2. EXECUTIVE SUMMARY
A House Divided, L.L.C. a newly formed, limited liability company for the purpose of investing in the production of the drama film, “A
HOUSE DIVIDED.” The Picture created will be energized, powerful and interactive with its core audiences.
Drama is a genre catering to a dynamic domestic and international market. Audiences all over the world share a strong appetite for a
strong indie drama as they await the next great breakout film. Unlike most other genres, dramas are often a showcase for talent, and to
succeed at this level, filmmakers must utilize and display cinematic technique and language in some of its most expressive forms. This
genre has launched some of Hollywood’s most successful and prolific careers, and is at the center of what the major studios are producing
at a strong budgets every year. The Picture will bring established, as well as, new talent to produce the Picture under the key creative
personnel’s strict provisions, ensuring its pathway to success.
Leveraging our industry relationships and drawing upon our extensive knowledge of the motion picture business, our production team
behind the Picture will provide investors with quality deal flow and sophisticated management to maximize long-term investment
returns.
MISSION and BUSINESS MODEL
The Company anticipates raising a total of one million, five-hundred and seventy-five thousand ($1,575,000) in equity.
The Company seeks to operate as follows:
• To finance the development, pre-production, and production of said Picture; and,
• The Picture is of the drama genre; and,
• The Picture will be designed for theatrical, direct-to-video, video-on-demand and ancillary markets release; and,
• The Picture will be rated ‘R’ by the MPAA; and,
• P&A $200,000 to help push (Guaranteeing minimum theatrical release).
The Company will provide operating overhead for the production of the Picture; 100% of the Picture’s negative production cost (defined
as all out-of pocket production costs); and development and/or acquisition of material. The Company’s distributors and/or foreign
distributors will finance all out-of-pocket worldwide print and co-finance advertising costs (“P&A”) for the Picture and will be
responsible for all other distribution expenses, subject to certain pre-negotiated parameters and spending caps on each line item.
LOGLINE
A young writer moves back home with his parents only to see his little brother inherit millions from a long-lost family friend; as he
investigates why, his jealousy tears his family apart and brings to light secrets he never could have imagined.
PRODUCTION TEAM
George Elder, Daniel Elder, and Brent Huff have more than 60+ years of combined entertainment industry experience in all facets of the
motion picture process, including development, financing, production, distribution, marketing and management of intellectual property.
The production team is supported by important and beneficial relationships with major entities in the entertainment industry. These
long-term relationships represent an aggregate of industry know-how with individual areas of expertise. (Full Bios available)
MARKET DEFINITION
The market is defined as the financing, development, production and distribution of feature drama motion pictures, used by countries
around the world to entertain their citizens, with an emphasis on ages 18-60. The Company intends to capitalize on the exciting
developments of the dynamic entertainment marketplace.
The drama genre is a stable and strong market that provides for strong appeal with the adult audience and award potential greater than
any other motion picture genre. Drama has always maintained a loyal audience and will continue to do so. Since low-budget drama
movie are strong award winning candidates, the investments have strong upside potential vs. risk. The rise of successful award winning
low-budget drama properties such as “Martha, Marcy, May, Marlene,” “Blue Valentine,” “The Artist,” “Take Shelter,” and “Little Miss
3. Sunshine” have generated tremendous film festival and award buzz which spawned purchases and strong box office returns for a strong
ROI for the original financiers.
Recent comparable target models include:
Film
Distributer
Est.
Budget
U.S Box
Office Gross
Worldwide Box
Office Gross
Martha, Marcy, May Marlene (2011)
Fox Searchlight
$600,000
$2,981,638
$2,981,638
Take Shelter (2011)
Sony Picture Classics
$4,750,000
$1,723,811
$1,801,008
Winter’s Bone (2010)
Roadside Attraction
$2,000,000
$6,531,491
$13,831,503
Blue Valentine (2009)
The Weinstein Company
$1,000,000
$9,706,328
$12,355,734
Little Miss Sunshine (2006)
Fox Searchlight
$5,000,000
$59,889,948
$100,523,181
Boys Don’t Cry (2000)
Fox Searchlight
$2,000,000
$11,533,945
$12,680,450
INVESTMENT PROPOSAL
The Company is offering investors a hybrid investment structure of equity ownership in the Picture, as a limited partner and passive
investor, alongside 100% of the principal investment plus a preferred return of 20% of the investment compounded annually.
For their investment, equity investors (“Investment Partners”) investment recoupment will be scheduled as such; a 90%-10% split
between the investors and the producers of all net profits until investor has received 120% of their investment. The 10% to the producers
is to insure that we can continue to pay for the lawyers, accountants, and other related expenses in recouping all revenue generated my the
film.
• Once the Investors have recouped 120% for their investment then all subsequent net receipts will be divided 50/50, split between
investors and producers.
• All "Back-end" points and deferments will be deducted from the Producer's Profit.
EXIT / PAYBACK STRATEGY
The Company will implement strategic production partnerships and business relationships for the Picture, utilizing tax credits and
subsidies, branded content and product placement/corporate sponsorship; and domestic/international pre-sales in order to expedite
recoupment and insure the investment in the project. As soft monies return into the fold, via pre-sales, additional subsidies or assorted
contracts recouped early in the production process of the Picture, will serve to streamline all avenues to returning investment. With
20-30% of the true cost of the film already covered by discounted/deferred-fee production partnerships, favorable exchange rates, and tax
credits/subsidies, the remaining 70-80% equity exposed will be in first position against remaining revenue streams via distribution.
The Company itself will most likely max out its returns by the end of year seven, with most returns accumulated by end of year three into
year four. After the Company reaches the seven year mark it could either relicense the film to the same or another distributor, or sell the
distribution rights in perpetuity to a third party.
The Company anticipates 100%+20% payback within 24-32 months of first date of release. It believes it can achieve this because:
• The Picture is a cost-effective, commercial-intellectual property;
• The cross pollination between sponsorships, the online marketing world with the award season and the Picture will result in
massive exposure;
• Our entertainment contacts will align the Picture with the most salable foreign distribution outlets, entities, sales agents,
production partners, publicists and allies to effectively launch the Picture worldwide.
