Exclusive Recording Artist Agreement
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This Agreement is made as of the 25th day of October, 2000 by and
between PARALLAX ENTERTAINMENT, INC. (hereinafter "Parallax") and Xxxxxx
Xxxxxxxx, Xxxx Xxxxxx, and Xxxx Xxx Xxxxx, both individually and jointly, and
p/k/a "Track 10" or "Track Ten" (hereinafter "Artist").
1. ARTIST'S WARRANTIES AND REPRESENTATIONS
1.01. Artist represents and warrants that: (a) it is authorized,
empowered and able to enter into and fully perform its obligations under this
Agreement; (b) neither this Agreement nor the fulfillment thereof by any party
infringes upon the rights of any other person or entity; (c) it has not and will
not do anything that impairs Parallax's rights under this Agreement, nor will it
permit any other person or entity to do so; and (d) Artist is resident in the
United States of America for income tax purposes.
1.02. Artist further represents and warrants that: (a) there now exist
no prior recorded performances by Artist other than those listed on the attached
Exhibit A; (b) that it owns all of the rights in and to the Masters listed on
Exhibit A and that no recordings from those Masters will be released during the
term hereof; (c) none of the Masters delivered to Parallax by Artist, nor the
performances embodied thereon, nor any other Materials, nor any use thereof by
Parallax or its grantees, licensees or assigns, will violate or infringe upon
the rights of any third party. "Materials," as used in this Paragraph, means all
Controlled Compositions, each name used by Artist, any logo used by Artist, and
all other musical, artistic, literary and other materials, ideas and other
intellectual properties furnished by Artist or any other producer engaged by
Artist and contained or used in connection with any Masters made hereunder, or
the packaging, sale, advertising or other exploitation thereof.
2. TERM AND RECORDING COMMITMENT
2.01. The Term of this Agreement shall be for an Initial Period
commencing on the date hereof and expiring nine months thereafter.
2.02. Artist hereby grants to Parallax three (3) separate and
irrevocable options to extend the Term of this Agreement for further periods
(the "Option Periods") commencing immediately upon the expiration of the Initial
Period and expiring one year after delivery to Parallax of the Minimum Recording
Commitment for said Option Period. Each option shall be exercised by written
notice from Parallax to Artist postmarked or delivered before upon the
expiration of the prior term; provided that, Parallax shall have a thirty day
right to cure any inadvertent failure to exercise such option.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 1
2.03. During the Term of this Agreement (as the same may be extended)
Artist agrees to produce and Artist shall deliver to Parallax Masters comprising
sound alone sufficient to comprise the following (the "Minimum Recording
Commitment"):
(a) during the Initial Period-- one (1) Album (the "First Album")
(b) during the First Option Period--one (1) Album (the "Second Album")
(c) during the Second Option Period--one (1) Album (the "Third Album")
(d) during the Third Option Period--one (1) Album (the "Fourth Album")
2.04. Notwithstanding anything else herein to the contrary:
(a) Each Album shall be delivered to Parallax within four (4) months after
the commencement of the applicable Initial Period or Option Period. The Album
currently being recorded by the Artist shall, when delivered, count as the
Minimum Recording Commitment for the Initial Period.
(b) Artist shall not commence the recording of any Album hereunder earlier
than three (3) months following delivery to Parallax of the prior album.
(c) Parallax shall not be obliged to accept delivery of any Album hereunder
earlier than one year following the date of delivery to Parallax of the prior
album. If any such premature delivery is tendered, the contractual date of
delivery hereunder of such Album shall be deemed to be the date one year
following the date of delivery of the prior album, provided that the prior album
has been recorded and delivered in all respects in accordance with the
provisions of this Agreement and comprises acceptable Masters as herein
provided.
(d) In the event that, during the Initial Period or the Option Periods,
Artist produces more than the Minimum Recording Commitment, Parallax shall at
its sole option be entitled to treat such additional material (or some of it) as
counting towards the Minimum Recording Commitment (or not) but said additional
material shall be and remain the sole and exclusive property of Parallax subject
to the provisions of this Agreement.
