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MEETINGS INDUSTRY

EXHIBIT 2

Music Licensing Task Force

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The Music Licensing Task Force and BMI have developed a new Music Performance Agreement specifically for the meetings, conventions, trade shows and expositions industry.

The Music Licensing Task Force, comprised of representatives of the American Society of Association Executives, Meeting Planners International, the Professional Convention Managers Association and Religious Conference Management Association, recommend that their memberships consider the voluntary agreement as their most efficient means of complying with the copyright laws which govern the performance of music at meetings, trade shows, conventions and expositions.

The U.S. Copyright Law requires that permission be obtained before copyrighted musical works can be publicly performed. BMI, specifically recognized by the U.S. Copyright Law, collects license fees from organizations and businesses for the music played at meetings, conventions, trade shows and expositions.

We are pleased that the Agreement between BMI and the Task Force provides that no fees are required by BMI until October 1, 1990. A copy of the Agreement is enclosed.

We urge you to review the enclosed material and encourage you to obtain the appropriate license, comply with the reporting requirements and pay the applicable fees. We emphasize that the agreement is a form agreement which the Task Force believes includes terms which are reasonable and are tailored to the convention and meeting industry, but which are not binding on any group until it individually contracts with BMI.

Thank you for your attention. BMI provides a toll-free number to assist you with any questions: 1-800-669-4264.

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3. What are the legal reasons we have to pay for licensed attendees attending or registered for a performance of music?

The United States Copyright Law gives the owner of music copyrights the right to be paid for public performance of that music.

4. How do you find out if a song is copyrighted?

You may write to BMI (Broadcast Music Incorporated) or ASCAP (the American Society of Composers, Authors, and Publishers) to find out if they license a particular song. BMI's address is 320 W. 57th St., New York, NY 10019. ASCAP's address is Lincoln Plaza, New York, NY 10023.

Or you may write to the Library of Congress to find out if a song is copyrighted or if the music is free (ie., if the song(s) is considered in the "public domain."). You may get this information by doing research at the Library of Congress in Washington, D.C., or by directing your request in writing to the Library of Congress, Copyright Office, Attn: Reference Center, Washington, DC 20559. The Library of Congress charges $10 an hour for any research it

conducts.

5. What are BMI and ASCAP? What is the nature of the model agreements they have negotiated?

BMI and ASCAP protect the rights of their members (authors, composers, and publishers of music) by licensing users, collecting a fee, and distributing approximately 80-85 percent of the fee to copyright owners.

Under the new agreements, BMI and ASCAP are collecting royalties on behalf of copyright owners. Associations, in turn, pay a fee—or royalty-for the use of live or recorded music contained in either BMI's or ASCAP's repertory. Thus, when an association signs one or both of the new agreements, it will be agreeing to pay royalties,

music, not on your admission or registration costs. Use of live or recorded music at any event-meeting, trade show, convention, and so forth-qualifies as a public perfor mance of music and therefore requires payment of a royalty to the copyright owners.

8. Is there a minimum cutoff below which a meeting-say with fewer than 10 people-does not require a license?

No, both BMI and ASCAP charge a per attendee fee, with no minimum number of attendees. BMI's minimum fee for 1990 is $20 for 150 or fewer, ASCAP's minimum fee for 1991 and 1992 is $25 for 250 people or fewer.

As a practical matter, a small enough gathering might escape anybody's attention. However, there is both the ethical issue to consider and the fact that both BMI and ASCAP have "music police"-employees who travel the country looking for commercial establishments playing music without licenses. They have been known to visit some very small establishments—small pizza parlors playing a single radio to patrons, for example-and demand licenses from the owners.

9. Does one license cover an association if it plays live and/or recorded music at several different events within one meeting?

Yes, only one license is needed. Fees for music depend on the number of attendees at each event and whether live or recorded music, or both, are performed. For recorded music, the number of attendees-essentially, all in attendance except those working to put on the eventdetermines the fee, with each organization charging an amount to be multiplied by the number of attendees. For live music, each agreement contains a fee schedule, (Continued on page 3)

Clearing Up the Confusion

...Questions and Answers About Music Licensing

(Continued from page 2)

which sets fees according to a scale based on the number of people attending the specific event or function at which the live music is performed. For example, under BMI's agreement, the fee for a 1990 function at which live music is performed is $25 if 200 people attend and $125 if 1,000

attend.

Because these are "blanket" agreements permitting the performance of the entire repertory of each organization, the attendance and the method of performance (live or recorded) and not the selection of music-determine the royalty fees.

The model agreements, therefore, eliminate concerns about the need to monitor and keep a record of every song played, who owned the copyright, and so forth. The only data that must be reported to the licensing organization is whether music was performed, whether it was live or recorded, and how many people were in attendance when the music was performed. Based on that information, the BMI and ASCAP fee schedules will tell you how much money you owe.

10. For some organizations, using music at meetings is the exception rather than the rule. What if an association uses music at an event one year, then reverts to its "no music" pattern in succeeding years. Does the association need a license for the year It uses music? And what happens when the association goes back to its old pattern of not playing music?

With the ASCAP license, there is a minimum fee of $50 per event at which any music is performed. However, if no music is performed at any event, no fee is owed. Thus you can sign that agreement and if you revert to old ways owe nothing. BMI, on the other hand, has an annual minimum of $125 for 1990, climbing to $150 for 1991 and 1992, and $175 for 1993. You pay this for the first event of the year at which music is performed. If this amount is more than the license fee owed for that event, the association gets a credit against subsequent events that year.

11. If you hold one or two dinner dances or a couple of small events with live music, can you build into a contract that it is the performers' responsibility to secure a license with BMI and ASCAP?

No, BMI and ASCAP will not license performers. You can contract with someone else involved in the event to pay the amount of the required royalty fees, but as the organizer and producer of the event at which copyrighted music is performed, you are responsible for payment of the royalty

fees to the owners of the copyright, generally BMI and ASCAP.

12. How do multiple-year contracts work?

The model agreements are for three plus years for BMI and for four years for ASCAP. BMI's contract began in October 1990 and extends to Dec. 31, 1993; ASCAP's contract begins on Jan. 1, 1991, and extends to Dec. 31, 1994. They provide for automatic renewal for additional one-year terms, unless otherwise terminated.

13. What If you have allied groups that you don't control that meet concurrently at your meeting? Are you responsible for the music played at their events?

You are only responsible if the event is sanctioned or approved by your organization. If you have put your seal of approval on that event, then you are responsible. We suggest associations require allied groups to sign their own licensing agreements and to indemnify the association should there be a claim for additional royalties because of the allied group's performance of music.

14. Are you going to be at the maximum fee level on both groups if you have a large trade show?

Each organization's agreement contains a maximum fee for both live and recorded music performed at an entire event up to 14 days long and a daily maximum fee for live music performed at the event or related functions. Thus, for an event that has more than 10,000 in attendance, the maximum daily live music fee for the first contract year is $500 for both BMI and ASCAP. During the first year under both agreements, the maximum fee for all music for a single event of 14 days or less is $4,000 for the first year. And remember, the fee is based on the attendees at the event at which music is played, so if live music is used for a reception in connection with the trade show at which only a fraction of the 10,000 is in attendance, then your fee is based on the fraction and not on the 10,000.

15. If your exhibitors are playing music or have live music in their booths, are you responsible for their music licensing fee? is the count then to include all 6,000 people who pass through the trade show?

Yes, you are responsible in both instances. However, be sure to ask exhibitors if they already have licenses or if their music is original. If exhibitors have original music for which they own the copyright, no licensing fee would be required. If they don't have a license and their music is not (Continued on page 6)

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To determine the recorded music per event fee, multiply the applicable fee rate by the number of attendees.

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To determine the recorded music per event fee, multiply the applicable fee rate by the number of attendees.

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*The license fees for 1993-1994 shall be the license fees for 1992, adjusted in accordance with any increase in the national Consumer Price Index between October 1989 and the October preceding the calendar year in question. Adjustments to license fees shall be rounded to the nearest 1/2 cent for mechanical music, to the nearest $5 for live music, to the nearest $10 for the minimum fee payable, and to the nearest $50 for the maximum fee payable.

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