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THE GOVERNMENT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION
FILM DEVELOPMENT FUND SCHEME
FOR FINANCING FILM PRODUCTION
PRODUCTION FINANCE AGREEMENT
(Case No. CHK/FDF/FP__/2013)
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SPECIAL TERMS CLAUSES 1 14
1. MAIN ELEMENTS 4 2. GOVERNMENT FINANCE 5 3. OTHER FINANCE 6 4. RECOUPMENT 6 5. CONDITIONS PRECEDENT 6 6. APPROVALS 8 7. GOVERNMENT REPRESENTATIVE 9 8. PRINCIPAL PHOTOGRAPHY 9 9. UNDERSPEND 9 10. CREDITS 10 11. PRESS RELEASE AND PUBLICITY 10 12. GOVERNMENT LEGAL FEES 11 13. OTHER MATTERS 11 14. CONFLICT 11
SCHEDULE 1 STANDARD TERMS
1. DEFINITIONS AND INTERPRETATION 12 2. RIGHTS GRANTED 12 3. MUSIC 13 4. PRODUCTION OF THE FILM 13 5. PRODUCTION BUDGET 13 6. BANK ACCOUNTS 14 7. FOREIGN CURRENCY 14 8. VAT/GST (if any) 15 9. INSURANCES 15 10 REPORTS 16 11. GOVERNMENT ACCESS AND RUSHES 17 12. FINAL CUT 17 13. LABORATORY AND FACILITIES HOUSE 17 14. PRODUCTION MATERIALS 18 15. INTELLECTUAL PROPERTY RIGHTS PROTECTION / PIRACY 18 16. OVERSPEND 19 17. UNDERSPEND 19 18. DELIVERY MATERIALS 19
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Clause Heading 19.
Page ACCOUNTING 19
20. FILM TITLE 20 21. CREDITS AND COPYRIGHT NOTICE 20 22. FILM CERTIFICATION AND QUALIFICATION 20 23. DISTRIBUTION AND MARKETING 20 24. GROSS RECEIPTS 21 25. WARRANTIES 21 26. EVENTS OF DEFAULT 24 27. TERMINATION 25 28. CONFIDENTIALITY 27 29. FORCE MAJEURE 28 30. CONFLICT OF INTEREST 29 31. PROCUREMENT 30 32. LATE INTEREST 30 33. MISCELLANEOUS 30
SCHEDULE 2 PRODUCTION BUDGET
SCHEDULE 3 CASHFLOW SCHEDULE
SCHEDULE 4 DELIVERY MATERIALS
SCHEDULE 5 PRODUCTION SCHEDULE
SCHEDULE 6 RECOUPMENT SCHEDULE
APPENDIX A GOVERNMENT CREDIT REQUIREMENTS
APPENDIX B INDUCEMENT LETTER
APPENDIX C DRAWDOWN NOTICE 41
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PRODUCTION FINANCE AGREEMENT
DATED this _________ day of ____________ 2011 BETWEEN: (1) THE GOVERNMENT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF
THE PEOPLES REPUBLIC OF CHINA as represented by the Head of Create Hong Kong of 40/F., Revenue Tower, 5 Gloucester Road, Wanchai, Hong Kong (the Government); and
(2) ______(name of ProdCo)_________ (Certificate of Incorporation No: _______________), a
limited liability company incorporated and existing under the laws of Hong Kong and having its registered office at __________(ProdCos address)_______________ (ProdCo which expression shall include its successors in title and assigns).
RECITALS (A) The Government has agreed to contribute to the part-financing of the Production of the Film on
the terms of this Agreement including the standard terms attached as Schedule 1 of this Agreement (Standard Terms) and the special terms set out below (Special Terms).
(B) All capitalised expressions used in this Agreement (including the Recitals) not otherwise
defined in the Special Terms shall have the meanings given to them in the Master Definitions Schedule signed by or on behalf of the Government and ProdCo (Master Definitions Schedule).
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IT IS HEREBY AGREED AS FOLLOWS:
SPECIAL TERMS 1.
