PUBLISHING ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of March 18, 2011 by and between BUG MUSIC, INC. (hereinafter referred
to as "Bug") and Jimmy Songwriter doing business as Roadhouse Publishing (ASCAP) (or any other designated
publishing company name) (hereinafter sometimes referred to, individually and collectively, as "Publisher").
1. This Agreement is made with respect to all musical compositions, heretofore or during the term hereof,
written or composed, in whole or in part, or owned or controlled, directly or indirectly, by Publisher or any firm
or corporation affiliated with or related to it or which it shall form, a complete schedule of which, as of the date
hereof, is set forth on Schedule A attached hereto (such musical compositions being hereinafter referred to as
the Compositions). During the term hereof, Bug shall have the exclusive right to administer and exploit the
Compositions throughout the world; to print, publish, sell, use and license the performance and use of the
Compositions throughout the world; and to execute in Publisher's name any licenses and agreements affecting
the Compositions, including, but not limited to, licenses for mechanical reproduction, public performance and
synchronization uses, and to assign in the normal course of business or license all such rights to third parties.
Bug in its discretion or at the request of Publisher, and on receipt of all necessary information, shall register in
the name of Publisher claims to copyright in the Compositions together with any other documents which Bug
deems necessary to register in the United States Copyright Office.
2. Bug shall collect all Gross Receipts (as defined below) which are earned by and derived from the
Compositions: (a) prior to the term hereof ("Pre-Term Receipts"), or (b) during the term hereof, regardless of
when such Pre-Term Receipts or other Gross Receipts are paid. Pre-Term Receipts shall only be collectible by
Bug to the extent that they have not been collected prior to the term hereof and are not subject to any collection
rights of a third party. If the collection right of a third party with respect to Pre-Term Receipts expires during
the term hereof, Publisher shall notify Bug thereof in writing promptly following such expiration so that Bug
may collect any Pre-Term Receipts remaining to be collected. "Gross Receipts" is defined as any revenue
derived from the Compositions less amounts paid to or deducted by foreign subpublishers, sublicensees,
collection agencies and local performing and mechanical rights societies. Gross Receipts shall include, without
limitation, mechanical royalties, synchronization fees, print income and the "writer's" and "publisher's share" of
public performance income, provided, however, that the composers of any Compositions hereunder shall have
the right to collect the "writer's share" of any such income directly from the applicable performing rights
society.
3. (a) For its services hereunder, Bug shall be paid its Reasonable Expenses (as defined below) as set forth in
subparagraphs (b)(i) and (ii) below, plus ten percent (10%) of the Gross Receipts derived from the Publisher
from the Compositions; provided, however, that Bug shall be entitled to an additional twenty-five percent
(25%) of the Gross Receipts derived from cover recordings of the Compositions secured by Bug. The term
"cover recording" shall mean any recording of a Composition by any person other than the composer or
composers of such Composition, or placement of a Composition in a motion picture, television program or
commercial. In the event there shall be both cover records and other records released of any Composition
hereunder, then, for the purposes of the computation of Bug's fees, performance income with respect to any
such Composition shall be divided into two (2) categories in the same proportion that mechanical income is
earned during the period that any such performance income is earned, and the applicable percentages hereunder
paid with respect to any such mechanical income shall be paid with respect to each such category of
performance income.
(b) "Reasonable Expenses" are defined as the following: (i) actual out-of-pocket non-overhead
administrative and exploitation expenses of Bug with respect to the Compositions including, without limitation,
registration fees and the costs of transcribing for lead sheets; provided, however Bug shall incur no single
expense in excess of Two Hundred Dollars ($200.00) without the consent of Publisher; and (ii) attorneys' fees,
if any, actually paid by Bug for any agreements (other than the present Agreement) affecting the Compositions.
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(c) Songwriter royalties shall be paid to any composer (including Publisher, if applicable) of any
Composition hereunder. Said royalties shall be paid pursuant to any songwriter agreement between any such
composer and Publisher or Publisher's predecessor in interest, if any, and such accounting to any such composer
(other than Publisher, if applicable) shall be on a semi-annual basis unless required otherwise by such
agreement. True copies of any such agreement shall be promptly submitted by Publisher to Bug. Publisher
shall instruct Bug in writing whether Bug shall pay on Publisher's behalf any such composer such royalties or
pay such royalties to Publisher, in trust, for payment over by Publisher to any such composer. The royalties
payable to the composer(s) of any Composition hereunder pursuant to any songwriter agreement as aforesaid
shall not exceed (or, in the event no songwriter agreement shall exist, shall be) the following: the writer's share
[one-half (1/2) of all net sums actually received in the United States] (less any costs for collection) specifically
allocable to any such Composition for mechanical rights, print rights, synchronization rights, and for any other
use or exploitation of such Composition anywhere in the world. The compensation specified hereinabove shall
be payable solely to any such composer in instances where such composer is the sole author of any such entire
Composition, including the words and music thereof. However, in the event that one or more other songwriters,
including writers of lyrics to any such Composition, are authors along with such composer on any such
Composition, then the compensation specified in the immediately preceding subparagraph shall be divided and
paid in equal shares to each such author of any such Composition, unless the composers thereof shall otherwise
agree in writing.
