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CAIC (Cash Accumulation Insurance Contracts) Available through Geneva Media Holdings, LLC

CAIC (Cash Accumulation Insurance Contracts) Available through Geneva Media Holdings, LLC. T H E C A S E S T U D Y. In simple terms, how does CAIC work ? Cast and crews are bonused a salary The salaries “double” state film tax credits A “restriction” is placed on each salary bonus

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CAIC (Cash Accumulation Insurance Contracts) Available through Geneva Media Holdings, LLC

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  1. CAIC (Cash Accumulation Insurance Contracts) Available through Geneva Media Holdings, LLC

  2. T H E CA S E S T U D Y In simple terms, how does CAIC work? Cast and crews are bonused a salary The salaries “double” state film tax credits A “restriction” is placed on each salary bonus Restrictions are removed at “break even” This provides loan collateral and liquidity CAIC also insures a cast and crew’s families (from disability and death)

  3. $150M LP CAIC $300M FACE AMOUNTS $75M CASH VALUES $150M Slate Studio spend: LP spend: Retain F.A. + $ 300,000,000 (FAMILIES PROTECTED W/ $300M IN BENEFITS) $75,000,000 $75,000,000 Negative Cost Negative Cost Hit films? C.V. $ 150,000,000 (FAMILIES AND FUND RUNNERS RETAIN $150M) T H E CA S E S T U D Y If the film facility breaks even, the fund keeps $150,000,000! Srvs.Credit = $ 18,750,000 Picture Sub. = $ 18,750,000 Labr.Credit = $ 18,750,000 C.T.C. = $ 15,000,000 F.R. = $ 13,750,000 C.V. = $ 75,000,000 All Collateral= $ 150,000,000 $75,000,000 $75,000,000 Insurance Cost Negative Cost 100% break-even for bank or equity facility 25%Profits 75% Profits M.G.A. = $15M to $ 30,000,000

  4. T H E CA S E S T U D Y 100% SAFETY regardless of box office or ancillary sales!

  5. The Funder $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ The Funder $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ The Crew ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ The Crew ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ $ $ $ Single Picture LLC Single Picture LLC Single Picture LLC Single Picture LLC TAX FREE CASH TO FAMILY TAX NEUTRAL CASH TO FUNDER Media Mitigation Holdings, LLP Collateral Protection T H E CA S E S T U D Y Who owns the CAIC --so it qualifies as deductible? The Funding Entity: Pension Funds, V.C.s Hedge Funds,Banks, Private Equity,but NOTafilmstudio!

  6. Policyowner Bank / Funder Crew exchanges a partial Collateral Assignment of the Cash Accumulations for a L.Partners’ interest Film LP CAIC 1% G.P. Owner Major Bank $ 98% L.Partners 1+1%G.P. Media Mitigation Holdings, LLP 1% G.P. Owner $ A+ Insurer T H E CA S E S T U D Y Who owns the CAIC --so it qualifies for perfection? The Funder $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ The Crew ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ ♀♂ G.P.s control the Collateral Assignment and all Cash Accumulation

  7. $ $ $ 35%-65% Tax Credits! Hedge Fund $ Film LP $ Labor &Serv Costs Studio / Network CAIC $$$$ $$$ $$$ $$ $$ Slate Fund Major Bank Families C a s t and Crew A+ Insurer T H E T O O L 50% SAFETY! 50% Insurance Premium Costs

  8. T H E T O O L 25% to 35% tax incentives for financial service costs (including L&H and P&C insurance premiums and banking fees) from all qualified lenders or carriers that are commercially domiciled in over 20 states (GA, LA, IL, FL, NM, PA, CT, CA) Productions in a number of U.S. states (and Canadian provinces) also offer: 25% to 65% qualified production labor credits; and an additional 2% to 12% additional labor incentives, or for filming in areas of economic impoverishment

  9. T H E T O O L What does the structure achieve? Protects media investors from loss Helps increase capital at major studios Provides true, film/TV slate, risk mitigation Creates millions in new media spending Provides loan collateral and liquidity Protects the film’s cast and crew

  10. T H E T O O L

  11. T H E T O O L What is the legal basis of the CAIC structure? IRS tax code 264(a)(1) – L&H cost deductions Simple employee insurance benefit (162 Bonus) Restrictive Executive Benefit Agreement (REBA) 50 years of proven COLI, BOLI and NQDC contracts IRS tax code 181 and 199 film tax deductions US and Canadian theatrical film tax credits

  12. T H E T O O L US Source: Tax Foundation.org, Movie Production Incentives

  13. T H E T O O L US U.S.FILM TAX INCENTIVE AMOUNTS ARE STILL GROWING: $2B+IN2013. Source: Tax Foundation.org, Movie Production Incentives

  14. T H E T O O L Source: Weiss Research, American and Canadian L&H Company ratings, May 2012

  15. T H E T O O L CALIFORNIA

  16. T H E T O O L ILLINOIS

  17. T H E T O O L GEORGIA

  18. T H E T O O L LOUISIANA

  19. T H E T O O L PUERTO RICO

  20. T H E T O O L FLORIDA

  21. T H E T O O L TEXAS

  22. T H E T O O L NEW MEXICO

  23. T H E T O O L PENNSYLVANIA

  24. T H E T O O L CONNECTICUT

  25. T H E I N D U S T R Y LE A D E R S • Geneva Media Holdings LLC: (a risk mitigation consulting firm established in California in 1989, and incorporated in 1994) 9171 Wilshire Blvd #670, Beverly Hills, CA (424) 666-8769 • We support accounting, financial, legal and tax advisors • Offices; Beverly Hills, CA. Lake Forest, IL (100+ partners) • We are top underwriters and experienced in working with: • Media verticals (e.g., Tribune Media… etc., since 1978) • Bell-Phillip TV (e.g., Y & R… CBS… etc., since 1989) • Other key client work (e.g., Kohl’s… Pritzker’s… etc.) • Advanced financial, tax, estate and NQDC planning • Administration for COLI, BOLI, CAIC and key-man

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