DISTRIBUTION & CONSIGNMENT AGREEMENT
Welcome to the Malus Records Incorporated, Malus Records Distribution and Malus Digital (collectively, “Malus”) Distribution & Consignment Agreement ("Agreement"). Use of the Consignment Service hereunder constitutes your agreement to and acceptance of this Agreement. Malus Records, Inc., along with our licensees and assignees referred in this Agreement as “us” and “we” and “Malus”) reserves the right to add, delete and/or modify any of the terms and conditions contained in this Agreement, at any time and in its sole discretion, by posting a change notice or a new agreement on the Site. In the event of substantive changes to the terms of this Agreement, you may be notified by email. If any modification is unacceptable to you, your only recourse is to not use the Consignment Service. Your continued use of the Consignment Service following posting of a change notice or new agreement on the Site will constitute binding acceptance of the changes.
1. Agreement.
1.1. Consignment Service. This Agreement provides the terms and conditions under which Malus provides its service that will allow you to create, produce, market, and/or sell Products on but not limited to Malus.com, Malusdigital.com, Malusdistribution.com, Malustoken.com, Maluscoin.com and Clubmalus.com websites (collectively, “Malus Records Distribution“) and/or through its distribution arrangements and or distribution services.
1.2. Terms of Service. If you become a Malus Influencer, you will continue to be bound by all of the terms and conditions of the Terms of Service, which are incorporated into this Agreement by this reference. For clarity, the Consignment Service is deemed part of the "Malus Service." All initially-capitalized terms not defined in this Agreement are defined in the Terms of Service and any disputes you may have relating to your use of the Consignment Service will be subject to confidential binding arbitration in accordance with the Terms of Service. If the terms of this Agreement conflict with the Terms of Service, this Agreement will govern and be given precedence.
2. Becoming an Influencer and or Artist collectively "Influencer" or "Artist."
2.1. Opening an Account. Only Malus Influencer and or Club Malus Musician’s have the right to use the Consignment Service. To become a Malus Influencer, you must open a Club.malus.com - VIP Influencer (Platinum) account (an "Account") with Club.malus.com through its online registration process.
2.2. Contact Information. You must provide Malus with accurate and complete contact, payment and tax identification information when you open an Account. You must immediately notify Malus if any of this information changes. If you do not provide Malus with complete, accurate, and updated contact, payment and tax identification information, you may not be eligible to sell Products for a commission and payments may be temporarily withheld.
2.3. Account Security. You will need to select a password if you open an Account. You will be solely and exclusively responsible for keeping your password confidential and all use of your password and Account, including, without limitation, any use by any unauthorized third party. You must notify Malus immediately if you believe your password has been or may be obtained or used by any unauthorized person or entity. In addition, you must notify Malus immediately if you become aware of any other breach or attempted breach of the security of your Account or the Malus Service.
3. Your Obligations.
3.1. General. You must use the Consignment Service in a manner that demonstrates respect for the rights of Malus and third parties and in accordance with applicable laws and regulations.
3.2. Artist Content. If you open an Account, you will be solely and exclusively responsible for ensuring that your Account, any content or materials that you submit to Malus for use with your Products ("Content"), and any websites linked to your Account pages comply with the terms and conditions of this Agreement and all applicable laws, regulations and rules. Malus has no obligation to monitor the transactions or communications made through its Website, it reserves the right, in its sole and absolute discretion, to cancel any transaction or remove or limit access to any Content from the Website at any time without notice and without any liability to you or any third party.
3.3. Prohibited Content. You may not design, produce, market or sell a Product that Malus believes: (i) infringes the rights of a third party, including, without limitation, copyrights, trademarks, patents, trade secrets, and rights of privacy and publicity; (ii) is defamatory; (iii) is obscene or pornographic; or (iv) violates any applicable law, rule, or regulation, including, without limitation, by exploiting images or the likeness of minors.
