By mid-September, after five lengthy rounds of negotiations, Helen Herman, representing Matthew, and Marvel Entertainment finally reached a consensus on most of the terms.
Surprisingly, it wasn't Matthew's side that was most eager during these talks but Marvel Entertainment. In preparation for filming "Iron Man," Marvel Entertainment had established Marvel Studios and set up its headquarters in Burbank, the hub of film companies and media groups.
However, Marvel Studios was mostly a shell organization at this point, apart from Kevin Feige being appointed as CEO. Lacking both experience and a proven track record, they found it difficult to recruit top talent from the film industry.
Financially, the situation was even more dire. "Iron Man" was slated to start filming in March next year, but its pre-production was underway with dismal presales and sponsorships. If additional funds were not secured, the project risked being shelved. Marvel Entertainment might even have to resort to mortgaging their intellectual properties to obtain loans.
Thus, Marvel was desperate for Matthew's $40 million investment to stabilize their operations. With this investment, persuading others to cover the remaining $20 million shortfall would become significantly easier.
While negotiating with Matthew, Marvel also had Kevin Feige continue discussions with Paramount Pictures. As the distributor for "Iron Man," Paramount's deeper involvement would likely ensure more dedication to the film's marketing and distribution, potentially resulting in more substantial resource allocation.
"In all likelihood, we should finalize the agreement with Marvel in our next meeting three days from now."
In the office of Angel Agency, Helen Herman updated Matthew on the latest negotiation developments. "Avi Arad and I have essentially reached a consensus. We plan to hold a joint press conference next Monday to sign the official agreement."
Matthew considered this and remarked, "Marvel probably wants to leverage my name for some early promotion."
Helen Herman responded directly, "Your influence, appeal, and sustained high visibility are all factors Marvel considered when accepting your investment."
Matthew understood. His $40 million investment wasn't just about the money; it also brought intangible influence to "Iron Man."
"And," Helen Herman continued, picking up a model of a Mercedes concept car from her desk, "Your ability to bring Mercedes-Benz on board as a sponsor played a significant role."
Matthew had previously suggested to Mercedes-Benz that they sponsor the film. Initially, Mercedes had reservations, but upon learning of Matthew's $40 million investment and given his impeccable track record in film selection, they expressed keen interest.
Naturally, like most Hollywood stars' sponsors, Mercedes-Benz's advertisement sponsorship would align with their spokesperson's involvement.
These were advantages that traditional bank loans couldn't offer.
Initially, Matthew had also considered Rolex, but they were less enthusiastic, and his status with them wasn't as prominent as it was with Mercedes-Benz.
However, for the struggling "Iron Man" project, having Mercedes as an ad sponsor could solve many issues.
"What about our conditions?" Matthew asked.
"In negotiations, some compromises are inevitable," Helen Herman fiddled with the model car and said, "Of course, Marvel has made some concessions too."
She didn't keep Matthew waiting and explained in detail, "You will hold the position of producer on 'Iron Man,' and you'll be the third most powerful producer after Kevin Feige and Avi Arad."
Matthew knew that what Helen Herman mentioned had already been agreed upon, so he stayed silent and waited for her to continue.
"Regarding third-party guarantees," Helen Herman said, "'Iron Man' will use FFI, the largest and most reputable guarantor in Hollywood. There's no need to change that. Marvel also agreed to use PricewaterhouseCoopers for third-party financial auditing, which will be detailed in a separate contract clause."
She set the concept car model back on her desk, "As for the number of subsequent films, it might fall short of your initial goal."
Matthew had anticipated this and said, "I initially aimed for ten but adjusted to twenty."
Helen Herman gave him a look, "That was the toughest point in the negotiations."
"I understand," Matthew replied thoughtfully. "If 'Iron Man' fails, Marvel wouldn't likely produce more superhero films independently in the short term. But if 'Iron Man' succeeds, the subsequent films would find it much easier to secure funding."
Helen Herman nodded, "Exactly. That's why Marvel wanted to cut this point. If it weren't for their urgent need for funds, we might not have reached an agreement. We only came to a satisfactory result as of yesterday afternoon."
