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30 Circulars to Film Rental Exchanges.
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 Company has licensed the American Mutoscope & Biograph Company 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 have flagrantly violated their agreements, will be invited to sign the new agreement with the Patents Company, as will the exchanges now operated by the Kleine Optical Company, and a very few of the more substantial independent exchanges.
The new agreement will be found not to materially alter the present system of handling licensed film, the principal change being that no licensed motion pictures will be permitted to be used on any projecting machine which is not licensed by the Patents Company under its patents. All projecting machines now in use will be licensed by February 1, 1909, upon the payment of a nominal fee. The Patents Company has licensed all of the present manufacturers of projecting machines of any importance, and the machines sold by these manufacturers after February 1st, will bear patent plates setting forth the conditions under which these machines shall be used, these conditions being the same as will be applied to the machines now in use. Each exhibitor will be required to pay a royalty after February 1st. The total royalty for the period from February 1st to March 8th, will be $10 for each exhibitor, but it is the intention to equalize this fee as soon as practicable, so that small exhibitors will not be required to pay so much, and the large exhibitors more, the average being maintained as nearly as practicable at $2 per week. Each exhibitor must make application for a machine license on a form to be furnished by the Patents Company and the application must be accompanied by the