Posted by: Kathy Temean | February 22, 2010

Book Contract Basics

Contract Basics  

Presented by Edward Necarsulmer IV, McIntosh & Otis, Inc. on January 30th 2010.

Advance Against Royalties  or  SHOW ME THE MONEY –  Upfront money publisher pays author for the right to buy a literary Property.

Track Record/Earning Out  or HOW DID MY BABY DO? – Did previous books sell enough copies to cover their advances? 

Grant of Rights/Territory/Work for Hire or MY WRITING SOUNDS BETTER IN KOREAN! – States where a publisher is allowed to sell your book and your relationship to the work.

Manuscript Delivery or DEADLINES  –  When is your manuscript due?

Payout Structure or WHERE IS MY MONEY? –  The schedule in which the advance will be paid.

Royalty Rate (Hard, Soft, Mass, Board Books, etc.) or IT’S FLYING OFF THE SHELVES…  – Royalties are how the advance is earned out.  For each copy sold, the author earns a percentage of the price.  The amount he earns changes depending on how many copies and edition of the book was sold.

Escalation/Slide or AND NOW I’M GOING TO BE RICH!  –  The percentage a publisher pays usually increases after a book has sold a certain amount of the copies.

Joint/Separate Accounting  or  MIGHTIER APART THAN TOGETHER  –  If there are two books in the contract, will they both have to earn back their advances before royalties can be paid?  Are they counted together or apart?

Subsidiary Rights or ICING ON THE CAKE  –  Additional right such as audio rights and foreign rights that can either be granted to publisher or author.  Publishers traditionally shares in any profits made from subsidiary rights.

Flow Through  or  THE EXPRESS LANE  –  A clause that ensures payment of subsidiary rights income is paid as it is received by the Publisher, instead of waiting for bi-annual royalty statements.

Royalty Statements/Unearned Statements  or  I’VE ARRIVED!  –  Issued twice annually these statements are your report card from the Publisher calculating your number of units sold at the each royalty rate.

Copyright  or  YOUR FRIEND, THE ‘C’ IN A CIRCLE  –  Your publisher will register the title, year of first publication and the name of the copyright owner with the U.S. COPYRIGHT OFFICE, although copyright protection actually begins the moment your pen touches the paper.

Jacket/Cover Consultation  or  PUT ON YOUR BERET!  –  A clause in an agreement stipulating a good will exchange between Author and Publisher when designing the dust jacket or cover art.

Out of Print  or  PREPARING FOR RETIREMENT  –  Enough said.

Option Clause  or TO BE OR NOT TO BE A FREE AGENT?  – no explanation from Edward.

Bonus Language  or  PROTECTING FOR SUCESS  – My comment:  This is where you really need an agent.  Edward whipped though 32 things that he tries to get in the contract that you or I would never think of, but could make a big difference in the outcome of your book.

GENERAL:  Avoid vague language, Reserved rights, Right to audit





Now and hereinafter devised

Derivative works

Force Majeure –  Literally means “greater force“. These clauses excuse a party from liability if some unforeseen event beyond the control of that party prevents it from performing its obligations under the contract.

Edward is fantastic.  I think everyone who meets him wants him as their agent.  After listening to him, you realize why you want to have an agent.  Hope you found the highlights of what he presented valuable.  Tried to get him for our June conference, but he couldn’t make it.  We are going to try for the fall.



  1. Thanks for sharing this! This is the clearest “translation” of all that lingo that I’ve seen to date!

    – Liz


    • Liz,

      Thanks. Edward gave a very good workshop. I am going to have to try and get him to do it again for a workshop or conference and have him repeat it. He couldn’t make it this year.



  2. thanks Kathy!


  3. Nice and concise! 🙂 I can tell you one thing—I KNOW I want and need an agent. It’s a matter of an agent wanting and needing ME! lol


    • Donna,

      I’m in the same boat with you. I love Edward, but then I am not the only one who does.



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.


%d bloggers like this: