Confidential draft term sheet

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For the avoidance of doubt, this term sheet is not binding and Sony and Adobe reserve the right to make changes.


Sony Pictures Television, Inc. with offices at 10202 West Washington Blvd., Culver City, CA 90232 (“Sony”).


Crackle, Inc., a subsidiary of Sony (“Crackle”).


Adobe Systems Inc. with offices at 345 Park Avenue, San Jose, CA 95110 (“Adobe”).



Effective Date

October 1, 2014 (“Effective Date”)


Commencing on the Effective Date and expiring on October 1, 2017 (the “Term”).

New Crackle CTV Apps

Adobe will deliver to Sony five (5) new Crackle apps with a redesigned, interactive TV experience (the “New Crackle CTV Apps”). Platforms will include Android TV, Roku, Amazon Fire TV, Xbox One and PlayStation 4. The New Crackle CTV Apps will have the following:

  • New visual design as defined by Crackle UI wireframe document

  • New interaction design per scoping meetings

  • Features and functionalities as defined by Crackle in its Product Requirements Document

Full scope of the New Crackle CTV Apps to be defined and documented by contract execution date.

Adobe will provide or contract to a third party, to be mutually approved by Sony and Adobe, to perform the following services:

  • Visual / UI / UX design

  • Project management

  • Solution design

  • Enablement consulting

  • Application development

  • QA testing

  • UAT testing

  • Submission to stores

Phase 1 Date: Adobe to deliver three (3) New Crackle TV Apps for the Android TV, Roku platforms and Amazon Fire TV for Beta launch at CES 2015 (January 6th, 2015).

Phase 2 Date: Adobe to provide Production/GA versions of Phase 1 Crackle TV Apps on Android TV, Amazon Fire TV and Roku platforms by March 1, 2015.

Phase 3 Date: Adobe to deliver two (2) New Crackle TV Apps for Xbox One and PS4 platforms by June 15, 2015.

Phase 4 Date: Adobe to provide consulting services for Crackle integration of Primetime and re-launching of existing applications on Xbox 360, Desktop, iOS and Android by a date defined by Sony. .

Sony will retain ownership of the New Crackle CTV Apps, including without limitation, the source code, with the exception of libraries that are only licensed via object code licenses, for example Adobe Primetime TVSDK or You.I.Labs UI framework.


Sony will license Primetime for implementation on:

  • All New Crackle CTV Apps by the appropriate Phase Date mentioned above.

  • Other Crackle apps to launch on a date defined by Sony, but at least on Desktop, iOS and Android.

Primetime includes:


  • Hosted Adobe DRM configuration (where it is available, and studio approved).

  • Ad Insertion Configuration

Audience Manager

Sony will license Audience Manager across the entire Crackle service, including, for the avoidance of doubt, for all New Crackle CTV Apps and for all other Crackle apps.

Implementation timeline:

Adobe to perform the following services:

  • Project management

  • Site Catalyst Data Ingestion

  • CRM/Reg Data Connection

  • Inclusion of AAM for Device ID capture & variable data capture via Site Catalyst if applicable

  • 2nd Party (publisher advertiser) data connections

  • 3rd Party Data Provider Overlap, Discovery, Connectivity

  • Freewheel & DSP Integrations

  • Standardized audience taxonomy to categorize user demographics, behaviors, shows

  • Nielsen Integration

Adobe will partner with Nielsen to enable Nielsen ratings within the Adobe Marketing Cloud (the “Nielsen Partnership”), including:

  • A new Nielsen Site (Content) ratings product built on Adobe Analytics measurement data

  • Nielsen Digital Program Ratings, and ability to target based on ratings

  • Nielsen Online Campaign Ratings, and ability to target based on OCR ratings

  • Nielsen audience demographic data (Nielsen panel, DPR, OCR data sources) at the most granular level possible, and content metadata identified via watermark

By October 15, 2014 (the “Confirmation Date”), Adobe will confirm that Nielsen has agreed to move forward with the Nielsen Partnership and that the Nielsen Partnership will be implemented by a mutually agreed upon date, currently approximated to be April 1, 2015 (the “Implementation Date”). The exact features to be developed by Adobe will be mutually agreed upon by Sony and Adobe.

In the event that Adobe does not or cannot confirm that Nielsen and Adobe have executed a written agreement reflecting the Nielsen Partnership by the Confirmation Date, Sony may immediately terminate the Agreement at any time, and Adobe shall provide Sony with a pro-rated refund of all fees pre-paid by Sony measured from the effective date of the termination. After the Confirmation Date, if (i) Adobe continues to be unable to confirm that Nielsen and Adobe have executed a written agreement reflecting the Nielsen Partnership, and (ii) Sony terminates the Agreement in the period of time after the Confirmation Date and prior to the Implementation Date, then Adobe shall additionally pay Sony a time and materials fee of $25,000 per month, measured from the effective date of termination.

In the event that Adobe fails to implement the Nielsen Partnership as part of the marketing cloud described within the agreed upon scope by the Implementation Date, then Adobe will pay to Crackle liquidated damages of $100,000 per month for each month that such Nielsen Partnership is not implemented. Adobe acknowledges and agrees that the actual damages likely to result from Adobe’s failure to implement the Nielsen Integration are difficult to estimate on the date of this agreement and would be difficult for Sony to prove. The parties intend that Adobe’s payment of the liquidated damages would serve to compensate Sony for Adobe’s failure to implement the Nielsen Partnership, and not as punishment for any such failure by Adobe.

Adobe will assign to Sony a named Technical Account Manager for the Term and limited to 500 hours to consult and troubleshoot usage of Audience Manager across the Crackle applications.

Primetime_Professional_Services'>Primetime Professional Services

Adobe to provide professional services to enable the experience as defined in the Crackle product requirements documents, by the dates defined above, including but not limited to:

  • Phase 1 & 2 (Android TV, Amazon Fire TV and Roku):

    • Solution Design for Primetime integration with Crackle’s content preparation, CMS, ad server and CDN delivery.

    • Enablement Consulting for all platforms in Phase 1 & 2

    • Channel Switching POC

    • Project Management

    • Hosted Adobe DRM Configuration

    • Ad Insertion Configuration for all platforms in Phase 1 & 2

  • Phase 3 (Xbox One and PS4)

    • Enablement Consulting for all platforms in Phase 3

    • Project Management

    • Ad Insertion Configuration for all platforms in Phase 3

  • Phase 4 (Existing apps on Desktop, iOS, Android & Xbox 360)

    • Enablement Consulting for all platforms in Phase 4

    • Project Management: Capped at 400 hours

    • Ad Insertion Configuration for all platforms in Phase 4

Additionally, Adobe will provide a named technical account manager on-going technical support services for Production/GA Primetime enabled Crackle applications.



  • For Primetime components, Crackle will be invoiced for the greater of the monthly minimum or actual CPM based usage. Additional properties, apps or content may be subject to additional monthly fees.

  • Primetime TV SDK Base Package includes license for player SDKs for VOD playback; AES 128 decryption; HDS/HLS protection with a universal key; 608/708 closed captioning; support for ID3 tags; failover and advanced bitrate switching logic; packager and origin server software; and real-time player reporting. For the avoidance of doubt, in the event Adobe DRM is not available for a certain platform, Adobe must utilize and implement a Sony approved DRM for such platforms.

  • "Stream" is defined as up to 60 minutes of content or ad playback for connected TV platforms and mobile/tablet devices

  • Outside of the scope of the aforementioned implementation, professional services are to be billed depending on the scope of engagement. There may be Professional Services fees in addition to implementation fees depending on the amount of custom development or launch support required.

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