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The Dish: Analysis of the CD Baby Digital Distribution Agreement (Parts I & II)
Posted on Sunday, August 24 @ 05:45:15 MDT by roadrash
 MD NewsAfter reading Moses Avalon¹s critique of the CD Baby Digital Distribution Contract on August 12th, and fielding questions from an artist at the conference on the evening of August 14th about the controversy, I decided to independently analyze the contract as if I was providing advice to a client and present it at my panel on the 15th.

Analysis of the CD Baby Digital Distribution Agreement; Part I
By Suzette Becker, MusicDish.com

Preface: My name is Suzette Becker. I am a New Orleans' entertainment attorney with a national client base, representing talent, independent labels and publishers and Internet music companies. Both Derek Sivers of CD Baby and Moses Avalon are professional acquaintances of mine; I do not represent either of them. I am speaking on a panel on Digital Distribution at the Cutting Edge Music Business Conference in New Orleans on August 15, 2003. After reading Moses Avalon's critique of the CD Baby Digital Distribution Contract on August 12th, and fielding questions from an artist at the conference on the evening of August 14th about the controversy, I decided to independently analyze the contract as if I was providing advice to a client and present it at my panel on the 15th.

Caveat: Since you and I do not have an attorney-client relationship, you are not to consider this as my providing legal advice to you. (Nothing personal, I HAVE to say that.) Below is the analysis:

What is the nature of this agreement? Basically, it is an agreement between the rights owners of a CD and CD Baby who will arrange for the CD to be distributed digitally. CD Baby will not digitally distribute the CD itself but instead can contract with digital "distributor/retailers" like iTunes, Rhapsody, eMusic, BuyMusic, MusicNet and PressPlay (The New Napster) to have the music distributed.

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Generally speaking, because you are not a major label you cannot go directly to one of those distributor/retailers yourself so CD Baby acts as an intermediate aggregator to provide you with access. Essentially you will be contracting with a distributor who will be contracting with a distributor/retailer. This is somewhat analogous to "two deep" distribution. Since there are two levels of distributors (a distributor and a "distributor/retailer"), both levels of distributors will need to be compensated before you get your money, but as you will see CD Baby's cut is in my opinion extremely reasonable.

CDBABY DIGITAL DISTRIBUTION AGREEMENT

This Agreement describes the legal relationship between you (an individual, representing yourself, or if applicable, acting as legal representative for a band, group, company or corporation) and Hit Media, Inc. d/b/a CD Baby (collectively with our licensees and assignees referred to in this Agreement as "CD BABY") the owner and operator of the web pages at "www.cdbaby.com" and "www.cdbaby.net" (the "CD BABY Site"). Hit Media, Inc. is a Nevada corporation with offices at 5925 NE 80th Ave, Portland, OR 97218-2891. You will be referred to as "RIGHTS HOLDER."

Please read this document carefully. By clicking on the "I AGREE" button, you will become a party to, and will be bound by this Agreement. If you do not agree with any of the terms and conditions of this Agreement, click on the "NO THANKS" button. We may modify this Agreement from time to time as further described in Section 8 below. The "Effective Date" of this Agreement is the date on which RIGHTS HOLDER clicks the "I AGREE" button.

The section identifies the parties. Nothing sinister should be read into the fact that Hit Media, Inc. is a Nevada corporation. Just as Delaware has favorable corporate laws, so does Nevada. Hit Media has every right to choose its domicile for a multitude of reasons.

Note that RIGHTSHOLDER is your new name for purposes of this Agreement. Note further that it means you are representing to CDBABY that you are in fact the rightful owner of the sound recording masters, the copyrights to those masters and the owner of the copyright to the underlying songs or at least the licensee of the compositions, meaning you must have either a contractual or statutory mechanical license, so if you are singing someone else's tunes be aware of this. CDBABY will rely upon your representations.

