Paying points is a typical offering to cast and crew on low budget projects. However, most independent production companies never payout points because they never have it contracted – Just offered by word of mouth. Those companies that actually contract the points may have little left over to pay it.

I’ve used points for several film projects and it works well as long as the film has multiple release venues including video and television distribution. The only unfortunate thing the producer has to deal with is a lot of paperwork for years. To reduce the tracking efforts, many times a date will be picked to offer the cast and crew an opportunity to sell their points back to the production company for a certain dollar amount or for product.

Sometimes the payment is made with excess DVDs based on a discounted value. This allows the cast member to sell the DVDs for cash or give them away to friends and family during the holidays or for birthday gifts. I was involved in a points based project that paid me 300 VHS tapes. I sold some, but you can guess what my kids gave at every birthday party they attended for an entire year. Had I sold all the tapes at 50% off retail, I would have made 3X my normal production rate.

Points vary greatly between projects and so does the amount of cash involved. One project paid 20% of a person’s rate in cash and the rest in points. Another project paid 10% in cash, 50% in points, and 40% in DVDs. The variations to financial packages are endless, but the key concept to understand up front is that eventually the production company will want the points off of the books and will either have a cut-off date or a buyout date for the points.

Here is a made up breakdown of dollars to clarify what is available for point payouts:

Film Revenue

$140,000,000   Actual Box Office Receipts

$100,000,000   Reported Box Office Receipts (after counting errors)

– $20,000,000   House Nut – Negotiated amount to cover concessions for film

$80,000,000   Theaters pay to distributors

– $20,000,000   Deduction to cover P&A (prints and advertising)

– $40,000,000   Distributor fees/margins

$20,000,000   Gross payment to producer

– $6,000,000   Production costs (cash returned to investors)

– $9,000,000   Investor payback agreement

– $1,000,000   LLC Operations

$4,000,000   Net Profits

– $3,000,000   Investor profits

$1,000,000   Point payout (all points total to 100%)

Please note that in the above scenario the people on the point system are the last ones paid. It should also be noted that the film scenario brings the point people to breakeven, which means their payout for DVD and television sales will be much higher as the investor payouts will be much smaller going forward. This is due largely to the producer scaling the payback structure to reward himself should he make a hit. On the above scenario the investors’ payout schedule declines after they reach 2.5X their original investment.

Every monetary exchange percentage is highly negotiable. The general rule of thumb for the producer is to get as much cash up front from the distributor as possible since creative accounting can reduce payback after the film’s release. The same rule applies for cast and crew. However, if the only way to be a part of a certain picture is to be on the point system, make sure it is in writing and the film has multiple venues. Also make sure alternative payouts or buyout programs are in writing.

There is one other concern about the point system and that is the 100% ceiling. Since it is against the law to promise more than 100% of profits for payout, the total number of points given out will always equal 100%. So if the production company offers you 10 points and they give out 20 points in total, you own 50% of the payouts. If however, you are promised 80 points and they give out 1,000,000 points, then your percentage isn’t worth talking about, as it isn’t even high enough to be considered a rounding error.

Even if you get the estimated number of points in writing, there is a consideration clause for going over budget. So lets say you sign an agreement for 120 points out of 10,000 points and the film goes over budget. There might be additional points paid out to bring a new stunt team in for the mass explosion scene. The new total number of points rises to 12,000 changing your 1.2% payout to 1%. According to the above scenario, your $12,000 payout just dropped to $10,000.

Also, the above scenario of an independent film bringing in $140MM at the box office is a great scenario to spell out how the points work, but consider that the average independent film only makes $6MM at the box office. This puts approximately $6,000 into the points kitty for the cast and crew. Now your 1% equates to a nice dinner or a dozen DVDs. However, the additional venues of release will increase your payout.

Copyright © 2013 by CJ Powers

Photo © mellefrenchy – Fotolia.com

I received a great question the other day and wanted to share it along with my response. “Should a screenwriter register her script with the WGA or with the Library of Congress?”

Now, I suppose that a disclaimer should be given at this point. What I’m about to share is based on the perspective of a writer, not a lawyer. Okay, I hope that helps you to understand there is no client lawyer relationship here – I do not practice law.

My answer is both. The copyright registration gives a certain level of legal entitlements for life and the WGA registration gives you a quick validation of the work’s existence.

The thing I like about the WGA is that I can instantly register my script online with a third party that, if needed, will send a representative to testify in court on my behalf. The WGA rep would testify to the facts about the particular script in question being registered at a specific date and time under my name.

When I was a kid, writers were know to mail themselves copies of their work in a post office sealed envelope. The seal would have a stamp placed across it and cancelled to prove the contents were in existence at the date of the cancelled stamp. This held up in court during numerous trials, but started falling apart when the seal was broken due to climate conditions or other reason.

