Exhibit 7

f

-

EXCLUSIVE RTCORDING AGREEMENT

THIS AGREEMENT made as of the 11th day of October, 1984
between JAMES AVERY, TONY FISHER, ROBERT REED and TAYLOR
REED, as members of the musical group "Trouble Funk,"
E.
Tisdale,
Esquire,
c/a
Raphael
Hudson
&
Leftwieb
Davenport, Suite 806, 1101 - 15th Street, N.W,, Suite 806,
Washington, D.C. 20005 (hereinafter "you"), and T.T.E.D
RECORDS, INC., a District of Columbia corporation, 3180
Bladensburg Road, N.E., Washington, D.C. 20018, (hereinafter
"Company" and sometimes "us," "our" or "we").
1.

TERM, SERVICES, RECORDING COMMITMENT, RIGHTS

1.01
During the tern of this agreement, you will
furnish the exclusive services of JANES AVERY, TONY FISHER,
ROBERT REED and TAYLOR REED, in their capacities as members
of the musical group professionally known as "Trouble Funk"
(hereinafter referred to as "Artist") to perform for the
as
provided in
purpose of making Phonograph Records
paragraph 1.03.
1.02

(a)

This agreement shall coimnence as of the

above date and shall continue in force for a term which
shall consist of an initial period and the additional period

or periods, if any, for which such term may be extended
through Company's exercise of one or more of the options
granted to Company below. The initial Contract Period shall
end on the date nine (9) months after the Delivery of the
Master Recordings required to be Delivered in fulfillment of
your Recording Commitment (as specified in paragraphs 1.03
and 1.04) for the initial Contract Period (unless extended
or suspended as provided herein).
You grant Company two (2)
separate,
(b)
consecutive options to extend the term of this agreement for
additional periods (the "Option Periods"), upon all the
terms..
conditicns herein contained,, each of which shaU.
end on the date nine (9) months after the Delivery of the
Master Recordings required to be Delivered in fulfilment of
your Recording Commitment and Overcall Recordings, if any,
(as specified in paragraphs 1.03 and 1.04) for the Contract
Period concerned (unless suspended or extended as provided
herein.
Each option shall be exercised by Company giving

you written notice at least thirty (30) days prior to the
expiration of the then current term of this agreement as the
same may have been suspended, or extendéd, as provided
herein.
Island Records Inc. (hereinafter "Islan&) and

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Compnay have entered into a record production contract of
even date (hereinafter the "Island Contract"), which, among
other
thincrs,
provides for the production of Masters
featuring Artist. Notwithstanding anything to the contrary
contained in this agreement, if the Island Contract is
terminated or expires ïn respect of the recording services
of
shall
the
term
agreement
of
Artist,
this
then
automatically terminate or expire, as the case may be, on
the effective termination or expiration date of that portion
of the Island Contract.
in
Minimum Recording Commitment
1.03
The
(a)
respect of each Contract Period shall he Master Recordings
(hereinafter also referred to as "Masters") sufficient to
constitute the number specified below:

Initial Period:

two (2) Albums

First Option Period:

one (1) Album

Second Option Period:

one (1) Album

Company acknowledges that the Album
featuring Artist, "In Tintes of Trouble," has been accepted

by Island, and is the first Album for the Initial Period
hereunder.

Notwithstanding the foregoing, however,

or anything else contained in this agreement, the total
number of Albums delivered during the term, as the same may
be extended or suspended, will not exceed six (6).
1.04

(a)

During each Option Period, Company shall

have the option to- increase the Recording Commitment for
(1)
such
Recordings
equal
to one
Period by Master
additional Album.
Said option is referred to as the "Overcall Right," and the additional Recordings which may be
required hereunder are referred to as "Overcall Recordings
Company shall exercise its option for ali Ovèrcàll Récording
Album, if at all, by written notice to you no later than the
date nine (9) months after the Delivery to Company of the

last Minimum Recording Commitment Album for such Contract
Period.
The
will
be
Overcall
Recordings
(b)
completed and Delivered to Company not earlier than nine (9)

months and not later than twelve

months after the
(12)
Delivery of the entire Minimum Recording Commitment in the
Contract Pe
1.05