Clearly I am not crazy about the fact that CDBABY can modify the agreement at any time, but having drafted Internet music contracts myself I know that this is a very desirable right for an Internet music site to have as this area of music business practices and the law is in such a state of flux that the contract needs to be flexible. You have to have a certain amount of trust in the business practices of CDBABY. (If you don't have that basic sense of trust then just click the "No Thanks" button below and choose not to do business with them.) If you don't like the changes CDBABY makes, you can terminate the contract by giving them thirty (30) days written notice. I would like to see the termination procedure outlined more clearly in the Termination section and not just located in the Definition of Term.

1. Definitions.

The following terms shall have the following meanings for purposes of this Agreement:

a. "Digital Master" or "Digital Masters" means copies of RIGHTS HOLDER Content in digital form, which CD BABY may sell or authorize Distributors to sell via permanent digital download, streams or burns, as individual tracks or as a whole album, pursuant to the terms and conditions of this Agreement.

First look at the definition in "e" to learn that Rights Holder's Content "means sound recordings and underlying musical compositions" that you have provided to CD Baby to be digitally distributed. Then you can see that Digital Master is a digital form of the sound recording and underlying composition that you are authorizing CD Baby to sell as a download, stream or burn.

b. "Distributor" means any third party, such as Apple iTunes, that CD Baby may authorize to carry out the marketing, distribution and sale or other use of the Digital Masters pursuant to the terms of this Agreement.

CD Baby is telling you it will make agreements with "one deep" distributor/retailers. I don't like the vagueness of the "or other use" language.

c. "Term" means the period beginning on the Effective Date of this Agreement and ending on the first day of the second calendar quarter following the third anniversary of the Effective Date, after which such Term shall automatically renew for successive one-year periods. RIGHTS HOLDER may terminate this Agreement at any time by providing CD BABY with thirty (30) days' written notice of RIGHTS HOLDER's intention to terminate.

This is too complicated to figure out without mapping calendar software, if there is such a thing!!!! I guess CD Baby is trying to achieve some uniformity of the Term periods for these agreements for their accounting and I can't blame them. What I think it means is the Term will be three years plus the time it takes to get from the calendar date you click on "I agree" to the first day of April. SoŠ.Šif I click on "I agree" on August 15, 2003, the Term will end on April 1, 2007. Then it will renew from April through March of each year.

d. "Territory" means the Universe.

Worldwide, remember it's the Internet. In spite of that I have seen "geographical" limitations based on language. While this works for Japanese, it is harder to make it work in English.

e. "RIGHTS HOLDER Content" means sound recordings and underlying musical compositions that RIGHTS HOLDER has made available to CD Baby either before or during the Term for sale on the CD Baby Site that Artist has designated for digital distribution in accordance with this Agreement. Any sound recordings and the underlying musical compositions that are provided by or on behalf of RIGHTS HOLDER to CD BABY must be owned or controlled by RIGHTS HOLDER and/or have been cleared by RIGHTS HOLDER.

CD Baby is ascertaining that you have rights to both the sound recording and the underlying compositions. It is important to recognize that CD Baby and companies like iTunes are impliedly taking the legal position that they are distributors. Were they to be legally considered manufacturers instead of distributors, then consequently they would obtain the master use licenses and mechanical licenses themselves, instead this way they can rely on the record labels to ascertain and secure the rights, then pay the music publishers and other rights holders.

f. "CD Baby Site" means the retail website owned by CD BABY at www.cdbaby.com and www.cdbaby.net where RIGHTS HOLDER has registered to sell CDs through CD BABY according to the terms thereon. By agreeing to this Agreement, any sound recordings made available on the CD Baby Site that Artist designates will be made available for digital distribution by CD BABY and its Distributors according to the terms of this Agreement.

g. "Artwork" means album cover artwork and any other artwork relating to RIGHTS HOLDER Content that RIGHTS HOLDER provides to CD BABY. Any artwork that is provided by or on behalf of RIGHTS HOLDER to CD BABY before or during the Term will be deemed to have been cleared by RIGHTS HOLDER unless RIGHTS HOLDER promptly notifies CD BABY in writing to the contrary.

