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HELP - Record deal.

Discussion in 'Studio Lounge' started by Voiceofallanger, Jun 6, 2014.

  1. Voiceofallanger

    Voiceofallanger Active Member

    Hi guys,

    The following is a record deal which my band has been offered. I am going to straight post it up here so that you can read it. The guy who we are dealing with seems very nice and doesn't seem like the kind of guy who would screw us. However naturally I have some concerns. I am looking for the advice of anyone who can CONFIDENTLY say they know what they are doing in this area (my life is on the line here) to clarify some details for me. The contract is as follows.

    ------------------------

    This Agreement made this 5 day of June, 2014 describes the legal relationship between BLAHBLAHNAMEOFLABEL (Hereinafter referred to as “Label”) and BLAHBLAHSECRETNAMEHERE d/b/a The Comfortable Jumpers (collectively with our licensees and assignees referred to in this Agreement as “The

    Comfortable Jumpers.”)

    1. Definitions.

    The following terms shall have the following meanings for purposes of this Agreement:

    a. “Digital Master” or “Digital Masters” means copies of The Comfortable Jumpers’s sound recordings and underlying musical compositions that The Comfortable Jumpers owns, controls, or has the appropriate rights to distribute in a digital form, which Label may sell or authorize Digital Store(s) to sell via Electronic Transmission, including but not limited to, permanent digital download, streams, “conditional download,” burns, ring tones, real tones, or other digital form as individual tracks or as a whole album, and artwork pursuant to the terms and conditions of this Agreement. Any sound recordings and the underlying musical compositions that are provided by or on behalf of The Comfortable Jumpers to Label must be owned or controlled by The Comfortable Jumpers and/or have been cleared by The Comfortable Jumpers. Any sound recording provided by The Comfortable Jumpers to Label shall be deemed subject to this agreement.

    b. “Digital Store” means any third party, including but not limited to iTunes, Sony Connect, Napster, Real Networks, Hear Music, E-Music, MusicMatch, that Label in its sole discretion may authorize to carry out the marketing, distribution and sale or other use of the Digital Masters pursuant to the terms of this Agreement.

    c. “The Effective Date of this Agreement” shall mean either the date of this agreement or the day that the first Digital Masters are received by Label from The Comfortable Jumpers, which ever is the later.

    d. “Term” means the period beginning on the Effective Date of this Agreement and ending two years after the Effective Date.

    e. “Territory” means the Universe.

    f. “Artwork” means album cover artwork and any other artwork relating to The

    Comfortable Jumpers Digital Master(s) that The Comfortable Jumpers provides to Label. Any artwork that is provided by or on behalf of The Comfortable Jumpers to Label before or during the Term will be deemed to have been cleared by The Comfortable Jumpers unless The Comfortable Jumpers promptly notifies Label in writing to the contrary.

    g. “Metadata” means the following categories of information in respect to each Digital

    Master: track title; album title; artist name; genre; copyright information; label name; ISRC and UPC identifiers; “Explicit Lyrics,” identification; biographical information; sales information- including pricing, date of first release; territories available for release; Songwriter and Publisher information.

    h. “Electronic Transmission” - means any transmission, whether sound alone, sound coupled with an image, or sound coupled with data, in any form, analog or digital, now known or later developed (including, but not limited to, “cybercasts,” “webcasts,” “streaming audio,” “streaming audio/video,” “digital downloads,” direct broadcast satellite, point-to-
    multipoint satellite, multipoint distribution service, point-to-point distribution service, cable system, telephone system, broadcast station, and any other forms of transmission now known or hereafter devised) whether or not such transmission is made on-demand or near on-demand, whether or not a direct or indirect charge is made to receive the transmission and whether or not such transmission results in a specifically identifiable reproduction by or for any transmission recipient.

