The unusual deal settles a 13-year lawsuit brought by two of the former president's bodyguards and his press secretary, James Brady, who were wounded when Hinckley opened fire on Mr Reagan outside the Washington Hilton hotel in March 1981. Mr Brady is confined to a wheelchair.
According to lawyers, Hinckley, 35, signed the agreement this week at the Washington mental hospital where he has been kept since being found not guilty by virtue of insanity. It provides for 80 per cent of the first $3.6m of any revenue go to his victims. The rest would be in trust for Hinckley, who can be released only if a judge deems him no longer a threat to public safety.
Mr Brady and the two bodyguards plan to offer the rights to publishers and film-makers, although what interest the story will generate is unclear. The "musical" works of Hinckley involve the rock 'n' roll lyrics he wrote in recent years. "He's quite talented," said Frederick Schwartz, Mr Brady's lawyer.
Hinckley said he committed the crime to try to impress the actress Jodie Foster, with whom he was obsessed. The attack subsequently became a prime argument for gun-control.