The Independent Production Agreement requires the payment of a Distribution Royalty based upon Distributors' Gross Revenue toall credited Writers as provided in Article C11 of the IPA.  Such Royaltypayments are made at least annually and as per the required reporting periodand must be accompanied by a statement of all Distributors' Gross Revenue inaccordance with the following Distribution Royalty Payment Form.  Insurance andRetirement contributions and Writer deductions must be remitted in relation toDistribution Royalty payments.  In the case of a limited company, certificationmust be by an officer or director of the company.

The Distribution Royalty Payment Form contains separate first pages for single productions and series. All subsequent pages are to be included for all projects.

In accordance with the terms of the Distributor's Assumption Agreement:

1. a Distributor shall be under no obligation to pay Distribution Royalties pursuant to the IPA and this Distributor's AssumptionAgreement until such time as the aggregate Distributors' Gross Revenue exceeds one hundred percent (100%) of the Budget, and

2. if more than one party (i.e. the Producer and one or more Distributors, or more than one Distributor) reportsDistributors' Gross Revenue for a project, for the reporting period that coincides with the point where Distributors' Gross Revenue exceeds one hundred percent (100%) of the total Budget the Guild shall notify the Producer and all Distributors who have signed a Distributor's Assumption Agreement of the pro-rata portion of Distributors' Gross Revenue to be reported by the Producer and/or each Distributor for inclusion on the Distribution Royalty Payment form.

DISTRIBUTION ROYALTY PAYMENT FORM
(see following)