MMD guide lines for authors
If you are an author there are many different deals for payment for your work. We will try and outline here some possible scenarios, but we would recommend that you get professional advice before signing any contract.
Agreement between authors: First and foremost, if you are writing as part of a team (bookwriter, composer, lyricist) you must draw up an agreement between yourselves, as to how any income from the project is split between you,
before you start work. However friendly you are at the start of the project, things can happen later on and in order to prevent a lawsuit you need to get things sorted out before you start! The norm is for the income, either commissioning fees, advances or royalties to be split equally three ways, but there are some cases where one part of the team contributes more or less to the project. You need to determine this at the beginning and put it in writing, and all sign it! I would recommend that you also have provision in place at the beginning for the eventuality of one member of the team leaving the collaboration, or another person joining and how things would work in each eventuality. This is the equivalent of your pre-nuptial agreement! Once the show has been produced and is hopefully, a success, it is worth getting some legal advice about merged rights which will make any future productions, licensing for overseas, amateur and stock rights much easier.
Underlying rights: : If you are uncommissioned and if you are basing the show you are writing on a book, film, play or other source material that is not in the public domain, it is important that you secure the rights to this source material. It is really important to get some professional help in the contracting of this, in order to make sure that the rights are properly secured to your project, and cannot be licensed to another, rival, project, or a project in another medium at the same time as you are doing your own project. You also need to make sure that the rights are secured for all territories, so that if your show is a hit it can travel all over the world, and also in all media, so that you can exploit other areas for, for instance, merchandising if it is a hit. You would normally have to pay an option fee for securing these rights but charm, enthusiasm, and track record and sincerity can go a long way to reducing this payment - and it is good if you can build a relationship with the author and/or agent of the author for the underlying rights material. The norm is that a royalty is paid to the holder of the underlying rights, and this will probably affect the level of the authors' royalties as the producer will want the total authors' royalty package to be kept to a certain level. It is usually the responsibility of the authors to make sure that this royalty is paid to the underlying rights holder and indeed any advance on royalties which is paid up front to the holders of any underlying rights. In a major production the producers of the show will take care of such payments and it is the responsibility of the authors to inform the producers of the underlying rights deal. Sometimes it is quite tricky to discover who actually holds the underlying rights (especially if the project is based on a film, which in turn has been based on a book, for instance) but it is really important to do this exercise and not just spend time on writing the show and hoping to sort out the underlying rights at a later date. This can provide difficult and expensive, and in some cases you may not get the rights and have wasted your time writing the show.
Royalties and Royalty pools: How much authors get paid is a subject of negotiation - once you begin to get projects I would recommend you get a good agent or lawyer to do this for you! You may feel that you do not want to pay fees or commissions out of your share, but in the long run it will benefit you to get good negotiators to do this for you, and we can assure you that in the long run you will get more money by doing it this way, than by negotiating for yourselves. It is a false economy not to use professionals. Agents usually charge on a commission basis (rate usually between 10% and 15% depending upon the media concerned, theatre, film, TV). They will usually more than earn their commission in getting you better deals and enhanced fees and royalties. Lawyers usually charge hourly rates, but you
can negotiate with them to set a specific fee for a particular job, and some will also be prepared to discuss a commission basis deal but this is not usual. In the past it was a rule of thumb that the royalty split for authors was usually 2% to the book writer, 2% to the lyricist and 2% to the composer. This was traditionally paid as a percentage of the weekly box office takings. In the current climate most commercial shows work on a royalty pool basis. Essentially how a royalty pool works is that each week the fixed running costs of the show are paid from the box office takings and the balance left is split between the royalty holders and the investors. Each royalty holder gets a number of 'points' in the pool and the amount going to the royalty holders is split amongst them depending upon how many points they have in the pool. The royalty pool usually includes the authors, the director, designers (set, costume, lighting, sound), producers and there may be others. So, as an example, if the total number of points in the pool is 20, and the authors get 5 points in the pool, they would get one quarter (5/20) of the amount going to the royalty pool each week. The split of the weekly profit between the investors and royalty holders again is a matter for negotiation on each show but the norm is between 25% and 35% going to the royalty holders and the balance to the investors. This split may change after recoupment of production costs usually in favour of the creative team. This is done so that the investors begin to get a return from the beginning, and also in weeks when the box office is not large, as over the years with the costs of shows rising dramatically, it has been important to make investing more attractive in order to raise the money to do the show. There will also be a minimum sum, per royalty point, agreed that will be payable to the royalty holders, including authors, in those weeks in which no profits are made, and therefore no money available for distribution in a royalty pool. Royalties and royalty pools are a complicated area and we are more than happy to give a more detailed explanation if required.