4. Licensing Your Content to Malus. By sending us or uploading any of your Content for use on the Website, you grant to Malus a royalty-free, worldwide, transferable, nonexclusive, right and license in such Content, in all media existing now or created in the future: (i) to permit you to use the Consignment Service to market and sell Products, and (ii) to promote, market and advertise your Products as part of the Malus Service, in those places where we advertise our services or Products. Without limitation, this promotion, marketing, or advertising may consist of: (i) display of your Products on the Website, (ii) promotional "streams" of audio Content on the Website, and (iii) Product or Content placement in magazines, web sites, Malus advertisements, and other media specifically excluding television and movies, solely in connection with our promotion of the Malus Service. Malus may sublicense the rights that you grant it in this Section. This Section 4 only gives Malus the right to use your Content for the purposes stated above, and does not give Malus ownership of any of your Content, or a license to use your Content other than as specifically stated above.
5. Product Creation.
5.1. Delivery of Content. You will upload or ship to Malus all Content that you want to use with the Consignment Service in accordance with the applicable instructions on the Website. You must also upload or ship all other Content required to package and market any of your Products, such as cover artwork, titles, and complete and accurate credits. Malus may, in its sole and exclusive discretion, determine whether any Content complies with such instructions and is satisfactory for use with the Consignment Service.
5.2. Approvals and Consents. You must either own all rights, title and interest in and to the Content, including all intellectual property rights therein, or you must otherwise have all necessary approvals and consents to use all Content and, if requested by , you must deliver copies of those approvals and consents to Malus. Without limiting the above, you are responsible for and must pay any royalties or similar payments that are or may become due to any third party, such as all payments for third-party material in your Content.
5.3. Costs of Creation and Delivery. You will be solely responsible for the creation of the electronic and digital Content that you upload or ship to Malus and for all physical Products which are held on consignment by Malus on your behalf, and will pay all costs associated with its creation and copies thereof. Without limitation to the above, you will be responsible for all shipping charges and insurance on the Product during shipment and delivery.
5.4. Maintaining and Returning Stock. Malus reserves the right to charge a fee to ingest and store any physical product you send to us in excess of the amount we requested. We reserve the right to return Product to you from time to time, as deemed appropriate by Malus in our sole discretion, and at the Malus Artist’s expense. Conversely, for titles that have not sold for a period of 12 months we reserve the right to charge a storage fee. Malus will notify you of its intent to return Product or charge a storage fee as applicable. If you do not respond to any return notice from Malus within 21 days of the date of the request, or if Malus’ attempt to return Products is unsuccessful because of inaccurate addresses on file, then Malus shall have the right to recycle or discard the Products without compensation to you for the recycled Product. Malus will contact you at the current address on file to notify you of the exhaustion of Product stock on hand and request additional shipments. You agree to comply with minimum stock levels for the Product as established by Malus from time to time.
5.5. Customer Returns. Malus does not accept customer returns unless they are from a vendor or retail. Vendor or retail returns will be restocked, debited from the Malus Artist’s sales and added back to active inventory. Any returned Product that is defective or damaged will not be restocked, will be debited from the Malus Artist’s sales and will be returned or recycled, at Malus’s discretion.
5.6. Insurance. You acknowledge and agree that although Malus does carry insurance relating to Product stored by Malus under this Agreement, Malus will not be responsible for loss absent Malus’s gross negligence or intentional misconduct. If you desire for the Product inventory to be insured, you must obtain such insurance at your cost.
6. Marketing and Advertising Your Products.
6.1. Marketing of Your Products. Malus reserves the right, but has no obligation, to promote or advertise your Products, for example, featuring them in Malus newsletters or on the Website, referring Users to your Products, or describing your Products in communications with third parties
6.2. Customer Information. Malus may, from time to time, provide you with information relating to Customers that purchase Products via the Consignment Service. You may only use or disclose this information to a third party for your internal record keeping. You may not disclose any of this information to a third party or use it for any other purposes. In all events, you will comply with the terms of Malus’s privacy policy http://privacy.malus.com in connection with the Customer data provided under this Agreement.
7. Compensation and Fees.
7.1. Tax Information. If you choose to sell Products through the Consignment Service, Malus will use its reasonable efforts to collect sales tax owed on the sales of the Products offered thereby (“Sales Tax”), and to remit such Sales Tax on your behalf to relevant government authorities. Notwithstanding the above, in all events, you acknowledge and agree that you are ultimately responsible for the payment of any Sales Tax owed in connection with this Agreement, and you hereby indemnify Malus for any Sales Tax that may be owed in addition to those amounts collected and remitted on your behalf by Malus hereunder.
