AGREEMENT made this day of February 26, 1999, by and between Prelude Development
Inc., (hereinafter referred to as "Company") with its principal offices at 000
Xxxx Xxxxxx Xxxxx, 00xx Xxxxx Xxx Xxxx, Xxx Xxxx 00000 and Xxxxxx Xxxxxx p/k/a
Pretty Black (hereinafter referred as "You') whose current address is 0000
Xxxxxxxxx Xxxxxx, Xxx.#0X, Xxxxx, Xxx Xxxx 00000. In consideration of the
respective covenants contained herein, the parties hereto, intending to legally
bound hereby, agree as follows:
The parties agree as follows:
l. Services.
1.1 During the Term of this agreement, You will render Your services
exclusively to Company throughout the Territory as a performing and recording
artist for the purpose of making Master Recordings for Company.
2. Term Territory.
2.1 The Term shall commence on the date hereof and continue, unless
extended or suspended as provided herein, for an initial Contract Period
(sometimes referred to as the "Initial Period") and the Option Periods provided
for below. The Initial Period shall continue until thc later of; (i) twelve (12)
months after Your Delivery of the last Record in fulfillment of Your Recording
Commitment for such period, but in no event earlier than twelve (12) months
after the date thereof, or (ii) the date upon which Company enters into a
Distribution Agreement.
2.2 If Company enters into a Distribution Agreement with a Distributor
relating to the manufacture and/or distribution of Records made hereunder, the
Term of this agreement shall be deemed modified to be equivalent to the term set
forth under the Distribution Agreement, and the Term hereof shall be deemed to
be coterminous with the term of the Distribution Agreement (including but not
limited to the Distributor's exercise of one (1) or more option periods pursuant
to the Distribution Agreement) plus a period of eighteen (18) months.
2.2.1 If any Distribution Agreement expires or terminates prior to the
date on which it would otherwise expire if all options thereunder were
exercised, then this agreement shall continue for the longer of (i) the
remaining option periods set forth in paragraph 2.3 herein or (ii) for the
term of a succeeding Distribution Agreement.
2.3 If Company has not entered into a Distribution Agreement before the end
of the Initial Period or a Distribution Agreement expires or terminates pursuant
to paragraph 2.2.1 herein, You hereby grant to Company five (5) separate options
to extend the Term for additional Contract Periods (sometimes referred to as
"Option Periods") on the same terms and conditions set forth in paragraph 2.1
except as otherwise provided herein. Each of these options shall be deemed
automatically exercised unless Company notifies You in writing to the contrary
prior to the expiration of the Contract Period then in effect. Accordingly, each
subsequent Option Period shall commence upon the end of the current Contract
Period and end nine (9) months after Delivery of the last Master Recordings
comprising the Recording Commitment for such Option Period. All Masters required
in fulfillment of Your Recording Commitment for the applicable Contract Period
shall be Delivered to Company within three (3) months after the commencement
date of the Contract Period concerned, but in no event shall such Masters be
Delivered earlier than six (6) months after the Delivery of Masters in
satisfaction of the immediately preceding Contract Period. Notwithstanding the
foregoing, Company shall have the option to enter into a Distribution Agreement
during the Term set forth in this paragraph 2.3 and the term of such
Distribution Agreement shall remain subject to paragraphs 2.2 and 2.3.1 herein.
2.3.1 Notwithstanding the foregoing, should You enter into an
agreement with a Distributor:
(i) introduced to You by Company during the Initial Period; or
(ii) with whom You refused to execute an inducement letter
within one year following the termination or expiration of this agreement, then
this agreement shall immediately be deemed in full force and effect as if it had
never terminated, and said Distribution Agreement shall be deemed to have been
entered into during the Term.
2.4 The Initial Period and Contract Periods provided herein and in the
Distribution Agreement are referred to as the "Term".
3. Recording Commitment.
3.1 If Company enters into a Distribution Agreement with a Distributor, You
shall perform for the recording of Master Recordings as required in the
Distribution Agreement.
3.2 If Company is not in contractual privity with a Distributor, You will
perform for the recording of Masters as required herein and You will Deliver to
Company sufficient Masters necessary to satisfy the following schedule.(thc
"Recording Commitment"):
Contract Period Recording Commitment
--------------- --------------------
Initial Period One (1) Single
First Option Period One (1) Single or One (1) Album
Second Option Period One (1) Album
Third Option Period One (1) Album
Fourth Option Period One (1) Album
Fifth Option Period One (1) Album
3.3 At Company's request and after consultation with You, You shall also
perform for the recording of dub mixes, twelve-inch Single mixes, Single edits
and other variation of the Compositions embodied on any Master; and/or the
recording of demonstration recordings ("Demos") as Company shall reasonably
require to secure a Distribution Agreement. The recordings made pursuant to
paragraph 3.3.1 shall not be applied in reduction of Your Recording Commitment
for any Contract Period and You shall not be entitled to additional compensation
for such services provided in connection therewith.
4. Recording Procedure.
4.1 All matters .concerning the recording procedure of Masters herein shall
be determined by Company, including, without limitation; (1) selection of
producer(s); (2) selection of material. including the number of Compositions to
be recorded; and (3) the specification of dates of recording and studios where
recording is to take place, including the cost of recording herein.
