These are contracts that are entered into with agents, which deal with the live work of any band.
It is advisable to ensure that the agreement includes a key man clause, so if a particular agent inside an agency leaves the artist is free to go with the agent.
Agents are very personal and it is not easy for an agent to 'inherit' somebody else's artists and have the same level of enthusiasm.
Agency contracts for North America require a different expertise from the rest of the world and the UK agents should not be granted world-wide agency rights.
SPONSORSHIP OR ENDORSEMENT CONTRACTS
Sponsorship contracts concern the association of a product with the artist and usually require the artist who attends certain parties to meet certain people, to have the products name appear at venues, on programmes, to appear in adverts and to generally sponsor the product.
Endorsement contracts do not usually provide for payment of moneys but provides artists with products used in performances such as keyboards, cymbals.
These agreements concern the sale of merchandise and are split usually between tour income and retail/wholesale income.
Tour income is usually tied into the number of tickets sold for the concerts. Thirty per cent of the sale price is a reasonable split, bearing in mind the merchandiser has to manufacture as well as sell.
Artists should ensure that they are reported to daily on tour by the merchandiser as failure to do so often leaves accounting procedures open to abuse.
On Wholesale and Retail deals, the percentages are much less, between ten and fifteen per cent. The artist should always make sure that he or she has creative control so that products and designs not approved by the artist cannot be sold.
Bands often require agreements between themselves to ensure that all income is split in accordance with their agreement and that matters such as ownership of the band's name and who has overall control of the band's activities are agreed.
The issue of copyright ownership in the songs are often an issue that needs consideration. Often members of the band other than the songwriter, will consider that they should be entitled to a share in royalties because of musical input into the material. Often an income share is agreed.