So here's my situation.

I currently have someone interested in making my screenplay "Groundead"

Since it's an independent project and not a huge budget, we've discussed waiving the upfront optioning fee.

This is what he has said.

__________________________

" My end goal is get it sold to an independent distribution company so we can make some cash and make another one. Typical screen writer backend is 5%, but I am willing to go a bit higher with that number if you take a gamble with me.

You will also get a theater percentage if we get something like a limited release. You and I will get a percentage of the tickets sold.

The budget would probably be about 12K, as much as I would love to give you a big fat check up front I'm going to have inject as much cash as I can into the movie so we have a fighting chance when it comes time to sell it. I will be using my own money to fund this and I won't take any upfront salary.  I will use my movie video production crew, they are really hard working guys with no ego's and they will cut me a break on their day rates.

If we can come to an agreement I would like to have you on set as an associate producer."

_____________________________

From some of our e-mails I felt like I'd still be able to hold onto some of my rights since I'm kind of taking a chance with him, but since reading the option agreement he had sent me.... I'm not too sure anymore.

Is this a typical contract? Am I entitled to more? I don't know... If anyone could help me out, kind of tell me what I'd be getting into by signing the contract I'd really appreciate it.

Here's the contract.

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Option Agreement

This written agreement will confirm the basic terms between(herein called "Producer") and(herein called "Writer").
1. Option. For good and valuable consideration, the receipt of which is acknowledged, the Writer grant to Producer the exclusive and irrevocable right and option to purchase from the undersigned the right to the original, unpublished screenplay entitled "GROUNDEAD" (herein called "Property") written by Writers.

Producer is granted a SEVEN (7) exclusive option (herein "Option") to purchase all motion picture, television, ancillary and exploitation rights and the customary merchandising rights to the Property. Writer agrees and accepts waiving demand for payment of the aforementioned Option Fee with the acknowledgment that Producer will fund the development and production cost and expenses to be delivered to the Property.  
Producers may extend the Option for an additional six (6) months upon payment of an additional Five Hundred AND NO/100 DOLLARS ($500.00).

2. Credit. In the event that 75 percent or more of the final script has been written by the Writer, the Writer will be accorded sole screenplay credit.

3. Net Profits. If the writer receives sole story and screenplay credit, the Producer shall pay the Writer 7% of 100% of the net profits derived from any motion picture produced hereunder. In the event that the writers receive shared story and screenplay credit, said percentages of net profits will be 2.5%.

4. Sequels/Remakes. Producers shall have the right to make sequels, remakes and one or more television series based upon the screenplay optioned herein, provided that there shall have first been produced a television, theatrical or other feature length motion picture under the terms of this agreement. In the event that the Writer has received sole story and screenplay credit for the motion picture, Producer shall pay the Writer, with respect to any sequel, 50% of the cash sums paid with the respect to the first production and 1% of the net profits of such remake. With respect to a remake, 33 1/3% of the cash sums paid with respect to the first production and 1% of the net profits of such remake. With respect to any television series, the per episode royalty will be in accordance with the industry standard.

5. Short Form Assignment. If Producer shall exercise the Option, Producer shall have acquired all of the Rights, and the Assignment attached hereto shall be deemed effective, and Producer may date, detach and file the same in the United States Copyright Office. Owner will duly execute, acknowledge and deliver to Producer, in form approved by Producer, any and all further assignments or instruments which Producer may reasonably deem necessary to carry out and effectuate the purposes and intent of this Agreement. If the Option is not exercised, this Agreement shall be deemed terminated and all right, title and interest in and to the Property shall remain Owner's sole property, and the Assignment shall be void.

Writer represents that he has the right to enter into and to perform this agreement and to grant all rights granted hereunder. Writer owns all rights to the Property free and clear of any liens, encumbrances, claims or litigation and Writer has full right and power to make and perform this agreement.

The parties intend to enter into a more formal agreement consistent with the terms of this purchase agreement and containing such other terms and conditions as are customary in option agreements in the motion picture and television industry.

This agreement shall be construed and governed by the laws of the State of Texas and the invalidity and unenforceability of any provision hereof shall not affect the validity or enforceability of any other provision.

Any disputes arising out of or relating to this agreement or any breach thereof will be settled by arbitration in accordance with the Rules of the American Arbitration Association.


ASSIGNMENT
For good and valuable consideration, receipt of which is acknowledged, ("Owner") assigns to the Production Company known as ("Purchaser").
1. The copyright and all rights thereunder, whatsoever in, to and with respect to the original screenplay entitled "GROUNDEAD" written by Owner and all revisions, adaptations, dramatizations and translations thereof and additions thereto, and the title, theme and characters thereof;
2. Any and all causes of action which Owner has or later may have for any past, present or future infringement or interference with any of the rights granted to Purchaser in and to this material or the copyright thereof.
Owner appoints Purchaser, its successors and assigns, Owner's irrevocable attorney-in-fact with power of substitution and delegation in Owner's or in Purchaser's name: to enforce and protect all rights, licenses, privileges or property granted hereunder under any and all copyrights therein; to prevent or terminate any infringement or other violation or any threatened infringement or threatened violation of these copyrights as respects any of said rights, licenses, privileges or property; and to litigate, collect and give receipt for all damages rising from any such infringement or threatened violation, and to join Owner as party plaintiff or defendant in any such suit or proceeding, in the discretion of Purchaser.
This Assignment is executed and delivered pursuant and subject to the agreement between Owner and Purchaser, dated as of _______________, 2011 relating to the aforesaid material. Reference is made to that agreement for further particulars with reference to Purchaser's right in, to, and with respect to this material.

