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A Primer on Protecting Investments In Motion-Picture Productions

By Sean F. Kane
June 29, 2005

If not for the infusion of private capital, many independent films ' generally films produced outside the traditional studio system ' would probably never have been made. That's because banks are unlikely to loan money for such an uncertain and risky venture ' the success of which is greatly dependent on the fickle nature of audiences. But most independent film investors are either unaware of, or pay little attention to, the realities of the theatrical film market. Given the limited potential for widespread independent film success and other inherent investment risks, an entertainment attorney must be diligent and proactive to fully protect a client's film investment.

Structure of the Production Entity

The agreements for production financing are as varied as the underlying films. The terms and conditions that may be imposed upon the production company by the financing source also vary greatly. Traditional film-studio agreements subject a filmmaker to a number of approvals and controls, unless the party is very experienced and has an established relationship with the studio. When drafting an agreement for an investment in an independent film, an attorney should attempt to enact a similar level of approvals and controls for the benefit of his or her client.

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