Member Agreement — Illustrated Sound

CHANNEL PROVIDER AGREEMENT

This Channel Provider Agreement (this "Agreement") is a binding contract between you, an online video channel provider ("Provider") and CD Baby, Inc. ("Company") governing your participation in Company’s multi-channel network (the "MCN"). BY CLICKING "I AGREE", YOU ACKNOWLEDGE THAT YOU HAVE READ, UNDERSTOOD, AND AGREE TO BE BOUND BY THIS AGREEMENT. IF YOU DO NOT WISH TO BE BOUND, THEN DO NOT CLICK "I AGREE."

  1. License. During the Term, Provider hereby grants to Company: (a) the right to include, within the MCN, all videos Provider has uploaded to YouTube ("Videos") and the YouTube channels created or controlled by Provider through which the Videos are displayed (the "Channels;" collectively, the Videos, Channels and all sound recordings, musical compositions, album cover artwork, photographs, identifying metadata, audio and audiovisual works contained therein are "Provider Content"); (b) the right to monetize, manage, and collect revenue from the use and exploitation of the Videos and Channels; (c) as between Provider and Company, the exclusive right to represent,  sell, and manage all advertising inventory (display, audio, and audiovisual) against the Provider Content, including, but not limited to, any ad sales, and the serving and monitoring of all ad campaigns; and (d) solely to grant the rights necessary to Google, Inc. to make such Provider Content available within the MCN on YouTube, the right and license to host, cache, route, index, transmit, store, copy, modify (to the extent necessary for Google to operate YouTube and other Google services), stream, perform, communicate to the public, display, reformat, excerpt, analyze, synchronize (in timed relation or otherwise), create algorithms and identification files based on, and otherwise exploit, reproduce, use and make available the audio-only and audiovisual works, sound recordings, and musical compositions owned or controlled (in whole or in part) by Provider and embodied within the Provider Content.  Company may sublicense the rights in Section 1(c) and 1(d) to a third party, including, but not limited to, YouTube and Google.  Additionally, the foregoing license includes the right for Company to feature Channels and Videos on a Company Hub Channel for promotional purposes ("Promotional Features").  A "Hub Channel" means any Channel under Company’s control.
  2. Financial Terms. Company will collect all revenue generated from the Channels directly (e.g., through Google AdSense, YouTube direct sales, or Company’s direct sales) (the "Revenue").
    1. Revenue Share. For each Channel, Company will pay Provider 80% of the Revenue (the "Revenue Share"). For the avoidance of doubt, Revenue excludes any payments made for views of Channels or Videos or clicks on advertisements connected with Videos ("Impressions") that YouTube determines are invalid, including (i) Impressions generated by any bot, automated program, or like device; (ii) Impressions originating from IP addresses or computers under Provider’s control; (iii) Impressions generated by individuals whom Provider has paid, requested, or otherwise induced, whether directly or through any third party, to make such Impressions; (iv) Impressions connected to advertisements for charities or other non-profit entities; or (v) Impressions connected to advertisements for the products or services of either party. Revenue will be determined solely by YouTube based on the number of Impressions that YouTube deems valid, and Provider acknowledges and agrees that Company will have no authority or ability to influence YouTube’s determinations of the validity of any Impressions.
    2. Payment. Company will use commercially reasonable efforts to pay Provider the Revenue Share within seven (7) business days from the date that Provider’s account with Company exceeds the Threshold Amount. The "Threshold Amount" means the dollar amount set by Provider initially upon Provider’s registration with the MCN, or as subsequently modified by Provider, which amount will in no event be less than $10. Company will remit payment via PayPal in United States Dollars and Provider will ensure that it maintains a valid PayPal account throughout the Term. Provider will provide Company will a tax identification number and any other information required by Company to pay Provider.
