STONE DRAGON PRESS
STANDARD "RICH AND FAMOUS "
ART CONTRACT

For public review

Contact Info

December, 1998

Below is our model contract. This is the contract we present to artists when we want to license their properties. If you execute a cover or illustrations for us, your specific contract with us will be confidential.

We have presented this contract as a service to artists. We have nothing to hide, and we want to de-mystify the publishing process . Please do us the favor of not stealing our hard work (this contract) from us and using it for your own purposes. You may make a copy of this for discussion and review purposes only. Duplication for any other purpose is forbidden without the express, written consent of Stone Dragon Press.

Thank you very much.

artistaddr1
artistaddr2
artistcity artistst artistzip
artistcountry;

3418 Morgan Ave N.
Minneapolis, MN USA 55412-2336

1. GRANT
   1. The Artist grants to the publisher for a period of five (5) years from the date of first publication of nameofbook ("the book") the exclusive license to use only for the production, sale, advertising, and promotion of the book a Work now entitled name of cover for name of book ("the cover") .
   2. The artist does not grant to the publisher the rights to publish and sell a form of the cover for an ebook, where ebook form is defined as the electronic storage and distribution of the unchanged text of the book or an image of its unchanged pages.
   3. The cover is a tangible or electronic work that reflects some content of the book or some content agreed upon with the author of the book.
      1. The territory of this grant shall be the United States of America, its territories and possessions, the Philippine Islands, and Canada,
      2. All other territory (except the British Commonwealth, not including Canada but including the Republics of South Africa and Eire, the British Trusteeships and Rhodesia) shall be an open market for the sale of the cover under this agreement.
   4. For the purposes of this contract, all sales of the book made by electronic transmission--including (but not limited to) sales via the internet, the World Wide Web, email, fax, and phone--shall be construed as sales made in the United States.
   5. Upon the expiration of this agreement five (5) years from the date of original publication,
      1. The Publisher shall have first option to conclude an agreement with the artist for continued publication rights to the cover on terms to be mutually agreed upon.
      2. The Publisher shall have first option to conclude an agreement with the artist for ebook rights to the cover (as defined in this section [Grant]) on terms to be mutually agreed upon.
      3. Should no such agreement be concluded within sixty (60) days of the expiration of this agreement, the publisher retains the license rights granted in this agreement until specifically notified in writing by the artist.
      4. The Publisher retains the license rights for ninety (90) days after such notification.

2. REPRESENTATIONS AND WARRANTIES
   1. To the best of her knowledge, the artist warrants and represents:
      1. she is sole artist and proprietor of the cover
      2. she is the sole owner of the rights granted here
      3. she has the full right, power, and authority to enter into the agreement and to grant the rights granted here
      4. that except for materials of others (which she has obtained or will obtain permission to use), the cover is original
      5. neither the cover nor any material portion of it is in the public domain
      6. it infringes no right of privacy
      7. it contains no matter which is libelous
      8. it does not violate any personal or other right of any kind of any person or entity
      9. it contains no material that would violate any contract of hers, express or implied
      10. it contains no material that would disclose any information given to her on the understanding that it would not be published or disclosed
      11. it contains no material that plagiarizes or pirates any other artwork or infringes any copyright, trademark, or other proprietary right
      12. she will not enter into any agreement or understanding that would conflict with the rights granted the publisher during the term of this agreement.
   2. The Artist shall hold harmless and indemnify the publisher, its distributors, and any retailer from any recovery finally sustained by reason of any violations of copyright or other property of personal right.
      1. If there is a violation, she will reimburse the publisher for all court costs and legal fees incurred, provided
         1. the publisher shall with all reasonable promptness notify the artist of any claim or suit which may involve the warranties of the artist hereunder; and
         2. the publisher agrees fully to cooperate in the defense thereof.
      2. Any out of court settlement of any suit filed jointly against the artist and the publisher shall be made only by mutual agreement in writing between them.
   3. The warranties contained in this paragraph do not extend to drawings, illustrations, or other material not furnished by the artist.

