AGREEMENT made as of the 25th day of October, 1995  
by and between COMPUSERVE INCORPORATED with offices at 
5000 Arlington Centre Boulevard, Columbus, Ohio 43220  
("CompuServe"), of the one part, and FRANK MUSIC CORP. with  
offices at 39 West 54th Street, New York, New York 10019  
("FRANK") and THE HARRY FOX AGENCY, INC. with offices at 
711 Third Avenue, New York, New York 10017 ("HFA"), 
of the other part. 
 
This AGREEMENT is predicated upon the following  
AGREED STATE OF FACTS: 

I. FRANK has heretofore, on November 29, 1993,  
filed a class action, on behalf of itself and all others  
similarly situated, against CompuServe for copyright in-  
fringement in the United States District Court for the  
Southern District of New York (the "Court") bearing Civil  
Action No. 93 Civ. 8153 (JFK) (the "Action").

II. Annexed to and made part of this Agreement as  
Schedule "A" is a list of those music publishers who are all  
publisher-principals of HFA (who acts as their common  
licensing and collecting agent) and who, together with FRANK,  
pursuant to that Stipulation amending the pleadings in the  
Action which will be submitted to the Court for approval on  
November 7, 1995, are the putative members of the plaintiff  
class in the Action (hereinafter the "Class Plaintiffs");  
Schedule "A" also sets forth those musical compositions  
respectively owned or controlled by the Class Plaintiffs, the  
copyrights of which are alleged in the Action to be infringed  
by CompuServe (hereinafter collectively the "Class  
Compositions.")

III. Each cause of action set forth on behalf of  
the Class Plaintiffs in the Action is predicated, amongst  
other things, upon the following basic allegations:

A. Each Class Plaintiff owns or controls a valid  
and subsisting copyright in each of their respective Class  
Compositions;

B. CompuServe has wilfully infringed the Class  
Plaintiffs' copyrights in their respective Class Compositions  
by:

1. permitting and enabling its Subscribers to  
Upload recordings of the Class Compositions made by such  
Subscribers into a CompuServe Forum/Library in  
CompuServe's Information Service on-line computer  
database via computer modems and telephone line and other  
telecommunications connections, which database is made  
available by CompuServe to its Subscribers for Uploading  
and Downloading;

2. maintaining the Storage of such aforesaid  
recordings in its computer database, and

3. permitting and enabling its Subscribers to  
Download copies of such recordings so Stored in a  
CompuServe Forum/Library computer database  
all without any authority from the Class Plaintiffs or  
otherwise with respect to the Class Compositions, CompuServe  
thereby facilitating and participating in the unauthorized  
making and distribution of Phonorecords of the Class  
Compositions.

IV. In its pleadings in the Action, CompuServe has  
asserted numerous defenses to the claims therein alleged on  
behalf of the Class Plaintiffs and has denied any liability on  
its part with respect thereto.

V. Without CompuServe admitting any liability on  
its part with respect to any claims alleged in the Action and  
with neither CompuServe nor FRANK (on its own behalf or on  
behalf of the other Class Plaintiffs) withdrawing any position  
stated in their respective pleadings in the Action,  
CompuServe, FRANK and HFA respectively desire, conditioned  
upon and subject to the issuance of an order of the Court  
approving this Agreement without modification, which may be  
entered after a hearing on notice to the Class Plaintiffs (the  
"Order of Approval"):

A. in order to eliminate the continued expenses and  
burdens of, as well as the uncertainties associated with,  
the continued litigating of the Action, to provide for  
the settlement and dismissal of the Action, and

B. in order to avoid future uncertainties and the  
prospects of future litigation:

1. to provide for the mutually beneficial  
"Licensing Arrangement" (as such term is hereinafter  
defined and provided) for continued use of the Class  
Compositions and other musical compositions owned or  
controlled by the Class Plaintiffs in the making and  
distribution of Phonorecords via Uploading and  
Downloading to and from CompuServe's Forum/Library  
computer databases, 

2. to provide for the availability of the  
"Licensing Arrangement" to others of HFA's  
publisher-principals (in addition to the Class  
Plaintiffs) for the use of their musical com-  
positions in the making and distribution of  
Phonorecords via Uploading and Downloading to and  
from CompuServe's Forum/Library computer databases,  
and 

3. To provide a mechanism for CompuServe's  
Managers to obtain license authority for the use of  
the musical compositions owned by those Class  
Plaintiffs (who do not opt out) as well as other  
publisher-principals of HFA. 
 
NOW, THEREFORE, predicated upon the foregoing AGREED  
STATE OF FACTS, the parties hereto AGREE AS FOLLOWS:  

1. IT IS AGREED that upon the first business day  
after the date on which the Order of Approval becomes a final  
order (the "Effective Date"), this Agreement shall become  
fully operative in accordance with its terms, provided that  
the applicable provisions of paragraphs 2, 3, 5B, 6, 8, 9,  
ll(A) and 12-15 shall become fully operative upon the  
execution of this Agreement. 

2. The parties hereto shall, and they shall direct  
their respective attorneys in the Action to, fully cooperate  
in the submission of this Agreement to the Court and fully  
cooperate in the hearing or other proceedings required by the  
Court, as well as execute, obtain and deliver any documents  
necessary or required to secure the approval of this Agreement  
and the entry of the Order Of Approval with respect hereto.  

3. Upon entry of the Order of Approval by the  
Court, CompuServe shall pay the sum of Five Hundred, Sixty  
Eight Thousand (568,000.00) Dollars to HFA (the "Settlement  
Sum"), the receipt of which is hereby acknowledged by HFA.  
The Settlement Sum shall be allocated and upon entry of the  
Order of Approval, paid by HFA as follows:  

A. the sum of Five Hundred Dollars ($500.00) for  
each of the nine hundred forty seven (947) Class  
Compositions to the respective Class Plaintiffs who do  
not opt out in proportion to their ownership interests  
thereof as shown on Schedule "A" as and for their shares  
of the Settlement Sum hereunder, and 

B. the sum of Ninety Four Thousand, Five Hundred  
Dollars ($94,500.00) shall be retained by HFA as and for  
the sum agreed upon for partial reimbursement of the  
legal fees and expenses heretofore incurred by HFA in the  
prosecution of this Action and to be incurred in the  
resolution of the Action. 

C.  HFA shall hold the Settlement Sum in escrow  
until the Effective Date and shall thereupon make such  
payments and reimburse itself as aforesaid. In the  
event, however, that a successful appeal is taken or  
rehearing obtained by a third party with respect to the  
Order of Approval that results in its being dissolved or  
substantially modified, then and in such event, HFA shall  
either repay the Settlement Sum to CompuServe or  
otherwise conform to such modification if such  
modification is agreed to be mutually acceptable by the  
parties to this Agreement and the Action.  

4.  Upon the Effective Date, CompuServe, Managers,  
Frank, HFA and all of the Class Plaintiffs who do not opt out  
of this Action shall be bound by those express operative  
provisions of the Licensing Arrangement applicable to them  
respectively, as hereinbelow defined and provided.  
 
5. For the purposes of this Agreement, the "Licensing 
Arrangement" shall be defined, determined and provided  
as follows: 

A. Definitions for all of the purposes of this  
Agreement: 

(1) "Licensor" shall mean each Class Plaintiff  
who does not opt out of the Action; 

(2) "Licensable Songs" shall mean each 
Licensor's respective Class Composition(s) as well  
as all other musical compositions which are owned or  
controlled by such Licensor and as to which HFA has  
the authority from such Licensor to issue written  
variations of the compulsory license provisions of  
the U.S. Copyright Act, 17 U.S.C. 115, for the use  
of such compositions in the making and distribution  
of Phonorecords; 

(3) "Phonorecord," "Sound Recordings" and  
"Audiovisual Works" shall have the same meanings as  
are provided in section 101 of the U.S. Copyright  
Act, 17 U.S.C. 101; 

(4) "Manager" shall mean any manager or  
operator (including system operators or SYSOPS) of a  
CompuServe Forum/Library, provided that the term  
shall not be construed to refer to or include  
CompuServe except in the instance, if ever, that  
CompuServe is the sole manager or operator of such  
Forum/Library and shall include those persons or  
entities listed on Schedule "B" annexed to and made  
part of this Agreement. 

(5) "Forum/Library" and "CompuServe's 
Forum/Library" shall mean those portions of  
CompuServe's Information Service database which are  
identified to its Subscribers as "Forums," and to  
which recordings of Licensable Songs are Uploaded by  
Subscribers. 

(6) "CompuServe's Information Service" shall  
mean the information service(s) and related  
databases operated by CompuServe (or any of its  
subsidiaries or affiliates of which CompuServe gives  
HFA written notice) which may be accessed by a  
Subscriber by the use of a P.C. and a modem or other  
telecommunications device and through which a  
CompuServe Forum/Library may be accessed;  

(7) A "P.C." shall mean a "personal computer"  
as such term is understood in the computer industry;  

(8) "CompuServe's Computer System" shall mean  
those systems owned or controlled by CompuServe of  
digital electronic computers in all forms and those  
related to databases and systems of peripheral  
equipment linked by telecommunications or otherwise  
for the exchange of data or other information;  

(9) "Download" shall mean the making of a  
phonorecord of a musical composition by enabling  
CompuServe's Computer System to transmit a Sound  
Recording of such musical composition in the form of  
digital data, which Phonorecord was stored in a  
CompuServe Forum/Library database; 

