DIGITAL MUSIC DISTRIBUTION AGREEMENT
This AGREEMENT (hereinafter referred to as the "Agreement") is made effective immediately by and between the artist (hereinafter referred to as the "Label") and RareHipHop.com LLC, located in Queens, New York 11422 (hereinafter referred to as the "Distributor"). Distributor is a Digital Music Distribution company, which offers sound recordings for download by consumers over the Internet (or any successor global computer network) and other digital and/or electronic media. Label owns or has the rights to digitally and/or electronically distribute the master sound recordings referred to in the Addendum attached and any additional Addenda added by agreement of the parties from time to time (hereinafter referred to as "Licensed Recordings").
In consideration of the respective covenants contained herein, the parties hereto, intending to legally bound hereby, agree as follows:
1. Grant of License.
1.1. Licensed Recordings. Label hereby grants to Distributor the right and license during the Term of Grant throughout the Territory to:
(a) Make, cause or otherwise effect Digital Audio Transmissions and Digital Phonorecord Deliveries of the Licensed Recordings;
(b) Digitally and/or electronically promote, market, distribute and sell the Licensed Recordings over the Internet (or any successor global computer network); and
(c) Edit the Licensed Recordings into segments for promotional and marketing purposes.
1.2 The term "Digital Audio Transmission" shall mean a transmission that embodies a sound recording. The term "Digital Phonorecord Delivery" shall mean each individual delivery of a phonorecord by digital transmission of a sound recording which results in a specifically identifiable reproduction by or for any transmission recipient of a phonorecord of that sound recording.
1.3. Reserved Rights. All rights and licenses not expressly granted to Distributor hereunder are reserved by Label. Ownership of the Licensed Recordings and Licensed Artwork shall remain with Label or its licensors. The term "Licensed Artwork" shall mean any artwork, drawings, photographs, liner notes, or other graphical, textual or other graphical works relating to Artist or Label, developed or created by or for Label for use in connection with the distribution or promotion of the Licensed Recordings, and delivered to Distributor hereunder.
2. Delivery. Label shall within two weeks following the execution of this Agreement, deliver to Distributor a digital copy of the master versions of each Licensed Recording hereunder; a reasonable number of items of the related artwork for use by Distributor in connection with the marketing and promotion of the Licensed Recordings; together with any additional copyright information known to Label relating to the Licensed Recordings, and a list of credits that Label is contractually required or otherwise reasonably desires to provide in connection with the distribution of the Licensed Recordings hereunder. Except as provided in paragraph 1.1(b) and (c) above, Distributor shall have no right to modify the Licensed Recordings, but may encode the Licensed Recordings in any format now known or hereafter devised for purposed of facilitating the exercise of the rights and licenses granted hereunder.
3. Territory. The Territory shall be the world.
4. Term. The Term shall commence upon the date hereof and shall expire three (3) years from the date hereof. Thereafter, the term shall extend from year to year unless one party gives the other party notice of termination. Either party may cancel the Agreement with thirty (30) days prior written notice. Notice shall be provided in accordance with paragraph 11.1 below.
5.1. Royalties. Distributor shall pay to Label 60% for each of Label's individual songs sold on RareHipHop.com and 60% for each of Label's full album downloads sold on RareHipHop.com (hereinafter referred to as "Royalty Fee").
5.2. The term "Royalty Fee" shall mean gross revenues less only the following costs and fees incurred in connection with such deliveries, and only to the extent incurred:
(a) returns and credits, including, but not limited to, those on account of defective merchandise, errors in billing, and errors in transmission, if any; and
(b) union, guild or other third party fees that may be required by contract or the Copyright Act, if any.
(c) transactional fees for downloading are deducted from your account and will be recognized on your individual summary.
6. Record Keeping and Report.
6.1. Distributor agrees to maintain and preserve accurate books and records concerning all transactions relating to the reproduction and distribution of the Licensed Recordings for a period of two (2) years following the termination of this Agreement.
6.2. Distributor will compute the royalties to Label pursuant to this Agreement within thirty (30) days after the end of each calendar quarter (i.e., ending March 31, June 30, September 30, and December 31), and will deliver to Label a quarterly royalty statement for each such period together with the net amount of royalties, if any, computed in accordance with this Agreement. Payment shall be made to Label after the Royalty Fee amounts to at least $50 and Distributor shall hold the Royalty Fees until such time, without owing any interest on said retained Royalty Fee to Label.
