DISTRIBUTION AGREEMENT

1. 1. Description of Service:

   The Distribution Service digitally distributes your music through various Digital Service Providers. You must be a registered user of the Site to use the Distribution Service. Additional information about the Distribution Service is located on www.Rapchat.com.

2. 2. Defined Terms:

   The following terms shall have the following meanings for purposes of these DTOS:

   “Album Release(s)” shall mean the Digital Distribution of multiple Recordings to the DSPs as a single album or extended play (EP) format and not to exceed one hundred (100) tracks.

   “Digital Distribution” or "Digitally Distribute" shall mean the digital distribution of Recording(s) for the sublicensing, sale, public performance, electronic transmission, or other distribution to end users in any media whether now known or existing in the future, including, but not limited to permanent digital downloads, limited or temporary digital downloads, ringtones, ring-back tones, interactive streaming, non-interactive streaming, and cloud services, whether or not a direct or indirect charge is made to receive the transmission and whether or not such transmission results in a specifically identifiable reproduction of any Recording(s) by or for any transmission recipient.

   “Digital Service Provider”, “DSP(s)" shall mean our licensees and the digital Internet consumer stores with respect to which we have agreement(s) (whether directly or indirectly) to Digitally Distribute Recordings. DSPs may change from time to time with the addition or removal of certain Internet consumer stores within our sole discretion, subject only to your right to terminate your use of the Distribution Service as provided in Section 8 of this DTOS below. Singles Releases and Albums Releases may be distributed to all current DSPs. The DSPs applicable to any particular Release will be identified in your Dashboard. With respect to any new DSPs added during the Term of a Release, we may, but are not obligated to, submit your Recording(s) to such new DSPs. With respect to any DSPs removed during the Term of a Release, your Recording(s) may be removed from such DSPs.

   “Rapchat Credit Account” shall mean the account where the Net Income of the Royalties accrued from the Digital Distribution of your Release shall be deposited and held on your behalf until such time as the Royalties are paid out to you pursuant to Section 7 hereof.

   “Rapchat Token” shall mean an in-Service digital token acquired by a User, whether on a per-instance basis, reoccurring / subscription basis, or other means such as in-app credit or promotional basis, that can be redeemed to Digitally Distribute a song by means of the Service. Once acquired, your Rapchat Tokens will be stored in a digital wallet (your “Wallet”) associated with, and accessible through, your Dashboard.

   “Recording(s)” shall mean sound recordings and audiovisual recordings of underlying musical compositions together with (i) associated Recording Materials and (ii) the Reserved Content, if any, submitted therewith, that you submit, or previously submitted, to us for Digital Distribution as Release(s).

   “Recording Materials” shall mean the metadata, copyright management information, artwork, graphics, logos, and any other related materials or information associated with a Recording or configuration of Recordings (i.e. EP, Album, or other configuration).

   “Release(s)” shall mean, as applicable, an Album Release and a Single Release.

   “Reserved Content” shall mean all third-party sound recordings (i.e. 'beats'), including the underlying compositions embodied therein, and any other intellectual property provided to you through the Service for use in your Recordings.

   “Single Release(s)” shall mean the Digital Distribution of a single Recording to the DSPs as a single track.

3. 3. Submission of Materials and Ownership:

   All Recordings, including Recording Materials and any other relevant information, shall be submitted to us for Digital Distribution as Releases from your Dashboard in accordance with and subject to the RTOS, and such submissions shall be deemed Content and subject to all applicable representation, warranties, and agreements thereunder. Without limiting the foregoing, to the extent you do not own any underlying musical compositions, sound recordings, samples, publicity rights, or other materials or content in your Content, it is your obligation to secure all appropriate permissions, clearances, licenses, or other authorizations and agreements, and, as applicable, to pay directly all third-party fees and royalties as may be required, including, but not limited to, with respect to artists, band members, authors, co-authors, copyright owners and co-owners, publishers, producers, or any other person who performed in the making of your Content, and in connection with mechanical royalties, digital phonograph delivery royalties, public performance royalties, payments that may be required under any collective bargaining agreements or statutory schemes, or any other royalties, fees, and/or sums payable with respect to your Content, and at our request, you shall provide us with confirmation of such authorizations and payments which request may include but not be limited to any agreement, license, clearance, receipt, or other documentation concerning the same.

