RIGHTS AND SERVICES AGREEMENT
TABLE 18, LLC
THIS AGREEMENT (“Agreement”) is made and entered into at Worcester, Massachusetts, as of ______________, 2006, by and between Jediah Jarvais (“Jediah”), and Jediah Band, LLC (“Company”), a Massachusetts limited liability company formed to develop, produce, promote and exploit music and entertainment content of Jediah and the Jediah Band, a group of musical artists, consisting of Jediah, _______________, ____________________________, and ________________________ (“Jediah Band”), throughout the universe, with respect to Jediah’s services and rights in connection with the mutual development, production, performance, sale and exploitation of music (the “Music”) and entertainment content, associated ancillary merchandise (“Merchandise”); and further associated areas of exploitation and ancillary rights including, but not limited to, live-action and animated motion pictures, live-action and animated television productions, video, publishing revenues, CDs, DVDs, CD-ROMs (and other digital media), electronic games, trademark licensing, facilities licensing and endorsements (“Ancillary Activities”).
Reference is hereby made to a certain “Contribution Agreement” by and between the Parties (defined below) and dated as of ______________________ (“Contribution Agreement”), whereby the Parties all contributed certain property to the Company, including but not limited to certain intellectual property (“Contributed Property”), all as more particularly described in the Contribution Agreement, a true and accurate copy of which is attached hereto as Exhibit “A”. All of the Contributed Property, plus all grant of rights (“Rights”) and services hereunder and the results and proceeds thereof, including, but not limited to Music, Merchandise, and Ancillary Activities, now existing or hereafter acquired, shall be collectively referred to hereunder as “Company Property”.
The services of Jediah are being furnished to Company by Jediah, and the rights granted herein are granted from Jediah to Company. Consequently, all services and obligations to be performed hereunder by Jediah shall be deemed to be performed by Jediah at the direction of Company, and all compensation and other payments for the performance of such services and obligations shall be paid by Company to Jediah. The Company, Jediah, and Jediah Band are from time to time collectively referred to herein as the “Parties”. Jediah and Jediah Band are from time to time collectively referred to herein as the “Jediah Parties”.
In consideration of the mutual covenants and conditions herein contained, the Parties hereto agree as follows:
1. Exclusive Services. Company hereby engages and retains Jediah, individually and in his capacity as a member of Jediah Band to render Jediah’s and Jediah Band’s exclusive full time services as musical artists to Company and/or its divisions, subsidiaries or affiliates in accordance with the reasonable directions and instructions of Company’s manager (“Manager”) or officers,as the case may be. Any exceptions to the requirement of exclusivity shall be within the sole and absolute discretion of the Company, and shall be set forth in a writing signed by the Company.
2. Trademarks. Likeness. The trademarks “Jediah” and “Jediah Band” shall be registered with the United States Patent and Trademark Office in connection with the use thereof in all areas of the entertainment industry, including, without limitation, in connection with the recording and sale of phonograph records, the establishment of fan clubs, the rendition of concerts and live performances, and the sale of clothing and other merchandise, in the name of Company at Company’s expense and Jediah and Jediah Band shall license such trademarks for all lawful purposes as provided herein to Company exclusively and in perpetuity, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged. Company, Jediah, and Jediah Band agree to execute such documents as are reasonably necessary to effect such registration, grant of license and exploitation. The Jediah Parties hereby appoint Company as their attorney-in-fact, coupled with an interest, for the purpose of applying for and obtaining such registration. During the Term (defined below) of this Agreement and for as long as Company shall be entitled to sell Records (defined below) derived from Masters (defined below) produced under this Agreement or in connection with the exploitation of any of the Contributed Property during the Term, the Jediah Parties hereby license to Company the right, and to license others the right, to use their name, likeness, voice, biographical material or other identification for use in association with any promotion, marketing or advertising, in any medium now known and existing or that is created in the future, of the sale of Records (defined below) pursuant to this Agreement. Further, the Jediah Parties will not license or consent to the use of either Jediah's or Jediah Band’s name, likeness, voice, biographical material or other identification, for or in connection with the recording or exploitation of Records under this Agreement by or for anyone other than Company.
3. Service Term. Term. The term of the Jediah Parties’ engagement shall be for a period of three (3) years, commencing upon the delivery to Company of a fully-executed copy of this Agreement (in form and substance acceptable to Company) (“Service Term”). The Jediah Parties hereby irrevocably grant to Company the option to extend the Service Term upon the same terms and conditions for an additional three (3) years from the date hereof, which shall be exercised by the Company automatically, unless Company gives written notice to the Jediah Parties within thirty (30) days prior to the date the Agreement would otherwise expire, that Company does not wish to extend the Agreement. The Company shall have the right to exploit the Company Property in all media in perpetuity (“Term”) throughout the universe.
4. Short Form Assignment of Rights. The Jediah Parties shall fully execute and deliver to Company, in form and substance satisfactory to Company, (a.) the Short Form Assignment of Rights, attached hereto as Exhibit “B,” and incorporated herein by this reference, and (b.) the standard Company Confidentiality Agreement, attached hereto as Exhibit “C” and incorporated herein by this reference.