(10) "Upload" shall mean to enable the Storage  
of a Phonorecord of a musical composition in a  
CompuServe Forum/Library database by transmitting a  
Sound Recording of such musical composition in the  
form of digital data to CompuServe's Computer  
System; 

(11) "Statutory Rate" shall mean the per  
Phonorecord statutory royalty rate in the United  
States for the compulsory license provided in 17  
U.S.C. 115, as such Statutory Rate may be adjusted  
from time to time as provided by law or regulation.  
As of the date of execution hereof, the Statutory  
Rate for each Phonorecord of a musical work is based  
upon the duration of the Phonorecord of the musical  
work and equals (a) 6.6 cents if the duration is  
five minutes or less and (_) 1.25 cents per minute  
or fraction thereof if the duration exceeds five  
minutes; 

(12) "Store" and "Storage" shall mean the  
maintenance of a Phonorecord of a musical  
composition in digital data form as an electronic  
file either on a computer system or offline media  
designated for backup, reference, or archival  
purposes, and shall include all reproduction of such  
data incidental to such maintenance; 

(13) "Preview Area" shall mean that portion of  
any Forum/Library to which a Phonorecord of a  
musical composition may be Uploaded to the  
Forum/Library and in which such Uploaded  
Phonorecords are Stored prior to such Phonorecord  
being made available for Downloading from  
CompuServe's Forum/Library; 

(14) "Mechanical License" shall mean that  
written variation of the compulsory license pro-  
visions of the U.S. Copyright Act, 17 U.S.C. 115,  
in the form annexed as Exhibit "1" (and comprised of  
both Parts I and II thereof) to be issued hereunder  
by HFA for and on behalf of its Licensors  
(publisher-principals) to a Manager as non-exclusive  
authority for the use of a licensable song in the  
making and distribution of Phonorecords thereof via  
Uploading and Downloading of a particular recording  
of such licensable song to and from a CompuServe  
Forum/Library. 

(15) "Mechanical License Request" shall mean  
that written request for a Mechanical License in the  
form annexed to and made part of this Agreement as  
Part I of Exhibit "1" which may be transmitted  
electronically to HFA by a Manager seeking a  
Mechanical License as authority for the use of a  
licensable song. 

(16) "Subscriber" shall mean a subscriber to  
CompuServe's Information Service. 

(17) The definitions hereinabove set forth  
shall apply to the applicable terms whether or not  
such terms are capitalized in this Agreement and  
shall likewise apply to all forms of the terms so  
defined (e.g. the definition of "Upload" shall  
likewise apply to "Uploaded", "Uploading",  
"Uploads", etc.). 

B. From and after the Effective Date, CompuServe  
shall require each of its Managers on Schedule "B" and  
any other Manager known to CompuServe to operate a  
Forum/Library to obtain license authority where necessary  
under the Copyright Act prior to any Downloading by a  
Subscriber of a Sound Recording of a Licensable Song from  
such Forum/Library's database in accordance with the  
provisions herein set forth. In such connection, from  
and after the date of execution hereof in the case of  
Managers on Schedule "B" and from and after the Effective  
Date in the case of other such Managers, CompuServe  
agrees that it shall require each such Manager to agree  
with it in writing to adhere to the provisions of this  
Agreement relating to Licensable Songs and shall provide  
HFA with a copy of each such writing promptly after its  
execution, or CompuServe otherwise shall take steps to  
prevent infringement of Licensable Songs by such Manager  
through Downloading from such Forum/Library.  

C. No Manager shall permit or enable the  
Downloading of a recording of a licensable song from the  
Manager's Forum/Library until a Mechanical License, where  
necessary under the Copyright Act for such Downloading is  
obtained hereunder therefor from HFA (or other authorized  
Licensor, if any) and in such connection it is agreed  
that Uploads of such recordings may be Stored in a  
Preview Area, without liability therefor, until such time  
as a Mechanical License for such recording is obtained  
from HFA. CompuServe agrees to use its reasonable best  
efforts to ensure each of its Managers complies with the  
Manager's obligations under the foregoing provisions of  
this subparagraph C. 

D. HFA shall provide for 24-hours a day access by a  
representative or designee of CompuServe to HFA's song  
file database of Licensable Songs for the purpose of  
determining the availability thereof for the issuance of  
Mechanical Licenses hereunder. Such song file database  
shall contain the song number and related information  
necessary for the accurate completion of Mechanical  
License Requests by Managers hereunder. There will be no  
charge by HFA for such access on the condition that there  
will be no charge by CompuServe to Subscribers for the  
information contained in HFA's song file database.  

