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AudioSparx Vendor Licensing Agreement
Parties to Agreement – This is a legal agreement between you (hereinafter known as "You" or "Licensor") and AudioSparx, a division of Navarr Enterprises, Inc. (hereinafter known as "AudioSparx" or "Licensee") to provide Licensor's audio content for sale and commercial utilization at the AudioSparx.com, RadioSparx.com, and various other web sites operated by Licensee.
Recorded Content – You hereby warrant and represent that you are the sole and exclusive owner and publisher of all rights, including valid copyright, in the sound recordings and, if applicable, the underlying musical compositions as recorded which will be provided to Licensee (hereinafter to be referred to as the "Works"), or that you fully control the publishing of the Works and are authorized by the copyright holder(s) to publish the Works at AudioSparx.com for sub-licensing to clients of Licensee for commercial uses. At all times Licensor shall retain full ownership of their Works.
Grant of Rights - Licensor grants to AudioSparx a perpetual, non-exclusive, and assignable right to represent, market, sub-license, and distribute to clients on a worldwide basis the Works for all types of commercial and consumer uses, for the financial benefit of Licensor, including but not limited to TV shows, films, commercials, games, multimedia projects, theatrical productions, royalty-free commercial music service (hereafter "CMS uses", also known variously as "environmental music", or "in-store music"), ringtones, digital downloads, etc. and to grant to clients various rights as necessary including, but not limited to, master use rights, synchronization rights, mechanical rights, streaming rights, public performance rights, duplication rights, and related rights (also known as "neighboring rights"). Further, Licensor grants to AudioSparx the right to represent, market, sub-license and distribute on a worldwide basis the Works to distributors, sub-publishers, marketing agents, resellers, and channel partners (collectively hereafter "Distributors") for further sub-licensing and distribution to their clients under the same or similar terms of this license agreement, for all of the same types of commercial and consumer uses mentioned above, for the benefit of Licensor.
Sole Discretion and Restrictions
Licensee reserves the right to reject any artist or track in its sole discretion. Additionally, Licensee does not accept any Works which are participating in any kind of "music fingerprinting", "ad share", "ad royalties", or similar music monetization systems such as the following:
- YouTube's Content ID program
- GoDigital Media Group's AdShare program
- Rumblefish monetization at YouTube (either directly or via CD Baby)
- Any other similar "fingerprint-based" music monetization systems at YouTube, FaceBook, MySpace, Imeem and other social media sites
Participation in these kinds of programs can prevent clients who have duly licensed Works from AudioSparx from being able to monetize their own video content as they are properly entitled to do so.
Additionally, in order to help our artist community from having their music devalued and avoid a "race to the bottom" pricing mentality, Licensee disallows Licensor's participation for any Works to be sold at AudioSparx from being offered for license at "bargain basement pricing" stock audio sites including the following:
- Oak Stock Music Production
For any new artists commencing with AudioSparx on or after June 22, 2010, participation of any of your Works for sale at AudioSparx in any of these external monetization programs or web sites shall be considered an actionable breach of contract.
Internal Licensing Operations - Internal licensing sales shall occur via the AudioSparx.com web site as well as via other optional internally-operated web sites including RadioSparx.com, StockMusicSite.com, CustomLabelMusic.com and MusicCult.com, as well as any custom-branded instances of these sites (hereafter the "Sites"). This license agreement shall govern Licensor's participation within all the Sites.
Artist Application and Works - Licensor agrees to submit a new Artist Application (hereafter the "Application") for each individual artist that Licensor desires to upload and market Works for at the Sites. AudioSparx shall review each Application and in its sole and exclusive discretion may accept or reject any individual Application. When an artist is accepted by AudioSparx to participate on the Sites, if at any time AudioSparx determines that the Works being uploaded by Licensor for the artist seem unprofessional, substandard, offensive or otherwise unacceptable, AudioSparx reserves the right in its sole and exclusive discretion to delete individual tracks or completely terminate any individual artist and remove that artist’s content from our Sites. Any pending or future earnings that may exist will of course be paid to Licensor during the standard commission payment cycles.
Limited Opt-Out Window - For any new artist that is accepted to participate on the Sites, the artist shall be automatically opted-in to participate in all eligible internally-operated sites and all external distribution opportunities. Within the first 10 days in which the new artist is activated, Licensor may choose to opt-out of some of these sites and opportunities by simply disabling those options from the Artist Properties page at the AudioSparx web site. If Licensor does not opt-out within 10 days, then that artist and that artist's Works shall not be eligible to opt-out of any site or distribution opportunity after that time, except at the sole discretion of AudioSparx.
Pricing - Licensee shall assign an initial price to the Works during the track upload process, which may be modified by Licensor as appropriate. AudioSparx may on occasion discount the pricing by a reasonable amount for individual licensing transactions as appropriate and/or necessary in order to close custom-negotiated deals. AudioSparx reserves the right to adjust pricing for your tracks if you price your tracks too high or too low, substantially outside the range of standard market rates for the industries served by AudioSparx.