3. PRODUCTION AND DELIVERY
   1. The Artist agrees to deliver to the publisher on or before DATE and in final revised form
      1. one copy of an artwork suitable for use as a book cover and
      2. if the cover is electronic, computer disks of the artwork compatible with the publisher's computerized system (any file that can be read by software for the Macintosh without loss of formatting).
   2. The artist agrees to pay for this delivery.
   3. The artist further agrees to furnish
      1. any other related materials (the "related materials");
      2. any written authorization by all third-party proprietors of copyrighted text and illustrative material contained in the cover;
      3. the proper forms of copyright notice for such material.
      4. If the artist fails to obtain such permissions or provide such notices, the publisher may do so and charge the cost to the artist.
   4. All related materials will be satisfactory to the publisher in form and content. If
      1. the artist fails to deliver any of the related materials or
      2. the related materials are not satisfactory to the publisher in form or content,
      the publisher may obtain, create, or revise the missing or unsatisfactory materials and charge the reasonable cost of doing so to the artist.
   5. If the artist
      1. fails to deliver said cover to the publisher within three (3) months after said date or
      2. delivers the cover but otherwise breaches this agreement,
      the publisher may, at its option,
      1. terminate this agreement by notice in writing and
      2. recover from the artist all monies which it may have advanced to the artist upon the cover.
   6. If the publisher (in its sole discretion and opinion) deems the cover unacceptable or unsatisfactory in form or content at any point in the process outlined in §7 (Galleys and Proofs) , the publisher may reject it by written notice within thirty (30) days of delivery; in which case:
      1. any sums previously advanced or kill fees paid to the artist under this agreement shall be retained by the artist
      2. at the publisher's option, this agreement may be deemed terminated
      3. there shall be no further obligation upon the publisher to publish said cover or to make any further payment under this agreement
      4. all rights granted to the publisher under this agreement shall revert to the artist.
   7. Whether the publisher accepts the work or not, it agrees
      1. to return all original artwork to the artist within 90 days of first publication of the work and
      2. to take reasonable care in protecting the artwork during return;
   8. The artist agrees to make the work available again as necessary for recreating any covers lost by the publisher for any reason.

4. PUBLICATION
   1. If the publisher fails to publish and distribute the book,
      1. the publisher must notify the artist within ninety (90) days of failure to publish the book that it has lost the right to publish the book.
      2. the artist may retain any payments made under this agreement, and such payments shall be deemed to fully discharge all of the publisher's obligations to the artist.
      3. No other damages, claims, actions, or proceedings (legal or equitable), founded on breach of contract, default, or failure to publish may be pursued against the publisher by the artist or her agents, heirs, or assigns.
   2. In no event shall the publisher be obligated to publish or have any liability to the artist for failure to publish (or any related cause of action) the cover when
      1. either the artist or the publisher has been given notice of a claim, demand, or suit alleging the cover infringes the copyright or otherwise violates any other right of third parties
      2. the cover contains libelous or obscene matter
   3. The publisher will not be obligated to publish the cover if the publisher's legal counsel is of the opinion that it contains unlawful material or material that violates the rights of any person or entity.
      1. If it is the publisher's opinion that there appears to be a substantial risk of legal action or liability because of the cover, the artist will make any necessary revisions or deletions to remove any such risk.
      2. If the artist does not make or authorize the publisher to make said revisions or deletions, or if the publisher's legal counsel deems the cover is unpublishable, then the publisher may terminate this agreement in writing any time before publication.
      3. In the event of such termination, the artist shall promptly repay any and all amounts advanced by the publisher under this agreement, except kill fees as described in §7 (Galleys and Proofs) .
   4. The publisher has the sole discretion to decide
      1. the cover's format; cover presentation; trademark; logo; imprint or other identification; and
      2. the book's terms of sale, distribution, advertising, and promotion.

