PRODUCTION FINANCING AGREEMENT
ABILITY FILMS, LLC – NORMA’S SUN
Ability Films, LLC, a Georgia limited liability company, (“Production Company”) and (“Financier”). The parties may be individually referred to herein as “Party,” or collectively referred to as “Parties.”
1. Production Company and Financier wish to develop, produce, and exploit a
feature-length DRAMA motion picture currently titled NORMA’S SUN.
2. Financier desires to provide a portion of the financing in increments in the amount of $_________ in the $3,500,000 total cash production costs (“Budget” or the “Financing”) for the picture.
Financier’s total contribution will be $____________
For and in consideration of the mutual covenants herein set forth, the parties hereby agree
1. PICTURE: Production Company owns or controls the right to produce and exploit the
properties (each a “Picture” and collectively the “Pictures”) identified on Schedule “A” hereof.
(a) Budget: With respect to the Picture, the term “Budget” shall be the cash, “going
in” budget that Production Company believes is sufficient to produce the applicable Picture. The Budget for the Picture shall not exceed the amount set forth for such Picture on Schedule A, to include a seven percent contingency for Budget Overages (the “Contingency”). Budget Overages in excess of the Contingency shall be governed according to 4(c), below.
3. TERM: The term of this agreement shall commence on the date set forth in the caption
of this Agreement and shall continue until completion and delivery to the Distributor of the
Picture produced hereunder.
(1) The “Financing” shall be defined as set forth in Paragraph 4(a).
(2) “Financing Group’” shall be defined collectively as Financier and all
individuals, entities, groups of individuals, groups of entities, or combination thereof that fund the applicable Picture’s Budget.
(3) “Gross Producer Revenues” shall be defined as (i) all “Net Proceeds” (as
defined in Paragraph 6(e) of the Distribution Agreement) received by Production Company from Distributor as a result of exploitation of the applicable Picture, or (ii) all revenues from any other source that is attributable to the production and exploitation of the applicable Picture.
(4) “Recoupment” shall be defined as the point where the Financing Group
has received compensation equal to the amount of the Financing plus 10% for the applicable Picture. “Recoupment Account” shall be defined as the amount of compensation owing to Financier (and each member of the Financing Group and any Over-Budget Financier, as defined in Paragraph 4(c)(2), shall each have its own Recoupment Account) for the applicable Picture. Financier’s Recoupment Account for the applicable Picture shall be reduced by distributions of
Distributable Cash or other payments made to Financier as set forth in this
(5) “Deferment” shall be defined as a fixed non-recurring payment earned by
an individual who has rendered services in connection with production of a Picture, but not payable unless and until a certain triggering event set forth in the recipient’s contract occurs.
(6) “Participation” shall be defined as contingent compensation for certain
individuals who have assigned rights or rendered services in connection with production of a Picture, which is earned and payable, if ever, only after revenues resulting from exploitation of the Picture reach certain thresholds set forth in the participant’s contractually defined formula.
(7) “Distributable Cash” means the sum of all cash receipts from the
Distributor and any and all other sources resulting from exploitation of the applicable Picture, less all cash disbursements (including loan repayments, applicable Participations, and applicable Deferments) and a reasonable allowance for reserves (not to exceed 25%), contingencies, and anticipated obligations as determined by the parties’ mutual agreement. For the avoidance of doubt, Distributable Cash is not intended to include the Distributor’s receipts.
(8) With respect to each Picture, the Parties’ shares of “Gross Producer
Revenues after Recoupment” (individually, the “Party’s Share”) shall be as follows:
(i) “Financier’s Share” shall be equal to 50% of Gross Producer Revenues after Recoupment.
(ii) “Production Company’s Share” shall be defined as 50% less the
percentage share provided to any of other members of the Financing Group. Production Company shall have the right to allocate Production Company’s Share of Gross Producer Revenues after Recoupment to other financiers and third parties who have performed services in connection with producing the Picture in Production Company’s discretion.