Remember music is not the only type of human creation that is subject to copyright. Visual artists have copyrights too. Before uploading cover art, text, artwork, photographs, etc. make certain you have the right or license to do so.

2. Authorization.

a. Subject to the terms of this Agreement, RIGHTS HOLDER hereby appoints CD BABY as RIGHTS HOLDER's exclusive authorized representative for the sale and other distribution of Digital Masters. Accordingly, RIGHTS HOLDER hereby grants an exclusive right to CD BABY, during the Term, to:

This is an EXCLUSIVE agreement for the sale and other distribution of the Digital Masters throughout the world. (Again, "other distribution" should be better defined.) This could mean you cannot sign up with another digital distributor like The Orchard or maybe even your local internet radio station that might be selling downloads, or for that matter your own site or your friend's site that is giving downloads and streams away. Let's look at the definitions: Digital Masters means copies of your sound recordings and underlying musical compositions in digital form.

So I have a problem with this and accordingly "i-v" below as far as the exclusivity nature goes. I would suggest that this Agreement with CD Baby be EXCLUSIVE vis a vis the named One Deep distributor/retailers that CD Baby should name in the agreement and specifically in "vi" so long as those named distributor/retailers s are actually making the digital files of Artist available for distribution and I would give CD Baby the right to amend the names from time to time. That way you can sell downloads from your local Internet radio station, your own site, etc. And remember you always have the right to terminate this agreement upon 30 days notice, but that language needs to made more prominent as recommended.

I do not see where Moses Supposes that CD Baby keeps the digital distribution rights even after the contract is terminated. If it were to be pointed out to me, I would be willing to further comment. In any case, have no fear that this agreement with CD Baby would prevent you from signing a major label contract. I'll even wager that Derek would put that in writing.

i. reproduce and convert RIGHTS HOLDER Content delivered by RIGHTS HOLDER into Digital Masters;

ii. perform and make thirty (30) second clips of the RIGHTS HOLDER Content available by streaming ("Clips") to promote the sale and distribution of applicable Digital Masters;

iii. promote, sell, distribute, and electronically fulfill and deliver Digital Masters, as individual tracks or entire albums, and associated metadata to purchasers who may use such Digital Masters in accordance with usage rules similar to those set forth in Exhibit A;

iv. display and electronically fulfill and deliver Artwork for personal use solely in conjunction with the applicable purchased Digital Master;

v. use RIGHTS HOLDER Content, Artwork and metadata as may be reasonably necessary or desirable for CD BABY to exercise CD BABY's rights under the terms of this Agreement; and

vi. authorize or appoint any Distributors to perform the activities in (i)-(v)above.

b. CD BABY shall also be authorized, if required by a Distributor, to provide one compact disc of RIGHTS HOLDER Content to Distributors free of charge, and no payment to RIGHTS HOLDER shall be required under this or any other agreement or understanding. CD BABY and its Distributors shall not be authorized to exploit RIGHTS HOLDER Content or Artwork in any manner or form not expressly authorized herein. Nothing herein shall obligate CD BABY or any Distributor to actually exercise any rights granted under this Agreement.

No problem with b. above but note that just because you submit your CD for digital distribution, does not mean it will be offered for distribution. That is a chance you take. I don't know why Moses is supposing that CD Baby could sell the actual CDs to brick and mortar stores. If it is in this paragraph 2, I don't see it.