4.2 Each Master Recording made hereunder shall bc subject to Company's
approval that such recordings be technically and commercially satisfactory for
the manufacture and sale of Phonograph Records
4.3 No "live" Recording or Recordings will apply in fulfillment of Your
Recording Commitment nor will Company be required to make any payment in
connection with any such Recording, unless Company agrees in writing or such
Recording is actually released by Company. No Composition previously recorded by
You will be recorded under this agreement. No Joint Recording or other recording
not recorded and Delivered in full compliance with the material terms and
conditions of this Agreement will apply in fulfillment of Your Recording
Commitment, nor will Company be required to make any payments in connection with
any such Joint Recording other than royalties due You hereunder, even if such
Joint Recording is actually released by Company.
4.4 Nothing in this agreement shall obligate Company to continue or permit
the continuation of any recording session or project, even if previously
approved hereunder, if Company reasonably anticipates that the Recording Costs
will exceed those specified in the approved budget or that the Recordings being
produced will not be commercially satisfactory.
4.5 No Recordings shall bc made by unauthorized dubbing.
4.6 If for any reason You unreasonably delay thc commencement of or are
unavailable for any recording sessions for the Masters, You shall, upon
Company's demand, pay Company an amount equal to the charges paid or incurred by
Company by reason thereof. Company may, without limiting its other rights or
remedies hereunder, deduct such amounts from monies payable to You hereunder.
5. Advances.
5.1 Company will pay all recording costs approved by an authorized officer
of Company in writing. Such costs shall include, but not be limited to, union
scale, studio, equipment, engineering, instrumental, vocal and other personnel
and arrangements and copying specifically approved by Company in respect of the
recording of such Master Recordings, and all other amounts required to be paid
by Company pursuant to any applicable law, All payments to musicians, arrangers,
sketchers, conductors, orchestrators, producers, contractors and copyists in
connection with the recording of the Master Recordings, and all union scale
payments required to be made to any personnel in connection with the production
of the Master Recordings together with payroll taxes thereon, payments based on
payroll to any labor organization or designee thereof advances and/or fees to
the producer of the Master Recordings (it being understood that no separate fee
or advance shall be payable to You for any producing services in connection with
the Master Recordings unless Company has agreed to such fee or advance in
writing), the cost of cartage and rental of instruments for such recording
sessions, the costs of recording Demos, video Production Costs, studio costs,
transportation costs, hotel and living expenses incurred in connection with the
preparation and attendance of essential personnel at recording sessions,
rehearsal costs, tape, editing and other similar costs in connection with the
production of the final tape waster and the lacquer master, (only to the extent
such mastering costs are charged to Company by its Licensee) and all other costs
generally and customarily recognized as recording costs in the phonograph
industry.
5.1.1 All amounts described in paragraph 5.1 above plus all other
amounts representing direct expenses paid by Company, or incurred, or
charged against advances previously taken in connection with the recording,
mixing and mastering (if charged by Company's Licensees) of Master
Recordings hereunder (including,, without limitation, advances to You,
producers, or other third parties with Your consent unless Company is
obligated to make such payments by Your actions, and all studio and
engineering charges in connection with Company's facilities and personnel
or otherwise) are herein sometimes called "Recording Costs" and shall
constitute Advances. Such Advances shall be recoupable by Company.
5.1.1.1 In determining that portion of the Recording Costs (other
than payments to You) applicable to any Joint Recording which shall be
charged against Your royalties, such portion shall be computed by
multiplying the aggregate amount of such Recording Costs by the same
fraction used in determining the royalties payable to You in respect
of such Joint Recording.
5.1.2 Company, at its expense, shall provide Your reasonable
transportation costs and lodging expenses at a hotel acceptable to Company
if Company deems such accommodations necessary. Such payments shall
constitute advances.
5.2 If Company enters into a Distribution Agreement, and conditioned upon
Your fill and faithful performance of all of the terms and conditions hereof
Company shall pay to You with respect to the exploitation of Masters hereunder
fifty (50%) percent of the Net Advances actually received by Company from thc
Distributor. "Net Advances" as used herein means the gross advances received by
Company from the Distributor less all Recording Costs, Advances, advances
payable to the individual producer(s) of the Masters, video production costs,
tour support payments, legal fees in connection with the acquisition and
maintenance of the Distribution Agreement, payments to third parties in
connection with the exploitation of rights, and any other costs or expenses
incurred by Company in connection with the production, promotion, or
exploitation of the Masters hereunder.
5.3 All monies paid to or on Your behalf during the Term of this agreement,
from other than royalties paid pursuant to Articles 8 and 11 hereof shall
constitute Advances unless otherwise expressly agreed in writing by an
authorized officer of Company.
6. Rights in Recording.
6.1 Each Master Recording made under this agreement, from the inception of
recording, and each Record manufactured therefrom, together with the
performances embodied thereon, shall be the sole property of Company (or if
Company so designates, the Distributor) and will be considered a "work for hire"
(as the term is construed under the Copyright Act of the United States) for
Company and all persons or entities rendering services in connection with each
Master shall be deemed "employees for hire" of Company solely for the purposes
of any applicable copyright law: in the alternative, each Master Recording will
be deemed transferred to Company by this agreement; together with all rights in
it, if it is determined not to be such a work for hire. All such Master
Recordings and all Matrices and Phonograph Records manufactured therefrom,
together with the performances embodied thereon, shall be the sole property of
Company, free from any claims whatsoever by You or any other Person, and Company
shall have thc exclusive right to copyright such Master Recordings in its or any
Distributors or Licensee's name as the owner and author thereof and to secure
any and all renewals and extensions of such copyright throughout the world. You
will execute and Deliver to Company such instruments of transfer and other
documents regarding the rights of Company in the Master Recordings subject to
this agreement as Company may reasonably request to early out the purposes of
this agreement; and Company may sign such documents in Your name and make
appropriate disposition of them.
