Investment Structure & Reg D 506(c) Terms

Regulation D Rule 506(c) Offering

The Violinist is offered under Regulation D, Rule 506(c) of the Securities Act of 1933 to verified accredited investors, family offices, and brand co-financiers. Rule 506(c) permits general solicitation, but it requires the issuer to take reasonable steps to verify accredited status — meaning every subscriber completes third-party verification (CPA, attorney, registered investment adviser letter, or documentary review) before an allocation is confirmed. Accredited status is defined by SEC Rule 501 and Section 2(a)(51) of the Investment Company Act.

The film budget is fixed at $5 million and includes U.S. theatrical distribution costs. The minimum investment is $100,000 for individual accredited investors; family offices and brand co-financiers typically participate at $500,000 and above. Securities are illiquid, are not registered, and cannot be resold absent registration or an exemption.

120% First-Dollar Priority Return

Investor capital sits at the front of the waterfall. Distributable proceeds repay investors 120% of contributed principal on a first-dollar basis before any producer participation is paid. Only after that priority return is satisfied in full do remaining net revenues split 50/50 between the investor class and the producer class, and that participation continues across every subsequent global revenue window for the life of the film's exploitation.

In practical terms: a $100,000 subscription is entitled to $120,000 of priority distributions before producers participate, and thereafter shares pro rata in half of all net proceeds. Projections are illustrative; no return is promised and revenue outcomes are uncertain.

Global Revenue Streams

Independent film income is not a single event. The waterfall is fed by U.S. theatrical exhibition; international sales and licensing across 50+ territories, typically sold territory-by-territory through a sales agent at markets such as the AFM, EFM, and Cannes Marché; global streaming and transactional VOD; free and pay television windows; airline and hospitality licensing; music and soundtrack exploitation; and merchandise and ancillary rights.

Because these licenses renew and re-window over many years, a completed film behaves less like a single-exit venture position and more like an income-producing intangible asset with a long tail — provided the underlying distribution is competently arranged. This is the mechanism that allows a stand-alone film to generate passive global income for its investors rather than a one-time payout.

IRS Section 168(k) Bonus Depreciation

Qualified film and television productions may be eligible for 100% first-year bonus depreciation under IRS Section 168(k) where at least 75% of principal photography compensation is incurred in the United States. For a taxpayer with offsetting income, that treatment can accelerate the deduction of qualifying production expenditure into the year the film is placed in service, materially reducing effective at-risk capital. Eligibility, passive activity limits, and at-risk rules are fact-specific — every prospective investor should model the outcome with their own CPA or tax counsel.

Risk Mitigation Stack

Capital protection is layered before box office performance ever matters: state and national production tax credits and rebates in the 30–40% blended range in the jurisdictions under consideration; international pre-sales and minimum guarantees negotiated ahead of production; a committed U.S. theatrical distribution path; completion and production insurance; and the Section 168(k) treatment described above. Together these are structured to retire a substantial portion of the budget independently of audience results.

Risk Disclosure

Film investment is speculative and illiquid. An investor should be prepared to lose the entire amount invested. Risks include but are not limited to: failure to complete financing, production delay or abandonment, cost overrun, loss or unavailability of key talent, failure to secure or maintain distribution, weaker-than-modeled licensing or theatrical performance, changes to tax credit programs or federal tax law, currency and counterparty risk in international licensing, and the absence of any secondary market for the securities. Past performance of comparable films is not indicative of results for this production. Nothing on this site is an offer to sell or a solicitation of an offer to buy securities; any offer is made only through the confidential offering memorandum and subscription documents to verified accredited investors.

Next Step

Request the offering memorandum to review the full financial model, waterfall schedule, budget, and distribution plan, or contact investor relations directly. Background reading is available in the film finance learning hub and the investor FAQ.