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What is standard for a contract to make a derivative work and sell it?

I want to make an arrangement of a work that is still under copyright and then want to sell the arrangement through my own self-publishing company.  I just received a contract from the publisher (after trying for over a year!) and because I haven't really done this before, I was wondering if what I'm receiving is standard for these types of agreements or not.  Here is some of what the contract stipulates:
-I would be granted the nonexlusive right to sell the sheet music at my expense throughout the USA and Canada and pay 25% of the sales to the publisher (copyright holder).
-The arrangement will be created as the result of a "Work-Made-For-Hire" and the publisher will still own the original copyright and is entitled to any royalties generated from performance of the arrangement.  I must also send them two complimentary copies of the score and any recordings that are made.  
-The agreement is valid for 5 years.
I think most of this make sense and is agreeable to me, but my biggest concern here is that if I have the nonexlusive right to sell this arrangement and I am sending them complimentary copies, they could easily publish the arrangement too, and as they are, in this case, a big and well-known publishing company with lots of resources, that could steal all my potential business and have received a great arrangement and sell it without having had to pay me at all for creating it.  Might it be a possibilty to say to them that I will not ask for the right to publish and sell the sheet music if they will pay me a satisfactory amount for the creation of the arrangement itself instead?
Also, as I would be selling the sheet music through my website online, would I have to turn down sales from people oustide the USA and Canada?  Should I ask that the clause in the contract be changed to say "worldwide" instead of "USA and Canada only"?
Anyone who has any experience with these matters, please let me know your thoughts and experiences.  I greatly appreciate it.
on December 13, 2014 2:55am
Dear Keane:
While I don't have EXTENSIVE history in this area, the two arrangement/transcriptions that we publish for concert band involve similar verbiage and terms. We, too, are restricted to sales in the USA and Canada, but instead of paying 25% royalties on our sales, we paid lump sums in advance - now all we need to do is sell 50 copies of one title and 20 of the other!  :-)  Like you, we were concerned that the publishers would run off with our titles and sell our arrangements without compensating us - especially to clients abroad - and there's no way to know if that's what they're doing!?  But in both cases, the titles were "an itch that needed to be scratched" for us - and the hassles involved in getting permission have persuaded us to only publish our own original material in the future!  Good luck!!
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on December 15, 2014 6:32am
I recently read an article on this that helped to put dealing with derivative works into a very simple kind of explanation. 
In many ways the owner of the copyright of a song is like the owner of a car. Someone may come along and want to paint the car, repair the fenders, put in a sunroof, and maybe even greatly increase the value of the car, but they still don't own the car. The owner of the car would have to agree to split the value of the car with the painter for the person painting the car to get anything out of it. Should the owner decide to do that, or to pay the person painting the car, then the painter gets something out of it. 
Most composers arranging a copyrighted tune assume that they will get something from it before asking the permission of the copyright owner. The copyright owner does not have to share any income off of the sale of their tune in any way if they do not agree to up front. 
Before making any kind of derivative work, I would suggest you go to the copyright holder first and find out terms, or if they will even allow the publication of the arrangement. 
This is just the way the law reads. I have also found many composers are reluctant to allow derivative works to be made of their compositions or tunes, so publishers often uphold the wishes and contract obligations with those composers and refuse to allow derivative works. 
I hope this helps. 
Mark Lawson
ECS Publishing
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