Negative pickup: A negative pickup looks like a PFD deal, except that the distribution company, again a studio or a VOD company, agrees to pay a fixed price when the film is delivered. Since the distribution company does not advance production costs, the production company must obtain a loan to finance the production and the lender almost always needs a closing guarantee to ensure the completion and delivery of the film to the distribution company in order to trigger the payment. Because of the introduction of the lender and the final guarantor, these transactions are more complex than a pfd agreement. Pre-sale: Pre-sale is a limited distribution agreement for a given country, concluded before completion and often even before the start of production of the film. Thus, most advance sales are a foreign distributor who agrees to pay a fixed amount (an advance or a minimum guarantee) in the event of delivery of a film in exchange for certain rights to the film in a given country for a limited period of time. In most cases, no ancillary rights are acquired (e.g.B. merchandising, publishing and soundtrack rights). In addition to the advance due to delivery, the distributor agrees to pay for “overruns” that depend on the success of the film. Rent-A-System: in the case of a system rent-a contract, a producer licenses certain film rights for a limited time to a distribution company, usually a studio, but the distribution company is not required to pay an advance to the producer to finance the production or to take over the delivery of the film. In some cases, the producer bears all the distribution costs associated with the film. In exchange for the absence of fixed payments by the distribution company, the distribution company accepts a very low distribution fee and the remaining revenues are returned to the producer. For the most part, the distribution company avoids any risk of loss related to the film, especially when the distribution company does not cover the distribution costs and the manufacturer bears the risk and reward for the success or failure of the film. Due to the distribution company`s lack of financial commitment and the limited upward trend in relation to low royalties, distributors have little incentive to properly market and advance a rent-a-system film, so these films are often out of order.
In most cases, the distribution company acquires long-term rights worldwide when the film is delivered. However, in some cases, rights are limited to a specific clause or territory (. B for example, the United States and Canada) or may result in the exclusion of certain ancillary rights. In this regard, a negative pickup looks like a presale (see below), but it is customary to refer to a U.S. takeover.