6.2 Without limiting the generality of the foregoing, Company and any
Person authorized by Company shall have the unlimited and exclusive rights to
manufacture Phonograph Records by any method now or hereafter known, derived
from the Master Recordings made hereunder, and to sell, transfer or otherwise
deal in the same under any trademark, trade names and labels, or to refrain from
such manufacture, sale and dealing, throughout the world.
7. Names and Likenesses: Publicity.
7.1 Company and any Licensee of Company each shall have the exclusive right
and may grant to others the right to reproduce, print, publish, or disseminate
in any medium Your name, or any other professional or assumed name, used by You,
portraits, pictures, likeness, and biographical material concerning You, as news
or information, or for advertising, merchandising and trade purposes with
respect to records hereunder. During the Term of this agreement You shall not
authorize any party other than Company to use Your name or likeness (or any
other assumed or fictitious name used by You) in connection with the advertising
or sale of Phonograph Records, or blank recording tape or recording equipment or
otherwise in respect of Your career as a recording artist.
7.2 Company shall also have the exclusive right to use Your name or picture
as contained in the covers of all Albums recorded hereunder, the artwork on such
covers, and the titles of all such Albums and all Compositions contained on
them, in connection with merchandise other than Phonograph Records ("Album
Merchandising Uses"). If Company receives any payments for such Album
Merchandising Uses, Your royalty account will be credited with fifty percent
(50%) of the net amount of those receipts as computed after deduction of any
direct expenses actually incurred by Company in connection with Album
Merchandising Uses.
7.3 During the Term hereof Company and its Licensees shall maintain the
exclusive, worldwide right to use and to permit others to use Your name (both
legal and professional), logos, photographs, likeness, other identification, and
biographical material concerning You in connection with the sale of T-shirts and
other clothing, posters, stickers, novelties and any other merchandising items.
Company shall credit to Your royalty account a sum equal to fifty percent (5 0%)
of the gross income actually received by Company directly from third party
merchandisers in connection with the exploitation of such merchandising rights
provided that third party commissions or in house merchandising production or
exploitation costs shall be deductible from the aforesaid gross income prior to
the computation of Your fifty percent (50%) share of the remaining gross income.
7.4 Upon Company's reasonable request and upon reasonable notice, You shall
be available to appear for photographs, posters; cover art, to appear for
interviews with representatives of the communications media and publicity
personnel of Company or its Licensees and to perform other reasonable
promotional functions during the Term hereof in connection with the sale and
other exploitation of Records derived from Master Recordings made hereunder. You
shall not be entitled to compensation therefor other than the otherwise
applicable minimum union scale payments set forth in applicable collective
bargaining agreements to which Company is a signatory.
8. Royalties.
If Company enters into a Distribution Agreement, and conditioned upon Your
full and faithful performance of all of the terms and conditions hereof Company
shall pay You royalties on net sales of Records derived solely from the Masters
recorded hereunder, and other exploitations of the Master, as follows:
8.1 Fifty percent (50%) of Company's "Net Royalties" in respect of the
Masters.
8.1.1 "Net Royalties" means all royalties (excluding mechanical
royalties) actually received by Company from the Distributor in the United
States in respect to the exploitation of the Masters pursuant to the
Distribution Agreement less all recording costs, royalties paid to the
individual producers of the Masters and all royalties and payments paid to
third parties in connection with the acquisition or exploitation of rights
in and to the Master Recordings (including, but not limited to, amounts
paid to owners of Master Recordings which have been Sampled or interpolated
in the Master Recordings produced hereunder).
8.2 All royalties payable to You hereunder shall be computed, determined,
calculated and paid in the same manner and on the same basis (e.g. container
charges, free goods, suggested retail list price, reserves, etc) as royalties
are paid to Company by the Distributor pursuant to the Distribution Agreement.
8.3 If You perform for Master Recordings recorded hereunder together with
another artist to whom Company is obligated to pay royalties, Your otherwise
applicable royalty shall be multiplied by a fraction, the numerator of which is
one and the denominator shall be the total number of artists (including
Yourself) who perform an connection with such Master Recordings.
8.4 As to records not consisting entirely of the Masters produced
hereunder, the royalty rate otherwise payable to You hereunder with respect to
sales of any such record shall be prorated by multiplying such royalty rate by a
fraction, the numerator of which is one and the denominator of which is the
total number of masters embodied thereon.
8.5 Notwithstanding anything to the contrary contained in paragraphs 8.1
through 8.4 hereinabove, in the event that Company releases Records recorded
hereunder independently rather than through a Distributor, then in lieu of
royalties to be paid pursuant to paragraphs 8.1 through 8.4, Company shall pay
You royalties computed in accordance with Schedule A (attached hereto).
