8 Recoupment – Net Profits
The safest way to double your money is to fold it over and put it in your pocket.
Kim Hubbard
Net Profits
As a general rule of thumb, a film producer should try to retain 50 per cent of net profits for himself and use the other 50 per cent to pay investors in the film. Producers will be required to pay talent, such as writers, actors and the director, a share of the net profits as part of their overall payment. The balance retained by the producer is sometimes known as ‘Producer's Net Profits'.
During the deal-making process, it is important to define what the producer is actually offering. Those negotiating with the producer should enquire whether the percentage offered is the entire net profits of the film ...
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