7.2. Pricing Terms for Products. You will have the discretion to set the pricing for your Products on Malus, provided that in all events the price must exceed the Malus Fee (defined below).
7.3. Payment Terms & Fees. For each sale of your “Products” through the Site (or sold by Malus through its distributors), Malus shall collect the aggregate amounts from the customer or distributor, and shall retain its processing fee, the “Malus Fee” and the Sales Tax and shall remit any remaining amounts to you (the “Artist Payment”). “Malus Fee” for distribution onto any of the Malus Serivices, including but not limited to Malus.com Malusdistribution.com, malus.digital, and Clubmalus.com; 27% of Sale, plus any processing fees (Paypal). “Malus Fee” for digital distribution through our digital aggregate partners; 11.5% of Sales (2.5% processing fee for distribution partners). “Malus Fee” for Physical Distribution; 11.5% plus any manufacturing or garment fulfillment cost of the wholesale/distributor price. “Malus Fee” for manufacturing; 27% plus any set up fees. “Malus Fee” for garment fulfillment; 100% of cost garment plus 11.5%. Malus will make a payment to you (by check, wire or electronic transfer) for the amount of the Artist Payment no later than 15 days after the revenues were received and your payment threshold has been met. The default payment threshold is $50 and can be changed at anytime as long as it meets the minimum threshold of $10. If you have provided an undeliverable mailing address and two or more consecutive payments have been returned to Malus as undeliverable, we may stop sending future payments to you until you provide a deliverable mailing address.
7.4. Charitable Contribution. Unless you and Malus otherwise agree in writing, Malus may at its sole option remit any payment otherwise due to you as a contribution in your name to a 501(c)(3) charitable nonprofit organization of Malus's choice if: (i) you fail to provide Malus with accurate and complete contact and tax identification information; and (ii) the funds remain outstanding for more than 12 months and your payment threshold has not been met. If Malus makes such a contribution, its obligation to you shall be reduced by the amount of that contribution.
8. Indemnification. As you are bound by the Terms of Service in using the Consignment Service, you must indemnify, defend and hold Malus harmless for any Claim arising out of, relating to, or connected with your alleged breach of the Terms of Service in using the Consignment Service in accordance with the Terms of Service. You must also indemnify, defend, and hold Malus harmless based on any Claim alleging facts that, if true, would constitute a breach of this Agreement. Malus may withhold any payments that it owes you if you have to indemnify Malus.
9. Termination.
9.1. Malus Termination. In its sole discretion, with or without notice to you, Malus may: (i) suspend, limit your access to or terminate your use of the Consignment Service, (ii) suspend, limit your access to or terminate your Account, (iii) remove any of your Content from Malus's servers and directories and (iv) prohibit you from selling any new Products through the Consignment Service.
9.2. Malus Artist Termination. If you are a Malus Artist, you may terminate your Account for any reason at any time by contacting our customer service department at (844) MALUSCO (625-8726). Our service hours are from 7:00am PST to 9:00pm PST, Monday through Friday, and 7:00am PST to 9:00pm PST, Saturday and Sunday.
9.3. Termination Fees. There are no account termination fees. If for some reason at time of termination a Malus Artist owes Malus moneys at time of termination, any outstanding balance must be paid to Malus prior to account termination.
9.4. Effect of Termination. If you or Malus suspend or terminate your Account, you understand that we will cease making the Products available through the Consignment Service. Accordingly, Malus may, without being liable to you or any third party: (i) delete any Content or other materials relating to your use of the Consignment Service, and (ii) not allow you to create, produce, market, or sell Products through the Consignment Service. If you or Malus terminate your Account, you must immediately remove all links to the Website from any websites you operate and cease representing yourself as a Malus Artist. This provision relates to our relationship and the Consignment Service, and does not affect your creation or sale of Products through other third party systems.
9.5. Survival. The following Sections will survive termination of your Account: 1, 3, 4, 5.2 through 5.5, 7, 8, 9.3, and 9.4.