License of Sound Recordings
For Digital Download Service

DIGITAL DISTRIBUTION AGREEMENT

THIS LICENSE FOR SOUND RECORDINGS (the “Agreement”) is entered into between The Christian Jukebox, LLC, and you the artist (“Owner”) (each a “Party” and, collectively, the “Parties”).

WHEREAS, Licensee offers sound recordings for digital distribution over the Internet, and Owner owns or controls the rights to, or shall own or control the rights to, certain sound recordings of the artist, including the literary works, sound recordings, audiovisual works, artwork, photographs, and other works of authorship, set forth in Exhibit A, attached hereto (hereinafter, the “Licensed Works”).

The parties agree as follows:

1.         DEFINITIONS

            1.1        To “digitally distribute” shall mean to make, cause or otherwise effect Digital Delivery Transmissions and Digital Streaming Transmissions of the Licensed Works, or any portion thereof, by any means now known or hereafter devised, including but not limited to subscription and non-subscription services, and transmissions by interactive and non-interactive services.

            1.2        The term "Digital Delivery Transmission" shall mean each individual delivery, distribution, display, or performance of a work by digital transmission of such work which results in a specifically identifiable reproduction by or for any transmission recipient of a copy or Phonorecord of that work by any means now known or hereafter devised.

            1.3        The term "Digital Streaming Transmission" shall mean each individual delivery, distribution, display, or performance of a work by digital transmission of such work which does not result in a specifically identifiable reproduction by or for any transmission recipient of a copy or phonorecord of that work by any means now known or hereafter devised.

            1.4        The term “sound recording” shall mean a work resulting from a fixation in copies or phonorecords of a series of musical, spoken, or other sounds.

            1.5        The term “audiovisual work” shall mean a work that consists of series of related images which are intrinsically intended to be shown by the use of machines or devices such as projectors, viewers or electronic equipment, together with accompanying sounds, if any.

2.         GRANT OF LICENSE

            2.1        Licensed Works. Subject to the terms and condition hereof, Owner hereby grants to Licensee a non-exclusive right and license throughout the universe to digitally distribute the Licensed Works, including any portion thereof, by any and all means and media now known or hereafter devised. The foregoing rights and licenses shall be limited to digital distribution, as defined above. So that there may be no misunderstanding, to digitally distribute does not mean to distribute either (a) in physical form, such as in books, CD’s, videotapes, DVDs, or motion picture theatrical distribution, or (b) by analog broadcast or transmission, such as television broadcast.

            2.2        Name Voice, and/or Likeness. Owner hereby grants to Licensee a non-exclusive right and license throughout the universe to use, reproduce, display, perform, distribute, transmit, publicly and privately, the name, voice, and/or likeness of Artist, solely in connection with the digital distribution of the Licensed Works hereunder and the promotion thereof, by any and all means and in any and all media now known or hereafter devised. The term "name and/or likeness" shall mean the name, voice, photograph, drawing, likeness, biographical material, any and all words, symbols, and logos which identify Artist, and any and all trademarks, service marks, trade names, or similar properties, of, relating to or associated with such person, and any other exercise of the "right of publicity" of, relating to, or associated with Artist.

            2.3        Artwork. Owner hereby grants to Licensee a non-exclusive right and license throughout the universe to use, reproduce, display, perform, distribute, transmit, publicly and privately, any Artwork created for use with the Licensed Works, solely in connection with the digital distribution of the Licensed Works hereunder and the promotion thereof, by any and all means and in any and all media now known or hereafter devised. The term "Artwork" shall mean any artwork, drawings, photographs, liner notes, promotional and advertising material, or other graphical, textual or other graphical works relating to the performances or performers featured in the Licensed Works or developed or created by or for Owner for use in connection with the distribution or promotion of the Licensed Works.