Only

Master

Recordings

consisting

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.nipositions not previously recorded by the Artist shall
/ apply in reduction of the Recording Commitment, except as
otherwise provided herein.
ex

hereunder together
Artist's consent.

with

any

other

artist

without

the

1.07
If the Minimum Recording Commitment for the
Contract Period concerned is one Album or less, the entire
Minimum Recording Commitment will be conipleted and Delivered
to Company within the first six (6' months of the Contract
Period.
If the Minimum Recording Commitment is more than
one Album, the first Album will be completed and Delivered

to Company during the first four months of the Contract
Period, and the balance of the Commitment will be completed
and Delivered to Company not earlier than nine (9) months
and not later than twelve (12) months after the Delivery of
the first Album.
The rights granted to
1.08
Licensees include, without limitation:
or disseminate in
portraits, pictures

Company

and

its

The right to reproduce, print, publish
any medium your name,
the
names,

and likenesses of the Artist,
and
biographical material concerning Artist for the purposes of
trade, or for advertising purposes.
Except as provided
herein, during the term of this agreement neither you nor
Artist shall authorize any Party other than Company to use
the name or likeness or Artist in connection with the

advertising or sale of Phonograph Records in the Territory.

All Master Recordings thereon, shall be
the sole property of Company in the Territory, free from any

claims whatsoever by you or any other Persons and Company
shall have the exclusive right to copyright such Master
Recordings in its name as the owner and author thereof-and
to secure any and all renewals and extensioñs øfSuch
copyright in the Territory.

Without limiting the generality of the
fc)
foregoing, Company and any License authorized by Company
shall have the

unlimited

and exclusive rights to mantifacture

Phonograph Records by an method now or hereafter known,
derived from the Master Recordings made hereunder, and to
sell, transfer or otherwise deal in the same under any
trademarks, trade names and labels.

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2

RECORDING PROCEDURE AND RECORDING COSTS

2.01
No recording sessions shall he commenced
(a)
or
shall
hereunder by either
you
Company,
nor
any
incurred
commitments be made
or
costs
connection
in

therewith by either you or Company,

unless and until a

proposed recording budget for the Masters to be recorded at

such sessions has been submitted in writing by you and
mutually approved in writing by you and Company within seven
(7)
days after your submission.
Company or Island shall

pay the recording costs of Master recorded hereunder in
accordance with the terms and provisions hereof, in an
amount not in excess of the approved recording budget for
All such Recording Costs paid by Company or
such Masters.
Island or any other Licensee, (a) shall be deducted from the
Advance payable to Artist under Article 3.01(b)
hereof,

with respect to the Album in connection with which such
costs were incurred and (b) shall be deemed additional
non-returnable Advances to Artist hereunder and shall he
recoupable by Island from the gross royalties payable to
Notwithstanding
Company pursuant to the Island Contract.
the foregoing, however, once Island has recouped the Advance
for the aforementioned first Initial Period Album, Island,
pursuant to the irrevocable authorization and direction of
even date signed by you, Artist, and Company will thereafter
pay all royalties 58.33% to Artist and 41.67% to Company.

Moreover, in recouping Advances hereunder, unrecouped
Advances, charges and other payments incurred with respect

to other artists under the Island Contract shall not be
recouped or cross-aollateralied by Company or Island
against royalties or payments earned or due you hereunder.
(b)
The following matters will be determined in
good fai-th by mutual agreement between yöu and Company.

Except
to the
obtain
order,

as expressly noted otherwise in this agreement, prior
coimuencement of recording in each instance you shall
the approval of Company of each of the following, in
before proceeding further:
the

Selection of material,
number of Compositions to be recorded.

including

Specifications
of
arrangement and copying services, if any.

accompanii2ent,

Subject to the professional availability of
(c)
Artist, Company may designate on fourteen (14) days prior
written notice to Artist, the dates of recording and studios
The above matters shall
where recording is to take place.

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also be subject to the mutual agreement of you and Company.
(d)
You shall submit to Company fully
edited Master Recordings, satisfactory for its manufacture
and sale of Phonograph Records, and Deliver to Company all
original and duplicate Master Recordings of the material
recorded,
with
and
together
all
necessary
licenses
appropriate permissions.