4. 4. Authorization:

   Without limitation of your grant of rights in the RTOS, such rights include the right to Digitally Distribute all Recording(s) as Release(s) and to otherwise format, reformat, and/or use the Recordings to the extent necessary to facilitate such Digital Distribution to the Digital Service Providers you select, including the rights to:

   1. reproduce, convert, and create derivative works of your Recordings and related materials for Digital Distribution of your Release(s);
   2. reproduce, promote, advertise, market, sublicense, sell, publicly perform, display, host, distribute, deliver, transmit, and otherwise exploit and use Recordings and related materials for Digital Distribution of your Release(s);
   3. display any and all lyrics associated with a musical composition embodied in any Recording in connection with the Digital Distribution of your Release(s);
   4. use the name(s), professional name(s), voices(s), likeness(es), photograph(s), video still(s), design(s), images, artwork, logos, trademarks, service marks, biographical materials, and other rights of publicity with respect to materials and information that you provide to us in connection with the Digital Distribution of your Release(s);
   5. in the event that the Release(s) generate any income, collect all income deriving from the Digital Distribution of your Release(s);
   6. exercise all rights granted herein, including the right to edit and publicly perform Recordings and related materials consistent with industry- standards, for purposes of publicizing, promoting, marketing, and advertising the availability of the Recordings for Digital Distribution; and for purposes of creating ringtones, ring-back tones, or for other mobile uses, to the extent applicable for Digital Distribution; and
   7. sublicense any and all rights granted in this Section to DSPs or other licensees.

   Notwithstanding the foregoing, you agree not to use any other Digital Distribution service with respect to (i) any Recording containing Reserved Content or (ii) whether or not a Recording contains Reserved Content, any DSPs except only to the extent that an Internet consumer store is no longer a DSP hereunder. For the avoidance of doubt, Rapchat shall have the exclusive right to Digitally Distribute any Recording containing Reserved Content, unless otherwise agreed to in writing by Rapchat.

5. 5. Distribution service:

   1. Rapchat will submit your Recordings to DSPs for Digital Distribution in accordance with the type of Release you have purchased from us and these DTOS. The scope and type of Digital Distribution provided by each DSP varies in accordance with the particular service(s) any particular DSP offers. By opting into a DSP, you warrant to Rapchat that you have read, understand, and agree to be bound by all of the terms and conditions of that DSP and that you and your Recordings and other content will comply fully with those terms and conditions. Notwithstanding anything to the contrary in these DTOS without limitation, Rapchat reserves the right to decline to distribute or discontinue the distribution of any Recording(s) to any DSP at any time, with or without cause, in our sole discretion.
   2. Each DSP will determine its pricing to its respective customers, as well as format or media and other terms on which it offers recordings (including your Recordings) to its customers, at its discretion using monetization strategies such as permanent digital downloads on a pay-per-unit basis or a subscription fee to be able to stream or temporarily download your Recordings along with other recordings. DSPs may group Recordings by genre or other designations may create and allow customers and others to listen to free preview clips of your Recordings. We are not responsible for what DSPs do, and by opting into a particular DSP, you agree to accept and have your Recordings made available to its customers following its pricing structure and other practices and policies from time to time, and under its agreement with Rapchat (or one of its representatives). DSPs calculate Sales Income in different manners, and they may change how they calculate Sales Income over time. Licensing fees, the deduction for author's rights, and other fees, as applicable, may be deducted prior to the paying out to Rapchat of Sales Income by DSPs. DSPs determine the retail prices for Recordings at their sole discretion and may change this pricing without us providing notice to you.
   3. Your Dashboard will indicate which types of Releases are currently available for your Account, which may vary by customer and change over time. We will try to provide your Recordings to the selected DSPs as quickly as possible. Please understand however that it can take anywhere between a few hours to several weeks for certain DSPs before they make your Recordings available to their clients, and that we do not have any control over the internal process and delays of a DSP.
   4. As part of the compensation paid by you to Rapchat, Rapchat provides (“ISRCs”) or Universal Product Codes (“UPCs”) for your Recording(s). These are for use only in connection with the Distribution Service provided by us and may not be transferred or resold. If you have previously obtained ISRCs or UPCs for your Release(s) from another source, you shall provide such previously-assigned ISRCs or UPCs when submitting your Recording(s) to us.
   5. In order to modify any metadata or any aspect of the Recording once it has been Digitally Distributed, you must take down the Release and resubmit it for Digital Distribution with the modifications. Rapchat shall not be responsible for any 'resetting' or other modifications to DSP 'play counts' as a result of the exercise of your right to modify Recording metadata under this Section 5.5.
   6. You acknowledge that in providing the Distribution Service and payments hereunder, we have entered into one or more agreements with respect to the DSPs (“DSP Agreements”), and you agree that these DTOS shall be subject to any applicable terms and conditions of the DSP Agreements, and to the extent of any conflict the terms of the DSP Agreements shall control. DSPs may also have policies related to fraud, suspected fraudulent activities, illegal activities, or infringement, and you agree that it is your responsibility to investigate such policies and that such policies shall be binding upon you hereunder.

