DIGITAL MUSIC DOWNLOAD SALES AGREEMENT

1.

Definitions .

(a)

“ Content File ” means each digital file containing a single-track sound recording or multi-track album of COMPANY Content, applicable Artwork (if any), parental advisory notices (if any), copyright notices (if any), videos (if any, provided by COMPANY and used by APPLE at COMPANY’S discretion), and associated metadata, e.g., core track data and editorial content data (if any).

(b)

“ Content Usage Rules ” means the usage rules applicable to sound recordings in the form of eMasters available on the Online Store that specify the terms under which an eMaster may be used, as set forth in Exhibit A attached hereto, and which may be modified by APPLE from time to time, subject to prior written approval by COMPANY (such approval or disapproval not to be unreasonably delayed) in the event of a material change to such usage rules.

(c)

“ Security Solution ” means the APPLE proprietary content protection system in effect as of the Effective Date used to protect eMasters sold on the Online Store pursuant to this Agreement, which content protection system shall be no less protective than, and the same as, the protection system used to protect any third party sound recording sold on the Online Store, and which may be modified by APPLE from time to time, subject to prior written approval by COMPANY (such approval not to be unreasonably withheld, delayed or conditioned) in the event of a material change to such content protection system such that eMasters are being protected less than before.

(d)

“ eMaster” or “eMasters ” means copies of COMPANY Content in digital form and having the Security Solution, which APPLE may sell on the Online Store pursuant to the terms and conditions of this Agreement.

(e)

“ Device ” means any digital player device or cellular phone having the Security Solution that can receive music files from another device or network connection, by any means, for playback of such music files.

(f)

“ Fulfillment Activities ” means sales activities relating to the sale and delivery of eMasters, provided by COMPANY, pursuant to the terms and conditions of this Agreement.

(g)

“ Term ” means the period beginning on the Effective Date of this Agreement and ending on the first day of the calendar quarter following the third anniversary of the Effective Date.

(h)

“ Territory ” means the United States, its territories and possessions, and Canada, its territories and possessions; and any other country or territory where COMPANY authorizes APPLE in writing hereunder, as the case may be.

(i)

“ Online Store ” means an electronic store and its storefronts branded, and owned and/or controlled by APPLE.

(j)

“ COMPANY Content ” means sound recordings owned or controlled by COMPANY that are provided by or on behalf of COMPANY, and in which COMPANY has cleared the necessary rights to authorize electronic sales and sound recording performances by APPLE pursuant to the terms of this Agreement, including but not limited to sound recordings in the form of (i) single-track sound recordings, and (ii) multi-track albums. Any sound recordings that are provided by or on behalf of COMPANY to APPLE are owned or controlled by COMPANY and have been cleared by COMPANY as described in the prior sentence.

(k)

“ Artwork ” means album cover artwork and any other artwork relating to COMPANY Content that COMPANY has cleared for use by APPLE in accordance with Section 2 below. Any artwork that is provided by or on behalf of COMPANY to APPLE will be deemed to have been cleared by COMPANY as described in the prior sentence.

2.

Authorization .

(a)

Subject to the terms of this Agreement, COMPANY hereby appoints APPLE as a reseller of eMasters. Accordingly, COMPANY hereby grants a non-exclusive right to APPLE, during the Term, to:

i.

reproduce and convert COMPANY Content delivered by COMPANY or by COMPANY’S representative designated by COMPANY in writing into eMasters;

ii.

perform and make thirty (30) second clips of the COMPANY Content available by streaming (“Clips”) to promote the sale of applicable eMasters on the Online Store, which Clips, if not provided by COMPANY, may be created by APPLE by using the first thirty (30) seconds of the applicable COMPANY Content;

iii.

promote, sell, distribute, and electronically fulfill and deliver eMasters and associated metadata to purchasers via the Online Store;

iv.

display and electronically fulfill and deliver Artwork for personal use solely in conjunction with the applicable purchased eMaster; and

v.

use COMPANY Content, Artwork and metadata as may be reasonably necessary or desirable for APPLE to exercise APPLE’s rights under the terms of this Agreement.

(b)

APPLE shall not be authorized to exploit COMPANY Content or Artwork in any manner or form not expressly authorized herein. Nothing in this Agreement shall be construed to prevent COMPANY from marketing or selling COMPANY Content or Artwork by any means. Nothing herein shall obligate APPLE to actually exercise its rights under this Agreement.

(c)

Except for a special circumstance, such as an exclusive, limited-time, one-off promotion for a particular COMPANY sound recording, or for a reason beyond COMPANY’S control, COMPANY shall otherwise make all eMasters available to APPLE hereunder for sale on the Online Store in both a so-called “single” format and in a multi-track “album” format. APPLE may sell eMasters on the Online Store in the format that APPLE believes most favorably furthers the commercial purpose of this Agreement and otherwise in accordance with APPLE’s then-current Online Store business practices.