  3. Provider Obligations. Provider will (a) maintain, generate, and post Videos to the Channels; (b) manage the Channels (excluding management of advertising inventory); (c) promote the Channels and MCN through commercially reasonable channels, including through Provider’s social media accounts and other online properties owned or controlled by Providers; (d) comply with the YouTube Community Guidelines and any other Company policy or procedure; (e) upon request by Company or YouTube, notify YouTube of the Channel’s inclusion in the MCN and that all payments from YouTube for the commercialization of the Channels should be sent directly to Company, pursuant to YouTube’s policies regarding such notification; (f) include one of Company’s Hub Channels prominently in the "featured channels" section on Provider’s YouTube page, if applicable; and (g) notify Company of any sponsorships of any Channels, Provider Content, or Videos and any sponsorship or other relationship between an identifiable individual in any Provider Content and any third party, and any limitations or prohibitions, if any, arising out of such sponsorship or relationship. In order to join the MCN, Provider must create an Illustrated Sound Network account (the "Provider MCN Account"). Provider will be asked as part of the Provider MCN Account registration to select a unique user name and password and to provide Company with accurate, complete registration information to obtain access to the Company site. Provider will be solely responsible for any and all activity transacted and charges incurred under the Provider MCN Account, so please ensure that you keep you user name and password confidential and safe. If at any time Provider’s registration information changes or if you learn or suspect that your Provider MCN Account has been used or obtained by a person not authorized to use it, please notify Illustrated Sound Network immediately at support@illustratedsound.com.
  4. Content. Provider is solely responsible for, and retains full control over, all Channels and Videos. This includes, by way of example and not limitation, the cost for producing all Videos and obtaining any rights, licenses, clearances, or consents for the use of any person, product, trademark, or other intellectual property in any Videos or payments to any third party arising therefrom. Notwithstanding the foregoing, Company has the right to require Provider to remove from any Channel any Video that Company believes or suspects (a) violates any law, rule, policy, or regulation that Provider, the Channel or Video is subject to, including any policies established by YouTube, Google Inc., or other entities involved in hosting or monetizing the Channel and Videos; (b) infringes upon any third party’s intellectual property rights; or (c) will or does negatively impact Company’s reputation or business (collectively, "Objectionable Content"). Company will notify Provider of any Objectionable Content in writing and Provider will remove such Objectionable Content from the Channel within 3 days’ of receipt of such notice. Additionally, Company has the right to remove any Provider Content from the MCN in the event Provider breaches this Agreement or refuses to agree to any amended version of this Agreement, as set forth in Section 14.
  5. Intellectual Property.
    1. Ownership. The parties acknowledge and agree that any intellectual property rights, including any copyrights, trademarks, service marks, trade names, trade dress, patents or other intellectual property, that has been or will be provided by either party to the other party hereunder will remain the sole and exclusive property of the party providing such rights.
    2. Confirmation of Rights. Upon Company’s request, Provider will provide, within five (5) business days of receipt of such request, evidence of Provider’s ownership in or rights to all or any portion of the Provider Content, including any sound recordings, musical works, trademarks, or logos incorporated or displayed therein.
    3. Trademarks. Each party hereby grants the other party a non-exclusive, non-transferable, worldwide, royalty-free license, to use, publish, reproduce, broadcast, exhibit, and display the name, image, likeness, trademarks, trade names, and service names (collectively, "Marks") of the Providing Party in connection with the marketing and promotion of the MCN, the Channels, and the Videos. Any other use of the Providing Party’s Marks without the Providing Party’s consent is strictly prohibited.
    4. Notification of Copyright Infringement. Provider will notify Company immediately (email will suffice to support@illustratedsound.com) in the event any Video or Channel (i) is subject to a takedown notice issued under the U.S. Copyright Act (a "Takedown Notice") or (ii) is reasonably suspected to infringe upon a third party’s intellectual property right.
