These terms (“Licence Terms”) describe the rules of your relationship with CONNECT Music Licensing Services Inc. (“CONNECT”, “us”, “we” or “our”) and are part of your legal agreement with us, so please read them carefully. If you have a prior agreement with CONNECT, this agreement amends and consolidates all prior agreements and amending agreements you may have previously entered into with CONNECT.
1. Capitalized Terms
All capitalized terms used herein have the meanings set out in Section 13, or in the specific licence form that you have entered into with CONNECT (the “Licence Form”).
2. About CONNECT
CONNECT is an authorized agent of the companies and individuals that own and/or hold the exclusive right of reproduction in certain Sound Recordings and that have authorized CONNECT to act as their non-exclusive licensing agent (the “Members”). Members are identified and listed on our website, which list may be amended by CONNECT from time to time.
3. Rights Granted
The rights granted to you are specifically described in the Licence Form. All rights not specifically granted herein are reserved by CONNECT. For clarity, Sound Recordings, all performances embodied thereon and all copyrights and other rights in and to Sound Recordings, are and shall remain the sole property of the Members. Any copyright and all other rights in connection with Sound Recordings and Copies of Sound Recordings authorized hereunder are specifically reserved by CONNECT.
4. Limitations on Rights Granted
The limitations below apply to all rights granted by CONNECT under any Licence Form, and are in addition to any specific restrictions contained in the Licence Form:
- Canada-only. Rights granted are limited to the Territory.
- The Member has Takedown rights. Rights granted are subject to CONNECT’s right to takedown any Sound Recording(s) as directed by any Member at any time.
- Use in Promotion is Limited. Rights granted to use clips of Sound Recordings for promotional purposes in the Licence Form (if applicable) are expressly limited to promoting the availability of such Sound Recordings within the Licensee’s authorized service
- No Editing. Sound Recordings may not be edited (other than for length or as minimally necessary to include such Sound Recordings in the Licensee’s service) and may not be used in a manner that might reasonably be considered to imply an endorsement of any brand, product, or service, including the Licensee’s service. Cross-fading of songs may be permitted in certain circumstances, with prior written consent from CONNECT.
- Restricted Artists. Sound Recordings by certain artists are restricted from use in some licensed services. It is your obligation to ensure that no Sound Recordings by these restricted artists are included in your service, and to stay up to date on any additions to the list (found on our website) during the Term.
- No Synchronization with Video. Unless specifically authorized in your Licence Form, you may not synchronize Copies of Sound Recordings with visual images (including moving images).
- Multiple Tracks from One Album Restricted. You agree that your service will, at all times, comply with the rules commonly referred to as the “performance complement”, which limit the amount of times a service may transmit Sound Recordings from a specific artist or album during a specific time period, as follows:
- No more than 4 tracks by the same artist (or from a compilation album) may be transmitted to the same listener within a 3 hour period (and no more than 3 of those tracks may be transmitted consecutively); and
- No more than 3 tracks from the same album may be transmitted to the same listener within a 3 hour period (and no more than 2 of those tracks may be transmitted consecutively).
- Album Artwork. Only album artwork (as included in the original album released by Member) may appear on the display screen while Sound Recordings play, unless otherwise approved by CONNECT.
- Artist Likeness. Unless expressly authorized in the Licence Form, Licensee may not use the name or likeness of any recording artist name or likeness associated with the Sound Recordings in any promotions or advertisements including without limitation promotion of the applicable Licensee service.
- Ethical Use. The Sound Recordings will be used in an ethical and professional manner which will not damage or reflect negatively on the reputation of Members, CONNECT, or a recording artist.
- No Sale. Licensee shall not directly or indirectly sell or otherwise dispose of, pledge, mortgage or in any way encumber Sound Recordings, whether alone or as incorporated into a product licensed hereunder, and Licensee shall similarly bind all parties dealing with such property, including Licensee’s Commercial Subscribers or end users (if applicable).
