Project Equity

Purpose

Empower members to build equity in The Collective by contributing “sweat equity”: the value of the difference between standard market rates and the Collective Rate, on eligible film and television projects. This approach reduces the need for up-front cash expenditures in production budgets while allowing members to accumulate ownership through their creative and technical contributions.

Background & Rationale

JUYAA vision is the development sustainable production models for indigenous Caribbean content. To achieve this, we must adopt innovative strategies that maximize limited funding while expanding our production capacity.

In independent filmmaking, crews often accept reduced pay to bring projects to life sometimes compensated through promised revenue-share, but more often driven by goodwill and passion, despite the reality that most projects may never turn a profit. However, in today’s economic climate, goodwill alone is no longer sufficient.

By introducing a structured cooperative model, we can transform that goodwill into measurable, distributable value. This approach enables equitable profit sharing, collective risk management, and shared success across multiple productions similar to a diversified investment portfolio.

As members take greater control over production budgets and financial decisions, we increase our capacity to produce high-quality work more consistently. This financial stewardship also gives The Collective a stronger voice in shaping industry practices and improving working conditions.

Finally, a dividend distribution structure will over time help smooth income volatility, offering members greater financial stability and a more sustainable career path in the creative industries.

Rates

Rate Card Publication

  • The Collective will publish an annual Standard Commercial Rate (SCR) Schedule by country/role/experience level, this will be done in collaboration with local Industry Associations.
  • Calibrate from recent market quotes, union minimums (if applicable), independent research and regional benchmarks.
  • Update annually with changes applying prospectively.

    Collective Rate Setting

  • Typical discount band: 15%–40% below SCR, tailored per cashflow and project budget.
  • CR must be above any legal minimums or union floors.

    Eligibility

    Member Eligibility

  • Only approved worker-members in good standing may participate in the equity-for-discount programme.
  • Members must have signed the Member Equity Agreement and any relevant Project Participation Addendum.

    Production Eligibility

    To qualify for the programme, a production must meet the following criteria:

    Revenue-Generating Intent

    The production must be designed and structured to generate back-end revenue, including but not limited to:

  • Licensing or distribution deals (domestic or international)
  • Streaming platform monetization
  • Broadcast syndication
  • Theatrical release with box office potential
  • Ancillary rights (e.g., merchandising, soundtrack, format sales)

    Ownership & Participation Rights

  • The Collective must retain ownership, profit participation, or producer fee rights that entitle it to a share of future revenues.
  • The Collective’s equity stake will be at the same repayment level as cash investors.
  • Projects must have a clear revenue waterfall or recoupment structure that includes The Collective as a beneficiary.

    Commercial Viability Assessment

    Each project must undergo a commercial viability review by The Collective’s board or designated sub-committee, assessing:

  • Market potential
  • Distribution strategy
  • Audience reach
  • Budget-to-revenue ratio
  • Sales projections or comparable titles

    Minimum Budget Thresholds

    Projects must meet minimum production budget levels that support professional execution and market competitiveness. Lower-budget projects may be considered if they have confirmed distribution or revenue guarantees.

    Collective Affiliation & Control

    The project must be produced by, or in partnership with, The Collective or a Collective controlled entity (e.g., SPV), ensuring alignment with The Collective’s values and financial participation.

    Member Participation

    The project must offer meaningful roles to Collective members across key creative and technical departments, with a minimum threshold of 50% crew composition from The Collective’s membership.

    Board Approval

    Final eligibility is subject to Board or relevant Sub-Committee approval, based on the above criteria and alignment with The Collective’s strategic goals.

    Share Valuation & Pricing

    Share Price (SP) Windows

  • Establish semi‑annual pricing windows.
  • During each window, all conversions use the same SP.

    Anti‑Dilution & Floors

  • Optionally add a price floor or collar to prevent sudden dilution swings.
  • Communicate clearly before each window opens.

    Conversion Mechanics

    Accrual

    For each approved timesheet/invoice line:

  • Discount Amount (DA) = Billable Units × (SCR – CR)
  • Accrue DA into the member’s SEB.