Matthew's main concern was this aspect, so he directly asked, "How many films?"
"The negotiation reduced your number by two-thirds," Helen Herman said calmly. "Excluding 'Iron Man,' you have the first right to invest in the next seven Marvel superhero films that Marvel Studios produces, but your investment in each cannot exceed 20%."
"That's acceptable," Matthew counted on his fingers. Seven films should get him through to "The Avengers." "I'm quite satisfied with that."
He frowned slightly and reminded, "Helen, we need to be meticulous with the contracts. Cover all potential loopholes and traps."
While most Hollywood studios are committed to upholding contracts, disputes arise when significant money is involved. Peter Jackson, for instance, was still suing New Line Cinema over his director's fee for the "Lord of the Rings" trilogy.
"Don't worry," Helen Herman had already thought about this. "Wilson has gathered five seasoned entertainment lawyers to draft and review the contracts."
Matthew suddenly had another thought, "Also, include a clause ensuring that even if Marvel or its subsidiaries experience changes in ownership, they must guarantee my investment rights."
Marvel would eventually fall under the Disney umbrella.
Helen Herman took out a pen and jotted this down in her notebook. "I'll inform Wilson about this." She closed the notebook. "Regarding profit sharing, your investment will entitle you to a proportional share of the profits. However, this is limited to global box office, DVD and video sales, online video-on-demand, and television broadcast revenue."
Matthew frowned and asked, "What about other merchandise?"
Helen Herman shook her head, "Merchandise such as toys, action figures, extended comics, and character licensing are not included."
Matthew considered this and said, "Continue negotiating on these. We need to push for every possible category."
"I understand." Helen Herman acknowledged, pausing before speaking cautiously, "Matthew, I must remind you again that this investment is highly risky. If 'Iron Man' fails at the box office, you might not recover much of your $40 million."
Matthew smiled at Helen's words.
He could clearly see that Helen Herman, like most in Hollywood, didn't believe in Marvel's foray into the film industry. Her diligent negotiations were driven more by professional duty than optimism.
Matthew appreciated her concern. Over the years, she had repeatedly cautioned him about the risks.
Based on past experiences, Matthew believed that "Iron Man" had a much higher chance of replicating its previous success than failing. However, he couldn't explain this to Helen.
Such things were neither easily explainable nor believable.
Helen Herman noticed Matthew deep in thought and added, "It's not too late to back out now."
Matthew rubbed his forehead, finally finding the right words. Given that it was Helen, he felt obliged to explain.
"Don't worry, Helen. I know what I'm doing," Matthew said firmly. "My investment in 'Iron Man' isn't impulsive; it's the result of careful consideration."
Before Helen could respond, he continued, "Why do mainstream Hollywood commercial films break through cultural and language barriers to become globally popular? Because visual spectacles transcend those barriers. Thus, the biggest demand in the global film market remains for blockbuster visual spectacles. With technological advancements and increasing capital, comic book stories are prime material for these visual blockbusters. I believe that now and in the foreseeable short-term future, superhero films will be the focus of Hollywood's major productions."
Helen Herman blinked instinctively, her usually calm face showing a hint of surprise. Her bright blue eyes examined Matthew up and down.
"Please don't look at me like that," Matthew said, spreading his hands in mock frustration. "I've been learning all these years. I'm no longer an ignorant idiot."
Helen Herman seemed to understand that Matthew was unlikely to abandon this investment. She didn't try to dissuade him further and smoothly shifted the topic.
"Let's discuss the Armani underwear endorsement," she said, returning to her calm demeanor. "This is our next major target."
Matthew collected his thoughts and asked in confusion, "Didn't you say last time that David Beckham was the frontrunner?"
Helen Herman crossed her hands on the table, "David Beckham has encountered some issues in Europe. I met with Pye Kinsley recently. She still harbors resentment over being fired by Tom Cruise."
For some reason, she felt an urge to laugh, "You have a significant advantage. Once the trailer and your character posters for '300' are officially released, Armani will likely consider you their top candidate."
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