- Advertising is restricted. In-Store Advertising or commercial messages on Digital Programs containing Copies of Sound Recordings is expressly restricted unless permitted in the Licence Form. If permitted, In-Store Advertising must:
- relate to products or services sold or provided by the Commercial Subscriber Leasing the Digital Programs containing In-Store Advertising;
- be separated by a discernible buffer from the beginning and end of any Sound Recording;
- be audio-only (video advertising is prohibited other than static images);
- not use a Sound Recording as a soundtrack; and
- not be included if it promotes tobacco or cannabis products, or is a political
5. Packaging and Display Requirements
- Licensee agrees to furnish CONNECT with copies of all artwork, advertising and promotional material in connection with each product licensed hereunder, upon request, and to make any revisions requested by CONNECT. Upon request and without charge, Licensee shall supply copies of or access to the Licensee’s service to CONNECT.
- Licensee may release products containing Sound Recordings only under trade names or trademarks owned by or licensed to Licensee. Licensee may not use any trademarks or logos of Members, or said Members’ or CONNECT’s name, directly or indirectly, except where specifically authorized by CONNECT, in writing in advance.
- Prior written consent from CONNECT must be received by Licensee before it may co-brand, white label, syndicate, or bundle its service with third party services.
6. Approvals & Security
- Licensee agrees, to the extent applicable to the product licensed in the Licence Form, to seek approval for Sound Recordings it plans to use by logging in to the CONNECT web portal and searching the database for the applicable title:
- if the title exists in the database, selecting the title equals auto-approval (except for titles by restricted/sensitive artists); and
- if the title does not exist in the database, Licensee must add it as a “new request” which will then be reviewed by CONNECT and sent to the applicable Member for approval. Licensee will be notified when the request has been processed.
- Licensee agrees to ensure it has reasonable security measures in place to prevent unauthorized reproduction of Sound Recordings licensed for use hereunder, and to promptly notify CONNECT of any unauthorized reproduction, advertising, or use of which it becomes aware.
Licence Fees and Reports
- You shall pay licence fees and all applicable taxes, as set out in the Licence Form. CONNECT reserves the right to increase licence fees upon 60 days’ notice to you prior to the expiration of the Term and/or each renewal period included within the Term. CONNECT will supply you with the required reporting format for your License Form.
- If you reside outside Canada (meaning do not have a Canadian office), the applicable rate of tax to be applied will be 0%. If you do have a Canadian head office, the applicable rate of tax to be applied will be the rate of tax applicable in the province in which your head office is located.
- You shall send Licence fees and reports required in the Licence Form to: 1235 Bay Street, Suite 900, Toronto, M5R 3K4, ATTN: CONNECT Reporting. If you have questions regarding the same, send them to: email@example.com.
8. Sound Recording Source
CONNECT and Members have no obligation to provide Licensee with commercially recorded products of Sound Recordings or any other materials of any kind. Licensee agrees to only Copy Sound Recordings in the Territory, and directly from authorized commercial recorded music products, including, but not limited to, legal digital downloads, compact discs, DVDs or other carriers of recorded music that are produced by Members that own and/or hold an exclusive right of reproduction in such Sound Recordings. All costs incurred to make such Copies are Licensee’s sole responsibility.
- Either party may terminate a Licence Form if the other party is in default of any of its obligations to the other party (including remedies requested during technical or financial audits) and the defaulting party does not cure the default within 30 days of receipt of notice from the non-defaulting party specifying the default. The failure by the defaulting party to cure the default within the time specified above shall result in the automatic termination of this Agreement.
- Either party may terminate this Agreement for cause on at least 30 days prior written notice to the other party in the event that: (i) the other party is unable to pay its liabilities when due, makes an assignment for the benefit of creditors, files a voluntary assignment in bankruptcy, or is adjudicated bankrupt or insolvent; or (ii) any receiver is appointed for the other party’s business or property; or (iii) any trustee in bankruptcy is appointed for the other party.
- Upon the expiration, termination or cancellation of the Term for any reason whatsoever, the licence granted to you herein shall terminate and you agree to immediately terminate all leases to third party subscribers or end users (if applicable) of your service and request the return of any copies of Sound Recordings that you have provided to such subscribers or end users. It is your obligation to destroy or erase all Sound Recordings created or used under the Licence Form. Upon CONNECT’s written request, you will promptly furnish a sworn affidavit that all such Sound Recordings were destroyed or erased.
