approvals on its behalf, and such individual shall provide SeaVision with general guidelines for advertising and marketing activities and the procedure SeaVision shall follow in submitting advertising and marketing proposals for Carnival's consideration. Carnival shall notify SeaVision of its approval or denial of an advertising or marketing proposal within 30 days after SeaVision's written submission thereof. In the event Carnival fails to notify SeaVision of its decision within that period, it shall be deemed to have approved that written submission. Carnival will be entitled to a portion of the Adjusted Gross Revenues generated by such advertising and marketing promotions on the System, pursuant to and in accordance with the terms of Section 3 of the Agreement. -31- Miscellaneous Optional Services (To be offered - ---------------------------------------------- only upon the mutual agreement of the parties) - ---------------------------------------------- . Digital Photography: Passengers will be able to view in their cabins personal photographs taken by the on-board photo concessionaire. The System will display the photographs allowing the passengers to purchase a variety of sizes and poses. This service can include, subject to Carnival approval, kiosk-based applications which will provide an entertaining and easy-to-use graphical, touch screen interface to purchase "instant" photographs with a wide variety of backgrounds and in various sizes. Allocation of the digital photography revenues, less cost of materials, will be determined by the mutual agreement of the parties as a condition to this service being provided. . Services Reservations: Passengers will be able to place reservations for on-board personal services and functions. . Electronic Messenger: Electronic messages will be able to be sent to individual passengers or to designated groups of passengers. . Tutorial Video: Passengers will be able to view a System tutorial video. . Cabin Maintenance: The crew of the Ship will be able to centrally log cabin maintenance requirements. . Kiosks: Upon terms and subject to conditions to be agreed upon by the parties. -32- EXHIBIT C SeaVision Production Services Charges ------------------------------------- Field Production Video . Shore Excursions [Redacted - confidential treatment requested] Gaming Demonstrations Health Spa Promotional Piece Shopping Items (shooting in studio) . Passenger Questionnaire Intro by CEO Post Production Video . Editing [Redacted - confidential treatment requested] MPEG Process Tape Stock/Beta SP Post Production Audio . Studio Time [Redacted - confidential treatment requested] . Voice Over Talent for Shopping, Shore Ex. Editing Music Background Copywriting WAV Formatting MPEG Audio Formatting Tape Stock/DAT Screen Production . Static Screen Animation Screen Foreign Language Translation [Redacted - confidential treatment requested] . Language Translations Voice Over Talent Studio Time Screen Translations -33- Such charges may be adjusted from time to time by SeaVision, but, throughout the term of this Agreement, SeaVision shall not [Redacted - confidential treatment requested]. -34- EXHIBIT D Preliminary ITV Deployment Schedule for Carnival Cruise Lines
Task Date Formalize Operating Agreement or Date of Designation 2/15/96 Provide Carnival Cruise Lines (CCL) with phased deployment strategy document. 3 days This document will serve as the primary reference for all technical and operational issues relative to the installation and operation of the ITV system. All SeaVision and CCL staff that are actively participating in the coordination of the ITV system installation will receive a copy of this document. The document will be updated and redistributed on a weekly basis to reflect new discovery and operating decisions that are made through out the initial development period. Facility assessment document delivered to CCL. This document will aid CCL in 4 days preparing for a ship board survey of the ships RF distribution system, broadcast control center, property management system, and other related facilities. The document will request items like copies of the ships RF distribution design drawings, floor plans for the broadcast center, and information on the make and model of the cabin televisions. Initial strategy meeting takes place at CCL's Miami office to discuss each ITV week 1 application module in detail. This meeting will involve department heads from the following areas: Food and Beverage, Casino, Shore Excursion, Hotel operations, MIS, Reservations, and Entertainment. The basic functionality of each ITV module will be discussed and adjusted based upon the capabilities of the respective ship board system or service that it will be associated with. Installation timetables are reviewed and finalized. A review of all content to be provided by CCL is completed, turn around times are agreed upon. Content to be provided by CCL includes items like shore excursion videos, wine labels and room service menus. CCL will also be requested to provide certain props to aid in the screen production. For example, CCL casino chips for the gaming module. Two person team arrives on the ship to perform a thorough survey of the ships week 2 facilities. While on board, the survey team will complete a test of the integrity of the existing RF plant and complete an engineering design for upgrade of the plant to a bandwidth of 750 MHz with and two way data path. Select a primary and secondary location for placement of the ITV server and subsystem racks. Meet with Chief Engineer and agree on a final location and specify power requirements for operation of the system. Qualify locations for remote peripheral devices. For example, pantry printers. Network engineer meets with CCL PMS manager to specify interface protocol and week 2 development schedule. SeaVision marketing and operations staff to meet with ships Hotel Director while week 2 ship is in port. Hotel Director is debriefed as to how the system will integrate with the day to day operations of the vessel. Subsequent orientation meetings are scheduled with the Chief Steward, Food and Beverage Manager, Shore Excursion Manager, and Cruise Director. Progress meeting in Ohio with CCL management team to review and sign off initial week 3 screen designs, story boards, and voice prompts. Engineering and design of the cabin TV interface. week 4 Progress meeting in Ohio with CCL management team to complete final review of week 5 all content production. Begin testing of PMS interface via ISDN Internet connection between CCL Miami week 6 office and SeaVision Oakland office. Six person installation team arrives on board the ship. Four installer week 6 technicians begin TV modification and cabin terminal control module installation at the rate twelve per day per person. Two RF engineers begin upgrade and of distribution system. CCL ship board personnel complete necessary AC power circuits for ITV racks. week 6 Two hardware engineers arrive on board to begin rack placement, wiring and week 8 testing. All SeaVision and CCL provided content production is complete. week 8 Six person installation team completes all cabin TV's and terminal week 9 installations. Final testing of RF system is complete. Addendum's are added to the ship board RF engineering drawings to reflect the work performed by SeaVision. Team departs ship. Two hardware engineers complete component installation and system power up. week 10 Depart ship. Two systems engineers arrive on board to begin software uploads and PMS week 10 interface testing. SeaVision System Manager arrives on board for orientation of ships systems and week 10 to begin configuration of the ITV system. Dry run testing of system begins in designated passenger cabins occupied by week 11 SeaVision or Carnival personnel. Activation of SeaVision Interactive Services for Carnival Cruise Line week 13 passengers. Systems engineers depart ship. System manager assumes day to day operation of the ITV system.
D-2 EXHIBIT E Technical Performance Standards of the System --------------------------------------------- [Redacted - confidential treatment requested] -36- EXHIBIT F 1. Carnival Marks --------------
Mark Class Protection Status of U.S. Rights ---- ---------------------------------------------- Camp Carnival + design 39, 41, 42 registered under #1853842 on 9/13/94 Carnival 39, 41, 42 registered under #1495405 on 7/5/88 Carnival 41 (at sea) registered under #1489673 on 5/24/88 Carnival 41 (land-based) registered under #1591384 on 4/10/90 Carnival 39 (airline) registered under #1592400 on 4/17/90 Carnival 39, 42 (travel agency svcs.) filed 8/30/95-Ser. #75/724, 010 Carnival Cruise Lines 39, 25 registered under #1489408 on 5/24/88 Carnival Destiny 39, 41, 42 filed 4/5/95-Ser. #74/656,424 Carnival's Cruise Vacation Protection Plan common law rights Carnival's Got the Fun! 39, 41, 42 registered under #1487129 on 5/3/88 Celebration 39, 41, 42 registered under #1614283 on 9/18/90 Reverse-C logo 39, 41, 42 registered under #1434247 on 3/24/87 Reverse-C logo 39 registered under #1594583 on 5/1/90 Ecstasy 39, 41, 42 registed under #1746109 on 1/12/93 Fantasy use by agreement with Chandris Fantasy Line Fascination 39, 41, 42 filed 1/31/94-Ser. #74/485,088 Fly Aweigh 39 registered under #1089880 on 4/18/78 The Fun Ships 39 registered under #1112889 on 2/6/79 The Fun Ships 41, 42 registered under #1451397 on 8/14/87 The Fun Ships 39 (airline) registered under #1593456 on 4/24/90 Holiday 39, 41 registered under #1655789 on 9/3/91 Imagination 39, 41, 42 filed 1/31/94-Ser. #74/485,086 Inspiration 39, 41, 42 filed 1/31/94-Ser. #74/503,432 Jubilee 39, 41, 42 registered under #1656449 on 9/10/91 *Most Popular Cruise Line in the World 39 registered under #1630363 on 1/1/91 Sensation 39, 41, 42 registered under #1,937,420 on 11/21/95 Ship funnel (wing design) 39, 41 registered under #1,814,770 on 11/30/93 Tropicale 39, 41, 42 registered under #1666109 on 11/26/91 Vacation People (The) 39, 41, 42 registered under #1748912 on 1/26/93 We've Got the Fun! 39 registered under #1368211 on 10/29/85 We've Got the Fun! 41, 42 registered under #1443595 on 6/16/87 What's Your Idea of Fun? 39, 41, 42 filed 11/3/95-Ser. #75/014,930 **Your Kind of Fun 39, 41, 42 registered under #1918884 on 10/10/95
* Official translation in the following languages: French: La Ligne de Croisiere la Plus Populaire du Monde! German: Die Beliebteste Kreuzfahrtlinie der Welt! Dutch: De Meest Populaire Cruisemaatschappij ter Wereld Hebrew: [written in Hebrew] Spanish: La Linea de Cruceros Mas Conocida Del Mundo Italian: Con La Compagnia di Navegazione Piu Famosa Nel Mondo Portugese: A Companhia de Cruzeiros Mais Popular Do Mundo ** Official Translation in the following languages: German: Das richtige Vergnugen fur Sie Portugese: Onde voce se diverte como gosta Dutch: Het plezier waar u naar zoekt Italian: Scegli Il Tuo Divertimento! French: A chacun son bonheur Hebrew: (written in modern Hebrew) Spanish: Tu Estilo de Diversion 2. Marks and slogans developed or to be developed by Carnival or SeaVision for use on the System on board Carnival Vessels. 3. Nautica Spa & Seahorse Design is the property of Nautica Apparel, Inc. and may only be used on the System on board Carnival Vessels in order to identify the services offered by the Nautica Spa and bathrobe sold therein. 4. Any and all published or nonpublished material, marks, slogans, designs and photography in which Carnival has acquired intellectual property rights, including without limitation the names of casino games developed by or for the benefit of Carnival, the names of dining areas, lounges, bars, grills, casinos, discos, libraries and other locations on board Carnival Vessels. EX-10.14 4 AGREEMENT WITH NORWEGIAN CRUISE LINE LTD. Exhibit 10.14 The marked portions of this Exhibit have been omitted and filed separately with the Commission pursuant to a request for confidential treatment. AGREEMENT This Agreement, dated as of August 12, 1996, is made by and between SEAVISION, INC., a Delaware corporation (hereinafter referred to as "SeaVision"), and NORWEGIAN CRUISE LINE LIMITED, a Bermuda corporation (hereinafter referred to as "NCL"). WHEREAS, NCL is in the business of offering cruise vacations to its passengers; and WHEREAS, NCL desires that its passengers have access to interactive television and video entertainment services on board its vessels; and WHEREAS, NCL wishes to earn incremental revenue from such interactive television and video entertainment services; and WHEREAS, SeaVision desires to provide to NCL, and NCL desires to obtain from SeaVision, the aforementioned interactive television and video entertainment services for use aboard the ship M/S Dreamward (the "Initial Ship") and such other cruise vessels owned or operated by NCL as, from time to time, may be designated by NCL (all such cruise vessels, collectively, the "Ships" and, individually, a "Ship"); and WHEREAS, NCL has requested that SeaVision provide such interactive television services onboard the Ship S/S Norway; and WHEREAS, SeaVision heretofore has installed on the Initial Ship the hardware and software described or listed on Exhibit A attached hereto (collectively, the "Installed Hardware and Software"); NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 1. Responsibilities. ---------------- (a) Subject to the terms and conditions hereof, SeaVision hereby agrees to: (i) Provide, for each Ship designated by NCL (including without limitation the Initial Ship) at no charge to NCL, an interactive television system (the "System") consisting of the hardware and software described or listed on Exhibit A attached hereto (collectively, the "System Hardware and Software") and, in connection therewith, provide the services (the "Services") set forth on Exhibit B attached hereto. In addition thereto, SeaVision shall provide for, and install on, the S/S Norway [Redacted -confidential treatment requested]. Until such time as SeaVision shall have received the aggregate amount of [Redacted - confidential treatment requested]. Upon SeaVision's receipt of such aggregate amount thereunder, [Redacted - confidential treatment requested]. NCL hereby acknowledges and agrees that the System Hardware and certain of the interactive modules of the Software are installed on the Initial Ship and, as of the date of this Agreement, the Hardware and such installed modules of the Software are performing satisfactorily. Notwithstanding anything contained herein or in any other provision of this Agreement that might be construed to the contrary [Redacted -confidential treatment requested], SeaVision shall at all times retain title to all components of the System, including all System Hardware and Software or other hardware or software hereafter installed by Sea Vision on any Ship hereunder. (ii) Provide all personnel reasonably necessary and appropriate to operate the System and provide the Services. One (1) SeaVision technician (the "Manager") will remain on-board each Ship on which the System is then installed and operating to operate the System on an on-going basis and to fulfill the responsibilities of the on-board television coordinator (as described on Exhibit C attached hereto) for so long as this Agreement shall be in effect with respect to that Ship. SeaVision hereby acknowledges that the Manager shall at all times be an employee of SeaVision. NCL hereby agrees to serve as SeaVision's paying agent for payment, at the direction of SeaVision, of all salary, payroll taxes and fringe benefits costs in connection with the Manager; provided that SeaVision promptly reimburses NCL for all such costs incurred by NCL. SeaVision understands that, while on-board any Ship, its personnel will be subject to the authority of the Master of that Ship and the officer(s) designated to oversee the operation of the System and the Services. SeaVision agrees that its employees will be considered seamen and will attend and participate in boat drills held onboard each of the respective Ships as requested by the Ship's master and officers. All such employees shall attend Coast Guard inspections and, if required by NCL, will earn life boat efficiency certificates. SeaVision shall employ onboard the Ships only those persons medically fit for service onboard the vessels in accordance with standards established by NCL and who have agreed to abide by the orders of the masters and officers for service onboard the Ships. It shall be the sole -2- responsibility of SeaVision to absorb and pay the costs of pre- employment physical examinations and to employ persons who have valid passports, visas and all other permits required by any governmental authority in order that they might enter and leave the ports of call of the Ship on which they are employed. Annual physicals shall be required of SeaVision's shipboard employees. (iii) Upgrade the hardware and/or software used in the System, at no cost to NCL, at such times and in such manner as is reasonably necessary or appropriate, to maintain the System on the Ship, subject always, in the case of hardware upgrades only, to the consent of NCL, which consent shall not unreasonably be withheld, and to the constraints placed thereon by the space available on- board any Ship for the installation of such hardware. (b) Subject to the terms and conditions hereof, NCL hereby agrees to: (i) Make available to SeaVision in respect of any Ship upon which the System is then installed or is then to be installed (a) that Ship to the extent necessary for SeaVision's operation and maintenance of the System, including but not limited to granting SeaVision personnel unlimited access to the television studio and video distribution system on board that Ship, (b) such personnel as are reasonably necessary or appropriate to support SeaVision's successful operation and maintenance of the System, including but not limited to appropriate on-board support for and oversight of the operation and maintenance of the System by a designated officer on that Ship, provided, however, that (i) SeaVision shall at all times be primarily responsible for the operation and maintenance of the System, and (ii) NCL shall not be obligated hereunder to make available NCL's personnel if and to the extent that the result thereof would be the interference with that personnel's ability to perform his or her other employment duties owing to NCL, (c) all necessary systems integration support to allow the System to communicate with NCL's on-board systems, and (d) appropriate accommodations on-board that Ship for SeaVision personnel who are engaged in operating or maintaining the System on the Ship, which accommodations shall be comparable to those accommodations provided by NCL to [Redacted - confidential treatment requested]. It is understood that SeaVision personnel occupying such accommodations will, at all times