Time now for some hardcore advice on the business of show business. And we can think of no better source to turn to than Stage 32:
Understanding The Option Agreement For Your Screenplay
by Wallace Collins
Many writers dream that someday their story or script will garner interest from someone who wants to develop it into a film or TV project. Usually, the first step is when that someone, maybe a producer or a production company or even a studio, offers the writer a contract known as an option agreement. As with all such matters where art meets commerce, I always advise that if you are asked to sign anything – other than an autograph – you should have your lawyer review it first. Every writer should have a literary agent and a lawyer advising them about their business dealings once they get to this stage of the process, where the creative spills over into the business world.
An option agreement at its most basic is a contract whereby the writer grants someone, for a period of time and for a payment, the right to make a film of the writer’s screenplay. The three main material issues that usually arise in negotiating such a deal are the length of the option period, the amount of the option payment and the purchase price if the project comes to fruition. How each of these issues will be resolved will vary depending on the negotiating leverage of the respective parties (i.e., whether the writer is a beginner or has had prior success in the industry and whether the producer is an experienced player or just a fledgling production company trying to get traction).
NOTE FROM LB: 