5. COPYRIGHT
   1. Within three (3) months of first publication, the publisher is hereby authorized and mandated to
      1. duly register a claim for a United States copyright to the cover in the name of the artist as "claimant"
      2. print in every copy of the book a copyright notice about ther cover required by United States law and the Universal Copyright Convention
      3. fulfill all other obligations necessary to protect the cover's copyright under United States law and the International Copyright Convention
      4. require every license granted under this agreement to reproduce and distribute copies of the cover to contain a condition for the licensee to print the above copyright notice in all copies.
   2. On the termination of the first term of copyright, the artist shall
      1. make timely application for renewal of copyright under then existing United States copyright law
      2. assign to the publisher, for the renewal term of the copyright, the rights herein granted to the publisher, provided this agreement shall then be in force and effect.
   3. If the copyright in the cover is infringed by a third party
      1. Whichever party to this agreement first learns of the infringement will inform the other.
      2. Neither the artist nor the publisher will be required to bring suit. Should one party decline to participate in a suit, the other party may proceed, bearing all expenses and retaining all sums recovered.
      3. The Publisher shall not be liable to the artist for the publisher's failure to take such legal steps.
      4. The Publisher may, at its own expense, take any legal action required to restrain such infringement or to seek damages from it.
      5. The Publisher may take this action in the artist's name, if necessary.
      6. The Artist will have the right to fully cooperate with the publisher in bringing suit against the alleged infringer.
   4. Money damages recovered for an infringement shall be applied
      1. first, toward the repayment of the expense of bringing and maintaining the action
      2. thereafter, the balance shall belong to the artist, except
      3. any money damages recovered for the loss of the publisher's profits shall be divided between the artist and the publisher in the same ratio as the royalties.

6. EDITING RIGHTS
   The Publisher and its agents and employees will not change, add to, or delete from the cover without the express, itemized, and specific written consent of the artist.

7. GALLEYS AND PROOFS
   1. In creating the cover, the artist agrees
      1. to provide at least one (1) initial design for the cover for the author's review ("the pencils") and as many as three (3).
      2. to provide a second-stage design
         1. incorporating alterations to the pencils based on author's review and
         2. showing for the author's review an initial palette of sample colors to be incorporated in the final cover
      3. to execute a final design incorporating alterations to the sample colors based on author's review.
   2. Should the publisher exercise its right to terminate as outline in §3 (Manuscript and Delivery) , the artist shall be paid $10 for each design completed at the time of termination ("kill fee").
   3. Notwithstanding anything to the contrary herein contained, before printing the book jacket of the work, the publisher shall submit a proof or other facsimile of the jacket text and design for the artist's written advance approval, which shall not be unreasonably withheld.

8. NON-COMPETITION
   1. During the term of this agreement, the artist shall not permit or arrange for the publication, distribution, or sale in the territory defined in §1 (Grant) other than by the publisher, of any cover that is
      1. directly competitive with the cover
      2. likely to diminish its sale, the value of any subsidiary rights, or the value of any additional rights granted by this agreement.
      not including ebooks as defined in §1 (Grant).
   2. The artist may grant licenses for the exploitation of any rights reserved to the artist under this agreement.

9. ROYALTIES AND LICENSES
   1. The Publisher shall pay to the artist or her duly authorized representatives, the following advances and royalties:
      1. No advance shall be paid for this cover.
      2. A royalty upon the regular edition sold in the United States and Canada of two and one-half percent (2.5%) of the retail price on all copies of the book sold.
      3. A royalty upon the large print edition sold in the United States and Canada of two and one-half percent (2.5%) of the retail price on all copies of the book sold.
      4. A royalty of two and one-half percent (2.5%) of the amount of the publisher's charges for bound copies of the original edition of the book sold
         1. for export,
         2. to reading circles,
         3. to recognized book clubs, and
         4. to organizations outside the regular bookselling channels,
         provided that such sales are made at a discount of sixty percent (60%) or more from the retail price.
      5. Two and one-half percent (2.5%) of the proceeds of any license granted to another Publisher to bring out a reprint edition of the book if the cover is used on the book.
      6. Two and one-half percent (2.5%) of the gross amount paid by a book club, whether as plate rental or royalty or otherwise, for the right to publish the work for distribution to its members if the cover is used on the book.
      7. Of the publisher's charges for copies of overstock,
         1. two and one-half percent (2.5%) of the amount of which the publisher deems expedient to sell at a discount of seventy percent (70%) or more
         2. zero percent (0%; no royalty) if such sale is made at or below cost of manufacture.
      8. No royalties shall be payable of free copies furnished to the artist or the author of the book or on copies for review, sample, or other similar purposes, or on copies destroyed.
   2. The publisher may reserve such royalties sufficient to cover overpayment of royalties due to returns. This reserve may not exceed 35% of sales during the first year and 20% thereafter.
   3. If the publisher determines to remainder its entire stock, it shall give the artist reasonable notice in advance thereof.