10. Audit Rights
- Technical Audit. During the Term, but no more than once in any 12 month period, CONNECT shall have the right on reasonable prior written notice to conduct an audit of Licensee’s compliance with its technical obligations hereunder (e.g. security, source copies, display requirements, advertising, etc.), and to request that Licensee take remedial steps within 30 days to cure any breaches noted.
- Financial Audit. During the Term, and up to 2 years thereafter, Licensee shall maintain (and shall cause its Commercial Subscribers (if applicable) to maintain, if applicable) accurate and complete Books in accordance with GAAP applied on a consistent basis, which shall include, at a minimum, all documentation needed by CONNECT to compute and verify the Fees payable by Licensee and Licensee’s compliance with its other financial and reporting obligations under this Agreement. CONNECT is expressly authorized to inspect the Books upon reasonable written notice and no more than once in each 12 month period of the Term. If this inspection shows a shortage between the Fees due and the Fees paid hereunder, Licensee shall immediately pay such shortfall to CONNECT. If there is a shortage of greater than 10% of the payments due, Licensee shall bear the reasonable expenses and costs of the inspection.
The exercise or non-exercise by CONNECT of its audit rights in (a) or (b) shall not affect Licensee’s obligations or be deemed a waiver by CONNECT of any of its rights under this Agreement.
11. Representations, Warranties, and Covenants
- Licensee warrants that it has the power and authority to enter into this Agreement and to fully perform its obligations hereunder. Licensee covenants that it shall undertake to obtain all necessary consents, clearances, and licences, and make all necessary payments of any kind whatsoever to any third party with respect to the use of Sound Recordings and musical works embodied in any Copies of Sound Recordings by Licensee, including, without limitation:
- payments to any performing rights society in respect to the public performance of Sound Recordings and the musical compositions and any mechanical rights payments for reproduction of musical works embodied in Sound Recordings; and
- any and all payments required by any applicable union or collective bargaining association.
- Licensee will, at all times, indemnify and hold CONNECT and each Member harmless from and against any and all claims, damages, liabilities, costs and expenses arising out of the unauthorized use, Copying or reproduction of Sound Recordings and/or any breach by Licensee of any warranty, representation or condition in this Agreement. Licensee shall reimburse CONNECT on demand for any payment made by CONNECT with respect to any liability or claim to which the foregoing indemnity applies, provided that such liability or claim has been reduced to judgment or settled pursuant to a settlement approved by Licensee, which approval Licensee shall not unreasonably or arbitrarily withhold.
- CONNECT represents and warrants that as non-exclusive authorized agent of Members and associated labels, it has the authority to enter into this Agreement, to perform its obligations hereunder and to license and grant to Licensee the limited rights contained in the Licence Form.
- Approvals. All approvals from CONNECT referenced herein must be in writing and received in advance.
- Severability. If any of the provisions of this Agreement or their application to any person or circumstance are to any extent illegal, invalid or unenforceable, the remainder of this Agreement shall be construed as if such illegal, invalid or unenforceable provision had never been contained in it.
- Governing Law. This Agreement shall be deemed to have been made in the Province of Ontario and shall be governed and construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein. All claims and proceedings arising from or related to this Agreement, shall be adjudicated solely by a court or by a tribunal of competent jurisdiction in the Province of Ontario, in the judicial district of Toronto and the parties hereby attorn to the exclusive jurisdiction thereof.
- Assignment. This Agreement, and any and all rights granted to Licensee hereunder shall not be assigned, sub-contracted, or otherwise transferred by Licensee without CONNECT’s approval. If Licensee is approved to use a third party distributor to distribute products or services containing Sound Recordings, Licensee must ensure that each third party distributor executes a distribution agreement that shall bind the third party distributor(s) to all applicable terms and conditions of this Agreement, and ensure that CONNECT is a third party beneficiary of those agreements. Licensee shall terminate any third party distribution agreement(s) with any third party distributor(s) that cause or induce Licensee to breach any of the terms and conditions of this Agreement. Licensee agrees that it is responsible to CONNECT for any acts and omissions of its third party distributor(s).
