INTERNET VIDEO LICENSE AGREEMENT

 
THIS AGREEMENT is made as of the 20th day of December, 1999 BETWEEN:
 
1. XYZ .......... GROUP INC. ("XYZ") of ……………………,
 
 AND 
 
 
 
 
 
 
 
 
 
2. YYY, INC. ("YYY") of ……………………………………………………………………..
 
BACKGROUND
 
A. WHEREAS, XYZ, in order to promote the sale and distribution of
 phonorecords and audio-visual music products throughout the "Territory"
 (as hereinafter defined in subparagraph 1.01(o)), licenses the use of
 "XYZ Videos" (as hereinafter defined in subparagraph 1.01(q)); and
 
B. WHEREAS, YYY intends to "Stream" (as hereinafter defined in
 subparagraph 1.01(l)) XYZ Videos from "Licensed Music Sites" (as
 hereinafter defined in subparagraph 1.01(e)).
 
C. NOW THEREFORE, the parties hereto have agreed to the terms and
 conditions set forth below with respect to the non-exclusive use by YYY
 of XYZ Videos on Licensed Music Sites.
 
THE PARTIES AGREE AS FOLLOWS:
 
1. DEFINITIONS AND INTERPRETATION
 
1.01 Definitions
 
 Unless defined elsewhere in this Agreement, capitalized terms shall
 have the meanings ascribed to them below:
 
(a) "ENDUSER DEVICE": any device (such as a computer or a Web TV) which is
 capable of receiving and playing/displaying the audio-visual output of
 a Streamed Video.
 
(b) "EXCERPT": means a continuous audio-visual portion of a XYZ Video
 where no more than 30 seconds thereof may be accessed by the enduser or
 viewed by a viewer.
 
(c) Intentionally deleted.
 
 
 
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(d) "INTERNET": the wide area cooperative network of university, corporate,
 government and private computer networks communicating through
 Transmission Control Protocol/Internet Protocol which is commonly
 referred to as the Internet.
 
(e) "LICENSED .......... SITE": any Music Site which: (i) (A) is either wholly-
 or partially-owned by YYY; and (B) is wholly-programmed and operated by
 YYY; and (C) is prominently and exclusively branded with the tradename,
 trademark or logo of YYY; or (ii) (A) is operated and managed by YYY
 and (B) is subject to a comprehensive written web site agreement
 between YYY and a recording artist (or such recording artist's
 furnishing company) ("Artist") of the type which YYY typically enters
 into with recording artists as of the date hereof; provided, that such
 Artist is a recording artist then-currently signed to an exclusive
 recording agreement with affiliates of XYZ, which such Music Site on
 a gratis basis (A) Streams Videos in a sequence designated by YYY on a
 continuous 24-hour, seven-day-a-week basis (i.e., as part of a
 "Pre-Programmed Stream") or (B) Streams particular Videos at the demand
 of an enduser (i.e., as part of an "On-Demand Stream"). Without
 limiting the foregoing, "Licensed Music Site" shall include all of
 those "pages" on a Music Site: (w) that constitute "home pages"; (x)
 that direct an enduser to a Video; (y) through which an enduser
 navigates in order to view a Video; or (z) from which an enduser can
 Stream a Video.
 
(f) "MASTER": a first generation color copy of the fully-edited titled and
 assembled electronic master of a XYZ Video (a "Videotape Copy") or,
 at XYZ's election, a copy of such electronic master digitized by
 XYZ in a format compatible with YYY's technical requirements (a
 "Digitized Copy").
 
(g) ".......... SITE": a non-subscription, music audio-visual programming
 service which may be advertiser-supported, which: (i) is delivered over
 the Internet (which may also include delivery via broadband
 technology); (ii) is transmitted from fileservers exclusively located
 in the United States using Streaming technologies; (iii) uses English
 as the principal language spoken by hosts or used in textual, graphic
 or interstitial programming; and (iv) if such service transmitted
 digital audio data only, rather than digital audio-visual data (other
 than with respect to On-Demand Streams) would be subject to statutory
 licensing pursuant to Paragraph 2, Subsection d, Section 114 of title
 17, United States Code (the "Digital Millennium Copyright Act").
 
