Industry System

Industry main organs brakedown and description

Industry Main System

Audience

Viewer is the reason to make the film. For this reason we ask:

1. Does the picture bring in the viewer forward strong emotions?
2. Do the creators of this film have strong connections with the specific audiences and theme of this story?
3. Does this motion picture deserve to be made?
4. Is the timing of this picture justified?

An 'A' picture for us is determined by the harmony of all audience, visual, audio, and literary qualities focused on the theme of the property through the characters of the film.

Team

Friends of QSE

The team makes QSE come to life. This group is benefited by QSE and in addition to their tasks it also functions to create the fabric of QSE, which is an essential network of film industry relationships based on producers trust in the team and understanding of the industry engine.

1. Partner (optional)
2. UPM - Unit Production Manager
3. Entertainment Law Firm and Lawyer
4. Entertainment industry bank
5. Completion Bond
6. Publicist (find when development is fully financed)
7. CFO
8. Consultants

Private Investors

Private Investors are invited to invest exclusively in the development phase.

1. Our projections foresee for the investor 120% return in one year and 10% of developed pictures gross in the long run
2. Must be sophisticated investors
3. Have a Limited Partner status in a Limited Partnership (LP)
4. Details available in our 504 investment memorandum

QuickSummer Entertainment, LLC

1. Parent company to be registered in the US
2. Production Company, which manages its development companies as Resonance Pictures, LP
3. QSE also manages its one-film producing companies as Ford T, LLC
4. Manages its Estonian affiliate Welcome Entertainment, LLC

Detailed description in the mission statement

Resonance Pictures, LP

QSE development company

1. Activity is limited to 3-5 pictures
2. Sells fully developed films to QSE owned one-film producing company as Ford to Ford-T Productions.
3. May work in parallel with other QSE development companies
4. Develops chosen pictures according to QSE mission statement and as set forth in our 504 investment memorandum

Welcome Entertainment, LLC

QuickSummer Entertainment, LLC affiliate to be registered in Estonia

Production company's co-production partner, an Estonian producing entity, executes QSE duties in Estonia according to contract with QSE

1. Participates in producing
2. Expresses interests of Estonian film industry
3. Supports other international industry producers in Estonia
4. Manages QSE development financing
5. Participates in QuickSummer Entertainment, LLC net-profits

Ford -T Productions, LLC

QSE's producing company

1. QSE owned and managed one-film producing company
2. Separate producing entities facilitate work, distancing QSE from responsibility derived from guild, talent and other contracts.
3. Ford -T Productions could act in parallel with several QSE producing companies
4. Production is financed with bank financing which is collateralised by presales bankable Letters of Credit

Major Industry Organizations

For success unavoidable industries major distribution and financing organizations with whom producer has contractual relationships

1. Distributors (10 USA Major Studios)
2. Pre-buyers
3. Distribution rights buyers:
   1. Video chains (Blockbuster)
   2. Foreign markets
   3. Television markets (networks, premium cable, pay-per-view)
   4. Ancillary media windows
4. Co-Production companies
5. From the team: bank and completion bond company

Industry Organizations

These and some other motion picture industry organizations are not part of QSE production team, but are vital for pictures' success:

1. Markets (AFM, Cannes, MIFED)
2. Exhibitor Relations Co. (Feature Release Schedules)
3. Guilds (DGA, WGA, SAG)
4. Information (Nielsen EDI, Showbizdata, Eagle-i, IMDB)
5. Talent information (Celebrity Services, Inc.)
6. MPAA (Motion Picture Association of America)
7. NATO (National Association of Theater Owners)
8. Print Media (Variety, Hollywood Reporter, Video Store Magazine)