8.5.1 All royalties payable to You hereunder include all royalties due
Artist, the individual producers and any other Persons on account of the
sate of Records hereunder (other than AF of M or other similar per record
royalties and mechanical royalties).
9. Miscellaneous Royalty Provisions.
Provisions of the Distribution Agreement which relate to all other royalty
computations shall control and be deemed incorporated herein, including, but not
limited to, configuration, territorial and categorical, packaging and
promotional reductions and deductions.
10. Royalty Accountings.
10.1 You will receive copies. of all statements received by Company
covering Your royalties. Said statements will be sent to You, together with any
such royalty due You (if any), within ninety (90) days following the end of each
semi-annual calendar period, provided such monies have become good funds. if
Company has overpaid You, You will promptly reimburse Company, unless Company is
in a position to apply such deficiency to Your royalty account. Company shall
have no liability or responsibility for a breach of timely payment by any of its
Licensees, including Distributor.
10.2 Company will maintain books and records which report the sales of the
Phonograph Records for which royalties arc payable to You. You may, at Your own
expense, examine those books and records and make copies thereof as provided in
this paragraph only. You may make those examinations only for the purpose of
verifying the accuracy of the statements sent to You under paragraph 10.1. You
may make such an examination for a particular statement only once, and only
within twelve (12) months after the date when Company is required to send You
that statement under paragraph 10.1. You may make those examinations only during
Company's usual business hours, and at the place where it keeps the books and
records to be examined. If You wish to make an examination You will be required
to notify Company in writing at least fourteen (14) days before the date when
You plan to begin it. You may appoint a certified public accountant to make such
an examination for You but not if he or his firm has begun an examination of
Company's books and records for any Person except You and has not yet concluded
it. If a certified public accountant performs the examination for You, he will
review his tentative findings with those members of the Company's staff whom
Company designates before he renders a report to You, in order to remedy any
factual errors and clarify any issues which may have resulted from
misunderstandings. Your accountant's report will be completed and a copy of it
will be Delivered to Company within thirty (30) days from the date his
examination ends.
10.3 If You have any objections to a royalty statement with respect to the
sale and/or distribution of records recorded hereunder, You will give Company
specific written notice of that objection and Your reasons for it within twelve
(12) months after the date when Company has rendered that statement to You
pursuant to paragraph 10.1. Each royalty statement will become conclusively
binding on You at the end of that one year period, and You will no longer have
any right to make any other objections to it. You will not have the right to xxx
Company in connection with any royalty accounting, or to xxx Company for
royalties on Records sold during the period a royalty accounting covers, unless
You commence the suit within twelve (12) months or the time provided in
Company's agreement with any Distributor following timely objection made
pursuant to this paragraph.
10.4 You acknowledge that Company's books and records contain confidential
trade information. Neither You, nor Your representative will communicate to
others or use on behalf of any other person any fact or information obtained as
a result of Your examination of Company's books and records.
10.5 You shall not be entitled to examine the books or records of any
Licensee of Company (including Distributor). If Company undertakes an audit of
any Distributor, it will provide You with a copy of the results of such audit as
it pertains to Records produced, manufactured and sold hereunder and under the
Distribution Agreement. In this connection, it will also pay to You Your
proportionate share of the Net Proceeds, if any. "Net Proceeds" shall mean the
gross amount recovered through such audit after deduction of the pro rata costs
incurred thereunder, including without limitation, auditor's and attorney's
fees.
11. Licenses for Musical Compositions.
Controlled Compositions shall be and are hereby licensed to Company:
11.1 For the United States, at a royalty per selection equal to
seventy-five (75%) percent of the minimum statutory per selection rate (without
regard to playing time) effective on the date hereof. The aforesaid seventy-five
(75%) percent per selection rate shall hereinafter sometimes be referred to as
the "U.S. Per Selection Rate", and
11.2 For Canada. at a royalty per selection equal to seventy-five (75%)
percent of the minimum statutory per selection rate (without regard to playing
time effective on the date hereof or if there is no statutory rate in Canada on
the date hereof seventy-five (75%) percent of the per selection rate (without
regard to playing time) generally utilized by major record companies in Canada
on the date hereof. The applicable aforesaid per selection rate shall
hereinafter sometimes be referred to as the "Canadian Per Selection Rate".
11.3 Notwithstanding the foregoing, the maximum aggregate mechanical
royalty rate which Company shall be required to pay in respect of any Single or
LP hereunder, regardless of the total number of compositions contained therein,
shall not exceed two (2) times for any Single and ten (10) times for any LP of
the applicable U.S. Per Selection Rate or Canadian Per Selection Rate,
respectively.
11.4 It is specifically understood that in the event that any Single or LP
contains other compositions in addition to the Controlled Compositions and the
aggregate mechanical royalty rate for said Single or LP shall exceed the
applicable rate provided in this Article 11, the aggregate rate for the
Controlled Compositions contained thereon shall be reduced by the aforesaid
excess over said applicable rate. Additionally, Company shall have the right
with respect to any Single or LP the aggregate mechanical royalty rate for which
exceeds the applicable rate provided in this Article 11, to deduct such excess
payable thereon from any and all monies payable to You pursuant to this or any
other agreement. All mechanical royalties payable hereunder shall be paid on the
basis of net records sold hereunder for which royalties are payable to You
pursuant to this agreement, Company may maintain reserves with respect to
payment of mechanical royalties. If Company makes an overpayment of mechanical
royalties in respect of compositions recorded under this agreement, You will
reimburse Company for same, failing which Company may recoup any such
overpayment from any monies becoming payable to You pursuant to this or any
other agreement. Mechanical royalty payments on records subsequently returned
are considered overpayments.