while on-board such Ship, be subject to NCL's policies regarding on-board contractors, including those concerning dress, decorum and personal behavior. -3- (ii) Furnish accommodations on-board each Ship upon which the System is then installed and otherwise respond favorably to reasonable requests by SeaVision's management for accommodations on-board such Ship, on mutually-agreeable dates and subject to availability, to allow SeaVision senior personnel to monitor the on-going performance of the System and SeaVision's personnel and for the purpose of determining whether enhancements and improvements to the System should be recommended. Requests for such accommodations shall not exceed one (1) cabin/voyage per month per Ship. NCL shall also provide the Manager with all other perquisites that it provides to [Redacted -confidential treatment requested]. (iii) Provide marketing support for the System on-board each Ship on which the System is then installed, which support shall be consistent with the type and level of such support being provided by NCL as of the date hereof on-board the Initial Ship. In addition thereto, the parties shall engage in such other activities of a supporting nature as are acceptable to both parties to this Agreement, and upon terms acceptable to both parties to this Agreement. (iv) Work with SeaVision's marketing personnel to develop appropriate and effective means for testing and gauging passenger reaction to the System on a regular basis. Such means shall include but not be limited to on-board questionnaires, on-board focus groups, one-on-one passenger interviews and post-cruise questionnaires. SeaVision shall retain the right to designate the individuals who will conduct these activities, subject to the approval of such individuals by NCL. If SeaVision marketing personnel are not available (or cannot reasonably be accommodated) on a Ship, the Manager on that Ship may assume these responsibilities. (v) Provide access to each Ship when such Ship is in port, for SeaVision personnel to demonstrate the System to potential advertisers, marketers and clients. In connection with making such demonstrations, SeaVision shall conform to NCL's procedures for approving on-board visitors, including but not limited to making advance requests for boarding passes. (vi) Use commercially reasonable efforts to cause its on-board concessionaires to work with SeaVision to develop mutually beneficial applications for the System. (vii) Provide the Manager with the following data, if available, in electronic form (i.e., diskettes, tapes or other similar means) with respect to each -4- passenger on-board any Ship on which the System is then installed: name, home address and telephone number, age, cabin assignment, dining assignment and on-board account number. (viii) Collect all monies paid or payable by passengers in respect of Services provided on or through the System and charged to the respective on-board account of such passengers. (ix) Provide without change limited and reasonable on-board medical care as needed for minor illnesses and injuries to the extent such treatment can be provided on-board the Ship. NCL shall not be responsible hereunder for on-shore continuing or follow-up treatment. 2. Term/Extension to Other Ships. ----------------------------- (a) Unless sooner terminated in accordance with the terms of this Agreement, the term of this Agreement (the "Term") shall commence on the date first written above and shall expire on [Redacted - confidential treatment requested] (the "Expiration Date"). (b) NCL hereby grants to SeaVision the exclusive right, for the Term of this Agreement, to install, operate and maintain all in-cabin interactive television systems and any kiosk-based interactive television systems connected to such in-cabin systems on the M/S Dreamward and the S/S Norway. (c) (i) If, during the term of this Agreement, NCL wishes to install or have installed interactive television and video entertainment services on-board any ship owned or operated by NCL other than the M/S Dreamward and the S/S Norway, NCL shall, in each such instance, [Redacted - confidential treatment requested]. (ii) If, in respect of any ship, [Redacted - confidential treatment requested] to provide onboard that ship interactive television and video entertainment services during the term of this Agreement, NCL shall [Redacted - confidential treatment requested]. SeaVision shall thereafter have [Redacted - confidential treatment requested]. If SeaVision [Redacted - confidential treatment requested], NCL shall thereafter be precluded from accepting such third party offer. If SeaVision [Redacted - confidential treatment requested] as provided herein, NCL may, [Redacted - confidential treatment requested] (iii) NCL and SeaVision each understands and agrees that the other party is not required hereunder [Redacted - confidential treatment requested], including without limitation [Redacted - confidential treatment -5- requested]. Subject to the foregoing provisions of this Section 2(c), in the event the parties agree that SeaVision will install, operate and maintain the System on any additional Ship(s), the references herein made to a or any Ship and/or the System shall be deemed to include such other Ship(s) and the System(s) installed thereon, which such modifications as are reasonably necessary and appropriate to reflect the individualized System(s) installed on each such Ship and are consistent with the agreement of the parties in respect thereto. 3. Revenue-Sharing and Payment Terms. --------------------------------- (a) In consideration of SeaVision's agreement to provide televisions on the S/S Norway, SeaVision shall be entitled to receive [Redacted - confidential treatment requested] of the Adjusted Gross Revenues (as defined below) generated by all of the Systems installed onboard the Ships. If SeaVision has not received under this subsection 3(a) the aggregate amount of [Redacted -confidential treatment requested], NCL shall pay to SeaVision [Redacted -confidential treatment requested], whereupon SeaVision shall not be entitled to receive any further funds under this subsection 3(a). (b) If the aggregate of all of the Adjusted Gross Revenues generated by all of the Systems installed on-board the Ships, from the commencement of this Agreement, is less than the amount [Redacted - confidential treatment requested], then NCL shall be entitled to retain five percent (5%) of the Adjusted Gross Revenues for the applicable calendar month, as indicated on the applicable report provided to NCL by SeaVision pursuant to the terms of subsection 3(e) below, and shall promptly remit [Redacted - confidential treatment requested] of such Adjusted Gross Revenues to SeaVision in accordance with this Section 3. (For purposes of this subsection 3(b), the relevant Adjusted Gross Revenues are the cumulative Adjusted Gross Revenues from the date of this Agreement to the relevant month-ending date of such calculation; such Adjusted Gross Revenue calculation is not performed on an annual --- basis.) (c) If the aggregate of all of the Adjusted Gross Revenues generated by all the Systems on board the Ships, from the commencement of this Agreement, [Redacted - confidential treatment requested], then, for the twelve month period commencing on the date [Redacted - confidential treatment requested] and for each succeeding twelve month period [Redacted -confidential treatment requested] the Adjusted Gross Revenues generated by all of the Systems installed onboard the Ships shall be allocated between the parties as follows: -6- (i) NCL shall be entitled to retain [Redacted - confidential treatment requested] of, and shall pay over to SeaVision [Redacted -confidential treatment requested] of such Adjusted Gross Revenues; (ii) NCL shall be entitled to retain [Redacted - confidential treatment requested] of, and shall pay over to SeaVision [Redacted -confidential treatment requested], such Adjusted Gross Revenues [Redacted - confidential treatment requested]; and (iii) NCL shall be entitled to retain [Redacted - confidential treatment requested] of, and shall pay over to SeaVision the remaining [Redacted - confidential treatment requested] of, such Adjusted Gross Revenues in excess of [Redacted - confidential treatment requested]. (d) "Adjusted Gross Revenues", for purposes of this Agreement, shall mean the aggregate of all amounts paid to NCL in connection with passengers' use of the Services provided by or on the System and charged to such passengers' respective on-board accounts by NCL, other than amounts paid or payable in respect of [Redacted - confidential treatment requested], less (i)(A) the cost to SeaVision of goods sold in the case of products and services sold on the System, (B) the cost to SeaVision of pay-per-view programming provided on the System, and (C) the commissions paid by SeaVision to third parties for advertising sold on the System, the aggregate amount of which NCL shall pay over to SeaVision, and (ii) credits paid by NCL to passengers in the case of gaming on the System. (e) On or before the twenty-first day of each calendar month during the Term of this Agreement, SeaVision shall provide NCL with a written report detailing the Adjusted Gross Revenues generated by the System on each Ship on which the System is then installed from cruises completed during the prior calendar month. This report shall govern the determination of fees to be retained by NCL and the revenues to be remitted by NCL to SeaVision under the terms of this Agreement. SeaVision shall provide any and all hardware and/or software reasonably necessary or appropriate to interface SeaVision's accounting software with the Ship's property management system in order for SeaVision to obtain accurate accounting information for such reports. (f) Within ten (10) days after NCL's receipt of any monthly report delivered to NCL by SeaVision pursuant to the terms of subsection 3(e) herein, NCL shall remit to SeaVision all Adjusted Gross Revenues generated by the System on the Ship during the calendar month applicable to such report, less its share of such Adjusted Gross Revenues as provided in this Section 3. -7- (g) NCL shall promptly notify SeaVision of any changes, adjustments or chargebacks (relative to the Adjusted Gross Revenues in respect of any calendar month) of which NCL receives notice after it has made a remittance to SeaVision in respect of such calendar month, and together therewith, provide to SeaVision appropriate documentation supporting all such changes, adjustments or chargebacks. In the event properly-supported changes, adjustments or chargebacks result in a reduction of the Adjusted Gross Revenues generated in respect of such calendar month, SeaVision shall, within thirty (30) days after its receipt of the applicable notice and supporting documentation, refund to NCL SeaVision's percentage of the aggregate of such changes, adjustments or chargebacks. 4. Confidentiality. --------------- (a) NCL acknowledges that the System represents and will continue to represent the valuable, confidential and proprietary property of SeaVision. SeaVision is not by this Agreement conveying to NCL any exclusive proprietary or ownership rights in the System, including, but not limited, to any patent, copyright, trademark, service mark, trade secret, trade name or other intellectual property rights, except that NCL will have the limited rights expressly set forth in this Agreement. Accordingly, NCL acknowledges that, except as expressly provided for in this Agreement, NCL possesses no title to or ownership of any System or any portion thereof. NCL will keep the System free and clear of all claims, liens and encumbrances resulting from actions or omissions of NCL. (b) Each party agrees, during the Term of this Agreement and thereafter, to maintain the confidential nature of the terms and conditions of this Agreement and of any proprietary information shared by the other with it. In the case of SeaVision's proprietary information, such proprietary information shall include, but is not limited to (i) any knowledge gained by NCL of SeaVision's proprietary application software or the configuration of the System; (ii) SeaVision's marketing and sales materials; (iii) the format of any and all SeaVision reports, including those for data management, revenue remittance and marketing surveys, to the extent protected by copyright law; and (iv) SeaVision's marketing and advertising client list. In the case of NCL's proprietary information, such proprietary information shall include, but is not limited to, the data provided by NCL to SeaVision pursuant to the terms of subsection 1(b)(vii) hereof, except for any such data in respect of; any passenger who purchases merchandise from SeaVision through the System, which data shall not be NCL's proprietary information. Notwithstanding anything contained in this Agreement to the contrary, the terms of this Section 4(b) shall survive the expiration or termination of this Agreement. -8- (c) Each party acknowledges that its violation of its confidentiality or non-disclosure obligations under this Agreement may cause irreparable damage to the other that cannot be fully remedied by money damages. Accordingly, in the event of any such violation or threatened violation, the injured party will be entitled, in addition to pursuing any other remedy available to it under this Agreement or at law, to obtain injunctive or other equitable relief from any court of competent jurisdiction as may be necessary or appropriate to prevent any further violations thereof. (d) Each party agrees to notify the other immediately upon the notifying party's becoming aware of or reasonably suspecting the possession, use or knowledge of all or part of any of the other party's proprietary information by any person or entity not authorized by this Agreement to have such possession, use or knowledge. The notifying party will promptly furnish the other party with details of such possession, use or knowledge, will assist in preventing a recurrence thereof and will cooperate with the other party in protecting the other party's rights in the other party's proprietary information. A party's compliance with the terms of this Section 4 will not be construed as any waiver of the other party's right to recover damages or obtain other relief against the notifying party for the notifying party's breach of its confidentiality or non-disclosure obligations under this Agreement or the negligent or intentional harm to the other party's proprietary rights. 5. Termination. ----------- (a) NCL shall have the right to terminate this Agreement prior to the Expiration Date in the event the System fails to achieve the technical performance standards set forth in Exhibit D attached hereto. NCL may not exercise this right (i) if such technical failure occurs as a result of NCL's failure to perform any or all of its obligations under the terms of this Agreement; and (ii) without written notice to SeaVision of its intention to do so and prior to a period of 90 days following such notice in which SeaVision may effect a cure of such failure. In respect of any notice hereunder by NCL of its intention to terminate this Agreement as a result of any System deficiency which served as the basis for any prior such termination notice, NCL shall be obligated, in the case of the second such notice, to extend to SeaVision a thirty-day cure period rather than a ninety-day cure period and NCL shall not be obligated, in the case of the third or any subsequent notice, to extend to SeaVision any cure period whatsoever. SeaVision shall, within fifteen (15) days following NCL's written notice to SeaVision under such clause (iii), above, provide to NCL SeaVision's written response regarding such failure, which response shall set forth SeaVision's assessment of the cause of such failure and SeaVision's plan to rectify such failure. In any event, SeaVision shall make a good faith effort to rectify such failure as promptly as is reasonable under the circumstances -9- and, where appropriate, will implement temporary "work around" solutions until a permanent solution can be implemented. (b) SeaVision shall have the right to terminate this Agreement in whole or in part prior to the Expiration Date in the event the System fails to achieve the financial performance standards that SeaVision shall determine are necessary to warrant its investment in the System. In the event SeaVision intends to terminate this Agreement pursuant to this subsection 5(b), it shall do so in writing to NCL no less than one hundred twenty (120) days prior to ceasing operations hereunder or thereon, as the case may be. (c) Either party hereto shall have the right to terminate this Agreement immediately upon written notice to the other party upon such party being declared insolvent or bankrupt, or making an assignment for the benefit of creditors, or in the event that a receiver is appointed, or any proceeding for appointment of a receiver or to adjudge such party a bankrupt, or to take advantage of the insolvency laws is demanded by, for, or against such party under any provision under the laws of any state or country. (d) NCL shall have the right to terminate this Agreement prior to the Expiration Date in the event SeaVision defaults in the performance of any covenant, warranty or agreement made herein (except a failure by the System to achieve certain technical performance standards which is governed by subsection 5(a) herein), and such default has not been cured within thirty (30) days after receipt of written notice thereof given by NCL to SeaVision. (e) SeaVision shall have the right to terminate this Agreement prior to the Expiration Date in the event NCL defaults in the performance of any covenant, warranty or agreement made herein and such default has not been cured within thirty (30) days after receipt of written notice thereof given by SeaVision to NCL. (f) Notwithstanding the termination or expiration of this Agreement as provided for in this Section 5 and elsewhere in this Agreement, NCL shall continue to owe, and shall promptly pay to SeaVision in accordance with the terms of Section 3 hereof, all amounts set forth in Section 3 that shall have accrued on and prior to the date of such termination or expiration. (g) As soon as is practicable after the expiration or any termination of all or part of this Agreement or any renewal operating term thereof, SeaVision shall remove the System, including all hardware and software, and all on-board SeaVision personnel from the Ship. The parties hereby agree and acknowledge that in accordance with Section 1 hereof, SeaVision will retain title to any and all hardware and software installed on board the Ship by -10- SeaVision (x) at all times while this Agreement or any renewal operating term thereof is in effect as well as (y) in the event SeaVision chooses not to continue operating the System installed thereon. Notwithstanding the foregoing, if SeaVision elects to terminate this Agreement for any of the reasons set forth above, NCL shall have the right to (i) purchase all SeaVision hardware (but not software) installed by SeaVision on any Ship, including but not limited to [Redacted - confidential treatment requested], at an aggregate purchase price equal to [Redacted - confidential treatment requested] and (ii) obtain a nontransferable license to use (but only on the applicable Ship) the SeaVision software installed by SeaVision on that Ship [Redacted -confidential treatment requested]. 