Lucas was contractually obliged to offer Star Wars first to United Artists, who passed, and then to Universal. This was just as American Graffiti was gearing for release and a nervous Universal was demanding cuts and rowing with the director. He was relieved to see them pass too.
Alan Ladd Jr., the head of creative affairs at Twentieth Century Fox, had seen a smuggled print of American Graffiti and believed in Lucas. “When he said, ‘This sequence is going to be like The Sea Hawk or this like Captain Blood or this like Flash Gordon,’ I knew exactly what he was saying,” the producer said.
Lucas signed a $150,000 deal to write and direct, plus – the crucial bit – retained full rights over Star Wars merchandising and sequels. Three weeks later American Graffiti became a huge hit and Lucas became a millionaire thanks to his share of revenues. He started to build his film empire - meanwhile, Star Wars was ready to roll.