0000X Xxxxx Xx.
Xxxxx Xxxxx Xxxxxxx, XX X0X 0X0
250.862.2524
Fax. 000.000.0000
xxx.xxxxxxxxxx.xxx
Digital Music Distribution Services Agreement (Rev 7/3/90)
1. Nature of Agreement. This Digital Music Distribution Services Agreement
("Agreement") and the attached Exhibit(s) is entered between the entity or
individual indicated below under "Customer" and Xxxxxxxxxx.xxx Inc. ("Angel
Audio"), a corporation with offices at 0000X Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
Xxxxxxxx X0X 0X0 and describes the terms and conditions to which Angel Audio
shall perform digital music distribution services for Customer.
2. Reporting and Payments. Within thirty days of the end of each calendar
quarter, Angel Audio shall provide Customer with a written statement detailing
the songs distributed and remit Customer's portion of the proceeds collected
from the sales of Customer's music, net of Angel Audio's distribution fees and
customer refunds or returns. For digital download sales processed directly by
Angel Audio, Angel Audio shall deduct from such proceeds third party payment
processing fees such as VISA, Mastercard, Diners Card, other credit card or
calling card payment mechanism.
3. Licensed Sound Recordings. The music licensed under this agreement is the
entire library of songs currently owned by Customer and are described in Exhibit
"A," attached (the "Song Recordings").
4. Customer's Obligations. Customer shall deliver, at its own cost all of the
Sound Recordings in MP3 format, to Angelaudio no later than one week after
signing this Agreement. Customer represents and warrants on a continuing basis:
(a) that it owns or has secured all necessary rights to reproduce, distribute,
transmit, sell, or otherwise exploit the Sound Recordings sound recordings and
materials provided by Customer hereunder; (b) that it owns or has secured all
rights necessary to allow Angel Audio to perform the services and exercise its
other rights and obligations hereunder without Angel Audio paying or having an
obligation to pay any royalties, compulsory licenses or other amounts,
including, without limitation: (i) performance and mechanical royalties, and
(ii) digital audio transmission royalties, whether for subscription or
nonsubscription transmissions or otherwise; (c) that it will comply with any
obligations it may have under third party mechanical rights, performance rights
(for audio streamed from Customer's own website, for example) and distribution
agreements; and that the sound recordings, music, and other audio content and
materials provided by Customer hereunder do not violate or infringe any right of
privacy or publicity, or contain any libelous, defamatory, obscene or unlawful
material, or otherwise violate or infringe any other right of any person or
entity. Customer must notify Angel Audio in writing of any restrictions that may
apply to the distribution, sales or promotions of Customer's encoded music,
sound recordings, and other audio content, including any geographical
restrictions. Customer shall also ensure that copyright information and other
metadata included in Customer's encoded music, sound recordings, and other audio
content and materials is accurate. Angel Audio reserves the right to report
mechanical and performance rights information to agencies that the Customer is
under contract with, or to any person, firm, corporation or other entity with
which Angel Audio has a contract relating to such reports. Such right however,
does not relieve any existing contractual reporting or financial obligations the
Customer may directly have with such rights agencies or other third parties. If
and to the extent that Angel Audio pays or is obligated to pay any mechanical,
performance, digital audio transmission, or similar royalties with respect to
any musical composition embodied in master recordings, sound recording, or any
other music, audio content, or materials that are the subject of this Agreement,
then, at Angel Audio's option: (i) Customer shall reimburse Angel Audio for any
such amounts paid by Angel Audio; (ii) Customer shall pay such amounts directly;
or (iii) Angel Audio may deduct any such payments from proceeds otherwise
payable to Customer hereunder. Angel Audio reserves the right to suspend or
terminate services immediately if Angel Audio has reasonable grounds to believe
that Customer is utilizing services illegally or is in violation of any
agreement with Angel Audio
5. Digital Distribution. In connection with Angel Audio's exercise of its rights
and obligations hereunder, Customer grants Angel Audio the
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non-exclusive, royalty-free rights to: (a) perform the publicly by means of
digital audio transmission; (b) distribute the Sound Recordings and other
materials provided by Customer; and (c) otherwise make such items available as
specified herein. The foregoing license shall include but shall not be limited
to, the right to provide and transmit such music and other content through web
sites, in-store kiosks, portable music players mobile phones, personal digital
assistants, wireless applications and other Internet enabled devices. Customer
shall retain the selection and termination rights set forth above. Any retailer
to whom Angel Audio makes Customer's content available shall have the right to
include or exclude such content from such retailer's inventory, and retailers
shall have the right to market, advertise, promote and establish retail prices
and any discounts for Customer's encoded music and audio content.
6. Compilation CD sales. Angel Audio shall also have the right to distribute CDs
composed of the Sound Recordings, in a CD containing a selection of songs
predetermined by Customer or as a customized compilation, or as a compilation of
songs chosen by Angel Audio. Customer grants Angel Audio all mechanical rights,
synchronization rights and other rights necessary for Angel Audio to make
available for sale, produce and distribute CDs with a selection of songs
predetermined by Customer, customized compilation CDs, and other compilation CDs
containing the Sound Recordings. Customer grants Angel Audio the rights to
synchronize the Sound Recordings with any other materials in any combination in
order to promote the sale of the Sound Recordings.
7. Distribution Fees. Angelaudio shall choose the price to download the Sound
Recordings. For digital distribution, Angel Audio shall deduct affiliate fees
(affiliate fees are fees paid to arms-length affiliates for customer referrals
and in no case shall be more than 12% of the retail price), third party credit
card processing charges, such as VISA, Mastercard, American Express, Diners
Card, other credit cards, and calling card payment mechanisms, coupons, and a US
$0.20 server/e-commerce charge from each single download, and an additional US
$0.15 fee for each song where a hard copy CD is ordered and the remainder of the
purchase price shall be divided with 70% to Angelaudio and 30% to the Customer.
8. Promotional & Test Trials. Customer acknowledges that from time to time new
users on Angelaudio will be given promotional credits or coupons. Specifically,
Angelaudio will be allowing purchasers a free $5 credit for their first
purchase. In no event shall Angel Audio be liable to Customer for Sound
Recordings that are distributed through Angel Audio as part of this or any other
promotion or test trial where no payment is received by Angel Audio.
9. Subscription Services. Angelaudio intends to include the Sound Recordings as
part of genre based subscription services Angelaudio intends to offer to its
Internet consumers. Angelaudio agrees that any songs for which Customer must pay
mechanical royalties, those songs will be divided into 6 sets and will be
released to subscribers one set a month on a 6 month cycle. In order to
calculate revenues where Consumer's Sound Recordings are included with music
from other companies, the total revenues from a particular genre will be
calculated and divided according to the prorated share of downloads from
Consumer's Sound Recordings.
10. Minimum Guarantee. Angelaudio guarantees that Customer shall receive a
minimum of US $7,500.00 for its share of the revenues from exploitation of the
Sound Recordings, according to the following schedule:
a) $5,500 on signing of this agreement
b) $2,000 within one week after all of the Sound Recordings have been
delivered to Angelaudio.
11. Term of Agreement. This Agreement is a non-exclusive agreement. The initial
term of this Agreement is three years. Either party may terminate this Agreement
due to breach if such breach is not cured within thirty days of receipt of
written notification. Upon termination of this Agreement, Angel Audio shall
return physical CDs and other materials used for encoding Customer's encoded
music to Customer and disable all public links to Customer's encoded music.
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12. Limitation of Liability and Disclaimer. IN NO EVENT SHALL ANGEL AUDIO BE
LIABLE FOR ANY LOSS OF DATA, LOSS OF PROFITS, COST OF COVER OR OTHER SPECIAL,
INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES ARISING FROM OR IN RELATION TO
THIS AGREEMENT OR THE USE OF THE SERVICES, HOWEVER CAUSED AND REGARDLESS OF
THEORY OF LIABILITY. ANGEL AUDIO SPECIFICALLY DISCLAIMS ALL WARRANTIES EXPRESSED
OR IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT OF THE
SYSTEM OR SERVICES PROVIDED BY ANGEL AUDIO HEREUNDER. Customer shall indemnify,
defend, and hold Angel Audio harmless from and against any and all claims,
demands, suits, objections, actions and causes of action arising out of any
breach by Customer of this Agreement, or any it the representations, warranties,
indemnities, covenants or undertakings made by Customer hereunder.
13. Miscellaneous. This Agreement constitutes the entire agreement between the
parties on the subject matter hereof. No amendment or modification hereof will
be valid or binding upon the parties unless made in writing and signed by the
duly authorized representatives of both parties. The relationship of the parties
hereunder is that of independent contractors, and this Agreement will not be
construed to imply that either party is the agent, employee, or joint venturer
of the other. In the event that any provision of this Agreement is held to be
unenforceable, this Agreement will continue in full force and effect without
said provision and will be interpreted to reflect the original intent of the
parties. This agreement shall be interpreted under the laws of the State of
Nevada. This Agreement will be binding upon and will inure to the benefit of the
parties permitted successors and/or assignees. Waiver by either party of a
breach of any provision of this Agreement or the failure by either party to
exercise any right hereunder will not operate or be construed as a waiver of any
subsequent breach of that right or as a waiver of any other right. Except for
the payment of fees hereunder, nonperformance of either party will be excused to
the extent that performance is rendered impossible by strike, fire, flood,
earthquake, power outages, network failure, governmental acts or orders or
restrictions, or any other reason when failure to perform is beyond the
reasonable control of the nonperforming party.
Customer Acceptance. Customer has read and agrees to the terms and conditions of
this Agreement and Exhibit(s).
CUSTOMER:
x /s/ Xxxxxx Large
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Signature
Xxxxxx Large 8/11/2000
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Printed Name Date
President
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Title
Parkers Lake Media
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Company
Xxxxxxxxxx.xxx Inc.:
x /s/ Xxxxx Xxxxx
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Signture / Authorized Signer
Xxxxx Xxxxx Aug. 11, 2000
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Printed Name Date
VP, Business Development
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Title
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