Business Finance Homework Help

You are producing an elevated genre R-rated thriller independent feature film starring Zoe Saldana and Ben Affleck, with an excellent sales agent whom you are paying a sales commission of 10%. There is a commitment to release the film from Open Road on no less than 1,500 screens domestically. The project has (i) three major European territory pre-sales in place (with quality distributors that have excellent credit histories) totaling US$5m gross, (ii) a refundable credit production incentive from the Federal government and Province of British Columbia in Canada totaling Can$4 million, and (iii) unsold ‘take’ international sales estimates of US$8 million (after deducting the commission of the sales agent). What do you think the gross production budget of the film should be in US dollars? Please explain your answer and show the core assumptions underlying your analysis, including how much senior secured debt you think a bank senior secured lender might provide to cash flow the production and the individual collateral components of the loan. Your answer should also include (i) a financial comparables analysis of equivalent releases within the past 5 years and their average or median domestic box office, and (ii) a net domestic revenue calculation based upon that average domestic box office and all the domestic revenue windows for the film less all the domestic fees and expenses against the film.