3. RIGHTS HOLDER Obligations.

. RIGHTS HOLDER shall obtain and pay for any necessary clearances and licenses in the Territory for all RIGHTS HOLDER Content and Artwork. Specifically, RIGHTS HOLDER shall be responsible for and timely pay (i) any royalties and other income due to artists, authors, co-authors, copyright owners, co-copyright owners, producers and other record royalty participants from sales or other uses of Digital Masters, (ii) all mechanical royalties payable to publishers and/or authors or co-authors of copyrighted musical compositions embodied in Digital Masters from sales or other uses of Digital Masters, (iii) all payments that may be required under collective bargaining agreements applicable to RIGHTS HOLDER or third parties other than CD BABY, and (iv) any other royalties, fees and/or sums payable with respect to the RIGHTS HOLDER Content, Artwork, metadata and other materials provided by RIGHTS HOLDER to CD BABY.

This is the same thing we addressed above in the Identification of parties initial paragraph. Clearing all rights is your responsibility, as it should be even if this was a physical CD distribution. Musing: What about the responsibility for compensation for public performance royalties that the societies might claim for streaming and/or downloading? This is an example of how unsettled this area is and why CD Baby needs the right to amend this Agreement.

a. If there is a change of circumstance during the Term as a result of which RIGHTS HOLDER reasonably believes that it does not have, or no longer has, the rights necessary to authorize CD BABY and any Distributors to use any RIGHTS HOLDER Content or Artwork as provided for herein, or RIGHTS HOLDER reasonably believes that CD BABY's or its Distributors" continued sale or other use of any RIGHTS HOLDER Content or Artwork will substantially harm RIGHTS HOLDER's relations, or violates the terms of any of RIGHTS HOLDER's agreements, with any applicable copyright owner, artist, producer or distributor, then RIGHTS HOLDER shall have the right to withdraw, upon written notice to CD BABY, authorization for the sale or other use of such RIGHTS HOLDER Content or Artwork.

Following such withdrawal, CD BABY shall cease to offer such RIGHTS HOLDER Content or Artwork for sale or other use or cause such cessation as soon as is commercially feasible after CD BABY's receipt of such notice of withdrawal, and RIGHTS HOLDER shall use commercially reasonable efforts to clear such withdrawn RIGHTS HOLDER Content or Artwork and shall promptly notify CD BABY if and when such RIGHTS HOLDER Content has been cleared and is again authorized for use or sale by CD BABY and its Distributors. RIGHTS HOLDER shall not withdraw RIGHTS HOLDER Content if such RIGHTS HOLDER Content is being made available or is intended to be made available by RIGHTS HOLDER to any other provider of digital downloads, streams or burns.

Once again, be certain that you have cleared the rights and are authorized to enter into this agreement. If you realize that you have not obtained the proper licenses, for goodness sakes, alert CD Baby immediately so you can stop the infringement. Moses Supposes that there is a bias against urban music. Unfair hurl. What there would be a "bias" against, if there is any "bias" at all, is a "bias" against copyright infringement regardless of the genre of music. The last sentence is there just to dissuade you from jumping ship to a competitor of CD Baby's. Since you can terminate with 30 days notice for any reason, it really has no bite.

Provided by the MusicDish Network. Copyright © Tag It 2003 - Republished with Permission



Analysis of the CD Baby Digital Distribution Agreement; Part II
By Suzette Becker, MusicDish.com

4. Payment.

a. CD BABY shall pay RIGHTS HOLDER ninety-one percent (91%) of the amount that CD BABY receives from Distributors for the sale or other use of RIGHTS HOLDER's Digital Masters. CD BABY will compute amounts payable to RIGHTS HOLDER after the end of each calendar month during the Term, and will provide a statement to Artist in accordance with CD Baby's standard business practices. CD BABY shall make payment to RIGHTS HOLDER only at such times that amounts owed to RIGHTS HOLDER exceed the threshold amount set by RIGHTS HOLDER upon registration with the CD BABY Site. Such payment shall constitute full consideration for all rights granted and obligations undertaken by RIGHTS HOLDER hereunder.