11.5 In respect of all Controlled Compositions performed in Pictures,
Company is hereby granted an irrevocable perpetual worldwide license to record
and reproduce such Compositions in such Pictures and to distribute and perform
such Pictures including, but not limited to all Videoshows thereof, and to
authorize others to do so. Company will not be required to make any payment in
connection with those uses, and that license shall apply whether or not Company
receives any payment in connection with those Pictures. Simultaneously with Your
submission to Company of the documents and information required herein, You
shall furnish Company with a written acknowledgement from the person(s) or
entity(ies) controlling the copyright in each non-Controlled Composition to be
embodied on any Picture confirming the terms upon which said person(s) or
entity(ies) shall issue licenses in respect thereof. Upon Company's request
therefor, You shall cause said person(s) or entity(ies) to forthwith issue to
Company (and its designees) licenses containing said terms and such other terms
and conditions as Company (or its designees) may require.
11.5.1 If the copyright in any Controlled Composition performed in
Pictures is partially or completely owned or controlled by anyone else, You
will cause that person, firm or corporation to grant Company the same
rights described in this Article 11, on the same terms.
11.6 Notwithstanding anything in the foregoing provisions of this Article
11 to the contrary, if a particular selection recorded hereunder is embodied
more than once on a particular record, Company shall pay mechanical royalties in
connection therewith at the applicable rate for such composition as though the
selection was embodied thereon only once.
11.7 To the extent the Mechanical Royalties provisions of the Distribution
Agreement differ in any respect from the provisions of this Article II, the
provisions in the Distribution Agreement shall control.
12. Warranties; Representations; Restrictions; Indemnities.
12.1 You warrant and represent:
12.1.1 You have the right and power to enter into and fully
perform this agreement.
12.1.2 No Materials, as hereinafter defined, or any use thereof
will violate any law or infringe upon or violate the rights of any
Person. "Materials", as used in this Article, shall include: (1) all
Controlled Compositions, (2) each name used by You in connection with
the Recordings made hereunder, and (3) all other musical, dramatic,
artistic and literary materials, ideas, and other intellectual
properties, furnished or selected by You contained in or used in
connection with the Masters hereunder and/or the recordings made
therefrom or their use in the packaging, sale, distribution,
advertising, publicizing or other exploitation thereof.
12.1.3 You are or will become and will remain to the extent
necessary to enable the performance of this agreement, a member in
good standing of all labor unions or guilds, membership in which may
be lawfully required for the performance of Your services hereunder.
12.2 During the Term of this agreement, You will not enter into any
agreement which would interfere with the full and prompt performance of Your
material obligations hereunder, and You will not perform or render any services
for the purpose of making Phonograph Records or Master Recordings derived from
Your performances for any Person other than Company. After the expiration of the
Term of this agreement, for any reason whatsoever, You will not perform any
Composition which shall have been recorded hereunder for any Person other than
Company for the purpose of making Phonograph Records or Master Recordings prior
to whichever of the following dates shall bc later: (a) the date five (5) years
subsequent to the date such Composition is recorded hereunder, or (b) the date
two (2) years subsequent to the expiration date of the Term of this agreement,
You shall not authorize or consent to Your performances to be recorded in
violation of the foregoing restrictions.
12.3 If You shall become aware of any unauthorized recording, manufacture,
distribution or sale by any third party contrary to the foregoing re-recording
restrictions, You shall notify Company thereof and shall cooperate with Company
in the event that Company commences any action or proceeding against such third
party.
12.4 Your services are unique and extraordinary, and the loss thereof
cannot be adequately compensated in damages, and Company shall be entitled to
injunctive relief to enforce the provisions of this agreement.
12.5 You shall at all times indemnify and hold harmless Company (and any
Licensee of Company) from and against any and all claims, damages, losses,
liabilities, costs and expenses, including legal expenses and reasonable counsel
fees, arising Out of any claim which is inconsistent with or any alleged breach
or breach by You of any warranty, representation or agreement made by You
herein. You shall reimburse Company (and/or Company's Licensees) on Company's
demand for any payment made or incurred at any time after the date hereof with
respect to any liability or claim to which the foregoing indemnity applies.
Company shall give You notice of any claim to which the foregoing indemnity
applies. You will have the right to participate in the defense of any such claim
with counsel of Your own choice and at Your own expense. Pending the
determination of any claim, demand or action involving such breach or alleged
breach of warranty, Company may, at its election, withhold payment of any sums
otherwise payable to You hereunder in an amount equal to Your potential
liability to Company.
12.6 Company shall not be required to make any payments of any nature for,
or in connection with the acquisition, exercise or exploitation of rights by
Company pursuant to this agreement. except as specifically provided in this
agreement.
l2.7 There are no prior recorded masters embodying Your performances
unreleased within thc United States of America and elsewhere in the world. If
there are any such recorded masters embodying Your performances, owned or
controlled by You or any entity owned or controlled by You, neither You nor such
entity shall release, or authorize the releases of any such recorded performance
on phonograph records prior to the date two (2) years after the expiration or
termination of the Term hereof.