5. Records. The Jediah Parties shall render exclusive services (“Services”) to Company as reasonably required by Company including, without limitation (a.) assisting in the creation, development and production of Company Property, which shall include, but shall not be limited to the production of no less than two (2) long playing phonograph records (not including “live” recorded albums, or the album with the working title “Flight,” or other compilation type albums) consisting of original song compositions by Jediah (“Compositions”) not previously recorded by any of the Jediah Parties (“Records”) and the recording of such Compositions in the form of master recordings (“Masters”), subject to the Recording Requirements (defined below) as specified herein; (b.) musical performances with Jediah and/or the Jediah Band, including, but not limited to a local, regional, national, or worldwide appearances or tours for commercial or promotional purposes; (c.)to assist the Company in the production of videos for commercial and/or promotional purposes, including, but not limited to any commercial sale or other exploitation by Company of so-called long form videos; (d.) working with the Company spokesperson for the proposed publicity, marketing, and advertising campaign associated with exploitation of the Company Property; and (d.) as otherwise reasonably required and/or instructed by Company. The Parties hereto understand and agree that the Jediah Parties’ vision with respect to the style, form, development and execution of the Company Property shall be incorporated into all aspects of the Company Property and any derivative uses provided herein. Notwithstanding the foregoing, having consulted with the Company, or the Company’s Manager or officers, the Company’s determination in its sole discretion in all areas related to the Company Property shall be binding. Jediah, both individually and as a member of the Jediah Band, hereby accepts such engagement, and agree to perform Services on behalf of the Company hereunder diligently and to the best of Jediah’s ability. The results and proceeds of the Services of the Jediah Parties hereunder shall be deemed a “work-for-hire” specially ordered or commissioned by the Company, as set forth further hereinbelow. The production of the Records and Masters shall be subject to “Recording Requirements” as set forth as follows:
(i) During the Service Term, the Masters shall be recorded in a Company approved recording studio, at times to be mutually agreed uponbetween the Jediah Parties and the Company. Company shall have the right and opportunity to have a representative attend each recording session. Company and Jediah shall jointly select the Compositions to be recorded and each Master shall be subject to Company's approval as technically and commercially satisfactory for the manufacture and sale of Records. All Masters shall be produced by producers mutually approved by Jediah and the Company. Each Record shall comprise no less than ten (10) nor more than twelve (12) Masters. Upon Company's request, Artist shall re-record any Composition recorded hereunder until a recording which in Company's sole judgment is satisfactory for the manufacture and sale of Records shall have been obtained. Should Jediah fail to appear at any recording session of which Jediah has been given reasonable notice, for any reason, unless Jediah gives forty-eight (48) hours notice to Company of an inability to appear as scheduled, Company shall have the right to charge any of its out-of pocket expenses in respect of such session against Jediah's contingent compensation hereunder, if and when earned.
(ii) No recording sessions shall be commenced hereunder nor shall any commitments be made or costs incurred in connection therewith unless and until a proposed budget for the Masters is approved by the Company. Company shall have final decision on all money to be spent on all recording costs ("Recording Costs"). Company shall pay the Recording Costs of the Masters recorded at recording sessions conducted pursuant to this Agreement in any amount not in excess of the recording budget.
iii) All Recording Costs paid or payable by Company under this Agreement shall be an expense under this Agreement. Recording Costs incurred by Company in respect of Masters in excess of the recording budget theretofore approved by Company, shall be an expense under this Agreement. The Jediah Parties shall not incur any Recording Costs, not previously approved by Company in the recording budget, without Company's written approval, and the failure to act accordingly shall be deemed a material breach of this Agreement.
iv) The Jediah Parties represent they will cooperate with publicity and promotional efforts of the Company to support sales of the Record(s) by appearing from time to time as requested by Company. If travel is required outside of Worcester County, Massachusetts, then Company shall pay for the costs of transportation and such costs shall be considered expenses under this Agreement.
(v) Company agrees to consult with Jediah in connection with the preparation of artworkfor each Record. Company shall be the owner of the copyright in all artwork incorporated into the packaging ofthe Records released pursuant to this Agreement as a work made for hire. All costs of preparation of such artwork or paid by Company for preparation and rights to artwork shall be an expense as set forth in this Agreement.
(vi) All Compositions or material recorded pursuant to this Agreement, which are written or composed, in whole or in part, or owned or controlled directly or indirectly by Jediah or Jediah bandor any producer of Masters subject thereto (herein "Controlled Compositions"), shall be and are hereby perpetually licensed to Company. Jediah agrees not to record any Controlled Composition or other song recorded pursuant to this Agreement without Company's prior written consent, for the later of i) five (5) years subsequent to the date of release by Company of any Controlled Composition or song recorded hereunder; or ii) two (2) years subsequent to the expiration or other termination of the Term of this Agreement.