10. NOTIFICATION AND PAYMENT
    1. The Publisher agrees promptly to advise the artist of the terms of any contracts entered into for any grant or license permitted under this agreement whenever the artist's share of the proceeds or royalty is one hundred dollars ($100.00) or more.
    2. Such contracts shall be made available by the publisher to the artist or her representative at the office of the publisher; and a copy thereof will be furnished the artist upon her written request.
    3. The Artist's share of such proceeds or royalty shall be promptly paid to her upon receipt by the publisher and shall in no case be applied against any unearned advance on the publisher's edition of the work.

11. SUBSIDIARY RIGHTS
    1. Upon mutual agreement between the publisher and the artist, the publisher may act as the artist's agent in any other subsidiary rights matter, in which event
       1. the publisher receives ten percent (10%) of the amount paid and
       2. the artist receives ninety percent (90%)
    2. The legal rights to make agreements for subsidiary rights, licensing or sale remains with the artist.

12. RESERVED RIGHTS
    1. All rights in the cover now existing, or which may hereafter come into existence, not specifically herein granted are reserved to the artist for her use at any time.
    2. Reserved publication rights include, but are not limited to, the right to publish or cause to be published in any form, the cover or excerpts of the cover to be used for advertising and exploitation of motion pictures and televised motion pictures or dramatizations based upon the book.

13. STATEMENTS AND PAYMENTS
    1. The Publisher shall forward to the artist or her agent royalty statements to be computed as of June 30 and December 31 of each year of this agreement within thirty (30) days following such respective dates along with any payments indicated to be due thereby.
    2. The Artist or her duly authorized representatives shall have the right upon written request to examine the publisher's accounts during normal business hours insofar as they relate to the cover and any other of the artist's covers under contract to the publisher.
       1. If discrepancies between royalty statements and the publisher's accounts total more than one hundred dollars ($100.00) in the artist's favor under this and any other agreement between the artist and the publisher, the publisher shall tender such monies due to the artist within ten (10) days, along with reimbursement in full for any duly verified expenses incurred by the artist as a result of the auditing procedure.
       2. Should such discrepancies total less than one hundred dollars ($100.00) in the artist's favor, the publisher shall tender such money due to the artist within ten (10) days but shall not be liable for reimbursement of the artist's expenses.

14. OVERPAYMENT
    In all instances in which the artist shall have received an overpayment of monies under the terms hereof, the publisher may deduct such overpayment from any further sums payable to the artist in respect to the cover, provided, however, that the term 'overpayment' shall not in any event apply to unearned advances.

15. ARTIST'S COPIES
    The Publisher agrees to present to the artist three (3) free copies of the regular edition of the book. The Artist shall be permitted to purchase further copies for her personal use at a discount of thirty percent (30%) of the retail price.

16. REVERSION AND TERMINATION
    1. The book shall be considered in print so long as it is available for sale through normal retail and wholesale channels (as defined §1 (Grant)) in any edition from the publisher or its licensee.
    2. At any time after two (2) years from the date of first publication, but not before, the publisher may, on three (3) months' notice in writing to the artist or her representative, discontinue publication. In that event, this agreement shall terminate and all rights hereunder shall revert to the artist at the expiration of said three (3) month period.
    3. If the publisher shall, during the existence of this agreement, default in the delivery of semi-annual statements or in the making of payments as herein provided and shall neglect or refuse to deliver such statements or make such payments, or any of them, within thirty (30) days after written notice of such default, this agreement shall terminate at the expiration of such thirty (30) days without prejudice to the artist's claim for any monies which may have accrued under this agreement or to any other rights and remedies to which the artist may be entitled.
    4. If the publisher shall
       1. fail to comply with or fulfill the terms and conditions hereof, or
       2. in the event of bankruptcy, etc., as provided in §19 (Bankruptcy and Insolvency),
       *then this agreement shall terminate and the rights herein granted to the publisher shall revert to the artist. In such event, all payments previously made to the artist shall belong to the artist without prejudice to any other remedies which the artist may have.
    5. Upon the termination of this agreement for any cause under this paragraph or §19 (Bankruptcy and Insolvency) hereof,
       1. all rights granted to the publisher shall revert to the artist for her use at any time
       2. the publisher shall return to the artist all property originally furnished by the artist
       3. the artist shall have the right in such instance to purchase the electronic file of the cover or any printed covers of the book from the publisher at a price not to exceed fifty percent (50%) of the manufacturing cost.
    6. If the artist shall not have acquired such electronic files or printed covers within ## (##) days of the effective date of such termination, the publisher shall have the right to sell such files or covers at cost or less, without payment to the artist of royalties on such sales.
       1. No such sale by the publisher shall transfer the right of publication and sale of the cover to any purchaser of the remaining files or covers.
       2. The Publisher's privilege to sell the remaining copies shall expire six (6) months after the effective termination date and thereupon all remaining copies shall be destroyed.
       3. If the publisher shall desire to scratch these electronic files, she shall give the artist ## (##) days notice in writing thereof and an opportunity to acquire such electronic files as above provided.
    7. In the event that the parties shall have agreed to the taking of the copyright in the name of the publisher, then the publisher shall, upon such termination, furnish the artist an assignment of such copyright to her in due for recording.