(iii) For the avoidance of doubt, irrespective of the term and/or
termination of this Agreement, each Party’s Share of the applicable Picture shall continue in perpetuity, unless the applicable Party’s Share has been sold, hypothecated, assigned, pledged, or otherwise transferred to a third party by such Party.
(9) Overage Share shall be defined as an adjustment to Production Company’s
Share or Financier’s Share resulting from the applicable Party—or a third-party’s—contribution of additional funds as a result of Budget Overages, as defined in Paragraph 4(c)(1), in excess of the Contingency for the applicable Picture. The Party contributing the funds shall be entitled to an Overage Share, which shall be determined by a ratio the numerator of which is the amount of funds contributed and the denominator of which is the sum of the Budget for the applicable
Picture plus all Budget Overages for that Picture. The non-contributing Party or Parties’ share(s) shall be reduced by an amount equal to the ratio multiplied by 100, and the contributing Party or Third Party’s shall be increased by that same product.
(b) Distributions of Gross Producer Revenues: Production Company, or its assignee or designee, shall cause Distributable Cash for each Picture to be distributed quarterly for the first two years after the Picture’s delivery to Distributor. After the second year, distributions shall be made semi-annually, or more frequently as Production Company may determine (but not more frequently than once per quarter) in its sole and absolute discretion as set forth below.
(1) All Distributable Cash for the applicable Picture shall first be distributed
pari passu to the Financing Group until Recoupment. The Financier’s pro rata
share of such distributions shall be the ratio that the balance of Financier’s Recoupment Account bears to the sum of the entire Financing Group’s Recoupment Accounts (including Financier’s). All distributions to Financier under this Paragraph shall be applied to reduce Financier’s
Recoupment Account for the applicable Picture.
(2) After Recoupment, all remaining Distributable Cash for the applicable
Picture shall be distributed pari passu in accordance with the Party’s Share,
including any additional Overage Share, if applicable.
(1) Production Company shall render or cause to be rendered to Financier
accounting statements along with the distributions of Gross Producer Revenues as set forth in Paragraph 3(b) commencing sixty (60) days after the first quarter after the initial release of the applicable Picture. Financier will be deemed to have consented to all accountings rendered by Production Company or its assignees, or successors, and all such statements will be binding upon Production Company unless specific objections in writing, stating the basis thereof, are given by Financier within two (2) years of receiving such statement.
(2) Financier may, at Financier’s own expense, directly audit Production
Company’s and Distributor’s books and records relating to this agreement
that report the exploitation of the applicable Picture. Financier may make such audit only for the purpose of verifying the accuracy of statements sent to Financier or Financier hereunder and only as provided herein. Financier shall have the right to audit said books by notice to Production Company and Distributor at least thirty (30) days prior to the date Financier intends to
commence the audit. Said audit shall be conducted by an attorney or CPA in such a manner so as not to disrupt Production Company’s other functions, and shall be completed promptly. Financier may make such an examination for any particular statement only once and only within
two (2) years after the date of any such statement is due as provided above. Any such audit shall be conducted only during Production Company’s usual business hours and at the place where it keeps the books and records to be examined. Financier’s auditor shall review his tentative
findings with a member of Production Company’s staff designated and made
available by Production Company before rendering a report to Financier so
as to remedy any factual errors and clarify any issues that may have resulted from misunderstanding. Production Company agrees that the staff member shall be available to meet with Financier’s auditor no later than
three (3) business days after Financier’s request to meet; however, Financier shall reasonably accommodate Production Company’s request for extensions of time based on Production Company’s good faith business requirements and/or circumstances. In the event that the audit discloses errors or omissions amounting to a difference in Financier’s favor of five percent (5%)
or greater, with respect to the particular statements at issue in the audit, then
Production Company shall pay the reasonable costs of such audit up to $25,000.
5. FINANCING THE PICTURE:
(a) Financing: Financier shall provide $_________ (the “Financing”) to Production
Company. The entirety of the Financing shall be used to fund a portion of the $3,500,000 Budget of the Picture. The Financing shall be provided to Production Company immediately upon execution of this Agreement. Production Company guarantees sufficient financing to complete and deliver the Picture to Distributor.