I like this split of 9% to CD Baby and 91% to you, but be sure you understand that since this is a two deep distribution, the first split will be between the one deep distributor/retailer and CD Baby, then between CD Baby and you. Here is just an example of how it might work: Download sells for 99 cents. iTunes gives CDBaby 49 cents and keeps 50 cents for iTunes. CD Baby then splits the 49 cents as follows: 45 cents to you (assuming a rounding up) and 4 cents to CD Baby or 44 cents to you and 5 cents to CD Baby (assuming no rounding up.)

b. Artist shall pay CD BABY a one-time, non-refundable fee of $40.00 to cover the cost to convert the RIGHTS HOLDER Content into Digital Masters and otherwise prepare the Digital Masters for digital distribution.

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CD Baby has to cover the labor encoding and other costs. No refunds even if they don't choose, or iTunes or the other distributor/retailers do not choose to offer your music. Again, it is a chance you take. There are no guarantees in life.

How many tracks does this $40 cover? I.E. Is it the same price for one album as it is for two albums?

5. Parental Advisory.

If RIGHTS HOLDER provides a parental advisory warning about a particular sound recording in the RIGHTS HOLDER Content, CD BABY shall use or forward such parental advisory information to Distributors. RIGHTS HOLDER shall be responsible for determining parental advisory warning status.

6. Names and Likenesses; Promotional Use and Opportunities.

a. CD BABY may use and authorize its Distributors to use the names and likenesses of, and biographical material concerning, any Digital Master, artists, bands, producers and/or songwriters, as well as track and/or album name, and Artwork, in any marketing materials for the sale, promotion and advertising of the applicable Digital Master which is offered for sale or other use under the terms of this Agreement (e.g., an artist or band name and likeness may be used in an informational fashion, such as textual displays or other informational passages, to identify and represent authorship, production credits, and performances of the applicable artist or band in connection with the authorized exploitation of applicable Digital Masters).

No problem. Isn't this the point of distribution, i.e. to get your name and music out there? So long as the use is limited to being in connection with the Digital Master, as it is. Same comment as before on the "or other use".

b. CD BABY and any of its Distributors shall have the unrestricted right to market, promote and advertise the Digital Masters available for purchase as it determines in its discretion. Without limiting the foregoing, CD BABY and any of its Distributors shall have the right to determine which sound recordings, irrespective of any particular artist, record company or label affiliation, would best further their commercial purposes, and to promote such sound recordings more than others.

Artist input would be nice at least as to the suggestion of choice of Artist's tracks to be made available for purchase.

As to the rest, it is their business to sell downloads and they will promote the ones that will sell.

7. Ownership.

As between the Parties, all right, title and interest in and to (i) the RIGHTS HOLDER Content, (ii) the Digital Masters, (iii) the Clips, (iv) all copyrights and equivalent rights embodied therein, and (v) all materials furnished by RIGHTS HOLDER, except as to any rights of CD BABY (whether pre-existing or under this Agreement), shall remain the property of RIGHTS HOLDER, it being understood that under no circumstances shall CD BABY have any lesser rights than it would have as a member of the public.

I am not familiar with the necessity to mention the member of the public's rights but regardless, as far as you care, you are keeping your copyrights and master ownership rights in everything as it should be. Further, this is interesting because CD Baby seems to be implying that if the agreement is terminated, you get to keep your digital master files and clips that were encoded by CD Baby. Sure you paid to encode them but they don't HAVE to be that nice, they just are being that nice.

I do not see any "grab" by CD Baby of the publishing as Moses Supposes. I am having a hard time seeing any ambiguity in this paragraph at all so as to provide food for Moses' speculation. And as far as rights potentially falling into probateŠ what could he be referring to? Probate is the opening of a deceased person's property estate and has nothing to do with Moses' fear that iTunes and CD Baby might find themselves in an acrimonious position. Even if a corporation were subject to probate, which it is not, (dissolution is another matter) this contract is subject to termination by you.