Film: _____________________ Production Budget Amount: HK$ _________________ Screenplay: An original Screenplay by ____________ ,
received by the Government on ________ and including all revisions, amendments and polishes thereto;
Scriptwriter: ___________________ Work on which the Screenplay is based: ___________________ Film Director: _________________ Film Producer(s): _________________ Co-Producer (s): _________________ Executive Producer(s): _________________ Director of Photography: _________________ Editor: _________________ Production Designer: _________________ Stills Photographer: _________________ Costume Designer: _________________ Hair & Makeup Designer: _________________ Composer: _________________ Leading Cast: Leading Actor: _________________ Leading Actress: _________________ Other Financier(s): _____________________(_____________) Sales Agent: _________________ HK Distributor: _________________ Distributor For Areas Outside HK: _________________ Collection Agent: _________________ Auditor: ______________, which shall be a practice
unit as defined under the Professional Accountants Ordinance (Cap. 50 of the Laws of Hong Kong).
Laboratory: _________________ Contingency: HK$ _________________ Production Fee: HK$_______________ (inclusive of all
professional fees for Film Producer(s) services stated in the Production Budget, Production services fees, positive costs, negative costs, overhead fee, development fee, insurance premia, audit fee, employee and contractor salaries, fees and expenses, general and
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administrative expenses, equipment costs, expendable supplies and parts costs for the Production and Approved Overages of the Film)
Duration: Between _______ minutes and ________minutes
Aspect Ratio: _________________ Stock: _________________ Location(s): _________________ Film Certificate: Certificate for Public Exhibition in Hong
Kong under the Film Censorship Ordinance (Cap. 392 of the Laws of Hong Kong)
Commencement Date of Pre-Production: Dates:
_________________ Commencement Date of Principal Photography: _________________ Commencement Date of Post-Production: _________________ Completion Date of Rough Cut: _________________ Completion Date of Final Cut: _________________ Delivery Date: _________________
ProdCo shall not make any changes to any of the Main Elements without the approval of the Government.
2.1 In consideration of ProdCo undertaking to produce the Film in accordance with the terms of this Agreement and subject always to satisfaction of the Conditions Precedent, the Government shall provide a sum of HK$_____________ to partly finance the Production and Completion of the Film (the Government Finance). The Government Finance shall be advanced by the Government into the Production Account in accordance with the Cashflow Schedule and upon the terms and conditions set out in this Agreement. Before each instalment is advanced, ProdCo shall issue a drawdown notice in the form set out in Appendix C.
2.2 Details of the Production Account for the Film are as follows: ____(name of Bank)______, __________(Banks address)___________ Account Number: _______________________ Account Signatories: ________________ ___________________ 2.3 Details of the Collection Account for the Film are as follows: ____(name of Bank)______, __________(Banks address)___________ Account Number: ______________ Account Name: _________________ 2.4 The Government may (but is not obliged to) pay:-
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2.4.1 20% (twenty percent) of the Government Finance 14 days before the Commencement Date of Pre-Production specified in Clause 1 above;
2.4.2 25% (twenty-five percent) of the Government Finance 14 days before the
Commencement Date of Principal Photography specified in Clause 1 above; 2.4.3 25% (twenty-five percent) of the Government Finance ( Create Hong Kong to insert
the exact date) 2.4.4 20% (twenty percent) of the Government Finance 14 days before the
Commencement Date of Post-Production specified in Clause 1 above; 2.4.5 7.5% (seven and a half percent) of the Government Finance after it has notified
ProdCo in writing of its acceptance of the Delivery Materials; and 2.4.6 2.5% (two and a half percent) of the Government Finance after it has notified
ProdCo in writing of its acceptance of the Audited Statement. 3.
ProdCo undertakes to procure the balance of finance for the Film as set out in the finance plan below:
3.1 [insert name of Financier] HK$_____________ ( ________________) 3.2 [insert name of Financier] HK$_____________ ( ________________) 3.3 [insert name of Financier] HK$_____________ ( ________________) 3.4 [insert name of Financier] HK$_____________ (________________) Total Other Finance HK$
4.1 ProdCo shall ensure that Gross Revenues (save for such parts of Gross Revenues which may be withheld in accordance with the Collection Account Management Agreement) shall be credited to and held in the Collection Account. Further, ProdCo shall ensure that Gross Receipts shall be applied in accordance with the terms of the Recoupment Schedule.
5.1 The Governments commitment to advance the Government Finance is subject to fulfilment of all of the following conditions: 5.1.1 delivery to and approval by the Government of the Production Budget; 5.1.2 approval by the Government of the Main Elements;
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