(vii) All songs recorded during the Service Term shall be recorded by Jediah on Company's behalf and all Records made therefrom, together with the performances embodied therein, shall, from the inception of their creation, be entirely the property of Company in perpetuity, throughout the universe (for the Term), free of any claim whatsoever by Jediah or by any persons deriving any rights or interests from Jediah. For the purposes hereof, all such Masters shall be works made for hire under the United States Copyright Law. In the event such works are deemed not to be works made for hire, then pursuant to this Agreement, the Jediah Parties hereby transfer all of their right, title and interest to the copyrights in the Masters to Company. The Jediah Parties agree to execute any documents to fullfill the transfer of copyright to the Masters upon request by Company. Company shall have the right to secure registration of the sound recording copyright in and to the Masters in Company's name as the owner and author thereof and to secure any and all renewals of such copyright. Nevertheless, the Jediah Parties shall, upon our request, execute and deliver to us any assignments of copyright (including renewals and extensions thereof) in and to such Master recordings as the Company may deem necessary. Company (and its Licensees) shall have the sole and exclusive right to use the Masters throughout the universe or any part thereof in any manner it sees fit, including, without limitation, the sole and exclusive right throughout the universe for the Term.
6. Non-Compete. Neither Jediah or Jediah Band shall during the Term of this Agreement perform music services for any person, firm or corporation or engage in any activity which would interfere with the performance of the Services of the Jediah Parties hereunder, or become financially interested in any other activity in the music industry and/or the production, distribution or exhibition of music or music performance anywhere in the world, unless otherwise consented to in writing by the Company.
7. Compensation. Equity Interest in Company and Profits. In consideration of and as
compensation for the Rights granted and/or licensed and the Services agreed to be
performed hereunder, Jediah shall be entitled to receive the following:
a. With respect to the Company Property, as further set forth hereinabove, and all
Services hereunder, Jediah shall be entitled to an ownership interest and profit
distribution in the Company in the amount and subject to the terms and conditions set
forth in the operating agreement of the Company, as may be amended from time to time
b. With respect to Jediah’s Services in connection with the creation and development of
Company Property, without limitation, Jediah’s creative, development, and marketing
and promotional services in all areas of production of Company Property, Jediah shall
be entitled to an equitable salary amount payable on a monthly basis through the
Service Term. Such salary amount shall be subject to the salary cap restrictions of all
employees of the Company, which shall not exceed a combined salary of all Company
employees in the amount of $60,000 per month (“Salary Cap”). The salaries of
Company employees shall be determined in the discretion of the Manager, or the
officers of the Company, based on the revenues and expenses of the Company, and
shall be reviewed no less than every six months by the Manager. The Salary Cap shall
be reviewed on an annual basis by the Manager, and may be amended in the discretion
of the Manager, or the Officers of the Company.
c. Statements as to profit participations of the Company shall be sent by Company to
Jediah on a quarterly basis. Jediah shall be deemed to have consented to all such
statements and all other accountings rendered by Company and each such statement or
other accounting shall be conclusive, final, and binding, shall constitute an account
state, and shall not be subject to any objection for any reason whatsoever unless
specific objection in writing, stating the basis thereof, is given by Jediah to Company
within two (2) years after the date rendered. Company shall maintain books of
account concerning the sale of Records hereunder. Jediah, or a certified public
accountant, in Jediah's behalf, may, at Jediah's sole expense, examine the Company
books relating to the sale of Records hereunder solely for the purpose of verifying the
accuracy thereof, only during our normal business hours and upon reasonable written
notice. Company's books relating to any particular statement may be examined as
aforesaid only within two (2) years after the date rendered and Company shall have no
obligation to permit Jediah to so examine our such books relating to any particular
statement more than twice.
8. Business Expenses. During the Service Term, unless earlier terminated below, Company shall reimburse Jediah for approved and reasonable business expenses on an accountable basis, and on a regular basis in accordance with its policy regarding the reimbursement of such expenses.
9. Benefit Plans. During the Service Term, unless earlier terminated below, subject to the terms of such plans, Jediah shall be entitled to participate in all current or future group plans (such as life, medical, dental, disability and other insurance plans) maintained by Company, if any. The establishment of any such plans shall be in the discretion of the Manager, and the Company shall be under no obligation to establish such plans.
10. Deductions. Jediah agrees that the Company may deduct and withhold from Jediah’s compensation hereunder the amounts required to be deducted and withheld under the provisions of the federal and state tax laws, any and all amendments thereto, and other statutes heretofore or hereafter enacted requiring the withholding of compensation.
11. Key-Man Life Insurance. At its sole election and at its sole cost and expense, Company shall be entitled during the Service Term to obtain life insurance on Jediah’s life with Company as the sole beneficiary thereof. Jediah shall fully cooperate in connection with the obtaining of same and shall submit at a time and place satisfactory to Company to a physical examination and complete any and all documents necessary or desirable in respect thereof. Jediah hereby acknowledges that neither Jediah or Jediah’s estate shall have any right to claim the benefits of any such policy obtained by Company.
