Great Article on how movies are financed and how good movies don't get made.

[GreenScar]

The headline of the article is that the Justice League Movie is getting another chance due to George Miller getting his deal revamped.

What's interesting is it details how "Movie Stars" can no longer demand the paydays the once did if the script is good. Look at some of these quotes:

In deal-making parlance, it’s a shift to “cash break deals,” from the once-common practice of giving top talent as much as 20% of the first-dollar gross.
In other words, star actors — as well as big-name writers and directors — are being forced to wait until a movie recoups its costs, rather than enjoy a portion of the first dollar that a project takes in.
These types of deals have long been common in the specialty business, but now are being applied to pictures with much higher budgets.

One recent example is the Warner Bros. comedy “Yes Man,” which stars Jim Carrey and opens Dec. 19. It was made possible only after Carrey waived his $25 million fee, and agreed to a gross payday to be collected when the film recoups its costs. After that, he would receive 33% of all revenue, and a one-third split of 100% of DVD revenue.
Had Carrey not agreed to the deal, the $50 million film may have hovered around $80 million.

M. Night Shyamalan, for example, got an eight-figure upfront salary for “The Happening,” released on June 13. He also has a 25% ownership stake in the film, but won’t reap dividends until co-financiers Fox and UTV recoup their $60 million budget, along with P&A and interest. At that point, Shyamalan will get 50% of the film’s revenue stream.

Paramount’s deal on “Indiana Jones and the Kingdom of the Crystal Skull” allows the studio to recoup production costs, and a 12.5% distribution fee, before giving 87.5 cents on each dollar to profit participants George Lucas, Steven Spielberg, Harrison Ford and David Koepp. They agreed to get a windfall only after the film hit $400 million worldwide, according to a report in the Los Angeles Times. (The film is closer to $500 million at this point.)

Talent may not like the deals, but the alternative is that the project might not be made. Sources say Warner Bros.’ upcoming “Body of Lies” came about after stars Leonardo DiCaprio and Russell Crowe, director Ridley Scott and producer Donald DeLine agreed to split 40 cents of each dollar, but only after the studio recoups its costs.

Fox put its foot down with the movie “Used Guys,” which was to have been directed by Jay Roach and to have starred Ben Stiller and Jim Carrey. The studio scrapped the project when the creatives declined further cuts in their gross deals.
Universal and Fox backed out of a feature version of the Microsoft vidgame “Halo,” which was to be a multi-step deal that included gross payouts of more than 20% to the tech giant and the film’s producers.

Check out the entire article here. It's a good read.