A music distribution contract is an agreement whereby a party (normally a record label or unsigned artist) grants a license to a company to distribute a catalog of songs. The main contract sections are term, exclusivity, number of songs, formats, and territory, and they are all fully customizable to reflect each scenario.
Royalties are calculated on an either “Net Receipts” basis or as a percentage of each record sale. Accounting is set out quarterly, and the party licensing the catalog warrants that they have paid and will continue to pay all relevant mechanical licenses, guest performers’ and producer’s fees.
This contract is used by companies distributing artists or label’s catalogs of music to retailers, service providers, aggregators, and/or directly to users or to sub-license distribution rights to third parties.
Read our related blog here.