12. Disability. In the event that Jediah is unable to perform the Services required of Company hereunder as a result of a physical or mental disability and such disability shall continue for a period of sixty (60) or more consecutive days or an aggregate of three (3) or more months during any consecutive twelve (12) month period during the Service Term, subject to applicable federal and state law, Company shall have the right, at its option, to terminate Jediah’s engagement hereunder, and Company shall only be obligated to pay Jediah the specified salary and fees and any additional compensation (including, without limitation, any contingent compensation and expense reimbursement for expenses incurred prior to Jediah’s termination) earned by Jediah prior to the termination of Jediah’s employment. In the event of termination, Jediah’s equity interest and profit participation in the Company shall be subject to the terms and conditions of the Operating Agreement.
13. Disability Paid by Insurance. Whenever compensation is payable to Jediah hereunder during or with respect to a time when Jediah is partially or totally disabled and such disability (except for the provisions hereof) would entitle Jediah to disability income or to salary continuation payments from Company according to the terms of any plan now or hereafter provided by Company or according to any policy of Company in effect at the time of such disability, the compensation payable to Jediah hereunder shall be inclusive of any such disability income or salary continuation and shall not be in addition thereto. If disability income is payable directly to Jediah by an insurance company under an insurance policy paid for by Company, the compensation payable to Jediah hereunder shall be inclusive of the amounts paid to Jediah by said insurance company and shall not be in addition thereto.
14. Suspension. Company may, at Company’s election, suspend operation of this Agreement both as to the rendition of Jediah’s Services and as to Jediah’s compensation for and during the continuance of any period(s) during which:
a. Jediah shall fail, neglect or refuse (whether by reason of mental or physical incapacity (subject to Paragraphs 12- 13., above, or otherwise) to perform or observe any or all of Jediah’s obligations hereunder at the times and in the manner provided. In the event of any such suspension, Company may, at Company’s election, add a period of time equal to all or any part of the period(s) of any such suspensions (i.) to the applicable contract year(s); (ii.) to the dates for the commencement of a subsequent contract year(s); and (iii.) to the dates of commencement/expiration of the applicable fiscal year; and/or
b. Company shall be materially hampered, interrupted or interfered with in the normal conduct of Company’s business by reason of any epidemic, fire, action of the elements, strike, walkout, labor dispute, governmental order, court order or order of any other legally constituted authority, act of God or public enemy, riot, civil commotion, inability to procure materials and equipment or any other cause or causes beyond Company’s control, whether of the same or any other nature. In the event of any such suspension, Company may, at Company’s election, add a period of time equal to all or any part of the period(s) of any such suspensions both to the applicable contract year(s) and to the dates for the commencement of a subsequent contract year(s). If any such suspension shall continue for more than eight (8) consecutive weeks, then Company may terminate Jediah’s engagement for the then-remaining portion of the Service Term. In such event, Company shall thereupon be released and discharged of and from all further obligations hereunder, except for any monies due and owing to Jediah and then unpaid and any contingent compensation, if any.
c. If Company suspends Jediah's Services and compensation as set forth above, for a period of eight (8) consecutive weeks or longer, Jediah shall have the right to terminate Jediah’s engagement hereunder on five (5) days written notice unless Company resumes payment of Jediah’s compensation hereunder within five (5) days of receipt of such notice.
15. Termination for Cause. Company shall have the right to terminate Jediah’s engagement hereunder at any time for cause. As used herein, the term “cause” shall mean: (i) misappropriation of any material funds or property of Company or any of its related companies; (ii) failure to obey reasonable and material orders given by the Manager or officers of Company; (iii) any material breach of this Agreement by Jediah; (iv) conviction of or entry of a plea of guilty nolo contendre to a felony; (v) any willful act, or failure to act, by Jediah in bad faith to the material detriment of Company; or (vi) material non-compliance with established Company policies and guidelines (after which Jediah has been informed in writing or orally of such policies and guidelines and have failed to cure such non-compliance); provided that in each such case (other than (i) or (iv) or a willful failure in (ii) or repeated breaches, failures or acts of the same type or nature) prompt written notice of such cause is given to Jediah by specifying in reasonable detail the facts giving rise thereto and that continuation thereof will result in termination of employment, and such cause is not cured within three (3) business days after receipt by Jediah of the first such notice. If Jediah is terminated as set forth in this Paragraph 16., then payment of the specified salary and any additional noncontingent cash compensation (including, without limitation, any contingent compensation which has vested, and expense reimbursement for expenses incurred prior to Jediah’s termination) theretofore earned by Jediah shall be payment in full of all compensation payable hereunder provided, however, that if Jediah is terminated under this Paragraph 16., then Company may, in addition to filing appropriate actions against Jediah, withhold and deduct from compensation or other payments due to Jediah hereunder any damage, loss, or expense (including attorneys’ fees) caused Company by Jediah's default and Jediah shall remain liable to Employer for the full amount of said damage, loss or expense (including attorneys’ fees) to the extent such withheld or deducted compensation or other payment is insufficient to satisfy said amount. If Company terminates Jediah, then Jediah shall immediately reimburse Company for all paid but unearned sums.
