Media contracts

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Media contracts

Our media clients create films, music, television, theatre, and events.  Their projects require a host of media contracts. Our experience minimises their risks. We tailor every contract to their project.

Standard form contracts are not tailored to your contract’s characteristics and quirks.  We prepare bespoke documents to fit your requirements.  Our corporate expertise minimises your commercial risks.

Joint ventures & royalties

We find that most media projects result in the creation of a  joint venture company, e.g. a writer partners with a production company to produce a TV series. Both parties agree to produce a series ready for broadcasting.

Structuring a joint venture

The joint venture company issues shares to the writer and production company. The share split depends on their commercial negotiations. However, the joint venture company requires bespoke articles of association and a shareholders’ agreement.

Alternatively, both parties may negotiate a co-production agreement. Here, both parties agree to provide their services to complete the production. We then assess potential problems in the:

  1. Joint venture’s financing;
  2. Complimentary agreements, e.g. employment contracts;
  3. Event the production stalls;
  4. Definition of when the project is complete; and
  5. Services that each party supplies, and in the
    • Event that services supplied are not up to standard.

All projects differ. Hence, experience is crucial.

Royalty splits

If the parties create a joint venture company,  The royalty split depends on the parties’ relative shareholding. The joint venture company receives royalties, and pays dividends to shareholders.

Flexible royalty payments

Different share classes could enable flexible royalty payments. For instance, the joint venture company sends the production to multiple publishers or broadcasters. Perhaps, one party has better connections with a publisher or broadcaster. The parties may agree that the “better connected” party receives all the royalties from that publisher/broadcaster.

Spin-off rights

A key issue, that is often forgotten, is spin-off rights, i.e. what if there is a sequel. Will the parties enter into similar terms for the sequel? We know the likely issues that will arise.

Media financing

All projects require financing. Projects often rely on employees, runners, back office staff, writers, producers, and directors. These skills cost money.

Seeking finance

Common methods to finance a project include:

  1. Each party contributes capital;
  2. Angel investment; or
  3. Debt finance from a bank.

Often these methods are inappropriate. Both parties may lack capital, or relationships with angel investors. Banks are risk-adverse.

Flexible financing

Often the parties pitch their ideas to publishers or broadcasters. They require a non-disclosure agreement.  The publisher or broadcaster provides initial finance, and in return they are entitled to the finished project.

Media projects: finance agreements

Finance agreement terms often include:

  1. Pre-emption: the publisher or broadcaster has the right of first refusal once the work is complete;
  2. Exclusivity: Does the publisher or broadcaster enjoy exclusive use of the work?, however
    • These terms often conflict with competition laws;
  3. Further rights: Does the right of first refusal extend to the producers’ further works;
  4. Veto: producers often agree to consult the publisher or broadcaster on key decisions.

These days, such finance structures are common. It is imperative that producers:

  1. Retain the copyright to their works; then
  2. Licence the rights to the publisher or broadcaster.

Celebrity and sportsman endorsements

When a celebrity or sportsman endorses a media project, the project often reaches a larger audience, which boosts revenues.

Addressing issues with endorsement

Most celebrities or sports people employ an army of lawyers to protect their image and reputation.  These lawyers often draw up the licence agreement. We ensure your project is not affected by:

  1. Unauthorised use: The terms should include the celebrity or sports person’s  express “consent” for the use of their name/image;
    • The agreement should be a licence, not an assignment.
  2. Penalties: what if  your project breaches the agreement’s terms?
    • Usually, the agreement contains a liquidated damages clause, which entitles the celebrity to an immediate payment.
  3. Consent: Celebrities usually try to require their express consent for each marketing method. However,
    • A list of “permitted uses” can reduce this requirement.

Bargaining power dictates terms. Nevertheless we know the arguments that improve your position.

Image rights

This agreement enables a company to acquire the rights to reproduce the image and likeness of a well known individual.  The term “image rights” suggest rights are limited to images. However, this term now extends to:

  • Voice likeness;
  • Voice recognition; and
  • Facial recognition.

The key is proper drafting of the agreement. We find the major pitfalls lie in the definitions.

Image rights agreements: scope

This agreement enables the producers to exploit the image rights and receive monies. The producers account to the image holder for the “receipts”. To limit the image holder’s entitlement, a narrow definition of “receipts” is important.

Image rights agreements: risks

If the image rights agreement fails to coherently cover all the images’ intended uses, then the project is at risk.  “Super injunctions” are common. These injunctions prevent further use of the image/name without the celebrity’s express consent. The damage is irreparable.

These agreements are important to those projects involving theatre, and events. By such an agreement, an individual or company will agree to provide non-exclusive sponsorship services, e.g. attending marketing events.

Drafting sponsorship agreements

These key issues are often unaddressed, until a dispute embroils. We foresee disputes to prevent wasted costs and management time.

Expenses

Will your project pay the expenses incurred by the individual or company that provides the sponsorship service?  If you do pay their expenses, are the expenses capped?

Services

What services will the individual or company provide?  Will the individual or company provide warranties for their service levels?

Notices

How will the project notify the sponsor when their services are required? What notice period will be given?

Publishing agreements

Publishing agreements are often high value. High value agreements are risky.

Publishing agreement: scope

Publishing agreements involve royalties. The publishers sells the work, and accounts to the creator, often the author, for royalties. Usually the publishing agreement is exclusive, and “ties in” the creator for a fixed period.

The publisher usually pays the creator in advance of the publisher’s receipts.  However, the written work will be in “agreed form”. This ensures the publisher does not publish works without the creator’s express consent. Copyright requires attention, and the published works should incorporate a copyright notice.

Publishing agreement: key terms

A publishing agreement often comprises three stages, when the written work is::

  1. Ready for paperback and hardback sale.
  2. Available for electronic download, i.e.  e-Books; and
  3. Available for audible download, i.e. an audiobook.

At each stage, we update the publishing agreement to cover the new customers. Often publishers pay the creator a lump sum at each stage.

Media contract track record

Recent instructions include:

Incorporated joint venture company:

This included  bespoke articles and shareholders’ agreement. The BBC financed the joint venture company which produced a TV series for the BBC.

Structured musician’s finance

to enable a musician to produce a new album. We Negotiated the terms with the record label, who had a right of first refusal on the works.

Image-portfolio rights

We prepared agreements for a celebrity,  to enable him to raise funds for a personal project through endorsements.

Writers’ special purpose vehicle

We created a special purpose vehicle to enable the writer to produce a new film.  The writer financed the production and entered into commercial contracts with agencies, employees, and individual producers and directors. We ensured all intellectual property rights remained with the company, regardless of each individual’s contribution.

Summary

Media projects require legal input to address risks and prepare the documentation. We step in to assist with the process. We provide the corporate, intellectual property, and commercial experience to protect interests. With our service comes years of experience, which can help guide you to the correct position.