Key Man Clause
A clause within a contract that names an individual, where the contract depends upon the named individual remaining in their role. This type of clause is very common within record contracts, between record labels and bands. It allows for the term of the contract to be terminated if the named individual no longer works for the other contracted party. The key man could, for example, be a member of the band or a songwriter, and the record company says if they leave the contract must come to an end. Imagine Radiohead without Thom Yorke The Rolling Stones without Mick Jagger.
The same type of clause could give the artist the right to terminate a recording contract if the current record label owner leaves the company, or isn’t responsible for day-to-day operations. Major labels are highly unlikely to agree to this type of clause in benefit to the artist.
Key man clauses are also used in personal management contracts. A personal manager has a very close relationship with his clients. As such, many personal management contracts will name the specific manager as a “key man.”
Key man clauses also kick in if the key man is incapacitated for a length of time, or in the event of death.
A feature of “Leaving Member Provisions” within a record contract. Members are deemed to be key members and non-key members. If a non-key member leaves a band, then the record label cannot “drop” the band based on their departure.