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PABT IV.
(Ii/i<ni (iIIucIk (I aud hud Ik coiik IIk profH rf // of I In c.r/n III ! in\ The rowilly \\;is tn he paid oji macliiiics llicii ill use. Tlicsc arc called ilic "exhibitors' royalties."
(). The licensee agrees not to sell any mot ionpicture lilni, hut only t(> lease or rent the same to licciKsed cx<'hani;vs and in a('cordance wiili the torins of the exchange license agreement hereafter (U'scrihed. This was a radical dei)arture from the trade custom ; })revionsly manufacturers had sold fihns outright and had not leased them.
7. The licensee agrees not to U^ase or dispose of motion pictures to anyone dealing in motion i)ictures wliicli are not the output of one of the licensees. (Sec. G.)
8. The licensee agrees to mark conspicuously on labels which shall be placed on all boxes containing positive motion pictures the conditions under which the motion pictures are leased, among others that (a) the lessee, i. e., the rental exchange, shall not sell, but shall only have the right to sublet such motion picture; (b) the lessee shall permit such motion pictures to be exhibited only on motionpicture projecting machines licensed by the ]\lotion Picture Patents Co. and on no other machines; (c) the lessee shall not sublet such motion-pictures at a lower subrental price than that agreed upon (if any) in the contract of lease between the lessee and lessor ; (d) a violation of any of the conditions shall entitle the lessor, i. e., the manufacturer, to inunediate possession of the motion-pictures. (Sec. 7.)