It is also important to get these sorted early, as if the show is written the underlying rights author, or his agent, may demand a substantial royalty, if they see that the show has a chance of being a great success. If you negotiate before it is written, you have better negotiating power. There are examples of shows in the current climate where underlying rights authors have demanded up to 50% of the authors royalties, for essentially doing nothing - this is an extreme case and hopefully not the norm. But be warned!
4. Different kinds of theatres and productions:
There are a number of different scenarios where you may be offered the opportunity of a production of your work, and the rewards, and deals from each kind of performance are different. We will try to outline herewith a number of potential options, which will give you an overview of the most common.
A: Fringe: Usually the starting place for many shows. Depending upon whether the fringe theatre has approached you, or whether you have made the contact direct, the production at a fringe venue will necessarily be one which does not attract much income for either the authors or indeed the performers. Some more reputable fringe theatres may pay the authors a small fee, or royalty, but most will be profit share venues and the author will not get anything for the production. The reasons for doing the show at a fringe venue are to get it seen, by producers, and critics, and hopefully to lead to a larger, commercial production. It is important, however, to be careful in contracting with a fringe venue not to tie up rights, or indeed future rights, in a way which will prevent or inhibit future production, or other producers wanting to take the show on. If the fringe venue asks for an ongoing right in the show after the production at the fringe venue, it is important to be careful in these discussions and get proper advice before agreeing anything.
B: Regional theatre/subsidised theatre production: These productions will be better funded and you would probably be offered a contract with an upfront payment as an advance against royalties and a proper royalty payment. The Writers guild has standard agreements with the TMA (representing regional venues and touring producers), subsidised venues (such as the National Theatre, Almeida and Royal Court) and with the ITC( representing the smaller scale venues and touring producers) These contracts cover minimum payments, royalties etc, but are not specifically drafted for musicals, so additional advice should be sought. These contracts can be viewed on the Writers Guild website. You should however not expect a substantial sum from such a production, but you will probably get a better and more professional production than in a fringe theatre, and also the opportunity for the show to be seen by critics and commercial producers.
C: Festivals: There are a number of new musical festivals (NAMT, NYMT) which give a good exposure for new shows. These do not pay anything for the authors, and indeed in some cases the authors are required to find the money (or at least a contribution) to getting the show on. They again provide exposure for the show.
D: Compilation shows: There are a number of opportunities for one or more songs, or excerpts from your show, to be included in compilation shows which are currently being produced by organisations, such as MMD, in order to bring your work to the notice of those in the industry. In most cases, such a show will have a collaborative agreement drawn up specifically for that show for the authors to sign.
D: Compilation shows: There are a number of opportunities for one or more songs, or excerpts from your show, to be included in compilation shows which are currently being produced by organisations, such as MMD, in order to bring your work to the notice of those in the industry. In most cases, such a show will have a collaborative agreement drawn up specifically for that show for the authors to sign.
