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220
PAET IX.
quired, the ownership of the Edison, Biograph, Armat, and Vitagraph patents, which, we are assured by counsel, cover all modern moving-picture films and all existing commercial t}^es of projecting machines. The Patents Co. proposes to control the business in such a way that the honest and legitimate exchange, whether a member of the F. S. A. or not, shall be protected from the unfair and ruinous competition of the dishonest exchange. This can only be done by insisting that all exchanges who may desire protection under the above patents shall conform rigidh^ to the fair and reasonable rules which the company has formulated and which are embodied in a proposed license agreement herewith submitted for your consideration.
In addition to the licensed manufacturers whose films licensed exchanges have heretofore been permitted to handle, the Motion Picture Patents Co. has licensed the American Mutoscope & Biograph Co. of New York City, which has a present output of two reels a week, and Mr. George Kleine, of Chicago, who will have a weekly output of two reels of Gaumont film and one reel of Urban Eclipse film, and the product of these two new licenses will be available to licensed exchanges after January 11, 1909.
All of the present licensed exchanges, except a few whose credit is very bad or who luwe flagrantly violated their agre(^ments, will be invited to sign the new agreement with the Patents Co., as will the exchanges now operated by the Kleine Optical Co. and a v(M*y f(^w of the more substantial independent exchanges.