Compensation - AudioSparx shall pay to Licensor 40% of gross licensing revenue attributable to the licensing of the Works by clients and Distributors. This shall apply to all revenue earned internally, via license sales to clients, as well as to any revenue earned externally via any external opportunities.
Term - The Term of this license is perpetual (i.e. forever). For clarification, any Works uploaded to the AudioSparx web site shall be considered to be perpetually licensed to AudioSparx and shall not be eligible for removal or take-down, subject to the conditions in the following paragraph. By way of explanation, a perpetual license is essential to providing for a stable shopping experience for our clients, and the continual availability of the Works on the AudioSparx site avoids a client selecting a track and returning to license it only to find it has
disappeared from the site unexpectedly. Further, various clients and Distributors that AudioSparx works with to make available the AudioSparx music library for their production usage require a perpetual license, hence take-downs are counter-productive to maintaining and establishing such long-term relationships.
Disabling or Deleting Tracks - In general, take-downs are prohibited and disallowed. Take-downs are disruptive to business and to our clients, and hence unless there is a compelling reason for any track to be deleted or withdrawn, take-down requests will generally be denied. Any individual track take-downs or removals are at the sole and exclusive discretion of Licensee. For clarification, Licensor may request that any individual track be disabled for sale, or deleted from the Sites, or withdrawn from any external distribution, however such take-downs, deletions and/or withdrawals are granted on a case-by-case basis at the sole and exclusive discretion of Licensee, and may be denied. Further, tracks that have been exported for external distribution to any of the various deals Licensee is involved in and which Licensor has elected to participate in cannot ever be taken down or withdrawn, they will remain in the deals in perpetuity, earning revenue for Licensor in perpetuity.
External Distributions - Licensor may choose to participate in various external distribution opportunities that Licensee makes available to its vendors. At the commencement of this agreement, and as Licensor adds new artists to this agreement, each new artist will be automatically opted-in to participate in most of the available external distribution opportunities (some opportunities are opt-in required). Within the first 30 days of adding a new artist to the site, Licensor may choose to opt-out of any or all external distribution opportunities. After the first 30 days have passed, any further opt-outs shall be at the sole discretion of Licensee. For any tracks that are externally distributed, such distributions are permanent and take downs are forever prohibited. For clarification, such external licensing activity for any of Licensor's tracks that have been distributed externally shall continue in perpetuity and takedowns shall be forever prohibited. Any revenue earned via external distribution licensing or sales shall be paid to Licensor in the calendar quarter following the quarter in which the revenue was received at AudioSparx.
Commissions Payments - Within 15 days after the end of each calendar quarter, Licensee shall email Licensor a quarterly royalty statement detailing each individual track sale and all other earned revenue. Once Licensor's accumulated royalties are equal or greater than $25.00, Licensee shall send payment to Licensor within 45 days after the end of each calendar quarter. Licensee requires Licensor to utilize a PayPal account to receive payment because payment can be issued by Licensee in a timely manner and avoids potential delays and problems that can occur with mailed checks (please visit www.PayPal.com to setup a free account). AudioSparx uses PayPal's MassPay service to make payments; for US-based vendors, you are not charged a transaction percentage or fee, by PayPal to receive payment in this way - you receive your full commission amount from AudioSparx with no offsets or withholds. For vendors outside the US, a fee of 2% (maximum $20) is deducted from your quarterly payment to cover the fee charged by PayPal to make international payments. For Licensors located in a country which does not accept PayPal payments, wire transfers may be used instead, however the payment threshold is $400 (instead of $25) and a $40 fee is charged to Vendor to cover the bank costs for Licensee to disburse payment via wire transfer.
Performance Royalty Earnings - Licensor specifically grants to Licensee the right to transact different types of licensing of Licensor's Works wherein Licensor shall earn performance royalties. This includes the royalty-based licensing of public performance rights through performing rights organizations (hereafter "PROs") such as ASCAP, BMI and others around the world (hereafter "Society Licensing"), as well as royalty-inclusive licensing (hereafter "Direct Licensing"), wherein clients and Distributors pay a combination of licensing fees and performance royalties directly to Licensee, for which Licensor automatically earns their respective share as outlined in the "Compensation" section above. These two different types of licensing activities are explained further below:
Society Licensing - This type of licensing is utilized for TV broadcast uses and radio commercial broadcast uses (hereafter collectively "Broadcast Uses"). Licensor shall be entitled to receive performance royalties for any eligible uses of their music tracks in Broadcast Uses. In order to participate in this type of earnings, Licensor's composer(s) must be registered at a PRO somewhere in the world. Performance royalties for Broadcast Uses are paid directly to Licensor's composers from PROs, not from Licensee. AudioSparx requires that clients licensing music Works for Broadcast Uses provide cue sheet information to AudioSparx or to Licensor's designated publishing administrator so that cue sheets may be filed as appropriate to facilitate payment of all performance royalties. AudioSparx provides an optional opt-in publishing administration service to handle the process of registering your tracks with the PROs, collecting cue sheet information from clients, filing cue sheets and more, which is all covered under a separate opt-in Publishing Administration license agreement.
