Book Contract Basics

All The Clauses of a Book Contract Explained

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In addition to the specific terms the author and publisher have agreed upon for such items as the type of book, the advance against royalty amount, and the delivery date, the standard book contract encompasses a lengthy number of clauses covering important points in a book's life cycle and an author's compensation. While exact wording and terms vary by publisher, by imprint, and by individual deals, many of the topics addressed by the contract are standard.

What follows is a list of the typical clauses of a book contract, along with brief descriptions as to their purpose.

The Work 

The nuts and bolts of the manuscript to be delivered: "a novel of approximately 40,000 words"; "a cookbook with 100 recipes and 50 color photographs." 

Description of the Work 

Further details describing the agreed-upon content: "a mystery novel in the Spooky Attic series, featuring the character Detective Dusty"; "recipes for everyday family-friendly dishes that take no more than 15 minutes to cook."

Grant of Rights: Territories

Generally specifies that the publishers is to get world or global rights to any and all editions of the work for the duration of the copyright (currently, the author's life plus 70 years). 

Advance Against Royalties

Outlines the payment schedule for the upfront monies given to the author.

Delivery and Acceptance of Manuscript

Details delivery dates of the full text of the book, penalties or out clauses if the manuscript isn't delivered, etc.

Proofreading and Author's Corrections

Outlines the extent of changes once the book goes into copyediting/production; usually intended to curtail any extensive (and expensive) editorial amendments.

Publication

Concerns the publisher's obligations to bring the book to market within a certain timeframe. 

Promotional Materials / Promotion by Author

Concerns the author's obligations to promote and publicize the book (cooperation, use of promotional materials/photos, etc.) For high-profile authors, this clause sometimes includes a guarantee to actively appear and promote the book for a certain amount of time (say, two weeks).

Author Copies

Authors are usually contractually entitled to a limited amount of free copies of their book, usually 20 to 25, and then allowed to purchase additional copies at a discount (generally 50% of the cover price). Note that many contracts stipulate these copies are for personal use and explicitly not for resale. If you're an author who intends to sell your book on your own (say, at readings or book signings that you arrange), make sure to negotiate this point to come to a different resale agreement.

Copyright

Dictates how the copyright notice should appear. It should be in the author's name, not the publisher's.

Royalties

Generally, a long and complex section that deals with the percentage of book-related sales the author will receive. It outlines the rates and the terms. Any traditionally published author will be earning different royalty rates for different types of book sales and subsidiary rights sales.

Any compensation given to the author before the book comes out is also indicated here; it is known as an advance against royalties, or simply an advance.

Subsidiary Rights

Another extensive portion of the contract, subsidiary rights refer to the rights the author grants the publisher to sub-license his book ("the work") for various formats and adaptations in addition to the original one (usually, a hardcover book). The clause specifies which subsidiary rights that are being granted by the agreement, and also outlines the percentage of the sub-license fees received by the publisher (from the third-party licensor) that will go to the author.

Settlements of Accounts

Concerns the accounting of royalties, the timing of payments and royalty statements, etc.

Competitive Works

Prevents the author from writing a competitive work for another publisher at the time of the book's publication. 

Warranties and Indemnities

Guarantees concerning the authorship of the work, that the work isn't libelous, etc. 

Original Work

Concerns the trafficking of original materials and any reparations made for lost or damaged original work. 

Inserts, Back of Book Advertising

Prevents the publisher from selling any part of the book for advertising space. 

Next Publication of Author's Work 

Stipulates that the book contracted will be the latest work of the author (i.e., she won't publish something else before it comes out). 

Option (For Subsequent Work)

Outlines the publisher's first right of refusal for the author's future work. 

Out of Print 

Dictates the reversion of rights to the author if the publisher decides to cease publishing new editions of the work, letting it go out of print. 

Remainders

Dictates procedure to remaining copies of the work, if the publisher decides to no longer keep the book in print.

Governing Law

Dictates which state's laws govern the contract agreement.

Assignment 

Covers third parties, like heirs, executors, etc. to whom rights and royalties go in case of the author's death.

Agency

Gives the author's literary agent the right to act on behalf of the author and the work with the publisher. 

Reserved Rights

Assigns any rights not explicitly stated in the contract to the author. 

Bankruptcy

Details what happens in the event the publisher goes out of business or declares bankruptcy. 

Full Agreement

The section for signatures for all parties.
Disclaimer: This article is not a substitute for authoritative legal advice. If you are negotiating a book contract, you should seek the counsel of a literary agent and/or an attorney. The Author's Guild has a contract review service for members.