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ARTICLE A10 - SECURITY FOR PAYMENT
| ARTICLE A10 - SECURITY FOR PAYMENT |
| A1001 |
The Guild is
entitled to require a Producer to post, no earlier than thirty (30) days before
the commencement of principal photography, security for payment sufficient to
cover: a) the Production Fee, and b) insurance and retirement payments required
under this Agreement. The said security shall take the form of a cash
deposit to be held in trust by the Guild, in an interest-bearing account, and
all the accrued interest shall be the property of the Producer. At the
Producer’s election, the security for payment may take the form of one or more
irrevocable letters of credit in favour of the Guild, drawn on a Canadian
chartered bank. The face of the letter of credit shall specify that:
- the
Guild shall be entitled, upon written notice to the Producer, to draw down on
the letter of credit. The letter shall stipulate the amount claimed and that
such amount is due to the Guild as a result of default by the Producer of its
payment obligations as specified in the Agreement;
- the
said letter of credit shall have a term commencing not sooner than thirty (30)
days prior to the commencement of principal photography and terminating at a
mutually agreed date after the completion of principal photography;
- in
the event of a dispute involving outstanding payments due under the Agreement,
the Producer agrees to reissue a letter of credit or to post a bond in an
amount equal to those amounts in dispute for as long as those amounts remain in
dispute; and
- when
a bona fide dispute arises, all remedies and recourses provided by this
Agreement shall be exhausted, or an Arbitrator shall rule in favor of the
Writer prior to any disbursement from the Security Payment.
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| A1002 |
The provisions of
A1001 (iii) and (iv) shall apply equally to a bond.
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| A1003 |
Notwithstanding
Article A1001, an Established Producer as defined herein shall not be required
to post as security a cash deposit, letter of credit or bond, but shall instead
be entitled to provide to the Guild a corporate guarantee in the form provided
in Appendix M.
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| A1004 |
An Established Producer shall mean a Producer:
- whom
the Association confirms by written notice to be a member in good standing;
- who
has maintained an active production entity with established offices and staff
for the previous four years, and has engaged Guild members for a minimum of
eight hours of completed programming; and
- who
has had a good track record for payment of Guild members excluding minor
infractions
- a
Producer who is wholly-owned by a production entity which meets the above
criteria.
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| A1005 |
The Producer
shall give the Guild notice within thirty (30) days prior to the start of
principal photography of its intention to provide a corporate guarantee.
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| A1006 |
Should the option
for a corporate guarantee be denied, a timely request having been made, the
Producer shall have recourse to the following appeal procedure:
- the
Guild meet with the Producer within five (5) business days of denial of a
request;
- an
appeal committee shall be formed which will consist of the Director of
Industrial Relations of the Guild and a representative of the Association;
- should
there be no consensus at this meeting, the Producer shall post the cash bond
required by the Guild as a gesture of good faith pending the outcome of
presenting its case in front of the Joint Standing Committee as set out in
Article A5 of this Agreement; and
- should the Joint Standing Committee rule in the
Producer’s favour, the Guild will immediately return the cash bond, with
interest if applicable, and accept the alternative security payment agreed to by the Joint Standing Committee.
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