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Zachary
Zachary, Attorney
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Should I be concerned by this part if an agent - author contract? .

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Should I be concerned by this part if an agent - author contract?

.  The said agent is hereby empowered by you to act on your behalf in all matters arising from and pertaining to this Agreement.  For services rendered and to be rendered, it is agreed between you and the agent that you do hereby irrevocably assign and transfer to said agent, and said agent shall retain, a sum equal to [to be inserted as applicable] %, as an agency coupled with an interest, out of all gross monies accruing to your account under this Agreement, prior to deductions from or charges against such monies for any reason whatsoever.
Submitted: 10 months ago.
Category: Business Law
Expert:  Zachary replied 10 months ago.
Hi,

My name is XXXXX XXXXX I will be assisting you with your legal question.

This is the part of the contract which empowers the agent to actually do what you hired him to do (i.e., act as your agent). This is also generally how literary agents are paid (general rate is 15%).

So, overall, this is a standard clause and there's nothing here which you should be worried about.

Please let me know if you have any further questions. Please also kindly consider rating my answer positively so that I am credited by the website for my work on your question. Rating positively does not cause an additional charge and does not prevent us from further discussing your questions.

Kind regards,
Zachary
Customer: replied 10 months ago.

The part that I was concerned about is the meaning of irrevocable and coupled with interest in this section:


 


hereby irrevocably assign and transfer to said agent, and said agent shall retain, a sum equal to [to be inserted as applicable] %, as an agency coupled with an interest,


 


 


---


 


Does this mean they will be paid commission on these works even after I have left the agency if I leave?

Expert:  Zachary replied 10 months ago.
That is unlikely. The agreement should not convey a residual interest to him after termination of the agreement. However, I'd have to see the entire agreement to be able to say that with any finality.

You can scan it as a PDF and attach it to your response to let me review it in the entirety on this issue.
Customer: replied 10 months ago.

Here it is, thank you so much.





Dear _________________:


 


This agreement (this “Agreement”) shall confirm the agreement between X and ____________ (“You”) with respect to Xs services as your representative in accordance with the following.




  1. Rights Granted. You hereby engage X during the Term of this Agreement as your exclusive representative and grant to X the sole and exclusive worldwide right to negotiate agreements for: (a) the sale, license or other disposition of the literary work [presently entitled TITLE] [or works listed on Schedule A annexed hereto] and all other literary materials created by You during the Term (each a “Work” collectively, the “Works”); and (b) any and all derivative, subsidiary and/or ancillary rights in and to the Works, including, without limitation, any literary works, motion picture, television, audio, interactive or multimedia productions, products or other properties of any sort or nature now known or hereinafter developed based upon or relating to the Works (each, an “Ancillary Work”).




  2. Term.




    1. The term of this Agreement shall commence on the date hereof and continue for [_____] years thereafter (the "Term"). [***The Term of this Agreement shall automatically be extended for successive, additional periods of [***_____***] months each, unless the party wishing to terminate this Agreement gives written notice of termination to the other within sixty (60) days prior to the date on which the Term otherwise would expire.***]




    2. If there is a Covered Agreement (as defined in Paragraph 3(c) below) relating to the exploitation of rights in a Work, then, notwithstanding the expiration of the Term, X shall have the right to act as your sole and exclusive representative, with respect to any agreements that You or any entity owned or controlled by You, may enter into relating to such Work and/or any Ancillary Work based thereon for the five (5) year period immediately following the expiration of the Term (collectively, “Post-Term Ancillary Agreements”).




    3. X shall make reasonable efforts to keep You advised as to all negotiations that X undertakes on your behalf hereunder. Any and all agreements negotiated by X hereunder shall be subject to your approval and shall be entered into by You and in your name. You shall refer to X all inquiries pertaining to each Work and each Ancillary Work to facilitate the performance of X's functions hereunder.