12.8 All of Your representations and warranties shall be true and correct
upon execution hereof and upon Delivery of each Master Recording hereunder, and
shall remain in effect in perpetuity. Company's acceptance of Master Recordings
or other materials hereunder shall not constitute a waiver of any of Your
representations, warranties or agreements in respect thereof.
12.9 During the Term should You render any musical performance, audio,
visual or otherwise, for the purpose of making any motion picture or other audio
visual work (the "Picture") for any person other than Company You shall not
authorize any such other person to make any records therefrom without in every
instance obtaining Company's prior written consent thereto. You shall notify
Company of all such audio visual undertakings as a matter of a courtesy and,
should any record embodying Your performances result therefrom without Company's
written consent, You shall cooperate fully with Company with respect .to the
prosecution of such unauthorized recording.
12.10 You shall execute and Deliver to Company, upon Company's request
therefore, a form of artist inducement letter as may be required by the
Distributor.
l3. Sampling.
13.1 You shall not embody any Sampled Material any Master hereunder without
Company's prior written consent. Your failure to obtain Company's written
consent prior to embodying any Sampled Material on a Master shall constitute a
material breach of this agreement and, without limitation of any of Company's
other rights and remedies, in such event You shall repay Company on demand for
any monies theretofore advanced by Company to You for such Master.
13.2 If Company does consent to the inclusion of Sampled Material on a
particular Master, then the following shall be applicable:
13.2.1 You shall at Your expense or otherwise as Company may agree in
writing, obtain for Company's benefit and shall Deliver to Company not
later than simultaneously with the Delivery of any applicable Master(s),
all written licenses and permissions from the owner(s) of any such Sampled
Material which are necessary for Company's use of such Sampled Material,
including, without limitation, all licenses and permissions from the
publisher of the applicable composition(s) so sampled, upon terms and
conditions acceptable to Company.
13.2.2 Delivery to Company of an applicable Master shall not be deemed
completed unless and until all written licenses and permissions from the
owners of such Sampled Material are Delivered to Company in accordance with
the foregoing provisions.
13.2.3 Your obligation to obtain all such licenses and permissions
from the owner(s) of any such Sampled Material is an essential obligation
on Your part hereunder, and Your failure to obtain any such license(s) and
permission(s) shall constitute a material breach of this agreement.
14. Definitions.
14.1 "Master Recording(s)" or "Master(s)" Every recording of sound, whether
or not coupled with a visual image by any method and on any substance or
material, whether now known or hereafter devised, which is used or useful in the
recording, production and/or manufacture of phonograph records (including, but
not limited to Demos recorded hereunder).
14.2 "Person" and "Party" Any individual, corporation, partnership,
association or other organized group of persons or legal successors or
representatives of the foregoing.
14.3 "Record(s)" "Recording(s)" and "Phonograph Record(s)" All forms of
reproductions, now or hereafter known, manufactured or distributed primarily for
home use, school use, juke box use, or use in means of transportation, embodying
(a) sound alone or (b) sound coupled with visual images, e.g., "sight and sound"
devices.
14.4 "Album" or "LP" One or more Records containing at least thirty-five
(35) minutes in playing time, sold in a single package, whether or not released,
which are recorded in connection with a specific album project, but not
including Sides which were recorded in connection with any other album project.
14.5 "Single" A Record containing not more than two (2) Sides. 14.6 "Side"
A Recording of sufficient playing time to constitute the equivalent of one side
of a 45 rpm record, but not less than two and one-quarter minutes of continuous
sound.
14.7 "Long Play Single" A Record embodying not more than three (3) Sides,
including but not limited to a 33-1/3 rpm disc record.
14.8 "EP" A Record embodying not more than five (5) to six (6) Sides which
does not exceed a total playing time of 35 minutes.
14.9 "Maxi single" A Record embodying not more than four (4) Sides.
14.10 "Advance" A prepayment of royalties which sums shall be recoupable by
Company from any and all amounts to be paid to or on behalf of You pursuant to
this or any other agreement between You and Company.
14.11 "Composition" A single musical composition, irrespective of length,
including all spoken words and bridging passages.
14.12 "Controlled Composition" A Composition embodied in a Master Recording
recorded or released hereunder, which Composition: (i) is written or composed,
in whole or in part, directly or indirectly, by You, by any individual producer
that produces Master Recordings hereunder or by any Person in which You have a
direct or indirect interest; and/or (ii) is owned or controlled, in whole or in
part, directly or indirectly by You, by any individual producer that produces
Master Recordings hereunder or by any Person in which You have a direct or
indirect interest.
14.13 "Delivered" or "Delivery" Means the receipt and acceptance of by
Company and/or its Licensees, the tape master and reference discs as well as the
submission by You in a written form of all necessary information, consents,
licenses and permissions such that the Company and/or its Licensees may
manufacture, distribute and release the Records concerned including, without
limitation, all label copy, publishing and songwriting information (including
applicable music performance rights organizations), Album credits, the timings
for each Composition contained on a Record, ancillary materials prepared by or
for You which are required hereunder, first use mechanical licenses, sideperson
permissions and any information required to be delivered to unions, guilds or
other third parties.