(1) To secure the Financing, Production Company shall execute and deliver to Financier the following documents for each Picture (all of which, collectively, are referred to herein as the “Collateral Documents”): (a) Security Agreement, (b) Copyright Mortgage, (c) Lab Pledgeholder Agreement, (d) Assignment of Rights, and (e) Letter of Direction. Production
Company shall also prepare and file a UCC-1 on behalf of Financier with the
California Secretary of State and in any other state in the United States where the applicable Picture is being physically produced. All such Collateral Documents and UCC-1 Financing Statements shall be delivered to Financier contemporaneously with the Financier’s deposit of the Financing. The form of the Collateral Documents are attached hereto as Exhibit “B” and incorporated herein.
(2) Production Company hereby confirms and states that all of the foregoing
Collateral Documents shall secure Financing.
(3) Upon Financier’s Recoupment of the Financing for the applicable Picture,
Financier will release or terminate all Collateral Documents for such Picture (e.g., send written notice to any labs who have executed a Lab Pledgeholder Agreement; file any appropriate documents as shall be reasonable to be filed with the Copyright Office to terminate all of Financier’s rights under the Copyright Mortgage; etc.) using forms satisfactory to Production Company. The approved form release documents are attached hereto as Exhibit “C” and incorporated herein.
(c) Budget Overages:
(1) A “Budget Overage” shall be defined as a reasonable expectation by
Production Company that the cash production costs and expenses for the applicable Picture shall exceed the Budget. Any additional production costs for a Budget Overage will be the sole responsibility of the Production Company.
(2) A “non-negligent Budget Overage” shall be defined as a Budget Overage
in excess of the Contingency resulting from (i) enhanced elements for the applicable Picture that are mutually agreed upon by Production Company and Financier, (ii) cost increases outside the control of Production Company, (iii) force majeure, (iv) production suspensions, or (v) any other increase not caused by the negligence of Production Company. An Over-Budget Financier shall be defined as any individual or entity that furnishes funding for a non-negligent Budget Overage, which Over-Budget Financier is approved by Production Company and Financier.
(3) Financier and Production Company shall mutually approve any
non-negligent Budget Overage in advance of the occurrence of such non-negligent Budget Overage, unless the exigencies of production render such advance approval impracticable, in which case, within a reasonable time after such non-negligent Budget Overage. All other Budget Overages shall be the responsibility of Production Company.
(d) Interest: Interest actually accruing in connection depositing the cash for the
applicable Picture’s Budget in a bank or other financial institution—and which interest is not used to finance the Budget of such Picture—shall be distributed to the Financing Group as set forth in Paragraph 3 and shall be applied to reduce Financier’s Recoupment Account.
(e) Production Tax Credits: Prior to Recoupment for the applicable Picture, any
cash production tax credits, refunds, or rebates actually received by Production Company—and not used to finance the Budget of that Picture—resulting from federal, state, or international production tax incentives shall be distributed to Financier and shall be applied to reduce Financier’s Recoupment Account.
(f) Budget Underage: A Picture’s Budget Underage (which shall mean that the cash
production costs and expenses for the Picture are less than the Picture’s Budget), if any, shall be distributed to the Financing Group as set forth in Paragraph 3 and shall be applied to reduce Financier’s (and all other members of the Financing Group’s) Recoupment Account for the Picture.
6. PRODUCTION OF THE PICTURE: Production Company shall render services as the
producer of each Picture produced under this Agreement. Production Company’s production
services shall be governed by the following.
(a) Engagement: Production Company shall render all services customarily rendered by producers in the U.S. motion picture industry on first class U.S. motion pictures in connection with the pre-production, production, and post-production of each Picture. Production Company’s services as producer for the applicable Picture shall commence on a date to be designated by the Parties and shall continue through delivery of the completed Picture. Production Company agrees to produce each Picture within the Picture’s Budget, subject only to variations mutually agreed by the Parties to this Agreement.