  6. Term; Termination. This Agreement will commence upon your acceptance of this Agreement by clicking "I Agree" below, and remain in effect until terminated as permitted herein (the "Term"). Either party may terminate this Agreement immediately upon breach by the other party of this Agreement, unless the breaching party remedies such default within 15 days of receipt of written notice of the non-breaching party’s intent to terminate this Agreement. Notwithstanding the foregoing, Company may terminate this Agreement immediately upon notice (a) if Company receives one or more Takedown Notices with respect to the Videos and/or Channels provided by Provider, (b) in the event of a breach by Provider of Section 4, or (c) if Provider does not agree to any amended version of this Agreement pursuant to Section 14. Provider may terminate this Agreement upon 30 days’ prior written notice (via email only) to Company.
  7. Effect of Termination. Upon termination of this Agreement, Company will take steps to return control of the Channels to Provider, including by providing YouTube with any required notifications. Sections 5.a, 7, 8, 9, 10, 11, 12, 13, and 14 will survive termination of this Agreement.
  8. Representations; Warranties. Each party represents, warrants, and covenants that it has authority to enter into this Agreement. Provider additionally represents and warrants that (a) it is the owner of all rights, including all rights in, by way of example and not limitation, any audiovisual works, sound recordings, and musical works, related to all content (including Videos) displayed on the Channel, including any Provider Content added to a Channel during the Term, (b) it has the right and power to license and/or sell the Provider Content, (c) neither the Provider Content nor use of the Channel infringes upon the rights of any third party, and (d) it has not granted any other party the right or authority to act on behalf of itself in any manner that would conflict with either party’s rights under this Agreement. EXCEPT FOR THE EXPRESS WARRANTIES STATED IN THIS AGREEMENT, THE PARTIES DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO: (i) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE; (ii) WARRANTIES AS TO THE QUALITY OR PERFORMANCE OF THE MATERIALS, INFORMATION, GOODS, SERVICES, TECHNOLOGY AND/OR CONTENT PROVIDED UNDER OR IN CONNECTION WITH THIS AGREEMENT, INCLUDING THE DELIVERY OR AVAILABILITY OF ANY ADVERTISEMENTS, AND ANY LIMITATIONS ON END USER ACCESS TO OR USE OF CHANNELS OR VIDEOS; AND (iii) WARRANTIES AS TO THE PERFORMANCE OF COMPUTERS, NETWORKS, OR ADS, INCLUDING, BUT NOT LIMITED TO, ALL WARRANTIES REGARDING THE PLACEMENT OF ADS. COMPANY MAKES NO WARRANTY THAT THE MCN AND ANY RELATED WEBSITE, INCLUDING YOUTUBE, WILL PERFORM WITHOUT INTERRUPTIONS OR ERRORS, OR THAT INFORMATION OBTAINED FROM THE MCN OR SUCH WEBSITES WILL BE ACCURATE OR RELIABLE. PROVIDER ACKNOWLEDGES THAT NONE OF COMPANY OR ANY OF ITS AFFILIATES WILL BE LIABLE TO PROVIDER FOR ANY CONTENT FEATURED ON CHANNELS IN THE MCN, INCLUDING ADVERTISING, OR THE DEFAMATORY, OFFENSIVE, OR ILLEGAL CONDUCT OF ANY THIRD PARTY.
