Lee Rudnicki - Entertainment Lawyer
The management agreement is one of the most important documents that an artist will ever sign. This article (below) has been published in magazines and digital forums.
Management Contracts 101
(c) Lee Rudnicki, Esq. 2004
DISCLAIMER: Neither transmission nor receipt of this information shall create an attorney-client relationship. The following information is general, is not legal advice or a solicitation therefore, is not a substitute for legal advice, and should not be acted on without obtaining advice from a lawyer.
Still here? Okay, here we go.
You can read a ton of material on what clauses, percentages and legal language to look out for in a management contract, but most artists I work with in my capacity as an attorney have their eyes so glued on the contract they forget to ask the manager the most fundamental questions of all -- the ones that can make ANY contract not worth the paper it is printed on.
Contrary to popular belief, Step #1 when you are handed a management agreement is NOT to get a lawyer.
First, you need to have a heart-to-heart discussion with your potential manager to see if you want to negotiate a contract with them. During this meeting, you and every member of your band or group (i.e., if you have multiple members) must get the opportunity to ask questions. Do not talk about percentages or other contract terms yet.
Focus on six (6) issues:
1. What is the Manager's vision?
Does his or her vision involve refinement or a continuation of your current musical, artistic or marketing direction, or does he/she have a drastic change in mind? This is NOT something to find out after you spend money negotiating a contract, or worse -- after you sign one.
2. Does the Manager have a business plan?
The manager must have a plan to make you money and expand your fan base.
Musicians - As a plan, "Get Signed" is not a business plan. It is nonsense. If your entire plan is "get signed," sell your gear and buy lottery tickets -- doom will be faster and you won't have to lug drums up the steps. Even if you get miraculously signed with no fans, your contract negotiations with the label will not be from a position of strength, and you will probably get a terrible deal that makes you no money in the long run. You will likely not recoup your advance. BUT - once your band has a substantial revenue stream and fan base, THEN, it will make business sense for a label to sign your band, and the terms will be good.
3. Does this Manager have substantial personal contacts and experience in the industry?
What exactly is the manager's availability and time commitment?
Does he or she represent other talent or have other personal commitments that might conflict with your career?
5. The Yes-Men Rule (avoid)
Don't waste your time with a yes-man (or woman). You need a manager to give honest and an objective perspective so you can improve and make money. Period. Yes-people make you feel good, but usually add nothing.
6. Personal References
Ask for three personal references, and follow up. Too bad if you don't feel like doing this - you must. Entering into a 3-5 year business relationship with someone is not a small commitment, it is your career. If the manager won't provide personal references, run away.
Assuming you have done all of the background work, then -- and only then -- it is time for Step #2, to review the specific terms of the contract. And now, it is time to get a lawyer.