6. Right to Inspect Books & Records. SeaVision and NCL shall keep full -------------------------------- and accurate accounts, records, books, journals, ledgers and data (collectively, "Records") with respect to the business done by each party respectively under this Agreement, which Records shall at all times show truthfully, accurately and fully the compliance by each party with its respective obligations under this Agreement. Each party shall have the right, through its designated representatives, at all reasonable times, upon reasonable advance notice, to inspect the Records of the other as necessary to verify the sales, revenues generated and fees collected pursuant to this Agreement. The parties shall retain all Records at all times during the Term of this Agreement and any and all extensions or renewals thereof, and for at least three (3) years thereafter, and shall make the Records available to the other party during regular business hours, wherever the Records are maintained, within ten (10) days after receipt of demand for inspection from such other party. Both parties shall maintain the confidential nature of any Records so inspected pursuant to and in accordance with the provisions of Section 4 hereof. 7. Insurance/Waiver of Subrogation. ------------------------------- (a) So long as their respective insurers so permit, neither party hereto shall be liable to the other, or to the insurer of the other, claiming by way of subrogation through or under such other party with respect to any loss or damage, in whole or in part, to the System on any Ship, to the extent that such other party shall be reimbursed out of that party's insurance coverage carried for such other party's protection with respect to such loss or damage. If so permitted, the parties shall each obtain any special endorsements required by their respective insurance carriers to evidence compliance with the waiver and release set forth herein and shall provide a copy thereof to the other party. (b) SeaVision hereby warrants, represents and covenants that, consistently during the Term and at its sole expense, each Manager and each member of SeaVision's System installation crews shall be included on SeaVision's protection and indemnity cover and shall be covered by general medical -11- insurance maintained by SeaVision, in each case for such periods of time as the Manager or such crew member is posted to a Ship. 8. Interruption in Performance. Neither NCL nor SeaVision shall be --------------------------- liable to the other for any loss, damage or loss of profits arising out of any interruption or cessation of the Services to be provided hereunder when such interruption or cessation is caused by any circumstance beyond the reasonable control of such party. 9. Indemnification. --------------- (a) SeaVision shall indemnify, defend and hold harmless NCL and its successors and assigns from and against any and all liabilities, claims, suits, damages, judgments, awards, penalties, losses and other liabilities (including all related reasonable attorneys' fees, costs and expenses in connection therewith) (collectively referred to hereinafter as "Losses") suffered or incurred by NCL by reason of, arising out of or in connection with (i) any negligent, willful or intentional act or omission of SeaVision (or an employee, agent or representative of SeaVision) committed or omitted, as the case may be, in the course of SeaVision's performance of the terms of this Agreement or (ii) SeaVision's failure to fully perform the terms of this Agreement. (b) NCL shall indemnify, defend and hold harmless SeaVision and its successors and assigns from and against any and all Losses suffered or incurred by SeaVision by reason of, arising out of or in connection with (i) any negligent, willful or intentional act or omission of NCL (or an employee, agent or representative of NCL) committed or omitted, as the case may be, in the course of NCL's performance of the terms of this Agreement or (ii) NCL's failure to fully perform the terms of this Agreement. 10. Further Assurances of SeaVision's Title. --------------------------------------- (a) NCL hereby agrees to execute and deliver to SeaVision, upon the request of SeaVision from time to time, such UCC-1 financing statements and other documents as SeaVision shall reasonably require for the purpose of evidencing to NCL and any third party SeaVision's continued ownership of all components (hardware and software) of the System (such financing statements and other documents to describe all such components and to be in the form required by applicable law). (b) SeaVision may affix permanent (to the degree reasonably possible), legible and visible labels on each component of the System (hardware only), to the extent that doing so is reasonably possible or practicable. Each such label may clearly indicate that SeaVision holds title to the component to which that label is affixed. -12- 11. Limitation of Liability. THE WARRANTIES AND REMEDIES EXPRESSLY SET ----------------------- FORTH IN THIS AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES AND REMEDIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OR ANY IMPLIED WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE. EXCEPT AS EXPRESSLY PROVIDED HEREIN OR ELSEWHERE IN THIS AGREEMENT, IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF NCL'S USE OF OR INABILITY TO USE THE SYSTEM OR ANY PORTION THEREOF OR FROM ANY DELAY IN THE SYSTEM ACHIEVING THE TECHNICAL PERFORMANCE STANDARDS OR FROM ANY DELAY IN THE SYSTEM MEETING, OR ANY INABILITY OF THE SYSTEM TO MEET, EITHER PARTY'S EXPECTATIONS WITH RESPECT TO OPERATIONS OR PERFORMANCE, EVEN IF SUCH PARTY IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN ADDITION THERETO, SEAVISIONS' LIABILITY FOR DIRECT DAMAGES OF NCL ARISING OUT OF ANY OF THE FOREGOING SHALL IN NO EVENT EXCEED THE AMOUNT OF [REDACTED - CONFIDENTIAL TREATMENT REQUESTED]; PROVIDED, HOWEVER, THAT THE FOREGOING LIMITATION SHALL NOT BE APPLICABLE TO DAMAGES RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SEAVISION OR ITS EMPLOYEES. IN PARTICULAR, SEAVISION IS NOT RESPONSIBLE FOR ANY COSTS INCLUDING, BUT NOT LIMITED TO, THOSE INCURRED AS A RESULT OF LOST PROFITS OR REVENUE, LOSS OF USE OF THE SYSTEM, LOSS OF DATA, THE COST OF RECOVERING ANY DATA, THE COST OF SUBSTITUTE SOFTWARE, OR CLAIMS BY THIRD PARTIES. 12. Sale or Disposal of a Ship. In the event that NCL elects to sell or -------------------------- otherwise dispose of any Ship upon which the System is then installed, NCL promptly shall notify SeaVision in writing of its decision. Upon the sale of any such Ship, the new owner shall have the option of assuming this Agreement with respect to that Ship. If the new owner of such Ship elects not to assume this Agreement in respect of that Ship or in the event NCL is disposing of such Ship other than through a sale or transfer (i.e., decommissioning), SeaVision promptly shall [Redacted - confidential treatment requested], and NCL shall [Redacted - confidential treatment requested] in the case of the S/S Norway), plus the aggregate of [Redacted - confidential treatment requested] by SeaVision [Redacted -confidential treatment requested], less the aggregate of [Redacted - confidential treatment requested]. For purposes of determining [Redacted - confidential treatment requested], the initial value of the System shall be [Redacted - confidential treatment requested] in the case of the S/S Norway), which value shall [Redacted - confidential treatment requested], and to which shall be added [Redacted - confidential treatment requested], which new additional amounts also [Redacted - confidential treatment requested]. -13- 13. Public Announcements. The parties shall consult with each other and -------------------- issue a public statement with respect to this Agreement as soon as is practical after the date hereof. During the term of this Agreement, NCL shall include a reference to SeaVision in any and all public announcements or marketing materials referring to interactive television services on-board the Ships. 14. Right to Make Agreement. Each of the parties hereto represents and ----------------------- warrants to the other that it has all necessary and appropriate power and authority to execute, deliver and carry out the terms and provisions hereof. 15. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall constitute an original and all of which together shall constitute but one and the same original document. 16. Assignment. Either party hereto may assign this Agreement and its ---------- respective rights, interests and obligations hereunder to any third party without the consent of the other party hereto; provided, however, that no such assignment by a party shall relieve that party of any of its liabilities or obligations hereunder. It is expressly understood and agreed that this Agreement and all of SeaVision's interests and rights herein and hereunder may be assigned, pledged, mortgaged and/or hypothecated by SeaVision at its exclusive discretion to any third party purchasing all or substantially all of SeaVision's assets, provided that such assignee agrees in writing to assume all of SeaVision's obligations under this Agreement. 17. Successors. This Agreement shall inure to the benefit of, and be ---------- binding upon, the respective successors and assigns of the parties hereto. 18. Governing Law. This Agreement shall be governed by and construed in ------------- accordance with the laws of the State of Florida, without regard to its principles of conflicts of laws. 19. Severability. If any Section or provision of this Agreement, or any ------------ portion of any Section or provision thereof, shall for any reason be held to be void, illegal or otherwise unenforceable, all other Sections and portions of this Agreement shall nevertheless remain in full force and effect as if such void, illegal or unenforceable portion had never been included herein. 20. Notices. All notices and other communications required or otherwise ------- provided for in this Agreement shall be in writing and sent by registered or certified mail to: If to SeaVision: SeaVision, Inc. 200 Greentree Commons 381 Mansfield Avenue Pittsburgh, PA 15220 Attn: Brian K. Blair -14- If to NCL: Norwegian Cruise Line Limited 2 Alhambra Plaza Coral Gables, Florida 33134 Attn: Robert Walters or to such other place as SeaVision or NCL, as the case may be, may from time to time designate in accordance herewith. 21. Entire Agreement; Modification. This Agreement, including the ------------------------------ Exhibits attached hereto, contains the entire agreement of the parties on the subject matter hereof, and supersedes any and all prior agreements, if any, with respect to such subject matter. This Agreement may not be changed, modified or supplemented except by the written agreement of the parties. IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date first above written. ATTEST: SEAVISION, INC. - ----------------------------------- By: ----------------------------------- Its: Its: ------------------------------- ----------------------------------- ATTEST/WITNESS: NORWEGIAN CRUISE LINE LIMITED By: - ----------------------------------- ------------------------------------ Its: Its: ------------------------------- ----------------------------------- [Signature page to Agreement dated as of August 12, 1996 by and between SeaVision, Inc. and Norwegian Cruise Line Limited] -15- EXHIBIT A Primary Hardware and Software Components of the System to be provided by SeaVision [Redacted - confidential treatment requested] EXHIBIT B I. Entertainment and Interactive Services to be Provided by SeaVision ------------------------------------------------------------------ "Basic" SeaVision Package: Services Provided at No Charge - --------------------------------------------------------- . In-Cabin Room Service Ordering: Passengers will be able to order NCL's standard room service menu, including beverages charged to their cabin account, through the System. Orders will be printed out in appropriate pantries and/or galleys for delivery by NCL personnel. SeaVision shall provide, as part of the System, printers and/or monitors to be used in such pantries and/or galleys for such purpose. . Shore Excursion Ordering: Passengers will be able to watch videos of shore excursions and purchase tickets for shore excursions on and through the System by using their television remote-control. Orders will be printed out in the Shore Excursion Office of the Ship, with tickets in respect thereof to be delivered by NCL personnel. The System will provide appropriate inventory control. . Wine Ordering: Passengers will be able to view a wine menu on the System and order their selection with their television remote- controls. Orders will be printed out in the Wine Steward's office or wine cellar, for delivery by NCL personnel at the designated meal. Cabin accounts will be charged accordingly. NCL shall be responsible for providing all ticket stock, videos and photographs for shore excursions and wine ordering. NCL may choose, at its option, to produce its own videos and photographs, retain SeaVision for this purpose and reimburse SeaVision for all its costs incurred in connection with producing the same, or contract with a third party to produce such videos and/or photographs, provided, however, that any videos and photographs produced by any such third party shall in all ways meet SeaVision's technical standards for use on the System. If NCL elects to have SeaVision produce any such videos or photographs, SeaVision shall provide NCL with detailed cost estimates prior to the initiation of video and photograph production. Such estimates will include the cost of pre-production scripting and preparation and the cost of sending crews aboard NCL's Ships for taping, photographing and post-production editing. NCL shall pay these costs directly to SeaVision as a vendor. Each party shall make its library of videos and photographs for shore excursions available to the other for the other's use in connection with the conduct of its business. . Interface with NCL's Property Management System: The System will interface with the Ship's property management system to enable appropriate charges to be applied to passenger accounts. . Access Control: The System will be designed to limit access to only those persons who are adult passengers or who are minors under adult supervision. Passengers will be able to limit access to various services, such as gaming and adult programming, by enabling lock-out codes and using password procedures. . Report Generation: The System will generate detailed activity reports, which will be made available to NCL for the purposes of revenue payments to SeaVision. SeaVision shall also provide, at NCL's request, reports pertaining to passenger usage of the System. . Passenger Folio Review-On-board Account: Each passenger will be able to use the System to review a summary of his or her account. SeaVision shall provide the interfaces to NCL's on-board systems necessary to provide such review; provided that NCL shall reasonably cooperate with the development of such interfaces. . Transaction Fee: In consideration of SeaVision's provisions of certain services on the System at no charge, NCL agrees to consider the implementation of a transaction fee of not more than $1.00 per transaction initially for passengers utilizing the System for shore excursions, room service, wine ordering and other non-revenue generating passenger services. Any such transaction fees will be included in the Adjusted Gross Revenue generated by the System. Revenue-Generating and Pay-Per-View Entertainment - ------------------------------------------------- NOTE: NCL will be entitled to a portion of the Adjusted Gross Revenues generated by the following services, pursuant to and in accordance with the terms of Section 3 of the Agreement. . Video-on-Demand: Passengers will be able to purchase movies and other entertainment options such as taped concerts, on demand, using the System and their television remote-control. SeaVision shall determine the fee that will be levied for each such order and charged to such passengers' respective cabin accounts. Subject to NCL's approval, adult programming may be offered. . Gaming Options: Passengers will be able to play video slots, poker and blackjack on the System. Any additional games that SeaVision may desire to provide on the System shall be subject to the parties' mutual agreement. SeaVision will determine the value of each individual credit that passengers may purchase and charge to their cabin accounts. Credits may be redeemed at a location designated by NCL. . Shopping: SeaVision will offer passengers shopping videos and interactive video shopping on and through the System. NCL will retain the right to approve the items offered for sale and the vendors providing those items. In the event NCL elects to offer its own items for sale on and through the System, NCL shall pay all related production costs incurred by SeaVision directly to SeaVision as a vendor and SeaVision will be entitled to a share of the Adjusted Gross Revenues generated therefrom pursuant to and in accordance with the terms of Section 3 of the Agreement. Access to the System by concessionaires on board the Ship, including but not limited to the on-board shops, casino, beauty salon and spa, and photographer, will be by mutual agreement between SeaVision and those vendors. NCL will be entitled to a portion of the Adjusted Gross Revenues generated by any fees paid by such purveyors, pursuant to and in accordance with the terms of Section 3 of the Agreement. . Advertising and Promotions: SeaVision shall have the exclusive right to provide access to the System to third parties for the purposes of advertising, promotions and marketing of their companies, products or services. NCL shall retain the right to approve such third party advertisers as will be given access to the System and the manner in which any such advertising is presented. NCL shall designate the individual responsible for granting such approvals on its behalf, and such