(h) "ON-DEMAND STREAM FRACTION": a fraction, the numerator of which is that
 number of transmissions to an individual enduser of XYZ Videos (in
 whole or in part) other than Excerpts on a particular Licensed Music
 Site as part of an On-Demand Stream and the denominator of which is
 that number of transmissions to an individual enduser of Videos (in
 whole or in part), including XYZ Videos, on such particular Licensed
 Music Site as part of an On-Demand Stream, as determined in a calendar
 quarter.
 
 
 
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(i) "ON-DEMAND STREAM RECEIPTS": gross advertising monies (or the monetary
 value of any non-monetary advertising consideration) actually received,
 directly or indirectly, by YYY or YYY's affiliates in connection with
 the page of a Licensed Music Site that provides an On-Demand Stream of
 one or more XYZ Videos less any actual advertising agency or media
 sales fees directly related thereto.
 
(j) "PRE-PROGRAMMED STREAM FRACTION": a fraction, the numerator of which is
 that number of transmissions to an individual enduser of XYZ Videos
 (in whole or in part) other than Excerpts on a particular Licensed
 Music Site as part of a Pre-Programmed Stream and the denominator of
 which is that number of transmissions to an individual enduser of
 Videos (in whole or in part), including XYZ Videos, on such
 particular Licensed Music Site as part of a Pre-Programmed Stream, as
 determined in a calendar quarter.
 
(k) "PRE-PROGRAMMED STREAM RECEIPTS": gross advertising monies (or the
 monetary value of any non-monetary advertising consideration) actually
 received, directly or indirectly, by YYY or YYY's affiliates in
 connection with the page of a Licensed Music Site that provides a
 Pre-Programmed Stream of one or more XYZ Videos less any actual
 advertising agency or media sales fees directly related thereto.
 
(l) "STREAM(s)(ed)(ing)": a public performance of any duration via the
 Internet that permits an enduser to view data contemporaneously with
 its reception by an Enduser Device in such a manner that the data is
 not copied, duplicated or stored in such Enduser Device except by way
 of temporary buffering.
 
(m) "TERM": shall commence on the date of this Agreement and end on
 December 31, 2001, unless sooner terminated as set forth herein.
 
(n) "TERM YEAR": each separate, consecutive 12-month period of the Term.
 
(o) "TERRITORY": worldwide.
 
(p) "VIDEO": an audio-visual work embodying the sound recording of a single
 musical composition in synchronization with visual images intended
 primarily for promotional use.
 
(q) "XYZ VIDEO": any Video with respect to which XYZ has promotional
  exhibition rights in the Territory (a "Controlled Video") that XYZ
 or any of XYZ's wholly-owned US-based record company affiliates (the
 "Affiliates") wish to license to unaffiliated third parties for
 broadcast television exhibition or to unaffiliated third party Music
 Sites for Streaming, provided that the soundtrack of such Video is a
 duplicate of a sound recording owned or controlled for the Territory by
 XYZ. Within sixty (60) days following the date of this Agreement,
 XYZ shall provide YYY with a list of current Affiliates. "XYZ
 Videos" shall not include: (i) any Videos commercially exhibited prior
 to the commencement of the Term; or (ii) any Video which is part of a
 long-form audio-visual program and is not distributed or licensed by
 XYZ separately therefrom. XYZ shall have the right to elect in
 XYZ's sole discretion that Controlled Videos from up to [***]*
 albums released in any Term Year not become XYZ Videos for the
 purposes of this Agreement until 90 days following the date which is
 the earlier of: (A) the date on which the Video is initially Streamed
 under XYZ's authority by an unaffiliated third party; or (B) the
 date on which the Video is initially exhibited under XYZ's authority
 on television in the US.
 
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* Confidential treatment has been requested for the bracketed portion. The
confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.
 
 
 
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1.02 Headings
 
 The headings used in this Agreement are for ease of reference only and
 shall have no effect on the interpretation or construction of this
 Agreement.
 
1.03 Plural/Singular/References
 
 The plural may include the singular and the singular may include the
 plural and this Agreement shall be interpreted in this regard as the
 context may require. References to paragraphs and subparagraphs are to
 paragraphs and subparagraphs of this Agreement, and references to any
 agreement or other instrument shall be deemed to include references to
 that agreement or other instrument as varied or replaced from time to
 time.
 
2. GRANT OF RIGHTS
 
2.01 Duplication Rights
 
 During the Term, subject to the terms and conditions of this Agreement,
 XYZ grants to YYY a non-exclusive license to digitally encode and
 duplicate XYZ Videos in their entirety for duplication on YYY's
 fileservers for the sole purpose of producing programming containing
  XYZ Videos for Streaming on Licensed Music Sites.
 
2.02 Streaming Right
 
 Subject to the terms and conditions of this Agreement and any
 contractual restrictions imposed upon XYZ in connection with XYZ
 Videos of which XYZ has advised YYY in writing with reasonable
 advance notice, during the Term XYZ grants to YYY a non-exclusive
 license: (a) to permit endusers to access via Streaming XYZ Videos
 in their entirety as part of a Pre-Programmed Stream on a Licensed
 Music Site; and (b) to permit endusers to access via Streaming XYZ
 Videos in their entirety as part of an On-Demand Stream on a Licensed
 Music Site; provided, however, that endusers shall not be able to
 Stream more than one XYZ Video at a time as part of a continuous
 transmission (i.e., endusers shall not be able to Stream a series of
 XYZ Videos as part of one continuous transmission). Continuously
 during the Streaming of any XYZ Video as part of an On-Demand Stream
 and in a space that is "above the fold," near or adjacent to, and on
 the same page as such XYZ Video, YYY shall, at YYY's sole cost and
 expense, provide a button permitting an enduser "one-click" access to
 the "home page" for the applicable Affiliates' official site of the
 applicable artist (or, if the artist does not have an official site,
 the "home page" for the official site of the applicable Affiliate that
 is the artist's record company), provided that XYZ delivers to YYY,
 prior to or no later than XYZ's delivery of the applicable XYZ
 Video, the foregoing "home
 
 
 
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 page" information. If other links are provided to third-party sites for
 the same artist, then the Affiliate's link shall be the first listed
 and the most prominent.
 
2.03 Advertising and Promotion
 
 Subject to the terms and conditions of this Agreement and any
 contractual restrictions imposed upon XYZ in connection with XYZ
 Videos of which XYZ has advised YYY in writing, during the Term, YYY
 may utilize Excerpts in any and all media to advertise, promote and
 publicize the exhibition of XYZ Videos on the Licensed Music Sites;
 provided, however, that, without XYZ's written consent, no more than
 one Excerpt per artist may be used for such purpose.
 
2.04 Names and Likenesses
 
 Subject to the terms and conditions of this Agreement and any
 contractual restrictions imposed upon XYZ in connection with XYZ
 Videos of which XYZ has advised YYY in writing with reasonable
 advance notice, during the Term, YYY may use the name and
 XYZ-approved or -supplied likenesses, such approval not to be
 unreasonably withheld or delayed, of such artist for the purposes of
 advertising, promoting or publicizing the Streaming by YYY of such
 XYZ Video on the applicable Licensed Music Site, but not in a manner
 which implies an endorsement of any service (including, without
 limitation, Licensed Music Sites) or product without XYZ's prior
 consent.
 
2.05 Reservation of Rights
 
(a) As between XYZ and YYY, XYZ retains all ownership rights in
 Masters and XYZ Videos including, without limitation, all copyrights
 and trademarks in Masters and XYZ Videos; provided, however, that
 neither XYZ nor the Affiliates shall use in any manner any Digitized
 Copy of a XYZ Video created by or at the direction of YYY, unless
 XYZ or an Affiliate has made payment therefor in accordance with
 paragraph 4.01.
 
(b) YYY shall not have any rights in XYZ Videos other than as expressly
 provided in this Agreement.
 
2.06 Withdrawal Rights
 
 YYY agrees that YYY's rights to Stream any XYZ Video may be
 terminated by XYZ upon one week's prior written notice to YYY if any
 of the following conditions are met:
 
(a) If the respective Affiliate, in the respective Affiliate's good faith
 business judgment believes that such termination is necessary for
 significant artist relations purposes; or
 
 
 
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(b) If the respective Affiliate's rights in the XYZ Video terminate; or
 
(c) If the respective Affiliate is notified or otherwise becomes aware of
 an apparently bona fide third-party claim that the transmission of the
 XYZ Video infringes rights owned by others.
 