6. 6. Distribution Service Fees And Payment:

   1. Rapchat uses a redeemable token system within its Distribution Service. For each Release, you are required to redeem a corresponding amount of Rapchat Tokens (as defined in Section 2) commensurate with the number of Recordings included in your requested Release, or in other amounts as may be determined by Rapchat in its sole discretion from time to time. In accordance with our policies set forth in the RTOS, users of the Service may purchase or otherwise acquire Rapchat Tokens, and once acquired, such acquired Rapchat Tokens shall not expire. Current fee schedules applicable to the purchase of Rapchat Tokens are available on the Site or in your Dashboard. These fees may be amended from time to time by us without notice to you.
   2. In limited instances, a Release you submit may be rejected or taken down (as the case may be) by Rapchat or one or more DSPs. A Release may be rejected for one or more reasons, including but not limited to, a third-party copyright claim, the failure to disclose explicit content, or poor audio quality. In such an event, Rapchat may, in its sole discretion, either (i) credit your Wallet a commensurate amount of Rapchat Tokens, (ii) upon the resolution of applicable issues causing such rejection or takedown, allow you to redistribute the Recording(s) for no additional Rapchat Token(s) redemption, or (iii) any other compensatory measure as determined by Rapchat; or refrain from any of the foregoing.
   3. In the event Rapchat offers, and you select, an annual distribution plan, your annual registration fee must be paid with a valid credit card and, as described below under “Term,” will automatically recur annually until you terminate the Term of this Agreement. Therefore, upon your selection of such an annual plan, you must maintain a valid credit card on account with us throughout the Term. We reserve the right to add or change payment methods during the Term. You expressly authorize Rapchat to charge the applicable amount, plus any applicable taxes, to the credit card you provided or, in our sole discretion, to deduct that amount from monies payable by us to you. Any refunds are in Rapchat's sole discretion. In addition, if you owe any fees or other amounts to Rapchat, we may deduct or set-off such amounts from any current or future payments to you, in addition to our other rights and remedies.

7. 7. Net Income:

   1. Rapchat will pay out an amount equal to one hundred percent (100%; the “Royalty Rate”) of Net Income we receive to the persons or entities, and in accordance with the percentage splits applicable to such Releases, as specified in your Dashboard. “Net Income” means Sales Income minus any refunds, taxes, tariffs, fees, royalties (other than covered mechanical royalties), or other charges related to the exploitation of your Releases, including currency conversion fees or payment processing fees incurred in the process to transfer you such money (such as PayPal). “Sales Income” means any and all monies we actually earn and receive in U.S. Dollars in the U.S.A. from your selected DSPs which are directly attributable to their exploitation of your Release(s). Net Income will be posted in U.S. Dollars to your Rapchat Credit Account in a timely fashion after our receipt thereof together with related sales and accounting data and such Net Income has accrued to the minimum royalty accrual necessary for withdrawal. To the extent that you owe any amounts to us as a consequence of the RTOS or otherwise, we shall have the right to deduct all or a portion of such amounts from any Net Income otherwise payable to you. Once the Net Income has been credited to your Rapchat Credit Account, you will be able to withdraw all or any portion thereof at your discretion. You will be responsible for any bank fees (including currency conversion fees) or other charges related to such withdrawals. If you owe us any amounts, we have the right to deduct all or a portion of such amounts from any Net Income otherwise payable to you. Rapchat shall not be liable for any payments that get disbursed incorrectly based on payment information being submitted incorrectly.
   2. Without limiting the RTOS, in the event that we have, in our good faith discretion, reason to suspect that your Account has been subjected to and/or involved in fraudulent or infringing activities: (i) we reserve the right to discontinue the posting of Net Income to your Rapchat Credit Account and block your ability to otherwise withdraw funds therefrom; (ii) Net Income will be forfeited by you; (iii) if in our reasonable business judgment we elect to engage an attorney in connection therewith, we shall, in our sole discretion, have the right to deduct from any monies otherwise payable to you hereunder or charge your Account an additional fee of a minimum of seven hundred dollars ($700 U.S.) to offset the costs of associated legal fees and expenses; and (iv) notwithstanding the foregoing, any other costs incurred by us (including total legal fees and expenses) in connection therewith may be deducted by us from any monies otherwise payable to you hereunder.
   3. As we receive sales information from the DSPs with respect to your Recording(s), we will make this information available to you through your Dashboard as soon as reasonably possible. This information comes from a DSP and we are not responsible for any errors or inaccuracies in the information.
   4. You understand and accept that we will pay no interest on any Net Income balance in your Rapchat Credit Account, even if we might receive interest or earnings on such balance. In addition, if you make your music jointly available with any person participating in the creation or performance of any musical work and/or lyrics included on your Recording and/or in the production or making of your Recordings (such as any composers, lyricists, musicians, singers, music producers, sound recording makers or others), you will be solely responsible for registering their splits in your Rapchat Dashboard, and otherwise will be making any payment to any such person as may be due in consideration for any such rights. Splits may be adjusted at any time; however, Rapchat shall not be liable for applying said adjusted splits retroactively.
   5. You acknowledge and agree that we and any of the DSPs shall have the right to market, promote, advertise, and distribute Recordings in connection with Digital Distribution promotional programs for which we or the DSPs receive no payment, and in connection with such promotions we and the DSP shall have no payment obligations to you.
   6. For certain Digital Distribution outside of the United States, DSPs customarily secure and pay for music publishing licenses (and such license fees may or may not be deducted by the DSP concerned from the proceeds payable to us). If a DSP does not make all necessary payments to secure the appropriate music publishing licenses, we may, but are not obligated to, make certain payments for the music publishing licenses required in connection with such DSP's Digital Distribution, and in connection therewith we shall have the right to deduct any payments we may make with respect to such licenses from any amounts payable to you hereunder.
   7. You acknowledge and agree that you will not use any automated means or method that is not authorized by any applicable DSP, including bots, botnets, robots, spiders, scrapers, data mining tools, automated scripts, or the like, to access your Recording(s) from the DSPs to generate plays, public performances, streams, or other uses of, or interactions with, your Recording(s) for the purpose of generating fraudulent Sale Proceeds or otherwise.