2.02
No "live" Recording or Recording not made in
full compliance wïth the provisions of this agreement will
apply in fulfillment of your Recording Commitment, nor will
Company be required to make any payments in connection with
any such Recording, m1e&s_.Crmpaiyagrees in writing
Recording is actually released by Cö1pany.
2.03
to
subject

Each Master Recording made hereunder shall be
Company's
as
commercially
and
approval

technically satisfactory for its manufacture and sale of
Phonograph Records.
2.04
Company will pay all union scale payments
required to be made to you in connectïon with Recordings
made hereunder, including all costs of instrumental, vocal
and
and
copying
other
personnel
arrangements
and
specifically approved by Company in respect of the recording
of such Master Recordings, and all other amounts required to

be paid by Company pursuant to any applicable law or any
collective
bargaining
agreement between
Company,
its
Licensees or distributors and any union representing Persons
who render services
connection with
in
such
Master
Recordings.
2.05
All amounts described in paragraph 2.04 above
plus all other amounts representing direct expenses paid by

Company, or incurred in connection with the recording of
Master Recordings hereunder (including, without limitation,
advances to producers and a11 studio and engineering
charges), are herein sometimes called "Recording Costs" an&
shall constitute Advances. Any Recording Costs in excess of
sole
will
amount
approved
your
the
Company
be
by
responsibility and will be promptly paid by you
(or
reimbursed by you if paid by Company).
3.

PAYMENTS »ID ADVANCES

Upon execution
of
this
agreement,
3.01
(a
Company will pay you a non-returnable non-recoupable payment
of Fifteen Thousand Dollars ($15,000).
(b)

Subject

to Article

2

hereof,

Company

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following non-returnable recording
shall pay the
fund
Advances to you for each Album recorded hereunder, inclusive
of all Recording Costs.

Amount per Album

Contract Period
Initial Period
first Album ("In Times
(i)
of Trouble")

$15,000.00 (This Advance
is a net amount payable
to you exclusive of ... I

Recording Costs since
this Album was recorded
prior to the Island
Contract. .It is
payable upon executió
of this agreement)
(ii) Second Album

4LJ

$75,000

First Option Period

First Album
Overcall Album

$lO0,OOQL.
i25,000;

Second Option Period

First Album
Overcall Album

$150,000
$175,000

In the event the Island Contract is amended,
(c)
revised or substituted and any of the Album Advances thereby

increased, then the above Advances shailbe automatically
increased up to the amended, revised or substituted amount
in the Island Contract.
Cd)

If al]. approved Recording Costs incurred with

respect to an Album are less than the Advance set forth
:abòvé for such: Albun

thebaIanéof such Mvancé shl1bè'

divided fifty eight & one-third percent (58.33) to you and
forty one & sixty sevenths hundreds percent (41.67%;) to
Company, except, however, that the Advance for the first
Initial Period Advance shall be divided fifteen thousand
dollars ($15,000) to you (as Set forth in Article 3.01(b)
above), arid sixty thousand dollars ($60,000) to Company.
4.

ROYALTIES

4.01
Conditioned upon your performance of the
material terms hereof, Company shall pay to you in respect

of the sale of Phonograph Records embodying the Master

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s
Recordings, royalty equal to fifty eight & one- third
percent (SB.33%) of the applicable gross royalty (including,
but not limited to, percentages of flat fee payments)
payable to Company pursuant to the Island Contract in
respect of Artist Recordings, provided, however, that in no

event will the riet royalty for net sales through normal
retail channels in the United States:

in respect of Albums, be less than seven
percent (7%) of the recommended retail selling price; and

of all other Phónograph
five sixths (5.833%) of the
recommended retail selling price.
respect

in

Records, he less than five

&

if net sales through normal
retàil
channels in the of any Album hereunder (after deduction of
applicablereserves) exceed 500,000 units, then the royalty

on all such sales in excess of 500,000 units shall be
increased by one (1) percent of the recoinmeded selling
price, as defined, paid and computed in the Island Contract,
and such increase shall be paid entirely to you.
4.02
Royalties shall be computed, adjusted paid
pari pas su in the saine manner as the gross royalty and all
other payments based on sales of Records are paid to Company
pursuant to the terms of the Island Contract, including, but
not limited to, proportionate reductions on all sales other
than sales through normal retail channels (e.g., foreign &
record club).

