Film Distribution & The Negative Pickup Film Contract

Film Distribution & The Negative Pickup Film Contract

Film producers frequently face challenges when it comes to procuring financing. That will lead to their being able to produce and ultimately distribute a motion picture. Because there are so many challenges involved, and film production is so costly to achieve. It’s no surprise that there are a number of creative financing options which have evolved within the industry. In fact, there are so many potential financing options available. That a producer could easily lose creative control of their project if they’re not careful. Especially in the case of the negative pickup film contract. 

The negative pickup film contract typically takes place between the producer and the distributor. Providing financing for the production of a film. With the agreement that the distribution company will pay a fixed price for the negative of the motion picture when complete.

It’s important for filmmakers to fully understand how the negative pickup film contract works before they dive fully into such an agreement, though. 

What is a Negative Pickup Deal in the Film Industry?

The negative pickup deal basically states that the film distributor will provide an agreed upon, fixed sum for the negative of the motion picture at a particular date.

It’s basically a guaranteed agreement to purchase the film for distribution at the specified date. As long as all other obligations that are set forth in the deal are met. 

The negative pickup film contract will also usually include banks, lenders or other private financiers. Which are involved in the delivery of “gap financing” for the production.

These lenders like to know about negative pickup deals. Because they are involved in financing the difference. Or otherwise filling the gap in financing that is left. 

What’s Required in Order to Obtain a Negative Pickup Film Contract with a Distributor?

As a filmmaker, it’s important for you to know that there are certain aspects of your production which must be in order if you want to obtain a negative pickup film contract with a distributor.

In fact, certain areas of concern must be properly ordered as a distributor simply will not overlook these elements.

For example:

  • The filmmaker must be able to provide a clean chain of titles for the distributor to review. A negative pickup film contract will not move forward if the distributor cannot establish that the appropriate rights have been procured and the copyrights are in order for the production. They absolutely do not want to find themselves with a film that they cannot distribute due to chain of title issues.
  • Filmmakers must make sure that the distributor is satisfied with all principal participants, cast and crew members, that are involved in the production. Distributors may also request that the filmmaker pre-approve all profit participants with them, too.
  • In some situations, the distributor might require that the filmmaker provide contracts for their pre approval in advance of the production. If this is the case, doing so will be vital to procuring the final negative pickup film contract as agreed.

In Summation

Once a negative pickup film contract has been engaged between the producer and the distributor, it’s important to ensure timely delivery of the negative to the distributor so as not to void the agreement.

In such a case, the distributor becomes the owner of the copyright. Obtaining all rights to the exploitation of the motion picture. It’s all part of the negative pickup film contract and the agreement that was entered into early on. As a means of procuring financing for the production.

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