A third form of compensation is the payment of the eventuality or the “back-end”. For a theatre film, this is usually a net participation in a theatrical publication of the film, expressed in a small percentage (perhaps 5%) manufacturer`s network. For television films or mini-series, royalties are paid. Royalties are usually expressed as a fixed amount per hour or a half-hour episode. Event payments affect the outcome of a successful project for a producer. However, if a project is successful, it is likely that the manufacturer will not be able to do anything if the author participates in this success. Since the net profits or royalties are speculative, it is relatively painless for a producer to allow an author to participate in the potential success of the production. A typical option for buying history rights contains a number of important provisions. The option gives the manufacturer a period, usually a year or two, during which the manufacturer has the exclusive right to acquire the rights to the story. It is common for a provision to allow the manufacturer to extend the option for an additional period (often an additional year) at the manufacturer`s discretion.

This reduces the producer`s ex ante costs and gives the producer some flexibility to assess the viability of the project in the future. If the manufacturer does not exercise the option within this time, the option expires and all rights accrue to the author. Unless your story is based on a story of your own creation or a non-fiction event based on your own search for public documents, one of the first steps you need to take to develop a feature film or TV movie is to acquire the underlying story rights. Before you spend time writing and editing the script, looking for production financing or creating talent, make sure you have the right to use the story you want to tell in your film. The option to purchase contracts usually consists of two supporting documents, an option contract and a sales contract, although the provisions of each document are sometimes included. In both cases, it is very important to negotiate the terms of the sales contract at the same time as the terms of the option. An option contract that does not contain the specific terms of purchase is a worthless option: all it gives the manufacturer is the right to negotiate the terms of purchase at a later date. The owner of the rights to the story is not required to sell the property, unless the essential terms of the purchase (buyer and seller, purchase price, acquired rights, offer and acceptance) are included either in the option or in a joint sales contract. Another important grant from the producer`s point of view is the right to make modifications to adapt the work to a film or television production.