TLC Settles Contract Dispute With Label
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R&B; act TLC has accepted an offer from LaFace Records and its parent companies, Arista and BMG, to settle a lengthy and heated contract dispute that resulted in the trio filing for bankruptcy last year.
Under the settlement, LaFace will pay TLC an estimated $10 million in advances, most of which must be paid back from future royalties. The trio will also receive an 18% royalty rate on each record it sells--up from 7% under its 1991 deal signed with the Pebbitone production company. The settlement also requires TLC to pay Pebbitone more than $2 million to dissolve its contract and to deliver two more albums to LaFace in addition to the six it already owes.
After failing to renegotiate its contract last year, TLC filed for protection under Chapter 11 of the U.S. Bankruptcy Code.
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