Direct Licensing - Licensor specifically consents to permit AudioSparx, at its own discretion, to enter into Direct Licensing agreements with clients and Distributors on a worldwide basis for the purpose of licensing the public performance rights for Licensor's Works. For this type of licensing activity, Licensor shall earn licensing fees and performance royalties via direct payments from clients and Distributors to AudioSparx. Licensor warrants to AudioSparx that this consent shall not conflict with any prior licensing agreements to which Licensor's composers may be engaged.
Works may be used for marketing and promotional purposes - Licensee may, in its sole discretion and without compensation to Licensor, utilize the Works to advertise and promote the Sites and the Works for the purposes of raising public awareness of the Sites and/or the Works themselves, to attract clients to visit the Sites to license the Works or close new licensing deals of any kind.
Confidentiality - All communications between Licensor and Licensee (and any staff members at Licensee) will be held in strict confidence at all times. Further, all information available in the AudioSparx Knowledge Base shall be deemed to be privileged information also to be held in strict confidence at all times. You recognize that any breach or disclosure of confidential information to unauthorized parties will result in irreparable injury to Licensee and that monetary damages alone will be an inadequate remedy in such case, and receiver therefore agrees that Licensee may, if it so elects, institute and prosecute proceedings in any court of competent jurisdiction, either in law or in equity, to obtain damages for any breach of this agreement, or to enforce the specific performance of this agreement by you, or to restrain or enjoin you or any person associated with you from all activities in violation of this agreement. Licensee shall be entitled to recover any and all costs and expenses, including, without limitation, reasonable attorney’s fees in enforcing this agreement and the provisions of this agreement against receiver.
Disruptive Conduct - If Licensor engages in disruptive conduct such as destructive or malicious editing of track data or artist data, creating disruptive network activity or traffic, hacking, theft of digital content, or any other type of offensive, problematic, undesirable, harmful or destructive conduct, AudioSparx reserves the right to block Licensor from login access to their account at AudioSparx in perpetuity, or to block information editing capabilities for Licensor within their account, or to otherwise restrict or block Licensor's access to the AudioSparx and related web sites as may be appropriate based on the circumstances of Licensor's disruptive conduct.
Non-Disparagement - Licensor agrees to take no action which is intended, or would reasonably be expected, to disparage or harm AudioSparx or its reputation, or which would reasonably be expected to lead to unwanted or unfavorable publicity for AudioSparx, any of its employees, artists, associates or partners. For purposes of this section, “disparage” shall mean any negative statement, whether written or oral. The parties agree and acknowledge that this Non-Disparagement clause is a material term of this Agreement, the absence of which would have resulted in AudioSparx refusing to enter into this Agreement. In the event Licensor breaches any component of this Non-Disparagement provision at any time, Licensor acknowledges and agrees that it would be impractical or extremely difficult to ascertain the amount of actual damages to AudioSparx. For this reason, Licensor agrees that any violation of the Non-Disparagement provision of this Agreement shall result in the imposition of liquidated damages, and not as a penalty, in the amount of Seven-Thousand Dollars ($7,000.00 USD), per each occurrence, to be paid by Licensor to AudioSparx, which represents the reasonable compensation for the loss incurred because of the breach.
Indemnification - Licensor shall fully indemnify, defend and hold harmless AudioSparx and its parent company Navarr Enterprises, Inc. from all loss, damage and expense (including reasonable attorney’s fees) arising out of or connected with any claim by a third party which is inconsistent with any of Licensor’s warranties in this agreement, or by reason of any adjudication invalidating the Licensor’s copyrights in the Works which results in a final, adverse, non-appealable judgment or a settlement entered into with Licensor’s consent.
General – This Agreement is non-assignable and shall be binding upon the heirs, successors and legal representatives of each of the parties hereto. This License Agreement is made in Florida, and shall be governed by and construed in accordance with the laws of the United States of America and of the State of Florida, with specific jurisdiction assigned to the court at in St. Johns County, Florida. Any cause of action by Licensor with respect to this agreement must be instituted within one year after the claim or cause of action has arisen or further action is forever barred. This agreement represents the full and complete understanding between the parties. If any clause of this agreement is held to be invalid, the agreement continues in effect with all other clauses in effect.
By submitting an Artist Application to participate as a Licensor at AudioSparx, Licensor hereby acknowledges consent to the terms of this agreement.
See similar separate addendum agreements online for participating in StockMusicSite.com, CustomLabelMusic.com, and MusicCult.com. Each of these sites or services has their own separate license addendum. You will find these additional addendums as you add a new artist to the site, and for each artist, they can participate in any or all of our sites and opportunities at your sole discretion.
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