(b) Individual Producers: Production Company, as lender, shall provide the services
of any persons it deems necessary or convenient as the individual producers (“Producers”) for the Picture. For the sake of clarity, Production Company may, but is not required to, provide the services of more than one such individual for the Picture. The Producers shall render their services for and as directed by Production Company in accordance with this agreement for the period of time required for pre-production, principal photography and post-production of each Picture.
(c) Exclusivity: The Producers’ production services on the applicable Picture shall be rendered on an exclusive basis during pre-production and principal photography and on a non-exclusive, first priority basis at all other times hereunder.
(d) Decisions: Production Company shall have the discretion to make such decisions and enter into such agreements that are typically entered into by producers during the course of production of motion pictures, provided that the terms of all such decisions, commitments, and agreement are in accordance with the Picture’s Budget and the approvals set forth in the Schedule.
(e) Errors & Omissions Insurance: Production Company shall obtain General
Liability and Producer’s Errors & Omission Insurance (“E&O”) coverages in amounts
appropriate amounts for the production of the Picture. The cost of the insurance policies required in this section shall be included in the Budget for the applicable Picture. E&O coverage shall not be less than $1 million per occurrence / $3 million aggregate per Picture, with a retention of not more than $25,000, coverage to remain in effect for at least three years. Production Company shall name Financier as an additional insured on the policy. Should there be an additional charge, Production Company shall notify Financier and request Financier to cover the additional
cost of the premium or waive Financier’s right to be named as an additional insured.
(f) Other Insurance: Production Company shall obtain and maintain general
liability and motion picture insurance as is customary in the United States motion picture industry, with policy limits, deductibles, and other terms and conditions in Production Company’s discretion.
(g) No Completion Bond Requirement: No completion bond shall be required.
7. APPROVALS AND SELECTIONS:
(a) Approvals: Production Company shall approve each of the following elements:
Budget, cash flow schedule, insurance, Participations that are not “off the top” (as defined in Paragraph 3(a)(6)), writers, director, principal cast, final approved screenplay, credits, breakdown, pre-production schedules, production schedules, post-production schedules, locations for shooting sites (both interior and exterior), music and soundtrack, key crew, and production counsel. Production Company and Financier shall mutually approve any Participations that are “off the top” (as defined in Paragraph 3(a)(6)) and any deferments. Financier shall be kept informed of the above.
(b) Final Cutting Authority: Production Company shall have final cutting authority
over each Picture.
8. ASSOCIATE/EXECUTIVE PRODUCER CREDIT: Upon providing the Financing, Financier shall
be accorded shared presentation credit and logo credit on credit block and on the film as follows:
(a) Form. “Associate/Executive Producer ___________________________”
(b) On Screen. On screen, in the main titles, on a shared card, below or after the title
of each Picture but, in an average size of type not less than 100% of the average size of type utilized to accord credit on screen on each Picture.
(c) Paid Ads. In all paid advertising issued by or under the control of Distributor in
connection therewith, but only to the extent the credit block appears in such paid advertising, and except advertisements of eight (8) column inches or less; group and list advertisements; teasers; publicity; special advertising; billboards; television trailers; film clips or other advertising on the screen, radio, or television (“excluded Ads”); except however, Financier shall be entitled to a credit in any said excluded Ad in which any other executive producer receives credit in connection with the applicable Picture. Nothing contained in this Paragraph shall be construed
to prevent the use of so-called award, and congratulatory ads, or other similar advertising in which only the honoree is mentioned, without mentioning Financier.
(d) General. As used herein, “size” shall mean height, width and thickness. Except
as set forth herein, all characteristics of Financier’s credit shall be at Production Company’s sole discretion. Production Company’s casual or inadvertent failure to accord credit in accordance with the provisions of this Paragraph shall not be deemed a breach of this Agreement. Within a reasonable time after receipt of written notice from Financier specifying a material failure to accord Financier credit in accordance with this Agreement, Production Company shall use good
faith efforts to cure prospectively any such material failure to accord Financier credit hereunder with regard to the positive prints or advertising material created after the date of Production Company’s receipt of such notice. Production Company will use reasonable good faith efforts to inform all third party distributors or subdistributors of the applicable Picture of the credit obligations set forth herein; provided, however, that the failure of said subdistributors to comply with the above credit requirements shall not constitute a breach of this Agreement.
