Bankrupt record label TVT Records has entered an agreement to sell its music catalog and assets to The Orchard, a New York-based digital music distributor. The Orchard will acquire TVT's catalog of recordings, artist contracts, and physical distribution business. TVT's music publishing arm is not part of the deal and will continue to operate separately. The Orchard plans to make new music from TVT artists available digitally but does not intend to sign new artists or operate as a traditional record label. The sale is pending court approval.

1. BANKRUPT TVT RECORDS
FINDS NEW LIFE IN THE
ORCHARD
By BRIAN GARRITY
June 19, 2008 --
Bankrupt independent label TVT Records, home to rappers Pitbull and Lil
Jon, has entered into an agreement to sell its recorded music arm and
other assets to The Orchard, a New York-based distributor of digital music.
Financial terms of the deal were not available at press time.
The companies are aiming to close the proposed pact on July 3, pending
court approval.
As part of its winning bid, The Orchard will acquire the TVT catalog, its
artists contacts and TVT's physical distribution business. The Orchard is a
unit of Dimensional Associates, which also owns digital music retailer
eMusic.
TVT's music publishing arm, TVT Music Enterprises, home to hip-hop
producer Scott Storch and others, is not part of the deal. It will operate as a
standalone entity following the sale.
No decisions have been made yet regarding whether TVT founder Steve
Gottlieb will have any involvement with The Orchard or the TVT catalog
after the deal.
Greg Scholl, president of The Orchard, said the company - which controls
digital distribution rights to more than 1.1 million songs and makes them
available to retailers like iTunes, Verizon and others - plans to release new
music from TVT acts.
But he cautioned it isn't looking to use the deal to transform The Orchard
into a traditional record label.
"We are committed to supporting the artists on the current roster," he said.
"But we are not anticipating expanding the roster and signing new artists."

2. The Orchard already has direct deals with independent acts like Simply
Red and The Ravonettes to make sure their music is represented in
download stores.
However, the company first will have to make peace with disgruntled acts
like Pitbull.
TVT was forced to file for bankruptcy after losing a $4.45 million judgment
in a fight with Miami-based rival Slip-N-slide records over the right to
distribute a CD by the rapper.
Pitbull, who has seen sales of his CDs decline over the years, has been
seeking free agency after complaining that Gottlieb and TVT were reluctant
to allow him to appear on other artists' CDs.
TVT, one of the largest independent record labels in the country, was
started by Gottlieb in his Manhattan apartment in 1985 and grew rapidly as
Gottlieb was able to identify and sign talent that other labels stayed away
from.
The label had been financed by D.B. Zwirn pre- and post-Chapter 11
directly and through its publishing unit - which is profitable and not in
Chapter 11.