    2. Rights



    Subject to the terms of this Agreement, The Comfortable Jumpers hereby appoints Label

    a. as The Comfortable Jumpers’s exclusive authorized representative for the sale and electronic transmission of its Digital Masters. Accordingly, The Comfortable Jumpers hereby grants an exclusive right to Label, during the Term, to: (i) Reproduce and convert The Comfortable Jumpers’s content delivered by The Comfortable Jumpers into Digital Masters; (ii) Perform and make thirty (30) second clips of the The Comfortable Jumpers’s content available by streaming (“Clips”) to promote the sale and distribution of applicable Digital Masters; (iii) Promote, sell, distribute, and electronically transmit and deliver Digital Masters, as individual tracks or entire albums, and associated Metadata to purchasers who may use such Digital Masters in accordance with usage rules similar to those set forth by the music services;

    (iv) Display and electronically transmit and deliver Artwork for use solely in conjunction with the applicable purchased Digital Master(s); (v) Use The Comfortable Jumpers’s Content, Artwork and Metadata as may be reasonably necessary or desirable for Label to exercise Label rights under the terms of this Agreement; and (vi) authorize or appoint any Online Store(s) to perform the activities in (i)-(v) above.

    b. The Comfortable Jumpers may use and authorize its Online Store(s) to use the names and likenesses of, and biographical material concerning and of the The Comfortable Jumpers’s artists, bands, producers and/or songwriters, as well as track and/or album name, and Artwork, in any marketing materials for the sale, promotion and advertising of the applicable Digital Master which is offered for sale or other use under the terms of this Agreement (e.g., an artist or band name and likeness may be used in an informational fashion, such as textual displays or other informational passages, to identify and represent authorship, production credits, and performances of the applicable artist or band in connection with the authorized exploitation of applicable Digital Masters). Label and any of its Online Store(s) shall have the unrestricted right to market, promote and advertise the Digital Masters available for purchase as it determines in its discretion. Nothing herein shall obligate Label or any Online Store(s) to actually exercise any rights granted under this Agreement.

    3. The Comfortable Jumpers’s Obligations.

    The Comfortable Jumpers shall obtain and pay for any necessary clearances and licenses in the Territory for all The Comfortable Jumpers Content and Artwork. Specifically, The Comfortable Jumpers shall be responsible for and timely pay (i) any royalties and other income due to artists, authors, co-authors, copyright owners, co-copyright owners, producers and other record royalty participants from sales or other uses of Digital Masters, (ii) all mechanical royalties payable to publishers and/or authors or co-authors of copyrighted musical compositions embodied in Digital Masters from sales or other uses of Digital Masters, (iii) all payments that may be required under collective bargaining agreements applicable to The Comfortable Jumpers or third parties other than Label, and (iv) any other royalties, fees and/or sums payable with respect to the The Comfortable Jumpers Content, Artwork, Metadata and other materials provided by The Comfortable Jumpers to Label. (v) The Comfortable Jumpers agrees that it shall prominently promote no less than one (1) of Label’s Online Store(s) on The Comfortable Jumpers’s own website and any artist’s website that the The Comfortable Jumpers has provided Label music for, and shall provide a link to said Online Store(s). (Eg. featured on iTunes logo.)

    4. Payment.

    Label shall pay The Comfortable Jumpers [70%] of the total revenues that Label receives from its online aggregator(s) for the sale or other use of The Comfortable Jumpers’s Digital Masters. Label will compute amounts payable to the The Comfortable Jumpers within 14 days of the end of each month during the Term, and will provide a royalty statement to The Comfortable Jumpers in accordance with Label’s standard business practices. Such payment shall constitute full consideration for all rights granted and obligations undertaken by The Comfortable Jumpers hereunder.

    5. Ownership.

    As between the Parties, all right, title and interest in and to (i) The Comfortable Jumpers’s Sound Recordings and Artwork, (ii) the Digital Masters, (iii) the Clips, (iv) all copyrights and equivalent rights embodied therein, and (v) all materials furnished by The Comfortable Jumpers, except as to any rights of Label (whether pre-existing or under this Agreement), shall remain the property of The Comfortable Jumpers, it being understood that under no circumstances shall Label have any lesser rights than it would have as a member of the public.

