Sunset Clause
Type: noun
Pronunciation: /sun-set-klawz/
Also spelled or known as: Sunset Provision
Plural: Sunset Clauses
Related: Termination Clause
What does Sunset Clause mean? A contractual provision in music management contracts that allow a manager to earn decreasing commissions over time on deals they negotiated during the contract period, after expiration or termination.
Sunset clauses are commonly used in management contracts but can also be used in recording agreements, licensing contracts, non-compete provisions, and royalty arrangements. IE; Manager receives 15% in year 1 commission after contract expires or is terminated, 10% in year 2, 5% in year 3, 0% after year 3.
Sunset Clause synonyms: Sunset Provision, Expiration Clause, Automatic Termination Clause
Example sentence: “The payments ended after the agreement’s sunset clause was over.”
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