Termination Clause - always a bad thing?

No, it is not reasonable.

An advance is exactly that. it's an advance payment of anticipated royalties on the book. The publisher should have done a profit and loss analysis and determined what exactly they should have made on your book If you exceed that, fantastic, you and the publisher make even more money (and you get more royalties!)

However, if they misfigure, or the market goes south or whatever, that advance is yours. You do not have to repay that to any legitimate publisher.

So, yes, there's no way I'd sign that contract as written. You can try and strike it out and see if they'll accept it IF you're that sure this is the publisher for you. If it was me? I'd start looking for a better publisher who understands the business better.

Which publisher is this, btw? Did you check to see if there's a thread in the Bewares, Recommendations, and Background Check forum?

Edit:

Also, termination fees in general are predatory. If they can't make money on your book (and therefore you're not making money on the book), why should you have to give them any money to get your rights back? They are the business people who made a business decision to take on your book. You should not have to pay them money ever. No reading fees, no submission fees, and definitely no termination fees.

Money flows to the author.

If you fulfill the terms of the contract—you turn in the ms. and the publisher accepts it as complete, the advance is yours to keep.

http://absolutewrite.com/forums/sho...-Terminology&p=9738690&viewfull=1#post9738690

[Publishing Myth] Returning an Advance if Book Doesn't Sell

OK, then two different things are worrying me.

1) If there's no advance, why does the termination fee language even bring up an advance?

2) While contracts should have a reversion clause (whether that's X years or Y number of sales in a year) to return the rights to the author, the whole "If you get an offer from a bigger publisher" really worries me. No legitimate publisher should talk to you about your book as long as your under contract with another publisher. You can't offer them the rights (you don't have them) and they can't approach you for the rights (you don't have them). So, they're setting up a potential termination fee (and how they figure out how much you "owe" them is still vague), for a situation that really can't happen without them being involved from the beginning. And I'm pretty darn sure if another publisher approached you about your book without going through them, there'd be lawyers on speed-dial.

AND if I was a small publisher, and S&S wanted to approach me about the rights for your book, I'd be sure to get my cut of that from S&S, not from you (they've got bigger pockets).

Even mentioning repayment of advance is super-bizarre even if it is unlikely to actually happen. Advances are never repaid if the author delivers the manuscript as promised. It's like they are trying to breathe life into an old self-pub myth for some weird reason.

Termination clauses can't be read separately from the rest of the contract, as they are affected by other clauses in the contract. But it's not reasonable for a publisher to expect an author to buy themselves out of a contract, nor is it reasonable for the author to return an advance if they deliver a publishable manuscript within deadline. There should be a rights reversion clause, which specifies the circumstances under which the rights will revert to the author: but that is usually triggered by sales falling below a certain point, and it's never really dealt with by money changing hands. I would be very wary of this publisher.