Option and first-look agreements for scripts and shows.

This article is for informational purposes and general commentary only. It does not constitute legal advice and does not create a solicitor-client relationship.

Developing a script or a show for the stage or screen takes money and time, and it often fails before it reaches an audience. A producer who has read your script may believe in it, but will rarely pay the full price of the rights up front, before the money to make the work is in place. The tool that bridges that gap is the option. It lets the producer tie up the work for a period while they try to raise the money and put the project together, without buying it outright. This note explains what an option is, what its key terms do, how it differs from a first-look or first-negotiation deal, and what a writer should look for before signing.

What is an option agreement?

An option agreement gives a producer the exclusive right, for a defined period and in return for a fee, to acquire the rights in a work on terms that are agreed at the start. The work might be a stage play, a screenplay, a novel, a format or a concept for a show. During the option period the writer takes the work off the market and cannot option or sell it to anyone else. The producer uses that time to develop the project and raise the finance.

At the end of the period one of two things happens. If the producer exercises the option, the acquisition agreed at the start takes effect: the producer pays the purchase price and the agreed rights pass to them. If the producer does not exercise the option, it lapses, the rights stay with the writer, and the writer keeps the option fee. An option is, in that sense, a paid holding pattern. It buys time and exclusivity, not the work itself.

What are the key terms of an option?

A well-drafted option turns on a handful of terms. The option fee is the money paid for the option itself. It should be a real sum rather than a token one, and the agreement should say whether it is applied against the purchase price if the option is exercised, or kept by the writer on top of the price. The option period is how long the producer has to decide, and options are commonly written for twelve to eighteen months, often with one or more extensions that carry their own further fees. The purchase price, sometimes called the exercise price, is what the producer pays to acquire the rights if they exercise.

The scope of the rights being optioned matters as much as the money. The agreement should say which rights are covered, for example stage, film, television or streaming, in which places, and for how long. Rights that are not optioned should be named as reserved to the writer, such as publication of the script, sequels, or a different medium. The agreement usually also deals with development, with any approval or consultation the writer is given over changes, and with the writer's credit. Getting these terms clear at the start is the whole point, because they are the terms that will govern the acquisition if the option is exercised.

Why must an option fix the deal, not just an intention to deal?

An option is only worth having if, on exercise, it produces a complete and enforceable contract. If the important terms of the acquisition are left to be agreed later, the option may be worth nothing, because a court will not enforce an agreement to agree. In Booker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd (1982) 149 CLR 600 the High Court considered an option to renew a lease at a rent to be mutually agreed. The Court accepted that a renewal at a rent simply to be agreed would not be enforceable, but held that the option there was saved because the contract supplied a mechanism, an arbitrator, to fix the rent objectively if the parties could not.

The lesson for an option over a script or a show is direct. Either the price and the main terms of the acquisition are set in the option itself, or the agreement includes the form of the acquisition contract as an attachment, or it provides a clear mechanism to fix any open term. An option that says the parties will negotiate the purchase price in good faith when the option is exercised is a weak instrument, because it leaves the deal to a future agreement that may never come. The way an agreement can fail for uncertainty is set out in the note on letters of engagement versus full contracts.

What is a first-look deal, and how is it different from an option?

A first-look deal is not an option over a particular work. It is a standing right over a creator's future work. A company, often a producer or a studio, pays a writer or a production company for the first opportunity to develop or acquire the projects they create over a period. In return the creator agrees to bring new work to that company first, and to give it a defined window to decide before the creator can take the project elsewhere.

The difference matters. An option attaches to one identified work and, if exercised, transfers rights in that work. A first-look deal attaches to work that does not yet exist and transfers no rights by itself. It is a right of first access and, usually, a right to negotiate first. A creator with a first-look deal still owns each new project; the company just gets the first chance at it. First-look deals are common for established writers and companies, and the exclusivity they create can be broad, so their length and reach are worth close attention.

Are first-look and first-negotiation obligations enforceable?

It depends on how clearly they are written. A promise to negotiate in good faith is not automatically binding in Australia. In Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd (1991) 24 NSWLR 1 the New South Wales Court of Appeal held that a bare agreement to negotiate in good faith towards a future contract could be too uncertain to enforce, while accepting that such an obligation can be binding where the agreement is clear enough for a court to give it meaning. A vague first-look clause that just says the creator will talk to the company first may give a court nothing it can enforce.

A tighter clause is far more likely to hold. It helps to spell out what triggers the right, what the creator must show and when, how long the negotiation window runs, and what the creator may do once it closes. It also helps to be clear about which kind of right is being granted. A right of first negotiation obliges the creator to negotiate with the company first for a set period. A right of first refusal, or a matching right, lets the company match a genuine offer the creator later receives from a third party. They are different rights with different effects, and an agreement should say which one it is.

What rights does a producer get on exercise, and what does the writer keep?