GRANT OF OPTION
For good and valuable consideration, receipt of which is hereby acknowledged, the undersigned, ("Assignor"), grants to("Assignee"), the exclusive and irrevocable right and option to purchase, exclusively and forever, the copyright and all rights thereunder in, to and with respect to the original screenplay entitled "GROUNDEAD" written by Assignor and all revisions, adaptations, dramatizations and translations thereof, and the title, theme, and characters thereof, all as set forth in the agreement (the "Agreement" ) between Assignor and Assignee dated as of __________, 2011 and expiring upon a date eighteen (7) months from and after the date of execution of said Agreement by Owner and delivery of same to Purchaser. By complying with terms set forth in the Agreement, Assignee may extend the term of the Option until a date six (6) months thereafter.

This short-form Grant of Option should be read in conjunction with the Agreement, and, in the event of any conflict between the provisions of this instrument and the Agreement, the provisions of the Agreement shall control.

3 -- You don't want net profits.  You want gross.

4 -- There should be a time limit for the sequel/remake.  Repeat on the net/gross.

You should be allowed to keep the rights to the script.

Consult a lawyer.


Phil

"Producer is granted a SEVEN (7) exclusive option"

Seven what?  Months?

To back up what Phil said, don't go with net.  You're looking for adjusted gross revenue.

One recommendation: show this to an entertainment lawyer.  Not that's there's *necessarily* anything wrong with this particular contract, but you need to understand every aspect of the contract before you sign anything.

Probably will cost around $250 or so for a consultation.  Trust me.  It's worth it.    

And yes - gross points is much, much better than net.  And don't sign away your rights to the script.

Ask yourself this - what's this person doing for your script that you can't do for yourself? What contacts does this person have? Is it a filmmaker - i.e., a producer/director, or is it someone who is going to do essentially what you can do, which is pimp your script to actors, directors, distributors, etc.

Oh, and absolutely do NOT assign the copyright under an option agreement. He then owns the script and the option becomes meaningless because unless I missed it I only see a reversionary right in the option and not the assignment of copyright.

I might be wrong, but the person probably wouldn't like it that you're posting the contract, in its entirety, on the site.

I agree with Matt. By all means ask for advice, but not sure if a confidential document like that should be posted on a public forum.

If he's asking to film a feature length script, you should ask for a link to some of his previous work. Look at it and if it's crappy or doesn't look at all like something that could ever achieve distribution or a limited release, then I wouldn't waste my time or money on a lawyer. I also wouldn't take the filmmaker incredibly serious as a "professional" as he's most likely not one. I would just be very upfront and write up a contract that states that you will retain the rights to your screenplay, receive 10% of the gross, and go from there.

Frankly, he's most likely blowing smoke up your butt with that "distribution" crap because you don't just "get distribution". Especially when you're in such a spot that you can't pay the screenwriter upfront. There's nothing wrong with that, but I hate it when people try to act like they're some professional filmmaker. There's nothing wrong with a student or aspiring filmmaker wanting to make somebody's script, but when they start spewing all this crap out about "limited releases" and junk, they're just trying to make it seem like they're doing YOU the favor.

If he insists on the signing over of any type of rights to the screenplay, limited or not, then you should insist on receiving $5000 in upfront payment along with 7% of the gross. Unless he's Steven Spielberg, which he's obviously not, then you're the one doing him the favor by allowing him to use your screenplay, so there's no need to tip-toe around the issues with him. Just be blunt and tell him that you're not signing over the rights to your screenplay, only that you are granting him permission to make a single production based upon it, and that if he doesn't like that, he can find another script and somebody else to rip off.

-Landon

Quoted from Dressel I might be wrong, but the person probably wouldn't like it that you're posting the contract, in its entirety, on the site.

Contracts are cut and paste from the internet.  This one doesn't contain any personal information.


Phil

Quoted from dogglebe Contracts are cut and paste from the internet.  This one doesn't contain any personal information.

At the very least, if the Producer/Director came across this conversation, they'd know all the specifics of his negotiation tactics.  He'd have no upper hand.

And you're right, this one is pretty cut and paste, but I know that certain producers I've dealt with only wanted the contract between me and my legal counsel.

I've had to deal with similar contracts.  Pulled off the internet and full of holes.  The 'SEVEN' part is reason enough to, atleast, consult an attorney.


Phil

Quoted from Dressel At the very least, if the Producer/Director came across this conversation, they'd know all the specifics of his negotiation tactics.  He'd have no upper hand. And you're right, this one is pretty cut and paste, but I know that certain producers I've dealt with only wanted the contract between me and my legal counsel.

Thanks to everyone who gave me some input, you've really helped a great deal!

I don't see any harm in what I posted, like dogglebe said  "This one doesn't contain any personal information." To be honest if he did come across this and was offended or thought it should be kept personal, I would find it odd. The way I see it, the only reason he should be bothered is if he had something to hide.

Elmer's post seemed to emulate how I've been feeling about the situation lately. At this point the excitement of having someone show that much enthusiasm and interest in making my screenplay has warn off, and I now I'm really seeing how much I'd be bending over backwards. I'd love to see it get made but..... I'm not about to give up all my rights to my child in the process.

Quoted from dogglebe I've had to deal with similar contracts.  Pulled off the internet and full of holes.  The 'SEVEN' part is reason enough to, atleast, consult an attorney. Phil

Yeah, he later told me it's meant to say "7 months", so at least that's cleared up!

Keep in mind that you probably won't make much money on this (if anything).  What it could do, however, is give you something to put on your resume.  At this stage of the game, that's more important.

Don't give up your rights to it.


Phil