            2.4        Encoding. Licensee may prepare and encode the Licensed Works, or any portion thereof, for purposes of facilitating the exercise of the rights and licenses granted hereunder, in any digital format (e.g., Real Audio, Windows Media, MP3, etc.), now known or hereafter devised, including formats that are accompanied by or synchronized with textual material, copyright information, and/or visual or audiovisual images, related to or created for use with the Licensed Works. Though Licensee shall have no right or license to distribute physical copies or phonorecords containing the Licensed Works to the public, Licensee may make copies or phonorecords containing the Licensed Works encoded in any digital format (e.g., Real Audio, Windows Media, MP3, etc.), for the purpose of (a) facilitating its digital distribution hereunder and (b) promoting the Licensed Works (e.g., placing sample MP3 files of a portion of a Licensed Work on a CD for distribution by a computer or mobile phone manufacturer).

            2.5        Reserved Rights. All rights and licenses not expressly granted to Licensee hereunder are reserved by Owner. Ownership of the Licensed Works shall remain with Owner or its licensors.

3.                  TERM AND TERMINATION

            The license granted under this Agreement will continue in force until terminated, as set forth herein. If Licensee fails to pay any royalties or provide any services due in connection with this agreement, or violates any term or condition of this Agreement, Owner or its agent may terminate this License immediately by giving notice of termination to Licensee. Licensee also may terminate this License voluntarily by giving notice of termination to Owner and removing or returning to Owner all copies of all Licensed Works in Licensee's possession or under Licensee's control.

4.                  EFFECT OF TERMINATION

            Immediately upon termination, Licensee will remove listings of all Licensed Works in Licensee's database or under Licensee's control. Licensee will have no right to use any copy of the Licensed Works and related name and/or likeness for any purpose after termination of this Agreement.

5.         DELIVERY

            Within seven (7) days after the date hereof, and thereafter within seven (7) days of the creation or discovery of any new Licensed Works hereunder, Owner shall deliver to Licensee CDs, tapes, vinyl records, videotapes, or other master versions of each Licensed Work hereunder with Owner bearing the risk of loss and responsibility for such delivery; a reasonable number of items of the Artwork related to such Licensed Works, for use by Licensee in connection with the marketing and promotion of the Licensed Works; and, a written schedule of the names and contact information of any author(s), composer(s), and music publisher(s) of any songs or other third party materials embodied in the Licensed Works, together with any additional copyright information known to Owner relating to such materials and the Licensed Works, and a list of credits that Owner may be contractually required or otherwise reasonably desires to provide in connection with the distribution, exploitation of the Licensed Works hereunder.

6.         CONSIDERATION

            6.1        Royalties.  The term “Royalties” under the terms of this contract agreement shall mean payment to an Owner for each copy of work sold. Licensee shall pay to Owner a sum equal to sixty percent (60%) of any and all Gross Revenues derived from the Licensed Works hereunder (“royalties”).

                        6.1.1     In the event the Licensed Works, or portion thereof, are included in a compilation of other works, Owner shall receive a sum equal to a proportionate part of the Net Revenues derived from the compilation determined by dividing the number of Licensed Works in the compilation by the total number of works of like length or nature in the compilation. Likewise, in the event of fees charged on a subscription basis, Owner shall receive a sum equal to a proportionate part of the Net Revenues derived from the subscription transmissions determined by dividing the number of transmissions of the Licensed Works in the subscription service by the total number of works of like length or nature transmitted as part of the subscription service during the applicable accounting period.

                        6.1.2     Notwithstanding anything contained herein to the contrary, Net Revenues shall not include, and no royalties shall be payable to Owner on, any Licensed Works reproduced, distributed, performed, displayed, delivered or transmitted on a "free" or "no charge" basis, or otherwise where the recipient is not charged a fee to receive such Licensed Works. Without limiting the generality of the foregoing, any and all Licensed Works shall be and are hereby licensed to Licensee on a royalty-free basis for the purpose of making, causing or effecting transmissions of the Licensed Works for promotional purposes, such as, for example, Digital Streaming Transmissions (e.g., digital radio web casts or interactive audio or audiovisual, "streaming" transmission) of a Licensed Work, or Digital Delivery Transmissions of a portion of a Licensed Work, for the purpose of allowing consumers to listen to the Licensed Work in connection with the consumer's decision whether to purchase a Digital Delivery Transmission thereof or other promotional purpose.