Industry Presale System

Issuing Bank

Foreign Distributors Bank

1. Pays the agreed pre-purchase amount to producer's bank
2. Pays according to Notice of Assignment & Lab Release Letter
3. NA attachments line out the payment conditions X, Y, Z
4. Issues the Letter of Credit
5. L.O.C is only as good as its attachments X (NA), Y (Arbitration Award), Z (ND) are - can deny payment
6. They need to let producer know when they have given draw down request - Notice of Presentation to the Beneficiary Bank
7. Hopefully there is an L.A.L and the film is deposited in the lab and viewed prior to payment
8. Needs to receive: 4 Certificates of Origin, 4 Cert. of Authorship, and Spotting and Dialogue Lists in the Presentation Package
9. L.O.C. is issued when contracting bank signs, and finalized at least during the commencement of pre-production when the completion bond has locked in

QSE Bank - Production Co. Bank

Recipient of the L.O.C. and the beneficiary

1. Loans the money for the producer according to L.O.C.
2. Works with the producer to perfect the L.O.C. verbiage
3. Gets the payment from Issuing Bank upon delivery of the film
4. Needs a Bank Memorandum Package from the producer
   1. Completion Bond documents
   2. List of talent attached (director, principal actors, DP)
   3. Top sheet and budget
   4. Script breakdowns and production boards with screenplay
   5. Domestic theatrical distributor acceptance (may be verbal)
   6. Some additional items
5. Financing is available after pre-production, so producer needs to get some advances from the pre-sold foreign distributors or engage in minimal gap financing to get through pre-production.

Major Studio

1. Studio would rather distribute then produce, 9 out of 10 pictures are independently produced not in-house
2. Has up to 10-1 credit lain with its bank
3. Most sophisticated distributor there is
4. Enjoys working with professionals (our team)
5. Must be involved starting with picture development
6. Production Company should negotiate with studio for P&A - # of prints & TV-ad time by reach and frequency
7. Approach first the only right studio for each picture

For producer major studio is a distributor of domestic theatrical and partial video rights. Because they have a pipeline of output deals with the members of NATO and with television networks, they need product to fill these 'put' contracts.

Completion Bond

1. If there is bank involved, then completion bond is necessary
2. Only guarantees to bank and studio that delivery of picture occurs
3. To access cash for production from the bank the loan is secured by the bonded film - this is not insurance policy
4. Bonding company checks if contractible talent is trustworthy available and capable, if production don't get rained out in location, if picture will come in with projected budget, etc.
5. If producing co. fails, will take over, or soft-takeover the picture
6. Wants delivery to the bank to be Notice of Delivery (ND)
7. Cost for service is 3-6% of negative cost - 50% of it usually refundable after delivery occurs.

The system of bank, studio, completion bond, and production company are intertwined, they are one system bypassing the pictures produced on spec and for film festivals.

Pre-buyer

Foreign distribution companies which would also buy the film after its production for about 50% more.

1. Pre-buyer is ever interested in the Major Studio pictures
2. A certain star would make a picture easier to sell in some region
3. Pre-buying companies are made to compete with each other prior to agreeing on the Letter of Credit by their local media
4. Pays the minimum guarantee of the advance on delivery
5. Can object to payment if Notice of Delivery is permitting the technical inspection when Lab Access Letter is attached
6. Notice of Assignment (NA) arrives from the licensor bank to licensor (producer) who forwards it to licensee (pre-buyer), who must sign or there is no film
7. Pre-buyer payment transfer is made through intermediary bank in Hungary, or producer has to have a Gross Up clause in the presale contract

QuickSummer - Production Co.

Producer is to do the tough job of making the production happen, keeping all parties happy and is taking the biggest risks:

1. Producer is responsible to check the L.O.C., as any other documentation with lawyer and prove its authenticity and block it if is fraud
2. Make sure the L.O.C. document states 3-10 days before payment for you to run to the lab with the Lab Access Letter
3. Make sure the Arbitration Award is attached to have check mate with the L.O.C.
4. Negotiates deals up front and masters the documents as Long Form shortly thereafter
5. For physical delivery you need Inner Positive, or Inner Negative, Optical Sound Track, and Music and Effects