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Management Agreements and Related Issues (Part 2) - Page 8

© Kent Newsome

2. Discussion. Indemnification provisions are part of almost all management contracts and are, in effect, agreements by each party to protect the other party against any losses wrongfully caused by the party making the indemnity. It is important that the indemnification be mutual, and not just from the musician to the manager. In addition, it is possible that the manager may have insurance to cover certain losses that would otherwise be covered by the musician's indemnity. If this is the case, waiver of subrogation provisions and express negligence provisions should be included in the management contract. If this is not the case, the musician may want to consider requiring the manager to carry certain insurance.

Set forth below is a waiver of subrogation and express negligence provision that I have used on various occasions:

Neither party shall have any right or claim against the other party for any property damage or other loss, whether caused in whole or in part by the negligence of the indemnifying party by way of subrogation or assignment, and each party hereby waives and relinquishes any such right. IT IS THE EXPRESS INTENTION OF BOTH PARTIES THAT THE WAIVERS CONTAINED IN THIS PARAGRAPH APPLY TO ALL MATTERS DESCRIBED HEREIN, INCLUDING, WITHOUT LIMITATION, ANY OF THE SAME THAT ARE CAUSED, IN WHOLE OR IN PART, BY THE NEGLIGENCE OF EITHER PARTY OR ITS EMPLOYEES.

L. Default and Remedies.

1. Sample Provisions.

(a) Artist acknowledges and agrees that Manager's right to represent Artist as Artist's sole and exclusive personal manager and Artist's obligation to solely and exclusively use Manager in such capacity are unique, irreplaceable and extraordinary rights and obligations and that any breach or threatened breach by Artist thereof shall be material and shall cause Manager immediate and irreparable harm to its reputation and goodwill in the Entertainment Industry, and other immediate and irreparable harm which cannot be adequately compensated for by a money judgment. Accordingly, Artist agrees that, in addition to all other forms of relief and all other remedies which may be available to Manager in the event of any such breach or threatened breach by Artist, Manager shall be entitled to specific performance, an injunction or other equitable relief against Artist to enforce Manager's exclusive rights hereunder.

(b) If at any time Artist fails, for a period in excess of three (3) consecutive months (a "Three Month Period"), to fulfill or perform any obligation assumed by Artist hereunder, then, without limiting Manager's rights, Manager shall have the right, exercisable at any time after the Three Month Period by notice to Artist, to extend the expiration date of the then current period to the Term. Such extension shall continue until Artist has fully cured such failure and the then current period of the Term shall be extended for a period of time equal to the duration of any such failure. Artist acknowledges that Manager's exercise of its rights hereunder shall not in any way affect or diminish its right to equitable relief under this Section ____.