Upon or before execution of this agreement,
and as a material inducement for you to execute and enter
into this agreement, you and Company will execute a letter

to Island in the form of Attachment I attached hereto,
irrevocably authorizing and directing Island to pay directly
to you all royalties, sums and other things of value

required under either this agreement or under the Island
Contract-:

5.

?ISCELLANEOUS ROYALTY PROVISIONS
(intentionally deletedi

6.

ROYALTY ACCOUNTING

6.01

Subject to Articles 2

&

4, hereof, Company

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or Island will compute royalties payable to you hereunder as
of June 30th and December 31st for each preceding six-month
period during which Records as to which royalties are
payable hereunder are sold, and will render a statement and
pay such royàlties, less any unrecouped Advances, prior to
each succeeding October 31st and April 30th, respectively.
6.02
If Company or Island is unable, for reasons
beyond its control, to receive payments for such sales in
United States Dollars in the United States, royalties
therefor shall be credited to your account during the

continuance

of such inability; if any accounting renderéd t

you hereunder during the continuance of such inability
requires the payment of royalties to you, Company will, at
your request and if Company is able to do so deposit such
royalties to your credit in such foreign currency, in a
foreign depository, at your expense. Any taxes required to
be withheld by Coinpany,or its Licensee from its remittance
to Company will be apportioned and deducted ratably from the
royalties and sums credited to your account for the sales
concerned.
6.03
At any time within twenty-four (24) months
after any royalty statement is due you hereunder, you shall

have the right to give Company written notice of your
intention

to

examine

Company's

books

and

records

with

If we audit the books and
respect to such statement.
records.of Island, you shall have the right to participate
at your expense in such audit.
Such examination shall be
commenced within ninety (90) days after the date of such
notice, at your sole cost and expense, by any certified
public accountant or attorney designated by you.
Such
examination shall be made during Company's usual business
hours at the place where Company maintains the books and
Records which relate to you.
6.04
You hereby request and authorize Company to
pay all -Advances, payments,. royalties and monies due you
pursuant to this agreeinentto: Raphael .E.-.Tisdale,: Esquire,
1101 - 15th Street, N.W., Suite 806, Washington, D.C. 20005

6A.

LICEtSES FOR COMPOSITIONS

You will obtain at Company's election and
covering
Company's
benefit,
mechanical
licenses
Compositions embodied on the !aster Recording at a payment
rate no greater than the royalty rate equal to the minimum
compulsory license rate if any, applicable under the
copyright law of the country concerned at the time of
release.
6A.0l. (a) (1)

for

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(2)

For that license , Company will pay Mechanical Royalties

of three-fourths of the minimum statutory rate then in
effect at the time of the initial release of a Record per
Composition for Records sold in the United States.

total Mechanical Royalty for all Compositions

on any album, including Controlled Compositions, will be
limited to the number of Compositions on each album times
the amount which would be payable on it under section
6A.Ol(a) (?) if it contained only one Controlled Composition.
The total Mechanical Royalty on any "single" Record will be
limited to twice that amount.

Company
or
will
compute
its
Licensees
Mechanical Royalties on Controlled Compositions as of the
end of each calendar quarter-annual period for that calendar
quarter. On the next May 15th, August 15, November 15th, or
February 15th, Company or its Licensees in the United States

and Canada will send a statement covering those royalties
and will pay any net royalties whïch are due. Company or
its Licensees in the United States and Canada will not be
required to send a statement for any period in which there
are no sales or returns.
Mechanical Royalty reserves
maintained by Company against anticipated returns and
credits will not be held fer an unreasonable period of time;
retention of a reserve for two years after it is established
will not be considered unreasonable in any case.
6A.02.
You also grant
license, under copyright, to

to Company an irrevocable
reproduce each Controlled

Composition in motion pictures and other audiovisual works
and to distribute and to perform those
("pictures"),
pictures throughout the world for the purpose of marketing
Phonograph Records, and to authorize others to do so,
for a fee to be negotiated in good faith.
If
6A.03
the
Controlled
copyright
in
any
Composition is transferred, the transfer will be made
subjectto this agreement.

7.

WARRANTIES; REPRESENTATIONS:

7.0].

(a)

RESTRICTIONS: INDE!NITIPS

You have the right and power to enter

into

and fully perform this agreement.
(b)

use

thereof,

No Materials, as hereinafter defined, or any

will violate any

law or infringe upon or

violate the rights of any Person. "Materials," as used in
this Article, means: (1) all Controlled Compositions, (2)
each name legal and processional used by you in connection
with Recordings made hereunder or otherwise, and (3) all

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other musical, dramatic, artistic and literary materials,
ideas,
and other intellectual properties,
furnished or
selected by you and contained in or used in connection with
any Recordings made hereunder or the packaging,
sale,
distribution, advertising, publicizing or other exploitation
thereof.

Company and its Licensees shall have the sole
(c)
exclusive riqhts in the Territory to manufacture,
advertise, distribute,,, sell and otherwise exploit and deal
Phonograph
the
Records and, other
in
Masters
and
reproductions derived therefrom (as enumerated in Article i
and

hereof), free from any liability or obligation to make any
payments therefor, except:
the payments to copyright
(1)
the
to in paragraph 6A.Ol. (a) (2),
owners '' referred
(2)
royalties payable to you pursuant to Article 4,. and (:3)
Advances payable to you pursuant to Article 3.
7.02

You arid Company will at all tiznes indemnify

and hold harmless the other from and against any and all
claims, damages, liabilities, costs and expenses, including
legal expenses and reasonable counsel fees, arising out of
any breach by the other of any warranty or agreement made by
The breaching Party will reimburse
th other herein.
on demand for any payment made at any time after the date
hereof in respect of any liability or claim 'in 'respect or
which the other Party are entitled to be indemnified.
7.03

During the term of this agreement, neither

you nor the Artist will enter into any agreement which would

interfere with the full and prompt performance of your
obligations hereunder, and neither you nor the Artist will
perform or render any services, for the purpose of making
Phonograph Records or Master Recordings derived from the

Artist's performances for any Person other than Company
except as provided, herein.

After, the expiration of the term.

of this agreement,. for any reason whatsoever, the Artist
will not perform any .Composition which shafl. have' been
Recorded hereinunder for any Person other than Company' for'
of making Phoncçraph
the
purpose
or
raster
Records
Recordings prior to whichever of the following dates shall
years subsequent to the
be later:
(a) the date five
(5)
date such Composition is Recorded hereunder and released, or
(b) the date three (3) years subsequent to the expiration or
termination date of the term of this agreement. Neither you
nor the Artist shall authorize or knowingly permit Artist's
performances to be Recorded without an express written
on
of
prohibiting the use
such
Recording
agreement
Phonograph
violation
foregoing
Records
in
of
the
restrictions.

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7.04
If you or Artist shall become aware of any
unauthorized Recordings, manufacture, distribution or sale
by any third party contrary to the foregoing re-Recording
restrictions, you arid Artist shall notify Company thereof
and shall cooperate with Company in the event that Company
commences any action of proceeding against such third party.

7.05
The services of the Artist may be are unique
and e>traordinary, and the loss thereof cannot be adequately

compensated in damages, and Company shall be entitled to
injunctive
agreement.
8.

relief

to

enforce

the

provisions

of

this

RELEASE

Provided that you have complied with all of
8.01
your obligations hereunder, Company shall release in the
United States each Album of Artist delivered pursuant to
that Artist's recording obligation within ninety (90) days
after you deliver such Album.
If Company fails to comply
with the preceding sentence, your sole remedy shall.be to
notify Company within sixty (60) days after the end of such,,,
period of your desire that this agreement be terminated if

Company does not so comply within sixty (60) days after
Company's receipt of your notice.
If Company fails to do
so, Company shall have no liability whatsoever to you or the
Artist, but this agreement shall automatically terminate and
you and Artist shall not be further bound by this agreement.
8.02
Company warrants and represents that during
the term hereof
Records released hereunder shall be

all

distributed in their initial release via the same method of
distribution as the albums of the majority of Island's top
"pop" artists (i.e., currently, distribution by Atlantic
Records).
8.03
If,
within
twelve
months
(12)
after
exercising its optïon for'additional product from Artist,
the Company shall fail to récord the minimum number of:
Records provided for Artist, and if, within sixty (60) days
after the expiration of such time period, you shall notify
the Company by registered mail of your rerniest that the