3. PROHIBITIONS ON YYY
 
 YYY shall only have the right to exploit or use XYZ Videos as
 specifically authorized in Paragraph 2 of this Agreement, or as
 otherwise agreed to by XYZ in writing in its sole discretion, and
 may not exploit or use XYZ Videos in any other manner. Without
 limiting the foregoing, unless XYZ agrees otherwise in writing,
 during the Term, neither YYY nor any party acting on behalf of YYY
 shall, directly or indirectly:
 
(a) copy or duplicate any XYZ Video except as YYY may reasonably require
 to exercise YYY's rights under this Agreement;
 
(b) Stream (or encode to permit the Streaming of) the audio portion of any
 XYZ Video at a transmission rate greater than [***]* or the video
  portion of any XYZ Video at a transmission rate greater than [***]*;
 
(c) Stream the soundtrack of any XYZ Video separately from the visual
 portion thereof;
 
(d) Stream the visual portion of any XYZ Video separately from the
  soundtrack thereof, except to the extent that YYY uses only the visual
 portion of an Excerpt to exercise YYY's rights under subparagraph 2.03
 above without any soundtrack whatsoever;
 
(e) Stream any XYZ Video other than in conjunction with the sequence of
 images originally synchronized with the sound recording included
 thereon;
 
(f) Stream any XYZ Video on a "pay-per-view" or "pay-per-play" basis;
 
(g) exhibit any advertisement or commercial of any nature during or
 associated with the Streaming of any XYZ Video in a manner which
 reasonably implies an endorsement by the artist whose performances are
 contained on such XYZ Video;
 
(h)  license or authorize a third party (whether or not affiliated with YYY)
 to "deep link" to a non-Licensed Music Site for the purpose of
 Streaming a XYZ Video; or
 
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* Confidential treatment has been requested for the bracketed portion. The
confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.
 
 
 
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(i) except as expressly set forth in Paragraph 5, edit or otherwise alter
 any XYZ Video, including, without limitation, the deletion or
 erasing of any signal now or hereafter contained therein to facilitate
 the automatic identification and/or logging of XYZ Videos so
 Streamed and/or to restrict the reproduction of XYZ Videos so
 Streamed (a "Protective Signal").
 
 Should YYY become aware that any party (whether or not acting on behalf
 of YYY) is circumventing the provisions of this Paragraph 3 (a
 "Circumvention Event"), YYY shall promptly notify XYZ in writing
 thereof and YYY shall, at YYY's sole cost and expense, use YYY's
 commercially reasonable efforts to prevent such circumvention.
 
4. XYZ VIDEOS
 
4.01 Servicing of Masters
 
 In respect of each XYZ Video, XYZ shall make a Master available
 to YYY for collection at YYY's expense, no later than the date XYZ
 or an Affiliate makes the applicable XYZ Video available for
 delivery to other unaffiliated third parties. Should XYZ provide YYY
 with a Master in Videotape Copy form, YYY shall provide XYZ, at
 XYZ's request, with a Digitized Copy of such Master provided that
 XYZ pays YYY's actual duplication and shipping expenses in
 connection therewith.
 
4.02 Treatment of XYZ Videos and Masters
 
 YYY shall:
 
(a) maintain all Masters and all copies of Masters on YYY's premises and
 safeguard the same from any loss, damage, theft, unauthorized use,
 copying, storage or duplication by others;
 
(b) be solely responsible for any loss, theft or damage to Masters and
 copies of Masters in their possession and any unauthorized use,
 copying, storage or duplication by others thereof; and
 
(c) upon the expiration of the Term or termination of this Agreement, at
 XYZ's election, YYY shall either: (i) (A) to the extent that XYZ
 made Digitized Copies of any Masters and provided them to YYY
 hereunder, return all such Masters and copies of such Masters to XYZ
 at YYY's expense; (B) to the extent that YYY made Digitized Copies of
 any Masters hereunder, but has not provided Digitized Copies of such
 Masters to XYZ pursuant to subparagraph 4.01 above, return all such
 Masters and copies of such Masters to XYZ and XYZ shall pay YYY's
 actual duplication and shipping expenses; and (C) to the extent that
 YYY made Digitized Copies of any Masters hereunder and has provided
 Digitized Copies of such Masters to XYZ pursuant to subparagraph
 4.01 above, return all such Masters and copies of such Masters to
 XYZ at
 
 
 
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 YYY's expense; or (ii) or destroy all Masters and all copies of Masters
 at YYY's sole cost and expense, and provide XYZ with a written
 affidavit verifying such destruction.
 