- Language. The parties confirm that it is their wish that this Agreement as well as all other documents relating to this Agreement, including notices, be drawn up in English only. Les parties aux présentes confirment que c’est leur volonté que la présente convention de même que tous les documents, y compris les avis, s’y rattachant, soient redigés en anglais seulement.
- Confidentiality. Either party may disclose the existence of this Agreement to any person, firm or corporation. However, the specific terms and all transactions carried on pursuant to this Agreement, including all information exchanged between the parties in relation to technical specifications, audits, grant of rights and the contents of any correspondence or dealing between the parties hereto respecting such matters shall at all times be treated in a confidential manner by both parties hereto and shall not be disclosed by either party to any other person or to any firm or corporation without the express prior written consent of the other party, save and except for such confidential disclosure as may be reasonably necessary to either party’s solicitors, directors, officers, auditors, subsidiaries or parent firms or corporations or save and except disclosed pursuant to an order of a court or tribunal of competent jurisdiction.
- Survival. The obligations in these sections will survive the expiry or other termination of this Agreement: 1, 9, 10(b), 11-13.
Notice. Any notices, demands or other communications given pursuant to this Agreement shall be made in writing and shall be deemed to have been made and properly given if sent by registered mail or e-mailed (a notice by email shall be presumed to have been received the day it is transmitted, and by registered mail on the date of receipt) to CONNECT’s address set out below, and to Licensee’s address as noted on the Licence Form:
CONNECT MUSIC LICENSING SERVICE INC.
85 Mowat Avenue
Toronto, ON M6K 3E3
Phone: (416) 922-8727
Facsimile: (416) 967-9415
Attention: Licensing Manager
- Entire Agreement. This Agreement and the Licence Form(s) entered into between CONNECT and Licensee contain the entire understanding of the parties hereto with respect to the subject matter and replace all previous agreements between the parties. The Licence Form may not be amended or modified except by a written instrument signed by both parties, except that these Licence Terms may be amended from time to time without notice from CONNECT to Licensee. A waiver by CONNECT of any terms or condition of this Agreement in any instance shall not be deemed or construed as a waiver of such term or condition for the future or of any subsequent breach of this Agreement. All remedies, rights, undertakings, obligations and agreements contained in this Agreement shall be cumulative and none of them shall be in limitation of any other remedy, right, undertaking, obligation or agreement of either party.
- Non-precedential. This Agreement and the Licence Form(s) are non-precedential, do not form the basis of a future understanding between CONNECT and Licensee, and are intended to facilitate the lawful operation of Licensee’s service during the Term, so that the parties can in good faith assess in more detail the nature and effect of the licensee service and appropriate licensing terms.
For the purposes of this Agreement,
- “Books” means records and books of account solely related to sales and/or distributions of Sound Recordings hereunder, including payments required to be made by Licensee pursuant to this Agreement;
- “Commercial Subscribers” mean third party commercial users of Licensee’s licensed product or service excluding any broadcasting undertaking or Internet uses, and excluding any library or other institution engaged in the practice of lending Sound Recordings.
- “Compression” means an industry standard method that can be employed by Licensee to achieve data reduction of digital audio or video files of Sound Recordings copied by Licensee to make Streams or Downloads and “Compress” and “Compressed” shall have corresponding meanings.
- “Copy” and “Copying” means the authorized reproduction of certain Sound Recordings for the sole purpose of offering the Licensee’s service, and a “Copy” means a reproduction made for such purpose.
- “Encrypted” means an industry standard method which only Licensee can employ to secure access to digital audio or video files of Sound Recordings Copied by Licensee to make Streams and which is used by Licensee to prevent unauthorized access and unauthorized copying of Sound Recordings.
- “In-Store Advertisements” shall mean promotional messages included in Licensee products that are produced specifically for Licensee’s Commercial Subscribers promoting said Commercial Subscribers business or services.
- “Music Video” means original master video recordings manufactured and issued under the label(s) of a Member now available or created during the Term.
- “Sample” means up to 30 seconds of a Sound Recording.
- “Sound Recording” means any analogue or digital audio recording of a performance of a musical work manufactured and issued under the label(s) of a Member now available or created during the Term of this Agreement.
- “Term” means the duration of the Agreement as set out in the Licence Form.
- “Territory” means Canada.