Jediah warrants that Employee shall not use controlled substances (e.g., illegal narcotics, steroids, etc.,) during the Service Term, unless so prescribed by a medical doctor. Any breach of such warranty by Jediah shall be considered a material breach of the Agreement. In the event of termination, Jediah’s equity interest and profit participation in the Company shall be subject to the terms and conditions of the Operating Agreement.
16. Biography. Publicity.Company shall have the right to use Jediah’s name, biography likeness and recordings of Jediah’s voice in connection with its business including, without limitation the advertising and/or marketing and/or promotion and/or advertising of Company and/or the Company Property as follows:
a. Biography: Jediah shall promptly submit to Company a biography of Jediah. Provided thatJediah timely submits such biography, Company shall not use any other biographical information other than contained in such biography so furnished, other than references to Company’s prior professional services and Jediah’s services hereunder, without Jediah’s prior approval (which approval shall not be unreasonably withheld). If Jediah fails to promptly submit a biography, then Jediah shall not have the right to approve any biographical material used by the Company.
b. Likeness: During the Term, Jediah shall pose for publicity pictures as reasonably directed by Company for no further compensation. Company shall submit photographs to Jediah for approval, which approval shall be binding on Company provided that Jediah shall be obligated to approve not less than fifty percent (50%) of such submitted photographs.
17. Audio-Visual. Company shall be entitled to use and exploit any and all audio-visual material relating to Jediah that is currently under Jediah’s control. Jediah further agrees that Jediah shall use Jediah’s best efforts in assisting Company to obtain material not under Jediah’s control, subject to the terms of any prior existing agreement between Jediah and a third party with respect to such material, provided that Company shall not be required to pay additional fees and/or royalties to Jediah for such third-party materials. During the Term, Jediah shall not be entitled on his own account or to authorize others to sell lease, license, loan and/or otherwise distribute any previously recorded and/or produced and/or distributed materials relating to musical work that Jediah and/or Jediah Band has created and/or in which Jediah has materially participated to a third party without the express written approval of Company.
18. Work Product. All memoranda, notes, records, computer files, and other documents or tangible material made or compiled by Jediah, or made available to Jediah during the Term concerning the business of Company, shall be the sole property of Company and shall be delivered to Company on the expiration the Service Term or termination of this Agreement, or at any other time on request. Jediah and Jediah Band shall keep in confidence and shall not use for Jediah or Jediah Band or others, or divulge to others, any secret or confidential information, knowledge or data of Company or any of its related companies obtained by Jediah or Jediah Band as a result of Jediah’s engagement hereunder, unless authorized in writing by Employer or required by law or generally publicly available; if required by law, Company shall be given reasonable notice and opportunity to appear. Without limiting the generality of the foregoing, Jediah and Jediah Band acknowledge and agree that by signing and delivering the standard Company Confidentiality Agreement, attached hereto and incorporated herein by this reference, to Company upon the commencement of Jediah’s Services hereunder, all terms and conditions contained therein and all of Jediah’s obligations and commitments provided for therein, shall be deemed, and hereby are, incorporated into this Agreement as if set forth in full herein. The provisions of this Paragraph shall survive the expiration or earlier termination of this Agreement. Any breach of this provision shall be a material breach of this Agreement, justifying its immediate termination by Company, in addition to any other rights or remedies Company may have at law or in equity.
19. Injunctive Relief. Jediah and Jediah Band acknowledges that the Services to be rendered by Jediah and Jediah Band under the terms of this Agreement, and the Rights and privileges granted to Company by Jediah and Jediah Band under its terms, are of a special, unique, extraordinary and intellectual character, which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action at law, and that a breach by Jediah or Jediah Band of any of the provisions contained in this Agreement may cause Company great and irreparable injury and damage. Jediah and Jediah Band acknowledge that Company shall be entitled, in addition to any other remedies it may have at law, to seek the remedies of injunction, and other equitable relief for a breach of thisAgreement by Jediah or Jediah Band. This provision shall not, however, be construed as a waiver of any of the rights whichCompany may have for damages or otherwise.
20. Assignment. Company may assign this Agreement or all or any part of its rights hereunder to any entity which succeeds to a substantial portion of Company’s assets or to a related or sister company and this Agreement shall inure to the benefit of such assignee, subject to Jediah’s right to approve any such assignment. In the event Company assigns this Agreement, Employer shall remain secondarily liable for Company’s obligations hereunder, salary and other payments to Jediah, to the extent the same have accrued and become payable pursuant to all terms of this Agreement, in the event Company’s assignee fails to make such payments or to comply with such obligations hereunder.