  9. Limitation on Liability. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT WILL COMPANY OR ITS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, LICENSORS AND AGENTS (THE "COMPANY PARTIES") BE LIABLE FOR ANY SPECIAL, INCIDENTAL, INDIRECT, OR CONSEQUENTIAL DAMAGES WHATSOEVER (INCLUDING, BUT NOT LIMITED TO, DAMAGES FOR LOSS OF PROFITS OR FOR BUSINESS INTERRUPTION) ARISING OUT OF OR IN ANY WAY RELATED TO COMPANY’S PERFORMANCE HEREUNDER, THE PERFORMANCE OF THE MCN, OR THE CONTENT PROVIDED BY OTHER PERSONS OR ENTITIES TO COMPANY FOR DISTRIBUTION OR PROMOTION ON THE MCN, EVEN IF COMPANY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. COMPANY ASSUMES NO RESPONSIBILITY FOR DOWNTIME OF THE MCN OR FOR THE LOSS OF INFORMATION, DATA RECORDS, OR TITLES. IN NO WAY WILL COMPANY’S LIABILITY TO PROVIDER FOR ANY CLAIM ARISING UNDER THIS AGREEMENT EXCEED THE AMOUNTS PAID BY COMPANY TO PROVIDER UNDER THIS AGREEMENT IN THE 12 MONTHS PRECEDING THE EVENT GIVING RISE TO THE CLAIM. The foregoing limitations, exclusions, and disclaimers will apply to the maximum extent permitted by applicable law, even if any remedy fails its essential purpose.
  10. Covenant Not to Sue. Provider covenants and agrees, for itself, its representatives, and agents, not to bring, assert, pursue, maintain, join in or directly and/or indirectly support, assist, fund, lend resources to, or otherwise take part in any litigation, worldwide, against Company, Google, or YouTube.
  11. Indemnification. Provider will indemnify and hold the Company Parties harmless from and against any and all third party claims, liabilities, judgments, or penalties and all costs and expenses (including reasonable attorneys’ fees) incurred in connection with a breach by Provider of any of its representations or warranties in this Agreement. Company will indemnify and hold Provider and Provider’s directors, officers, employees, agents, licensors, subsidiaries, and affiliates harmless from and against any and all third party claims, liabilities, judgments, or penalties and all costs and expenses (including reasonable attorneys’ fees) incurred in connection with a breach by Company of any of its representations or warranties in this Agreement.
  12. Confidentiality. "Confidential Information" means any non-public information, traffic information, or other materials provided or disclosed by a party (the "Disclosing Party") to the other (the "Receiving Party") in connection with this Agreement, whether communicated in writing, electronically, by display, orally or by any other means. Confidential Information also includes the terms and conditions of this Agreement. Confidential Information does not include any information that: (a) was publicly known and made generally available in the public domain prior to the time of disclosure by the Disclosing Party; (b) becomes publicly known and made generally available after disclosure by the Disclosing Party to the Receiving Party through no action or inaction of the Receiving Party; (c) is already in the Receiving Party’s possession at the time of disclosure by the Disclosing Party, as confirmed by the Receiving Party’s records; (d) is obtained by the Receiving Party from a third party without a breach of the third party’s obligations of confidentiality; or (e) is independently developed by the Receiving Party without use of or reference to the Disclosing Party’s Confidential Information, as shown by evidence in the Receiving Party’s possession. Except with the Disclosing Party’s prior written consent or as otherwise permitted herein, a Receiving Party will not use the Disclosing Party’s Confidential Information in any manner nor will it disclose the same other than: (i) to such party’s attorneys, accountants and financial representatives under a duty of confidentiality as may be reasonably necessary in order to receive their professional advice; (ii) to such party’s employees and contractors who have a need to know and are obligated to maintain the confidentiality of such information; (iii) in connection with any legal, governmental or administrative proceeding, provided that prior written notice of such disclosure is furnished to the Disclosing Party in order to afford the Disclosing Party a reasonable opportunity to seek a protective order, to the extent not otherwise prohibited by law; (iv) to enforce this Agreement; or (v) as part of due diligence for any joint venture, acquisition, merger or other business combination with a third party where such third party has agreed to protect the Disclosing Party’s Confidential Information. Each party will use commercially reasonable efforts to protect the secrecy and avoid disclosure and unauthorized use of the other party’s Confidential Information, including at least those measures the party takes to protect its own confidential information of like importance.
