Are you a producer or director looking to build a project around a specific actor? Perhaps you’re wondering what the best way to contract with your star would be, to ensure you get the best outcome possible? Is profit participation on the table? As the entertainment attorney Los Angeles trusts, Blake and Wang PA are perfectly placed to help you make the right contractual decisions-so let’s take a deeper look into the world of independent film production and star actor agreement.

Choosing the right contract

Firstly, so you’re fully armed with all the information, we should probably point out that the Screen Actors Guild (SAG) do offer boilerplate contracts indie filmmakers can use for their cast. Stop and think a moment, however, before you rush off to use one as a done deal. This is, after all, one of the top actor unions in the country. Is this really who you want to manage every intricacy of the contract you are about to use?

That is not, for a second, to disparage the SAG at all. They are an incredible organization that has worked tirelessly to protect performers’ rights. They have been of huge influence in ensuring safe film and TV productions with higher workplace standards. However, allowing an actor-focused union to draft the contract you will be using to protect your interests as a film maker is not in your own best interest, the same way that allowing someone else’s lawyer to draw up the agreement would not be. While it’s a quick and easy solution, it’s not going to be the best for you.

A key missing area on SAG boilerplate contracts

So, what’s missing from the SAG boilerplates that you consider? Firstly, there are no options open for equity share/ profit participation. If you’re hoping to attract a Big Name by building a project around them, then this will likely be a glaring absence. It’s also key to formulate profit participation carefully, as getting this wrong could lead to increased residual and Pension Health and Welfare obligations.

Creating a better solution

The most common way of defining profit participation for your actor comes in the form of adjusted gross receipts. Don’t let the terminology frighten you! You may well be conditioned to avoid sharing ‘gross’ with actors if at all possible, but it’s important to realize that not all gross profit is created equally.

Adjusted gross receipts, or AGR, allow you to take into account the costs of production and are, in fact, defined on the production side. In short, distribution and sales fees are removed from the figures.

Deciding on a percentage to offer

So what percentage would be ‘correct’ to offer? Generally, you’re looking at a range from alow 2.5% to a high 15%. Obviously, the higher amount is more typical for a big name celebrity who’s working at scale, or for considerably less than their usual bankable figure.

But a percentage in itself is meaningless. A percentage of what, exactly ? Here you need to make sure your production company has strictly defined its revenue-sharing definitions. And that, of course, is not something that comes with a ‘Legal Zoom’ or similar template LLC. You may not have read all the way through the proforma that came with the filing service materials, but you didn’t miss anything of value, either. Expect nothing much but old, and often outdated, code provisions. In short-don’t assume you’ve got the definition of AGR somewhere. Ensure you sit down with proper legal counsel and craft it, with precise thought to your goals.

With a specifically crafted contract created with your best interests in mind, and a clear idea of both the percentage you wish to offer your Name, and the definition you are using to outline your AGR and revenue sharing definition, you’ll be in a far stronger position to offer a deal that will work for both of you.

Blake and Wang PA didn’t become one of the entertainment law firms San Francisco loves for nothing. We have decades of experience in helping indie filmmakers like yourself create, ratify and administer contracts across a host of projects. No matter what future you envision for your project, let us help you create a solid foundation today.