                        6.1.3     The share of Gross Revenues payable to Owner hereunder includes all royalties due Owner, the Artist(s), individual producers, the director, the performers, engineers, and any other persons engaged in connection with the creation of the Licensed Works. Owner shall be solely responsible for the payment of any royalties due such persons, unions, guilds or other third parties arising from payments made to Owner hereunder, except that Licensee shall effect payment for any and all mechanical and public performance royalties with respect to any musical works embodied in the Licensed Works which become due with respect to the exercise of the rights and licenses herein by Licensee. To the extent there is any delay in Licensee's obtaining any mechanical licenses necessary for it to make digital deliveries containing copyrighted music hereunder, the parties will rely on, and operate under the authority of, Owner's existing mechanical licenses for that purpose.

7.         RECORD KEEPING AND REPORTS

            7.1       Licensee agrees to maintain and pre­serve accurate books and records concerning all transactions relating to the reproduction and distribution of the Licensed Works for a period of two (2) years following the termination of this Agreement.

            7.2        Licensee will compute the royalties to Owner pursuant to this Agreement within forty-five (45) days after the end of each calendar quarter (i.e., ending March 31, June 30, September 30, and December 31), and will deliver to Owner a quarterly royalty statement for each such period together with the net amount of royalties, if any, com­puted in accordance with this Agreement, which shall be payable after deducting any and all unrecouped advances or other charges hereunder. 

            7.3        Upon fourteen (14) days prior written notice to Licensee, Owner, or a certified public accountant on Owner's behalf, shall have the right, once each year, during ordinary business hours, to inspect and audit such of Licensee's business books and records as may reasonably be necessary for Owner to verify the accuracy of any royalty statement ren­dered by Licensee within the eighteen (18) month period immediately preceding the date of the inspection. The information contained in a royalty statement shall be conclusively deemed correct and binding upon Owner, resulting in the loss of all further audit rights with respect to such statement, unless specifically challenged by written notice from Owner within eighteen (18) months from the date such royalty statement was delivered by Licensee. Owner and its auditor shall keep all information learned as a result of such audit in strict confidence. The cost of such an audit will be borne by Owner unless a material discrepancy indicating inadequate record keeping or that additional license fees are due to Licensee is discovered, in which case the reasonable cost of the audit, and related rea­sonable legal expenses, shall be borne by Licensee. A discrepancy shall be deemed material if it involves payment or adjustment of more than fifteen percent (15%) of payments due under this Agreement. Audits shall not interfere unreasonably with Licensee business activities.

            7.4        Severability. In the event that any provision hereof is found invalid or unenforceable pursuant to judicial decree or decision, the remainder of this Agreement shall remain valid and enforceable according to its terms. Without limiting the generality of the foregoing, to the extent the provisions of any copyright federal or applicable Maryland state law regarding licenses for transmissions by interactive services is applicable to any of the grants of rights hereunder, such grant shall be exclusive for the maximum allowable period of exclusivity under such law.

7.5        Relationship. The relationship of Licensee and Owner established by this Agreement is of licensor and licensee, and nothing in this Agreement shall be construed: (1) to give either party the power to direct or control the daily activities of the other party, or (2) to constitute the parties as principal and agent, employer and employee, franchisor and franchisee, partners, joint ventures, co-owners, or otherwise as participants in a joint undertaking. Licensee and Owner understand and agree that neither party grants to the other the power or authority to make or give any agreement, statement, representation, warranty or other commitment on behalf of such party, or to enter into any contract or otherwise incur any liability or obligation, express or implied, on behalf of such party, or to transfer, release or waive any right, title or interest of such party.

            7.6       Binding Agreement. This Agreement shall be binding upon and inure to the benefit of each of the parties hereto and their respective legal successors and assigns, provided that any successor or assignee shall be bound by all the terms and conditions of this Agreement.