    6. Indemnification and Limitation of Liability.

    a. The Comfortable Jumpers will indemnify, defend and hold harmless, and upon Label’s request, defend, Label and its Online Store(s) and affiliates (and their respective directors, officers and employees) from and against any and all losses, liabilities, damages, costs or expenses (including reasonable attorneys’ fees and costs) arising out of a claim by a third party by reason of: (i) a breach of any warranty, representation, covenant or obligation by The Comfortable Jumpers under this Agreement; or (ii) any claim that any Digital Rights or other copyright infringement has been committed by The Comfortable Jumpers. Master, sound recording or The Comfortable Jumpers Content, Artwork, Metadata or any other materials provided or authorized by or on behalf of The Comfortable Jumpers
    hereunder or Label’s or its Online Store(s) use thereof violates or infringes the rights of another party. The Comfortable Jumpers will reimburse Label and its Online Store(s) and affiliates on demand for any actual payments made in resolution of any liability or claim that is subject to indemnification under this Section 6, provided that Label obtains The Comfortable Jumpers’s written consent prior to making such payments, such consent not to be unreasonably withheld, delayed or conditioned. Label shall promptly notify The Comfortable Jumpers of any such claim. The Comfortable Jumpers may assume control of the defense of such claim. Label shall have the right, to participate in the defense thereof under The Comfortable Jumpers’s direction. Pending final determination of any claim involving such alleged breach or failure, Label may withhold sums due you hereunder in an amount reasonably related to the amount of such claim. If no action is filed within one (1) year following the date on which such claim was first received by Label, Label shall release all sums withheld in connection with such claim, unless Label, in its reasonable business judgment, believes an action will be filed thereafter. Notwithstanding the foregoing, if, after such release by Label of sums withheld in connection with a particular claim, such claim is reasserted, then Label’s rights under this paragraph will apply ab initio in full force and effect. You shall have the right to participate in the defense of any action instituted on a claim for which you are responsible to indemnify Label using counsel of your choice and at your expense; however, Label shall have the right at all times to maintain control of the conduct of the defense.

    b. The Comfortable Jumpers represents and warrants that it has the full authority to act on behalf of any and all owners of any right, title and interest in and to the The Comfortable Jumpers Sound Recordings and artwork; that it has full authority to enter into this Agreement and to fully perform its obligations hereunder and has obtained all necessary third-party consents, licenses and permissions necessary to enter into and fully perform its obligations herein; that it owns or controls the necessary rights in order to make the grant of rights, licenses and permissions herein, and that the exercise of such rights, licenses and permissions by the other party hereto shall not violate or infringe the rights of any third party; that it shall not act in any manner which conflicts or interferes with any existing commitment or obligation of such party, and that no agreement previously entered into by such party will interfere with such party’s performance of its obligations under this Agreement.

    c. The warranties and indemnifications herein shall survive the termination of this agreement.

    Term

    7.

    The Effective Date of this Agreement will mark the commencing of this contract between

    a. the Label and The Comfortable Jumpers.

    b.

    The duration of this agreement holds both the Label and The Comfortable Jumpers to the obligations outlined within this agreement indefinitely.

    c.

    If The Comfortable Jumpers wishes to terminate the contract, they must request such in writing to the Label. The termination of this contract shall remain at the discretion of the Label.

    8.

    General Provisions.



    a. No Agency or Joint Venture. The parties agree and acknowledge that the relationship

    between the parties is that of independent contractors. This Agreement shall not be

    deemed to create a partnership or joint venture, and neither party is the other’s agent,

    partner, employee, or representative.

    b. Binding on Successors. This Agreement shall be binding on the assigns, heirs, executors,

    personal representatives, administrators, and successors (whether through merger,

    operation of law, or otherwise) of the parties.

    d. Notices. Any notice, approval, request, authorization, direction or other communication

    under this Agreement shall be given in writing and shall be deemed to have been

    delivered and given for all purposes: (i) on the delivery date if sent by electronic mail to

    the addresses provided to and by The Comfortable Jumpers upon registration with the

    Label, or as property updated.

    e. This writing contains the entire understanding between the parties and supercedes any

    previous agreements between the parties. During the term of this Agreement, it is

    understood and agreed that there shall be no change or modification of this Agreement

    unless reduced to writing and signed by all parties hereto. This agreement shall be

    governed by the laws of the United Kingdom, and subject to the exclusive jurisdiction of

    the courts located in the United Kingdom.

    f. Cure. If either party hereto alleges that the other has breached this agreement, they must

    notify the other party in writing of such breach and then the other party shall have a

    period of thirty (30) days to cure such breach.