(e) All other presentation, producer, executive producer, co-producer, associate
producer, or production company credits shall be approved by Production Company.
9. RESULTS AND PROCEEDS:
(a) Financier acknowledges that all of the results and proceeds of Financier’s services hereunder are and will be created as a “work made for hire” specially ordered or commissioned by Production Company with Production Company being deemed sole author of all such results and proceeds. In the event such results and proceeds are determined not to be a “work made for hire,” then Financier hereby irrevocably and exclusively assigns to Production Company, in perpetuity, all rights (including without limitation all copyrights and renewals and extensions
thereof) in and to such results and proceeds. Financier acknowledges that Production Company is and shall be the sole and exclusive owner of all rights of every kind and nature in, to and with respect to Financier’s production services hereunder and the results and proceeds thereof and that Production Company shall have the right to use, refrain from using, change, modify, add to, subtract from, and to exploit, advertise, exhibit, and otherwise turn to account any or all of the foregoing in any manner and in any and all media, whether now known or hereafter devised, throughout the world, in perpetuity, in all languages, as Production Company in its sole discretion shall determine. Financier hereby waives any and all so called “moral rights” of authors. The termination of this Agreement for any reason shall not affect Production Company’s ownership of the results and proceeds of Financier’s services hereunder or alter any warranty, representation, covenant or undertaking on the part of Financier hereunder.
(b) Each Picture shall contain a copyright notice in the name of Production Company
or its designee complying with all statutory requirements of the copyright laws of the United States or any country which is a party to the Berne Union or Universal Copyright Convention, such notice to appear in the main or end titles of the applicable Picture.
10. DEFAULT, CURE, AND REMEDIES:
(a) Financing Default:
(1) If Financier fails to provide the Financing to Production Company without
cause or other legal justification (a “Financing Default”), Production Company shall have the right (but not the obligation):
(i) to suspend production of the applicable Pictures until Financier
satisfies its obligations to finance the Pictures; or
(ii) to seek and obtain financing from outside funding sources,
including banks, private investors, pre-sales of the applicable Pictures, or the like (“Alternative Funding”).
(2) Financier shall relinquish any rights (including the right to payments of
Distributable Cash) in the applicable Pictures and shall be entitled only to
recoupment of out-of-pocket monies expended in production of the applicable Pictures. Financier shall not have a right of immediate repayment, but shall be paid out of available Distributable Cash.
(3) A Financing Default will not constitute a breach of this Agreement by
Financier until Production Company has provided Financier with written notice specifying such failure(s) and Financier has failed to cure such breach within 48 hours, if during production of the Pictures upon which the Financing Default relates, or ten days during any other time after receipt of such notice.
(b) Production Default:
(1) Any failure to meet an obligation with respect to the production of the applicable Pictures by Production Company shall be deemed a “Production Default.” A Production Default will not constitute a breach of this Agreement by Production Company until Financier has provided Production Company with written notice specifying such failure(s) and Production Company has failed to cure such breach within 48 hours, if during production of the applicable Pictures upon which the Production Default relates (a “Production Cure Period”), or ten days during any other time after receipt of such notice. Financier may elect to continue production of a Picture during a Production Cure Period notwithstanding the absence or failure to perform by Production Company, Production Company shall fully cooperate with Financier in connection therewith and Production Company shall not take any action or fail to take any action that would interfere with the ability of Financier to continue a Picture’s production during a Production Cure Period.
(c) Other Defaults: Except as set forth above, no failure by either Party to fulfill any of its obligations hereunder will constitute a breach of this Agreement by such Party unless and until the non-defaulting Party has provided the defaulting party with written notice specifying such failure(s) and the defaulting party has failed to cure such breach within (i) thirty (30) days after receipt of such notice with respect to non-monetary defaults or (ii) ten (10) days after receipt of such notice with respect to monetary defaults.