individual shall provide SeaVision with general guidelines for advertising and marketing activities and the procedure SeaVision shall follow in submitting advertising and marketing proposals for NCL's consideration. NCL shall not unreasonably withhold its approval of advertising and marketing proposals with respect to the System. NCL shall notify SeaVision of its approval or denial of an advertising or marketing proposal within 14 days after SeaVision's written submission thereof. In the event NCL fails to notify SeaVision of its decision within that period, it shall be deemed to have approved that written submission. NCL will be entitled to a portion of the Adjusted Gross Revenues generated by such advertising and marketing promotions on the System, pursuant to and in accordance with the terms of Section 3 of the Agreement. Miscellaneous Optional Services (to be offered only upon mutual agreement of the - ------------------------------- parties) . Digital Photography: Passengers will be able to view in their cabins personal photographs taken by the on-board photo concessionaire. The system will display the photographs allowing the passengers to purchase a variety of sizes and poses. This service can include, subject to NCL approval, kiosk-based applications which will provide an entertaining and easy-to-use graphical, touch screen interface to purchase "instant" photographs with a wide variety of backgrounds and in various sizes. Revenues from photographs purchased over the System, less cost of materials, will be included in Adjusted Gross Revenues. EXHIBIT C On-board Television Coordinator Responsibilities ------------------------------------------------ [to be provided by NCL] EXHIBIT D Technical Performance Standards of the System --------------------------------------------- [Redacted - confidential treatment requested] EX-10.15 5 AGREEMENT WITH CUNARD LINE LTD. Exhibit 10.15 The marked portions of this Exhibit have been omitted and filed separately with the Commission pursuant to a request for confidential treatment. INSTALLATION AGREEMENT THIS INSTALLATION AGREEMENT (this "Agreement") is made and entered into as of the 9th day of September, 1996, by and between CUNARD LINE LIMITED, an English corporation with its registered office located at 52 Berkeley Street, London W1X 5FP England ("Cunard"), and SEAVISION, INC., a Delaware corporation having offices located at 300 Greentree Commons, 381 Mansfield Avenue, Pittsburgh, PA 15220 ("SeaVision"). RECITALS: A. Cunard has requested that SeaVision replace the existing television distribution and broadcast system onboard the Queen Elizabeth 2, a ship owned and operated by Cunard (the "QE2"). B. Cunard has also requested that, during such replacement, SeaVision operate and maintain the television distribution and broadcast system onboard the QE2. C. SeaVision has agreed to provide such requested services upon the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties, intending to be legally bound hereby, agree as follows: 1. Replacement of Existing Television Distribution and Broadcast ------------------------------------------------------------- System. - ------ SeaVision agrees to replace the existing television distribution and broadcast system onboard the QE2 as of the date hereof with a new television distribution and broadcast system comprised of the hardware components listed on Exhibit A attached hereto (collectively, the "Hardware"). The installation of the replacement system will be undertaken and completed for the fixed price set forth in Section 5(a) in accordance with the installation schedule attached hereto as Exhibit B (the "Installation Schedule"). TIME IS OF THE ESSENCE OF THIS AGREEMENT. Cunard acknowledges that the QE2 contains asbestos in certain of its structural components, and agrees that Cunard is responsible, at its own cost and expense, for undertaking all asbestos abatement and removal occasioned by SeaVision's installation of the replacement system, which abatement and removal will be undertaken in accordance with all applicable laws, rules and regulations and on a schedule that will permit SeaVision to perform its obligations hereunder in a timely manner. If SeaVision is delayed in its performance of its installation obligations under this Section 1 as a result of any delay by Cunard in the abatement or removal of asbestos onboard the QE2, SeaVision's obligations under the Installation Schedule shall likewise be delayed. 2. Scope of Operation and Maintenance Services to be Provided by ------------------------------------------------------------- SeaVision. - --------- (a) Commencing on October 20, 1996 and continuing for the balance of the term of this Agreement, and in accordance with the terms of this Agreement, SeaVision shall operate the television distribution and broadcast system onboard the QE2, as those activities are described in Exhibit C attached hereto, and shall provide such maintenance services as are required to keep the related broadcast equipment in good operating order and repair. Such operation will initially involve the existing television distribution and broadcast system onboard the QE2 and will involve the new television distribution and broadcast system as the same is installed onboard the QE2. In connection with SeaVision's performance of the foregoing operation and maintenance obligations, SeaVision shall provide all personnel reasonably necessary to fulfill such operation and maintenance obligations, including one broadcast control manager (the "Manager") who will remain onboard the QE2 on an on-going basis for so long as this Agreement is in effect. SeaVision acknowledges that the Manager and any other of its personnel from time to time onboard the QE2 shall at all times be employees of SeaVision. SeaVision understands and agrees that, while onboard the QE2, its personnel will be subject to the authority of the Master of the QE2 and the officer(s) designated to oversee the operation of the broadcast activities. SeaVision shall use its best efforts to ensure that its personnel will at all times while onboard the QE2 comply with the operations manual of Cunard, in the form then in effect. (b) SeaVision's personnel serving onboard the QE2 shall promptly be removed from such service, upon Cunard's request to SeaVision, in the event of: (i) intoxication while onboard the QE2; (ii) failure to comply with standards of professional and personal conduct expected by Cunard of its own employees and the employees of concessionaires onboard the QE2; and (iii) failure to abide by safety rules and regulations applicable to persons onboard the QE2. 3. Cunard Support. -------------- So long as SeaVision is providing the foregoing services to Cunard, Cunard shall: -2- (a) Make available to SeaVision: (i) the QE2 to the extent necessary for SeaVision's installation of the replacement distribution and broadcast television system and for SeaVision's operation and maintenance of the then-existing system in operation onboard the QE2, including but not limited to granting SeaVision personnel unlimited access to the television studio and video distribution system on board the QE2; (ii) such personnel as are reasonably necessary or appropriate to assist SeaVision in the successful installation of such replacement system and the successful operation and maintenance of such existing system; (iii) all necessary storage and work space onboard the QE2 for SeaVision's performance of its obligations hereunder; and (iv) appropriate single-cabin accommodations onboard the QE2 for SeaVision personnel who are engaged in such installation, operation and maintenance activities. The grade of such accommodations shall be at Cunard's discretion. It is understood that SeaVision personnel occupying such accommodations will, at all times while onboard the QE2, be subject to Cunard's policies regarding onboard contractors, including those concerning dress, decorum and personal behavior; and (b) Furnish accommodations onboard the QE2 on mutually-agreeable dates, to allow SeaVision senior personnel to monitor the on-going installation of such replacement system onboard the QE2, the on-going operation and maintenance of the then-existing system onboard the QE2 and the performance of SeaVision's personnel. Cunard shall also provide the Manager with all other perquisites that it provides to its employees of similar rank. 4. Term. ---- The initial term of this Agreement shall commence on the date hereof and shall expire on December 13, 1996. Thereafter, the term of this Agreement shall continue indefinitely, unless and until either party shall, at any time and for any reason, provide sixty (60) days' prior written notice to the other of the termination hereof. Notwithstanding the foregoing, Cunard may, at any time after SeaVision's completion of the installation of the Hardware onboard the QE2, terminate this Agreement upon fourteen (14) days' prior notice in the event QE2 is sold, bareboat chartered or time chartered to any third party for a period longer than one (1) month. -3- 5. Payments. -------- In consideration of SeaVision's performance under this Agreement, Cunard agrees to pay to SeaVision the following amounts: (a) for SeaVision's provision and installation of the replacement television distribution and broadcast system, Cunard shall pay to SeaVision the aggregate amount of One Million Two Hundred Forty Thousand U.S. Dollars (U.S. $1,240,000.00) (the "Purchase Price"), which amount shall be payable in accordance with the installation payment schedule attached hereto as Exhibit D. (b) for SeaVision's operation and maintenance of the then existing television distribution and broadcast system onboard the QE2, Cunard shall: (i) pay to SeaVision, commencing on October 20, 1996, the monthly amount of [Redacted - confidential treatment requested] (prorated for any partial month) for any period in which the QE2 is being used to perform passenger service, which monthly amounts shall be paid in arrears on or before the fifth day of each calendar month for the previous calendar month (no such monthly payment being due for any month in which the QE2 is out of service); and (ii) pay to Seavision an amount equal to [Redacted - -confidential treatment requested] of the cost incurred by SeaVision for parts, and supplies purchased by SeaVision, and third party repair charges incurred by SeaVision, in connection with its operation, maintenance and repair of the then existing television distribution and broadcast system onboard the QE2, which incurred costs shall exclude the cost of any warranty repair work performed by SeaVision in connection with its warranty of the system under section 11 herein and which costs shall be supported by SeaVision's delivery to Cunard of receipts therefor. Cunard shall pay all amounts due under this clause (ii) monthly concurrently with Cunard's payments under clause (i) herein. (c) Notwithstanding the foregoing, SeaVision understands and agrees that all payments made under this Agreement are conditioned upon timely progress and completion of the work in accordance with the Installation Schedule set forth in Exhibit B. In addition the final payment scheduled to be made on November 10, 1996 shall be conditioned upon prior completion of the installation and ensuring that the system is fully operational and in good working order. Should the contract work not be progressed or completed in a timely manner, Cunard shall have the right to withhold payment for all incomplete contract work always provided that Cunard shall submit to SeaVision within five (5) days after payment is otherwise due, a written notification specifying the cause for withholding payment. Should the parties fail to reach agreement on the manner in which the specified issues are to be resolved, then such dispute shall be resolved in accordance with Section 15. -4- 6. [Intentionally Omitted] 7. Insurance/Waiver of Subrogation. ------------------------------- (a) Cunard hereby warrants, represents and covenants that it has, and shall maintain for the term of this Agreement, at its sole expense, its normal insurance coverages for the QE2 and the equipment thereon. (b) So long as their respective insurers so permit, neither party hereto shall be liable to the other, or to the insurer of the other, claiming by way of subrogation through or under such other party with respect to any loss or damage, in whole or in part, to the extent that such other party shall be reimbursed out of that party's insurance coverage carried for such other party's protection with respect to such loss or damage. If so permitted, the parties shall each obtain any special endorsements required by their respective insurance carriers to evidence compliance with the waiver and release set forth herein and shall provide a copy thereof to the other party. (c) Cunard agrees to provide, at its own cost and expense, its normal maritime protection and indemnity insurance ("P&I") for the Manager and for each member of SeaVision's system installation crew for such periods of time as the Manager or crewmember, as the case may be, is employed by SeaVision and posted to the QE2, but only to the extent of Cunard's P&I coverage existing at the time of any claim. 8. Medical Care. ------------ At SeaVision's request, Cunard will furnish without charge, necessary onboard medical care by QE2's medical staff, as well as medicines, for illness and injury suffered by SeaVision's personnel while aboard the QE2. SeaVision is solely responsible for providing its personnel with any shoreside medical and/or dental care at its sole cost and expense. 9. Title. ----- Cunard acknowledges that unless and until it pays to SeaVision the Purchase Price in accordance with the terms of this Agreement, SeaVision shall retain exclusive ownership of the Hardware and Cunard shall have no right, title or interest therein. Upon Cunard's payment of each of the 2nd, 3rd and 4th Payments described on the installation payment schedule. SeaVision promptly shall convey to Cunard good and marketable title to approximately fourteen percent (14%) of the Hardware (based upon the value of the Hardware), free and clear of any liens, claims or other encumbrances. Upon Cunard's payment of the balance of the full amount of the Purchase Price to SeaVision, SeaVision promptly shall convey to Cunard good and marketable title to the balance of the Hardware (approximately 58%), free and clear of any liens, claims or other encumbrances. -5- 10. Warranty. -------- SeaVision hereby warrants its workmanship in connection with the installation of the replacement television distribution and broadcast system for a period of one (1) year after the completion of such installation. Any and all claims under the foregoing warranty must be delivered to SeaVision, in writing, within seven (7) days after the expiration of the warranty period. Cunard acknowledges that SeaVision is not the manufacturer of the Hardware and that warranties regarding the performance of the Hardware, if any, are provided solely by the respective manufacturers thereof, and not by SeaVision. SeaVision shall deliver to Cunard, upon completion of the installation of the replacement television distribution and broadcast system onboard the QE2, all information and documentation regarding such warranties as is then in SeaVision's possession or under its control. SeaVision shall assist Cunard in securing the benefits of any such warranties, but shall in no event be obligated under any such warranties. 11. Limitation of Liability. ----------------------- THE WARRANTIES AND REMEDIES EXPRESSLY SET FORTH IN THIS AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES AND REMEDIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OR ANY IMPLIED WARRANTIES ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE. EXCEPT AS EXPRESSLY PROVIDED HEREIN OR ELSEWHERE IN THIS AGREEMENT, IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION, IN THE CASE OF SEAVISION, ANY SUCH DAMAGES ARISING OUT OF CUNARD'S USE OF OR INABILITY TO USE THE TELEVISION DISTRIBUTION AND BROADCAST SYSTEM ONBOARD THE QE2 OR ANY PORTION THEREOF, EVEN IF SEAVISION IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN PARTICULAR, SEAVISION IS NOT RESPONSIBLE FOR ANY COSTS INCLUDING, BUT NOT LIMITED TO, THOSE INCURRED AS A RESULT OF LOST PROFITS OR REVENUE, LOSS OF USE OF THE TELEVISION DISTRIBUTION AND BROADCAST SYSTEM, OR CLAIMS BY THIRD PARTIES. IN ADDITION THERETO, NEITHER PARTY'S LIABILITY FOR DIRECT DAMAGES OF THE OTHER ARISING OUT OF ANY OF THE FOREGOING OR UNDER SECTION 13 OF THIS AGREEMENT SHALL IN NO EVENT EXCEED THE AMOUNT OF [REDACTED - CONFIDENTIAL TREATMENT REQUESTED]. 12. Confidentiality. --------------- (a) Each party agrees, during the term of this Agreement and thereafter, to maintain the confidential nature of the terms and conditions of this Agreement and of any proprietary information shared by the other with it. For purposes of this Section -6- 12(a), the term "proprietary information" excludes any information then in the public domain and any information that is independently, legally and without the breach of any agreement obtained from any third party. Notwithstanding anything contained in this Agreement to the contrary, the terms of this Section 12(a) shall survive the expiration or termination of this Agreement. (b) Each party acknowledges that its violation of its confidentiality or non-disclosure obligations under this Agreement may cause irreparable damage to the other that cannot be fully remedied by money damages. Accordingly, in the event of any such violation or threatened violation, the injured party will be entitled, in addition to pursuing any other remedy available to it under this Agreement or at law, to obtain injunctive or other equitable relief from any court of competent jurisdiction as may be necessary or appropriate to prevent any further violations thereof. (c) During the term of this Agreement (including any extensions thereof), and for a period of one (1) year thereafter, neither party shall induce or attempt to induce any employee or consultant of the other to terminate his or her employment or consulting relationship with such other party and shall not solicit any such employee or consultant for employment or consulting services. (d) Each party agrees to notify the other immediately upon the notifying party's becoming aware of or reasonably suspecting the possession, use or knowledge of all or part of any of the other party's proprietary information by any person or entity not authorized by this Agreement to have such possession, use or knowledge. The notifying party will promptly furnish the other party with details of such possession, use or knowledge, will assist in preventing a recurrence thereof and will cooperate with the other party in protecting the other party's rights in the other party's proprietary information. A party's compliance with the terms of this section 12 will not be construed as any waiver of the other party's right to recover damages or obtain other relief against the notifying party for the notifying party's breach of its confidentiality or non-disclosure obligations under this Agreement or the negligent or intentional harm to the other party's proprietary rights. 