Standard Option Agreement Screenplay

12. April 2021    

An option agreement in its most basic form is a contract by which the author grants someone, for a period of time and for payment, the right to make a film about the author`s screenplay. The three main issues that generally arise when negotiating such an agreement are the length of the option period, the amount of the option payment and the purchase price when the project is born. How each of these problems is resolved depends on the bargaining leverage of the parties involved (i.e. whether the author is a beginner or has already succeeded in the sector and whether the producer is an experienced player or only a young production company trying to get traction). But you haven`t sold anything yet. Nothing was produced. And you`re probably not up to the level of offering you great studio writing commands. However, industry insiders ask to choose your scenario. There are some catches and red flags that you need to note before passing on your script to someone. An option agreement sets an „option period“ or deadline for the start of production of the project. It can vary from six months to two years or more, depending on the length of the negotiations. These agreements often involve additional time for the manufacturer to extend the duration of the agreement, given the additional payments made to the author.

The wave effect of this one-two punch sent shockwaves across the film and television industry. Studios and networks have become much more risky. Expenses such as high ticket-scenario option fees were denied. In this article, in order to keep it simple, I will guide you through some of the most important points that you need to consider when negotiating an option agreement. I`ve also created a handy checklist, which should include an option agreement that you can use side by side with this article to make sure you`ve covered your basics. If you sign a scenario option agreement, you don`t relinquish the rights to your scenario indefinitely. There is always a contractual schedule for industry insiders to retain exclusive rights.

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