Oops, yes you're right, it is a percentage of the net. I suspect that the contract in question is a relic from the sixties, when Hollywood accounting was nowhere as sophisticated as it is now and a percentage of the net actually got you some money.
Oh this sucks so much, man. I've been listening to this guy for like ten years going back to when he was the night guy on 93.3 (The Power Pig). I knew something was wrong when I heard rock music on the station this morning.