13. Indemnification. --------------- (a) SeaVision shall indemnify, defend and hold harmless Cunard and its successors and assigns from and against any and all liabilities, claims, suits, damages, judgments, awards, penalties, losses and other liabilities (including all related reasonable attorneys' fees, costs and expenses in connection therewith) (collectively referred to hereinafter as "Losses") suffered or incurred by Cunard by reason of, arising out of or in connection with: (i) any negligent act or omission of SeaVision (or an employee, agent or representative of SeaVision) committed or omitted, as the case may be, in the course of SeaVision's performance of the terms of this Agreement; or -7- (ii) SeaVision's failure to fully perform the terms of this Agreement. (b) Cunard shall indemnify, defend and hold harmless SeaVision and its successors and assigns from and against any and all Losses suffered or incurred by SeaVision by reason of, arising out of or in connection with: (i) any liability arising from or out of asbestos onboard the QE2, unless such liability arises as a result of SeaVision's negligence, willful misconduct or failure to observe Cunard's instructions relating to such asbestos; (ii) any negligent act or omission of Cunard (or an employee, agent or representative of Cunard) committed or omitted, as the case may be, in the course of Cunard's performance of the terms of this Agreement or its operation of the QE2; or (iii) Cunard's failure to fully perform the terms of this Agreement. (c) The terms of this Section 13 shall survive the expiration or termination of this Agreement. 14. Interruption in Performance. --------------------------- Neither Cunard nor SeaVision shall be liable to the other for any loss, damage or loss of profits arising out of any interruption or cessation of performance hereunder when such interruption or cessation is caused by any circumstance beyond the reasonable control of such party. 15. Arbitration. ----------- In the event of any dispute or controversy arising out of or related to this Agreement, the parties will seek to resolve any such controversy first by negotiating with each other in good faith in face-to-face negotiations between the respective principals of each. In the event a resolution is not reached in such manner, any remaining dispute or controversy shall be submitted for resolution by either party to any court of competent jurisdiction in City of New York, New York County, New York. 16. Public Announcements. -------------------- The parties shall consult with each other and issue a public statement with respect to this Agreement as soon as is practical after the date hereof. -8- 17. Right to Make Agreement. ----------------------- Each of the parties hereto represents and warrants to the other that it has all necessary and appropriate power and authority to execute, deliver and carry out the terms and provisions hereof and that its execution, delivery and performance thereof will not constitute a default by it under any other agreement to which it is a party. 18. Counterparts. ------------ This Agreement may be executed in any number of counterparts, each of which shall constitute an original and all of which together shall constitute but one and the same original document. 19. Assignment. ---------- Either party hereto may assign this Agreement and its respective rights, interests and obligations hereunder to any third party without the consent of the other party hereto; provided, however, that no such assignment by a party shall relieve that party of any of its liabilities or obligations hereunder. It is expressly understood and agreed that, except as provided to the contrary in the preceding sentence, this Agreement and all of SeaVision's interests and rights herein and hereunder may be assigned, pledged, mortgaged and/or hypothecated by SeaVision in connection with the sale or transfer of all or substantially all of its assets or a change in the ownership of a controlling interest in SeaVision's capital stock. 20. Successors. ---------- This Agreement shall inure to the benefit of, and be binding upon, the respective successors and assigns of the parties hereto. 21. Effectiveness. ------------- This Agreement shall be effective upon its execution by an authorized representative of each party hereto, which execution may for all purposes be evidenced by facsimile transmission of a counterpart signature page of this Agreement. 22. Governing Law. ------------- This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its principles of conflicts of laws. 23. Severability. ------------ If any Section or provision of this Agreement, or any portion of any section or provision thereof, shall for any reason be held to be void, illegal or otherwise -9- unenforceable, all other sections and portions of this Agreement shall nevertheless remain in full force and effect as if such void, illegal or unenforceable portion had never been included herein. 24. Notices. ------- All notices and other communications required or otherwise provided for in this Agreement shall be in writing and sent by registered or certified mail to: If to SeaVision: SeaVision, Inc. 300 Greentree Commons 381 Mansfield Avenue Pittsburgh, PA 15220 Attn: Brian K. Blair Telecopier: 412/928-0887 If to Cunard: Cunard Line Limited 555 Fifth Avenue New York, New York 10017 Attn: Robert Parry Telecopier: 212/949-0915 or to such other place as SeaVision or Cunard, as the case may be, may from time to time designate in accordance herewith. 25. Entire Agreement; Modification. ------------------------------ This Agreement, including the Exhibits attached hereto, contains the entire agreement of the parties on the subject matter hereof, and supersedes any and all prior agreements, if any, with respect to such subject matter. This Agreement may not be changed, modified or supplemented except by the written agreement of the parties. 26. Default. ------- (a) The following shall constitute "Events of Default" under this Agreement: (i) The failure of either party in any respect to perform any of the covenants, agreements or undertakings on its part to be performed under this Agreement, provided, the other party shall have given written notice to the defaulting party as to such failure, and such defaulting party shall not, within thirty (30) days time after being so notified, have shown it has taken sufficient steps to correct such failure. -10- (ii) A general assignment made by either party for the benefit of its creditors, the filing by either party of a petition in voluntary bankruptcy or of a petition for reorganization or for other relief under any bankruptcy or insolvency law, the filing of a petition by either party at common law or in equity for the appointment of a receiver in any court, or the filing against either party by one or more of its creditors of a petition seeking the appointment of a receiver of such party's assets, whether temporary or permanent, or a petition seeking relief under any bankruptcy or insolvency law, which petition shall not have been dissolved within sixty (60) days from the date of the filing of the petition in that court. (b) If an Event of Default occurs, the non-defaulting party may terminate this Agreement by giving written notice thereof to the defaulting party, whereupon the non-defaulting party shall have the right to withhold its future performance under this Agreement without, in any way, releasing the defaulting party from any of its obligations under this Agreement. IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date first above written. ATTEST: SEAVISION, INC. - ------------------------ By: ----------------------------------- Its: Its: -------------------- ---------------------------------- ATTEST/WITNESS: CUNARD LINE LIMITED - ----------------------- By: ----------------------------------- Its: Its: -------------------- ---------------------------------- -11- EXHIBIT A [Redacted - confidential treatment requested] EXHIBIT B BROADCAST STUDIO AND TELEVISION REFIT INSTALLATION SCHEDULE
=========================================================================================== Task Date SeaVision team arrives on the ship to perform a thorough survey of the Completed ships facilities. Survey team will complete a test of the integrity of the existing RF system. Select a location for racks and specify power and cooling requirements for the Broadcast Control Center (BCC). - ------------------------------------------------------------------------------------------- Penetration drawings sent to QE2 to facilitate penetrations during SOLAS Completed work. - ------------------------------------------------------------------------------------------- Project manager to review all outstanding issues (TV stands, penthouse By 08/09 TV's, Public area TV's, and programming) with Cunard Management. - ------------------------------------------------------------------------------------------- Eight person RF team arrives to begin installation of new RF trunkline to 09/23 carry NTSC signal. Team to work section by section closing up as they install new trunk to cause minimal passenger disturbance. - ------------------------------------------------------------------------------------------- Move all necessary equipment from broadcast center to temporary 10/13 location in cabin next to BCC. Broadcast signal from temporary studio in NTSC and PAL format. Both systems broadcasting identical programming. - ------------------------------------------------------------------------------------------- Begin changing all televisions in passenger cabins from PAL to NTSC. 10/19 As television is changed, drop lines will be switched from PAL trunkline to NTSC trunk. TCM's installed on all televisions. - ------------------------------------------------------------------------------------------- Remodeling studio to accommodated new equipment, racks, and 10/19 television studio. Install new NTSC equipment in BCC. Test all newly installed equipment. - ------------------------------------------------------------------------------------------- SeaVision operator to arrive on QE2. SeaVision operator to coordinate 10/20 with Hotel Director and Cruise Director to increase programming and decide activities to film. SeaVision operator to provide Hotel Director a new schedule of all programming. - ------------------------------------------------------------------------------------------- Transfer signal from temporary broadcast center to permanent studio. 11/03 Removal of all equipment from temporary studio. - ------------------------------------------------------------------------------------------- All cabins switched to NTSC signal. Broadcast center now sending only 11/10 NTSC signal. Television system completed, work begins on ITV. ===========================================================================================
EXHIBIT C TV STATION MANAGER - QUEEN ELIZABETH 2 Reports to: Deputy Cruise Director General Duties: Operates, maintains and plans schedules for a television and radio broadcasting service. Specific Duties: Plans a daily schedule of TV programmes on eight channels, six of which are running 24 hours per day. This includes a regularly changed selection of children's programmes, documentaries, feature films, music videos, opera, and a daily theme channel. Ensures that all broadcasts commence promptly at the advertised time (some of this work is delegated to the A.V.O. operator). Operates all T.V. Station equipment (multi-system VCR machines, laser disc machines, vision mixer, time-base corrector, cameras, lights, audio mixers, monitors, etc.). Submits accurate daily schedules to the print shop for advertising purposes. Facilitates the recording and production of special onboard programmes (interviews, magazine-style programmes, introductions to featured programmes and Tour Office promotions). Supervises a daily radio show (presented by the Disc Jockey). Skills Necessary: Experience in communications. Preferably some experience in broadcasting. A good speaking voice. A detailed knowledge of feature films, directors and actors that can be utilized in effective programming, especially of themed presentations. Good knowledge of all types of music. Some technical knowledge relating to required areas of operation. Creative camera skills for use with both studio and location work. Neat appearance. EXHIBIT D INSTALLATION PAYMENT SCHEDULE Total Installation Price $1,240,000.00 [Redacted - confidential treatment requested] EX-10.16 6 AGREEMENT WITH ROYAL CARIBBEAN CRUISES LTD. Exhibit 10.16 The marked portions of this Exhibit have been omitted and filed separately with the Commission pursuant to a request for confidential treatment. CONCESSION AGREEMENT -------------------- THIS CONCESSION AGREEMENT ("Agreement") is made and executed this 17th day of September, 1996 by and between SEAVISION INC., a Delaware corporation ("SEAVISION") and ROYAL CARIBBEAN CRUISES LTD., a Liberian corporation ("RCCL"). W I T N E S S E T H: -------------------- RCCL operates the vessels MAJESTY OF THE SEAS and RHAPSODY OF THE SEAS (which vessel is currently under construction and scheduled to be delivered in April 1997) (collectively the "Vessel" or "Vessels"); SEAVISION has the expertise in providing interactive television and video entertainment systems; and RCCL desires to grant to SEAVISION a concession on the Vessels as described herein and SEAVISION desires to accept the concession, on the terms set forth herein: 1. Concession. RCCL hereby grants to SEAVISION and SEAVISION hereby accepts the concession for providing an interactive television and video entertainment system to RCCL, and passengers on each Vessel on the terms and conditions set forth herein. 2. SEAVISION's Responsibilities. ---------------------------- a) Services. SEAVISION hereby agrees to provide, at no charge to RCCL, an -------- interactive television and video entertainment system (the "System") consisting of the hardware and software described or listed on Exhibit A attached hereto, and to provide the services (the "Services") set forth on Exhibit B attached hereto. The System shall conform to the technical performance standards set forth on Exhibit C and the specifications set forth on Exhibit D attached hereto. RCCL may elect to use customized graphic displays ("look and feel") for the System on the television screens, which displays must be compatible with the then existing technical standards of the System, provided that if RCCL so elects, RCCL shall bear the cost of development of such graphics. SEAVISION agrees that there [Redacted - confidential treatment requested] where RCCL uses existing language and merely changes the logo on a screen or similar minor changes. If RCCL elects to use such customized graphics displays, RCCL may either (i) develop such customized graphics itself or contract for such development through a third party, in which event SEAVISION will reasonably cooperate with RCCL or such third-party, or (ii) request SEAVISION to develop such customized graphics, in which event SEAVISION will undertake such development on terms mutually agreeable to the parties. SEAVISION agrees that the cost for such customization [Redacted - confidential treatment requested]. This amount includes [Redacted - confidential treatment requested] required by RCCL; [Redacted - confidential treatment requested]. The [Redacted -confidential treatment requested] will be provided for the first four RCCL Vessels [Redacted - confidential treatment requested]. On any additional vessels, the [Redacted - confidential treatment requested] shall be [Redacted - confidential treatment requested]. SEAVISION shall be responsible for [Redacted - confidential treatment requested]. b) Upgrades. SEAVISION agrees to provide upgrades to the hardware and/or -------- software used in the System, at no cost to RCCL, at such times and in such manner as is reasonably necessary or appropriate, in SEAVISION's sole opinion, to maintain the System. RCCL shall have the right to review and approve any such upgrade prior to its installation on any Vessel, which approval shall not be unreasonably withheld or delayed by RCCL. c) Installation. The System shall be installed and fully functional ------------ onboard the MAJESTY OF THE SEAS on or before December 10, 1996. The installation on RHAPSODY OF THE SEAS shall be completed and the System fully operational prior to April 25, 1997. d) Maintenance. SEAVISION shall be responsible for ensuring that the ----------- System is in good, proper working order at all times during the Term of this Agreement. The System shall at all times meet the technical specifications set out in Exhibit C to this Agreement. SEAVISION shall coordinate all work on the System with each Vessel's Chief Engineer and/or Chief Electrician. e) Comment Cards. SEAVISION acknowledges that RCCL distributes to and ------------- collects from passengers comment cards requesting satisfaction ratings of on-board services. SEAVISION agrees to address any issues raised by such comment cards and to use reasonable efforts to comply with RCCL requests to make changes to the System to correct deficiencies noted in the System which are identified in the comment cards. 