8. 8. Term:

   1. The term of this Agreement (the “Term”) will begin on the Effective Date and will continue for one (1) year, unless terminated earlier pursuant to Section 9 hereof.
   2. The Term will renew automatically at the end of each annual contract period (and if at the time of such renewal you have not provided proper notice of cancellation pursuant to Section 9 with regard to any previously elected paid annual plan offered by Rapchat, if any, your credit or debit card will be charged accordingly) unless you terminate your account prior the end of the then-current contract year via your account on the your Dashboard on the Site.

9. 9. Termination:

   1. You may terminate your use of the Distribution Service in accordance with the RTOS following our receipt of your written notice of termination, or by using the account cancellation feature in your Dashboard, and, subject to our rights in Section 9.3 below, we may notify all applicable DSPs to discontinue the distribution and sale of the applicable Recording(s). You will not be entitled to reimbursement of any pre-paid fees with respect to any terminated Recording(s).
   2. Upon our termination of your use of the Distribution Service in accordance with the RTOS, subject to our rights in Section 9.3 below, we may notify all DSPs to discontinue the distribution and sale of your Recording(s). You will not be entitled to reimbursement of any pre-paid fees with respect to any terminated Recording(s).
   3. In the event that the Digital Distribution of any Release is terminated for any reason and you still owe applicable Service Fees (including any applicable takedown fees): (i) we may elect to continue the distribution and sale of your Release(s); (ii) all rights granted to us hereunder and the DSPs will continue; (iii) we will be entitled to keep one hundred percent (100%) of Net Income due to you until the applicable Service Fee is fully recouped; and (iv) you will continue to be responsible for all of your obligations under these DTOS. Following our recoupment of the Service Fees due and owing to us, we will notify all applicable DSPs to discontinue the distribution and sale of the applicable Release(s) and these Distribution Terms will terminate. In the event that your Release has not been taken down as a result of your non-payment of Service Fees, and you would like to re-activate the Distribution Service, you may pay our then-current reinstatement fee, if any, and, upon our receipt of such fee, your Rapchat Credit Account will be reactivated and any Net Income thereafter due to you after our receipt of such payments will be paid to thereto. Reinstatement will not cause any payments retained by us to be paid to you. When you pay the reinstatement fee and re-subscribe to the Distribution Service, you will again be obligated to pay all applicable Service Fees.

YOU UNDERSTAND AND AGREE THAT WE AND THE DSP'S HAVE THE RIGHT, BUT NO OBLIGATION, TO MARKET, PROMOTE, AND ADVERTISE YOUR RELEASE(S). WE MAKE NO GUARANTEES WHATSOEVER WITH RESPECT TO THE SCOPE OF EACH DSP'S DISTRIBUTION OF YOUR RELEASE(S), MINIMUM SALES OF YOUR RECORDING(S), PAYMENTS TO YOU UNDER THESE DISTRIBUTION TERMS, THE MARKETING, PROMOTION, OR ADVERTISEMENT OF YOUR RECORDING(S) BY THE DSP'S, OR WHETHER A DSP WILL ACTUALLY OFFER YOUR RECORDING(S) FOR SALE. EACH DSP HAS TOTAL DISCRETION AS TO WHETHER IT WILL OFFER YOUR RECORDING(S) FOR SALE. WE AND THE RELATED PARTIES ARE NOT RESPONSIBLE OR LIABLE TO YOU IN ANY WAY AS A RESULT OF ANY INCORRECT OR INACCURATE INFORMATION IN CONNECTION WITH THE DISTRIBUTION SERVICE, INCLUDING, WITHOUT LIMITATION, INFORMATION PROVIDED BY YOU OR A DSP.