PARK CITY, Utah — After an intense all-night negotiating session, Miramax has beaten out several competitors in a high-stakes bidding war for worldwide distribution rights to director Mark Illsley’s comedy “Happy, Texas.”
While the outcome was hardly a shock to veteran Sundance observers, the reported details of the deal left rival acquisition execs shaking their heads with amazement — and, in many cases, disbelief.
Competing bids for the quirky pic exceeded $10 million, but, according to Miramax execs, the minimajor walked off with it for a minimum guarantee of just $2.5 million plus a substantial first-dollar gross participation for the filmmakers.
That claim sparked intense skepticism among some observers, especially from other execs who had sought to acquire the film.
Among those pursuing the Jeremy Northam/William H. Macy starrer were Fox Searchlight, Cary Woods’ Independent Pictures (which has a domestic output deal with New Line Cinema), and a joint bid from Paramount Classics and foreign sales company Summit Entertainment.
“I know for a fact that the movie was sold for north of $10 million,” said Tony Safford, senior VP acquisitions, 20th Century Fox. “But I believe Miramax must feel that such a high acquisition cost does not ultimately benefit the perception of the movie.”
Miramax L.A. president Mark Gill was quick to respond to Safford’s remarks. “As the entire industry knows, Tony is a disgruntled ex-Miramax employee with an ax to grind. I was in the room for the full 12 hours of negotiations, and not once did I see or hear Tony Safford. Clearly the man has a tremendous gift for imagination and spite.”
A $10 million-plus purchase would beat the previous Sundance record of $10 million, which Castle Rock Entertainment paid for “The Spitfire Grill” in 1996. That pic went on to gross a disappointing $12.6 million in the U.S.
While the “Happy” deal does not specify an exact P&A commitment, Miramax has apparently told the producers the film will get at least a 50-city release, with significant TV advertising support.
The agreement also calls for a guaranteed October release date. That unusual move was probably intended to assure the filmmakers that “Happy” would not meet the same fate as “The Castle,” which Miramax purchased in a big hullabaloo at last year’s Sundance fest but has yet to release.
“Happy” is expected to get an aggressive platform release, starting in New York and L.A. exclusives and expanding into a national run. The $2.5 million advance that Miramax paid covers the film’s $1.7 million budget plus $800,000 in production deferments.
Following Monday’s 5 p.m. press screening, the filmmakers and their William Morris Agency reps met individually with each of the interested parties. While all of the other bidders had dropped out shortly after midnight, the deal didn’t close until about 6:30 Tuesday morning.
$8 mil offer
At one point, Miramax is said to have offered a minimum guarantee of as much as $8 million, an offer that was topped by another bidder. It was at that point the minimajor changed tack and proposed the more backloaded arrangement the filmmakers finally accepted.
By accepting the Miramax offer, the moviemakers walked away from a huge guaranteed profit. On the other hand, their deal will turn out to be extremely lucrative if the picture grosses more than $20 million, as Miramax hopes it will.
“We created a back-end structure to the deal so that if the movie succeeds in theaters, the filmmakers will do very well,” said Miramax senior VP Jason Blum.
“We had two higher bids for our movie but decided to go with the premiere distributor, Miramax,” Illsley said. “I can’t tell you how thrilled I am to pick Miramax because they are the best, not because they had the biggest pocketbook.”
“Happy,” which was shot in 26 days, was financed by contributions from Illsley’s family and friends. Illsley wrote the screenplay with Ed Stone and Phil Reeves, and produced it with Rick Montgomery and Stone. Jason Clark exec produced.
Blum, senior VP Amy Israel, Gill, and senior VP of business affairs Andrew Herwitz negotiated for Miramax.