What are Royalty Rates?

"Royalty Rates" (also referred to as "Share Rates") define the percentage of a revenue amount that is contractually allocated between the Organization and one or more third parties.

Royalty Rates quantify how much each party earns within the structural framework defined by Royalty Splits. A Royalty Rate never exists on its own and is always applied to a specific Split Type defined by a Contract.

In Reprtoir, Royalty Rates are the numerical component of royalty accounting. They transform contractual rights into measurable financial outcomes.

Relationship between Royalty Splits and Royalty Rates

Royalty Rates operate strictly within the structure defined by Royalty Splits.

• Royalty Splits define which categories of revenue are concerned.
• Royalty Rates define the percentage applied within those categories.

A Split Type can exist without a Rate, but a Rate can never exist without a Split Type.

In practical terms: "Royalty Splits decide where money flows. Royalty Rates decide how much flows to each party."

Royalty Rate Types

Reprtoir supports two distinct types of Royalty Rates.

Base Rate

The "Base Rate" is the percentage defined directly in a Money Out Contract.

It represents the contractual share granted to a Rights Holder or retained by the Organization for a given Split Type.

Base Rates:

• are defined at the Contract level
• apply consistently across all Assets linked to the Contract
• reflect the legal agreement between the parties

Adjustment Rate

The "Adjustment Rate" modifies how a Base Rate is applied in a specific context.

Adjustment Rates:

• are applied at the Asset level
• do not change the Contract itself
• multiply the Base Rate to produce a final effective rate

Adjustment Rates are typically used to model contractual clauses such as:

• featured artist reductions
• territory specific variations
• special release conditions
• temporary rate modifications

An Adjustment Rate of "100%" leaves the Base Rate unchanged. An Adjustment Rate of "50%" halves the Base Rate.

How Royalty Rates are Applied

The calculation logic follows a strict sequence.

1. An Income generates one or more Royalty Splits.
2. Each Split calls the Base Rates defined in the applicable Contracts.
3. Adjustment Rates are applied where relevant.
4. The system computes the Effective Rate.
5. Accounting Operations are generated based on the Effective Rate.

Rates are always calculated deterministically and remain fully auditable.

Multi-Contract Scenarios

Multiple Contracts can apply to the same Asset and the same Royalty Split.

In this case:

• each Contract contributes its own Base Rate
• Base Rates are applied independently
• the Organization share is automatically reduced as additional Rights Holders are added

Reprtoir guarantees that the total distribution always resolves to 100% of the applicable calculation base.

Practical Example

An Organization named "Git Music" has two Contracts linked to the same Track.

Without Adjustment Rates, the effective distribution is:

If Contract A includes a clause reducing the rate by 50% for specific Assets, an Adjustment Rate of "50%" is applied:

The Contract remains unchanged. Only the Asset level calculation is affected.

Key Principles

Royalty Rates follow strict rules in Reprtoir:

• Rates are always percentages.
• Rates are always applied within a Split Type.
• Rates are always derived from Contracts.
• Adjustment Rates never alter Contracts.
• Effective Rates are always reproducible and auditable.

Understanding Royalty Rates is essential to correctly interpreting royalty calculations, balances, and statements.