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artist were not sufficient to pay the costs. So that the artist can break even, the label would pay the difference so that the artist can pay the tour expenses. 3. Tour Production Costs. If you don’t have a label or if a label isn’t paying tour support, you would want to exclude costs associated with a tour. These might include per diems for band and crew, side musicians, equipment costs (i.e., transportation, instrument rental, etc.), sound and light expenses and monies paid to opening acts. Although most managers will agree to exclude sound and lights, you may have a more difficult time getting the manager to exclude the other costs. 4. Video Product Costs. These are the costs paid by a label for the production of your videos. 5. Agency Fees. This is often difficult to exclude. One could make a good argument that the manager benefits from the booking agent’s services, and therefore, should share in the expense. 6. Low Dollar Gigs. This would preclude a manager from commissioning gigs or other engagements below a certain dollar amount (the so-called “bread and butter” clause). Again, most artists starting out will not be getting good fees until they have established a tour history and attendance at their shows. Please note that if a manager disagrees with the insertion of this provision but agrees to defer his/her commissions, this does not mean that the manager won’t commission this money. Rather,

of the day it all comes down to your negotiation power and who is in the best position to assert his/her will. Here is an example of a post-term commission, which shows you how complex these provisions can become given the money at stake: “Notwithstanding the foregoing, the Commission after the Term shall continue to be payable to Manager only as follows: (i) with respect to recordings initially recorded or released during the Term, the Commission shall continue to be payable for a period of ___________ (___) years; and thereafter shall be payable at a rate equal to _____ percent (___ %) in perpetuity; (ii) with respect to musical compositions embodied on recordings initially recorded or released during the Term, the Commission shall continue to be payable for a further period of ___________ (___) years, and thereafter shall be payable at a rate equal to ____________ percent (____ %) in perpetuity; (iii) with respect to live engagement agreements entered into or substantially negotiated during the Term, the full Commission shall be paid regardless of when the performance occurs; (iv) except as specifically set forth in subparagraphs (i) through (iii) above, Manager shall not be entitled to any Commissions after the Term other than with respect to Gross Monies earned during the Term and received by Artist or on Artist’s behalf after the Term.”

Simply put, the personal manager is perhaps the single most important person in Your Professional life.
the manager won’t commission it until a time in the future when you are earning good money; he or she will commission the money at that time. You should be aware of such a provision as it may wreak havoc on future income. Post-Term Commissions How long is the manager entitled to receive these commissions? In particular, does the manager get paid after he/she no longer manages the artist? The answer to this question depends upon how the manager’s post-term commissions are negotiated. In general, the post-term commission sets forth the manager’s right to continue to commission monies you earn after the management agreement expires or terminates. You will want to limit the period of time in which these post-term commissions can be collected, as it’s likely at such a time you’ll also have a new manager who’ll also be expecting to be paid. In an ideal world, it would be in your best interest to limit the manager’s right to commission only the monies generated by the songs recorded and released during the term while the management agreement is in effect. This will be very difficult to get, and arguably unfair as the manager should enjoy the fruits of his/her labor performed while he/she was working for you. For example, if your manager successfully negotiated a record deal for you during the term of your management agreement but, for one reason or another, was not your manager when the album or albums under that record deal were commercially released, he/she would not be entitled to receive any of the monies generated by the songs or the masters on these albums—albums that would not have been recorded and released without his/her hard work getting you that deal. That being said, you shouldn’t be obligated to pay your former manager for albums released years ago when he/she is no longer involved in the management of your career. At the end
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Key Person Clause If you are signed to a management company, you may have a particular relationship with a particular manager, despite the fact you are signed to a management company. In the music industry, as in any business, it is not uncommon for people to switch employers during the course of their career. If your “person” were to leave the company for new opportunities or “greener pastures” you may find yourself stuck with a complete stranger. So as to prevent this from occurring, you’ll want to include a key person clause in your management agreement. This provision should state that the person who is working with you (i.e., the “key person”) must personally act as your manager. If not, you can terminate the management agreement and leave the company without any liability to the company for having done so. In order to fully protect yourself, the provision should permit you to leave upon reasonable notice, should the key person die, become disabled, or leave the company. Todd Gascon (gascon@recordingmag.com) is a technology and entertainment attorney at ZentLaw in Sunnyvale, California. Mr. Gascon’s practice is focused in the areas of intellectual property law, including copyrights and trademarks, with a particular emphasis on digital media, music, motion pictures, visual arts and all entertainment issues relative to the Internet. For more information on Todd and ZentLaw, visit www.zentlaw.com. Bruce Kaphan (kaphan@recordingmag.com) is a producer/engineer/musician/composer who currently lives in the San Francisco Bay Area. For a discography and more information on Bruce, visit www.brucekaphan.com.

http://www.zentlaw.com http://www.brucekaphan.com

Recording - February 2011

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