(d) Remedies at Law: In the event of a breach by either of the Parties of the
provisions of this Agreement, the aggrieved Party shall be limited to their remedy at law for money damages, if any, and in no event shall the aggrieved Party be entitled to enjoin or restrain the development, production, distribution or exploitation of the applicable Pictures, or the use, publication or dissemination of any advertising, promotion or publicity in connection therewith.
(e) Cumulative Remedies: All remedies accorded herein or otherwise available to either Production Company or Financier shall be cumulative, and no one such remedy shall be exclusive to any other. I.e., the non-breaching Party’s remedy for damages shall be available whether or not the non-breaching Party uses any other remedy available under this Agreement. The pursuit by either Production Company or Financier of any remedy under this Agreement or otherwise shall not be deemed to waive any other or different remedy which may be available under this Agreement or otherwise.
11. REPRESENTATIONS & WARRANTIES:
(a) Production Company represents and warrants the following.
(1) Production Company is a limited liability company duly organized and
existing under the laws of Arizona; that Production Company is a bona fide business entity established for a valid business purpose within the meaning of the tax laws of the United States and not a mere sham, conduit, or agent for Production Company’s owners. Production Company has the full right, power and authority to enter this Agreement and grant the rights granted to
Financier herein without the consent of any third party.
(2) Production Company is not subject to any conflicting obligation or any
disability that will or might prevent it from, or materially interfere with, the execution and performance of this Agreement.
(3) Any material contributed to the applicable Picture by Production
Company shall be wholly original with Production Company and the use thereof by the Parties will not, in any way, infringe upon or violate any copyright or any rights of privacy or publicity, common law rights, or any other rights of any third party or constitute a libel or slander against any person, firm or corporation.
(4) Production Company shall not employ any person, contract for the
purchase or lease of any article or material, nor make any agreement committing Financier to pay any sum of money (other than as set forth herein) without first obtaining the prior approval of Financier.
(5) The Financing shall be deposited into a separate production bank account, which account is dedicated solely to the production of the applicable Picture.
(6) Production Company has (through its own resources or from contributions
from third party financiers), and shall expend, sufficient funds to produce and deliver the applicable Picture to Distributor.
(b) Financier represents and warrants the following.
(1) Financier has the full right, power and authority to enter this Agreement and grant the rights granted to Production Company herein without the consent of any third party.
(2) Financier is not subject to any conflicting obligation or any disability that will or might prevent it from, or materially interfere with, the execution and performance of this Agreement.
(3) Any material contributed to the applicable Picture by Financier shall be
wholly original with Financier and the use thereof by the Parties will not, in any way, infringe upon or violate any copyright or any rights of privacy or publicity, common law rights, or any other rights of any third party or constitute a libel or slander against any person, firm or corporation. Nevertheless, Financier is not anticipated to provide any “creative” services with respect to production of the applicable Picture; thus, this paragraph shall apply only to the extent that Financier actually contributes material to the applicable Picture.
(4) Financier shall not employ any person, contract for the purchase or lease
of any article or material, nor make any agreement committing Production Company to pay any sum of money (other than as set forth herein) without first obtaining the prior approval of Production Company.
(a) Production Company and Distributor shall defend, indemnify, and hold harmless
the Financier from and against all third-party claims, losses, liabilities, actions, judgments, costs and expenses of any kind (including without limitation reasonable outside attorneys’ fees and costs) (collectively, “Claims”) arising out of or in connection with (a) any illegal act committed by the Production Company in connection with the applicable Picture, or (b) any breach by the
Production Company of any representation, warranty, or agreement set forth in this Agreement.
(b) Should Financier seek indemnification under this Agreement, Financier must
promptly give Production Company notice of any legal action. Nevertheless, a delay in notice does not relieve Production Company of any liability to Financier, except to the extent Production Company shows that the delay prejudiced the defense of the action.
(c) Production Company may participate in the defense at any time. Or it may assume the defense by giving notice to Financier. After assuming the defense, Production Company:
(1) must select an attorney that is satisfactory to Financier;
(2) is not liable to Financier for any later attorney’s fees or for any other later expenses that Financier incurs, except for reasonable investigation costs;
(3) must not compromise or settle the action without Financier’s consent (but
Financier must not unreasonably withhold its consent); and
(4) is not liable for any compromise or settlement made without its consent.