4. Each party hereto gives the other the equal benefits of any warranties which it has obtained or shall obtain
under any agreement affecting the Compositions, including songwriters' contracts. Publisher further represents
and warrants that (i) the exercise by Bug of any of the rights granted hereunder will not violate or infringe upon
any common law or statutory rights of any third party, including, without limitation, contractual rights,
copyrights and rights of privacy; (ii) it presently does, and during the term hereof shall, maintain exclusive,
valid songwriters' contracts with any composers who may write or co-write any Compositions hereunder which
are published by Publisher and that it shall not breach said contracts or permit any breach thereof; and (iii) it
has not heretofore accepted nor will it during the term hereof accept an advance of publishing royalties from its
record company or from any other party without Bugs consent. With respect to any composer who may write
or co-write any Composition hereunder, Bug shall have the right to use the name and likeness of any such
composer for advertising and purposes of trade in connection with the exploitation of the applicable
Composition(s).
5. Publisher indemnifies and holds Bug, its assigns, licensees and its and their directors, officers,
shareholders, agents and employees harmless from any liability, including, without limitation, reasonable
counsel fees and court costs, arising out of or connected with or resulting from any claim inconsistent with any
of the warranties, representations or agreements, express or implied, and made by Publisher in this Agreement.
Bug shall give Publisher prompt written notice of any claim or action covered by said indemnity, and Bug shall
have the right to withhold payment of any and all monies hereunder in reasonable amounts related to such claim
or action pending the disposition thereof.
6. Bug shall have the right but not the obligation to prosecute, defend and settle all claims and actions with
respect to the Compositions and the copyrights or other rights with respect to the Compositions; provided,
however, Bug shall not settle claims or actions without the consent of Publisher. In the event of a recovery by
Bug or Publisher of any monies as a result of a judgment or settlement, such monies shall be divided between
Bug and Publisher in the same shares as provided in paragraph 3 above, after first deducting the expenses of
obtaining said monies, including reasonable counsel fees. Publisher shall have the right to provide counsel for
itself, to assist in or assume the prosecution or defense of any such matter, but at its own expense. Any
judgments against Bug and any settlements by Bug of claims against it respecting any of the Compositions,
together with costs and expenses, including counsel fees, shall be subject to the indemnity provisions of
paragraph 5 hereof, and Publisher's indemnity payments thereunder shall be paid to Bug from any and all sums
that may become due to Publisher hereunder, or promptly upon demand by Bug.
7. Statements as to all monies payable hereunder shall be sent by Bug to Publisher within sixty (60) days
after the end of each calendar quarter for each such preceding quarterly period. Publisher shall be deemed to
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have consented to all royalty statements and other accounts rendered by Bug to it, and said statements and other
accounts shall be conclusively binding upon Publisher and not subject to any objection for any reason, unless
specific objection in writing, setting forth the basis thereof, is given by Publisher to Bug within two (2) years
after the date that such statement is rendered. Publisher may, at Publishers own expense, audit Bugs books
and records directly relating to the Compositions that report the royalties or other monies payable hereunder.
Publisher may perform such audit for the purpose of verifying the accuracy of any statement rendered to
Publisher hereunder. Publisher may audit a particular statement only once and only within two (2) years after
the date such statement is rendered. Any such audit by Publisher shall be conducted by a reputable independent
certified public accountant experienced in music publishing industry audits ("Auditor"), who is not engaged at
that time in any other audit of Bug, its controlling entities or any of its or their subsidiaries or affiliates. It shall
be conducted at the place where Bug keeps the books and records to be examined during Bugs usual business
hours and with reasonable prior written notice to Bug. Any such audit shall be conducted in such a manner so
as not to disrupt Bug's other functions and will be completed promptly. The fee to be paid to Auditor shall not
be contingent upon the results of Auditor's inspection. Publisher acknowledges that: Bug's books and records
are strictly confidential; neither Publisher nor Publishers representatives shall reveal any of the contents of
such books and records to any third parties; and Publishers review of such books and records may be subject to
certain restrictions imposed upon Bug by third parties. Auditor shall review his/her tentative written findings
with a member of Bug's finance staff designated by Bug before rendering a report to Publisher so as to remedy
any factual errors and clarify any issues that may have resulted from any misunderstanding(s). Any legal action
against Bug by Publisher with respect to a specific accounting statement or the accounting period to which the
same relates shall be forever barred if not commenced in a court of competent jurisdiction within six (6) months
after Publishers receipt of written notice from Bug rejecting Publishers written claim in connection therewith.
