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SUNHAWK CORPORATION
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DISTRIBUTION AGREEMENT
as of June 12, 1998
EMI Christian Music Publishing
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tel: (▇▇▇) ▇▇▇-▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
Gentlemen and ladies:
When signed by you ("EMI") and us ("Sunhawk"), the following will constitute our
agreement:
1. EMI hereby grants to Sunhawk the non-exclusive right to sell and
distribute digital editions of EMI's copyrighted musical composition(s) and
third party compositions for which EMI has obtained the rights (the
"Editions(s)"), solely via Sunhawk's Solero(TM) technology/format over the
Internet from Sunhawk's website, currently located a ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇.▇▇▇.
subject but not limited to the following:
o CONTENT: EMI will supply Sunhawk with compositions chosen by EMI for
distribution via the Sunhawk website. The downloadable file of each
such composition shall include a playback feature which incorporates a
midi file arrangement based solely on the musical content of the
Editions(s).
o FORMAT: Each edition(s) shall be formatted in such a way as to include
any and all appropriate copyright information supplied by EMI, and
Sunhawk shall insure that such copyright information is made part of
each download/sale.
o WEBSITE DISPLAY: Sunhawk shall display the edition(s) on Sunhawk's web
site which may display and use EMI's trademarks, service marks and any
and all appropriate artwork, all as selected by EMI. Links to the
edition(s) will be provided to EMI for use and display on EMI's web
site and/or any other web site of EMI's choosing. A link to EMI's web
site will be provided from the Sunhawk web site.
o FILE USAGE: Both EMI and Sunhawk may keep archival copies of the
Solero files. The usage of Solero files is restricted to the terms of
this contract. Sunhawk is sole distributor of the Solero file. EMI is
permitted to make paper copies for use in their own paper publishing.
EMI cannot distribute Solero files or file derived from a Solero file
without Sunhawk's written consent and similarly, Sunhawk cannot
extract midi components or sell the music without EMI's written
consent. Sunhawk will provide to EMI under separate non-disclosure and
license agreements a copy of the Solero Music Editor along with
instructions on how to save Solero files to a postscript format for
the purposes of traditional paper publishing without financial
obligation to Sunhawk (not including support) while Sunhawk is the
distributor of EMI's digital music, and EMI may sell such music in any
format except digital without obligation to Sunhawk.
2. The territory applicable to this Agreement shall be the World (the
"Territory").
3. Sunhawk shall pay EMI a fee for music sold according to the following
formula:
Sums equal to sixty-five percent (65%) based on the amount of Sunhawk's
Gross Receipts (hereinafter defined) but not less than the following
amount(s) per Edition(s) sold: $2.62 per "full
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PIANO/VOCAL/CHORDS" Edition, $2.03 per "EASY PIANO" Edition and $.85 per
"FAKEBOOK/LEADSHEET" Edition. Such minimums to increase or decrease
according to the formula:
R = your percent = 65%
CCP = credit card transaction fee = $.45
CCR = credit card transaction rate = 4.5%
MLC = Music Lover's Club Discount = 5%
SRP = suggested retail price
Minimum payment = R x (SRP - CCF - (SRP x CCR) - (SRP x MLC))
As used herein, the term "Gross Receipts" means the gross amount of monies
actually received by Sunhawk, or credited to Sunhawk's account, in respect
of sales of the Edition(s), less any taxes, discounts, reasonable credit
card transaction fees and/or credits. The foregoing sums include all
payments to be made to writer(s) and/or publisher(s) and/or arranger(s)
(other than arranger(s) engaged by Sunhawk) of the Edition(s) for which
payments EMI shall be responsible). EMI shall hold Sunhawk free and
harmless from and against any claim of the writer(s) and/or publisher(s)
and/or arranger(s) of the Edition(s) other than arrangers engaged by
Sunhawk.
4. If the conversion or transcription of a composition should for any
reason be considered an arrangement of that composition, Sunhawk will have the
arrangement made by a person connected with Sunhawk as Sunhawk's
employee-for-hire and Sunhawk shall, in each instance, assign to EMI (or the
third party that owns the compositions) all rights in the copyright in the
arrangement, together with the sole right of registering the copyright as a
work made for hire in EMI's name or the name of EMI's designee.
