This is an agreement between the owner of a master recording and a licensee that wishes to use the master recording on an album. The agreement sets forth the terms and condition of the license, including an advance, royalties, accounting provisions, term of the agreement, and other material deal points. This document in its draft form contains numerous of the standard clauses commonly used in these types of agreements, as well as optional language to allow for customization to ensure the specific terms of the parties’ agreement are addressed.
Master Recording License This is an agreement between the owner of a master recording and a licensee that wishes to use the master recording on an album. The agreement sets forth the terms and condition of the license, including an advance, royalties, accounting provisions, term of the agreement, and other material deal points. This document in its draft form contains numerous of the standard clauses commonly used in these types of agreements, as well as optional language to allow for customization to ensure the specific terms of the parties’ agreement are addressed. MASTER RECORDING LICENSE AGREEMENT THIS MASTER RECORDING LICENSE AGREEMENT (the “Agreement”), is made as of ___________ [Instruction: Insert Date], by and between ___________ [Instruction: Insert Name of Licensor], located at ___________ [Instruction: Insert Address] (“Licensor”) and ___________ [Instruction: Insert Name of Licensee], located at ___________ [Instruction: Insert Address] (“Licensee”). WHEREAS, Licensee desires to reproduce, distribute, exhibit, perform, use and otherwise exploit a certain master recording (the “Master”) embodying the performance of “___________” [Instruction: Insert Composition Title] (the “Composition”) as performed by ___________ [Instruction: Insert Artist] (the “Artist”), on the album tentatively entitled “___________” [Instruction: Insert Selection Title] (the “Album”), along with approximately ___________ (___) [Instruction: Insert Number] other master recordings, which Album is tentatively scheduled for initial U.S. release by Licensee on ___________ [Instruction: Insert Release Date] (the “Release Date”); WHEREAS, Licensor is sole and exclusive owner of the Master and desires to license the Master to Licensee, subject to the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the promises and other good and valuable consideration set forth, the parties agree as follows: 1. Grant of Rights. Licensor: A. Grants to Licensee the non-exclusive right to manufacture, reproduce, distribute, exhibit, perform, use and otherwise exploit the Master in the Album for a period of five (5) years (the “Term”), throughout the Universe (the “Territory”), along with the right to use Licensor's and/or the Artist’s name, likeness, and/or biographical material for purposes of advertising and trade in connection with the Album; B. Will furnish to Licensee simultaneously with execution hereof: (i) complete and correct publishing information with respect to the Composition, (ii) the complete and correct copyright notice for the Master, and (iii) the text of any courtesy credit required by Licensor; and C. Reserves to itself, all rights whatsoever in and to the Master, other than those rights expressly granted Licensee herein, it being understood that the rights hereby granted shall be non-exclusive and shall not include the right to manufacture any records, other than the Album, that include the Master. 2. Compensation. A. Advance. Promptly following the complete execution hereof, Licensee shall pay to Licensor a non-returnable advance of ___________ Dollars ($_____) [Instruction: Insert Amount] (the “Advance”). The Advance shall be deemed a non-returnable advance recoupable from and chargeable against any and all record royalties payable to Licensor pursuant to this agreement. B. Record Royalties. Licensee will credit Licensor’s account a record royalty (“Record Royalty”) as follows. i. With respect to net sales of the Album, through normal retail channels in the United States, in any medium, a royalty of ___________ Cents ($0.__) per unit. ii. With respect to net sales of the Album through normal retail channels outside the United States, a royalty equal to seventy percent (70%) of the amounts specified in paragraph 2(B)(i). iii. With respect to net sales of the Album outside normal retail channels, a per-unit royalty equal to fifty percent (50%) of the applicable amount specified in paragraphs 2(B)(i) or 2(B)(ii). C. Most Favored Nations. Licensee agrees that the royalties payable hereunder shall be no less favorable to Licensor than the royalties payable to any other licensor of master recordings included in the Album. 3. Record Royalty Accounting. Licensee shall render to Licensor semi-annual statements, and payments therefore (subject to recoupment of the Advance), of all royalties payable hereunder within ninety (90) days after the last day of June and December, for each semi-annual period for which any such royalties accrue pursuant to the terms hereof. The statements rendered by Licensee to Licensor hereunder shall set forth in reasonable detail the following items: (i) the name of the Master; (ii) the configurations of the Album; (iii) the royalty rate; and (iv) such other information as shall be reasonably necessary for Licensor to properly analyze such statements. All royalty statements and all other accountings rendered by Licensee to Licensor shall be binding upon Licensor and not subject to any objection by Licensor for any reason unless specific objection in writing, stating the basis thereof, is given to Licensee within two (2) years from the date received by Licensor. Licensor will not have the right to sue Licensee in connection with any royalty accounting hereunder unless such suit is commenced within two (2) years after the statement in question is received by Licensor. Licensee shall maintain complete and accurate books and records of all transactions relating to the subject matter hereof. Licensor shall have the right, upon reasonable notice to Licensee, to audit such books and records and to make extracts and copies thereof, for the purpose of determining the accuracy of royalty statements and payments, not more than once during any calendar year, and only once with respect to any statement rendered hereunder. 