  3. Compensation.




    1. In consideration of X's services hereunder, and for other good and valuable consideration, the receipt and adequacy of which You hereby acknowledge, X will be entitled to the following commissions earned by, paid to, or credited to You, or any entity owned or controlled by You, under any Covered Agreement (as defined in Paragraph 3(c) below) in perpetuity:




      1. Fifteen percent (15%) of the gross compensation, without any deductions therefrom (hereinafter “Gross Amounts”), earned by, paid to, or credited to You, or any entity owned or controlled by You, on account of the exploitation of rights in any Work and/or any Ancillary Work, in either the United States or Canada, regardless of when such Gross Amounts are received;




      2. Twenty percent (20%) of the Gross Amounts earned by, paid to, or credited to You, or any entity owned or controlled by You, on account of the exploitation of rights in any Work and/or any Ancillary Work in any country other than the United States or Canada when X acts as the agent in the foreign country, regardless of when such Gross Amounts are received; and




      3. Twenty five percent (25%) of the Gross Amounts earned by, paid to, or credited to You, or any entity owned or controlled by You, on account of the exploitation of rights in any Work and/or in any Ancillary Work in foreign markets with a lesser demand for book rights (e.g., Turkey, Romania, Estonia, Vietnam, Hungary and China) in which X engages or works with any other representative or entity of its choosing in such country (as described in Paragraph 3(b) below), regardless of when such Gross Amounts are received.





    2. In providing its services hereunder,X may engage or work with any other representative or entity of its choosing, it being understood that if X engages such representative or entity, X will pay any commission to which such representative or entity may be entitled.




    3. As used in this Agreement, a "Covered Agreement" means: (i) any agreement relating to any Work and/or any Ancillary Work that is entered into during the Term; (ii) any agreement relating to any Work and/or any Ancillary Work that is negotiated during the Term and entered into within ninety (90) days following the expiration of the Term (including, but not limited to, an accepted offer from a publisher, with or without a fully negotiated and executed publishing agreement); (iii) any and all extensions, renewals, modifications and/or amendments of or to any of the agreements described in subparagraphs (i) and (ii) of this Paragraph 3(c); and (iv) any Post-Term Ancillary Agreements.





  4. Payment.




    1. You shall cause any third party who is obligated to pay You, or any entity owned or controlled by You, Gross Amounts pursuant to any Covered Agreement to make said payment to X. X shall have the irrevocable right to deduct from Gross Amounts the commission payable to X hereunder and any fee that a publisher may charge to obtain an electronic version of a Work for X’s use in connection with selling rights in such Work in foreign markets and other markets and formats and to remit the balance to You. If any third party pays or credits to You, any entity owned or controlled by You, your attorney, your agent, or any other third party on your behalf, Gross Amounts earned on account of a Covered Agreement, You shall cause X to be paid X’s commission promptly following the receipt of such Gross Amounts.




    2. At X's request, a provision shall be included in each Covered Agreement as follows:





 


All sums of money due you under this Agreement shall be made payable to, and collected and received by, your agent,X, and the receipt of such sums by said agent shall be a good and valid discharge of all such indebtedness. The said agent is hereby empowered by you to act on your behalf in all matters arising from and pertaining to this Agreement. For services rendered and to be rendered, it is agreed between you and the agent that you do hereby irrevocably assign and transfer to said agent, and said agent shall retain, a sum equal to [to be inserted as applicable] %, as an agency coupled with an interest, out of all gross monies accruing to your account under this Agreement, prior to deductions from or charges against such monies for any reason whatsoever.




  1. Representations, Warranties and Indemnity.




    1. You represent and warrant to X that: (i) You are the sole and exclusive owner of each Work; (ii) You have the right to enter into this Agreement; (iii) no act or omission by You hereunder will violate any right or interest of any person or entity or will subject X to any liability, or claim of liability, to any person or entity; and (iv) any sale, transfer or assignment, of your rights, title, and/or interests in or to any Work or any Ancillary Work, for any purpose whatsoever, shall be subject to the terms of this Agreement.




    2. You shall indemnify and hold harmless X and each of its affiliated companies and each of their respective employees, agents, successors and assigns from and against any and all losses, liabilities, damages, costs, expenses and fees (including, but not limited to, reasonable attorneys' fees) incurred by any of them by reason of the breach, or alleged breach, of any representation, warranty or agreement made by You in this Agreement.





  2. Waiver.




    1. You recognize that X and Xs clients may have access to and/or may create or have created materials and ideas that may be similar to a Work in theme, idea, plot, format or other respects. You agree that You will not be entitled to any compensation because of the use of any such similar material, which may have been independently created by X or any of its clients or may have come to X or its clients from any other independent source.




    2. You acknowledge that X may render similar services as those specified herein for other persons or entities and that X shall not be required to act exclusively for You. This Agreement does not constitute a partnership or joint venture between You and X.




    3. X shall not have any liability for the loss, destruction, or theft of any copies or manuscripts of any Work and/or any Ancillary Work.