Company the ¡ecording Commitment hereunder, then the Company
shall, either record such performances or pay an amount
equal to forty four (44%) percent of the sum equal to the
Advance due in respect of such product (whether Album or
Single)

for

you,

less

the

recording

costs

for

the

immediately preceding product, but in no event more thant
Fourteen Thousand, Five Hundred Dollars ($14,500) for an
Album or One Thousand Seven Hundred, Fifty Dollars ($1,750)
for a Single.
If the applicable product is Artist's first

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Album,

then

the

amount of the Recording Costs

for

the

preceding product shall be deemed to be the Recording Costs
for that Artist's preceding Single multiplied by eight (8).
Such payment shall be in full settlement of the Company's
obligation in connection therewith.
In the event that you

do not so notify the Company within such sixty

(60)

day

period, then the Company shall be under no obligation to you.
for failure to record such minimum number of Sides.

9.

DEFINITIONS

As used in this agreement, the following terms shall have
the meaning set forth below:
9e01
"Masters" and "Master Recordings" - every
Recording of sound, whether or not coupled wi.th a visual
image, by any method and on any substance or material,
whether now or hereafter known, which is used or useful in
the recording, production and/or manufacture of Phonograph.

Records.
9.02 "Person" and Party" - an individual, corporation,
partnership, association or other organized group of persons
or legal successors or representatives of the foregoïng;
all

9.03
"Records", "Phonograph Recorjs" and "Recordings"
forms
of
now
or hereafter
reproduction
known,

manufactured or distributed primarily for home use, or juke
box use, or use in means of transportation, embodying (a)
sound alone or (b) sound coupled with visual images, e.g.,
"sight and sound" devices.
9.04
"Advance" - amounts recoupable by Company Island
from royalties to be paid to or on behalf of you pursuant

to this agreement.
9.05
"Album"
one or more twelve-inch 33 l./3 rpm
Records, or the equivalent thereof, consisting of at least.
thirty five (35) minutes and not more than forty (40)
minutes in playing time, of newly recorded Sides (including
the first Initial Period Album), which are Recorded in
connection with a specific Album project, but not including
Sides which were Recorded in connection with any other Album
project.
9.06
"Side" - a Recording of sufficient playing time
to constitute one side of a 45 rpm Record, but not less than
two and one-quarter minutes of continuous sound;
9.07
Contract.

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"Territory"

-

the

"Territory"

in the

Island

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9.08
"Licensees"
includes, without limitation,
Island,
Company's distributors,
sub-distributors whether
independent, or branch distribution, who have the right to

manufacture, distribute or sell Recordings pursuant to a
written agreement with Company.
9.09
"Composition" - a single musical composition,
irrespective of length including al]. spoken words and
bridging passages and including a medley.

9.10
"Delivery" or "Delivered" - when ùsed with
respect to Master Recordings, means the actual receipt by
Company of fully mixed and edited Master Recordings,
technically and commercially satisfactory to Company and
or its Licensees'manufacture of
ready
for Company

Records,
Phonograph
and
necessary
all
applicable approvals and consents.

licenses

and

Recording"
"Joint
any
Master Recording
the Artist's performance, together with the
performance of another artist(s) with respect to which
Company is obligated to pay royalties.
9.11
embodying

9.12

"Controlled Composition" - a composition written,

owned or controlled by you in which you have a direct or
indirect interest.

-

"Contract Period1'
9.13
- the Initial Period, or any
OptionPeriod, of the term hereof (as such Periods may be

amended or extended as provided herein).
10.

SUSPENSION
1Ö.0].

D TERMINATION:

EVEITS OF DEFAUP

If at any time you fail,

except solely for

Company's refusal without cause to allow you to perform, to
fulfill your. Recording Cozzmithent within the times set,forth.

herein, then, without limiting Company's rights to recover
damages by reasonof. your failure oranyof it other..;
,
Company shall have the foliowihg options, each exercisable by notice to you:
to suspend the Contract Period, or both;

to terminate the term of this agreement at
any time before you have fully cured the default, whether or
not Company has exercised its suspension options under
subparagraph 10.01(a) and whether or not you have commenced
to cure the default before such termination occurs; and
If Company terminates the term of this agreement under
clause 10.01(b) all parties will be deemed to have fulfilled

