COLLABORATIVE ARRANGEMENTS

12 Months Ended

Dec. 31, 2011

COLLABORATIVE ARRANGEMENTS

COLLABORATIVE ARRANGEMENTS

3. COLLABORATIVE ARRANGEMENTS

Joint Marketing VFX Services Agreement

        On July 8, 2011 Digital Domain Productions, Inc., a wholly owned subsidiary of our subsidiary Digital Domain, entered into a Joint Marketing and Production VFX Services Agreement with RelianceMediaWorks Limited ("RMW"), a film and entertainment services company headquartered in Mumbai, India. The term of this agreement is three years, subject to Digital Domain Productions, Inc.'s option to extend for a fourth year. Pursuant to the terms of this agreement, RMW is responsible for creating and staffing studio facilities in both Mumbai and London, England, through which Digital Domain Productions, Inc. is to provide VFX services to its clients worldwide. In consideration of RMW's obligation to provide Digital Domain Productions, Inc. with turnkey studio facilities in these two cities, Digital Domain Productions, Inc. has agreed, pursuant to the terms of the agreement, to guarantee to RMW specified minimum monthly levels of production revenues generated at these facilities from Digital Domain Productions, Inc.'s VFX projects, in the following estimated annual amounts, based on the U.S. dollar/British pound exchange rate as of December 31, 2011, as applied to those payments under the agreement denominated in British pounds: $17.5 million for the first year of the term of the agreement, $26.6 million for the second year of such term, and $26.2 million for the third year of such term.

Co-Production in Feature Film Project

        On February 15, 2012, the Company entered into an Investment and Production Agreement with Ender's Game Holdings LLC ("EGH") and OddLot Entertainment LLC ("OLE") effective as of April 18, 2011, to provide financing and production services to co-produce the VFX action movie Ender's Game. Principal photography for Ender's Game began February 27, 2012, in New Orleans. The picture has a production budget slightly in excess of $100 million and is scheduled for theatrical release in Spring 2013. Distribution services are to be provided by Summit Entertainment. As of March 16, 2012 the Company and DD had collectively provided $12.1 million in financing. See Note 11 for further discussion.