5. YYY'S UNDERTAKINGS
 
 During the Term, YYY shall have the obligation, at YYY's sole cost and
 expense:
 
(a) to exhibit the following information continuously during the Streaming
 of each XYZ Video in a space adjacent to the XYZ Video, provided
 that XYZ submits such information to YYY in a timely manner:
 
 (i) the title of the musical composition on the XYZ Video;
 
 (ii) the title of the record or home video that includes the
  performance of the musical composition contained in the XYZ
 Video;
 
 (iii) the name of the artist performing the musical composition
 contained in the XYZ Video;
 
 (iv) the name of the record company and the URL of its "home page";
 and
 
 (v) the name of the motion picture, if any, from which the XYZ
 Video is derived.
 
(b) to obtain public performance rights licenses, if necessary, covering
 the performance of the musical compositions in XYZ Videos; and
 
(c) to transmit as part of each XYZ Video Streamed on Licensed Music
 Sites any Protective Signal contained in the XYZ Videos; provided,
 however, that the transmission of such Protective Signal does not
 represent a recurrent and unreasonable cost to YYY and in no way leads
 to the deterioration of Streaming quality of XYZ Videos.
 
6. XYZ'S UNDERTAKINGS
 
 XYZ shall deliver to YYY, at XYZ's expense (where available and
 reasonably contemporaneously with the delivery of the relevant Masters)
 artwork, promotional material, biographical material and other
 information in relation to XYZ Videos and the relevant artists, to
 be used by YYY solely for promotional purposes on Licensed Music Sites.
 
7. COMPENSATION
 
 
 
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7.01 Royalties
 
 YYY shall pay to XYZ royalties equal to: [***]*.
 
7.02 Banner Ads
 
 
 YYY shall make "Banner Ads" (the "Banner Ads") available to XYZ at
 YYY's standard rate card cost therefor, or at such other rate as the
 parties shall mutually agree.
 
 
8. ACCOUNTING AND PAYMENTS; MARKET RESEARCH
 
8.01 Accounting
 
 Within 30 days following each calendar quarter of the Term, YYY shall
 account for and pay to XYZ any royalties payable in respect of such
 quarter and shall furnish to XYZ a statement setting forth:
 
(a)  a listing of all XYZ Videos Streamed on each Licensed Music Site
 during such quarter;
 
(b) the number of XYZ Videos Streamed on each Licensed Music Site as
 compared to the total number of Videos Streamed on each such Licensed
  Music Site during such quarter;
 
(c) Pre-Programmed Stream Receipts and On-Demand Stream Receipts for such
 quarter and the sources thereof;
 
(d) the number of times that XYZ Videos were Streamed on each Licensed
 Music Site as compared to the total number of times that Videos were
 Streamed on each such Licensed Music Site during such quarter;
 
(e) the number of "pageviews" of the Banner Ads during such quarter and the
 number of "clickthroughs" from the Banner Ads to URLs designated by
 XYZ during such quarter.
 
 YYY shall also furnish XYZ with the information described in
 subparagraphs 8.01(a), (b) and (d) on a weekly basis within 10 days
 following the end of each week during the Term.
 
8.02 Audit Rights
 
(a) YYY shall keep complete and accurate books and records of account
 relating to the Streaming of XYZ Videos and Videos maintained to a
 standard sufficient to enable an audit trail to be established.
 
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* Confidential treatment has been requested for the bracketed portion. The
confidential redacted portion has been omitted and filed separately with the
Securities and Exchange Commission.
 
 
 
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(b) XYZ shall have the right during the Term and during the two-year
 period following the termination or expiration of the Term, at XYZ's
 sole cost and expense, to have a certified public accountant inspect
 YYY's books and records no more than once during any year. This
 inspection shall take place at YYY's office, during normal business
 hours on not less than 30 days' written notice. The auditor appointed
 by XYZ may inspect and take copies of the books and records of YYY
 solely for the purpose of verifying the calculation of royalties
 accruing to XYZ under this Agreement and verifying YYY's compliance
 with Paragraph 7.
 
(c) Each statement rendered under this Agreement shall be deemed final and
 binding upon XYZ as an account stated and shall not be subject to
 any claim or objection by XYZ unless XYZ notifies YYY of XYZ's
 objection to the applicable statement, stating the basis thereof in
 reasonable detail within three (3) years after the date such statement
 was rendered to XYZ hereunder.
 
8.03 Market Research
 
 YYY and XYZ shall cooperate with each other in conducting market
 research, at XYZ's sole cost and expense, designed to determine the
 effect of the Licensed Music Sites on consumer awareness of artists
 featured in XYZ Videos and sales of such artist's records. YYY and
 XYZ shall use the results of such research for internal purposes
 only. Such market research shall be subject to the approval of any
 applicable artists (but only if required by written agreement between
 YYY and such artist) and shall be subject to the published privacy
 policy of the applicable Licensed Music Site (if any).
 
9. WARRANTIES AND INDEMNITY
 
9.01 YYY's Warranties
 
 YYY represents and warrants that:
 
(a) YYY has full right and authority to enter into and to fulfill all of
 YYY's obligations under this Agreement; and
 
(b) YYY shall comply with all licenses, laws and regulations relating to
 its maintenance and transmission of Licensed Music Sites.
 
9.02 XYZ's Warranties
 
(a) XYZ represents and warrants that XYZ has the right to enter into
 and fulfill all of XYZ's obligations under this Agreement; and
 
(b) XYZ makes no representation or warranty whatsoever with respect to
 the non-dramatic performing rights in the musical compositions embodied
 in the XYZ Videos.
 
 
 
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9.03 Indemnity
 
(a) YYY does hereby indemnify, save and hold harmless XYZ and XYZ's
 subsidiaries, affiliates, licensees, assigns, officers and employees
 from any and all loss and damage (including, without limitation,
 reasonable fees and disbursements of counsel incurred by XYZ in any
 action or proceeding between YYY and XYZ or between XYZ and any
 third party or otherwise) arising out of or connected with any claim or
 act or omission by YYY which is inconsistent with any of the
 representations or agreements made by YYY in this Agreement or any
 breach of YYY's obligations hereunder or any unauthorized use by YYY or
 any party acting on behalf of YYY of Masters or XYZ Videos in
 connection with the advertising, promotion or publicity of each XYZ
 Video or the name or likeness of any artist who rendered services in
 connection with such XYZ Videos. XYZ shall have the right at all
 times, in XYZ's sole discretion and at XYZ's sole cost and
 expense, to retain or resume control of the conduct relative to the
 defense of any claim to which the foregoing indemnity applies. The
 foregoing indemnity shall be limited to claims reduced to judgment or
 settled with YYY's prior written consent not to be unreasonably
 withheld.
 
(b) XYZ does hereby indemnify, save and hold harmless YYY and YYY's
 subsidiaries, affiliates, licensees, assigns, officers and employees
  from any and all loss and damage (including, without limitation,
 reasonable fees and disbursements of counsel incurred by YYY in any
 action or proceeding between YYY and XYZ or between YYY and any
 third party or otherwise) arising out of our connected with any claim
 or act or omission by XYZ which is inconsistent with any of the
 representations or agreements made by XYZ in this Agreement or any
 breach of its obligations hereunder or any claim that any XYZ Video
 or the content thereof violates the rights of any third party,
 including, without limitation, libel, slander, defamation, copyright,
 trademark, and rights of privacy and publicity. YYY shall have the
 right at all times, in YYY's sole discretion and at YYY's sole cost and
 expense, to retain or resume control of the conduct relative to the
 defense of any claim to which the foregoing indemnity applies. The
 foregoing indemnity shall be limited to claims reduced to judgment or
 settled with XYZ's prior written consent not to be unreasonably
 withheld.
 
(c) The indemnitor shall give the indemnitee prompt written notice of any
 claim to which the foregoing indemnity applies, and the indemnitor
 shall have the right to participate in the defense of any such claim
 through counsel of the indemnitor's own choice and at the indemnitor's
 cost and expense.
 
10. TERMINATION
 
10.01 XYZ's Termination Rights
 
 
 
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<PAGE> 12
 
 XYZ may terminate this Agreement immediately by written notice to
 YYY if, at any time during the Term:
 
(a) YYY goes in liquidation, receivership or administration or becomes
 bankrupt, makes any arrangement for the benefit of YYY's creditors or
 has a receiver appointed for any of YYY's assets; provided, that if
 such proceeding is involuntary, then XYZ shall not have the right to
 terminate the Term unless such proceeding is not dismissed within 90
 days of the filing thereof;
 
(b) YYY breaches any material term or provision of this Agreement;
 
(c) the Licensed Music Sites cease, except for any instance of force
 majeure, to be transmitted for a continuous period of 10 days; or
 
(d) if YYY does not succeed in preventing a Circumvention Event within 60
 days following YYY's becoming aware thereof;
 
 provided, in the case of any event set forth in subparagraph (b) above,
 XYZ shall have given YYY written notice of such event and YYY shall
 have failed to cure same within 30 days after YYY's receipt of such
 notice (or 10 business days if the event is YYY's failure to pay XYZ
 a sum certain).
 
10.02 YYY's Termination Rights
 
 YYY may terminate this Agreement immediately by written notice to
 XYZ if: (a) at any time during the Term, XYZ goes into
 liquidation, receivership or administration or becomes bankrupt, makes
 any arrangement for the benefit of XYZ's creditors or has a receiver
 appointed for any of XYZ's assets; provided, that if such proceeding
 is involuntary, then YYY shall not have the right to terminate the Term
 unless such proceeding is not dismissed within 90 days of the filing
 thereof; or (b) if XYZ or an Affiliate breaches any material term or
 provision of this Agreement and fails to cure such breach within 30
 days after YYY's written notice to XYZ of such breach.
 
11. PROCEDURE UPON TERMINATION
 
 Upon the expiration or termination of this Agreement:
 
(a) YYY shall cease the Streaming of XYZ Videos on Licensed Music Sites;
 
(b) YYY shall perform in accordance with the provisions of subparagraph
 4.02(c); and
 
(c) should YYY terminate this Agreement pursuant to subparagraph 10.02
 above, YYY shall have no further obligations to XYZ and XYZ shall
 have no further obligations to YYY.
 
 
 
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12. MISCELLANEOUS
 
12.01 Relationship of the Parties
 
 In performing its obligations under this Agreement, each of the parties
 hereto shall be deemed an independent contractor, and nothing in this
 Agreement shall in any way constitute either party, or any of such
 party's officer or directors, an agent or employee of the other party
 and this Agreement shall not be deemed to constitute a partnership,
 joint venture or contract of employment between the parties.
 
12.02 Service of Notices
 
 Any notice which either party hereto may desire to give or which is
 required under the terms of this Agreement shall be given in writing by
 registered or certified mail, return receipt requested, or by telefax
 or by personal service (in all cases, all charges prepaid) to YYY at
 the address first noted in the preamble to this Agreement, Attn: Chief
 Financial Officer, or to such other address to which YYY notifies
 XYZ in writing, with copies to Lenard & Gonzalez, LLP, 1900 Avenue
 of the Stars, 25th Floor, Los Angles, California 90067, Attn: Allen D.
 Lenard, Esq., and to XYZ to the address first noted in the preamble
 to this Agreement, Attn: General Counsel. In the event any such notice
 is given by mail, such notice shall be deemed to be given on the date
 five business days following the date of such mailing. In the event any
 such notice is given by personal delivery, such notice shall be deemed
 to be given on the date personal delivery is made.
 
12.03 Confidentiality/Press Announcements
 
 Neither YYY nor XYZ nor their respective affiliates may disclose to
 any third party (other than each party's employees and professional
  advisors, in their capacity as such) any information regarding the
 terms and conditions of this Agreement without the prior written
 consent of the other party except:
 
(a) to the extent necessary to comply with the law or the legal process of
 a court of competent jurisdiction or in administrative proceedings, in
 which event the party making such disclosure must use its commercially
 reasonable efforts to procure confidential treatment of such
 information;
 
(b) as part of its normal reporting or review procedure to its parent
 companies, its auditors and its attorneys, provided that YYY and XYZ
 inform these parties of the provisions of this subparagraph 12.03;
 
(c) to the extent necessary to comply with XYZ's contractual obligations
 to third parties;
 
(d) to make press announcements approved in writing by both of the parties;
 and
 
 
 
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<PAGE> 14
 
(e)  to the extent such terms become public through no breach by either
 party of this subparagraph 12.03.
 
 In addition to the foregoing, YYY shall not disclose to any third party
 (other than to YYY's employees, in their capacity as such): (i) the
 identity of the XYZ Videos Streamed on a Licensed Music Site; (ii)
 the number of XYZ Videos Streamed on a Licensed Music Site; or (iii)
 the number of times that any XYZ Video was Streamed on a Licensed
 Music Site.
 
12.04 Assignment/Sublicense
 
 XYZ may not assign, sublicense or effectively assign or sublicense
 XYZ's rights or obligations under this Agreement except to an
 affiliated or associated company or to a person or entity acquiring all
 or substantially all of the stock or assets of XYZ and subject to
 the assignee assuming XYZ's obligations hereunder. YYY may not
 assign, sublicense or effectively assign or sublicense any of YYY's
 rights or obligations under this Agreement to any party. For the
 avoidance of doubt, YYY may not syndicate YYY's programming containing
 XYZ Videos.
 
12.05 No Waiver
 
 No failure to exercise or delay in exercising any right, power or
 privilege under this Agreement by either party shall operate as a
 waiver of that right, power or privilege. Similarly, a single or
 partial exercise of any right, power or privilege by either party shall
 not preclude any other or further exercise of that right, power or
 privilege.
 
12.06 Remedies Cumulative/Severability
 
 The rights and remedies contained in this Agreement are cumulative and
 are not exclusive of any rights and remedies provided by law, in equity
 or otherwise. If any provision of this Agreement is prohibited by or
 contravenes any applicable law, or is held by any court of competent
 jurisdiction or any other legally constituted body having jurisdiction
 to make this determination to be void, unlawful or unenforceable then
 that provision shall be severed from the Agreement and rendered
 ineffective, as far as possible, without modifying the remaining
 provisions of this Agreement.
 
12.07 Entire Agreement/Amendments/Counterparts
 
 This Agreement contains the entire agreement between the parties with
 respect to its subject matter and supersedes any prior agreement or
 negotiation between the parties on the subject matter of this
 Agreement. There are no representations, agreements or understandings,
 oral or written, between the parties relating to the subject matter of
 this Agreement which are not fully
 
 
 
 14
<PAGE> 15
 
 expressed in this Agreement. No amendment, termination, waiver,
 discharge or modification of this Agreement shall be effective unless
 it is in writing and is signed by an authorized signatory of both
 XYZ and YYY. This Agreement may be executed in one or more
 counterparts and by facsimile signature, each of which shall be deemed
 an original and all of which together shall be deemed one Agreement.
 
12.08 Litigation
 
 YYY shall notify XYZ if YYY becomes aware of any unauthorized
 dealing by any third party in any XYZ Videos or in Licensed Music
 Sites, and shall cooperate fully, at XYZ's cost, in any dispute
 relating to XYZ's rights in Masters and XYZ Videos as well as
 XYZ's rights under this Agreement. XYZ, after written notice to
 YYY, may, at XYZ's sole cost and expense, act in the name of YYY and
 XYZ to protect XYZ's rights under this Agreement and YYY appoints
 XYZ YYY's attorney-in-fact to do this; provided, however, that
 XYZ shall not be permitted to execute any document on behalf of YYY
 without first affording YYY a reasonable opportunity to execute such
 document itself. If XYZ acts on YYY's behalf as permitted herein,
 XYZ shall keep YYY informed on a current basis of such acts and all
 proceedings relating thereto.
 
12.09 Governing Law
 
  This agreement has been entered into in the state of New York, and the
 validity, interpretation and the laws of the state of New York shall
 govern the legal effect of this Agreement. The New York courts (state
 and federal), only, shall have jurisdiction of any controversies
 regarding this Agreement; any action or other proceeding which involves
 such a controversy shall be brought in these courts, in New York
 County, and not elsewhere. Any process in any such action or proceeding
 may, among other methods, be served upon YYY or XYZ, as applicable,
 by delivering it or mailing it, by registered or certified mail, return
 receipt requested, directed to the address first above written. Any
 such delivery or mail service shall be deemed to have the same force
 and effect as personal service within the state of New York.
 
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first above written.
 
ACCEPTED AND AGREED:
 
XYZ .......... GROUP INC. YYY, INC.
 
 
By: /s/ …………………………………… By: /s/ …………………………….
 ------------------------------ ---------------------------
Name:  Name: 
Title: Executive Vice President Title: CEO