8. (a) The initial term of this Agreement shall be three (3) years from the date of the execution hereof by both
parties as set forth below, and unless written notice of the termination of this Agreement shall have been sent by
either party hereto to the other at least sixty (60) days prior to the expiration of the initial term, then this
Agreement shall be renewed upon a year to year basis, and Publisher, or Bug, shall be required to give notice as
aforesaid for any termination of any such renewal period. If any such notice shall be so given, then any such
termination shall be effective on the first day of the calendar quarter next following the expiration of the initial
term or renewal period, as applicable. Notwithstanding the foregoing, no such notice of termination shall be
deemed effective unless, prior to the date upon which this Agreement is to terminate, Bug shall have recouped
or been paid by Publisher its Reasonable Expenses (as said term is defined herein) theretofore incurred.
(b) When Bug shall license any right or assume the collection obligations of an existing license to one (1)
or more of the Compositions, the term of this Agreement in respect to that license shall extend until (i) three (3)
years after the issuance of said license, or (ii) the termination of the overall agreement, whichever is later.
(c) When Bug shall secure any cover recording of a Composition hereunder the term of this Agreement
with respect to any such Composition shall thereafter extend in perpetuity.
9. The respective addresses of Bug and Publisher for all purposes of this Agreement shall be as set forth
below, until written notice of a new address shall be duly given:
Bug
Publisher
BUG MUSIC, INC.
7750 Sunset Boulevard
Los Angeles, CA 90046
ROADHOUSE PUBLISHING
666 Steamboat Road, Route 66
Nashville, TN 37204
All notices shall be in writing and shall either be delivered by registered or certified mail, postage prepaid or by
facsimile, all charges prepaid. Neither party shall be deemed to be in breach of any of its obligations hereunder
unless and until the party claiming a breach shall have given the other written notice by certified or registered
mail, return receipt requested, specifying the nature of such breach and such other party shall have failed to cure
such breach within thirty (30) days after receipt of such written notice; provided that if the alleged breach is of
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such a nature that it cannot be completely cured within thirty (30) days, the notified party shall not be deemed
to be in breach if such party commences the curing of the alleged breach within such thirty (30) day period and
proceeds to complete the curing thereof with due diligence within a reasonable time thereafter.
10. Bug may enter into subpublishing or collection agreements with, and license or assign this Agreement
and any of its rights hereunder and delegate any of its obligations hereunder to third parties throughout the
world. In the event Bug is or shall be a party to any subpublishing, collection or administration agreement for
any country of the world with a subsidiary or affiliate of Bug, such agreement shall be deemed to be an
agreement with an unrelated third party.
11. Publisher shall at all times, both during the term and thereafter, keep all of Bugs confidential information
in confidence and trust. Publisher shall not use such confidential information other than as expressly permitted
herein or with the prior written approval of Bug. Publisher shall not directly or indirectly disclose to the public
or to any non-essential person and/or entity any of the terms of this Agreement without the prior written
approval of Bug, unless otherwise required to do so by any law established by any government with applicable
jurisdiction.
12. Each party acknowledges and represents that, in executing this Agreement, it has received advice as to
its legal rights from legal counsel and that the person signing on its behalf has read and understood all of the
terms and provisions of this Agreement. Further, each party and their counsel have cooperated in the drafting
and preparation of this Agreement. It shall be deemed their joint work product and may not be construed
against any party by reason of its preparation or word processing.
13. This Agreement sets forth the entire understanding between the parties, and cannot be modified,
terminated or rescinded except by mutual written agreement of both parties hereto. This Agreement shall be
governed and construed under the laws of the State of California applicable to agreements made and wholly
performed therein. The exclusive venue for any action, suit or proceeding arising from or based upon this
Agreement shall be the appropriate state and federal courts located in Los Angeles, California.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the day and year set
forth below.
AGREED TO AND ACCEPTED:
AGREED TO AND ACCEPTED:
BUG MUSIC, INC.
("Bug")
PUBLISHER
("Publisher")
By
By
An Authorized Signatory
Jimmy Songwriter
Its:___________________________
Dated:
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Schedule A
to the Publishing Agreement
between
Bug Music, Inc. and Jimmy Songwriter doing business as Roadhouse Publishing (ASCAP)
dated as of March 18, 2011
(Information to be provided by owner and attached hereto)
Compositions:
Author(s):
Publisher(s):
Initial____________
Date_____________
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