(d)

Except as set forth in Section 2(a)(ii) or elsewhere herein, APPLE will not edit, change or alter any of the COMPANY Content or Artwork without COMPANY’S prior written consent (such consent not to be unreasonably withheld, delayed or conditioned), provided that APPLE may modify metadata as reasonably necessary to correct errors or to append sub-genres or like information for artist and track categories.

(e)

APPLE shall not pledge, mortgage or otherwise encumber any part of the COMPANY Content, eMasters, or Artwork.

3.

COMPANY Obligations .

(a)

COMPANY shall use commercially reasonable efforts to promptly obtain clearances in the Territory for all sound recordings under its control, and related artwork, in order to enable sales of eMasters by APPLE hereunder.

(b)

Content Files must be [*].

(c)

COMPANY shall use commercially reasonable efforts to electronically deliver, at COMPANY’S expense, properly encoded Content Files to APPLE using a secure FTP site address provided by APPLE to COMPANY from time to time, or other delivery means as may be reasonably requested by APPLE.

(d)

COMPANY, or a third party designated by COMPANY in writing and approved by APPLE, shall commence delivery of Content Files as soon as reasonably possible after the Effective Date, and for just cleared COMPANY Content or new releases, no later than when COMPANY first makes such COMPANY Content publicly available by any means (e.g., radio play, “street date,” etc).

*

Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

4.

Royalties .

5.

Wholesale Price .

6.

APPLE Obligations .

(a)

APPLE shall condition sale and delivery of eMasters upon an end user’s acknowledgement of terms of use for such eMasters (“Terms of Use”), which Terms of Use shall be no less restrictive than the Content Usage Rules, and shall state that the sale of eMasters does not transfer to purchaser any commercial or promotional use rights in the eMasters.

(b)

Subject to Section 4, APPLE shall be responsible for all costs associated with APPLE’s Fulfillment Activities.

(c)

If there is a change of circumstance during the Term as a result of which COMPANY reasonably believes that it does not have, or no longer has, the rights necessary to authorize APPLE to use any COMPANY Content or Artwork as provided for herein, or COMPANY reasonably believes that APPLE’s continued sale of any COMPANY Content or Artwork will substantially harm COMPANY’s relations, or violates the terms of any of COMPANY’S agreements, with any applicable copyright owner, artist, producer or distributor, then COMPANY shall have the right to withdraw, upon written notice to APPLE’s designated representative, authorization for the sale of such COMPANY Content or Artwork. Following such withdrawal, APPLE shall cease to offer such COMPANY Content or Artwork for sale within three (3) business days after APPLE’s receipt of such notice of withdrawal, and COMPANY shall use commercially reasonable efforts to clear such withdrawn COMPANY Content or Artwork and shall promptly notify APPLE if and when such COMPANY Content has been cleared and is again authorized for sale by APPLE through the Online Store. COMPANY shall not withdraw COMPANY Content if such COMPANY Content is still being made available by COMPANY to any other provider of digital downloads.

7.

Parental Advisory .

8.

Payment and Reports .

(a)

APPLE shall remit payment to COMPANY for the sale of eMasters in accordance with the following: (i) the “sale” of each eMaster shall occur when such eMaster is successfully delivered by APPLE to an end user; (ii) payments shall accrue at the time that such eMaster is sold; and (iii) for each eMaster sold, APPLE shall pay to COMPANY an amount equal to the wholesale price for the applicable eMaster (collectively “eMaster Proceeds”).

(b)

APPLE will compute eMaster Proceeds payable to COMPANY after the end of [*], and will send COMPANY a [*] eMaster Proceeds statement in accordance with Apple’s standard business practices. The eMaster Proceeds statement shall be accompanied with payment in the amount of eMaster Proceeds due within [*] after the end of each such calendar month. Such payment shall constitute full consideration for all rights granted and obligations undertaken by COMPANY hereunder.

9.

Names and Likenesses; Promotional Use and Opportunities .

(a)

APPLE may use the names and likenesses of, and biographical material concerning, any eMaster artists, bands, producers and/or Songwriters, as well as track and/or album name, and Artwork, in any APPLE marketing materials for the sale, promotion and advertising of the applicable eMaster which is offered for sale on the Online Store 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 eMasters). Further written approval of COMPANY shall be required if any artist’s name is otherwise used as an endorsement of APPLE, the Online Store, or APPLE’S products.

(b)

APPLE shall have the unrestricted right to market, promote and advertise the Online Store and sound recordings available for purchase on the Online Store as it determines in its discretion. Without limiting the foregoing, APPLE shall have the right to determi