While this is acceptable for new authors with no prior credits, I would seek to limit the option period and obtain more points on the back end of the deal. In most cases, the initial option price is about ten percent of the ultimate purchase price. And, while any initial option fee may be applied against the purchase price, it is possible to negotiate that renewal options fees not be so applied. In any option or purchase agreement is important to be clear about what rights are being acquired. For example, if the Producer is acquiring the right to make a feature film based on the literary property, it is important to distinguish between granting video rights and granting television series rights.
Remakes also require additional fees.
Television series rights and multimedia rights are extremely lucrative and complex, as are merchandising rights. In the event the Author grants television series rights to the Producer, a royalty formula for television series rights might involve different royalties for the pilot and subsequent episodes. In addition, the Author must receive credit on the screen and in all paid advertising under the control of the producer. For multimedia rights, a formula based on sales is typical either as a per unit percentage or a fee payable based on certain sales plateaus. Force majeure clauses can be very important in option agreements.