7. Warranties of Non-Exclusivity, Originality and Ownership.
7.1. Label Warranties: By offering the Licensed Works for release under this Agreement, Label represents and warrants the following:
(a) Label is the sole author of the Licensed Works and/or has secured all rights in the Licensed Works necessary to grant the license rights hereunder and to permit the lawful exercise by Distributor of the rights hereunder, including all cover songs, samples, excerpts, recordings, lyrics, rhythms and melodies, without Label or Distributor having to pay any royalties, compulsory license fees, residuals or any other payments. Label will make any and all royalty payments due to any third-parties on account of gross revenues received through Distributor.
(b) The Licensed Works do not infringe the copyright, trademark, publicity rights, common law rights, or any other right of any third party or is otherwise illegal or constitute defamation, invasion of privacy or any tort injury to any third party.
8. Operational Duties.
8.1. Marketing of the Licensed Works. Licensed Recordings that have been accepted by Distributor shall be posted and available for Distributor's customers and categorized by Label's name and genre. Distributor shall have no further duties concerning the marketing or promotion of the Licensed Works and Artists. Distributor, in its sole discretion, shall be permitted to promote, market, and advertise the Licensed Works and Artists without limitation.
8.2 Pricing. Label shall decide, in its sole discretion, the price plan of all sales of the individual Licensed Recordings, while the Distributor shall decide the price for full album downloads which currently is $9.99.
9. Indemnity and Limitation of Liability
9.1. Label's Indemnity. Label shall indemnify and defend Distributor and hold Distributor harmless from and against any and all costs, liabilities, losses, damages and expenses arising out of any claims, actions, suits, or proceedings of any kind from any third party claim relating to (i) a breach of Label's warranties and/or duties under this Agreement, (ii) any claim for royalties and/or infringement or copyright, trademark, patent or other intellectual property rights or (iii) any third party claims arising out of Label's conduct or representations under this Agreement. Further, in the event that a third party infringement claim is brought, Distributor shall have no obligation hereunder to defend and protect Label's copyright interests.
9.2. Limitations on Liability. Distributor makes no warranty with respect to the accuracy or effectiveness of the Distributor's website, including content contained therein, nor any errors or problems of any kind that my arise from the website. Distributor shall not be responsible for losses, damages, costs, or expenses of any kind resulting from the use or distribution of the Licensed Works by Distributor or use by any consumer or end-user. This includes, without limitation, any liability for business expenses or damages experienced by Label or any third persons as a result of any deficiency, defect, error, or malfunction with the electronic distribution or the transfer or distribution of the Licensed Works.
10. Additional Representations and Warranties of the Parties.
10.1. Each party represents and warrants that it has full authority to enter into this Agreement and to fully perform its obligations hereunder and has obtained all necessary third-party consents, licenses and permissions necessary to enter into and fully perform its obligations herein.
10.2. Each party represents and warrants that it owns or controls the necessary rights in order to make the grant of rights, licenses and permissions herein, and that the exercise of such rights, licenses and permissions by the other party hereto shall not violate or infringe the rights of any third party.
10.3. Each party represents and warrants that it shall not act in any manner which conflicts or interferes with any existing commitment or obligation of such party, and that no agreement previously entered into by such party will interfere with such party's performance of its obligations under this Agreement.
11.2. Waiver and Severability. The failure of either party to require performance by the other party of any provision hereof shall not affect the full right to require such performance at any time thereafter; nor shall the waiver by either party of a breach of any provision hereof be taken or held to be a waiver of the provision itself. In the event that any provision of this Agreement shall be unenforceable or invalid under any applicable law or be so held by applicable court decision, such unenforceability or invalidity shall not render this Agreement unenforceable or invalid as a whole, and, in such event, such provision shall be changed and interpreted so as to best accomplish the objectives of such provisions within the limits of applicable law or applicable court decisions.
11.3. No agency. The relationship between Distributor and Label is that of independent contractors. Nothing contained herein shall be construed as creating any agency, partnership, or other form of joint enterprise between the parties or to allow either party to bind the other or incur any obligation on its behalf.
11.4. Counterparts. This Agreement may be executed in two or more counterparts, each of which will be considered an original, but all of which together will constitute on and the same instrument.
11.5. Assignment. Distributor may assign this Agreement to any entity to which it transfers all or substantially all of its ownership interest, whether through merger, acquisition or sale of assets. Otherwise, neither party may assign, voluntarily, by operation of law, or otherwise this Agreement without the other party's prior written consent, and any attempt to do so without that consent will be void. This Agreement will bind and inure to the benefit of the parties and their respective successors and permitted assigns.