When an option is exercised, the acquisition set out at the start takes effect and the agreed rights pass to the producer. Those rights are usually taken by assignment or by an exclusive licence of copyright. Under the Copyright Act 1968 (Cth), an assignment of copyright has no effect unless it is in writing signed by or on behalf of the assignor, and an exclusive licence must also be in writing. Rights can be split, so a producer might take the film and television rights in a territory for a term while the writer keeps the stage rights, the publishing rights and any sequels.

This is why the reserved rights clause carries so much weight. Anything the writer does not clearly keep can be swept into the grant. A writer should make sure the agreement names the rights that stay with them, and should think about the future work as well as the present one, including sequels, prequels, spin-offs and adaptations into other media. How copyright is assigned and licensed, and how the grant can be limited, is set out in the note on assigning and licensing copyright in creative work.

What about moral rights and credit?

Moral rights are separate from copyright and cannot be assigned. A writer keeps the right to be named as the author, the right not to have the work falsely attributed to someone else, and the right to object to treatment of the work that is derogatory. A producer cannot buy those rights. The most a producer can obtain is the writer's written consent to specified acts or omissions that would otherwise breach them, and an option or acquisition agreement will usually ask for consents of that kind alongside the credit terms.

Credit is worth settling in the option itself rather than leaving it to the acquisition. A writer should agree how they will be credited, in what form, and where, and should read any consent to acts affecting their moral rights carefully before signing. How moral rights work, and what a consent really covers, is set out in the note on moral rights for Australian performers and creatives.

What should a writer watch for before signing?

A few points recur. The option fee should be a real amount, and it is better for the writer if it is paid on top of the purchase price rather than deducted from it. The option period should be as short as the producer genuinely needs, with any extensions paid for, so that a stalled project does not lock the work up for years for nothing. The terms of the acquisition should be fully set in the option, so that exercise produces a complete contract and not a fresh negotiation. Reserved rights should be named, and reversion on non-exercise should be clean, so the writer gets the work back free of any lingering claim.

For a first-look deal, the length and breadth of the exclusivity are the main things to weigh, because the deal can tie up a creator's future output for years. It is worth being clear about which projects are caught, how long the window runs, and what the creator can do once it closes. Options and first-look deals are ordinary and useful tools, but they are drafted by the party acquiring the rights, and their terms run in that party's favour unless a writer reads them closely and asks. Getting advice before signing is the cheapest step in the whole process.

Frequently asked.

What is an option agreement for a script or show?

An option agreement gives a producer the exclusive right, for a set period and in return for a fee, to acquire the rights in a script, show or other work on terms agreed at the start. During the option period the work is off the market. If the producer exercises the option, the agreed acquisition takes effect and the rights pass on payment of the purchase price. If not, the option lapses, the rights stay with the writer, and the writer keeps the option fee.

How long does a film or stage option usually last?

There is no fixed length set by law, but options are commonly written for twelve to eighteen months, often with one or more extensions that carry their own further fees. A shorter period suits the writer, because it limits how long the work is tied up if the project stalls. Any extension should be paid for, so the producer keeps the exclusivity only by continuing to pay for it.

Is the option fee deducted from the purchase price?

That depends on what the agreement says, and it is a point worth negotiating. In many options the fee is applied against the purchase price, so it counts as a first instalment if the option is exercised. In others it is kept by the writer on top of the price. The writer is better off where the fee is additional rather than deducted, and the agreement should state clearly which applies.

What is the difference between a first-look deal and an option?

An option attaches to one identified work and, if exercised, transfers rights in that work. A first-look deal attaches to a creator's future work and transfers no rights by itself. It gives a company the first opportunity to develop or acquire the projects the creator makes over a period, usually with an obligation on the creator to show new work to the company first and to negotiate with it before going elsewhere. The creator still owns each new project.

Is a promise to negotiate in good faith enforceable in Australia?

Not automatically. In Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd (1991) 24 NSWLR 1 the New South Wales Court of Appeal held that a bare agreement to negotiate in good faith can be too uncertain to enforce, while accepting that it can bind where the agreement is clear enough for a court to give it meaning. A first-look or first-negotiation clause that spells out the trigger, the process and the time window is far more likely to be enforceable than a vague promise to talk first.

What happens to the rights if the option is not exercised?

If the producer does not exercise the option within the period, the option lapses. The rights stay with the writer, who is free to option or sell the work to someone else, and the writer keeps the option fee that was paid. A well-drafted option confirms this reversion in clear terms, so that the writer gets the work back free of any continuing claim by the producer.

If you are a performer, producer, venue, or independent practitioner and this raises a question about your own situation, Aaron Kernaghan and the team at Brady & Associates Lawyers can give you tailored guidance. Call 0421 717 019 or contact the firm.

This article is for informational purposes and general commentary only. It does not constitute legal advice and does not create a solicitor-client relationship. It reflects the law in Australia as at 23 September 2026, with a focus on Commonwealth law and New South Wales and ACT practice. The law changes and applies differently to every set of facts. Written by Aaron Kernaghan, Brady & Associates Lawyers.

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