    ------------------------------

    Firstly.. Does any of this ring alarm bells with you ? The section I am MOST concerned about is section 3 which places us reliable for royalty costs after being issued with a statement. I thought the label dealt with this but I am inexperienced in this area and could be wrong. I know we have to pay royalties if we cover songs (we do) but should this contractually be landed on us or the label ?

    Also. We have agreed with him that the contract will not be exclusive in terms of release. Section 2a uses the word exlusive in relation to SALES which I am completely fine with and would expect.. But as for electronic transmission. Does that blanket cover youtube for example and mean that we cannot release things for free on our own of any kind ?

    Any help would be greatly appreciated.

    - Dan, UK
     
  2. DonnyThompson

    DonnyThompson Distinguished Member

    I didn't even read it... because I'm not an attorney... nor am I the least bit qualified to form any kind of counsel in the field of entertainment law.

    And, As far as I know, none of us here are entertainment attorneys.

    You should definitely have one look at the contract. If you sign this without professional counsel, you're crazy.

    It doesn't matter how "nice" the guy is, this is a business, and he will absolutely look after his own interests first.
     
  3. RyanC

    RyanC Active Member

    I'm no lawyer either and this isn't official legal advice but an indefinite term which they unilaterally control is not something I do.

    At least there should be a way for you to buyout your freedom for a number roughly commensurate to what they have into you, advance plus a nice return, IMO. Even a 30y mortgage doesn't last ,*forever*. And also has a buyout (payoff) figure.
     
  4. DonnyThompson

    DonnyThompson Distinguished Member

    I'll say it one more time then I'm gonna shut up. Get an entertainment attorney.

    Not only will you be protected - but you may perhaps gain other things... things you hadn't thought of - like royalty rates, mechanicals, litigation shielding, protection of personal assets, etc.,
    They can alter the contract to your benefit and get you things you perhaps hadn't considered.

    I'm not kidding here, Angel. Do not rely on anyone here to help you with any measure of legal/music industry law confidence (unless there is a member who is an entertainment attorney within our roster).

    You really need to look for an attorney who is experienced in entertainment, copyright and music publishing law, to read this contract and make suggestions.

    And I'm not referring to the guy two doors down from you who does wills and probate. This is a very specialized form of law.

    The ballpark fee for basic record deal contract interpretation here in the states is around $250 - $350 ... More, if you want them to alter the contract to your advantage.

    Here's a number for you of a great entertainment attorney located in L.A. (I think she's in Glendale, actually) I've used her many times, and she's always had my back, and saved my a s s at least twice..

    Andrea Brauer
    Telephone: (323) 661-2440

    http://www.lawim.com/member-spotlight-biography/165-andrea-brauer

    She swims in the big oceans,... but that doesn't stop her from helping the little guy. She makes no distinction between one and the other. She is very nice and very personable.

    FWIW

    d/
     
  5. dvdhawk

    dvdhawk Well-Known Member


    NOT A LAWYER, but did skim through it.


    A) Discard the perceived "niceness" of the fellow you're dealing with - not saying he is/isn't a saint. It's not a relevant factor.

    B) This could be a turning point in your music career, either propelling you forward, or handcuffing you to a bad deal. At your age, two years may not seem like a long time, but these are prime years for a budding musical career. I assure you it will feel like an eternity if you're anchored to a label that is holding you back - or worse yet, just 'shelved' your project. Sometimes they will 'hitch their wagon to a rising star' and hope you do all the work, while they have the exclusive deal.