    Conversion to Shares

    At the end of each pricing window (or monthly if you prefer):

  • Shares Issued = DA_converted ÷ SP
  • You may allow partial conversion (e.g., convert 80% and carry 20% forward) to smooth SP changes.
  • Define a minimum conversion threshold (e.g., $250 equivalent) to reduce admin overhead.

    Example 

Role: Editor, SCR = $650/day; CR = $450/day.
10 days on Project A → DA = 10 × ($650 – $450) = $2,000.
SP this window = $5.00/share.
Shares Issued = $2,000 ÷ $5.00 = 400 shares to member’s equity account.

Project‑Level Rules

Project Approval

Projects eligible for the program must be approved by the co‑op board/steering committee with:

  • Budget & cashflow prepared by approved Line Producer
  • Proposed Collective Rate bands by department
  • Target conversion window (SP period)
  • Any union/collective agreement confirmations

    Recoupment & Waterfall (if using SPV/LLC)

    If you run productions through a project SPV:

  • The Collective invoices the SPV at CR.
  • Members accrue DA with The Collective, not the SPV.
  • Project revenues flow: Distributor → SPV → (recoup debt/cash investors first) → Collective producer fees/overages.

Keep the equity program at the co‑op level for simplicity; reserve separate profit participations for project investors.

Governance & Bylaws Alignment

  • Amend bylaws to authorize issuance of ordinary shares for services under a board‑approved program.
  • Define voting vs non‑voting ordinary shares, or create a worker‑member class that holds votes while investors may hold non‑voting.
  • Cap table authority: designate a Registrar (e.g., Secretary) and a Quarterly Pricing Committee (3 members; conflict of interest rules).
  • Adopt a Member Equity Agreement and Participation Addendum per project.

    Legal & Compliance Checklist (summarized)

  • Securities law: Ensure exemptions for services-for-shares to members; restrict transferability; use legends; provide risk disclosures.
  • Employment law: If members are employees, confirm you’re not displacing required wage minimums; DA cannot reduce below legal minimums or union floors.
  • Tax: Confirm treatment of shares issued for services (possible ordinary income at FMV on issuance) and recordkeeping for member tax slips (e.g., 1099/ W‑2 equivalents, T4A, etc., per jurisdiction). Consider 83(b)‑type elections if vesting is used.
  • IP: All work-for-hire and assignment clauses route IP to the co‑op or project SPV as appropriate.
  • Valuation policy: Board‑approved document; retain calculation workpapers.
  • Audits: Annual financial statements; equity roll-forward reconciliation.

    Risk Controls & Practical Rules

    Caps & Limits

  • Annual member cap on DA (e.g., max $25k equivalent/year).
  • Project‑level DA cap as a % of budget (e.g., ≤ 10% of total below‑the‑line).

    Vesting (Optional)

  • To align with project completion: e.g., 50% vests at picture lock, 50% at delivery/acceptance.
  • Unvested portion forfeits if member quits for cause.

    Clawbacks

    If material breach, misrepresentation, or gross misconduct, the board may cancel unissued shares or repurchase issued shares at nominal value (subject to law).

    Liquidity & Redemptions

  • Ordinary shares are not redeemable on demand.
  • Offer limited annual redemption windows (e.g., up to 5% of total outstanding) at Board‑set NAV, subject to cash tests.

    Non‑Members

    Non‑members can: (a) get full cash; (b) accept reduced CR + profit-share (not equity); or (c) apply for membership to join the equity program.

Worked Example (End‑to‑End)

Scenario:

DP works 12 shoot days. SCR = $1,200/day; CR = $900/day → DA/day = $300. Total DA = 12 × $300 = $3,600. Quarter’s SP = $6.00/share. Shares issued = $3,600 ÷ $6.00 = 600 shares.

Accounting:

Cash expense: 12 × $900 = $10,800. Equity reserve (liability) accrues: $3,600. On issuance: debit reserve $3,600; credit common equity (600 shares @ $6 FMV).