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al]. of their obligations hereunder except those obligations
which survive the end of the term (e.g., warranties,

re-recording restrictions, and Company's obligation to pay
royalties.
10.02 Without limiting any other rights you may have,
it is specifically understood and agreed that in the event
of Company's dissolution or the liquidation of Company's
assets or the filing of a petition in bankruptcy or
insolvency or for an arrangement or reorganization by, for
or against Cómpany or in the event of the appointment of a
receiver or trustee for all or a portion of Company's
property, or in the event that Company shall make an
assignment for the benefit of its creditors or commit any
act for or in bankruptcy or become insolvent, shall fail to
fulfill its obligations under this agreement, then at any
time after the occurrence of any such event, you shall have
the option by notice in writing sent to Company at Company's
address last known to you to terminate this agreement.

10.03 If because of: act of God; inevitable accident;
fire; lockout, strike or other labor dispute; riot or civil
commotion; act of public enemy; enactment, rule, order or
act of any government or governmental instrumentality
failure of
(whether federal, state, local or foreign);
technical facilities; failure or delay of transportátion
facilities; illness, refusal or incapacity of Artist, you or
producer; or other cause of a similar or different nature
not reasonably within Company's control; Company or its
Licensees
are
in
the
Recording,
materially hampered
manufacture, distribution or sale of Records, then, without
limiting Company's rights, Company shall have the option by

giving you notice to suspend the then current Contract
Period for the duration of any such contingency plus such
additional time as is necessary so that Company shall have
no less. than thirty... (30): days after the cessation of..such
contingency in which to exercise its option, if any, for the
next following Option Period.
If, the reäson for: Such

'suspension is due to 'a labor aontróversy involving only
Company or its Licensees, such suspension is due to a labor
controversy involving only Company or its Licensees, such
suspension shall be limited to a period of six (6) months.

1].

AGREEHENTS, APPROVM AND CONSENT
11.01

As

to

all

¡nattera

treated

herein

to

be

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determined by mutual agreement, or as to which any approval
or consent is recuired, such agreement, approval or consent
will not be unreasonably withheld.
11.02
Your aqreement, approval or consent, whenever
required, shall be deemed to have been given unless you
notify Company otherwise within ten (10) business days
following the date of Company's written request therefor.

NOTICES
12.01
Except
as
otherwise
specifically
provided
herein, all notices hereunder shall be in writing and shall
be given by registered or certified mail or telegraph
(prepaid), at the addresses shown above or such other
addréss or addresses as may be designatéd by either party.
Notices shall be deemed given when mailed or delivered to a
telegraph office except that notice of change of address
shall be effective only from the date of its receipt. A
copy of each notice to you will be sent to P.O. Box 24122,

Washington, D.C. 20024, or such other address as you may
designate.

OTHER ARTISTS

Prior tò the effective date of this agreement,
13.01
Company and Artist have been involved in, among other
things,
the
recording, marketing and distribution
of

recording acts professionally known as "Tilt," Slim" and
"Arcade Funk."
13.02 In the event either Slim or Arcade Funk becomes
an "Artist" under the Island Contract, then:
(a)

With respect to newly recorded Masters:

If none of the individuals defined
'herein as "you" are the producers, then CompanywiUpay you
a royalty of two percent C2%), of the recommended retail
selling price computed, adjusted and paid in the same manner
paid pari passu as Company is under the Island Contract;....
If any of the individuals defined
herein as "you" are the producers, then, in addition to the
royalty set forth in Article 13.02(a) (i) above, Company and
a
negotiate
separate
the producing
individuals
will
production royalty and production fee for their production
services.
Notwithstanding the foregoing, however, such
separate production royalty for the producing individuals
will not exceed two percent (2%) of the recommended retail

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selling price, and such royalty will be computed, adjusted
and pid in the same manner pari passu as Company is paid
under the Island Contract, except, however, such royalty
(along with the royalty in Articles 4, 13.02(a)(i), and
will not be cross-collateralized or
&
13.02(b) (i)

Iii])

recouped
against any unrecouped advances
or
payments
incurred with respect to Company or other artists± under the
Island Contract.