17. BANKRUPTCY AND INSOLVENCY
    1. If
       1. a petition in bankruptcy shall be filed by or against the publisher
       2. the publisher is judged insolvent by any court
       3. a Trustee or a Receiver of any property of the publisher shall be appointed in any suit or proceeding by or against the publisher
       4. the publisher makes an assignment for the benefit of creditors or takes the benefit of any bankruptcy or insolvency Act
       5. the publisher liquidates its business for any cause whatsoever
       *then this agreement terminates automatically without notice. The termination shall be effective as of the date of the filing of such petition, adjudication, appointment, assignment or declaration or commencement of reorganization or liquidation proceedings, and all rights granted here revert to the artist.
    2. As a condition of the making of this agreement, the artist hereby acquires the right, upon such termination, to purchase at her option the text files, remaining copies and sheets as provided in §18 (Reversion and Termination) hereof.
       1. In the event that the artist's option to purchase such properties is not exercised within thirty (30) days after the artist has received notice of the event herein referred to, the publisher, Trustee, Receiver, Assignee or other such official may scratch the electronic files and sell the printed covers of the book remaining on hand subject only to payment to the artist of the royalties herein provided.
       2. In the event the artist desires to purchase the aforesaid books' covers, and the Trustee, Receiver or other said named official deems the price fixed at fifty percent (50%) of the manufacturing cost to be below the fair market value thereof, then such value shall be determined by arbitration conducted pursuant to commercial arbitration Rules of the American Arbitration Association then applicable.

18. ASSIGNMENT
    No assignment of this contract, either voluntary or by operation of law, shall be binding upon either of the parties without the written consent of the other, provided, however, that the artist may assign or transfer any monies due or to become due under this agreement.

19. ARBITRATION
    1. Any controversy or claim arising out of this agreement or the breach thereof shall be settled by arbitration in accordance with the rules then obtaining of the American Arbitration Association.
    2. Such arbitration shall be held in the City of St. Paul, MN, unless otherwise agreed by the parties.
    3. Judgement upon the award may be entered in the highest court of the forum State or Federal that has jurisdiction.
    4. In the case of failure to pay royalties, the artist may refuse to arbitrate and may pursue her legal remedies.

20. NOTICES
    1. Any written notice required under any of the provisions of this agreement shall be deemed to have been properly served by delivery in person or by mailing the same to the parties hereto at the addresses set forth in above.
    2. The addresses may be changed by notice in writing.
    3. Notices of termination shall be sent by registered mail.

21. WAIVER
    1. A waiver of any breach of this agreement or of any of the terms or conditions by either party thereto, shall not be deemed a waiver of any repetition of such breach or in any wise affect any other terms or conditions hereof.
    2. No waiver shall be valid or binding unless it shall be in writing and signed by the parties.

22. DOCUMENTS
    If any of the rights granted to the publisher revert to the artist, the publisher shall execute all documents which may be necessary or appropriate to revest all such rights in the artist.

23. LAW
    This agreement shall be construed in accordance with the laws of the State of Minnesota.

24. INHERITANCE
    This agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators and assigns of the artist, and upon and to the su ccessors and assigns of the publisher.

25. ALTERATION
    This agreement may not be modified, altered or changed except by an instrument in writing signed by the artist and the publisher.

This contract is the property of Stone Dragon Press.
Please do not duplicate without permission.
You may make a copy for review and discussion purposes.

For more information about
our publishing house, please contact:

Stone Dragon Press 3418 Morgan Ave N. Minneapolis, MN USA 55412-2336 E-Mail: