SFX has been extended a lifeline to pay artists
In the wake of laying off 50 employees in their New York City office as part of their bankruptcy restructuring plan, SFX has been extended a lifeline to pay artists’ booking fees for their summer festivals.
A pool of $15 million has been set aside to pay the fees of the artists that bring in the most ticket revenue, after one month of negotiations among SFX and their bankruptcy financier DIP Lenders, WME, AM Only, Windish and Paradigm Talent Agency.
The pool allows SFX to pay headliners at festivals with a capacity of 10,000 or more attendees 100% of their fee before the event. If the event is cancelled, SFX still has to pay the full fee.
In a motion to the judge, SFX lawyer Dennis Meloro stated:
“The value of the debtors’ estates and their ongoing business depends on their continued successful festivals, events and club shows. The profitability of these shows hinges, in significant part, on the artists performing and their ability to attract large numbers of fans.
The pool of artists that can reliably attract large numbers of fans to the shows is extremely limited and the vast majority of them are represented by the agents. Thus, the debtors relationship with the agents and their represented artists are vital to a successful reorganization.”
This all comes after artists demanded they be paid 100% of their booking fee prior to their name being released on the lineup for one of SFX’s festivals. Headliners will be paid 25% of their booking fee before the lineup reveal, 50% thirty days prior to the event, and the final 25% no more than five business days prior to the event.
Acts lower on the bill will be paid 100% of their fee prior to the event in a similar manner, with 15% paid prior to the lineup reveal, 40% thirty days prior to the event, and the final 45% of their fee no more than five business days prior to the event.
Hopefully, this will allow SFX to rebuild as festival season approaches so they can continue to produce their flagship events moving forward.