Chapter 31: Contract Conditions

It was three o'clock in the afternoon, and the sun was no longer at its peak. It was late October, and while the autumn warmth still lingered in the air, the chill of winter was fast approaching.

Despite this, Jacob Tibo, seated in the café, was sweating profusely, his hands and feet fidgeting nervously.

The meeting was scheduled for 3:00 p.m., but to emphasize their seriousness, Evan Bell was dragged to the location by his three bandmates at 2:15.

This eagerness was a clear sign of how much the members of Melancholy Mood wanted this opportunity. Evan Bell, however, remained calm. To him, even if they were keen on signing a contract, it was important not to appear too eager.

Maintaining the upper hand in negotiations was crucial—an essential advantage in any negotiation. Unfortunately, this wisdom seemed lost on his bandmates.

After missing out on Warner Records, the pressure to secure a deal with Universal Music weighed heavily on the others. Being courted by both major labels was something most independent bands could only dream of, but missing out on both would be devastating.

Evan Bell later discovered that just yesterday, a small record label had contacted Gillen Haas. However, before the band could share the news, Universal Music reached out.

For newcomers, the allure of a major label like Universal far outweighed that of an unknown indie company, so they didn't mention the smaller label to Evan Bell right away.

This small label, called 'Free Choice Option', was indeed a legitimate but tiny operation, with only twelve employees. It was an independent record company based in Los Angeles. Evan Bell had spent some time researching it online, only to find very limited information.

Major record labels like Universal and Warner have extensive distribution networks, along with resources for artist development, promotion, and recording, plus comprehensive marketing plans. These companies have the power to transform ordinary individuals into stars.

For Jacob Tibo and the others, the choice was clear: a tiny indie label with hardly any online presence or Universal Music, one of the top five record companies in the world.

Evan Bell recalled that Universal Music had consistently led the U.S. music market in terms of share, with about 30% of albums released each year coming from them.

This dominance lasted until 2006 or 2007 when Warner Records overtook them. While Evan Bell couldn't recall the exact year, he knew that during the first half of the 21st century, Universal was the powerhouse in the U.S. record industry. No wonder his bandmates were so excited.

By 3:15, the Universal Music representative had still not shown up. Just as everyone began to question whether the call yesterday had been a prank, a slightly thin man walked through the door. He scanned the few scattered customers in the café before quickly approaching Evan Bell and the others.

"Hey, you're with Melancholy Mood, right? I apologize for being late." The man sat down in the only empty chair, a smile on his face. The group gathered around a small glass table. "I'm Craig Cook, an agent with Universal Music," he said, handing out his business card.

Evan Bell's first impression of Craig Cook wasn't great. Being a quarter of an hour late—was this a typical big-label move to intimidate new artists, or was it just Craig Cook flexing his authority?

Either way, Evan Bell didn't like it. Craig Cook's sunken cheeks, dark circles, and pale lips hinted at someone who perhaps indulged too much in smoking and drinking, leaving him looking rather worn out.

Evan Bell glanced at the business card. It was detailed, listing the company name and phone number, but only had the word "agent" in front of Craig Cook's name.

Evan guessed that Cook was either a low-level talent scout or an intermediary tasked with finding new talent for Universal Music. It seemed more likely to be the former.

While Evan examined the card, Gillen Haas had already introduced the band members and exchanged pleasantries with Cook.

Craig Cook didn't seem to be in any rush, instead engaging in casual conversation about school life and the band's journey. While these topics were somewhat related to the band, they felt like a roundabout way of getting to the point. After more than 20 minutes of this, Cook had managed to get a clear understanding of the band's situation.

The music industry, while vast, is still interconnected. Melancholy Mood's impressive performance at the Eagle Rock Music Festival caught the attention of various labels. It wasn't hard to deduce that Warner Records had been interested in the band's lead singer.

Craig Cook had found the band's demo tape at the Universal offices, listened to it, and saw potential. He thought the whole band was worth signing and developing.

Warner Records had passed on the band as a whole, likely because they had just signed Linkin Park and didn't have the resources to invest in another rock band. That decision opened the door for Cook to pursue them, leading to today's meeting.

Cook's slow pace was making Jacob Tibo increasingly anxious. He wanted to cut to the chase several times but, seeing Evan Bell and Gillen Haas engaging in the conversation, he held back, not wanting to cause any trouble. This uncharacteristic restraint left Jacob unusually quiet for most of the 20 minutes.

"Does Melancholy Mood currently have a contract?" Cook finally asked, getting to the point. "If not, Universal Music would love to welcome you to the family." Jacob nearly jumped out of his seat at these words.

Despite his lateness, his apparent unhealthy lifestyle, and a somewhat condescending tone during the conversation, Craig Cook was a skilled negotiator.

He had successfully gathered the necessary information through a casual conversation, understood his company's position, and effectively conveyed the advantages of signing with a major label like Universal.

So, when he finally made his offer, even Evan Bell couldn't help but feel a surge of excitement.

"No, we don't," Jacob blurted out, his voice louder than intended. He immediately felt embarrassed—after all, a twenty-year-old shouting like an excited kid in public was a bit much. But Jacob, ever the easygoing one, just scratched his head with a sheepish grin.

Cook didn't continue speaking right away. Instead, he looked at Evan Bell and Gillen Haas. Bruce Stewart had been mostly silent during the meeting, and Cook had already figured out that Evan and Gillen were the decision-makers in the band. After they nodded in agreement, Cook visibly relaxed.

"This is a preliminary contract," Cook said, handing it over. "You can review it and then come by the office in a couple of days to sign the final version. At a big company like Universal Music, everything needs to go through proper channels." Cook was optimistic about Melancholy Mood but could only offer a temporary contract for now.

After submitting his report, the company would review it and decide whether to extend a formal contract. If approved, Melancholy Mood would officially become a Universal-Music artist. If not, they could either stay with Universal for further development or consider offers from other labels. It was similar to being a trainee or a reserve talent.

Evan Bell wasn't well-versed in contracts—legal matters had never been his forte. So, he decided to take the contract to Eden Hudson later for a thorough review. For now, Evan flipped to the section outlining the band's rights and obligations and saw that the royalties offered were only 8%.

Royalties, in this context, refer to the percentage of record sales revenue that goes to the artist. Record companies produce and distribute albums, and for each album sold, the artist receives a certain percentage—this is the royalty.

Artists can also earn money through other means, such as song placements in film and TV, covers by other artists, and performances at concerts, but album royalties are often the main source of income from a record deal.

Royalties differ from copyright. Royalties are the income an artist earns from album sales, while copyright refers to the ownership of a song. The songwriter earns money whenever the song is used, regardless of the context. Copyright income is generally higher than royalty income.

For example, if Evan Bell wrote the song "Boundless Sky" and owned its copyright, Melancholy Mood could release the song through Universal Music. Evan would then earn royalties as a member of the band and an additional income as the song's copyright holder.

From what Evan Bell knew, the standard royalty rate for artists in the U.S. typically ranged from 10% to 20%, with most new artists receiving the lower end of that range, around 10%. However, Craig Cook's contract only offered 8%, which made Evan Bell frown as he looked up to voice his concern.