3. RCCL's Responsibilities. ----------------------- a) Access to Vessel. RCCL hereby agrees to make available to SEAVISION in ---------------- respect to each Vessel (a) the Vessel to the extent necessary for SEAVISION's installation, operation and maintenance of the System, including but not limited -2- to granting SEAVISION personnel reasonable access to the television studio and video distribution system, (b) such personnel as are reasonably necessary or appropriate to assist in the successful installation, operation and maintenance of the System, including but not limited to appropriate on-board support for, and oversight of, the installation, operation and maintenance of the System by a designated officer on that Vessel (provided however, primary responsibility for maintenance and upkeep shall be the responsibility of SEAVISION), (c) all reasonably necessary systems integration support to allow the System to communicate with RCCL's on-board systems, and (d) appropriate accommodations on-board the Vessel for the SEAVISION personnel who are engaged in installing, operating or maintaining the System on the Vessel. b) Executive Personnel. With the prior approval of RCCL, SEAVISION's ------------------- executive personnel may travel from time to time on the Vessels as needed to insure the performance by SEAVISION of its obligations hereunder. In such cases, RCCL will make available, at no charge (except for port charges, gratuities and personal items), passenger- type accommodations for such executive personnel, unless all passenger facilities have been utilized by paying passengers. Such executive personnel shall travel alone on a space available basis and not with their families or other guests and shall be bound by and subject to all the terms and conditions of RCCL's passenger ticket contract. c) Marketing. RCCL hereby agrees to provide reasonable marketing support --------- for the System on-board the Vessels. Such marketing support shall include, but not be limited to in-cabin collateral material, coverage in the Cruise Compass and daily television guide (if any), mention by the Cruise Director during his or her introductory remarks to passengers on the Ship, and such other activities of a supporting nature as are acceptable to both parties to this Agreement. RCCL hereby agrees to work with SEAVISION's marketing personnel to develop appropriate and effective means for testing and gauging passenger reaction to the System on a regular basis. RCCL shall from time to time, provide access to the Vessels while in their home port for SEAVISION personnel and guests to demonstrate the System to potential advertisers, marketers and clients. Such visits shall be requested in advance and RCCL reserves the right to refuse to allow such visitors onboard the Vessels on certain days. In addition, access to various parts of the Vessel may be restricted. d) Data. RCCL hereby agrees to provide the SEAVISION onboard manager with ---- the following data in electronic form (i.e., diskettes, tapes or similar means) with respect to each passenger onboard the Vessel: name, cabin assignment, dining assignment and folio number. In the event SEAVISION acquires any additional passenger information such as addresses and phone numbers as a result of the -3- passenger's use of the System (e.g. through the purchase of items to be mailed to the passenger's home), SEAVISION agrees to keep such information in confidence and not to sell, exchange or otherwise provide such information to any other party without the prior written consent of RCCL. Without limiting the foregoing, SEAVISION shall not sell any lists of RCCL passenger names or use such names in any manner other than as may be required to fulfill its obligations under this Agreement. In the event SEAVISION is required to provide the information to a fulfillment house to process orders, SEAVISION shall use commercially reasonable efforts to ensure that such information is kept confidential by such fulfillment house. e) Collection of funds. RCCL hereby agrees to collect all monies paid or ------------------- payable by passengers in respect of Services provided on or through the System and charged to the respective on-board account of such passengers, except as set forth in Section 6 of this Agreement. f) Equipment. RCCL hereby agrees to provide all in-cabin televisions and --------- television control modules; provided however, the [Redacted - confidential treatment requested] for such television control modules shall be [Redacted - confidential treatment requested] and SEAVISION shall be [Redacted - confidential treatment requested]. SEAVISION shall identify the specifications and requirements for such television control modules. RCCL shall have [Redacted - confidential treatment requested]. RCCL shall retain title to all television sets and control modules. 4. Regular Television. RCCL shall retain all rights to use and control the ------------------ contents of [Redacted - confidential treatment requested]. RCCL shall have the right to operate [Redacted - confidential treatment requested]. RCCL's programming on such channels may include, but is not limited to, [Redacted - confidential treatment requested]. 5. Revenue-Sharing. For each Vessel under this Agreement, the following --------------- revenue sharing shall apply: a) SEAVISION shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Gross Revenue. b) Once the aggregate of the Adjusted Gross Revenue equals or exceeds [Redacted - confidential treatment requested] (the "Revenue Sharing Date") then: i) RCCL shall be entitled to retain [Redacted - confidential treatment requested] of the first [Redacted - confidential treatment requested] of -4- the Adjusted Gross Revenues during the twelve (12) months immediately following the Revenue Sharing Date and each twelve (12) month period thereafter during the term of this Agreement; and ii) RCCL shall be entitled to retain [Redacted - confidential treatment requested] of the Adjusted Gross Revenue between [Redacted -confidential treatment requested] during the twelve (12) months immediately following the Revenue Sharing Date and each twelve (12) month period thereafter during the term of this Agreement; and iii) RCCL shall be entitled to retain [Redacted - confidential treatment requested] of all Adjusted Gross Revenues exceeding [Redacted -confidential treatment requested] during the twelve (12) months immediately following the Revenue Sharing Date and each twelve (12) month period thereafter during the term of this Agreement. c) "Adjusted Gross Revenue" for purposes of this Agreement, shall mean the aggregate of all amounts paid to RCCL by passengers in connection with use of the Revenue Generating and Pay-Per-View Services provided by the System and charged to such passengers' respective onboard accounts by RCCL on each Vessel less the cost of goods set forth in Exhibit E. 6. Payment Terms. ------------- a) Reports. On or before the twenty-first day of each calendar month ------- during the Term of this Agreement, SEAVISION shall provide RCCL with a written report detailing the Adjusted Gross Revenue from cruises completed during the prior calendar month (any cruise commencing before last day of month will be considered completed in that current month). The report shall separately identify the Adjusted Gross Revenue for each module and the cost of goods and shall be in the form attached as Exhibit F. This report shall govern the determination of fees to be retained by RCCL and the revenues to be remitted by RCCL to SEAVISION under the terms of this Agreement. In addition, SEAVISION shall provide the reports listed on Exhibit G, samples of which reports are attached as part of Exhibit G. SEAVISION shall provide any and all hardware and/or software reasonably necessary or appropriate to interface SEAVISION's accounting software with the Vessel's property management system in order for SEAVISION to obtain accurate accounting information for such reports, as further discussed in Section 3a)(c) above. b) Settlement. Within thirty (30) days after RCCL's receipt of the ---------- monthly report delivered to RCCL by SEAVISION pursuant to the terms of subsection a) above, -5- RCCL shall remit to SEAVISION the Adjusted Gross Revenue during the calendar month applicable to such report, less RCCL's share of such Adjusted Gross Revenue as provided in Section 5. SEAVISION shall pay to RCCL its portion of the Adjusted Gross Revenue associated with the advertising within thirty (30) days of the close of each month. c) Refunds. SEAVISION shall be [Redacted - confidential treatment ------- requested] (collectively the "Refunds") attributable to the Services hereunder. Such Refund shall be made by RCCL on the passenger's credit card (if applicable) and RCCL shall be [Redacted - confidential treatment requested]. All communications regarding Refunds should be made to RCCL's Accounting Department, attention Supervisor, Collections. SEAVISION agrees to cooperate and promptly respond to requests for information regarding any Refund. SEAVISION shall not make any Refunds directly to the passenger, unless the purchase was made on a separate credit card processed by SEAVISION. RCCL shall be entitled to [Redacted - confidential treatment requested]. SEAVISION shall [Redacted - confidential treatment requested]. d) Credit Cards. RCCL, in its sole option, has the right to [Redacted - ------------ confidential treatment requested]. In such event, SEAVISION shall pay RCCL its portion of the Adjusted Gross Revenue attributable to such purchases within thirty (30) days of the close of each month. 7. Term. This Agreement shall be effective as the date of execution hereof ---- and shall continue for a period of [Redacted - confidential treatment requested]. Either party may cancel this Agreement, without cause, upon [Redacted - confidential treatment requested] prior written notice to the other party; provided, however, such notice cannot be given until at least -------- ------- [Redacted - confidential treatment requested] after execution of this Agreement. The Agreement is-cancelable for cause in accordance with the provisions set forth in Section 17 of this Agreement. 8. Additional Vessels. ------------------ a) Grandeur and Enchantment. RCCL has the option to add its vessels, ------------------------ GRANDEUR OF THE SEAS (delivery scheduled for December 1996) and ENCHANTMENT OF THE SEAS (delivery scheduled for July 4, 1997), or either one of them, as additional vessels under this Agreement. Such additional vessels shall be governed by the same terms and conditions contained in this Agreement and, if added, shall be considered a "Vessel" as said term is defined in this Agreement. Either party may [Redacted - confidential treatment requested], as to those additional vessels upon [Redacted - confidential treatment requested] prior written notice to the other party; provided, however, -------- ------- -6- such notice cannot be given as to such vessels [Redacted - confidential treatment requested]. RCCL shall give SEAVISION notice of its desire to add the System on these vessels at least [Redacted - confidential treatment requested] in advance of the required installation date. b) Other Vessels. In the event RCCL desires to add other vessels to this ------------- Agreement, [Redacted - confidential treatment requested]. SEAVISION acknowledges that in the event RCCL [Redacted - confidential treatment requested], or if RCCL [Redacted - confidential treatment requested], that RCCL shall have the right to [Redacted - confidential treatment requested]. c) [Redacted - confidential treatment requested]. RCCL agrees that during --------------------------------------------- the period between execution of this Agreement and [Redacted - confidential treatment requested], RCCL shall [Redacted - confidential treatment requested]. 9. Facilities and Equipment. ------------------------ a) "As is". SEAVISION accepts "as is" the existing facilities and ----- fixtures on the Vessels for the Concession. SEAVISION accepts "as is" the existing storage facilities and all water, electricity, television cabling and air conditioning systems incident to SEAVISION's operations on the Vessel with consideration given to the fact that the Vessel's storage facilities are limited. SEAVISION shall have the opportunity of making a detailed site inspection of the facilities prior to installation of the System. SEAVISION has provided RCCL with specifications regarding HVAC and electrical requirements, which specifications are attached hereto as Exhibit H. RCCL agrees that it shall be RCCL's obligation to ensure that the HVAC and electrical specifications are met. b) Damage. SEAVISION shall give RCCL prompt written notice of any damage ------ to or defective condition in any part of the plumbing, electrical, heating, air conditioning, television cabling or other system serving, located in, or passing through the areas in which the Concession is operating. Except as otherwise provided herein, SEAVISION shall, at its own expense, keep the facilities under its control in good order and condition during the term of this Agreement. SEAVISION shall not make any alterations or additions to the such facilities without the prior written consent of RCCL. Upon the termination of this Agreement, RCCL shall have the option of requiring SEAVISION to remove any such improvements at SEAVISION's cost and expense. c) Storage. Subject to the provisions of subsection f) below, SEAVISION ------- shall be solely responsible for its storage areas and facilities and will bear the risk of loss -7- caused by SEAVISION's breach of any governmental regulation or for SEAVISION's failure to comply with requirements relative for the manifesting of goods for customs purposes and for loading or off- loading on Landed Goods Advice (LGAs). d) Locks and Security. RCCL will provide normal locks, seals and security ------------------ for storage areas and RCCL will cooperate in all efforts to provide security for the property of SEAVISION, including all reasonable efforts to see that said areas are not invaded or otherwise entered. RCCL acknowledges that SEAVISION has no enforcement or disciplinary power as to personnel other than SEAVISION's employees on board the Vessel and RCCL agrees that the Vessel, through its Master, will cooperate with SEAVISION to enforce security of SEAVISION's property through such disciplinary measures or procedures as are reasonably necessary and required. e) Safe Storage. Subject to the approval of the Master, SEAVISION shall ------------ safely stow for sea, and will maintain such safe stowage for sea, all stores and other of its property, as well as all equipment, furniture, or other items and any other property belonging to RCCL which SEAVISION may use to perform its obligations hereunder, or which otherwise may be in SEAVISION's control. f) Unseaworthy Condition. SEAVISION shall not knowingly create an --------------------- unseaworthy condition in the performance of its obligations hereunder. SEAVISION shall operate the Concession in a safe, careful and businesslike manner. g) Carrier's Release. Upon expiration or termination of this Agreement ----------------- for whatever reason, RCCL agrees to provide SEAVISION with a carrier's release releasing all of SEAVISION's goods, equipment and wares for off-loading, at the regularly scheduled port or port(s), as SEAVISION may select, and that it will, in no way, inhibit or hamper SEAVISION's right to take possession of the goods, equipment and wares and remove the same from the Vessel, provided that all sums due RCCL or the Vessel have been paid or placed in escrow or a bond for said amount is purchased by SEAVISION. Notwithstanding anything to the contrary herein, SEAVISION shall at all times retain title to all components of the System which are provided by SEAVISION. 10. On-Board Personnel. ------------------ a) Training. SEAVISION will engage in its service aboard the Vessel one -------- (1) employee sufficiently trained and licensed in his/her duties who will perform SEAVISION's obligations hereunder and in accordance with the terms of this Agreement in a courteous and efficient manner so as to meet high standards of -8- operation ("SEAVISION's Operator(s)"). RCCL shall have the option of [Redacted - confidential treatment requested] at RCCL's expense, and SEAVISION agrees to [Redacted - confidential treatment requested]. RCCL agrees that [Redacted - confidential treatment requested]. Such RCCL personnel shall be bound by the confidentiality provisions of this Agreement. b) Rooms. SEAVISION's Operator shall be berthed in a [Redacted - ----- confidential treatment requested]. The Operator shall be considered the equivalent of [Redacted - confidential treatment requested] and shall have the rights and privileges (as generally set out on Exhibit I.) associated with [Redacted -confidential treatment requested]. c) Meals. SEAVISION's Operator shall eat staff food in the appropriate ----- staff dining areas. d) Appearance. SEAVISION's Operator shall, at all times, keep ---------- himself/herself neatly groomed, well spoken and suitably attired in compliance with Master's Standards. e) Control. Subject to the provisions of Section 12, SEAVISION, at all ------- times, has the obligation and right to control all of the personnel engaged by SEAVISION to perform its obligations hereunder. 11. Experience. SEAVISION represents that it is an experienced concessionaire ---------- fully qualified to supervise and operate the Concession. SEAVISION shall obtain and maintain in full force and effect throughout the term of this Agreement, any and all permits or licenses necessary to operate the Concession, including but not limited to trademark and copyright licenses. 