Legal Question in Entertainment Law in California
Option Agreement
In an option agreement to purchase a literary piece to make a feature film what does ''resale clause'' mean?
Specifically, the term states
''a 50/50 resale clause must be included in the long form agreement whereby the Estate is entitled to 50% of any revenue generated from the resale of the rights to be granted, after recoupment of the exercise price.''
1 Answer from Attorneys
Re: Option Agreement
A "resale clause" refers to the transfer to a third party of the rights you are granting in the option. For instance, if a producer buys a script, he/she would transfer rights to the production company, usually before a production begins.
The above is general information. In order to interpret the clause in your particular case, I would need to see the agreement.
Caveat: Entertainment agreements are tricky and some words have very specific meanings--it would be to your advantage (and ultimately save you a lot of grief and money) to consult an attorney before you sign any option or purchase agreement. The cost is minimal compared to the cost of later litigating a misunderstanding. Feel free to call me if you need more help with this.
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