  3. Notices. All notices or remittances which either party may wish or be required to serve on the other shall be in writing and may be served by personal delivery, or by certified mail, return receipt requested, to the address set forth below, or to such other address as may be conveyed by like notice to the applicable party, as follows:




    1. To X:




    2. To You: .





  4. Miscellaneous.




    1. X hereby advises You to retain an attorney to review this Agreement for You prior to execution.




    2. You hereby grant to X the right to use your name, likeness, and biography in connection with advertising, publicity, and promotion of You, the Works and/or any Ancillary Work, and in connection with the matters covered by this Agreement.




    3. You understand and agree that X is acting as your agent with respect to agreements relating to the Works and to the Ancillary Works and that each such agreement will be between You and a third party and X shall not be, and shall not be deemed to be, a party thereto. You further understand and agree that X shall not be liable to You for any such third party’s failure to comply with representations or warranties made and/or covenants and obligations owed to You under any such agreement.




    4. This Agreement contains the entire understanding between X and You. This Agreement shall be binding upon and inure to the benefit of your and X's respective heirs, executors, administrators, representatives, successors and assigns. No promises, representations or inducements, oral or written, have been made except as expressly set forth herein. This Agreement may be amended or modified only in a writing signed by You and X. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any prior, concurrent or subsequent breach of the same or any other provisions hereof, and no waiver shall be effective unless made in writing and signed by an authorized representative of the waiving party. If any provision of this Agreement is for any reason held to be invalid, illegal or unenforceable in any respect, the remaining provisions shall remain in full force and effect. This Agreement shall be construed in accordance with the laws of the State of New York applicable to agreements executed wholly to be performed within such state.





Any controversy or claim arising out of, or relating to this Agreement, or any alleged breach thereof, shall be resolved by a court of competent jurisdiction (state or federal) located within the State of New York, Borough of Manhattan and You agree and hereby consent to the jurisdiction of such courts in connection with any action or proceeding arising out of this Agreement. In any action or proceeding arising out this Agreement, You waive personal service and agree that service of any pleading, notice, complaint, etc. may be served by certified or registered mail at your address for notices as set forth in paragraph 7 above and such service shall be deemed effective as if personally served upon You. In resolving any dispute or construing any provision hereunder, no presumptions shall be made or inferences drawn because the attorneys for one party drafted this Agreement.




    1. You understand and agree that the provisions of this Agreement which by their nature survive the expiration of the Term (i.e., Paragraph 2(b), Paragraph 3, 4, 5, 6, 7 and 8) shall survive the expiration of the Term hereof.




 


(f) This Agreement may be executed in duplicate counterparts, all of which together shall constitute one agreement.


If the foregoing accurately reflects our agreement, please acknowledge by signing in the space provided below and returning the original to X.




By:



Title:



ACCEPTED AND AGREED TO:




________________________________


(signature)




(print name)

Expert:  Zachary replied 10 months ago.
OK. This is an agreement that contains terms I've seen before, but it is not extremely beneficial to you.

It works like this:

1. You write a book or create a "work"

2. Agent negotiates a contract for the publishing of the book or work.

3. Agent gets a commission on any payment on that contract forever and this right to payment is not terminated by firing the agent.

4. If within 5 years of the end of your agreement, there is an ancillary work (for instance, a movie or play) based on one of the books/works you create during the term (even if you did not publish it during the term), then this agent has the right to negotiate the contract and take a commission off of it forever.

If this worries you and you do not like this deal, then you need to tell them that you don't like the terms, and you should sit down with an entertainment lawyer to revise the contract.
Zachary, Attorney
Category: Business Law
Satisfied Customers: 4021
Experience: Internationational Commercial Attorney
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Customer: replied 10 months ago.

Thank you so much, you were very helpful and I am giving you an excellent rating.


 


If you could please clarify for me point 3 for me the agent gets a commision on any payment on that contract until the contract ends or on any contracts regarding that work forever?

Expert:  Zachary replied 10 months ago.
Interestingly, the contract is ambiguous on this point. It says that the agent has the exclusive right to negotiate any and all contracts for any work created during the term. Thus the right seems to exist in perpetuity as to any work that is created during the term.

However, this conflicts with the payment terms in 2a. There is also a "survival clause" which states that the exclusive right does not survive termination of the agreement. So, I would think arguably, a court would resolve this in favor of finding that you may negotiate a new contract on the same work after you terminate this agent and not be bound by this agreement.

The biggest problem I see here is that there is no right to fire the agent. You are stuck with this agent until the contract is over. If you write for a living, it would be in your best interests to sit down with a lawyer for a revision.

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