14.14 "Licensees" Any licensee of Company, including, without limitation,
any Distributor or its licensees.
14.15 "Distributor" A third Party record company which has the right to
distribute Records derived from the Master Recordings pursuant to a Distribution
Agreement.
14.16 "Distribution Agreement" An agreement pursuant to which Company
grants to a Distributor the right to distribute through normal retail channels
Records derived from the Master Recordings recorded hereunder.
14.17 "Joint Recording" Any Master Recording embodying Your performance,
together with the performance of another artist(s) with respect to which Company
is obligated to pay royalties.
14.18 "Contract Period" The Initial Period, or any Option Period exercised
hereunder (as those periods may be extended or suspended as provided herein).
14.19 "Picture" Motion pictures or other audiovisual works that have a
soundtrack substantially featuring performances of Artist.
14.20 "Videoshows" Videocassettes, videodiscs or any other devices, now or
hereafter known or developed, that enable the Picture to be perceived visually,
with or without sound, when used in combination with or as part of a piece of
electronic, mechanical or other apparatus.
14.21 "Sampled Material", "Sample" any portion of a sound recording which
is owned or controlled by a party other than You.
14.22 "Territory" the Universe.
14.23 If any one or more definitions herein conflict with the definitions
set forth in the Distribution Agreement, the definitions set forth in the
Distribution Agreement shall control.
15. Remedies.
15.1 If You do not fulfill any portion of Your Recording Commitment within
the time prescribed herein or pursuant to the Distribution Agreement or Your
voice or ability to perform becomes impaired, or if You fail, refuse, neglect or
are unable to comply with any of Your obligations hereunder, Company will have
the following options in addition to any rights or remedies Company may have:
15.1.1 to extend the then current Contract Period of the Term for the
period of such default plus such additional time as is necessary so that
Company shall have no less than one hundred fifty (150) days after
completion of Your recording commitment or the fulfillment of any other
material obligation within which to exercise its option, if any, for the
next following Contract Period. Company's obligations hereunder shall be
suspended for the duration of any such default; and/or
15.1.2 to terminate the Term of this agreement at any time.
15.2 Company may exercise each of these options by sending You the
appropriate notice. No exercise of either option under this paragraph will limit
Company's rights to recover damages by reason of Your default, or any of its
other rights.
l6. Force Majeure.
If because of an act of God, inevitable accident, fire, lockout, strike or
other labor dispute, riot or civil commotion, act of public enemy, enactment,
rule, order or act of any government or governmental instrumentality (whether
federal, state, local or foreign), failure of technical facilities, failure or
delay of transportation facilities, illness or incapacity of any performer or
producer, or other cause of similar or different nature not reasonably within
Company's control, Company is materially hampered in the recording, manufacture,
distribution or sale of records, then, without limiting Company's rights,
Company shall have the option by giving You notice to suspend the then current
Contract Period for the duration of any such contingency plus such additional
time as is necessary so that Company shall have no less then ninety (90) days
after the cessation of such contingency in which to exercise its option, if any,
for the next following Option Period. No suspension shall exceed six (6) months
unless the phonograph record industry in general is affected.
17. Agreements. Approval & Consent.
17.1 As to all matters treated herein to be determined by mutual agreement,
or as to which Your approval or consent is required, such agreement, approval or
consent will not be unreasonably withheld.
17.2 Your agreement, approval or consent, whenever required shall be deemed
to have been given unless notification is given within five (5) days following
the date of written request therefor.
18. Notices.
Except as otherwise specifically provided herein, all notices hereunder
shall be in writing and shall be given by personal delivery, registered or
certified mail, return receipt requested, at the addresses shown above, or such
other address or addresses as may be designated by either Party. Notices shall
be deemed given when personally delivered or mailed, except that notice of
change of address shall be effective only from the date of its receipt. Courtesy
copies of all notices to Company shall be simultaneously sent to Sander &
Xxxxxxxxx LLP, 000 Xxxx Xxxxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
19. Assignment.
Company may assign this agreement to its Licensees or to any third party,
or to any subsidiary, affiliated or controlling corporation or to any person
owning or acquiring a substantial portion of the stock or assets of Company.
Company may also assign its rights hereunder to any of its Licensees to the
extent necessary or advisable in Company's sole discretion to implement the
license granted. You may not assign this agreement or any of Your rights
hereunder and any such purported assignment shall be void ab initio.
20. Publishing.
20.1 You hereby irrevocably and absolutely assign, convey and set over to
Company, or Company's designee ("Publisher") an undivided fifty percent (50%)
interest in each Controlled Composition pursuant to an agreement in thc form of
Exhibit A appended hereto.
20.2 If the copyright in any Controlled Compositions is owned or controlled
by anyone else, You will cause that Person to grant Company the same rights
described in this paragraph 21 on the same terms. If the copyright in any
Controlled Composition is transferred, the transfer will be made subject to this
agreement.
