Under a completion guarantee, the guarantor is not liable for any payments under the guarantee until certain condition precedents have been satisfied. In the completion guarantee there are certain conditions whereby the completion guarantor is under no obligation to make any payments until an amount called the 'Strike Price' has been paid into the production bank account. The Strike Price is the total amount of contributions by the financing parties of a production that the guarantor will agree to protect. From a financier's or bank's perspective they will want the Strike Price to be the same amount of money that they are providing in relation to the film. In circumstances where there is more than one financier, the completion guarantor will not accept any financial responsibility until the entire budget of the film has been funded. Under a completion guarantee, one of the condition precedents is that the fee payable to the guarantor is paid either at the start of principal photography or upon signature of the agreement.
Completion guarantees usually have a schedule that sets out specific completion and delivery issues in relation to the film. These usually make reference to various agreements of broadcasters and distributors or others that are liable for payment upon delivery.
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