(e) Each Album delivered shall consist of not less than ten (10) Masters
and not less than forty-five (45) nor more than seventy-four (74) minutes of
Artist's performances. Each Master shall consist of not less than two minutes
and thirty seconds of Artist's performances. No album consisting of Artist's
"live" performances shall be deemed to be in fulfillment of any of Artist's
obligations hereunder except that upon mutual consent, in writing, a live
recording may be accepted in fulfillment of Artist's Minimum Recording
Commitment. If any such performances are recorded during the Term hereof,
Parallax shall be the owner thereof and shall have the right to exploit same
under the same terms as contained herein for the First Album, except that no
advance will be paid to Artist.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 2
No Multiple Albums shall be delivered hereunder without Parallax's prior written
consent; any such Multiple Album delivered to and accepted by Parallax shall be
deemed a single Album for all purposes hereof. No Mini-Album shall form part of
the Minimum Recording Commitment unless expressly agreed in writing by Parallax
at its absolute discretion.
(f) Artist shall deliver to Parallax each Master hereunder in the form of a
digital twotrack stereo tape master, as well as reference discs which are
representative of such tape masters. Artist shall also deliver at the same time
any multi-track master tapes recorded in connection with the same project. The
two-track stereo master tape shall be fully edited, mixed, equalized and
leadered for the production of parts from which satisfactory Phonograph Records
can be manufactured.
(g) As used in this Agreement, "delivery" shall mean the receipt of all
tape masters as provided herein, as well as Artist's submission to Parallax in
written form of all necessary information, consents, licenses and permissions
that Parallax requires to manufacture, distribute and release the Masters as
Phonograph Records, including, but not limited to, mechanical licenses, credits,
musician and producer releases, and any information required to be delivered to
unions or other third parties. Payment of funds due at delivery by Parallax
shall not be deemed a waiver of information or documents required hereunder.
(h) Artist shall be available to Parallax and shall perform for the
purposes of making such music videos at such times and places as Parallax shall
reasonably agree with Artist. The cost of making such music videos shall be
deemed advances hereunder and shall be fifty percent (50%) recoupable from all
sources, excluding Mechanical Royalties, payable to Artist hereunder.
3. GRANT OF RIGHTS
3.01. During the Term of this Agreement, Artist shall furnish to
Parallax its exclusive recording services throughout the Universe. Any contract
entered into by Artist or on Artist's behalf during the Term hereof or any
extensions thereof for Artist's performances in television or radio broadcasts
or motion pictures or stage productions shall specifically exclude the right to
use any recording of such performance for the manufacture and sale of Phonograph
Records or music videos unless previously authorized in writing by Parallax.
Artist shall promptly deliver to Parallax copies of the pertinent provisions of
each such contract and Artist will cooperate fully with Parallax in any
controversy dispute or litigation which may arise in relation to the rights of
Parallax under this Paragraph.
3.02. Artist hereby grants and assigns to Parallax all rights of every
kind and the complete, unconditional, exclusive, perpetual, unencumbered title
throughout the Universe in and to all results and products of Artist's services
and performances hereunder, any and all Masters, records, tapes, sound
recordings, music videos, long form videos, and other material of every kind
made or authorized by Parallax hereunder or otherwise produced during the Option
Terms and which include the voice, instrumental or other sound and/or visual
effects, services, or performances of Artist, including without limitation the
right to record, reproduce, broadcast, transmit, publish, sell, exhibit,
distribute, advertise, exploit, perform, and use the same separately or in
combination with any other material for any purpose in any manner, under any
label, trademark, or other identification and by any means or method, whether
known or not now known, invented, used, or contemplated, and to refrain from all
or any part thereof.
EXCLUSIVE RECORDING ARTIST AGREEMENT-PAGE 3
3.03. Without in any way limiting the generality of the foregoing,
Artist hereby grants to Parallax the following rights throughout the Universe
which Parallax may use or refrain from using as it elects in Parallax's sole
discretion:
(a) the exclusive right during the Term hereof to manufacture, distribute,
and sell anywhere in the Universe Phonograph Records and music videos
reproducing Artist's performances;
(b) the exclusive right for the full periods of copyright to manufacture,
distribute, and sell throughout the Universe Phonograph Records and music videos
produced from Masters made during the Option Terms hereunder;
(c) the exclusive right in all media and forms to advertise, publicize, and
exploit anywhere in the Universe Phonograph Records and music videos produced
during the Option Terms hereunder by any and every means, particularly, but
without limiting the generality of the foregoing, to use the name, including the
professional name, approved photograph and/or likeness of, and approved
biographical material concerning Artist for advertising, publicizing, and
otherwise exploiting said Phonograph Records and music videos, said approval not
to be unreasonably withheld;
(d) the exclusive right to authorize public performances in the Universe of
Phonograph Records and music videos produced during the Option Terms hereunder;
(e) the right to permit and authorize others to exercise, directly or
through persons designated by them, any and all of Parallax's rights hereunder.
