Theatre and Associate Producers

THEATRE: ASSOCIATE PRODUCERS

An associate producer is typically responsible for furnishing some or all of the front money, raising part of the capital needed to produce the play (or using his or her best efforts to do so), or making an important contribution to the theatrical production. This could be finding the play (or musical) to produce, securing the rights to produce the play, or obtaining a major star’s commitment to appear in a role.

An associate producer’s agreement will specify his or her responsibilities. If the associate producer is obligated to raise production money, the amount should be specified. The agreement should require the associate producer to comply with applicable securities laws. To avoid implicating securities laws, the associate producer may be required to assist the producer in raising money but prevented from offering or asking any person or entity to be an investor. New York has specific rules and regulations regarding what front money may be used for and the number of offerings that can be made. If the associate producer is signed on after the securities filings have been completed, an amendment to those filings is required. In some states, the producer will have to offer to return any investments made prior to the amendment. When the associate producer contributes money, the associate producer is entitled to share in a portion of the producer’s profits. The standard sharing formula is that the associate producer receives one percent of the producer’s share of the profits for each specified percent of the production company purchased by the associate producer’s contributions.

The agreement will also specify the terms of the associate producer’s billing credit. These terms can include the circumstances under which the associate producer will be entitled to receive such credit, where the credit will be placed, the type or size of the font used to display the associate producer’s name, and the prominence of the billing credit relative to the producer’s billing credit.

The associate producer’s agreement has to be consistent with the terms of the producing entity’s operating agreement. Where the associate producer’s agreement is in conflict, the associate producer may have to agree that the producing entity’s operating agreement controls.

The associate producer may (but more often does not) have authority to act on behalf of the producing entity if it is formed as a limited liability partnership; however, the associate producer will not incur personal liability for its acts. For this reason, limited liability partnerships appear to be the preferred method of structuring the producing entity because the partnership members are not exposed to personal liability.

An associate producer who invests money in the production will usually receive a specified percentage of the producer’s share of net profits. The percentage is negotiable, but is typically a three percent share for each one percent invested in the overall production budget.