21. Video.
21.1 You shall upon Company's reasonable request appear on dates and at
film studios and other locations designated by Company upon reasonable notice to
You for the filming, taping or other permanent fixation of audio visual
reproductions of the Compositions contained in the Masters in Videoshows on the
following terms and conditions:
21.2 Company, after consultation with You, shall designate the
Composition(s) to be used, the producer and director thereof, all production
personnel rendering services in connection with the production of the
Videoshows, the storyboard and script and the locations and dates of filming;
21.3 Company will pay the Production Costs (as hereinafter defined)
incurred in connection with any Videoshows in an amount not in excess of a
written budget to be determined by us in writing. Fifty (50%) percent of
Production Costs shall be recoupable from royalties accruing to Your royalties
from sound only recordings and One Hundred (100)% of Production Costs shall be
recoupable from royalties or other sums payable with respect to audiovisual
recordings;
21.4 With respect to any Controlled Composition, You hereby grant us (A)
free, worldwide perpetual licenses for the inclusion and exploitation of all
Controlled Composition in Videoshows for "advertising and promotional purposes",
as determined by Company; and (B) for audiovisual records, perpetual licenses
for the United States and Canada (as applicable) at the mechanical royalty rates
specified for sound-only records in paragraph 11 above. With respect to all
other uses, You shall use your best efforts to negotiate on our behalf rates
which are no less favorable than those granted to Company by other third party
non-affiliated publishers.
21.5 As used in this paragraph 22, "Production Costs" shall mean all direct
costs incurred in the production (pre, during, and post) of Videoshows through
the final master tape, video or film, including, without limitation, all sums
paid to or for production companies, directors, writers, and all so called
"above the line" and "below the line" talent and crew (including without
limitation associate producers, technical crews, camerapeople, maintenance
engineers, audio crew members and equipment, lighting crews) and all production
fees and costs (including without limitation location and police permits and
fees, hall and studio rental and cartage and equipment) and all other costs and
expenses which are now or hereafter generally recognized in the United States
record and film industry as production costs of audiovisual programs.
22. Miscellaneous.
22.1 You understand and acknowledge that the sale of Records is speculative
and agree that the judgment of Company with regard to any matter affecting the
sale, distribution and exploitation of Records hereunder shall be binding and
conclusive upon You. Nothing contained in this agreement shall obligate Company
to make, sell, license, or distribute Records manufactured from the Masters
recorded hereunder other than as specifically provided herein. The method,
manner and extent of release, packaging, promotion, advertising, distribution
and exploitation of Master Recordings and Records shall be within the sole
discretion of Company unless otherwise herein specifically provided.
22.2 This agreement contains the entire understanding of the Parties hereto
relating to the subject matter hereof and cannot be changed or terminated except
by an instrument signed by an officer of Company. A waiver by Company of any
term or condition of this agreement in any instance shall not be deemed or
construed as a waiver of such term or condition for the future, or of any
subsequent breach thereof. All remedies, rights, undertakings, obligations and
agreements contained in this agreement shall be cumulative and none of them
shall be in limitation of another remedy, right, undertaking, obligation or
agreement of Company.
22.3 If any part of this agreement shall be determined to be invalid or
unenforceable by a court of competent jurisdiction or any other legally
constituted body having jurisdiction to make such determination, the remainder
of this agreement shall remain in full force and effect.
22.4 Those provisions of any applicable collective bargain agreement
between Company and any labor organization which are required, by the term of
such agreement, to be included in this agreement shall be deemed incorporated
herein.
22.5 Each option and/or election granted to Company hereunder including,
without limitation, to suspend the running of one or more periods of time
specified in this agreement, to terminate the Term of this agreement, or
otherwise, is separate and distinct, and the exercise of any such option or
election shall not operate as a waiver of any other option or election unless
specifically so stated by Company in its notice of exercise of such option or
election.
22.6 You shall not be entitled to recover damages or to terminate the Term
of this agreement by reason of any breach by Company of its material obligations
hereunder, unless Company has failed to remedy such breach within ninety (90)
days following receipt of Your written notice thereof, or if such breach is not
reasonably capable of being cured within such ninety (90) day period, Company
does not commence to cure such breach in said ninety (90) day period or complete
the curing of such breach thereafter.
22.7 Any process in any such action or proceeding may, among other methods,
be served upon You by delivering it or mailing it by registered or certified
mail, directed to the address first above written or such other address as You
may designate in writing. Any such delivery or mail service shall be deemed to
have the same force and effect as personal service within the State of New York.
Delivery shall be deemed made when mailed.
22.8 This agreement has been entered into the State of New York, and the
validity, interpretation and legal effect of this agreement shall be governed by
the laws of the State of New York applicable to contracts entered into and
performed entirely within the State of New York. The federal and state courts of
the State, City and County of New York only will have jurisdiction and venue of
any controversies regarding this agreement; and any action or other proceeding
which involves such a controversy will be brought in the courts located within
the State, City and County of New York and not elsewhere.
22.9 In entering into this agreement, and providing services pursuant
hereto, You shall have the status of independent contractor and nothing herein
contained shall contemplate or constitute You as Company's agent or employee.
22 10 This agreement shall not become effective until executed by all
Parties hereto.
22.11 You acknowledge that Company has recommended that You have this
agreement reviewed on Your behalf by an attorney experienced in the music
industry.
IN WITNESS WHEREOF the parties have executed this agreement as of the date
first hereinabove written.
Prelude Development Inc.
By: /s/
Authorized Officer
/s/ Xxxxxx Xxxxxx
Xxxxxx Xxxxxx p/k/a/ "Pretty Black"
SSN: ###-##-####
