CAIC(Cash Accumulation Insurance Contracts)
Available through
Geneva Media Holdings, LLC
T H E C A S E S T U D Y
In simple terms, how does CAIC work?
Cast and crews are bonused a salary
The salaries “double” state film tax credits
A “restriction” is placed on each salary bonus
Restrictions are removed at “break even”
This provides loan collateral and liquidity
CAIC also insures a cast and crew’s
families (from disability and death)
Srvs. Credit = $ 18,750,000
Picture Sub. = $ 18,750,000
Labr. Credit = $ 18,750,000
C.T.C. = $ 15,000,000
F.R. = $ 13,750,000
C.V. = $ 75,000,000
All Collateral = $ 150,000,000
$150M LP
$75,000,000 $75,000,000Negative Cost Insurance Cost
CAIC
$300M FACE
AMOUNTS
$75MCASH
VALUES
$75,000,000Negative Cost
LP spend: $75,000,000Negative Cost
Studio spend:
$150M Slate
25% Profits 75% Profits
100% break-even for bank or equity facility
Retain F. A. + $ 300,000,000( FAMILIES PROTECTED W/ $300M IN BENEFITS)
Hit films? C.V. $ 150,000,000( FAMILIES AND FUND RUNNERS RETAIN $150M)
If the film facility breaks even, the fund keeps $150,000,000!
M.G.A. = $15M to $ 30,000,000
T H E C A S E S T U D Y
100% SAFETYregardless ofbox office or
ancillary sales!
T H E C A S E S T U D Y
The Crew♀♂ ♀♂ ♀♂ ♀♂♀♂ ♀♂ ♀♂ ♀♂
$
TAX FREE
CASHTO FAMILY
The Funding Entity:Pension Funds, V.C.s Hedge Funds, Banks,
Private Equity, but NOT a film studio!
Single Picture LLC
Single Picture LLC
Single Picture LLC
Single Picture LLC
The Funder$ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $
$
CollateralProtection
Media Mitigation Holdings, LLP
Who owns the CAIC --so it qualifies as deductible?
The Funder$ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $
$
TAX NEUTRAL
CASH TO FUNDER
T H E C A S E S T U D Y
The Crew♀♂ ♀♂ ♀♂ ♀♂♀♂ ♀♂ ♀♂ ♀♂
The Crew♀♂ ♀♂ ♀♂ ♀♂♀♂ ♀♂ ♀♂ ♀♂
The Funder$ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $
Who owns the CAIC --so it qualifies for perfection?
T H E C A S E S T U D Y
Media Mitigation Holdings, LLP
CAIC
98% L.Partners
Crew exchanges a partialCollateral Assignment
of the Cash Accumulationsfor a L.Partners’ interest
Policyowner
Major Bank
1% G.P. Owner
Film LP
Bank / Funder
G.P.s control theCollateral Assignment
and all Cash AccumulationA+ Insurer
$
$
1% G.P. Owner
1+1% G.P.
A+ Insurer
Major Bank
C a s t and Crew
Labor & Serv Costs
Families
Slate Fund
Studio / Network
$
$ 35%- 65% Tax Credits!
$CAIC$$$$$$$$$$$$$$
$
$SAFETY!
T H E T O O L
50%
50%
Insurance Premium Costs
Film LP
Hedge Fund
25% to 35% tax incentives for financial service costs (including L&H and P&C insurance premiums and banking fees) from all qualified lenders or carriers that are commercially domiciled in over 20 states (GA, LA, IL, FL, NM, PA, CT, CA)
Productions in a number of U.S. states (and Canadian provinces) also offer: 25% to 65% qualified production labor credits; and an additional 2% to 12% additional labor incentives, or for filming in areas of economic impoverishment
T H E T O O L
What does the structure achieve?
Protects media investors from loss
Helps increase capital at major studios
Provides true, film/TV slate, risk mitigation
Creates millions in new media spending
Provides loan collateral and liquidity
Protects the film’s cast and crew
T H E T O O L
T H E T O O L
What is the legal basis of the CAIC structure ?
IRS tax code 264(a)(1) – L&H cost deductions
Simple employee insurance benefit (162 Bonus)
Restrictive Executive Benefit Agreement (REBA)
50 years of proven COLI, BOLI and NQDC contracts
IRS tax code 181 and 199 film tax deductions
US and Canadian theatrical film tax credits
T H E T O O L
T H E T O O L
Year
States with Film Incentive Program
Incentive Amounts
Offered
1999 and earlier
4 $2 million
2000 4 $3 million
2001 4 $1 million
2002 5 $1 million
2003 5 $2 million
2004 9$68
million
2005 15$129
million
2006 24$369
million
2007 33$489
million
2008 35$807
million
2009 40$1.247 billion
2010 40$1.396 billion
2011 37$1.299 billion
Source: Tax Foundation.org, Movie Production Incentives
US
T H E T O O L
Year
States with Film Incentive Program
Incentive Amounts
Offered
1999 and earlier
4 $2 million
2000 4 $3 million
2001 4 $1 million
2002 5 $1 million
2003 5 $2 million
2004 9$68
million
2005 15$129
million
2006 24$369
million
2007 33$489
million
2008 35$807
million
2009 40$1.247 billion
2010 40$1.396 billion
2011 37$1.299 billion
Source: Tax Foundation.org, Movie Production Incentives
U.S. FILM TAX
INCENTIVE AMOUNTSARE STILLGROWING: $2B+ IN
2013.
US
T H E T O O L
Source: Weiss Research, American and Canadian L&H Company ratings, May 2012
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• Geneva Media Holdings LLC: (a risk mitigation consulting firm established in California in 1989, and incorporated in 1994) 9171 Wilshire Blvd #670, Beverly Hills, CA (424) 666-8769
• We support accounting, financial, legal and tax advisors
• Offices; Beverly Hills, CA. Lake Forest, IL (100+ partners)
• We are top underwriters and experienced in working with:
– Media verticals (e.g., Tribune Media… etc., since 1978)
– Bell-Phillip TV (e.g., Y & R… CBS… etc., since 1989)
– Other key client work (e.g., Kohl’s… Pritzker’s… etc.)
– Advanced financial, tax, estate and NQDC planning
– Administration for COLI, BOLI, CAIC and key-man
T H E I N D U S T R Y L E A D E R S
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