(d) If Production Company fails to assume the defense within 10 days after receiving
notice of the action, Production Company is bound by any determination made in the action or by any compromise or settlement made by Financier.
13. DISPUTE RESOLUTION: All claims, controversies, or disputes arising out of, in
connection with, or relating to this Agreement, the performance or breach thereof or default
hereunder, whether based on contract or tort, statute or common law, including without
limitation, any claim that this Agreement was induced by fraud (“covered claims”), shall be
resolved as follows.
(a) Mediation: Any covered claim shall be submitted to neutral, non-binding
mediation before a mutually acceptable neutral prior to the commencement of arbitration, as set forth below. The Parties agree to act in good faith to participate in mediation, and to identify a mutually acceptable mediator. If a mediator cannot be agreed upon by the Parties, each Party shall designate a mediator and those mediators shall select a third mediator who shall mediate the dispute. The Parties and the mediator may join in the mediation any other party necessary for a mutually acceptable resolution of the dispute. The mediation procedure shall be determined by the mediator in consultation with the Parties. All Parties to the mediation shall share equally in its cost. If the covered claim is resolved successfully through the mediation, the resolution will be documented by a written agreement executed by the Parties. If the mediation does not successfully resolve the covered claim, the mediator shall provide written notice to the parties reflecting the same, and the Parties may then proceed to arbitration as set forth below.
(b) Arbitration: Any covered claims under this Agreement not resolved by mediation,
as set forth above, will be resolved by final and binding International Film and Television Alliance (“IFTA”) arbitration under the Rules For International Arbitration of IFTA in effect when the arbitration is filed (“IFTA Rules”). Each Party waives any right to adjudicate any dispute in any other court or forum, except that a Party may seek interim relief before the start of arbitration as allowed by the IFTA Rules. The arbitration will be held in Los Angeles, CA. The Parties will abide by any decision in the arbitration and any court having jurisdiction may enforce it. The Parties submit to the jurisdiction of the courts in the forum to compel arbitration or to confirm an arbitration award. The Parties agree to accept service of process in accordance
with the IFTA Rules
(c) The commencement or maintaining of any mediation(s) or arbitration(s) by a
Party shall not constitute an election on that Party’s part to terminate this Agreement neither shall it constitute or result in termination of the other Party’s employment (e.g., as producer or director) hereunder unless the Party shall expressly so elect by written notice to the other Party.
14. ASSIGNMENT: Neither Production Company nor Financier shall have the right to
assign any of their rights or delegate any of their obligations under this Agreement (except as
otherwise provided for herein) without the prior written consent of the other Party except that
either party shall have the right to reasonably assign or entitlement to revenues hereunder by
written notice of same.
15. PUBLICITY: Neither Party shall authorize or cause the release or dissemination of
publicity (excluding non-derogatory incidental mention publicity) in connection with either
Party’s services pursuant to this Agreement or the Pictures produced hereunder without the
approval of the other Party. Neither Party will issue any press release or public announcement
that mentions the actual terms of this Agreement or the Pictures without the prior written
approval of the other party. Either party may make public statements without the other Party’s
consent regarding the fact that it has a business relationship with the other Party, and that
Production Company is distributing the Pictures.
16. INTELLECTUAL PROPERTY: The Parties acknowledge and agree that in connection
with all of the Pictures, (i) the rights and privileges granted hereunder are fundamentally in the
nature of “intellectual property” as defined in the Title 11 of the United States Code entitled
“Bankruptcy,” as now or hereafter in effect, or any successor statute (the “Bankruptcy Code”);
and (ii) that the Parties’ continued enjoyment of all of the rights and privileges granted herein is
fundamental to, and of the essence of, this Agreement; therefore, all of the rights granted shall be
deemed intellectual property subject to the non-bankrupt Party’s election under Section
365(n)(1)(B) of the Bankruptcy Code.
