The effect of the above is that, whatever the Artist creates, belongs to the record label signing him and if the artist decides to leak his work through another record label, there will be consequences. Also, the fact that it will apply to everything created by the artist, is an important point to pay attention to.
A Termination Clause specifies how a contract may be terminated. This clause includes the right to end a contract without paying any fees. These rules often outline who has the right to cancel the contract and why. This clause is important in entertainment contracts because it helps put the terms of the contract in perspective.
Therefore, the effect of the termination clause is that if an artist intends to be with a record label for a year, and the contract indicates that he remains with them for more than a year, then it means before signing such contract, the termination clause has to be varied.
The Disagreement Clause, otherwise known as the Dispute Resolution Clause, explains in writing between parties, the procedure to be followed in the event of a dispute. Most contracts, describe steps to do in the event of a problem so that it doesn’t get worse.
The effect of a disagreement clause is that parties treat each other with respect. It also instils confidence in parties on the need to resolve any dispute that may arise, with ease.
Limitation/Indemnification Liability Clause
This clause deals with the parties agreeing to reduce their possible financial risk in carrying out their obligations under the agreement by limiting their liability for potential future liabilities. Simply put, the Liability Clause controls a party’s total risk or financial exposure under the contract.
If there are no liability restrictions in your contract, then it means the other party is willing to accept unlimited liability.
In other words, the effect of not having the clause is that the party may be held fully accountable for any harm brought on by the performance of the contract.
This clause indicates a legally binding payment granted to an individual or business in exchange for continued use of their assets, such as copyrighted works, franchises, and natural resources, which is known as ‘Royalty’.
In other words, it is a sum of money given to a writer, musician, inventor, etc., each time whatever they have developed or invented is purchased or used by others.