            7.7        Confidentiality of Agreement. Each of the parties to this Agreement warrants and agrees that neither it nor its counsel will disclose, disseminate, or cause to be disclosed the terms of this Agreement, except: (a) Insofar as disclosure is reasonably necessary to carry out and effectuate the terms of this Agreement; (b) Insofar as a party hereto is required by law to respond to any demand for information from any court, governmental entity, or governmental agency; (c) Insofar as disclosure is necessary to be made to a party's independent accountants for tax or audit purposes; and (d) Insofar as the parties may mutually agree in writing upon language to be contained in one or more press releases. 

            7.8        Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Maryland applicable to agreements between residents of Maryland wholly executed and wholly performed therein. Notwithstanding the foregoing, any dispute, argument or controversy arising under this Agreement in any way whatsoever shall be settled exclusively by arbitration under the rules of the American Arbitration Association. Any action or proceeding brought by either party against the other arising out of or related to such arbitration or otherwise related to this Agreement shall be brought only in a state or federal court of competent jurisdiction located in the County of Prince Georges, Maryland, and the parties hereby consent to the in persona jurisdiction and venue of said courts.  

            7.9       Notice. Unless otherwise specifically provided, all notices required or permitted by this Agreement shall be in writing and in English and may be delivered personally, or may be sent by cable, telex, facsimile or certified mail, return receipt requested, to the address set forth above.  Any notice shall be deemed to have been received as follows: (i) personal delivery, upon receipt; (ii) facsimile, twenty-four (24) hours after transmission; (iii) certified mail, three (3) business days after delivery to the United States postal authorities by the party serving notice. If notice is sent by facsimile, a confirming copy of the same shall be sent by mail to the same address. 

            7.10      Breach.  Neither party shall be in breach of this agreement unless the other shall provide a notice to such party in writing specifying the alleged breach and the other party shall fail to cure such breach within sixty (60) days thereafter. 

            7.11      Legal Advice. Each of the parties hereto represents that this Agreement has been carefully read and authorized by their officers, agents or other authorized representative and that they know and understand the contents hereof. Each of the parties has received independent legal advice from attorneys of his or its choice with respect to the preparation, review and advisability of executing this Agreement. 

            7.12      Entire Agreement. This Agreement constitutes the entire understanding and contract between the parties and supersedes any and all prior and contemporaneous, oral or written representations, communications, understandings and agreements between the parties with respect to the subject matter hereof, all of which representations, communications, understandings and agreements are hereby cancelled to the extent they are not specifically merged herein. The parties acknowledge and agree that neither of the parties is entering into this Agreement on the basis of any representations or promises not expressly contained herein. This is a merged and integrated agreement.

8.         REPRESENTATIONS AND WARRANTIES

            8.1        Owner. Owner represents and warrants (a) that Owner has all necessary authorization, corporate and otherwise, to enter into this Agreement and to fully perform the terms hereof; (b) that Owner has full and suffi­cient right to grant the rights and/or licenses granted to Licensee herein, (c) all necessary permissions for the recording and the licensing to Licensee hereunder of all Licensed Works have been obtained by Owner; (d) that the Licensed Works, or any trademark or trade name used by any applicable performers or Owner, and any other materials provided by Owner to Licensee hereunder, do not, and the exercise by Licensee of the rights and licenses granted hereunder shall not, in­fringe any patent, copyright, trademark or other intellectu­al property rights, including trade secrets, rights of publicity, privacy or similar rights of any third party, or in any way contravene any applicable statute, law, order, rule or regulation, nor has any claim (whether or not embodied in an action, past or present) of such infringement or contravention been threatened or asserted, and no such claim is pending, against a performer or Owner or (insofar as Owner is aware) against any entity from which a performer or Owner has obtained such rights; (e) each person or entity who has rendered any service or provided any materials in connection with, or has contributed in any way, to the making of the Licensed Works or the rights and licenses granted herein, has the right to grant such rights, render such services or furnish such materials; (f) all fees and other payments applicable to or resulting from the creation, recording, manufacture, duplication, and distribution of the Licensed Works, including, but not limited to, payments to performers, producers, engineers and others, have been, and hereafter during the term hereof shall be, fully and completely paid by Owner to, or waived in writing by, every person entitled to such payment, except for fees and other payments expressly required hereunder to be made by Licensee.