Music Business - Contracts

I don’t know about you, but I do know that I can’t stand the mundane task of making sure I have all my music business paperwork in order. I am taking about the contracts that any artist, band, or record label needs to create, sign, and store just in case things do not go as planned. First, creating contracts can really cause issues among the band, group, or artists. It’s pretty easy when everyone is just talking, and saying what they agree to, but once the ink is on a piece of paper and you can clearly see what is what, and what everyone has agreed to, it just seems like everyone starts to get a little crazy. Second, If you are like me, you want to believe the best of anyone you decide to share your passion of music with, leading you to ask; “why would I need contracts if everyone has agreed on what is what?” You do, trust me, money changes everyone... EVERYONE!

I have put together a list of the music business contracts that are really needed no matter if you are a solo artist, group, musician, or the record label trying to find your way through today’s music business world. Most of these music business contracts can be drawn up on a cocktail napkin between group members and artist or label and still hold up in court if, and when, needed. I wouldn’t suggest it, but what I am trying to say is that nothing fancy is needed. A music business contract is nothing more than an agreement between all the parties involved with a signature from each stating they agree to all terms contained on the napkin, or piece of paper, that the terms are written on.

I probably have to say for some sort of legal reasons, it is best to have a qualified attorney draw up or look at any contract you sign. But in reality, the reality that most artists, groups, and independent record labels live with very little money to pay attorneys, any signed agreement written up between two or more people is a legally binding contract and will hold up in court. Do not try to get all “legal-ez” on one another unless you are a law student moonlighting as an artist. I have seen some pretty crazy “home made” contracts that are almost impossible to read because the artist got online and started looking up law terms and thought it was best to stick them repeatedly throughout the contract even though he had no idea what they really meant...

 “Hereto, whereas, therefore said artists concurs in arbitration betwixt mutual consenting dwellers inscribe inward of this instrument.”

...it is much easier to simply say; “By signing this contract, all artists agree to the terms and conditions stated.” Trust me, if you are unfortunate enough to actually have to go to court over a disagreement, you do not want to present anything that reads like the above sentence to a judge. He or she will roll their eyes and start thinking their time is being wasted on a bunch of “musicians!”

On the topic of actually going to court, I want to say for the record, it is much better to sit down and communicate, no matter how hard you THINK it may be, to avoid dragging yourself, your friends, and the business of your music through court for the entire world to see just how silly you have let an argument become! Communication is everything in the music business. It is how you market your music, gain fans, get gigs, obtain radio play, create awareness, and most importantly, communication is how you keep your music business machine moving forward with everyone involved happy, healthy, and on the same path no matter what disagreements, hurt feelings, or down right fights you may have. No matter what you do in the music business, you will find that you will not always agree, especially when it is between passionate, emotional, and often times temperamental musicians or artists. The best path to communication is to have your music business contracts in order so everyone knows the who, what, where, and why of the business at hand.

Here is a list of the most important music business contracts you will need:

Band or Group Agreement
This agreement simply states who the members are, who makes the final decisions, who owns the equipment or other items, how the money will be divided, and in the unfortunate event that a band or group member decides to leave how things will be divided. It does not need to be fancy. Sit down with the members of your band or group and discuss these issues. Once you come to an agreement write it on a piece of paper and have all members sign that they agree to the terms written.

Song Writer or Publishing Agreement
This agreement states who has written and therefor owns the songs. I highly suggest if you are a band or group and everyone contributes when coming up with a new song that you divide the ownership equally between every member. If, however, the singer and guitarist write the songs and present them to the rest of the band then maybe they need to split the ownership of the songs. But even in this situation, it might not be a bad ideas to at least give the other member a small percentage of ownership to keep everyone happy. I know of one group that that always gives 20% ownership, to split equally, to any members that did not actually write the song. Let’s face it, you might have written the song, but your band or group mates will contribute while you are working out the final version. It just seems fair.

Recording Contract
I have seen a lot of artists and independent record labels conduction business without a contract in place because they everyone involved had been friends since the third grade. This is a huge mistake. Record labels destroy friendships fast! Do not conduct one single bit of business with an independent record label or artist, including “just recording a song or two” before sitting down and discussing everything upfront about the recording deal being offered or agreed to. Then, once an agreement is made, create a contract that states everything agreed to and have everyone involved sing it! Recording contracts are usually long, drawn out, and full of legal terms that even the best attorneys struggle with trying to decode the true meaning behind the words. This is because the company presenting the contract is usually trying to “get over” on the artist or group they are presenting it to. A recording contract does not need to be that had at all. In fact, they can be very simple. Your recording contract needs to state who is being signed, what is expected of them, how long the contract is for, how the money will be split, who is paying for what, and if the artist has to pay the money back how will it be handled. Yes, you can go deeper and start looking at selling a CD over seas - vs- selling the same CD in the US and how the money will be split differently or how licensing will be handles, etc, etc, etc. That is all well and good, but in reality, if you keep your contract to the previously stated terms all that is covered in the splits. Just make sure you have it in writing and by all means, do not sign anything that gives anyone control of your music forever!

Management Agreement
If you or your group uses a manager, make sure you have a written agreement of what, when, where, how, why, and for how much they will charge you for their services. This is very important. The only way you can make sure you are getting what you are paying for is to have it in writing and all the details spelled out. This agreement needs to be more than “Joe Blow will be our manager for 20% of everything.” Try to describe, in detail what it is you expect and what it is the manager expects in return for his or her services.

Booking Agent Agreement
This agreement is just like the manager agreement. Spell out what it is you expect, how much you are willing to pay, and what the booking agent expects in return. Be sure to include agreements about gigs booked soley by the band, meaning do you have to pay the agent for gigs you book, and gigs that are repeat gigs booked by the group or agent and how that money shall be split.

Music Producer or Beat Maker Agreement
If you are a solo artist, rapper, or a group that will be buying tracks from an outside producer or beat maker you have to have a signed agreement stating what you are buying, how much you are paying, whether or not you own the music outright or are only leasing the music, how the publishing money will be split between artist(s) and producer/beat maker, exclusivity (only you will have access to record with the music or will the producer/beat maker lease/sale to other artists), and expected credits to be given to the producer/beat maker. This is an important agreement if your intentions are to eventually sign to a record label. No record label will accept and song from you that does not have the proper paperwork (contract) stating ownership.

These are the core music business contracts you need to have in place before taking any action with anyone. There will be more that come up over time, but if you have these contracts agreed to, you will be able to enter into other contracts with ease as these are the fundamental contracts that spell out all the business matters between you, the label, and other band/group members. Again, these agreements do not need to be fancy or full off legal words. Simply state what you are doing, who is doing it, what is expected from each person involved, how the money will be split, and who owns what. Make sure you date and sign each agreement.

For those of you who just do not want to deal with writing your own agreements, there are prewritten music business contracts readily available online for under $20. I I have worked with and found one in particular to be helpful throughout my career as a musician, artist, and independent record label owner.  

www.Music-Business-Contracts.com

Good luck, communicate, and get your paperwork in order!

Peace,
Jai
“Love the Music in Yourself, Not Yourself in the Music!”
©2009 Jai Hutcherson. All Rights Reserved.