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Contract Highlights > Term - Pg. 235

Licensing Definition of Property 235 The developer will want as expansive a definition of the property as possible, including all sequels, prequels, and other books in the series (if it is a series), any art if applicable, and rights to any other manifestations of the property. Rights Granted Because the developer may be investing millions of dollars in the development of a little-known property, it will want to obtain the exclusive option to produce, exhibit, and distribute most forms of entertainment and merchandise, including subsequent publications in the series. The production rights can be broken out into three categories: · Pre-production rights. These are the rights to use the property to create and pitch preproduction materials. · Game production rights. The rights to produce, copy, and distribute the game and any sequels, ports, conversions, and expansion packs. · Other production rights. Film, merchandise, hint books, board games, and so forth. Compensation The developer should be prepared to pay a nominal option fee for an initial term (say $750), and a lesser fee for each extension ($300). If the developer goes forward with the game's production, it will pay an exercise price of roughly 5 to 10 times the option fee, less any option fees already paid. The developer may want to pay the author a percentage of the ultimate development cost, or share a percentage of developer's net royalties with the author. The developer should pay a share of net merchandising revenue to the author. Should the developer