Scope and Term8. Except as otherwise stated herein, the terms and conditions of this side letter agreement shall apply to all recorded products other than soundtrack albums and cast albums commenced on or after the effective date hereof made within a budget of (1)$95,000 ($99,000 effective February 1, 2003) or less for each full-length phonograph album produced during the period February 1, 2002 through January 31, 2005. In computing a budget for each full-length phonograph album, the Company shall include all costs customarily considered recording costs by the recording industry in this country, including studio charges, engineering, tape, mixing costs, payments to musicians (including their travel expenses), equipment rental, and cartage, but excluding producer and artist advances, art work, travel for artists and producers and mastering costs. The Company shall provide the Federation a copy of the producer’s approved, detailed budget 72 hours in advance of producing each album under this agreement. The form of that budget shall be as used in the Company’s normal course of business or as mutually agreeable between the parties hereto. Overages shall be excusable when they are attributable directly to the incapacity of an artist or producer, unanticipated increased mixing costs or an Act of God, including illness. In all other respects, when an overage occurs and the Company exceeds the maximum permissible budget established in this paragraph, then this side letter agreement shall not apply to the services performed by musicians, and the provisions of the then existing Sound Recording Labor Agreement shall apply, including but not limited to the provisions governing payments to musicians.
