A Reader Asks:
I sold a five-year option to my screenplay three years ago, and it appears that we're going nowhere with the company that bought it. I recently "pitched" my story to a well-heeled friend in the film business, and he showed interest, which waned immediately when he heard about the option. Is there a cool way of having the first buyer releasing his rights without having to pay back any of the (very small) option price?
Larry Zerner Esq. Responds:
My question for you is, "What were you thinking when you gave someone a five-year option." This is way too long an option period and it violates the first rule of options, which is "Keep your option period as short as possible."
That being said, one cool way to have the first buyer release his rights without having to pay back any of the option is to build a time machine and go back in time to change your five-year option to a three-year option. However, since that is probably impossible, here are some more practical ideas.
1. Just ask. If this company has held onto the rights for three years and it's not going anywhere, they may just be willing to give you back the rights, figuring that if they can't sell your script, there's no way you're going to be able to do so. --
2. If they won't just give you the rights back, then the question is, "what will they take instead?" If the option price was indeed very small, offer a pro-rated sum (i.e., if the option price was $500 for five years, offer them $200 for the remaining two years). If you have a serious buyer, that would be a small price for you to pay.
3. If you really don't have the cash, ask your "well-heeled friend" to advance you the money to get out of the option. If he is really interested in your script and wants to option it himself, the extra money needed to get your script out of the current option should not be a problem.
4. You might also offer the current option holder a piece of any money you receive in the event that your script is sold during the remainder of the option term. The current option holder is probably worried that if he gives you back the rights to the script, you'll sell it and he'll look like a chump. By giving him a piece of any potential sale, you can alleviate his fears that he is completely giving away the rights to a potential blockbuster.
5. Also, if you had another script that the option holder might like, you could offer him an option on the new script in exchange for releasing the old one. Since he's had no luck with your first script, he might be willing to exchange it for something new.
Using one or a combination of these ideas should get you your script back. But, in the future, try to limit your option periods to a much shorter time, preferably no more than one year with the opportunity for the option holder to pay for additional extensions. By keeping the option period shorter, you make sure that the producer is not sitting on your script, but is working hard to get it sold. And, by making him pay for extensions, you ensure that the producer doesn't hold onto the rights after his interest has waned.