12. Certain Obligations ------------------- a) Health and Moral Character. SEAVISION shall only employ persons who -------------------------- are in good health, sober and of good moral character. Each of SEAVISION's Operators must hold a doctor's health report on a form approved by RCCL indicating that the employee is medically fit for service on board the Vessel in accordance with standards established by RCCL and which are the same as for RCCL's own employees. It shall be SEAVISION's sole responsibility to employ persons who have valid passports, visas and all other permits required by any governmental authority whether United States or foreign in order that they might enter and leave the ports of call of the Vessel. -9- b) SEAVISION Employees. SEAVISION's Operators are solely the employees ------------------- of SEAVISION and shall, under no circumstances, be deemed employees of RCCL. SEAVISION is solely responsible for the payment of all wages, vacation pay, commissions, benefits and repatriation expenses of each of its employees. SEAVISION shall comply with all applicable laws, governmental regulations or other governmental requirements relating to wages, tax withholding and benefits paid to employees and governing SEAVISION's conduct in connection therewith. c) Independent Contractor and Waiver of Maritime Lien. SEAVISION -------------------------------------------------- understands that it is not the agent of RCCL but is an independent contractor and has no right to pledge the credit of RCCL or any Vessel in any manner or sum whatsoever. SEAVISION shall not contract with any supplier of merchandise unless the supplier executes a purchase order containing a conspicuous notice to the effect that SEAVISION has no right or authority to bind any Vessel or create a lien upon them and that by acceptance of such purchase order, the supplier acknowledges that he/she looks solely to SEAVISION and not the Vessel for payment of goods ordered. Neither SEAVISION nor SEAVISION's Operator shall have the right to assert maritime liens on any Vessel for any payments due to them and SEAVISION, on behalf of itself and its employees, hereby waives any rights that SEAVISION or its employees may have to assert claims against RCCL under the Jones Act, U.S. Code Section 688 et seq, or any other applicable law. In the event that a lien is placed on any Vessel in contradiction of the terms hereof or as a result of any act, omission or neglect by SEAVISION or its employees, SEAVISION shall remove immediately, by bond or otherwise, any such lien or reimburse RCCL for the cost incurred by RCCL in obtaining its removal. Neither this Concession Agreement nor the relationship of the parties hereby created constitutes a partnership or a joint venture. d) Picket Lines. SEAVISION shall immediately take all lawful action, at ------------ its sole expense, to effect removal of any picket line or other impediment to a Vessel's sailing resulting from any labor dispute between SEAVISION and its employees or subcontractors. e) Agent. SEAVISION irrevocably appoints the Master and Vessel's Hotel ----- Manager as its agent, with the power of overall supervision of SEAVISION's Operator for purposes of health, safety and discipline of each Vessel. For this purpose, SEAVISION's Operator will sign on Ship's Articles and obey the Master's Rules and Regulations. The foregoing will not in any way detract from or modify SEAVISION's status as an independent contractor or its employer-employee relationship with its personnel, and its right to control its employees as described herein. -10- f) Repatriation. In the Master's discretion, and for purposes of health, ------------ safety and discipline, the Master of any Vessel may require any employee of SEAVISION to be removed with the employee's belongings from the Vessel at any time when the Vessel is in port. If for any reason any of SEAVISION's Operator is unable to be on board a Vessel upon its scheduled departure from any port, SEAVISION shall be responsible for the repatriation of said party, and SEAVISION shall be fully responsible for any and all fines, penalties, and assessments levied by any third party in connection with any violation of the immigration laws of any government, nation, or country. g) Prohibited Acts. SEAVISION's Operator are not permitted: --------------- i) To carry or consume on board any Vessel any narcotic or other drug which is prohibited, or for which a doctor's prescription would be required, except pursuant to a program of medical care under the direct supervision of the Vessel's doctor; ii) To board the Vessel in an intoxicated state or to consume alcoholic beverages aboard the Vessel to the point of intoxication or to the point where during the subsequent performance of their duties such consumption could become apparent to the passengers; iii) To engage in any form of gambling aboard the Vessel; and iv) To sell any merchandise to passengers or crew members except in the course of their duties and only during the agreed hours of operation of SEAVISION's Concession thereunder. 13. Insurance. --------- a) Marine Hull and Machinery. RCCL agrees that the Vessel's owners shall, ------------------------- at their own expense, provide and maintain marine hull and machinery and war risk hull and machinery insurance covering the Vessel, with first class marine underwriters, which insurance shall be endorsed to designate the owners as the sole loss payee. In the event that SEAVISION or its employees cause any loss or damage covered by this insurance, or which would have been covered by this insurance but for any deductible, SEAVISION agrees to reimburse owners for the deductible applicable to such loss or damage; provided however, SEAVISION's obligation to reimburse shall not exceed [Redacted - confidential treatment requested]. While SEAVISION will not be named in this insurance as an additional assured, neither the owners nor the underwriters shall have any further -11- right of recovery or subrogation in excess of said deductible against SEAVISION on account of any loss or any damage covered by such insurance. b) Protection and Indemnity. RCCL shall, at its own expense, obtain and ------------------------ maintain protection and indemnity insurance with first-class Marine Underwriters which shall provide coverage to RCCL and SEAVISION. In the event that SEAVISION or its employees cause any loss or damage covered by this insurance, or which would have been covered by this insurance but for any deductible, SEAVISION agrees to reimburse owners for the deductible applicable to such loss or damage; provided however such reimbursement shall not exceed [Redacted - confidential treatment requested]. c) Medical. RCCL shall provide, at no charge to SEAVISION, the use of its ------- shipboard medical facilities for employees of SEAVISION while working on the vessel. In addition, RCCL will permit SEAVISION to use the shoreside medical facilities with which RCCL has provider agreements for medical care for SEAVISION's employees who are working on RCCL's vessels; provided, however, if SEAVISION elects to use such shoreside facilities, SEAVISION shall reimburse RCCL for all expenses associated with such medical care. d) SEAVISION's Insurance. SEAVISION shall maintain general liability --------------------- insurance, in form and content acceptable to RCCL. Such insurance shall name RCCL as an additional named insured and shall provide that the insurance may not be canceled or modified without at least thirty (30) days prior written notice to RCCL. [Redacted - confidential treatment requested]. e) Limitation of Liability. Except as expressly provided elsewhere in ----------------------- this Agreement, no party shall be liable for any indirect, special or consequential damages arising out of this Agreement. SEAVISION's liability shall not exceed [Redacted - confidential treatment requested] in the aggregate, provided however, that the foregoing limitations shall not apply to damages resulting from the gross negligence or willful misconduct or SEAVISION, its employees or agents. The warranties expressly set out in this Agreement are exclusive and are in lieu of all other warranties, express or implied, including without limitation the implied warranty of merchantability and fitness for a particular purpose or any implied warranties arising from course of performance, course of dealing or usage of trade. 14. Itinerary Changes, Sale of Vessel etc.. RCCL, in its sole discretion and -------------------------------------- without liability to SEAVISION, may change the itineraries of the Vessels. RCCL may sell or charter any Vessel to bona fide unaffiliated third parties, or otherwise remove any Vessel from the cruise trade, in which case [Redacted - confidential treatment requested]. In the -12- event RCCL sells or removes a Vessel from the cruise trade [Redacted - confidential treatment requested], RCCL agrees to [Redacted - confidential treatment requested] a) Assign RCCL's contract rights and obligations on the Vessel being sold to the new owner of the Vessel; b) Install the System on a different RCCL vessel, which vessel shall be subject to SEAVISION's approval, which shall not be unreasonably withheld; or c) [Redacted - confidential treatment requested] 15. Force Majeure. RCCL shall not be liable to SEAVISION for any cruise ------------- delays, cancellations or deviations, or any loss or damage to SEAVISION's property, caused by acts outside the reasonable control of RCCL, including Acts of God, acts of war, public enemies, government restrictions, perils of the sea, mechanical difficulties, seizure or arrest of the Vessel, or acts of passengers or other third parties. 16. Indemnification. --------------- a) SEAVISION. SEAVISION shall indemnify and hold harmless RCCL, the --------- Vessels' owners, the successors and assigns of the foregoing, and their respective officers, directors, employees and agents from and against all damages, liabilities, claims and expenses (including attorneys' fees and payments for deductibles under any insurance policies) arising from or based upon SEAVISION's operations, or any act, omission or neglect by SEAVISION or its employees or agents. b) RCCL. RCCL shall indemnify and hold harmless SEAVISION, its successors ---- and permitted assigns, and their respective officers, directors, employees and agents from and against all damages, liabilities, claims and expenses (including attorneys' fees and payments for deductibles under any insurance policies) arising from or based upon RCCL's operations or any act, omission or neglect by RCCL or its employees or agents. 17. Default. ------- a) Termination Upon Default. Either party may terminate this ------------------------ Agreement immediately upon the occurrence of an event of default by the other party. The following shall constitute events of default under this Agreement: i) Breach by either party of its obligations under this Agreement, which such breach shall not be remedied within thirty (30) days after receipt by the breaching party of written notice thereof from -13- the other party; provided however, if such breach is as a result of software errors or malfunctions, the cure period shall be [Redacted - confidential treatment requested] from receipt of written notice and SEAVISION shall provide RCCL with a written plan and timetable to remedy such software problem within fifteen (15) days of receipt of written notice of such breach; or ii) The making by either party of any statement, representation or warranty in this Agreement or in any document furnished or to be furnished to the other party in connection herewith which shall prove to be knowingly or recklessly untrue or incorrect in any material respect, when made; or iii) Either party (A) applying for or consenting to the appointment of a receiver, trustee or liquidator of all or a substantial part of its assets; (B) being unable or failing to pay or admitting in writing its inability or failure to pay its debts as they mature; (C) making a general assignment for the benefit of creditors; (D) being adjudicated a bankrupt or insolvent or being dissolved; (E) filing a petition in bankruptcy or for reorganization or for an arrangement pursuant to a bankruptcy act or any insolvency law; or (F) filing an answer admitting the material allegation of, or consenting to, or defaulting in answering a petition filed against it, in any bankruptcy, reorganization or insolvency proceeding. b) Rights and Remedies. Termination of this Agreement upon an event of default shall be without prejudice to any other rights and remedies available to the terminating party. 18. Applicable Law. This Agreement shall be governed by and interpreted in -------------- accordance with the laws of Florida to the exclusion of all choice-of-law rules which might otherwise be applicable except to the extent that circumstances would reasonably require application of the admiralty and maritime laws of the United States or the maritime laws of some other jurisdiction to resolve specific issues pertaining solely to health and safety or to mandatory requirements imposed by the laws of the state of the Vessel's registry. Venue for all matters hereunder shall be in the courts in Miami, Florida. 19. Confidentiality. Except as permission may be specifically granted to --------------- SEAVISION in writing and in accordance with RCCL's rules, SEAVISION agrees to hold in confidence and not disclose to any third party, except to authorized persons in the course of its work for RCCL, any and all information or data of a confidential nature not generally available to the public that is delivered to SEAVISION, or that SEAVISION obtains, in the course -14- of its work for RCCL, relating to the business or operations of RCCL or its associated companies, including, but not limited to, financial information, marketing plans, passenger names, personal data and addresses, designs, processes and agreements. SEAVISION further agrees to comply with all confidentiality agreements between RCCL and third parties (to the extent SEAVISION is notified of such agreements) and understands that its obligations under this confidentiality provision shall continue after the expiration of this Agreement and until RCCL specifically releases such obligations in writing. Except as permission may be specifically granted to RCCL in writing and in accordance with SEAVISION's rules, RCCL agrees to hold in confidence and not disclose to any third party, except to authorized persons in the course of its work, any and all information of a confidential nature not generally available to the public that is delivered to RCCL, or that RCCL obtains, in the course of its work with SEAVISION, or as a result of SEAVISION's performance of its obligations under this Agreement, relating to the business or operations of SEAVISION or its associated companies, including, but not limited to, (i) any knowledge gained by RCCL of SEAVISION's proprietary application software or the configuration of the System; (ii) SEAVISION's marketing and sales materials; (iii) the format of SEAVISION's reports, including those for data management, revenue remittance and marketing surveys; and (iv) SEAVISION's marketing and financial information. RCCL further agrees to comply with all confidentiality agreements between SEAVISION and third parties (to the extent RCCL is notified of such agreements) and understands that its obligations under this confidentiality provision shall continue after the expiration of this Agreement and until SEAVISION specifically releases such obligations in writing. RCCL acknowledges that the System represents and will continue to represent the valuable, confidential and proprietary property of SEAVISION. SEAVISION is not by this Agreement conveying to RCCL any exclusive proprietary or ownership rights in the System, including, but not limited, to any patent, copyright, trademark, service mark, trade secret, trade name or other intellectual property rights, except that RCCL will have the limited rights expressly set forth in this Agreement. Accordingly, RCCL acknowledges that, except as expressly provided for in this Agreement, RCCL possesses no title to or ownership of any System or any portion thereof. RCCL will keep the System free and clear of all claims, liens and encumbrances resulting from actions or omissions of RCCL. Each party agrees, during the Term of this Agreement and thereafter, to maintain the confidential nature of the terms and conditions of this Agreement. Each party acknowledges that its violation of its confidentiality or non- disclosure obligations under this Agreement may cause irreparable damage to the other that cannot -15- be fully remedied by money damages. Accordingly, in the event of any such violation or threatened violation, the injured party will be entitled, in addition to pursuing any other remedy available to it under this Agreement or at law, to obtain injunctive or other equitable relief from any court of competent jurisdiction as may be necessary or appropriate to prevent any further violations thereof. 20. Miscellaneous. ------------- a) Entire Agreement. This Agreement shall constitute the entire agreement ---------------- between the parties relative to concessions on the Vessels and all prior negotiations, agreements and communications shall be merged herein and superseded hereby. b) Amendments. The terms of this Agreement may not be waived, altered, ---------- modified, amended or supplemented in any manner whatsoever except by a written document duly executed by both parties hereto. c) Assignments. Neither party may assign this Agreement, in whole or in ----------- part, without the prior written consent of the other party. The foregoing is not intended to apply to a sale of the stock of either company or a merger or consolidation which results in a change of ownership of the company. d) Press Releases. The parties shall consult with each other and issue a -------------- press release with respect to this Agreement as soon as practical after the execution hereof. During the term of this Agreement, RCCL agrees to use best efforts to include a reference to SEAVISION in any press releases relating to any vessels on which the System is installed (or is planned to be installed) and in which interactive television services are discussed. e) Waivers. No waiver by any party of any inaccuracy of representation, ------- breach or rights or remedies provided hereunder and no course of dealing shall be deemed a continuing waiver of the same inaccuracy, breach or any other right or remedy, unless such waiver is in writing and is signed by the party sought to be bound. The failure of a party to exercise any right or remedy shall not be deemed a waiver of such right or remedy in the future. f) Modification and Severability. If a court of competent jurisdiction ----------------------------- declares that any provision of this Agreement is illegal, invalid or unenforceable, then such provision shall be modified automatically to the extent necessary to make such provision fully legal, valid or enforceable, and this Agreement otherwise shall remain in full force and effect. -16- g) Enforceability. This Agreement shall be enforceable by and against -------------- RCCL and SEAVISION and their respective successors and permitted assignees. h) Books and Records. SEAVISION shall at all times keep complete and ----------------- accurate books, records and accounts pertinent to this Agreement. Said books, records and accounts shall be retained for a period of at least three (3) years after the expiration or other termination of this Agreement and shall, at all reasonable times, be accessible to and open for inspection, examination, audit and copying by RCCL. i) Notices. All notices, demands, requests and other communications ------- required or permitted to be given to any party hereto in connection herewith (1) must be in writing and (2) may be served either by (A) depositing the same in the mail, full postage prepaid, certified or registered with return receipt requested, (B) delivering the same by an internationally recognized air courier service, full delivery cost paid, (C) delivering the same in person, or (D) sending a telecopy of same, confirming with a copy thereof delivered either by mail or air courier service. Any notice, demand, request or other communication served in the foregoing manner shall be deemed given upon delivery in person, three business days after mailing, two business days after sending by air courier, or on the first business day after sending by telecopy. For the purposes hereof, the addresses and telecopier numbers of the parties hereto are as follows: If to RCCL: Royal Caribbean Cruises Ltd. 1050 Caribbean Way Miami, Florida 33132 Attn: Executive VP, Operations Telecopier Number (305) 372-0441 cc: Legal Department If to SEAVISION: SeaVision Inc. 381 Mansfield Avenue Pittsburgh, PA 15220 Attn: Brian Blair, Chief Operating Officer Telecopier Number (305) 377-2221 Any party hereto may change its address for the purposes hereof by