The last thing she should do is "memorialize" anything. Then she will definitely be stuck paying him forever at his obscene percentage.
The guy is a crook, plain and simple. He sees an easy opportunity to make money for doing next to nothing.
There are a few things that don't make sense and that the OP still maddeningly refuses to elucidate on (maybe she just doesn't know).
1. Why is this guy in the position to get her this audition? Does he actually have some tangible connection to the band (used to play them, friends with them, same management team, etc...)? Or did he just find an ad in an music industry paper, etc... and think she would be a good fit and started seeing dollar signs?
2. What is the actual process by which this alleged audition was set up? Did the guy make contact? Did he give her the contact information to set up the audition herself?
3. Is there actually an audition? This band is apparently in LA, where is the audition going to be? Is there an actual date, time, and place for the audition that's been finalized? Did that info come from the band and their organization, or from the shady douchebag?
4. If there is an audition, or it can't be verified, how did she get it? From what I've seen, it doesn't seem like she's been in any particularly successful bands or is well known or anything like that. And she says she is supposed to send a demo to the douchebag (presumably to send along to the band). So my question is how did she get an audition without them hearing her or her having a strong reputation? And if she does have the audition, why does she need to send the demo? Something doesn't make sense about that whole process.
If you have a date, time, and place for the audition already confirmed and/or if you have the bands contact info (or could look it up, I'm assuming by now you probably know who the band is), just send them your demo directly. The less part the douchebag has in the whole process, the less claim he will have on any money down the line.
If you have to still go through him to get to the point of an audition, I would string him along only as long as necessary, and be vague and ambiguous with your replies. Use his own eagerness for you to get this gig against him. He WANTS this really badly, because he thinks it will be a big payday for him forever basically. I mean, if you take 20% of someone's lifetime earnings for 5 minutes of work, and you do that 5 times, you just set yourself up with a full income for life for about half an hour worth of work. Don't look at it like "oh, but I'll still be making so much more than I ever have". Look at it like you are EARNING THAT MONEY. If you get the gig, it's YOUR MONEY. He doesn't deserve ANY of it, let alone 20% forever. Think how much better you'll be set up later on in life with that extra 20% accruing in a retirement account. Also, keep in mind, if this band is legit, you are going to be paying taxes on what you make. Which will probably be about 25% or so as well. Are you really ok with losing half your income to others?
And if you can't manage to at least see a lawyer for free for a consultation, at least get on the internet and do some searching for both federal contract law and NYS/NYC contract law and try to get those answers yourself to the extent that you're able. Typically whatever codes you need will be available online, although you might have to poke around a bit to find the actual text.
You really need to wake up to the realities of the situation and be your own advocate. Because as much as people here would like to help you, all any of us can do is just give you the best advice we know how to give. YOU are the one who has to get out there in the real world and make it happen for yourself. You might think you will get there by being a doormat, but actually the reverse is true. Someone like puff daddy has probably 100s of millions of dollars, and yet he has zero talent. So how do you think he got to where he is now (or lets say where he was 10-15 years ago)? By being assertive and getting things done and not taking any BS from anyone. Don't be a bitch about it, but you have to look out for yourself.
Good luck.