I have a distribution deal in the works... need some guidance

HerzogisGod

HerzogisGod

Well-known member
I am currently in talks and a contract was emailed to me over the weekend.

Couple of questions:

According to what Im understanding as I read through the contract, it looks as if I need to be either a corporation or LLC. Is this absolutely necessary? I can certainly see the benefits and will file if I need to


It's a 15 page contract which basically gives the Distributor 10 year, worldwide exclusive rights at a 70/30 split -70 for me-. I have an option to opt out of contract after three years, beginning from the date of when the film is released if the company does not bring in a minimum of $50,000..

Is this normal?


Ive read the document several times and although most of it makes sense, some area are little murky particularly when it comes to the distribution of money and also my rights to opt of contract if they do not meet their end of the bargain after three years.due to my limited legal knowledge -I have none-

Should I just go ahead and hire an entertainment lawyer to at least read through it for me? they're a small company but they seem to be very enthusiastic and have already released several films and documentaries


Any help would be appreciated.

Thanks
Chris
 
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HerzogisGod said:
According to what Im understanding as I read through the contract, it looks as if I need to be either a corporation or LLC. Is this absolutely necessary? I can certainly see the benefits and will file if I need to
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It's not necessary. You can sell the movie as a private individual, but I would say it's wiser if you form a company.

HerzogisGod said:
It's a 15 page contract which basically gives the Distributor 10 year, worldwide exclusive rights at a 70/30 split -70 for me-. I have an option to opt out of contract after three years, beginning from the date of when the film is released if the company does not bring in a minimum of $50,000..
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Try to negotiate it to 7 years max. Most distribution deals are for 5-7 years.
Negotiate the performance guarantee to 6-12 months. After three years of them trying to sell your film out there, it won't be worth much.

Does the contract mention any promotional expenses? If it does, always try to negotiate a deal where you will start to see money from the very first sale, instead of it all going to cover the distributors promotional budget.

And yes, it would be wise to let an expert read through the contract.
 
Thanks

Can I become an LLC or corporation after I sign the contract and can this be applied to the contract?
 
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Hired an entertainment lawyer who is reviewing the contract. I also Incorporated and filed a copyright for the film. Only thing thing left if the contract looks good is to get producers E and O insurance
 
HerzogisGod said:
Hired an entertainment lawyer who is reviewing the contract. I also Incorporated and filed a copyright for the film. Only thing thing left if the contract looks good is to get producers E and O insurance
Click to expand...

Yeah, Herzog, at some point what level you're going to need advice on is way out of the realm for the forum. Sounds like you have it covered though.

Congrats on the distribution.
 
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Good call on the lawyer. The only thing I would say from what you listed there, is to know what their P&A caps are for both foreign and domestic, and also counter to have your worldwide split into 2 separate deals. The cap on foreign will be more than domestic, and you don't want the two to cannibalize one another. The movie could do well in the North America, but fall below expectations abroad, and they could use one to cover the other or vice versa. E&O is easy to find, but never cheap. Also be prepared for deliverable costs. My last flick was over $5000
 
I did some research and if half of what Im reading is true, there is no way I can cover the expense of "deliverables".
 
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My documentary film Tarology has been selling on its own for a few months now. I understand my sales and exposure may be peanuts next to what a good distributor might achieve
 
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Go to filmspecific.com for distribution questions. Lots of resources. There is some free stuff but it is a pay site. Check it out.
 
If you are at this stage I would recommend joining Film Specific for $25.00 bucks a month its worth it. That site is all about distribution and they have an active forum with members who have successfully gotten their films distributed.

http://www.filmspecific.com/
 
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