21. Representations and Warranties. The Jediah Parties warrant and represent that to the best of their knowledge, or that which the Jediah Parties should have known exercising reasonable prudence and diligence: (a) the Services hereunder shall not infringe on the rights of any third parties or constitute an interference with contractual rights or business advantage of others; (b) neither of the Jediah Parties has any prior existing commitment which will conflict or interfere with their rendering exclusive Services hereunder; (c) neither of the Jediah Parties knows of any party who will or might reasonably claim that in offering engagement to Company, the Jediah Parties has interfered with their contractual commitments or prospective business advantage; and (d) neither of the Jediah Parties will enter into any future commitment which will conflict or interfere with the Jediah Parties rendering exclusive services hereunder. The Jediah Parties further represent and warrant that neither of the Jediah Parties will make any commitment which is or may be binding on the Jediah Parties without Company’s prior written consent. The Jediah Parties agree to indemnify Company and its respective Manager, employees, members, officers, agents, successors and assigns against and hold them harmless from any losses, costs, expenses, obligations or claims, including reasonable outside attorneys’ fees, arising out of the Jediah Parties’ breach hereof or the rendition of the Services hereunder or the Rights granted hereunder because of any breach of any warranty undertaking representation or agreement made or entered into hereunder by Jediah or Jediah Band. The foregoing indemnity shall include, but not be limited to, any claims by any prior or prospective employers allegingCompany’s interference with their contractual commitments or prospective business advantage.
22. Indemnification. The Jediah Parties hereby represent and warrant and agree to indemnify Company as follows:
a. To the best of the Jediah Parties' knowledge, or that which the Jediah Parties should have known exercising reasonable prudence and diligence, the Jediah Parties are the sole owner of all right, title and interest in and to the Rights and services granted hereunder and in the Company Property;
b. To the best of the Jediah Parties’ knowledge, or that which the Jediah Parties should have known exercising reasonable prudence and diligence, neither Jediah or Jediah Band has previously granted, assigned, mortgaged or hypothecated, nor will it grant, assign, mortgage or hypothecate (other than to Company as provided herein) any right, title or interest which it has ever acquired or owned or will ever acquire or own in and to the Company Property or any part thereof to any person, firm or other entity;
c. To the best of the Jediah Parties’ knowledge, or that which Employee should have known exercising reasonable prudence and diligence, no rights of any third party are or will be violated by the Jediah Parties entering into or performing this Agreement, and neither of the Jediah Parties has made and shall hereafter make any agreement with any third party which could interfere with the Rights or Services granted to Company hereunder or the full performance of the obligations of the Jediah Parties hereunder;
d. To the best of the Jediah Parties’ knowledge, or that which the Jediah Parties should have known exercising reasonable prudence and diligence, the exploitation or any other use of the Rights or Services herein granted shall not defame or constitute a libel or slander of any person or entity or violate any copyright, right of privacy or publicity, or any other right of any person or entity;
e. To the best of the Jediah Parties’ knowledge, or that which the Jediah Parties should have known exercising reasonable prudence and diligence, there are no adverse claims to or against the Company Property and/or the Rights or Services granted herein by any person, firm or corporation nor is there pending any litigation, or threat of litigation concerning the Company Property, and/or the Rights and Services granted hereunder;
f. Neither the Jediah Parties has produced or assigned any rights to any third party in connection with the production of any musical work comprising the Company Property, and there are no other contracts, agreements or assignments affecting the Jediah Parties’ rights in and to the Company Property and/or the Rights or Services hereunder;
g. The Jediah Parties hereby indemnify and hold harmless Company (and its affiliated companies, successors, assigns, and the Manager, officers, employees, attorneys, agents and representatives of the foregoing) from any damages, losses, liabilities, costs, penalties, guild fees or other awards or expenses of any kind arising from any claim, demand, or action inconsistent with any agreement, warranty or representation, or assignment by the Jediah Parties in this Agreement, any other agreement between the Jediah Parties and Company or between the Jediah Parties and a third party, or involving any third party's claim to an amount payable hereunder; and
h. The Jediah Parties acknowledge that the Rights granted to Company hereunder are of a unique, extraordinary and intellectual character, the loss of which cannot be adequately compensated in damages in an action at law, and therefore the Jediah Parties acknowledge that Company shall be entitled to injunctive and other equitable relief to prevent or curtail any breach or threatened breach of this Agreement by either of the Jediah Parties.
Concurrently herewith, the Jediah Parties shall execute the Short Form Assignment attached hereto as Exhibit "__" and incorporated herein by this reference and, at Company's request, the Jediah Parties will execute or cause the execution of any and all additional documents and instruments reasonably deemed by Company to be necessary or desirable to effectuate the purposes of this Agreement.
