Template Agreement for buying, sharing and splitting cost of PA - has anyone got one I could use?

[Greg Edwards69]

6 minutes ago, Dad3353 said:

 

If the PA has been regularly used over a decent period, it is no longer to be valued at the original buying price of £600 each. The leaving member must surely agree to a reasonable depreciation sum, no..? If not, it could be argued that he pay you all your £600 each, and keeps the PA himself. Nonsense, of course.

Your initial investment should have been 'paid back', little by little, by the gigs you've done, until its depreciated value is reached, at which point it's basically a 'free' PA that you all own, but has no residual monetary value. These arrangements can easily be made, at any time, by mutual agreement and consent. Do it now with all the current members, in preparation for the next time someone leaves. A bit late, but I hope this helps. 

This is where it gets messy. Their new guy has agreed to stump up a substantial amount upon joining the band to co-own the PA (I'm not sure I would). Absolutely, it should be based upon current market value and depreciation.

 

But if the new guy leaves in 6 months or a year, he could get back less than he put in. That would just rub salt in the wound if it were me, and could make an acrimonious split, a bitter one.

 

This absolutely needs sorting and putting in writing now, before any money changes hands.

Edited November 7, 2023 by Greg Edwards69

[TimR]

Told you so...

[Burns-bass]

Last year I bought the PA for our band and we paid it back after doing lots of gigs. I happily stored it while I owned it, now it’s a communal asset we had some “lively” conversations about where it was going to be stored and who would carry it to all the gigs (not me is the answer!!!).

 

It worked well as a model for buying it, but it’s not something I’d do again.

[Burns-bass]

Oh, but we had a written agreement about how it would be paid for before I spent a penny. We took 10% of all gig funds off until it was paid for. 

[Gasman]

Great idea @Burns-bass  but for us that train has left the station...

[jrixn1]

1 hour ago, Gasman said:

After an hour we got fed up with discussing it and reached a compromise, with the new guy offering to put in £300 and the rest of us subbing up another £75 each to pay the leaver off completely.

 

The PA cost £3,000 new, but is now only worth (say 70%...) £2,100.  So the leaver's 20% share is worth £420, not £600, and the five of you have overpaid.  In absolute terms, the new guy is worst off, having paid £300 for something worth £210.  The other four of you have paid £75 for something worth £52.50.

 

Going forward, by my arithmetic the new guy has 10% stake in the PA, and the rest of you now have 22.5% each.

[Gasman]

4 minutes ago, jrixn1 said:

Going forward, by my arithmetic the new guy has 10% stake in the PA, and the rest of you now have 22.5% each.

Yes, that sounds about right...

[TimR]

@Silvia Bluejay move to PA section? 

[Silvia Bluejay]

Thanks @TimR. I've moved it, but I had to think about it for a while - it has a more general scope than "PA set up and use". However, I've left a link to this thread in GD as well. 👍

[Gasman]

AS the OP I owe it to the collective to say how our shared purchase ended! The new PA turned out to be great but only if its sponsor (the guitarist) got to gigs at least 90 mins before the rest of us to set up the local wi-fi, tablet, cabling etc. He didn't seem to mind this, but using the tablet to balance the whole band sound FOH was clearly too much for our roadie to get to grips with. So, he started a mumbling campaign against the sound quality and ease of use of the new system vs the old skool PA which he and the singist owned (they are domestic partners too), and so they eventually issued an ultimatum that the old PA must be used 'until the new one was sorted' (i.e. never, as it would never get a chance to be fully set up anywhere again)

 

The guitarist promptly walked out, joined another band and then sent the other four members £600 each as a buy-out. This was crazy generous considering the year's usage we'd had from the gear. I immediately returned £200 to cover my share of the 33% depreciation that must have occurred, but I don't think anyone else did...

 

Moral of the story? Have a written agreement up front taking account of depreciation and make sure that the gear you get is actually what you really need and have the capability of using!

[TimR]

That's frustrating. 

 

Hopefully the gear is getting a good workout now. 

[Phil Starr]

@Silvia Bluejay I wondered why this had suddenly appeared over here. Good move it's bound to stimulate debate.

 

@Gasman I love an update, the guitarist sounds grand and comes out of this well. Have you played with him since?

 

For the record I'm in the same camp as the guitarist. I own the PA, life is too short to argue about such things and I'd rather stand my round than discuss who's round it is. It also satisfies my GAS

[Gasman]

Yes, me too - in my previous band minus 2 I bought the whole PA (mics and all) and still have it 'just in case' I get to start that ska band I really always wanted to!

[Gasman]

11 hours ago, Phil Starr said:

@Silvia Bluejay I wondered why this had suddenly appeared over here. Good move it's bound to stimulate debate.

@Gasman I love an update, the guitarist sounds grand and comes out of this well. Have you played with him since?

 

For the record I'm in the same camp as the guitarist. I own the PA, life is too short to argue about such things and I'd rather stand my round than discuss who's round it is. It also satisfies my GAS

I haven't played with him again yet - that depends entirely upon me honouring my promise to leave the band that he walked away from, and the alignment of several stars and planets... who knows what the future holds?