What would have happened if Michael had done the O2 concerts?

[Maria MJ]

This topic may have been fragmented in other threads but I would really like to put together some speculations based on what information we have so far.
What would have happened if Michael had made it through all or part of the O2 concerts?
Leonard Rowe claims in his book that the way the contract was structured, Michael's assets would end up in AEG's hands.
If so, then what?
If AEG seized Michael's catalogs, would they keep them or would they sell them to Sony?

I'm trying to make some sense out of an alternative version here so your input is greatly appreciated.

 

[ivy]

First of all AEG could have only got Michael's assets if he didn't perform and they couldn't cover the costs. so therefore if the concerts have happened they would have no reason to get his assets. ( I believe 18 concerts was the break even point to cover the costs the rest would be profit) (note: O2 has 23,000 capacity x 18 concerts x $75 average price = $31M - you can see that ticket prices alone will cover the production costs)

Secondly the contract doesn't specifically say Sony catalog, they could have gone after other more liquid assets such as cash, property. Plus you can only get what is owed to you. For example if someone owes you $1000 you can only get that much from their assets not their whole assets. So even if they were to go after the catalog they could have only gotten a percentage of it, not whole share of Michael. (by several accounts sony/atv catalogue worth between 2 to 4 billion - Michael's share would be 1-2 billion. The costs for TII was around 30M + any advances given to Michael )

 

[Maria MJ]

Thanks for explaining, Ivy.
What about Holmby Hills rent and maintenance plus all the medical expenses they would eventually charge Michael? I mean were these accounted for in his advances or would they be deducted on top of everything else?
Whatever the case, I think anyone in AEG's shoes would be highly motivated to make this contract so "impossible" to fulfill that the other party could easily default on it, with all the consequences on the assets used as collaterals (in this case the Michael Jackson Company LLC).

 

[mier]

Even if he didn't make it through the whole tour, AEG would have made enough money out of the merchandise, TII tour dvd/blu-ray etc.

MJ's career would've been restarted and enough money would've been made.

That's my guess.

 

[ivy]

Thanks for explaining, Ivy.
What about Holmby Hills rent and maintenance plus all the medical expenses they would eventually charge Michael? I mean were these accounted for in his advances or would they be deducted on top of everything else?

Now we don't know the exact amount of advances and personal costs - the contract was redacted, Katherine's lawsuit says "substantial amount". Some accounts say that he was given $10M upfront plus all those personal expenses.

My calculation for the 18 shows showed that they were probably enough to cover the production costs. Other items such as merchandise, tv rights, dvd/bluray release etc would be enough to cover other AEG's costs (advances etc) as mier said.

Remember the estate paid what is owed to AEG from the 10% share of the executors. Therefore it doesn't look like it was an astronomical cost that would require the whole Sony/atv catalog.

Whatever the case, I think anyone in AEG's shoes would be highly motivated to make this contract so "impossible" to fulfill that the other party could easily default on it, with all the consequences on the assets used as collaterals (in this case the Michael Jackson Company LLC).

However it doesn't look like that was the case. The easiest way would have been to cancel the shows (citing some reason such as Michael's health, non attendance to rehearsals etc) and go after the assets but by all accounts (such as Katherine's lawsuit) they were pushing Michael to give the concerts, attend to the rehearsals etc. It looks like they were wanting the concerts happen.

And as we discussed once the concerts happened they would have recovered the costs from ticket sales, merchandise, live TV broadcast, future dvd release etc.

 

[elusive moonwalker]

Remember the estate paid what is owed to AEG from the 10% share of the executors. Therefore it doesn't look like it was an astronomical cost that would require the whole Sony/atv catalog.

what was that about?