4. Third Party Obligations A. The royalty specified herein shall be comprehensive, and Licensor shall be responsible for any royalties or other sums which may become due and payable, as a result of Licensee's exercise of its rights hereunder, to the Artist, to any producer(s) or other person(s) who rendered services in connection with the Master, and, except specifically provided in this paragraph 4, to any third parties whatsoever. B. Notwithstanding the foregoing, Licensee shall be responsible for the payment of mechanical royalties with respect to the Composition as embodied on the Album, and for any amounts which may become due and payable to any union or union trust fund having rights in the premises. C. Except as provided in paragraph 4(D), the maximum mechanical royalty payable with respect to the Composition shall be an amount equal to seventy-five (75%) percent of the minimum compulsory license rate (without regard to playing time) applicable as of the date of this Agreement under the U.S. copyright law, and seventy-five (75%) percent of the lowest prevailing mechanical royalty rate prevailing in Canada as of the date of this Agreement. D. In the event that Licensee is required to pay any mechanical royalty with respect to the Composition in excess of the foregoing, then such excess may be deducted from Record Royalties otherwise accruing pursuant to paragraph 2(B), unless Composition is a so-called non- controlled composition and neither the Artist, nor Licensor, nor any affiliate of Licensor, is the author or co-author or publisher or co-publisher of the Composition, or the administrator or co- administrator of the copyright therein; in which case the full statutory rate will be paid to the owner of the Composition and said excess will not be deducted from Licensor’s Record Royalties. 5. Sell Off. For a period of six (6) months following the termination of the Term, Licensee shall have the right to continue to sell Albums manufactured during the Term, subject to its royalty obligations hereunder. Licensee shall not manufacture excessive quantities of Albums in anticipation of the expiration of the Term. 6. Representations, Warranties, Indemnification and Limitation of Remedies A. Licensor represents and warrants that: (i) Licensor owns and controls one hundred percent (100%) of all copyrights in and to the Master throughout the universe; (ii) neither the Master nor anything contained in the Master will violate the rights of any third party; and (iii) Licensor has the exclusive and sole right to enter into this Agreement and grant the rights granted herein. B. Except as expressly set forth herein, Licensee shall not be required to make any payment to any person or entity in connection with any use of the Master hereunder. If any of the agreements, representations or warranties contained in this Agreement are breached, in whole or in part, Licensor shall indemnify and hold Licensee harmless from any and all damages, losses and costs (including, but not limited to, legal costs and attorneys' fees) resulting from any and all claims inconsistent with such agreements, representations or warranties. Without limiting any right or remedy otherwise available to Licensee, in the event of any such claim, Licensee shall have the right to withhold from any monies payable hereunder an amount reasonably related to such claim, including but not limited to anticipated legal fees and costs. C. In no event shall Licensor be entitled to seek injunctive or any other equitable relief for any breach or non-compliance with any provision of this Agreement. Notwithstanding the foregoing, Licensor retains the right to sue for any breach by Licensee of this Agreement but Licensor shall not be entitled to hinder release of the Album. 7. Miscellaneous. A. No failure by either party to perform any of its material obligations hereunder shall be deemed a breach hereof, unless the non-breaching party has given written notice of such failure to the breaching party, and the breaching party fails to cure such non-performance within thirty (30) days after receipt of such notice (fifteen (15) days with respect to non-payment). B. All notices shall be given in writing by addressing the same to the addresses mentioned above, or at such other address as may be designated, in writing, in a notice to the other party. C. This Agreement is binding upon and shall inure to the benefit of the respective successors, licensees and/or assigns of the parties hereto. Any or all of the rights granted to Licensee hereunder shall be exercisable by any assignee, licensee or designee of Licensee, and all succeeding assignees, licensees or designees. This Agreement shall not be deemed to give any right or remedy to any third party whatsoever, unless said right or remedy is specifically granted in writing to said third party. D. This Agreement is an entire document and supersedes any and all other agreements, either oral or in writing, between the parties hereto. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, it will be severed from it and the remaining provisions shall nevertheless continue in full force and effect without being impaired or invalidated in any way. E. This Agreement may only be amended or modified, in whole or in part, by an instrument in writing signed by all parties hereto. F. Any waiver by any party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach of the same or any other provision hereof. G. This Agreement shall be construed in accordance with and governed for all purposes by the laws of the State of __________ [Instruction: Insert State], applicable to contracts executed and wholly performed therein. The parties herein agree to submit to the personal jurisdiction and venue of federal and state courts located in ________ County [Instruction: Insert County], State of ______________ [Instruction: Insert State]. IN WITNESS WHEREOF the parties have duly executed this Agreement as of the date first written above. LICENSEE: ________________________________ [Instruction: sign] By: ___________________________ [Instruction: Insert Name of Signatory] Title: ___________________________ [Instruction: Insert Title of Signatory] LICENSOR: ________________________________ [Instruction: sign] By: ___________________________ [Instruction: Insert Name of Signatory] Title: ___________________________ [Instruction: Insert Title of Signatory]
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