23. Results and Proceeds. The results and proceeds of the Jediah Parties’ Services and Rights granted hereunder including, without limitation, any works of authorship resulting from the Jediah Parties’ Services during their engagement with Company and/or any of its affiliates and any works in progress, shall be works-made-for-hire and Company shall be deemed the sole owner throughout the universe of any and all Rights of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized or developed, with the right to use the same in perpetuity in any manner Company determines in its sole discretion without any further payment to the Jediah Parties whatsoever. If, for any reason, any of such results and proceeds shall not legally be a work-for-hire and/or there are any rights which do not accrue to Company under the preceding sentence, then the Jediah Parties hereby irrevocably assign and agree to quitclaim any and all of the Jediah Parties’ right, title and interest thereto including, without limitation, any and all copyrights, patents, trade secrets, trademarks and/or other rights of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized or developed to Company, and Company shall have the right to use the same in perpetuity throughout the universe in any manner Company determines without any further payment to the Jediah Parties whatsoever. The Jediah Parties shall, from time to time, as may be reasonably requested by Company, do any and all things which Company may deem useful or desirable to establish or document Company’s exclusive ownership of any and all Rights in any such results and proceeds, including, without limitation, the execution of appropriate copyright and/or patent applications or assignments. To the extent either of the Jediah Parties has any rights in the results and proceeds of the Jediah Parties’ Services hereunder that cannot be assigned in the manner described above, the Jediah Parties unconditionally and irrevocably waive the enforcement of such rights. This Paragraph 27. is subject to, and shall not be deemed to limit, restrict, or constitute a waiver by Company of any rights of ownership to which Company may be entitled by operation of law by virtue of Company or any of its affiliates.
24. Right to Termination. Nothing herein shall require Company to use the Jediah Parties’ Services. Company shall be entitled to terminate the Jediah Parties’ Services at any time, and Company shall have fully discharged its obligations hereunder by payment to the Jediah Parties of the applicable compensation specified hereunder, including contingent compensation, if any, which shall have accrued and expense reimbursement for expenses incurred prior to termination of the Jediah Parties’ Services (which payment shall be subject to any offset or mitigation for amounts earned by the Jediah Parties during the remainder of the Term or Service Term hereof).
25. Employment and Tax Papers. All of the Jediah Parties’ obligations in this Agreement are expressly conditioned upon the Jediah Parties completing and delivering to Company an Employment Eligibility Verification ("Form I-9") (in form satisfactory to Company) and in connection therewith, the Jediah Parties submitting to Company original documentation demonstrating their employment eligibility. Company shall be the sole judge of the Jediah Parties’ satisfactory completion of their obligations under this Paragraph 25.
26. No Waiver. The failure of a Party to insist upon strict adherence to any term of this Agreement shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement.
27. Notices. All notices which either Party is required or may desire to serve upon the other may be served either personally or by depositing the same in the United States mail addressed to the party to be served as follows:
To Company: Attention: Bruce Warila, Manager
Table 18, LLC
To the Jediah Parties: Attention: Jediah Jarvais
Either Party may by written notice designate a different address for giving of notices. The date of mailing of any such notices shall be deemed to be the date of service hereof.
28. Severability. If any one or more provisions contained herein shall be held or determined for any reason whatsoever to be invalid or unenforceable, either in whole or in part, then such affected provisions, or portion thereof, shall be curtailed and limited only to the extent necessary to bring them within the legal requirements and shall be deemed separable and independent from the remaining covenants or provisions hereof and shall nevertheless in no way affect the validity of any of the other provisions hereof.
29. Governing Law. Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS APPLICABLE TO AGREEMENTS MADE IN AND WHOLLY TO BE PERFORMED IN THAT JURISDICTION, AND THE PARTIES HERETO SUBMIT AND CONSENT TO THE JURISDICTION OF THE COURTS PRESENT IN THE COMMONWEALTH OF MASSACHUSETTS IN ANY ACTION BROUGHT TO ENFORCE (OR OTHERWISE RELATING TO) THIS AGREEMENT.
30. Confidentiality Agreement. This Agreement, together with the fully executed Exhibit “C,” attached hereto and incorporated herein by this reference, the fully executed standard Company Confidentiality Agreement, attached hereto and incorporated herein by this reference, the Term Sheet, Operating Agreement, and the Contribution Agreement, and all other written agreements between the Parties contain the full and complete understanding between the Parties and supersedes all prior agreements and understandings pertaining hereto and cannot be modified except by a written instrument signed by the Jediah Parties and by an authorized officer of Company. This Agreement and all questions arising in connection therewith shall be governed by the laws of theCommonwealth of Massachusetts. The Jediah Parties’ sole and exclusive remedy for Company’s breach or termination of this Agreement or any term hereof shall be an action at law for damages, and the Jediah Parties irrevocably waive any right to seek and/or obtain rescission and/or equitable and/or injunctive relief.
31. Amendment. This Agreement may be amended only by a written agreement executed by each of the Parties hereto. No amendment of or waiver of, or modification of any obligation under this Agreement will be enforceable unless set forth in a writing signed by the Party against which enforcement is sought. Any amendment effected in accordance with this section will be binding upon all parties hereto and each of their respective successors and assigns. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. No waiver granted under this Agreement as to any one provision herein shall constitute a subsequent waiver of such provision or of any other provision herein, nor shall it constitute the waiver of any performance other than the actual performance specifically waived.
32. Arbitration. Any claim or controversy that arises out of or relates to this Agreement, or the breach of it, shall be settled by arbitration in accordance with the rules of the American Arbitration Association. Judgment upon the award rendered may be entered in any court with jurisdiction.
