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Table of contents for The Record Contract
- The Record Contract; Part I: The Audition
- The Record Contract; Part II: The Callback
- The Record Contract; Part III: The Phone Call
- The Record Contract; Part IV: The Gathering
- The Record Contract; Part V: Getting To Know You
- The Record Contract; Part VI: Growing Closer
- The Record Contract; Part VII: Trouble in Paradise
- The Record Contract; Part VIII: Pressure Rising
- The Record Contract; Part IX: Decisions, Decisions
- The Record Contract; Part XI: Meanwhile
- The Record Contract; Part XII: The Studio
- The Record Contract; Part XIII: The Contract
- The Record Contract; Part XIV: Bonding
- The Record Contract; Part XV: A Response
- The Record Contract; Part XVI: Toni’s Party
- The Record Contract; Part XVII: Waiting Game
- The Record Contract; Part XVIII: The Hammer Falls
- The Record Contract; Part XIX: A Realization
- The Record Contract; Part XX: A Pinch of Insult
We had just finished our recording, and were anxiously waiting for Anthony to finish mixing it so we could hear how our album would sound.
Don’t think for a minute that it is a coincidence that the contracts arrived in an overnight envelope the day after we finished recording. I know now that the intention was to ride the wave of excitement and get us to sign the contracts without reviewing them.
I was going to write about how record contracts work, but I got discouraged trying to simplify it enough to make it interesting. Instead I’ll point you to some sites where you can get some information on how they work.
You can find detailed explanations online, this link will get you started and this link goes into much more detail.
Our contract was a cut and paste document. And by that, I mean it was literally cut and pasted together from several sources. The document was in multiple fonts and sizes, and at least one page was full of misaligned columns from shifting when being placed on the copy machine.
Our contract was a “production agreement” meaning that we weren’t being signed directly by Atlantic Records. We were being signed to a company called Trijon that was formed by Delious, Jeff, and some partner we never met.
The contract was an agreement that would effectively make Delious responsible for everything, management, production, securing the contract with Atlantic Records (or another record label if Atlantic decided to pass on us) and in exchange he wanted, well, everything.
Matt and I had already contacted a lawyer, Robin Mitchell Joyce. She was a very busy woman who up until we walked into her office swore she had seen and heard every sneaky and underhanded thing any record company had ever tried to pull. She was wrong.
We sent her the first draft of the contract and she called me almost immediately. Laughing. She asked me who put me up to this, was it one of her lawyer friends from up the street?
She got very quiet when I assured her that the contract was for real, and that we had not been playing a prank on her.
“We’ve got serious problems, then,” she said.
The contract gave Delious 50% of the points we received from the contract with Atlantic. Typically, an artist receives around 14 points from the record company. What this means is that after the record company recoups the money they advanced to the band for recording the album, they then give the artist 14% of record sales.
Here’s a simplified example:
Record company gives an artist $100,000 to record an album. The album gets released and makes $500,000. The record company takes back the 100,000 and then gives the artist 14% of the remaining $400,000, or $56,000.
The record company pays the producer 6% ($24,000), splits 20% among all the publishers and songwriters (often this is also the artist) represented on the album ($80,000), and keeps the rest ($240,000).
In our contract, Delious would be given 7 points, and the remaining 7 points would be divided among the 5 of us in the band. Using the example above, Delious would make $28,000, while each member of the band would make $5,600.
Not exactly living high on the hog, but an artist never makes money from the sales of an album, unless they have an atypical contract giving them more points, or they sell SO many albums that the dollar amounts aren’t insignificant. Michael Jackson’s highly publicized record contract in the 90’s gave him an unprecedented 25 points. Garth Brooks sold so many copies of his first two albums (with small advances) that he became quite wealthy despite only having 14 points on his original contract.
Most artists make their money from being on tour, ticket sales, and from selling merchandise like tee shirts and posters. The most successful artists are also songwriters and have their own publishing companies so they can collect part or all of the 20% designated in the contract.
Except.
Our contract gave 100% merchandising to Delious. Not only did he get to say what merchandise could be created, using whatever pictures he wanted, he would sell it and keep all the money. Matt was most concerned about this particular point. We talked about all the awful promotional items we had seen floating around… Thermoses, pillow cases, even yo-yos emblazoned with god-awful photos. I had nightmares about a fat Paul doll with that bad Ken Doll plastic hair.*
The original contract had no provisions for songwriting and publishing, though the wording of the contract allowed for all undeclared aspects of the record contract to fall under the 50% rule.
Matt and I met with Robin, our attorney, and her copy of the contract was a mess of red lines and scribbles. Every single page had at least one edit. Several pages had been crossed out with snarky comments written in the margins.
We gave her the go-ahead to send the edited contract back to Delious to start the negotiations.
* Though the possibilities of getting the Jerimy, Matt, and Paul dolls together were a bit intriguing. Could we have them made anatomically correct? How about anatomically superior?
