Creative endeavors are often exhilarating and intimidating at the same time. Based on your choice of entertainment media, you will likely face unique challenges in getting it in front of a receptive audience. Unfortunately, since there are so many moving parts required to bring a film to fruition, there are numerous pitfalls that can derail the entire project. It is important to take the project’s financing seriously from the very start.
Even though it can be exciting to start building an agreement centered on funding, it is crucial that you take steps to protect yourself and the project from start to finish. Even though every situation is unique, there are certain tips that can help, including:
- Use succinct language: For many, the temptation is to fill a contract with legalese. Many individuals might do this to sound important or experienced, while still others might use language from a templated contract that does not match their industry. It is important to use clear, succinct language when drafting any type of professional contract.
- Avoid any sort of verbal agreement: As soon as phrases such as “Trust me” or “We’re good for it” enter any sort of conversation, it should be a warning sign. Any agreement based on finances should include the preparation of a written investor agreement stipulating the terms of the agreement, provisions for alterations and penalties for a breach.
- Avoid vague language in any contract: Investors will likely attempt to slant the language of the contract in their favor. This is a common practice in any industry. You must be aware of the possibility and the danger of vague language or ill-defined terms. The contract must be clearly written to the benefit of all parties.
- Take investors seriously: Moving forward with any creative project can be a heady, thrilling experience. Unfortunately, it is not uncommon for individuals to move too quickly and fail to take certain factors seriously.
Financing agreements and entertainment law contracts often contain numerous layers of complexity. It is not uncommon for certain provisions to be contingent upon other provisions. Whether this is your first film project or your fifth, it is wise to seek the guidance of an experienced entertainment lawyer who has the depth of knowledge to protect your best interests every step of the way.