Term
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Five years. Regardless of term, SPE will participate in 3 Bond Films
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Film financing, Guarantees of P&A, Buy-out of Tail Periods
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SPE financing of MGM films
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3 Bond Films-- SPE will have the option to invest (with a fee) up to 25%, or if SPE elects to distribute theatrically at no fee, up to 50% in all future James Bond Films over the term of the relationship
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Others -- To the extent that MGM seeks co-financing on non-James Bond films, SPE will have first right to opt-in on pre-agreed terms. If SPE elects not to finance, MGM can elect to use SPE on a rent-a-system basis or use another distributor. Changed elements would apply
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MGM financing of SPE films
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MGM will have the option to finance up to 50% of Zookeeper and 50% of Total Recall (with SPE having an option to cram down to 25%)
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In addition, SPE will show to give MGM three films per year with negative costs in excess of $25 million and MGM will have the option to invest up to 50% (with SPE having an option to cram down to 25%) in one of those three films
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Guarantee of P&A
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For all films submitted by MGM to Sony for distribution and/or co-financing, MGM will provide a Corporate or Bank guarantee for P&A. SPE and MGM will also explore the potential for MGM to guarantee P&A on films that MGM invests in
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Buy-out of tail periods
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Distribution and Fees on New Releases
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James 3 Bond Films
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Worldwide Theatrical and Physical Home Entertainment: SPE for a 68% fee if SPE invests 25% in the film, no feeand a 5% if SPE invests 50% in the film
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Worldwide Television: MGM
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MGM Rent-a-system Films
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Worldwide Theatrical and Physical Home Entertainment: SPE for a 10% fee
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Worldwide Television: MGM, or if MGM seeks third party distribution, SPE will have a first right for a 10% fee
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MGM Films co-financed by SPE
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Worldwide Theatrical and Physical Home Entertainment: SPE for a 9% fee
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Worldwide Television: MGM, or if MGM seeks third party distribution, SPE will have a first right for a 9% fee
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SPE Films co-financed by MGM
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Worldwide Theatrical and All Home Entertainment (Physical and Digital): SPE for a 9% fee
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Worldwide Television: MGM, with requirement that MGM generates revenues equal to what SPE included in its greenlight model
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Selection of Theaterical Release Dates and VOD Dates (Including Premium VOD)
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Bond Films – In-line with prior practice
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SPE Films (including those co-financed by MGM) – SPE’s sole discretion
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MGM Films distributed theatrically by SPE - Mutual approval with SPE having a tie breaker
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Home Entertainment Distribution Responsibilities
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Physical
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SPE to handle physical distribution of all of MGM’s New Release products (with fees outlined above)
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SPE to handle physical distribution of MGM’s Catalog product for a fee of 10%
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MGM to bear transition costs of $5 - $7MM
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Digital
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Television Networks and Co-productions
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MGM Networks
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SPT assists MGM Networks with back office and/or ad sales & distribution sales for a fee/price + an equity relationship. Equity specifics TBD pending discussion with MGM.
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Co-production
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SPT has first option on MGM’s TV development for 50/50 creative control, co-financing of project and resulting pilot and series, and split distribution with MGM
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If an SPT producer is assigned to the project, then SPT chooses which distribution region (US or International)
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SPT is the physical producing party
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Other
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