iesy Repository GmbH - Irish Stock Exchange

The licenses granted to ish under the Betacrypt agreements allow ish to access existing MSG/Premiere set-top boxes
and to distribute its digital offering in North Rhine-Westphalia using its own smart cards. As a result, those of ish’s end
customers who already have MSG/Premiere set-top boxes/smart cards can now use ish’s Nagra smart cards to receive ish’s
digital content in North Rhine-Westphalia, and ish no longer needs to depend on the “ish zone” of the MSG smart cards to
distribute its digital offering.
However, such end customers now have to use two or more smart cards (“mixed use”) for the reception of Premiere
and ish digital content because the license terms do not allow the use of a combined card. The addendum reflects the parties’
intention to agree to a one smart card solution by October 31, 2005. If the parties fail to come to an agreement by that date,
each party will have the right to terminate the addendum with four weeks’ prior notice. If the addendum is terminated, the
right to mixed use ends and ish will no longer have the right to distribute ish content using ish smart cards to those of its
subscribers who are also Premiere subscribers.
The licenses granted under the Betacrypt agreements expire on December 31, 2007 if not extended. The fee for the
license is €150,000 for the first 120,000 ish smart cards and €1 for each additional ish smart card. Although the license is
restricted to ish and the North Rhine-Westphalia territory, the parties have agreed to negotiate in good faith the extension of
the agreements to iesy and to the Hesse territory by October 31, 2005.
Convergys
On December 18, 2000, Convergys Information Management Group Inc. (“Convergys”) granted ish a non-transferable
and non-exclusive license to use the “CableMaster” software for its customer support and billing operations. The license
agreement is effective for the longer of the duration of the copyright of the licensed program materials and derivative works
or 50 years, while the maintenance and support agreement is effective for an initial period of five years and will be
automatically renewed for subsequent periods of 12 months unless terminated with six months’ prior written notice. In
addition, the license agreement may be terminated for cause by either party and the maintenance and support agreement may
be terminated by Convergys if ish’s hardware or operating software cease to be able to run the system successfully.
Nortel
On April 25, 2003, ish concluded a support agreement with Nortel Networks Germany GmbH & Co. KG under which
ish was granted a non-exclusive, perpetual, non-transferable, royalty-free and worldwide license to network related software
and the provision of respective software upgrades. The scope of the agreement for support has been amended and extended in
time to the end of 2005 and is terminable by ish to the end of the year with three months’ prior written notice, and by Nortel
with immediate effect if ish fails to make payments thereunder for a period of 30 days after notice of such failure has been
given.
AlixPartners LLC
James Bonsall, until recently the CEO of ish, provided his services to ish pursuant to a contract ish had with
AlixPartners LLC. AlixPartners LLC provided CEO and program management services to ish. Since 2002, AlixPartners LLC
provided various personnel to effect the restructuring of ish. All AlixPartners LLC roles have been replaced by ish employees
or such roles have been eliminated. The contract between ish and AlixPartners LLC terminated upon the successful
completion of the ish Acquisition and James Bonsall resigned from his positions as Chief Executive Officer of ish and as
Managing Director of Kabelnetz, Kabelnetz GP, ish GP, ish KS GP and KSG and Parm Sandhu was appointed to these
positions.
Other
ish also leases fiber capacity in connection with the network upgrade from other telecommunications service providers
under several dark fiber service agreements. Where an amount has been prepaid upon signing of the agreement, it is
amortized over the life of the agreement resulting in a non-cash charge to ish’s income statement.
Intellectual Property
The operators of telecommunications cable networks are required under the German Copyright Act (Gesetz über
Urheberrecht und verwandte Schutzrechte) to acquire rights for the retransmission of radio and television programs that
include, among other things, literary, scientific or artistic work protected by copyright law. In case there is no agreement on
the rights for the retransmission, the retransmission may be prohibited by an injunction. Claims for royalties can exclusively
be asserted by the German collecting societies (Verwertungsgesellschaften) and not by the holders of copyrights or related
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