Former key Carolco exec Rae Sanchini has joined James Cameron’s Lightstorm Entertainment as president at a time when speculation continues to mount over the indie’s financial health.
Sanchini replaces Larry Kasanoff, who last month left the company. His departure, which he attributed to a difference in company philosophy with Cameron, set off the current round of rumors regarding Lightstorm’s stability.
Cameron countered rumors still circulating in Hollywood this week that his $ 500 million multipic deal with several foreign partners, 20th Century Fox and United International Pictures, had been reduced to one costly pic.
“Everything is absolutely perfect and the deal is exactly the way itwas originally set up,” Cameron insisted. Sanchini chimed in: “We are fully funded on our slate.”
They were responding to speculation that the original deal with as many as 12 pictures would end up producing only the Arnold Schwarzenegger starrer “True Lies” set for a mid-August shoot and summer ’94 domestic release and helmer Kathryn Bigelow’s “Strange Days.”
Cameron insisted the focus now should be on Lightstorm’s positive new business direction under Sanchini, who will be responsible for all operations including film production and financing; distributor relations, exploitation of related ancillary rights and longterm strategic planning. She will also serve as exec producer on all Lightstorm films.
Still, the filmmaker wishes Lightstorm had never announced the $ 500 million, 12-pic figure last year.
“It was a projection to give eyecatching numbers, a substance. At the end of the day it was a 12-picmax agreement,” he said.
“Six to eight was always the contemplated number, over five years. We rounded the foreign deals down to nine,” he said. “Most of our territories have no minimums.”
Sources claim the $ 68 million budget for “True Lies” has ballooned to $ 75 million because of the 20% contingency fee required by the film’s completion bond guarantor International Film Guarantor.
“We’re not negotiating with IFG right now,” Sanchini said. “I can’t say they won’t be willing to buy the film for 10%,” given new support from Fox.
In a conference call, Cameron and Sanchini wouldn’t confirm the budget but said some funding problems were a direct result of “tremendously negative developments in the (completion) bond market generally.”
Insiders added that Fox also loaned Lightstorm cash, which some put at $ 10 million, to help keep the company operating. Other sources would not verify the amount but said the loan supposedly bought Fox territorial rights to France, as well as reduced licensing fees for the U.S. and Canada, where it is picking up 100% of the P&A costs.
Fox was originally supposed to put up a fixed percentage of the negative cost of each film up to a certain cap, estimated at around 30% of $ 50 million, or $ 15 million.
As for Lightstorm’s other strategic partners — Jugendfilm in Germany, Nippon Herald in Japan, Artisti Associati in Italy and UIP (a partnership between Universal, Paramount and MGM/UA) — discussions are allegedly under way for changes in the structure of the deal regarding their territories.
Under terms of the initial deal, Artisti guaranteed to contribute a reported 8% of production budgets, while Jugendfilm would put up 9% and Nippon Herald would put up 12.5%. UIP would put up 30%.
Those partners couldn’t be reached for comment. Fox sources said there was a meeting with Cameron three weeks ago and it appeared then the package was in trouble. But after Cameron’s session with Fox exex, the problems were ironed out.
“Foreign distribs are all very excited about our first two films, and we have no problem on that front whatsoever,” Sanchini said.
Sanchini left her position as senior VP of Carolco in October 1992 to work with Cameron, Scott Ross and Stan Winston in founding Digital Domain, the visual effects and digital production studio.
Asked why she chose Lightstorm, Sanchini laughed and asked Cameron for a raise, then said:
“I’ve worked for indies my entire career, and this is all about the talent behind them and I can’t think of anybody more talented than Jim Cameron,” who then promised her a raise.