17. CONFIDENTIALITY: Financier and Production Company each acknowledges that the
terms and conditions of this Agreement and all information and data provided by each party to
the other pursuant to this Agreement (collectively, “Confidential Information”) are confidential.
Each of Financier and Production Company agrees that it will not use Confidential Information
for any purpose other than in connection with the performance of its obligations or the exercise
of its rights under this Agreement, or disclose Confidential Information to any person other than
its officers, employees, agents, representatives, distributors, wholesalers, retailers, exhibitors,
licensees, and permitted assignees on a need-to-know basis only, or unless compelled by law,
subpoena, or court order to disclose same.
18. NOTICES: All notices from Production Company or Financier to the other, with respect
to this Agreement, shall be given in writing by mailing the notice prepaid, return receipt
requested, and addressed to Production Company or Financier, as appropriate, at the address set
forth below, or to any substituted address given by notice hereunder. Any such notice, payment,
or statement shall be considered sent or made on the day deposited in the mails.
Ability Films, LLC / Kris Courtney
304 Winter Garden CT
Lake Alfred FL 33850
Courtesy Copy to:
Kimberly K. Glass
Attorney at Law
P.O. Box 23044
Louisville, Kentucky 40223
Courtesy Copy to:
Jed W. Hill
200 Third Street
P.O. Box 1017
Macon, GA 31202
Courtesy Copy to:
Christi H. Jones
TJS Deemer Dana
1004 Hillcrest Parkway
Dublin, GA 31021
(a) Waiver: No waiver of any breach of any provision of this Agreement shall
constitute a waiver of any other breach of the same or any other provision hereof, and no waiver shall be effective unless made in writing.
(b) Rectification and Severability: In case of any mistake in this Agreement,
including any error, ambiguity, illegality, contradiction, or omission, this Agreement shall be interpreted as if such mistake were rectified in a manner which implements the intent of the parties as nearly as possible and effects substantial fairness, considering all pertinent circumstances. Except as expressly provided to the contrary herein, if any of the provisions of this agreement should be held invalid or in violation of law by any court or other tribunal of competent jurisdiction, this Agreement and all other terms and provisions thereof shall nevertheless remain in full force and effect.
(c) Relationship of Parties: Nothing herein contained shall be construed to create a
joint venture or partnership between the parties hereto. Neither of the parties shall hold itself out contrary to the terms of this provision, by advertising or otherwise nor shall Production Company or Financier be bound or become liable because of any representations, actions or omissions of the other.
(d) Governing Law/Jurisdiction: This agreement has been entered into in the state
of California. The validity, interpretation, and legal effect of this agreement shall be governed by the laws of the state of California applicable to contracts entered into and performed entirely therein. The Parties expressly waive any objection to choice of law.
(e) Captions: The captions of the various paragraphs and sections of the Agreement
are intended to be used solely for convenience of reference and are not intended and shall not be deemed for any purpose whatsoever to modify or explain or to be used as an aid in the construction of any provisions.
(f) Amendments in Writing: This Agreement cannot be altered, changed, modified,
or amended in any way whatsoever except by a written instrument duly signed by authorized officers of Production Company and Financier.
(g) Entire Agreement: This Agreement, which is comprised of the general terms
above (“Main Agreement”) and any attached Schedules and Exhibits, represents the entire agreement between the Parties with respect to the subject matter hereof and this Agreement supersedes all previous representations, understandings or agreements, oral or written, between the parties regarding the subject matter hereof. Any prior agreements, representations or understandings, oral or otherwise, not appearing, nor expressly incorporated by reference, herein, are void or expressly waived by execution of this Agreement.
By signing in the spaces provided below, the Parties accept and agree to all the terms and conditions of this Agreement effective as of the date first above written.
Ability Films, LLC
By: Kris Courtney
Est Delivery Date
Dec 1st, 2019
Current Monies Applied
Associate Producer (001)
Crowd Sourcing Funds Applied
Georgia TAX Incentive (30%)
SUM of Current Spent/Investment
Current Equity / Executive Balance
PRODUCTION FINANCE AGREEMENT - NORMA’S SUN
ABILITY FILMS LLC