11.6. Entire Agreement. This Agreement is the entire agreement between Distributor and Label, which supersedes any prior or contemporaneous agreement or understanding, whether written or oral, and any other communications between Distributor and Label relating to the subject matter of this Agreement. This Agreement may not be changed orally, but only by writing and signed by both parties which specifically references this Agreement.
12. Offensiveness. You understand that by using any of our services, you may encounter content that may be deemed offensive, indecent, or objectionable, which content may or may not be identified as having explicit language. Nevertheless, you agree to use the services at your sole risk and that Rare Hip-Hop shall have no liability to you for content that may be found to be offensive, indecent, or objectionable. Content types (including genres, sub-genres and Podcast categories and sub-categories and the like) and descriptions are provided for convenience, and you acknowledge and agree that Rare Hip-Hop does not guarantee their accuracy.
13. Third Party Links. Certain services may include materials from third parties or links to certain third party web sites. You acknowledge and agree that Rare Hip-Hop is not responsible for examining or evaluating the content or accuracy of any such third-party material or web sites. Rare Hip-Hop does not warrant or endorse and does not assume and will not have any liability or responsibility for any third-party materials or web sites, or for any other materials, products, or services of third parties. Links to other web sites are provided solely as a convenience to you. You agree that you will not use any third-party materials in a manner that would infringe or violate the rights of any other party, and that Rare Hip-Hop is not in any way responsible for any such use by you.
14. Proprietary Content. You agree that the services, including but not limited to graphics, audio clips, and editorial content, contain proprietary information and material that is owned by Rare Hip-Hop and/or its licensors, and is protected by applicable intellectual property and other laws, including but not limited to copyright, and that you will not use such proprietary information or materials in any way whatsoever except for permitted use of the Services. No portion of the Services may be reproduced in any form or by any means. You agree not to modify, rent, lease, loan, sell, distribute, or create derivative works based on the services, in any manner, and you shall not exploit the services in any unauthorized way whatsoever, including but not limited to, by trespass or burdening network capacity.
DISCLAIMER OF WARRANTIES
YOU EXPRESSLY ACKNOWLEDGE AND AGREE THAT USE OF THE RARE HIP-HOP SERVICES IS AT YOUR SOLE RISK AND THAT THE ENTIRE RISK AS TO SATISFACTORY QUALITY, PERFORMANCE, ACCURACY AND EFFORT IS WITH YOU. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE RARE HIP-HOP SERVICES ARE PROVIDED "AS IS", WITH ALL FAULTS AND WITHOUT WARRANTY OF ANY KIND, AND RARE HIP-HOP AND RARE HIP-HOP'S LICENSORS HEREBY DISCLAIM ALL WARRANTIES AND CONDITIONS WITH RESPECT TO THE RARE HIP-HOP SERVICES, EITHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES AND/OR CONDITIONS OF MERCHANTABILITY, OF SATISFACTORY QUALITY, OF FITNESS FOR A PARTICULAR PURPOSE, OF ACCURACY, OF QUIET ENJOYMENT, AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS. RARE HIP-HOP DOES NOT WARRANT AGAINST INTERFERENCE WITH YOUR ENJOYMENT OF THE RARE HIP-HOP SERVICES, THAT THE FUNCTIONS CONTAINED IN THE RARE HIP-HOP SERVICES WILL MEET YOUR REQUIREMENTS, THAT THE OPERATION OF THE RARE HIP-HOP SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE, OR THAT DEFECTS IN THE RARE HIP-HOP SERVICES WILL BE CORRECTED. NO ORAL OR WRITTEN INFORMATION OR ADVICE GIVEN BY RARE HIP-HOP OR AN RARE HIP-HOP AUTHORIZED REPRESENTATIVE SHALL CREATE A WARRANTY. SHOULD THE RARE HIP-HOP SERVICES PROVE DEFECTIVE, YOU ASSUME THE ENTIRE COST OF ALL NECESSARY SERVICING, REPAIR OR CORRECTION. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES OR LIMITATIONS ON APPLICABLE STATUTORY RIGHTS OF A CONSUMER, SO THE ABOVE EXCLUSION AND LIMITATIONS MAY NOT APPLY TO YOU.
CONTROLLING LAW AND SEVERABILITY
This License will be governed by and construed in accordance with the laws of the State of New York, as applied to agreements entered into and to be performed entirely within New York between New York residents. This License shall not be governed by the United Nations Convention on Contracts for the International Sale of Goods, the application of which is expressly excluded. If for any reason a court of competent jurisdiction finds any provision, or portion thereof, to be unenforceable, the remainder of this License shall continue in full force and effect.