E: Commercial production: When your show is optioned for a commercial production, we recommend you get an agent or lawyer to negotiate the contract: Same comments as above about the benefits of getting professional advice! The following areas need to be carefully protected!
i: Option payments and royalties: You will normally be paid an option payment on signature of
the agreement with the commercial producer. This may be an advance on royalties, in which case, once the show is running the royalties for the first few weeks will be set against this figure. Option payments can cover a large range depending upon the status of the authors, the size of the production, where it is taking place, etc. As discussed above the royalty agreed may be subject to a royalty pool. The norm is that all the creatives who are included in the pool are on the same terms (known as favoured nations) and it is important that this is agreed at the outset. The authors' contract is the first to be negotiated so it is important that this is stated within the negotiations for your contract.
ii: Approvals: Authors can negotiate approvals of various areas of the production,
usually covering the appointment of the creative team, casting, theatre choice etc. Again this will be the subject of negotiation in the contract, but we would advise that it is normal for the authors to have approval certainly of the director, and other members of the creative team, such approvals not to be unreasonably withheld. Any good producer will want his author and creatives to work well together so will make sure that everyone meets, and gets on, before creatives are appointed.
iii. You should always make sure that any agreement with a venue or producer includes a clause that should they wish to make any changes at all to your work, these can only be made with the author's consent.
iv: Future productions: Within the option agreement with the producer he or she will have the
right to produce further productions, as long as the original production goes according to plan. The norm is that as long as the initial production runs for a certain number of performances, he or she can have the right to purchase the options for further territories. If the show is not successful of course and does not run the required number of performances, then the initial producer cannot tie up the rights for the future and these rights will revert to the authors. The option for the further territories is usually a percentage of the original option fee, and again can be an advance on royalties. Any rights and approvals you have agreed for the initial production will carry over to any future productions. In addition, if the show is successful, and runs for a certain amount of time, the initial producers will get a percentage of what are called secondary rights, which are the royalties you will get paid when the show is licensed out for amateur and other productions in years to come.
v: Rehearsals: it is usual for authors to be able to attend rehearsals at the directors' request.
For a new show it is essential that the authors are involved in the creative process and are available for rewrites and discussion as needed. However, from the director and producer perspective, we would add a word of advice here - there are times the director and cast need to be left alone to try things out in a closed rehearsal room and then show to the authors and producers, when they have worked on areas of the show. These times can get fraught, but whilst you have written the piece and obviously feel protective and strongly about what you have written, it is essential that you trust the creatives to do the best for your work, and listen to their suggestions. This is why it is important that you work with a director that you get on with and trust to do the best by your work and are able to discuss rationally thoughts, suggestions and options. In commercial productions authors are not paid to attend rehearsals, this is part of the fee, but in subsidised theatre there is a rehearsal payment.
vi: House seats, visits to productions, first nights, billing etc. Obviously in the contract will be
laid out your entitlement to seats for the press nights of the various productions, including travel to and accommodation at the various cities where the show is performing, your house seat entitlement, and your billing. These will all depend upon the actual production and the various elements involved, but again a reputable agent or lawyer will advise you of the norm in each case. As a norm you will probably be given a pair of seats for free for the opening night of each production and access to one or two pairs of house seats (to be paid for) for each performance. You will probably get travel and accommodation to the first night of productions not in your home territory, and also travel and accommodation if you are requested to be at rehearsals not in your home territory. As far as billing is concerned, it is usual for the authors to be billed immediately after the title of the show. If there are underlying rights there may be other authors billed wherever you, the authors are billed. The producers will probably ask, and it is usual, for them to be able to have some publicity with just the name of the show, and possibly just the name of the star (if his or her name is a 'selling' name) without any billing on at all, but you will always be billed whenever there is any billing at all. Again a good agent or lawyer will advise you on this.
You should also refer to the Writers Guild Guidelines for more detail on agreements, but please be aware that these Guidelines do not cover productions in fringe venues.
We hope that these guidelines will give you some initial assistance in outlining the various kinds of productions that are possible, but this is not an exclusive list and there may be other permutations of what we have outlined above. We cannot stress enough our recommendation that you get professional advice from an agent or lawyer from the outset - we promise you that any cost of same will benefit you in the end!
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