E. Mechanical Licenses shall be requested and  
issued hereunder in accordance with the following  
procedures and shall be governed by the following terms  
and conditions: 

(1) Each Manager who is not a "Defaulting  
Manager" (as such term is defined in sub-paragraph  
(9) below) may obtain a Mechanical License for the  
use of a licensable song by electronically (via  
modem) transmitting an accurate and completed  
Mechanical License Request to HFA with a copy  
thereof to CompuServe utilizing therein the "PIN"  
number which HFA shall have approved and assigned  
for each Manager who shall have previously applied  
to HFA therefor in writing. "PIN" numbers shall be  
approved and assigned by HFA for each Forum/Library  
Manager as to which such a Forum/Library Manager  
request in writing is received by HFA. An  
application by a Manager for a PIN number shall be  
accompanied by a statement from an authorized  
employee of CompuServe approving such application  
and attesting to the identity of the applicant and  
the Forum/Library to which the application pertains.  
The Manager is not obligated to submit such a  
request until immediately prior to the transfer to  
the publicly-accessible areas of the Forum/Library  
of a Sound Recording of a Licensable Song.  

(2) Each Mechanical License Request shall  
request a Mechanical License for the use in con-  
junction with CompuServe and the Forum/Library of a  
licensable song at the Statutory Rate unless prior  
to its transmission HFA shall have received written  
consent from a Licensor to issue same at a lesser  
royalty rate, in which case it shall be deemed  
issued at such lesser rate. In this connection, it  
is understood and agreed that Managers are free to  
directly negotiate for and seek to obtain the  
consent from Licensors to any such lesser royalty  
rate 

(3) Upon the electronic receipt by HFA from a  
Manager (who is not a "Defaulting Manager") of an  
accurate, clearly transmitted and completed  
Mechanical License Request for a licensable song  
transmitted by such Manager with his (its) "PIN"  
number thereon, such Mechanical License (in the form  
comprised of Exhibit "1",  Parts I and II taken  
together) shall be and be deemed issued by HFA on  
behalf of the respective Licensor (HFA publisher-  
principal) and both the Licensor and such Manager  
shall be and be deemed bound in all respects by the  
provisions of such Mechanical License for such  
licensable song all in accordance with the terms and  
conditions of the Mechanical License as set forth in  
Exhibit 1, Parts I and II, and the related  
provisions of this Agreement. 

(4) Within a reasonable period after the end  
of each month during the operation of these  
Mechanical License provisions, HFA shall send to  
each Manager, who shall have obtained a Mechanical  
License pursuant to the provisions hereof during  
such month, a written summary of the Mechanical  
Licenses so obtained during such month setting forth  
therein the license numbers assigned thereto by HFA.  
Copies of such monthly summaries shall likewise be  
sent to CompuServe by HFA. 

(5) Each individual Mechanical License is  
deemed to be limited to the making and distribution  
to P.C.'s only of Phonorecord copies from one  
specific Uploaded Sound Recording that do not  
accompany an Audiovisual Work and for private use  
with no further copying being included within the  
license authority. CompuServe shall not be liable  
for the acts of Subscribers that exceed the scope of  
the Mechanical License, provided that CompuServe  
does not advertise or promote Subscriber usage  
beyond the scope of the Mechanical License.  
(6) To the extent, if any, it is an infringer  
under applicable copyright laws for any unauthorized  
use on CompuServe's Information Services of a  
musical composition covered by this Agreement,  
CompuServe shall be liable therefor and, in  
addition, any use of a licensable song for which a  
Mechanical License is revoked and terminated by  
reason of failure to pay royalties not timely cured  
after notice shall be actionable as an act of  
copyright infringement as provided in such  
Mechanical Licenses and under Section 115 of the  
U.S. Copyright Act, but nothing in this Agreement  
shall limit any rights or defenses of CompuServe or  
the Managers under the Copyright Act in any action  
based on the foregoing.

(7) HFA shall, not more than once in any  
calendar year, by its authorized representatives, on  
thirty (30) days prior notice, have access to  
CompuServe's applicable revenue and service activity  
records and such other books and records as may be  
required for the purpose of verifying the accuracy  
of the royalty statements rendered and payments made  
pursuant to the Mechanical Licenses. Such  
examinations shall be conducted during CompuServe's  
business hours at CompuServe's offices in Columbus,  
Ohio. The costs of such examinations shall be borne  
by HFA unless the amount of any revealed  
underpayment is ten (10%) percent or more of the  
sums actually paid during the period for which the  
examination is conducted. If the amount of revealed  
underpayment exceeds ten percent (10%) of such sums,  
then the cost of such examination shall be borne by  
CompuServe. Such access, however, shall be subject  
to the policies of CompuServe as to confidentiality  
concerning the identity of Subscribers and  
Subscriber information where they so require.  

(8) Royalties under such Mechanical Licenses  
shall be paid within forty-five (45) days after the  
end of each calendar quarter and shall be  
accompanied by statements (which may be provided  
electronically) showing, for each Licensor  
(publisher-principal), the license number, the title  
of each Licensable Song, the number of copies  
Downloaded for each and the royalty due thereon.  
(9) CompuServe agrees to and does hereby  
guarantee the payment of those royalties to be paid  
by its respective Managers pursuant to the  
Mechanical Licenses. Notwithstanding such guaranty  
by CompuServe, and without limiting the rights of  
HFA on behalf of the Licensors to seek payment from  
CompuServe based thereon, in the event that the  
statements and payments are not made in accordance  
with the terms of the Mechanical Licenses, then the  
affected Licensors shall have the right to terminate  
and revoke the Mechanical Licenses on thirty (30)  
days' prior written notice to the respective  
Managers with copies to CompuServe. In the event  
that such payments are not made by either the  
Managers or CompuServe within such thirty-day period  
then the Mechanical Licenses shall be automatically  
revoked and terminated and those copies for which  
payments were not made shall be actionable as acts  
of infringement and fully subject to the remedies  
provided for under the Copyright Act. 
In addition, upon the date of any such notice,  
the Manager to whom same is directed shall, for the  
purposes of this Agreement and the Licensing  
Arrangement, be and be deemed a "Defaulting Manager"  
and such Manager shall remain a Defaulting Manager  
unless and until the default in royalty payments is  
cured within the thirty day period commencing on the  
date of the notice. 

(10) All rights in the Licensable Songs not  
specifically granted in the Mechanical Licenses are  
reserved to the Licensors. 

(11) The scope of the Mechanical Licenses is  
deemed limited to Uploading, Storage and Downloading  
to and from CompuServe's Forum/Library databases  
located in the United States only, with access  
however to such Forum/Library databases for  
Uploading and Downloading permitted for Subscribers  
located anywhere in the world. 

(12) Notwithstanding anything herein or in a  
Mechanical License contained to the contrary, no  
authority to use a licensable song hereunder or  
pursuant to a Mechanical License issued hereunder  
shall be deemed granted unless the prior consent of  
the lawful owner of the Sound Recording (and the  
sounds fixed therein) containing such licensable  
song is first obtained for the making of Phonorecord  
copies thereof. 

(13) In addition to the access to be provided  
pursuant to subparagraph (7) hereof, CompuServe  
shall, without charge, provide HFA with sponsored  
account access to CompuServe's Information Service  
which shall, to the extent possible, provide for the  
tracking, identifying and verifying the uses of  
musical compositions therein and thereby. Such  
access, however, shall be subject to the policies of  
CompuServe as to confidentiality concerning the  
identity of Subscribers and Subscriber information  
where they so require. In any event, CompuServe  
shall provide HFA access to the number of Downloads  
of Licensable Songs. 

(14) Any Manager, prior to submitting any  
Mechanical License Request, must apply to HFA for  
assignment of a PIN number, which shall be unique to  
that Manager. If a Manager manages or operates more  
than one Forum/Library, and intends to use  
Licensable Songs in two or more of those  
Forum/Libraries, separate applications shall be made  
for each such Forum/Library and HFA shall assign  
unique PIN numbers for each such Forum/Library. The  
confidentiality of PIN numbers shall be strictly  
maintained by all parties. Following the initial  
assignment, HFA shall reassign a PIN number promptly  
at the request of a Manager or CompuServe, and HFA  
may reassign any PIN number at its discretion, upon  
prior notice to the affected Manager and to  
CompuServe, in each case, regardless of whether the  
PIN number has suffered a breach of confidentiality.  
An application by a Manager for a PIN number shall  
be accompanied by a statement from an authorized  
employee of CompuServe approving such application  
and attesting to the identity of the applicant and  
the Forum/Library to which the application pertains.  
Applications for PIN numbers shall be made in  
writing on forms prescribed for that purpose by HFA  
and approved by CompuServe. Upon receipt of a PIN  
number from HFA, a Manager may begin submitting  
Mechanical License Requests. If a Manager ceases to  
manage any Forum/Library for which HFA has assigned  
a PIN number, CompuServe shall promptly advise HFA  
to discontinue such PIN number. Any new Manager of  
such Forum/Library shall promptly apply for a PIN  
number in accordance with the foregoing procedure,  
and any substitute Mechanical License for one issued  
previously to the prior Manager shall, upon  
application by the new Manager, be newly issued to  
the new Manager, provided that there shall then  
exist no uncured default in the payment of royalties  
under the previously issued Mechanical License  
hereunder. 

6. CompuServe hereby warrants and represents that  
Schedule "B" annexed to and made part of this Agreement is a  
complete and accurate list of the Managers of the  
Forum/Libraries in which are located the files known to  
CompuServe as of the date hereof as embodying Sound Recordings  
of Class Compositions. The Class Plaintiffs hereby  
respectively represent and warrant that each of those  
respective Class Compositions set forth next to their re-  
spective names in Exhibit A hereto was protected by a valid  
and subsisting copyright during all times pertinent to the  
Action and so remains as of the date hereof, that Exhibit A is  
a complete and accurate list of the ownership or control of  
the copyrights or those rights that are the subject of this  
Action with respect to the Class Compositions, that all of the  
persons or entities listed in Schedule A are HFA publisher-  
principals, and that each of the Class Compositions is a work  
as to which HFA is authorized to issue written variations of  
the compulsory license provisions contained in 17 U.S.C.  
115. 

7. Upon the Effective Date, and in reliance on the  
warranty and representation of CompuServe set forth above in  
Paragraph 6, the claims set forth in the Complaint, as  
amended, in the Action for those Class Plaintiffs (who do not  
opt out of this Action) shall be deemed settled and  
compromised, and dismissed with prejudice, and such Class  
Plaintiffs shall be deemed to and shall thereupon release,  
remise and forever discharge CompuServe, its Subscribers, and,  
with respect to a Forum/Library for which they have signed a  
written agreement (as referred to in paragraph 5B above),  
those Managers identified on Schedule "B" annexed hereto, and  
their respective directors, officers, shareholders,  
representatives, agents, servants and employees of and from  
any claim, demand or cause of action now or heretofore  
existing from the beginning of time up to and inclusive of the  
date of the execution hereof with respect to any act or  
omission in connection with, or the use of, the respective  
Class Compositions owned or controlled by such Class Plain-  
tiffs as set forth on Schedule "A" annexed hereto, including,  
but not limited to, those claims and causes of action which  
are or could have been alleged or based upon any facts alleged  
in the Complaint, as amended, in the Action.  

8. Promptly after entry of the Order of Approval,  
the parties to the Action shall cause their respective counsel  
to the Action to execute and deliver to the Court, for the  
entry of an order thereon, a Stipulation of Dismissal with  
respect to the Action in the form annexed hereto as Exhibit  
"2" 

9. CompuServe, HFA and the Class Plaintiffs waive  
any rights they might otherwise have to appeal or seek  
rehearing of the Order of Approval. 

10. Promptly after the Effective Date, HFA shall  
give all of its other publisher-principals (i.e., those who  
are not Class Plaintiffs) written notice setting forth in  
substance the terms and conditions of the Licensing  
Arrangement and offer them the opportunity to become a party  
to and be bound by the Licensing Arrangement with respect to  
the musical compositions they respectively own. Each of such  
publisher-principals who agrees to be bound by the Licensing  
Arrangement shall thereupon and thereafter be a potential  
Licensor and its respective musical compositions shall  
thereupon and thereafter be deemed and become Licensable Songs  
for all purposes. 

11. Notwithstanding anything herein contained to  
the contrary: 

A. CompuServe shall have the right to avoid the  
operation of this Agreement prior to the entry of the  
Order of Approval and render it without effect by giving  
HFA and the Court written notice of its intention so to  
do in the event and upon the condition that a number of  
the Class Plaintiffs, if any, whose respective Class  
Compositions shall exceed, in the aggregate, more than  
twenty (20%) percent of the total number of Class  
Compositions set forth on Schedule "A", shall elect to  
opt out of this Action. In this connection, it is  
understood and agreed that, in any event, the Settlement  
Sum shall be reduced by the sum of $500.00 for each Class  
Composition which shall fall outside the operation of  
this Agreement by reason of the opting out of this  
Agreement by a Class Plaintiff owning or controlling  
same. 

B. CompuServe acknowledges that upon ninety (90)  
days prior notice HFA's publisher-principals (including  
the Class Plaintiffs) have the right to terminate their  
agency relationship with HFA thereby effectively ter-  
minating the operation of the Licensing Arrangement as  
applicable to the issuance of new Mechanical Licenses by  
such publisher-principals. In addition, HFA's publisher-  
principals, upon notice, shall have the right to exclude  
any or all of the musical compositions, for which they  
own or control the right to issue Mechanical Licenses,  
from the issuance of Mechanical Licenses pursuant to the  
Licensing Arrangement hereunder, but the provisions of  
this paragraph shall not affect the inclusion of the  
Class Compositions owned or controlled by those Class  
Plaintiffs who do not opt out of the Action from the  
operation of the provisions of Paragraph 7 hereinabove  
set forth. In the instances of termination and  
exclusion, the Mechanical Licenses issued hereunder prior  
thereto would nevertheless remain in full force and  
effect, provided, however, that in instances of  
termination by a publisher-principal of the agency  
relationship with HFA, the royalty payments and  
statements under such Mechanical Licenses shall be made  
thereafter directly to the terminating publisher-  
principal. 

12. Annexed hereto as Exhibit 3 is the form of a  
joint press release which is agreed upon by the parties hereto  
as the form of press release that will be issued on the date  
the Court schedules a hearing for the approval of this  
Agreement by the parties with respect to the settlement of the  
Action. 

13. All Notices required or desired to be given  
hereunder shall be in writing and transmitted via pre-paid  
certified mail, return receipt requested:  

A. To HFA: At its address first indicated above,  
directed to the attention of Edward P. Murphy, Chief  
Executive Officer; 

B. To CompuServe: At its address first indicated  
above, directed to the attention of Stephen M. Heaton,  
Secretary and General Counsel; 

C. To a Manager: As indicated in Schedule B;  

D. To Class Plaintiffs: c/o Alan L. Shulman,  
Silverman & Shulman, P.C., 136 East 57th Street, New  
York, New York 10022; 

E.  Or, in each case (A), (B), (C) and (D), at such  
other address which may be designated by notice to HFA  
and CompuServe in the manner above-provided.  

14. The parties agree that the entering into of  
this Agreement and the provisions and obligations herein shall  
not be deemed to be, or used in any way as, an admission of  
any liability or a waiver of any rights or defenses under the  
Copyright Act on the part of CompuServe, its Managers or  
Subscribers but shall be admissible to establish an unlicensed  
use of a musical composition or a breach of any obligations or  
provisions of this Agreement. 

15. This Agreement sets forth the entire un-  
derstanding of the parties with respect to the subject matter  
hereof, may not be altered or amended except in a signed  
writing and shall be governed and construed by and  
under the laws of the State of New York applicable to con-  
tracts wholly to be performed therein, without reference to  
choice-of-law rules and without reference to prior drafts of  
this Agreement. No waiver of the performance of any  
provisions hereof shall be deemed a continuing waiver of the  
performance of such provision or of any other provision  
hereof. 

IN WITNESS WHEREOF, the parties hereto have ex-  
ecuted this Agreement as of the date first above written.  

COMPUSERVE INCORPORATED 
By: /s/ Robert J. Massey 

FRANK MUSIC CORP. 
By: /s/ John L. Eastman 

THE HARRY FOX AGENCY, INC. 
By: /s/ Edward P. Murphy 
 
MECHANICAL LICENSE REOUEST 
License No.: (to be assigned by HFA) 
TO: THE HARRY FOX AGENCY, INC.
    711 THIRD AVENUE
    NEW YORK, NEW YORK 10017

The Manager referred to and whose "PIN" number appears below 
hereby requests license authority to use the song as referred
to below upon the terms and conditions provided in the compulsory
license provisions of the U.S. Copyright Act [17 U.S.C. Section 115]
as varied by the mechanical license provisions provided pursuant
to that certain License Arrangement set forth in and provided in
the Agreement dated October 25, 1995 to which you and
CompuServe, Incorporated are parties.  

A.  Song Code Number 
Song Title 
Songwriter(s) 
Percentages 

B.  Publisher(s) [Licensor(s)] 
 
C.  On-line Service Provider: CompuServe Incorporated 
Forum/Library's Forum Name: 
Manager (Licensee) Manager "PIN" Number:  

D.  Recording Identification: 
Playing Time: 
Royalty Rate: Statutory 
Date of Request: 

E.  Additional Provisions: 

1.  This license is solely for use of the licensed song hereunder 
in connection with the Forum/Library identified above and limited 
to access to such Forum/Library through CompuServe.

2.  The authority hereunder embraces the making and distribution 
of phonorecords via the transmission of digital data.   

MECHANICAL LICENSE PROVISIONS 

TO MANAGER: 
You have advised us, in our capacity as Agent for the Publisher(s) 
[Licensor(s)] referred to in (B) of your Mechanical License 
Request ("MLR") that you wish to obtain a compulsory license to 
make and distribute phonorecords of the copyrighted licensable 
song referred to in MLR(A) by enabling the downloading of sound 
recording copies thereof identified MLR(D) from the Forum/Library 
identified in MLR(C) under the compulsory license provisions of 
Section 115 of the U.S. Copyright Act.  Upon your doing so, you 
shall have all the rights which are granted to, and all the 
obligations which are imposed upon, users of copyrighted works 
under the compulsory license provision of the Copyright Act, 
after phonorecords of the copyrighted work have been distributed 
to the public in the United States under the authority of the 
copyright owner by another person, except that with respect to 
phonorecords thereof made and distributed hereunder:

1. You shall pay royalties and account to us as Agent for and on
behalf of said Publisher(s) quarterly, within forty-five days after
the end of each calendar quarter, on the basis of the royalty rate
provided in MLR(D) for each download;

2. For such phonorecords made and distributed, the royalty rate shall
be the statutory rate in effect at the time the phonorecords are made,
(i.e downloaded), except as otherwise stated in MLR(D);

3. The compulsory license covers and is limited to one particular
recording of said copyrighted work as identified in MLR(D) and this
compulsory license does not supersede nor in any way affect any prior
agreements now in effect respecting phonorecords of said copyrighted
work;

4. In the event you fail to account to us and pay royalties as herein
provided for, said Publisher(s) or his Agent may give written notice
to you that, unless the default is remedied within 30 days from the
date of the notice, this compulsory license will be automatically
terminated. Such termination shall render either the making or the
distribution, or both, or all phonorecords for which royalties have
not been Paid. actionable as act of infringement under, and fully
subject to the remedies provided by, the Copyright Act; 

5. You need not serve or file the notice of intention to obtain
compulsory license required by the Copyright Act; 

6. Additional provisions are reproduced under MLR(E). THE HARRY FOX
AGENCY INC.
 
FOR IMMEDIATE RELEASE 
Contact: Alan Shulman, Counsel for NMPA - 212/758-2020 Russ 
Robinson, Comm. 
Dir., CompuServe 614/457-8600  
 
SETTLEMENT REACHED IN MUSIC PUBLISHERS' CLASS ACTION  
 
NEW YORK, NEW YORK           [November 7,] 1995:  
 
Edward P. Murphy, President and Chief Executive Officer of the 
National Music Publishers' Association and The Harry Fox Agency, 
Inc., and Robert J. Massey, President and Chief Executive Officer of 
CompuServe Incorporated jointly announced today that an agreed 
upon settlement had been reached in the pending class action for 
copyright infringement against the on-line computer information 
service provider. Since its filing in November, 1993, the litigation has 
been one of the most closely watched copyright actions in the nation.  
The suit, Frank Music Corp., et al. v. CompuServe. Inc., was brought 
in the United States District Court in Manhattan by Frank Music 
Corp., and has been supported by the Harry Fox Agency, Inc. (HFA), a 
mechanical rights licensing agency for music publishers. The 
suit alleged that the copyrights in the song "UNCHAINED MELODY" 
and more than 900 additional songs owned by other music publisher-
principals of HFA were infringed, and that CompuServe was 
responsible for the alleged infringement. As alleged in the 
complaint, the claims were based upon the copying of such songs in 
the uploading and downloading of sound recordings to and from 
CompuServe's databases by subscribers to the CompuServe 
Information Service (CIS), and the alleged facilitation of this copying 
by CompuServe.

The Settlement Agreement has been submitted for court approval to 
U.S. District Judge John F. Keenan who has scheduled a hearing for 
such purpose on [December 19,] 1995. As required in this type of class 
action, each publisher member of the plaintiff class will 
be given notice of the terms of the Agreement and an opportunity to 
opt out of its operation prior to the hearing.  
In settling the dispute, CompuServe has made no admission of 
liability, and the parties have reserved all of their rights and defenses 
under the copyright laws. As part of the overall settlement, 
CompuServe will make a payment to HFA, which will be divided 
(after deduction of litigation expenses) among the music publishers 
whose songs were involved in the case. CompuServe and HFA will 
work together to make it possible for the managers of a number of 
interest areas and forums on CIS to take licenses from HFA that 
permit the future uploading and downloading of recordings of the 
publishers' songs. The licensing arrangement - a key part of the 
settlement for all of the parties - will provide express authority to 
managers for the use of the publishers' songs in the making and 
distribution of audio recordings on the CompuServe system, thus 
insuring against claims of copyright infringement for such uses. The 
licensing arrangement is also important for music publishers, since it 
will make available to them yet another organized means of 
licensing, and collecting royalties for, the use of their musical 
compositions.

Under the terms of the settlement agreement and licensing 
arrangement, the managers shall obtain licenses prior to any 
downloading by subscribers from CIS of musical 
compositions owned or controlled by HFA's publisher-principals 
unless the uses involved are otherwise exempted under applicable 
copyright law. HFA will issue licenses electronically, provided the 
song's copyright is owned or controlled by one of the Agency's 
publisher-principals. This licensing arrangement will be available not 
only to the owners of the songs directly involved in the lawsuit, but to 
all of HFA's other publisher-principals, as well. The licenses issued 
will be variations of the compulsory licensing provisions with respect 
to phonorecords set forth in Section 115 of the U.S. Copyright Act. 
HFA will also collect royalties under the license, distribute the 
royalties to publishers, and audit payments as necessary to validate 
accuracy.

Both Mr. Murphy and Mr. Massey mutually expressed their 
appreciation for each other's dedicated efforts in attaining settlement of 
the nearly two year old litigation.