  13. Dispute Resolution. All disputes between the parties arising out of or in connection with or the Agreement or any breach thereof will be determined and settled by binding arbitration, in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The arbitration will not be combined with any other proceeding or arbitration against one of the parties. The party initiating the arbitration will do so in the county where the other party is located. Each party will designate one arbitrator and the two designated arbitrators will select a third arbitrator to serve as the chair of the arbitration panel. If the two arbitrators cannot agree on the third arbitrator, then the AAA will appoint the third arbitrator. Barring extraordinary circumstances, the arbitrators will issue their decision within 120 days from the date the third arbitrator is selected. The arbitrators may extend this time limit for an additional 30 days in the interests of justice. All arbitration proceedings will be closed to the public and confidential and all records relating thereto will be permanently sealed, except as necessary to obtain court confirmation of the arbitration award. The arbitrators’ decision and award will be in writing and will include a statement setting forth the reasons for the disposition of any claim. A dissenting decision will also be set forth in writing. The award rendered by the arbitrators will be final and binding on the parties, and judgment thereon may be entered in any court of competent jurisdiction. The arbitration will be governed by and construed in accordance with Oregon law without reference to conflict of laws provisions.
  14. Miscellaneous. This Agreement is the entire understanding and agreement with respect to its subject matter, and supersedes any and all prior or contemporaneous representations, understandings, and agreements, whether oral or written, between the parties regarding same, all of which are merged in this Agreement. If any part of this Agreement is found to be unenforceable, then the remaining portions of this Agreement will remain in full force and effect. The parties acknowledge that this Agreement was fully negotiated by the parties and no provision of this Agreement will be interpreted against a party because such party or its legal representative drafted such provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the party to be charged, and the waiver of any breach or default will not constitute a waiver of any other right under this Agreement or any subsequent breach or default. Nothing in this Agreement creates, and the parties do not intend to create, any partnership or joint venture between the parties. Company may freely assign this Agreement, in whole or in part, in Company’s sole discretion. Provider may not assign this Agreement (including by way of change of control) without Company’s prior written consent, not to be unreasonably withheld, conditioned or delayed. This Agreement will bind and benefit the successors and permitted assigns of a party. The captions and headings in this Agreement are for convenience only and will in no event be construed to define, limit or describe the scope or intent of this Agreement or of any provision of this Agreement, nor in any way affect the interpretation of this Agreement. For claims not subject to Section 13, this Agreement will be governed by the laws of the State of Oregon, without reference to its conflict of law principles and jurisdiction of any and all such disputes will lie in the state and federal courts sitting in Multnomah County, Oregon, and Provider consents to personal jurisdiction in the state and federal courts located therein and hereby waives all defenses of lack of personal jurisdiction and forum non-conveniens. Company reserves the right to make immaterial revisions to this Agreement in its sole discretion at any time and without prior notice to Provider other than by posting a link to the revised Agreement in the Provider MCN Account. Company will endeavor to provide prior notice to Provider of any material changes to this Agreement. Unless otherwise stated, immaterial revisions to this Agreement are effective upon posting and material revisions are effective thirty (30) days after posting. Provider’s continued participation in the MCN after the effective date of a revised version of this Agreement constitutes Provider’s binding acceptance of such revised Agreement. Notwithstanding the preceding sentences of this Section, no revisions to this Agreement will apply to any dispute between Provider and Company that arose prior to the effective date of such revision. By entering into this Agreement, Provider consents to receiving certain electronic communications from Company. Provider agrees that any notices, agreements, disclosures, or other communications (collectively, "Notices") that Company sends to Provider electronically will satisfy any legal communication requirements, including that such communications be in writing. Any Notices required or permitted by this Agreement to be sent by Provider will be in writing and will be deemed to have been given at the earlier of the date: (a) three (3) days after being mailed by registered or certified U.S. mail, postage prepaid, return receipt requested; or (b) when received via electronic mail and confirmed by telephone or reply e-mail, in all cases addressed to Company at 13909 NE Airport Way, Portland, OR 97230 to the attention of General Counsel. Except as set forth in Sections 9 and 11, there are no third party beneficiaries to this Agreement.

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