1. Hire an Attorney: Before signing anything, get a referral to an experienced music attorney.

2. Term: Usually the term in a recording agreement is expressed as an initial period (typically one year after the delivery of your album or commercial release of the album), plus a certain number of options for additional albums (typically 3-5 options). It is important to understand when the term begins and what triggers an option. Beware of automatic option periods that do not require the record company to pay you in order to exercise the option.

3. Advance Amount: Recording an album can often surpass the demands of a regular full-time job, but your bills will not wait for your first album to be released. Seek a respectable advance amount, based on the demand you have created for yourself and what you bring to the table. But remember, all amounts advanced will have to be repaid (recoupment), so be careful.

4. Budget: The saying “it takes money to make money” holds true in the music industry. Make sure the recording agreement allows for sufficient capital available to ensure your album’s success. Depending on the genre, the right producers can catapult your album sales, so make sure you have latitude to approve of such producers and the money to pay them. Try to get an assurance that at least one “MTV Style” video will be produced for your album.

5. Royalty: This is the essence of how you get paid. Make sure you are getting industry standard, at minimum, based on someone similarly situated. A typical new artist royalty rate is between 11 – 15 percentage points. Take note of any royalty deductions such as packaging deductions in the agreement.

6. Cross-collateralization: Artists are paid from several revenue sources. Your recording agreement should limit the record company’s ability to recoup (recover) any money advanced on your project to money received from the sale of records, and not publishing, merchandising, touring, etc.

7. Delivery Requirements: Delivery is your fundamental obligation as a recording artist, and it can often be a subjective determination made by your recording company. Be knowledgeable of the number of Masters (songs) constituting an album, the time period in which Delivery of the Masters is required, and whether Delivery must be “satisfactory”, “technically satisfactory”, or “technically and commercially satisfactory”. These terms can mean a world of difference for you as the artist.

8. Release Obligation: Ironically, just because you record an album does not mean it has to be released to the public for distribution. Seek to obtain a measure of commitment from your record company to timely release your album after you have Delivered the completed album to the record company (typically about 4 months).

9. Rights: As an artist under the Agreement, you will grant a measure of rights to the recording company to use your works for profitable ventures. However, beware of freely granting publishing, merchandising or management rights, which is an entirely separate matter. Also, seek to have those rights granted in the recording agreement automatically revert back to you simultaneously with the termination of your Agreement.

10. Definitions: Capitalized terms in the contract usually mean more (or less) than meets the eye. Be sure to review the Definitions section for the specific parameters of the terminology.

Article Source: http://www.blogtalkradio.com

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