I friend of mine posted this message to all aspiring artist, so I thought I would share..... it's a cold world.  read:

Dear Artist:
You will record exclusively for our company during the term of this agreement. After completing your first album, we can obligate you to record up to six additional albums, but the choice of extending the agreement is entirely ours; in fact, we are not even required to release the album(s) that you record.

We will pay the costs of recording each album, but these costs will be deducted from any royalties due to you from record sales. We will also deduct 50% of certain other costs from your record royalties, such as video production and independent marketing and promotion costs.

For each album recorded you will receive an advance. The amount of the advance will be calculated by means of an impossibly convoluted formula taking into account the cost of recording the new album and sales of previous albums, and ranging anywhere from $30,000 to $300,000. All advances, whether received in cash (as just described) or paid on your behalf (such as recording & video costs) are deductions against your royalty earnings; however, if the total of these deductions is greater than your royalty earnings you will not have to reimburse us.

Despite the fact that the cost of recording your albums ultimately comes from your pocket, we will own them, and will make all decisions on how to exploit them, such as promotion, marketing, pricing, and so on. We will also decide whether and on what terms to license your music to third parties, such as record clubs, motion pictures, and producers of compilation records.

Your base royalty for sales in the US will be 13% of the retail price. To the uninitiated this may appear to result in a royalty of $2.47 for each $18.98 CD shipped to our customers. However, our computation will include a number of reductionsfor packaging, free goods, a CD adjustment, and royalties due to the producerafter which the royalty will actually be 97¢ per CD shipped, which is about 10% of the CDs wholesale price. But on the bright side, your basic rate of 13% will increase by ?% as sales surpass 500,000 units, and by another ?% after the 1 million unit level is attained. Also, if all seven albums are recorded, the basic 13% rate will gradually increase to 16%, so that if your seventh LP goes platinum, each CD we ship will produce a royalty to you of about $1.28. Sales outside the US, most of which is conducted through our affiliated companies, will be paid at a royalty rate much lower than your basic rate; the reduction ranges from 85% to as low as 50% of the US rate.

Your royalties will not be paid to you in full. As a buffer against possible returns of albums we have shipped, which generally occur at a rate of 5-10%, we will withhold 30% of the units as a reserve, and pay these out to you gradually over a 2-year period.

We will pay mechanical royalties due to the publishers of the songs you recordup to a point. If your albums contain more than 11 songs, as many do, we will charge the excess mechanical royalties against your earnings. So, for example, if 13 songs are included on your first album, the rate of 97¢ mentioned above would become 80¢ for each CD shipped to our customers. In addition, we will pay only 75% of the usual mechanical royalty for songs that you write or publish, the so-called controlled compositions.

Unless you specifically object to any royalty statement within 2 years from the time it is issued, you will lose your rights to dispute the statement. If you do object to our reported royalties, you can conduct an audit of our books and records, at your own expense.

Very Truly Yours,
The Label

Rember industry rule 4080: record company people are SHADY.