    C) If all they are going to do as your 'label' is submit your music to iTunes, etc., you can do all of that yourself. You are Mr. DIY. Do they have a valuable promotion and distribution network beyond that which justifies their 30%? A track record of success? Ins at radio stations? Anything they can actively do to promote sales? Had you ever heard of this label before? Do you know any other bands they work with, large or small?

    D) I couldn't agree more with Donny. Entertainment law is a very specialized field, and well worth seeking good advice from someone who knows the specific pitfalls to avoid. (not to rain on your parade, but there are usually more pitfalls than up-side to these things) If this is an important decision in your life, take some of that money you didn't have to spend to get to this point, (due to your natural gift for DIY recording) and pay a bona fide entertainment lawyer a couple hundred to address your concerns, and point out other things you haven't thought of yet that go unmentioned in the contract. If nothing else, you'll get your money's worth in educational value.

    E) The truth is, having marketable music AND a good relationship with a reputable entertainment lawyer is as good as any industry contact you will ever make. The good ones know what's happening behind the scenes, who's planning what, who is looking for material.

    SIDENOTE: So at this point it should go without saying, treat them like any other prime contact and leave them wanting to listen to the free CD(s) you very left them in the most gracious way possible. If you have chosen to not offer physical CDs for sale, I understand that point of view. However, I think everyone in your position should get at least a few professionally duplicated and printed in retail-ready fashion for promo purposes. The hand-scrawled, burned CD is not going to impress many people once you get to a certain level.


    First red flag for me, a contract that is only 2 pages long.


    Best of luck!! I really do hope this pans out to be something positive. (although I've heard a lot more horror stories than success stories as this sort of thing goes)
     
    DonnyAir likes this.
  6. paulears

    paulears Well-Known Member

    Obviously there are differences between the US and the UK but I'd want a specialist lawyer to look at the 70% of the income! and the separation of royalty payments. We do something similar in that we split incoming funds but the split is based on the net receipts after all the others have had their bits. Things like credit card surcharges, payments to licensing agencies etc. 70 percent of the net and the gross can be very, very different. 70/30 split is a fairly common distribution here, but if you then lose quite a bit of the 70 per cent, you could easily end up with 50/50 or worse which is to my mind not acceptable. Proper advice in your territory certainly seems worthwhile.
     
  7. DonnyThompson

    DonnyThompson Distinguished Member

    Probably not that much difference. The only difference I could really think of would be that you could get screwed by a guy with a British accent, instead of the accent of a guy from somewhere like Texas. ;)
     
  8. paulears

    paulears Well-Known Member

    I've got a mental impression now - not good!

    This topic spurred me on to do some housekeeping on a download site I run - the deal is we get 25% but with the tax, the paypal charges etc, it means that the track owner gets 60p for every pound paid by the clients - so the 75%/25% split of the gross produces 60% net. If you sell a lot of product, that's a big difference that needs quantifying in writing.
     
  9. RemyRAD

    RemyRAD Guest

    I might be an atheist but I think this is why God created entertainment attorneys? No? I mean yes.

    It's been common through recorded time (I just had to use that line) that most folks who get record contracts, all give up rights to their music. Ask Paul McCartney. What, you've never heard of Paul McCartney?

    You take a leap of faith and hope that you become famous. If you become famous? Then your entertainment attorney will have more clout. While you'll still give up the rights to your music. At least, the entertainment attorney will make sure your pizza is delivered on time to your hotel room.

    Make sure it's pepperoni. Remember it's banger gong. Get er on.
    Mx. Remy Ann David
     
  10. Voiceofallanger

    Voiceofallanger Active Member

    Hi guys sorry for the slow reply. Taken it to a lawyer and apparently this is ok. Especially with the term now being fixed at 2 years which the label suggested to ease our minds. Cool cool. Looks like I might be a signed artist as of tomorrow. Hehe. I was just wondering if any music lawyers just so happened to be knocking around on here! :) I think one of the real advantages about this deal is... The band that I'm working with.. We really aren't that bothered. I mean it'd be nice to go somewhere but we're just doing it for fun really so this might be a nice way of testing the water. Apparently if it falls over we can just change name and start again. Haha. Thank you for all the responses guys. I appreciate your advise and concern.
     

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