Band agreements: More than a handshake over a few beers

By McCormicks

Bands break up, members leave, members join, a band needs to collect revenue (whether that’s from performances or royalties from records sales) and decisions need to be made. Without these things formalised it can get messy. 

For most musicians and bands it the last thing they want to do when starting out but getting the right things in place early saves a lot of hassle, pain, distraction and cost down the track. There is a very long list of bands that 'made it' but had their careers stalled or even cut short because some simple things weren’t considered important early enough. 

In this blog we give you eight things you need to think about when it comes to getting your band partnership agreement sorted.

Your band agreement can take a number of different forms; the two most common are a 'partnership' agreement or in the case of a company, a shareholders agreement. There are a number of different ways to structure your enterprise and how you do it will depend on your particular situation. Either way you will need an agreement that’s more than a handshake over a few beers and one that deals with the below at the very least.

  • Who owns the band name? Keep in mind that business names do not give ownership; trademarks and reputation do. When it comes to thinking about who owns the name, you’ll need to consider whether one person gets greater rights (because they created the band) or whether all members have equal rights. In a company situation generally it’s the ‘company’ that owns things such as the name. If a member exits, you need to consider how will you stop them from using the band name with another group.
  • Who owns the songs? As with ownership of the band name, you’ll need to decide whether all members will split the song writing (publishing) rights equally or whether the resident Lennon / Macartney duo gets the lion’s share. Because a lot of your band’s income can be generated by earning publishing royalties, considering this issue is vital. Not having it clear early can cause friction.
  • What about assets? Did each member contribute cash when setting up? Will equipment and instruments be purchased by the band or individuals? Who pays for repairs? Will you have a group bank account? Who covers expenses? How you structure this part of the agreement is up to you as a band.
  • What if we want to kick someone out or someone wants to leave? Chances are that one of these two things will happen at some point. They can both be difficult to broach if you haven’t nutted out the process back at day dot, but it’s easier to jointly decide on how a leaving member is treated whilst you’re all still excited about your new venture. Can exiting members can still earn royalties and perform the band's songs once they’ve left? With a new member joining, do they gain the immediate benefit of the hard yards done by the founding members? 
  • What happens if someone goes solo? Think Bernard Fanning, Gwen Stefani, Beyonce, the list goes on. Going solo is not uncommon but it can have implications for your band. You need to think about how a solo career will affect the band and what (if any) benefits there should be to the band if a member decides to go it alone.
  • What if we want to call it quits? Even after a band calls it a day, it could still be generating income. Your agreement should stipulate how these monies are dealt with after you’re no longer a band. Who ends up with the name, what happens to the gear, what about debts?
  • How do we split the pie? Will the lead singer / song writer earn more or will everyone share in the income equally? If one member does all the publicity for the band should they get more? Bands can either choose to look at these questions on a case by case basis or set down a blanket rule.
  • How do we resolve disputes? It’s not nice to think about now, but you need to have a process set out for resolving disputes and making major decisions. Whether it’s assigning voting rights or using a third party to help you break the impasse, this is something you need to have in place. Unfortunately if you don’t have something in place dealing with either of the points above you will be likely to spend an unnecessary amount of time resolving disputes anyway, without a roadmap that all parties are aware of and have agreed to. 




Findlaw

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