respect
to
Masters
previously
With
(b)
recordéd, Company and you shall divide the gross royalty&

Advances payable by Island iñ 'the following manner:
fifty-eight

&

one-third

percent

(58.33%) to Company;

forty one & sixty seventh hundredths
percent (41.67%) to you.
(c)

In the event Slim or Arcade Funk become

artists under arrangements between Company or its affiliates
on the one hand and Persons other than Island, on the other
hand, the provisions of Articles 13.02(a) & 13.02(b) shall
apply to such arrangements, except that references to
such
shall
"Island
Contract"
in
Articles
be
deemed. references to the Person(s) who are the other party'to such arrangements.
13.03 As between you and Company, you shall have the
right to use or not use previously recorded Masters and
produce newly recorded Masters featuring "Tilt" in any

manner you deem appropriate, without any payment to Company
or Persons affiliated with it.
14.

MISCELLANEOUS

14 .Ö1 Thiá agreement contá'ins the :entire ,uiidérstañding'
of the Parties hereto, relating. to the subject. matter, hereof

and cannot be changed except by an instrument signed by an
officer of Company and by you. A waiver by either Party of

any term or condition of this agreement in any instances
shall not be deemed or construed
condition for the future, or
thereof.
All remedies, rights,
and agreements contained in

as a waiver of such term or
of any subsequent breach
undertakings, obligations,
this
agreement shall be

cumulative and one of them shall be in limitation of any
other remedy, right, undertaking, obligation or agreement of
either Party.
14.02
bargaining

Those provisions of any applicable collective
agreement

between

Company

and

any

labor

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organization which are required, by the terms of such
agreement, to be included in this agreement shall be deemed
incorporated herein.
14.03 Company may assign this agreement to any Person
who acquires all or substantially all of Company's stock or
assets and, in the ordinary course of business to license
all or some of the rights herein to a Person.

14.04, You shall not be entitled to recoverdamages or,
to terminate the term of this agreement by reason of any
breach by Company of its material obligations hereunder,
unless Company has failed to remedy such breach within
thirty (30) days following receipt of your notice thereof.
Company specifically acknowledges that payment of any sums.
due you hereunder is a material obligation under this
agreement,....whether such payment is to be made by Company or
Island, and that direct payment to you by Island is a
material inducement for you to enter into this agreement.
14.05
The continued involvement of Max Kidd as a
princip&4.of Company is a material inducement for Artist to
sign this agreement. If Max Kidd ceases to be a princip
of Company, or, is not involved in its daily operations for
a period 'of' three (3) consecutive 'months, you shaiÏbave the
right to terminate this agreement by notice to Company
within sixty (60) days of either such cessation or the
expiration of such three month period.

14.06
This agreement has been entered into in the
District of Columbia, and the validity, interpretation and
legal effect of this agreement shall be governed by the laws
of the District of Columbia applicable to contracts entered
into and performed entirely within the District of Columbia,
with respect, to the determination of any. claim,. 4isput.e. o

disagreement which may arise out of the interpretation,
performance, or breach of this agreement. Any, process in
any action or proceeding arising out of any such claim,
dispute or disagreement, may, among other methods, be served
upon you by delivering or mailing the same, via registered

or certified mai]., addressed to you at the àddress first
above written or such other address as you may designate
pursuant to Article 12 hereof.
Any such delivery or mail
service shall be deemed to have the same force and effect as
personal service within the jurisdiction in which such
action or proceeding may be cormenced.
and
in
In
14.06
entering into this agreement,
providing services pursuant hereto, you and the Artist have

and shall have the status of independent contractors and
nothing herein contained shall contemplate or constitute you

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or the Artist as Company's agents, employees, partners or
joint venturers, or create a fiduciary relationsip of any
type.

Company may, in its sole discretion elect to

14.07

appointa Licensee(s) to manufacture,

istribute and/or sell

3n the event Company at any time so appoints a
Licensee, you and Artist each agree to cooperate to the
fullest extent with each such Licensee ini connection with
Records.

the Master Recordings made hereunder.
14.08
Any and all riders and Attachment I annexed
hereto together with this basic document shall be taken

together
Company.

to

constitute

the

agreement

between

you

and

T.T.E.D. RECORDS, INC.

By:

its

Tony' F(,1

1obert Reed

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