This is a once-in-a-lifetime opportunity to earn royalties from the recording catalog of the Grateful Dead, one of the most iconic rock bands of all time. This Peer Advance includes the rights to royalty payments from all of the Grateful Dead's studio and live albums recorded between 1968 and 1995.
This Peer Advance is offered on a first-come, first-served basis. Keep reading for more details.
WHAT IS A PEER ADVANCE?
With a Peer Advance, the investor is buying limited-term rights to collect royalty income until a fixed return is achieved.
In this case, the investor will pay $135,300 for the right to collect the first $45,000 of the owner's share of royalty income in each year until the investor receives a total of $180,000. The repayment is expected to be satisfied in four years. The total return equals 32.8% with an annual return of 8.2%.
The owner has earned at least $68,000 from the asset in every year since 2012. You can view a summary of the yearly income in the "Financials" tab.
What is the Royalty income stream?
The investor is purchasing the rights to the first $45,000 in yearly revenue derived from the owner's interest in the exploitation of the Grateful Dead studio and live album sound recordings recorded between 1968 and 1995. This includes new releases of previously recorded material.
HOW DO PAYMENTS WORK?
The owner's accountant will collect and distribute the first $45,000 in revenue generated by the catalog to the investor once each year in July. The owner will retain all yearly revenue in excess of $45,000. The investor's payments will continue until the investor recoups $180,000. As soon as the investor recoups $180,000, the owner will again receive 100% of their royalties. If the revenue does not reach $45,000 in any calendar year, the shortfall will be added to the following year's repayment amount.
The first payment to the investor will be in July 2018.
Historic royalty income is no indication of future royalty income. Future royalty income is dependent upon future sales and licensing revenue generated by the sound recordings or compositions associated with this listing.
Information presented is not intended to be investment, tax or legal advice. Past performance of this royalty stream is no guarantee of future results. Estimated or projected investment returns and payback periods are not guaranteed, and investors may lose some or all of the principal invested. Investors should consult their financial advisor if they have any questions or need additional information.
Public performance royalties are payments made by radio stations, hotels, restaurants, night clubs, etc. to the composition copyright holder(s) for each public performance of the copyrighted work. In the U.S., public performance royalties are typically paid to performing rights organizations (e.g., ASCAP, BMI) who then distribute the royalties to the copyright holder(s).
Mechanical royalties are royalties deriving from per-unit payments made by recording companies or digital download providers to the composition copyright holder(s) for every purchase of a sound recording that reproduces the copyrighted composition.
Non-interactive digital performance royalties are payments made by non-interactive music services (i.e. those that mimic the experience of a radio broadcast) of a statutorily-set amount (on either a per-play or annual basis—depending on the type of service) to SoundExchange for the benefit of the sound recording copyright holder and the performing artists for the right to perform the copyrighted sound recording via non-interactive, digital means.
non-interactive digital performance royalties
The royalties owed to the creator(s) of a musical composition which are paid in return for the right to reproduce, distribute, or perform the copyrighted work.
A musical composition is one of the two copyrightable parts of a recorded song. It consists of the song's music, including any accompanying words, (i.e. the portion of a song that is capable of being fully expressed as sheet music) and is separate from any particular recording of the song or its performance by any particular artist.
A sound recording is one of the two copyrightable portions of a recorded song. It results from the fixation of a series of musical, spoken, or other sounds in a tangible (at least momentarily permanent) medium.
The portion of royalties owed to the owner of a sound recording. The owner may the performing artist, the producer, or another party (such as a record label) who contractually acquired the ownership of the copyrighted work (e.g., through a recording agreement), owns it by virtue of an employer-employee relationship with the creator(s) of the work, or specially commissioned the work.
rights owner's share
The portion of royalties owed to the performers of a sound recording in return for the right to perform the copyrighted work via non-interactive, digital services (e.g., Pandora, Spotify).
The portion of royalties owed to the music publisher which are paid in return for the right to reproduce, distribute, or perform a copyrighted musical composition, arising from a contractual obligation (i.e. a publishing agreement) or employer-employee relationship with the creator of composition (i.e. the songwriter(s)).
If an asset requires splitting up a catalog by works or percentages, Royalty Exchange may need to provide royalty accounting services to the buyer, seller, or both. This is because the royalty distributor may not be able to split royalties as intended by the asset transfer. Royalty Exchange's involvement helps to ensure accurate royalty payments. It also helps assure buyers and sellers that they are not missing out on potential earnings.
The accounting process often involves manual spreadsheet work and coordinating with royalty distributors. Royalty Exchange's goal is for the accounting service to be temporary. We plan to work with distributors to find solutions that will allow us to revert accounting and payment obligations back to the distributor, removing ourselves from the process. In the meantime, we've instituted the 5% fee to help offset costs in the manual accounting.
Please see the sample accounting agreement document for reference.
Why does Royalty Exchange need to account?
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