3.04. (a) Each Master (including all sound recordings embodied thereon)
produced hereunder or embodying Artist's performances and recorded during the
Initial Term shall belong to Artist. Artist grants Parallax a security interest
in and to its copyright in the First Album to secure recoupment of all sums
expended by Parallax in the recording and promotion of all Albums recorded under
this agreement. Artist further agrees to execute any document reasonably
necessary to perfect such security interest. In the event Artist fails to
execute any such documents or instruments Artist hereby irrevocably grants to
Parallax power of attorney, coupled with an interest, to execute all such
security agreements.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 4
(b) Each Master (including all sound recordings embodied thereon) produced
hereunder or embodying Artist's performances and recorded during the Option
Terms shall, from the inception of its creation, be considered a "work made for
hire" for Parallax within the meaning of the U.S. Copyright Law. If it is
determined that a Master does not so qualify, then such Master, together with
all rights in it (including the sound recording copyright), shall be deemed, and
are hereby transferred and assigned to Parallax by this Agreement. Artist agrees
to execute and deliver to Parallax any and all documents or instruments which
Parallax may request in order to confirm Parallax's acquisition and/or title to
the Masters (including the copyright) as described herein. In the event Artist
fails to execute any such documents or instruments Artist hereby irrevocably
grants to Parallax power of attorney, coupled with an interest, to execute all
such documents of conveyance. All Masters recorded by Artist from the inception
of the recording thereof and all reproductions derived therefrom, together with
the performances embodied thereon, shall be entirely the property of Parallax in
perpetuity, throughout the Universe, free of any claim whatsoever by Artist or
any persons deriving any rights or interests therefrom. 3.05. Artist shall not
authorize or permit Artist's performances to be recorded for any purpose without
obtaining an express written approval of Parallax, and Artist shall take
reasonable measures to prevent the manufacture, distribution and sale of
Phonograph Records or music videos containing its performances (and the use of
Artist's name and likeness in connection therewith) by any person or entity
other than Parallax, its successors, licensees and assigns.
3.06. Artist grants Parallax the right to include any Master produced
and delivered hereunder in a soundtrack or compilation album, at any time, and
without any further advance, except that royalties shall be payable as provided
herein.
3.07. As used in this Agreement, "Phonograph Records" shall include any
and all mechanical reproductions of the Masters produced and delivered
hereunder, in any format, whether now known or unknown, including but not
limited to compact discs, cassette tapes, vinyl records, DAT tapes or any future
format.
4. RECORDING COSTS AND PROCEDURES
4.01. Advances payable to Artist pursuant to this Agreement are and
shall be inclusive of all costs incurred in the course of producing and
recording Masters hereunder (including without limitation, the costs of studio
time, musician fees, union payments, instrument hire, producer's fees, and the
cost of tape editing, mixing, remixing and mastering, advances, and other
similar costs customarily regarded in the industry as being recording costs).
All such costs are sometimes herein referred to as "recording costs" and shall
constitute advances recoupable from royalties payable hereunder. Parallax shall,
in accordance with the provisions of this Agreement, deduct and retain out of
said advances such sums as may be necessary to pay the said recording costs. In
the event that, as a result of an event within the control of the Artist but
unapproved by Parallax, any recording costs shall exceed the amount of the
recording fund specifically referred to in
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 5
Paragraph 5.01 below, then the excess costs shall (if paid by Parallax)
constitute a loan to Artist payable on demand and without prejudice to
Parallax's other rights and the same shall, at Parallax's election, be
recoverable by Parallax out of any monies payable by Parallax to Artist or on
Artist's behalf hereunder. Any recording cost that exceeds the amount of the
recording fund specifically referred to in Paragraph 5.01 below, but which has
been approved by Parallax, shall be treated as an increase in said recording
fund.
4.02. Parallax and Artist shall, prior to the commencement of any
recording: (a) mutually designate the producer(s) of all Masters hereunder; and
(b) agree on a budget for recording costs. Parallax shall not unreasonably
withhold its consent to any budget for recording costs that is less than ninety
percent (90%) of the recording fund for that album as specified in Paragraph
5.01. Parallax has previously approved the budgets for the First and Second
Albums.
4.03. Artist shall be properly rehearsed and shall appear at the times
and places designated by Parallax after consultation with and reasonable notice
to Artist from time to time for all recording sessions required hereunder and at
each session Artist shall tender their professional services to the best of
their ability. Parallax and Artist shall mutually designate the material to be
recorded and each Master shall be subject to Parallax's approval as technically
and commercially satisfactory. Upon Parallax's request, Artist shall re-record
any material until a Master, which in Parallax's sole judgment is satisfactory,
shall have been obtained.
4.04. The Masters delivered to Parallax by Artist under this Agreement
and the performances embodied therein shall be produced in accordance with the
rules and regulations of the American Federation of Musicians, the American
Federation of Television and Radio Artists and all other unions having
jurisdiction. Artist is or will become and remain, to the extent necessary to
fulfill this Agreement, a member in good standing of all labor unions or guilds
in which membership may be required for the performance of Artist's services
hereunder.
4.05. Artist shall not perform for or in connection with (and shall not
permit any other person or entity to use Artist's name or likeness in connection
with) the recording or exploitation of any Phonograph Record embodying any
Composition recorded by Artist under this Agreement prior to a date five (5)
years subsequent to the expiration or termination of the term of this Agreement,
or any extensions thereof.
4.06. Without limiting the foregoing, Parallax shall not be required to
make any payments of any kind for, or in connection with, the acquisition,
exercise or exploitation of rights by Parallax except as specifically provided
in this Agreement. Artist shall be solely responsible for all sums due to labor
unions or guilds, individual musicians, producers and all other persons or
entities entitled to receive royalties or other payments in connection with the
sale of Phonograph Records derived from Masters hereunder, although Parallax
will undertake to make all such payments to the extent of the recording fund
specified in Paragraph 5.01, and Artist's liability to producers for royalties
shall be limited to two percent of retail. None of the persons whose
performances are embodied in the Masters or whose services are used in recording
the Masters shall be bound by any agreement that would restrict such
performances or services, or to the extent they are otherwise bound or
restricted, Artist shall obtain all necessary clearances in writing.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 6
5. ADVANCES AND RECORDING FUND
5.01. As advances against and recoupable from royalties payable
hereunder, Parallax agrees to pay with respect to each Album constituting the
Minimum Recording Commitment hereunder a sum equal to the amount by which the
applicable sum set forth below ("Album Recording Fund") exceeds the sum of the
documented receipts for the recording costs concerned and any other advances
made to Artist prior to delivery of the applicable Album:
Album Recording Fund: First Album $15,000
Second Album $20,000
Third Album $35,000
Fourth Album $75,000
5.02. If net sales through normal retail channels in the United States
for which royalties are payable pursuant to Paragraph 6.01 (a) below, net of
applicable reserves of any album shall exceed seventy-five thousand (75,000)
units as of the date nine (9) months after the initial release of that album in
the United States, then the Album Recording Fund on the next subsequent album
shall be increased by Ten Thousand Dollars ($10,000).
5.03. The advances due under Paragraph 5.01 shall be payable promptly
following the delivery to Parallax of: (a) the Minimum Recording Commitment; (b)
the documents required under Paragraph 2.04(g); and (c) all invoices pertaining
to the recording of the Minimum Recording Commitment. With respect to payments
to be made following delivery. Parallax shall have the right to withhold ten
percent (10%) for ninety (90) days to provide for anticipated costs which have
not yet been paid.
5.04. All advances paid to Artist or on Artist's behalf shall be
recoupable against the royalties payable under this Agreement, from whatever the
source, except that advances shall not be recoupable against Mechanical
Royalties except as provided for in Paragraph 8.01.
6. ROYALTIES
6.01. Subject to Artist's compliance with all obligations required of
Artist hereunder and subject as otherwise granted herein, Parallax will pay to
Artist for the rights granted herein and for the services performed hereunder
the royalties set out below, being percentages of one hundred percent (100%) of
the Parallax's published wholesale price, exclusive of taxes and duties actually
paid by Parallax, and the container cost deductions specified below for. all
records and music videos manufactured, sold and not returned, and for which
Parallax is paid, reproducing exclusively Masters recorded hereunder, namely:
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 7
(a) With respect to sales for distribution in the United States of Albums
reproducing exclusively Masters hereunder: Twenty percent (20%).
(b) The royalty rate with respect to 12-inch singles shall be fifteen
percent (15%).
(c) The royalty rate with respect of 7-inch singles and other records shall
be twelve percent (12%).
(d) The royalty rate with respect to the following is thirteen percent
(13%): records sold to any government body, PX sales, sales to educational
institutions, record clubs, soundtrack records, compilation records, budget
records (defined as a record which is sold at a wholesale price of at least
fifty percent but less than eighty percent of Parallax's published wholesale
price), and EP records (defined as records containing between three and nine
Masters); except that the royalty rate for compilations released exclusively on
the Parallax label shall be twenty percent (20%). Royalties for soundtracks and
compilations on which Artist appears with other performers shall be pro-rated in
the same proportion that Artist's Master(s) bear to the entire album.
(e) Foreign royalty rate: The rate for the records manufactured by Parallax
or Parallax's affiliates and sold outside the United States will be sixty-six
and two-thirds percent (66 2/3%) of the applicable royalty except that the
royalty rate for masters licensed by Parallax outside the United States shall be
fifty percent (50%) of the net income therefrom. Net income shall mean all
income received less third party out of pocket expenses to establish the
license, third party out of pocket collection costs, foreign currency exchange,
wire transfer fees and applicable taxes.
(f) Royalty rate for music videos sold and not returned shall be ten
percent (10%) of Parallax's published wholesale price.
7. ROYALTY PAYMENTS
7.01. Royalties earned hereunder will be accrued semi-annually and
paid, less all advances, taxes, and any other charges, within sixty (60) days
following each June 30th and December 31 st for the preceding six (6) month
period, in accordance with Parallax's regular accounting practices. Parallax
shall, however, have the right to establish reasonable reserves for returns and
exchanges, said reserves not to exceed thirty percent (30%). Each reserve
established hereunder shall be liquidated at the end of the following
semi-annual period. If Parallax makes any overpayment of royalties (e.g., by
reason of an accounting error or paying royalties on Records returned later),
Parallax shall have the right to offset such overpayment against any subsequent
payment due to Artist from Parallax.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 8
7.02. Each royalty payment hereunder shall be accompanied by a
statement in accordance with Parallax's regular accounting practices. Said
statements shall be provided to Artist within sixty (60) days of the end of each
calendar quarter, even though royalty payments are semi-annual. Each statement
shall become binding upon Artist and Artist shall neither have nor make any
claim against Parallax with respect to such statement, unless Artist shall
advise Parallax, in writing, of the specific basis of such claim within one (1)
year after the date Parallax mails such statement. Parallax's accounting books
and records will be kept and maintained in accordance with generally accepted
accounting principles, consistently applied.
7.03. Artist shall not be entitled to recover damages or to terminate
this Agreement for any reason because of a claimed breach by Parallax of its
material obligations hereunder, unless Parallax has failed to remedy such breach
within sixty (60) days following receipt of written notice thereof. Artist will
not have the right to xxx Parallax in connection with any royalty accounting, or
xxx Parallax for royalties accrued by Artist during the period a royalty
accounting covers, unless Artist commences the suit within two (2) years after
the date when the statement in question is rendered to Artist. If Artist
commences suit on any controversy or claim concerning royalty accountings
rendered to Artist under this Agreement, the scope of the proceeding will be
limited to the determination of the amount of royalties due for the accounting
periods covered and reasonable attorney fees, and the court will have no
authority to consider any other issues or award any relief except recovery of
any royalties found owing. Artist's recovery of any such royalties and
attorney's fees will be the sole remedy available to Artist by reason of
Parallax's royalty accountings. Without limiting the generality of the preceding
sentence, Artist will not have any right to seek termination of this Agreement
or avoid the performance of their obligations under it by reason of any such
claim. Artist's remedy for Parallax's willful refusal to permit it to record its
Minimum Recording Commitment shall be limited to termination of this Agreement.
7.04. Parallax agrees that Artist may, not more than once during any
calendar year, but only once with respect to any statement rendered hereunder,
audit its books and records for the purpose of determining the accuracy of
Parallax's statements to Artist. If Artist wishes to perform any such audit,
Artist will be required to notify Parallax at least thirty (30) days before the
date when Artist plans to begin the audit plans to begin the audit. If Artist's
audit has not been completed within one (1) month from the time Artist begins
it, Parallax may require Artist to terminate it on seven (7) days notice to
Artist and Parallax will not be required to permit Artist to continue the
examination after the end of that seven (7) day period. Artist shall not be
entitled to examine any manufacturing records or any other records which do not
specifically report sales of Records or calculation of net receipts on which
royalties are accruable hereunder. All audits shall be made during regular
business hours, and shall be conducted on Artist's behalf by an independent
Certified Public Accountant. Each examination shall be made at Artist's sole
expense at Parallax's regular place of business in the United States, where the
books and records are maintained.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 9
8. MECHANICAL LICENSES AND ROYALTIES
8.01. All Controlled Compositions (defined as musical compositions
composed in whole or in part by any individual member of Artist) are hereby
licensed to Parallax and its licensees for reproduction on Phonograph Records
anywhere in the Universe. Royalties for the mechanical license herein granted
shall be at a rate equal to seventy-five percent (75%) of the current minimum
U.S. statutory rate (including the "long work" rate, if applicable) for
royalty-bearing records sold and not returned and for which Parallax is paid,
excluding any instance where Parallax and Artist are sharing income under
Paragraph 6.01(e) above. In no event shall the mechanical royalties payable
hereunder for any Album exceed ten (10) times the rate set forth above. The
foregoing also applies to music videos, as well as to any instance where such a
license must be executed in favor of Parallax, Parallax shall not recoup from
mechanical royalties due to Artist any advances payable to Artist except: (a)
excess recording costs under Paragraph 4.01; (b) overpayments under Paragraph
7.01; and (c) any advances of cash or consigned materials (or the like) to
Artist.
8.02. If any record contains one or more compositions which are not
Controlled Compositions, then Parallax will have the right to reduce the amount
of Mechanical Royalties payable on the Controlled Compositions by an amount
equal to the amount of mechanical royalties payable on non-Controlled
Compositions.
9. TRADEMARKS
9.01. Artist shall perform under the professional name, "Track 10" or
"Track Ten." Artist warrants and represents that it is the sole owner of such
name in connection with Phonograph Records during the term hereof. Artist shall
not use a different name in connection with Phonograph Records unless Artist and
Parallax mutually agree in writing. Artist agrees that Parallax may cause a
search to be instituted for the purpose of determining whether any professional
name used by Artist has been or is being used by another person in connection
with Phonograph Records. Parallax may cause one or more federal applications for
trademark protection to be made in favor of Artist for Phonograph Record and/or
entertainment purposes. Any amounts up to One Thousand Seven Hundred Dollars
($1,700.00) expended by Parallax pursuant to this Paragraph shall be deemed
Advances hereunder. If the trademark search indicates that such name should not
be used, Parallax and Artist shall mutually agree on a substitute name for
Artist. Nothing contained herein shall release Artist from its indemnification
of Parallax with respect to Artist's use of such name.
10. FREE GOODS
10.01. No royalties shall be payable with respect to records given away
or furnished on a "no charge" basis to one-stops, rack jobbers, distributors,
dealers, radio stations, television stations or film companies, theatrical
hooking agencies, print media, music publishers or the like, provided that such
records do not exceed one hundred (100) non-royalty bearing Singles out of every
one thousand (1,000) Singles distributed and one hundred (100) non-royalty
bearing Albums out of every one thousand (1,000) Albums. Any record sold for
less than fifty percent (50%) of Parallax's published wholesale price will be a
non-royalty bearing record.
EXCLUSIVE RECORDING ARTIST AGREEMENT -PAGE 10
10.02. During each applicable contract period, Parallax shall provide
Artist with fifteen (15) non-royalty bearing copies of Artist's then current
Album at no charge to the Artist.
11. CONTAINER COSTS
11.01. Parallax's container deduction shall be a sum equal to: one
dollar ($1.00) for singles, one dollar and fifty cents ($1.50) for LPs and
cassettes, two dollars ($2.00) for double LP sets and compact discs, three
dollars ($3.00) for double cassettes, and four dollars ($4.00) for other
formats, including double compact disks, and all video formats.
12. INDEMNIFICATION
12.01. Artist agrees to and does hereby indemnify, save and hold
Parallax and its licensees harmless of and from any and all liability, loss,
damage, cost, or expense (including all legal expenses and reasonable attorney
fees) arising out of or connected with any breach of this Agreement or any claim
which is inconsistent with any of the warranties or representations made by
Artist in this Agreement, and Artist agrees to reimburse Parallax on demand for
any payment made or incurred by Parallax with respect to the foregoing if the
claim concerned is settled or has resulted in a final judgment against Parallax
or its licensees. Pending the determination of any claim with respect to which
Parallax is entitled to indemnity, Parallax may withhold monies which would be
otherwise payable to Artist up to the amount of its potential liability.
13. DEFAULT AND TERMINATION
13.01. In the event of any default or breach by Artist in the
performance of any of Artist's obligations hereunder, Parallax may, without
prejudice to its other rights, claims or remedies, suspend its obligations
hereunder for the duration of such default or breach and until the same has been
cured and may, at its option, extend the Term for a period equal to all or any
part of the period of such default or breach, and in such event the dates for
the exercise by Parallax of the Option Periods hereunder and the dates of
commencement of each subsequent Option Period shall be extended accordingly.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 11
14. FORCE MA JEUR
14.01 If Parallax's material performance hereunder is delayed or
becomes impossible or impractical because of any act of God, fire, earthquake,
strike, act of government or any order, regulation, ruling, or action of any
labor union or association of artists affecting Parallax or Artist or the
phonograph record industry, Parallax, upon notice to Artist may suspend its
obligations under this Agreement for a period not to exceed one (1) year, and in
such event the number of days equal to the number of days of such suspension
shall be added to the then-current period of the Term thereof. In the event that
Parallax's material performance hereunder is delayed or becomes impossible or
impractical because of any civil strife, Parallax, upon notice to Artist, may
suspend its obligations under this Agreement for the duration of such delay,
impossibility or impracticability and in such event the number of days equal to
the number of days of such suspension shall be added to the then-current period
of the Term thereof.
15. MERCHANDISING
15.01. Artist hereby grants Parallax the exclusive right to
manufacture, sell, license, distribute and exploit, throughout the Universe and
by mail-order and through retail sources of, without limitation, all merchandise
of every kind featuring the Artist (name/logo/likenesses), during the term of
this Agreement.
15.02. It is expressly agreed and understood that any contract for the
purpose of merchandising Artist entered into by Parallax during the Term shall
continue in full force and effect in accordance with the provisions thereof for
a period not to exceed one (1) year following the expiration of the term of this
Agreement.
15.03. In the case of any such products or property manufactured and
sold by Parallax or by any associated company, Artist shall be entitled to a
royalty of twenty percent (20%) of the adjusted gross receipts therefrom. As
used in this paragraph, the term "adjusted gross" shall mean gross revenues from
the sale of applicable merchandise, less venue commissions and state sales tax
where collected and actually paid. In the event that Parallax licenses to others
any of its rights under this clause, then Artist shall receive fifty percent
(50%) of the net receipts therefrom. As used in this paragraph, the term "net
receipts" shall be calculated as gross revenues from the sale of the applicable
merchandise, less the cost actually incurred and paid by Parallax or its
licensing company for manufacturing; sales personnel salaries and/or
commissions, venue commissions and state sales tax where collected and actually
paid.
15.04. Artist has the right of approval of all merchandising artwork,
so long as said approval is that unreasonably withheld. During the Term of this
Agreement, Artist shall cause the inclusion of Parallax's logo and proper name
at a reasonable size and position on all merchandise.
15.05. No royalties shall be payable with respect to merchandise given
away or furnished on a no-charge basis. Upon Artist's request, Parallax shall
provide Artist with twenty (20) non-royalty-bearing samples of each item of
merchandise at no charge.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 12
16. ARTWORK
16.01. Artist agrees that Parallax is the owner of any and all artwork,
LP jacket art, and promotional artistic renderings undertaken or completed
within the Option Terms of this Agreement. Artist shall have the right to use
artwork which has been mutually approved by Parallax and Artist for the purpose
of merchandising.
17. NOTICES
17.01. All notices, demands or the like which are required to be given
hereunder shall be in writing and may be served upon the other party personally
by Registered Mail, Return Receipt Requested, or by telecopy (facsimile). Notice
to Artist will be received by:___________________________and notice to Parallax
will be received by: Xxxx Xxxxxx, Parallax Entertainment, Inc., 00000 Xxxxxxxxx
Xx., Xxxxx 000, Xxxxxx, Xxxxx 00000.
18. PROMOTIONS AND ADVERTISING CAMPAIGNS
18.01. Any promotional monies spent by Parallax on behalf of Artist are
fifty percent (50%) recoupable from monies otherwise due to Artist from
Parallax, excluding Mechanical Royalties, notwithstanding the source. Any
promotional monies spent on behalf of Artist in combination with other Parallax
Artists shall be recoupable from Artists on a pro-rata basis.
18.02. Parallax is not obligated to produce a promotional video for
Artist, but if Parallax undertakes to produce said video, the cost is fifty
percent (50%) recoupable from royalties, excluding Mechanical Royalties,
notwithstanding the source. The cost of producing nonpromotional videos intended
for resale are fully recoupable.
19. CONTROLLING LAW
19.01. This Agreement is entered into and performable in Dallas County,
Texas and the validity, interpretation and legal effect of this Agreement shall
be governed by Texas law. Venue for any legal action shall be in Dallas County,
Texas.
20. REMEDIES
20.01. Artist acknowledges, recognizes and agrees that his services
hereunder are of a special, unique, unusual, extraordinary and intellectual
character which gives them a peculiar value, the loss of which cannot be
reasonably or adequately compensated for by damages in an action of law.
Inasmuch as a breach of such services will cause Parallax irreparable damages,
Parallax shall be entitled to injunctive and other equitable relief, in addition
to whatever legal remedies are available, to prevent or cure any such breach or
threatened breach.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 13
21. HEADINGS
21.01. The headings of the clauses herein are intended for convenience
only, and shall not be of any effect in construing the contents of this
Agreement.
22. RELATIONSHIP
22.01. Artist has the status of an independent contractor and nothing
herein contained shall contemplate or constitute Artist or its members as
Parallax's agents or employees. This Agreement does not and shall not be
construed to create a partnership or joint venture between the parties to this
Agreement
23. VALIDITY AND MODIFICATIONS
23.01. The invalidity or unenforceability of any provision shall not
affect the validity or enforceability of any other provision. This Agreement
contains the entire understanding of the parties relating to its subject matter.
No change of this Agreement will he binding unless signed by all parties hereto
or their duly authorized representatives. A waiver by either party of any
provision of this Agreement in any instance shall not be deemed to waive it for
the future. All remedies, rights, undertakings and obligations contained in this
Agreement shall be cumulative and none of them shall limit any other remedy,
right, undertaking or obligation.
24. ASSIGNMENT
24.01. Parallax may assign its rights under this Agreement in whole or
in part.
25. LEGAL REPRESENTATION
25.01. Artist, by their signature hereto, confirms that Parallax has
advised Artist to take independent legal counsel, from a lawyer specializing
generally in the music business and specifically in the negotiation of recording
agreements, on the terms and conditions of this Agreement and on the obligations
being undertaken by Artist in executing the Agreement.
26. COOPERATION
26.01. Artist shall execute such other documentation and shall give
such further assurances as may reasonably be necessary or desirable for the
purpose of vesting, confirming, protecting or further assuring any of the rights
granted herein.
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 14
27. DISCLAIMER
27.01. Parallax has not made and does not hereby make any
representation or warranty with respect to the extent of the sale of records or
the exploitation of music videos hereunder.
SIGNED THIS ________DAY OF AUGUST, 2000.
PARALLAX ENTERTAINMENT, INC.
By:__________________________
Xxxx Xxxxxx, President
00000 Xxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
ARTIST:
P/k/a _______________________
By:__________________________
Printed name: Xxxxxx Xxxxxxxx
SSN: ###-##-####
By:__________________________
Printed/name: Xxxxxx X. Xxxxxx
SSN: 505-04 6073
By:__________________________
Print name : Xxxx an Vleet
SSN: ###-##-####
Artist Address: 0000 Xxxxxxxx Xx.
--------------------
Xxxxx #000
-----------------------------------
Xxxxxx, XX 00000
-----------------------------------
EXCLUSIVE RECORDING ARTIST AGREEMENT - PAGE 15