8. Modification, Termination and Effect of Termination.

a. CD BABY reserves the right, in its sole discretion, to change, modify, add or remove all or part of this Agreement. Notice of any amendments and/or modifications shall be sent to you by email prior to their effective date. In the event that you do not consent to any such amendments and/or modifications, your sole recourse shall be to terminate this Agreement.

b. Either party shall have the right to terminate this Agreement prior to the expiration of the Term in the event that the other party breaches any material representation, obligation or covenant contained herein, unless such breach is cured prospectively, no later than thirty (30) days from the date of receipt of written notice of such breach, or if not able to be so cured, then resolved to the other party's satisfaction, not to be unreasonably withheld.

. Sections 1, 3, 7, 8, 9, 10 and 11 shall remain in full force and effect following the expiration or earlier termination of this Agreement. The expiration or earlier termination of this Agreement shall not relieve RIGHTS HOLDER or CD BABY of their respective obligations to make any payments with respect to the sale or other use of Digital Masters in the periods prior to such expiration or termination (and the associated accounting) in accordance with this Agreement.

We already addressed why CD Baby needs flexibility whether you like it or not. I would really like to see this termination procedure featured more prominently so there will be no confusion. While certain sections do remain in force, such as warranties and obligations to pay you, etc. after termination, as you should expect, the right of CD Baby to continue to digital distribute your music does end upon termination, as you should expect.

9. Indemnification and Limitation of Liability.

a. RIGHTS HOLDER will indemnify and hold harmless, and upon CD BABY's request, defend, CD BABY and its Distributors and affiliates (and their respective directors, officers and employees) from and against any and all losses, liabilities, damages, costs or expenses (including reasonable attorneys' fees and costs) arising out of a claim by a third party by reason of: (i) a breach of any warranty, representation, covenant or obligation of RIGHTS HOLDER under this Agreement; or (ii) any claim that any Digital Master, sound recording or RIGHTS HOLDER Content, Artwork, metadata or any other materials provided or authorized by or on behalf of RIGHTS HOLDER hereunder or CD BABY's or its Distributors" use thereof violates or infringes the rights of another party.

RIGHTS HOLDER will reimburse CD BABY and its Distributors and affiliates on demand for any actual payments made in resolution of any liability or claim that is subject to indemnification under this Section 9, provided that CD BABY obtains RIGHTS HOLDER's written consent prior to making such payments, such consent not to be unreasonably withheld, delayed or conditioned. CD BABY shall promptly notify RIGHTS HOLDER of any such claim, and RIGHTS HOLDER may assume control of the defense of such claim. CD BABY shall have the right, at its expense, to participate in the defense thereof under RIGHTS HOLDER's direction.

Again, it is of the utmost importance that you have secured proper licenses. Don't fool around with this. Copyright infringement is a serious matter. You want to be credited and paid for your work otherwise you would not be signing up for digital distribution so do accord the same courtesies to others.

Making these provisions mutual is always better, but it won't happen here because this is non-negotiable via a click. Maybe CD Baby will consider changing it.

b. EXCEPT PURSUANT TO AN EXPRESS INDEMNITY OBLIGATION, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES, INCLUDING LOSS OF PROFITS OR PUNITIVE DAMAGES, EVEN IF ADVISED OF THEIR POSSIBILITY.

That first phrase "Except pursuant to an express indemnity obligation" should be deleted, so long as 9a. remains as is.

10. Additional Representations and Warranties of the Parties.

a. RIGHTS HOLDER represents and warrants that it has the full authority to act on behalf of any and all owners of any right, title and interest in and to the RIGHTS HOLDER Content.

b. 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.

c. 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.

d. 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.

e. Each party represents and warrants that it shall perform in compliance with any applicable laws, rules and regulations of any governmental authority.

A lot of this is redundant but that is just a matter of repetitive, rather than concise contract drafting. As far as you are concerned, if you are not breaching another agreement by entering into this one and if you have the RIGHTS CLEARED and did not steal the masters, you can pretty much have a clear conscience!