5. The cost of preparing and offering for sale the aforesaid Edition(s)
will be covered in full by Sunhawk. Suggested retail list prices shall be set
by EMI.
6. The rights hereunder granted shall continue for a term of five (5)
years commencing on the date hereof. Thereafter, the rights granted shall
continue on a yearly basis until such time as EMI, by written notice, notify
Sunhawk that such rights hereunder are terminated.
7. Sunhawk shall render monthly accountings to EMI within thirty (30) days
following the end of each calendar month, accompanied by appropriate
remittances for all sums shown to be due thereunder. EMI (and/or EMI's
designated agent) shall have the right, at EMI's sole cost and expense, upon
thirty (30) days prior written notice, and not more than once during each
calendar year, to audit at Sunhawk's office during normal business hours
Sunhawk's books and records with respect to the Edition(s). Each accounting
statement shall be conclusive and binding on EMI in all respects and EMI shall
be barred from maintaining or instituting any action or objection to such
accounting statement unless EMI shall give Sunhawk a detailed written
objection, stating the basis thereof, within the earlier of (i) thirty six (36)
months following the end of the accounting period which is subject to dispute,
or (ii) twelve (12) months following EMI's audit of such accounting period.
8. EMI warrants and represents that EMI has the full and unrestricted
right to enter this agreement and to grant all of the rights herein granted to
Sunhawk; and that the exercise of such distribution rights by Sunhawk in
accordance with this agreement will not infringe upon the copyright or violate
the property, contractual or other rights of any third party. EMI further
grants and assigns to Sunhawk the benefit of all warranties and representations
made for EMI's benefit by any third party with respect to the Edition(s). EMI
shall hold Sunhawk free and harmless and shall indemnify Sunhawk against any
actual loss or damages (including court costs and reasonable attorneys' fees)
due to a breach of this agreement which results in a final adverse judgment
against Sunhawk or which is settled with EMI's prior written consent (which
shall not be unreasonably withheld).
9. Sunhawk warrants and represents that Sunhawk has the full and
unrestricted right to enter this agreement and to grant all of the rights
herein granted to EMI.
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10. If a claim, whether oral or written, is presented against Sunhawk
which is inconsistent with any of EMI's warranties, representations or
covenants contained herein, Sunhawk shall thereupon serve notice upon EMI
containing the full details of such claims then known to Sunhawk, and EMI shall
assume the defense thereof (except to the extent that such claim involves
Sunhawk's alleged act of omission).
11. Nothing contained herein is intended to constitute a partnership or
joint venture between the parties hereto, it being understood that the
relationship between EMI and Sunhawk shall be that of independent contractors
and Sunhawk shall have no authority to bind EMI in any way to Sunhawk or any
third party.
12. In addition to the copyright notices supplied by E-mail and/or fax
from EMI on a song-by-song basis, Sunhawk shall include EMI's Worship Together
trademark, other trademarks determined by EMI and the following special notice
on the cover page on each Editions(s):
NOTICE: This song may be prepared for congregation use under the terms of your
CCLI license. However, if you are not a CCLI license holder, any duplication,
adaptation, arranging and/or transmission of this copyrighted music file
requires the written consent of the Copyright owner(s) and
EMI CHRISTIAN MUSIC PUBLISHING. Unauthorized uses are
an infringement of the Copyright Laws of the
United States and other countries.
13. This agreement shall be binding and shall inure to the benefit of the
parties hereto.
14. This is the entire agreement between Sunhawk and EMI and may only be
modified or terminated by an agreement in writing signed by Sunhawk and EMI.
This agreement shall be deemed to have been entered into, and shall be
interpreted in accordance with the laws of the State of Tennessee, and any
legal action concerning this agreement shall be heard in the State or Federal
Courts located in Nashville, Tennessee.
15. This agreement replaces and supersedes our prior Distribution
Agreement dated January 1, 1998, any and all prior agreements, written and/or
oral, with the exception of the Nondisclosure Agreement and License Agreement
(Service Provider) dated January 1, 1998.
SUNHAWK CORPORATION
/s/ ▇▇▇▇▇ ▇▇▇▇▇
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By: ▇▇▇▇▇ ▇▇▇▇▇
Its: CEO
AGREED TO AND ACCEPTED:
EMI Christian Music Group
/s/ [SIG]
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By:
Its: Sr. Vice President