33. Liquidated Damages. Forfeiture. The equity interest and profit participation of Jediah in the Company as set forth in the Operating Agreement (“Jediah’s Company Interest”) shall be subject to the following forfeiture provisions:
Jediah’s Company Interest shall be immediately vested in Jediah, but shall be subject to partial forfeiture in the event of termination for cause (or if Jediah terminates his employment) hereunder subject to the following schedule:
(i) 33.3% of Jediah’s Company Interest shall not be subject to forfeiture in the event of termination, but the remainder of Jediah’s Company Interest shall be subject to forfeiture as set forth hereunder;
(ii) Year 2 – in the event that Jediah is terminated or terminates employment within two years of the date of this Agreement, Jediah’s Company Interest shall be forfeited in the amount of 66.3% of Jediah’s Company Interest existing at the time of termination, and Jediah shall only be entitled to retain 33.3% of Jediah’s Company Interest; and
(iii) Year 3 – in the event that Jediah is terminated or terminates employment in the third year of the Service Term, Jediah’s CompanyInterest shall be forfeited in the amount of 33.3% of Jediah’s Company Interest existing at the time of termination, and Jediah shall only be entitled to retain 66.3% of Jediah’s Company Interest.
The certificate reflecting Jediah’s Company Interest shall be held in escrow by counsel to the Company, pending the performance of this Agreement by Jediah. In the event of termination or upon performance of the Agreement, counsel to Company shall release to the Employee the amount of Jediah’s Company Interest to which Jediah shall be entitled, subject to the forfeiture provisions hereunder, and the forfeiture shall be reflected in the books and records of the Company. Any forfeiture of Jediah’s Company Interest shall be offered for purchase to the other key employees of the Company on a pro rata basis for a purchase price to be determined by the Company.
Jediah shall be responsible for obtaining his own personal tax advice on the issuance of Jediah’s Company Interest to Jediah.
Without waiving any of the Company’s rights under this Agreement, if this Agremeent is terminated for cause or terminated by Jediah, the Company shall be entitled to damages to be determined by a fair and independent appraiser as just and reasonable liquidated damages to compensate the Company for the costs, expenses, and damages in connection with a breach of this Agreement.
IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Agreement as of the date first written above.
TABLE 18, LLC
Its: Authorized Signatory
ACCEPTED AND AGREED:
Jediah Jarvais, individually
Jediah Jarvais, as a member
of the Jediah Band
SHORT FORM ASSIGNMENT OF RIGHTS
KNOW ALL MEN BY THESE PRESENTS: That the undersigned, for value received, hereby sells, assigns, transfers and grants in perpetuity unto Company (Table 18, LLC), and its successors and assigns (herein called "Assignee"), in and to the undersigned's contributions to the original work reflected in the Company Property (as defined in the Agreement)(which, includes, but is not limited to the composition, music, master recordings, lyrics, title, movements, themes, contents, sequences and other versions thereof, now existing and/or hereinafter devised) and such Rights shall include, but not be limited to, all copyrights (and renewals and extensions thereof), all forms of: video, motion picture, television, digital television, video and computer games, videocassette, video or laser disc, any computer-assisted media (including but not limited to CD-ROM, CD-I and similar disc systems, interactive media and multi-media, and any other devices and/or methods now existing and/or hereinafter devised), all public performance, video, character, sequel, remake, theme park, sound record, stage play, merchandising and all allied, ancillary and subsidiary rights of every kind and nature, throughout the universe and in perpetuity, in and to the Company Property, as more particularly set forth in and subject to the termsand conditions of the Agreement.
The undersigned hereby agrees to obtain or cause to be obtained all United States copyrights in and to said Property, whether or not referred to herein, and hereby assigns said Rights under said copyrights to Assignee; and the undersigned hereby irrevocably appoints Assignee as attorney in-fact, with full and irrevocable power and authority to do all such acts and things, and to execute, acknowledge, deliver, file, register and record all such documents, in the name and on behalf of the undersigned, as Assignee may deem necessary or proper in the premises to accomplish the same.
Assignee is also hereby empowered to bring, prosecute, defend and appear in suits, actions and proceedings of any nature under or concerning all copyrights in and to said Property and all renewals thereof, or concerning any infringement thereof, or interference with any of the Rights hereby granted under said copyrights or renewals thereof, in its own name or in the name of the copyright proprietor, but at the expense of Assignee, and, at its option, Assignee may join such copyright proprietor and/or the undersigned as a party plaintiff or defendant in any such suit, action or proceeding.
Jediah Jarvais, individually
Jediah Jarvais, as a member of
COMMONWEALTH OF MASSACHUSETTS)
COUNTY OF WORCESTER)
On __________________, 2006, before me, personally appeared Jediah Jarvais, individually, and as a member of the Jediah Band, personally known to me to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same, and that by his signature on the instrument the person executed the instrument.
Witness my hand and official seal.
Notary's Signature (Seal)