11. General Provisions.

a. No Agency or Joint Venture. The parties agree and acknowledge that the relationship between the parties is that of independent contractors. This Agreement shall not be deemed to create a partnership or joint venture, and neither party is the other's agent, partner, employee, or representative.

b. Entire Agreement, Modification, Waiver. This Agreement, including any annexes, schedules and exhibits hereto, contains the entire understanding of the parties relating to the subject matter hereof, and supersedes all previous agreements or arrangements between the parties relating to the subject matter hereof. This Agreement cannot be changed or modified except by a writing signed by the parties. A waiver by either party 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. If any provision of this Agreement is determined by a court of competent jurisdiction to be unenforceable, such determination shall not affect any other provision hereof, and the unenforceable provision shall be replaced by an enforceable provision that most closely meets the commercial intent of the parties.

The signed writing is not going to happen by email, unless everyone is using digital signatures, but this is just inapplicable boilerplate ballast and a contract drafting issue.

b. Binding on Successors. This Agreement shall be binding on the assigns, heirs, executors, personal representatives, administrators, and successors (whether through merger, operation of law, or otherwise) of the parties.

a. Notices. Any notice, approval, request, authorization, direction or other communication under this Agreement shall be given in writing and shall be deemed to have been delivered and given for all purposes: (i) on the delivery date if sent by electronic mail to the addresses provided to and by RIGHTS HOLDER upon registration with the CD Baby Site, or as properly updated.

b. Governing Law. This Agreement shall be governed and interpreted in accordance with the internal laws of the State of California applicable to agreements entered into and wholly to be performed therein, without regard to principles of conflict of laws.

c. Remedies. To the extent permitted by applicable law, the rights and remedies of the parties provided under this Agreement are cumulative and in addition to any other rights and remedies of the parties at law or equity.

d. Headings. The titles used in this Agreement are for convenience only and are not to be considered in construing or interpreting the Agreement.

e. No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their authorized successors and permitted assigns. Nothing herein, express or implied, is intended to or shall confer upon any person or entity, other than the parties hereto and their authorized successors and permitted assigns, any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

f. Force Majeure. For the purposes of this Agreement, "Force Majeure" shall mean any event which a party hereto could not foresee, such as fire, flood, acts of God or public enemy, Internet failures, earthquakes, governmental or court order, national emergency, strikes or labor disputes, the effect of which it could not reasonably prevent or predict and which renders impossible or impractical the performance of contractual obligations either totally or in part. The party invoking a Force Majeure shall notify the other party within three (3) business days of its occurrence by accurately describing all the circumstances of the situation involved and its effect upon the performance of its contractual obligations.

The taking place of a Force Majeure shall have the effect of suspending the obligations of the party which has invoked the provisions of this Section to the extent such obligations are affected by the Force Majeure. Contractual dates shall be extended for a period equal to the duration of a Force Majeure. The cessation of a Force Majeure shall be communicated by notice within three (3) business days of its occurrence by the party that invoked it.

EXHIBIT A

Usage Rules

End users obtaining Digital Masters from Distributors may:

1. Burn single-track Digital Masters an unlimited number of times to a CD as part of a playlist.

2. Use Digital Masters in applications such as QuickTime.

3. Store Digital Masters on up to five (5) computers at the same time.

4. Subject to Paragraph 3 above, transfer Digital Masters to, and/or render from, a device.

5. Use Digital Masters solely for end user's personal use

FOR REFERENCE ONLY

This is a printable copy of our contract for reference only. This is not a binding agreement until you log in to your CD Baby Members login area at https://members.cdbaby.com with your username and password, then follow the prompts for Digital Distribution to agree to this Agreement, and then pay the setup fee to start.

Provided by the MusicDish Network. Copyright © Tag It 2003 - Republished with Permission

 

 
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