SAG-AFTRA Interim Agreements Challenge Indie Financing Models at AFM – The Hollywood Reporter

Getting an independent movie made these days is hard enough but for producers piling into the halls of Santa Monica’s Le Méridien Delfina Hotel for the American Film Market this week, the SAG-AFTRA strike has added another layer of complication.

SAG-AFTRA’s Interim Agreements, or IAs, the contract required for independent producers to produce or talent to promote movies during the ongoing actors strike, have made packaging and deal making tricky, with many filmmakers uncertain when, even if, projects they are offering at AFM will be able to shoot.

“We have our cast set for Worldbreaker but we just have to wait for the end of the strike before we can actual get those deals done,” said director Brad Anderson, at AFM to pitch international buyers on his new dystopian sci-fi thriller, which The Exchange is selling. “Like most filmmakers, I’ve been sitting around not able to do anything while we wait for the strike to be resolved.”

The Exchange has secured an IA for another of their AFM projects, the true-crime biopic The Leader, about the 1997 Heaven’s Gate mass suicide, which stars Tim Blake Nelson and Vera Farmiga. But company CEO Brian O’Shea notes the terms required to secure an IA, which include agreeing to SAG-AFTRA’s proposal for actors residuals —proposals the productions association the AMPTP have yet to sign off on — can make the interim agreements a risky proposition.

“We don’t know what the final residual figure will be, what number to put into our budgets for actors residuals,” says O’Shea. “That’s a big problem for independents because two or three percentage points on the residuals can make the difference between getting a film made or not.”

Antother stipulation in interim agreements, that producers do not sell their projects to AMPTP members, further complicates matters.

“If you get an IA to shoot, you are taking [AMPTP members] the studios and streamers off the table,” says David Garrett, Mister Smith Entertainment. “It removes a lot of options, so your financial plan has to be perfect.”

Many dealmakers claim IAs were a major factor depressing sales at the Toronto International Film Festival in September. Prior to the fest, multiple studios warned that they would not be purchasing titles that had signed interim agreements, and the lack of sales, even months after the festivals wrapped, could indicate that the studios made good on that assertion. The biggest titles to sell out of TIFF did not sign IAs, including Richard Linklater’s Hitman and Anna Kendrick’s directorial debut Woman of the Hour, which both landed eight-figure deals with Netflix.

But other insiders note that multiple projects that did not sign interim agreements also failed to land deals, suggesting the blame for the sluggish TIFF market can’t put squarely on IAs. And a number of IA-approved films, including Michael Mann’s Ferrari and the Sophia Coppola-directed Priscilla, both of which premiered in Venice, sold strongly, with Ferrari securing a domestic deal with Neon and STX International. Priscilla producers A24 also did one of the few IA-approved buys out of TIFF, taking rights for the prison drama Sing Sing starring Colman Domingo.

“We’ve been able to get interim agreements for [Angelina Jolie period biopic] Maria and [Tom Hiddleston/Mark Hamill starrer] The Life of Chuck to begin production, it hasn’t created any major issues stopping us to to move forward with with the projects,” noted Alice Laffillé, vice president, international sales at FilmNation. Two of Filmnation’s hottest AFM titles, psycological thriller The Process starring Halle Berry and actioner Novocaine with Jack Quaid, are pitching to buyers with IAs in place.

Lionsgate, which is not a member of AMPTP, has also embraced IAs — the company secured an interim agreement for its The Hunger Games: The Ballad of Songbirds & Snakes to let the film’s cast, including Rachel Zegler, Peter Dinklage and Viola Davis do promotion for the film ahead of its November 17 release —and the mini-major has been active in the market, both as a buyer and seller. Lionsgate has argably the biggest title on offer at AFM this year: Chad Stahelski’s Highlander Reboot starring Henry Cavill.

“Independents find a way, that’s what we do,” says O’Shea. “But there are not as many projects at AFM and they are not as big. People are still trying to figure everything out.”