Being able to show the Library of Congress certificate for copyright registration of the work in court is the ideal. Since the Library of Congress is a government entity, holding the copyright brings a quick end to any trial dealing with a possible infringement. However, it takes 2-6 months for the registration, which puts the work at risk for some time.

The best news about a copyright registration is that it entitles the writer who wins the court battle to receive an award of statutory damages and attorney’s fees. There are no awards based on the WGA, as there is no legal precedence that gives the WGA legal clout.

Some screenwriters take advantage of the copyright laws that allow you to own the copyright without registering the work. However, this becomes a little precarious without additional proofs of the creation date, which the WGA registration would help. However, it’s my practice to register all significant version changes with the WGA and the “first” work and or the “finished” work with the copyright office.

Copyright © 2013 by CJ Powers

Photo © mipan – Fotolia.com

Speakers start off their talks with some form of attention getting device. Newspapers use a headline to draw the person to a newsstand in hopes of them picking up a paper. Book authors try to capture the reader with a snappy cover, title and great first paragraph. Movie posters use imagery and star power to attract the passerby. Even movies open with some opening imagery or teaser to pull the audience into the story in the first 2-5 minutes of the film.

Attention Getting Devices are more important today than any other time during our history of communication. With attention spans dropping from 20-30 minutes in the 1960s, to 8-12 minutes in the 80s, to 90 seconds to 2 minutes in the 2000s, it is more important than ever to not only grab the attention of the audience, but to keep it.

Mega box office features use large scale, fast action, and cool visual imagery as attention getting devices. Dramas use a point of fascination within the story coupled with raising a question within the audiences’ mind about how the story will paly out or resolve.

I was chatting with screenwriter Guy Cote last night about how attention getting devices are no longer restricted to just open a film, but are now needed in a more subtle, but still effective form within each scene in a movie. It’s Guy’s view that there has to be something special in every scene that entertains the audience and I agree.

I looked back at the courtroom drama we co-wrote, Tried & True, and realized we did that very thing. Every scene has some form of entertainment in it, which forces the story into a more cinematic mode, compared to the film being limited to a direct to DVD release or television.

The BBC’s Sherlock MOWs are fascinating, as every scene has some entertaining nugget or reveal in it. I’ve watched all 7 episodes and can hardly wait for the 3 that will be released this year. Each 90-minute episode could be successful in theaters and keep the audiences’ attention, but the BBC decided to release it on television – In my opinion, raising the standards of television.

The average number of stars on a 10-point system that critics have assessed the Sherlock shows is a 9.2 over the 7 episodes. This is amazing when you think about maintaining such a high quality of story within 10 stories over 3 years. Its no wonder the series is a huge success internationally – Everyone loves a high quality entertaining story.

Here are some of the attention getting devices that are salted throughout every scene in Sherlock:

Universal Question
A question in the form of a mystery is revealed at the beginning of every episode. This drives the audience to watch the film until they get the question answered. In most episodes the question is associated with a murder that must be solved within a certain time constraint to drive the audiences’ need to know the answer with a sense of urgency. In some scenes additional questions get raised or it’s revealed that the universal question has more parts to it.

Relationship Reveals
The unique relationship between Watson and Sherlock is like an onion that has one layer peeled a way with each story. The characters are both clearly experts in their fields, which generates mutual respect and a sense of friendly unspoken competitiveness. This drives the audience to know more about how and why they get along so well, even when the relationship appears dysfunctional or miraculous – Both very entertaining prospects worth exploring.

Hyper Focus
Sherlock’s level of genius brings boredom into his life all too quickly. He needs extremely difficult puzzles to solve or his insanity rises. This demand on his soul for stimulation drives him to observe the tiniest of details and drives a fascination in the audiences’ mind as they watch genius at work. Everyone loves watching extreme experts do their thing like Michael Jordan playing basketball, Luciano Pavarotti singing lyric opera, and Sherlock solving unsolvable cases.

The above attention getting devices are salted generously throughout each scene. These entertainment moments are embedded organically in each scene making it’s existence mandatory for the progression of the story. In fact, I can’t recall seeing any scene that didn’t have to be in the film. Nor was there any scene that didn’t have something specific for the audience to enjoy or chew on.

The series also used a good deal of humor to help the audience rest just long enough to be refreshed and then reengaged into the mystery. By allowing the audience to get their emotional wind back, they were ready to receive more information and attempt solving the case as junior detectives. Each viewer was bound to walk away from an episode longing to be more like Sherlock, or at least feeling driven to be the best in their field.

Copyright © 2013 by CJ Powers

Illustration © okalinichenko – Fotolia.com