giving notice of such change of address to the other party in the manner provided herein. IN WITNESS WHEREOF, RCCL and SEAVISION have executed this Agreement the dates set forth below. -17- SEAVISION INC., a Delaware Corporation By: ------------------------------- Name: Brian Blair Title: Chief Operating Officer Dated: September 17, 1996 Royal Caribbean Cruises Ltd., a Liberian corporation By: By ------------------------------ ------------------------------- Name: Peter G. Whelpton Name: G. Edward Bollinger Title: Executive Vice President, Title: Vice President, Purchasing Operations Properties & Logistics Dated: September 17, 1996 Dated: September 17, 1996 -18- Exhibits -------- Exhibit A: Description of System (hardware and software components) Exhibit B: Description of Services Annex 1: Gaming Guidelines Exhibit C: Technical Performance Standards Exhibit D: Specifications Exhibit E: Cost of Goods Exhibit F: Settlement Form Exhibit G: List of Reporting Requirements Exhibit H: HVAC Specifications Exhibit I: Privileges -19- EXHIBIT A Primary Hardware and Software Components of the System to be provided by SeaVision [Redacted - confidential treatment requested] EXHIBIT B Entertainment and Interactive Services to be Provided by SEAVISION ------------------------------------------------------------------ "Basic" SEAVISION Package: Services Provided at No Charge - --------------------------------------------------------- . In-Cabin Room Service Ordering: Passengers will be able to order RCCL's standard room service menu, including beverages charged to their cabin account, through the System. Orders will be printed out in appropriate pantries and/or galleys for delivery by RCCL personnel. SEAVISION shall provide, as part of the System, printers and/or monitors to be used in such pantries and/or galleys for such purpose. . Shore Excursion Ordering: Passengers will be able to watch videos of shore excursions and purchase tickets for shore excursions on and through the System by using their television remote-control. Orders will be printed out in the appropriate shore excursion office of RCCL, with tickets in respect thereof to be delivered by RCCL personnel. The System, at RCCL's option, will provide appropriate inventory control. SEAVISION will assist with the development of the interface with RCCL's shore excursion system. . Guest Survey: The System shall include guest satisfaction and guest information surveys the forms of which are to be agreed upon by RCCL. RCCL may periodically adjust or revise such questions. . Cruise Compass: The System shall include the daily Cruise Compass. . Wine Ordering: Passengers will be able to view a wine menu on the System and order their selection with their television remote-controls. Orders will be printed out in the Wine Steward's office or wine cellar, for delivery by RCCL personnel at the designated meal. . Interface with RCCL's Property Management System: The System will interface with the Vessel's property management system to enable appropriate charges to be applied to passenger accounts. . Interface with RCCL's Shore Excursion System: The System will interface with the Vessel shore excursion system to enable shore excursion tickets to be ordered and appropriate charges to be applied to passenger accounts. . Passenger Folio Review: Each passenger will be able to use the System to review a summary of their on-board account. . Access Control: The System will be designed to limit access to only those persons who are adult passengers or who are minors under adult supervision. Passengers will be able to limit access to various services, such as gaming and adult programming, by enabling lock-out codes and using password procedures. . Report Generation: The System will generate detailed activity reports, which will be made available to RCCL for the purposes of revenue payments to SEAVISION. SEAVISION shall also provide, at RCCL's request, reports pertaining to passenger usage of the System. . Language Options: The System will have the modules available in various languages, to be mutually agreed upon between RCCL and SEAVISION. . Future Cruise Module: RCCL will be able to feature information on other cruises and itineraries through the System. . Gaming Tutorials: The system shall provide on demand access to various gaming tutorials. . Safety Instructions: The System shall provide on demand access to safety information regarding the Vessel. RCCL shall be responsible for providing all ticket stock, videos and photographs for shore excursions, wine ordering, gaming tutorials, future cruise modules and safety instructions. RCCL shall retain control over all materials included in such programs. RCCL may choose, at its option, to produce its own videos and photographs, retain SEAVISION for this purpose and reimburse SEAVISION for all its costs incurred in connection with producing the same, or contract with a third party to produce such videos and/or photographs, provided, however, that any videos and photographs produced by any such third party shall in all ways meet SEAVISION's technical standards for use on the System. If RCCL elects to have SEAVISION produce any such videos or photographs, SEAVISION shall provide RCCL with detailed cost estimates prior to the initiation of video and photograph production. Such estimates will include the cost of preproduction scripting and preparation and the cost of sending crews aboard RCCL's Vessels for taping, photographing and post-production editing. RCCL shall pay these costs directly to SEAVISION as a supplier. In the event RCCL selects to use any shore excursion videos in SEAVISION's library [Redacted - confidential treatment requested], RCCL agrees to permit SEAVISION to use any generic shore excursion videos prepared by RCCL to be used by SEAVISION on other cruise vessels on which SEAVISION has installed the System. RCCL shall have [Redacted - confidential treatment requested] and in the event RCCL selects to -2- [Redacted - confidential treatment requested], then RCCL shall [Redacted -confidential treatment requested]. Revenue-Generating and Pay-Per-View Entertainment Services - ----------------------------------------------------------- RCCL will be entitled to a portion of the Adjusted Gross Revenues generated by the following revenue services, pursuant to and in accordance with the terms of Section 5 of the Agreement. RCCL may [Redacted - confidential treatment requested] upon [Redacted - confidential treatment requested] prior written notice to SEAVISION; provided the following conditions are met: (i) In the event of [Redacted - confidential treatment requested], the revenue sharing arrangement set forth in Section 5 of the Agreement [Redacted -confidential treatment requested]; (ii) No revenue service may be [Redacted - confidential treatment requested]; (iii) RCCL may [Redacted - confidential treatment requested]; and (iv) RCCL shall pay SEAVISION monthly an amount equal to SEAVISION'S portion of the [Redacted - confidential treatment requested]. Such payment shall be based upon the [Redacted - confidential treatment requested] and shall take into account [Redacted - confidential treatment requested]; provided however, such payment shall [Redacted - confidential treatment requested] (a) [Redacted - confidential treatment requested] (b) [Redacted - confidential treatment requested] Revenue Services: . Video-on-Demand: Passengers will be able to purchase movies and other entertainment options such as taped concerts, on demand, using the System and their television remote-control. SEAVISION shall determine the fee that will be levied for each such order and charged to such passengers' respective onboard accounts. Such fee shall be subject to RCCL's prior approval, which shall not be unreasonably withheld, and in any event shall be consistent with the fees charged for similar services on comparable cruise lines and luxury hotels. Subject to RCCL's approval, adult programming may be offered. SEAVISION shall be -3- responsible for all licenses, including but not limited to copyright licenses, which are needed in order to show such entertainment. . Gaming Options: Passengers will be able to play video slots, blackjack and poker on the System. Any additional games that SEAVISION may desire to provide on the System shall be subject to the parties' mutual agreement. [Redacted -confidential treatment requested]. Specific requirements and guidelines regarding the Gaming Options are defined Annex 1 to this Exhibit. . Shopping: SEAVISION will offer passengers interactive video shopping on the System. Third Party Vendors. RCCL will retain the right to approve and disapprove the items offered for sale and the third party suppliers providing those items. RCCL has the right to require any items to be deleted upon [Redacted -confidential treatment requested] notice. All such suppliers shall offer a minimum of a thirty (30) day money back guarantee on all items sold via this service. All third party suppliers shall promptly and professionally respond to complaints regarding such items and shall maintain a toll-free number to expeditiously handle such complaints. All items shall be delivered to the passenger's selected address within two weeks of ordering. SEAVISION shall obtain a signature of any passenger ordering items through the System. SEAVISION will provide fulfillment services for products sold through the System which are not offered by RCCL or RCCL's concessionaires on board the Vessel. RCCL shall have the right to offer its own items for sale on the System. In the event RCCL elects to offer its own items on the System, RCCL shall pay SEAVISION [Redacted - confidential treatment requested] of the adjusted gross revenue of the sales of such RCCL goods and products. SEAVISION shall not be entitled to any other portion of the revenues generated by the sale of such RCCL goods. SEAVISION shall [Redacted - confidential treatment requested]; provided [Redacted - confidential treatment requested] with the normal and customary shopping provided on the System (e.g. the format currently used by [Redacted - confidential treatment requested]. In the event RCCL wishes to present its goods in a manner which is different than such goods on the System, RCCL shall be [Redacted - confidential treatment requested]. . Advertising and Promotion: SEAVISION shall have the exclusive right to sell advertising on the System [Redacted - confidential treatment requested] to third parties for the purposes of advertising, promotions and marketing of their companies, products or services. SEAVISION does not have the right to [Redacted - confidential treatment requested], unless RCCL expressly approves such advertising in writing in advance. RCCL shall retain the right to approve such third party advertisers and the manner in which any such advertising is presented. RCCL shall designate -4- the individual responsible for granting such approvals on its behalf, and such individual shall provide SEAVISION with general guidelines for advertising and marketing activities and the procedure which SEAVISION shall follow in submitting advertising and marketing proposals for RCCL's consideration. At the time of the request for approval, SEAVISION shall identify the length of time of the advertising commitment, [Redacted -confidential treatment requested]. RCCL shall notify SEAVISION of its approval or denial of any advertising proposal within 15 business days after SEAVISION's written submission thereof. In the event RCCL fails to notify SEAVISION [Redacted - confidential treatment requested]. Interactive advertising on the System by concessionaires on board the Vessel, including but not limited to the beauty salon and spa and photographer will be by mutual agreement between SEAVISION and those suppliers. RCCL will be entitled to a portion of the Adjusted Gross Revenues generated by any fees paid by such concessionaires, pursuant to and in accordance with the terms of Section 5 of the Agreement. Notwithstanding the foregoing, nothing herein or in the Agreement is intended to prevent RCCL from [Redacted - confidential treatment requested], including but not limited to, advertising and promotion of the beauty salons, photographers, port lecturers and port shopping, casinos, gift shops, shore excursions, suppliers and similar such activities. SEAVISION shall [Redacted - confidential treatment requested]. In addition, SEAVISION acknowledges and agrees that the promotion of RCCL's services and suppliers on the System (e.g. the display of third party logos together with the promotion or description of goods being offered on the Vessel as described in the Basic SeaVision package for the Vessel) shall [Redacted - confidential treatment requested]. By way of example, the use of a vineyard's logo by the products on the wine ordering services module, the display of a beverage supplier's logo near the beverages on the room service menu, or the featuring of a particular shore excursion, shall [Redacted - confidential treatment requested]. . Digital Photography: RCCL at its option, may select as an additional feature for the System to provide digital photography. If selected, passengers will be able to view in their cabins personal photographs taken by the on-board photo concessionaire. The system will display the photographs allowing the passengers to purchase a variety of sizes and poses. This services can include, subject to RCCL approval, kiosk based applications which will provide an entertaining and easy-to-use graphical, touch screen interface to purchase "instant" photographs with a wide variety of backgrounds and in various sizes. In the event RCCL selects to offer such service, the terms of the service shall be set forth in an addendum to this Agreement. -5- . Crew Amenities: RCCL, at its option, may elect to have additional services provided to its crew on the Vessels, subject to the prior mutual agreement of the parties. -6- Annex 1: Gaming Options - Requirements and guidelines RCCL shall have control over all game rules, denomination, theoretical hold percentage and award structure (including all jackpots). [Redacted - confidential treatment requested] RCCL has the right to [Redacted - confidential treatment requested] RCCL will [Redacted - confidential treatment requested]; which hours shall be set taking into account applicable laws, rules and regulations and which shall be consistent with the hours set for RCCL's own casino. RCCL shall have the right to [Redacted - confidential treatment requested]. All such changes shall be made in the presence of an approved RCCL employee (e.g., slot technician). SEAVISION shall ensure that all video gaming complies with any and applicable rules, regulations and laws, including but not limited to the regulations of the Nevada Gaming Control Board. -6- EXHIBIT C Technical Performance Standards for the System [Redacted - confidential treatment requested] Exhibit D Specifications [Redacted - confidential treatment requested] Exhibit E "Adjusted Gross Revenues" - Cost of Goods [Redacted - confidential treatment requested] EXHIBIT F 12-Aug-96 SEAVISION, INC. Detailed Income Statement By Period Period Ending 06/30/96 ROYAL CARIBBEAN CRUISE LINES ----------------------------
Current Year Totals Period to Date to Date ------- ------- ------- REVENUE: Revenue - Advertising $0.00 $0.00 $0.00 Revenue - Gaming $0.00 $0.00 $0.00 Revenue - Movies $0.00 $0.00 $0.00 Revenue - Shopping $0.00 $0.00 $0.00 ----- ----- ----- Total Revenue $0.00 $0.00 $0.00 ----- ----- ----- COST OF GOODS: Shopping Products $0.00 $0.00 $0.00 Pay Per View Fees: Swank Motion Pictures $0.00 $0.00 $0.00 Graff, Inc. $0.00 $0.00 $0.00 Advertising Commissions $0.00 $0.00 $0.00 ----- ----- ----- Total Costs of Goods $0.00 $0.00 $0.00 ----- ----- ----- Adjusted Gross Revenues $0.00 $0.00 $0.00 ===== ===== ===== REVENUE SHARE $0.00 $0.00 $0.00 ===== ===== ===== DUE TO SEAVISION $0.00 $0.00 $0.00 ===== ===== =====
Page 1 Exhibit F MOVIES - Pay per view Swank Motion Pictures ---------------------
Date Voyage # No. Revenues No. Revenues 06/01/96 08960525 0 $0.00 0 $0.00 06/08/96 08960601 0 $0.00 0 $0.00 06/15/96 08960608 0 $0.00 0 $0.00 06/22/96 08960615 0 $0.00 0 $0.00 06/29/96 08960622 0 $0.00 0 $0.00 - ------------------------------------------------------ Totals 0 $0.00 0 $0.00 - ------------------------------------------------------ Accumulated Totals 0 $0.00 - --------------------------------------- DUE TO SWANK $0.00 =====
Page 3 Exhibit F MOVIES - Pay per view Graff, Inc. -----------
Date Voyage # No. Revenue 06/01/96 08960525 0 $0.00 06/08/96 08960601 0 $0.00 06/15/96 08960608 0 $0.00 06/22/96 08960615 0 $0.00 06/29/96 08960622 0 $0.00 - ------------------------------------------ Accumulated Totals 0 $0.00 - ------------------------------------------ DUE TO GRAFF $0.00 =====
Page 4 Exhibit F SHOPPING VENDORS: Thornberry ----------
Date Voyage # Retail Shipping Revenues 06/01/96 08960525 $0.00 $0.00 $0.00 06/08/96 08960601 $0.00 $0.00 $0.00 06/15/96 08960608 $0.00 $0.00 $0.00 06/22/96 08960615 $0.00 $0.00 $0.00 06/29/96 08960622 $0.00 $0.00 $0.00 - ---------------------------------------------------- Totals $0.00 $0.00 $0.00 - ---------------------------------------------------- Accumulated Totals $0.00 $0.00 $0.00 - ---------------------------------------------------- THORNBERRY [Redacted - confidential treatment requested] $0.00 (SEAVISION [Redacted - confidential treatment requested]) SHIPPING $0.00 ----- DUE TO THORNBERRY $0.00 -----
Page 5 Exhibit F EXHIBIT G [Redacted - confidential treatment requested] EXHIBIT H Electrical and HTAC Specifications - ---------------------------------- [Redacted - confidential treatment requested] EXHIBIT I --------- The following is a list of [Redacted - confidential treatment requested] privileges SeaVision personnel assigned as crew to the vessel are entitled to: . Public Areas. Access to ship's public areas to include the Night Club ------------ (subject to vessels' curfew); access to public areas is subject also to certain designated areas, i.e., designated areas to sunbathe, times to use guest Spa facilities, etc. . Dining. All meals will be taken in the Staff Mess. Use of the Windjammer ------ Cafe is prohibited. Mid-night Buffet use is permitted only if on-duty. . Bar Privileges. 50% on all bar charges to be paid each pay period. -------------- . Gift Shop. 20% on purchases. No crew are permitted to purchase alcohol by --------- bottles. . Out-Island Privileges. Access to Out Islands is permitted. Guests have --------------------- priority on use of all Out Island facilities. Meal service permitted in last 1/2 hour of service period. . Boat Drill. Mandatory attendance at crew boat drill. ---------- . Dress Code. SeaVision personnel must adhere to the dress of the day while ---------- in public areas. -----END PRIVACY-ENHANCED MESSAGE-----