THE FUNKTION STUDIO

Terms of Service

1. Nature of Agreement

These terms and conditions are included in the client agreement with the service provider (“The Funktion Studio”). These terms and conditions apply to all productions undertaken for the client by The Funktion Studio. The client is deemed to have accepted these terms and conditions if chosen to proceed in dealings with The Funktion Studio after receiving notice of these terms and conditions. Unless expressly agreed to the contrary in writing, the Producer will be deemed to have delivered the product if a complete and reasonably acceptable master is made available.

2. Payment

(a) In consideration for the service provider’s services under this agreement, the client agrees to pay the service provider the agreed quote in accordance with the payment terms as outlined under clause 3.

(b) The service provider agrees that it will perform the responsibilities and produce the materials in accordance with best practice industry standards.

3. Payment terms

(a) For any job quoted at $5,000 or less, a 100% upfront payment of the agreed or estimated production cost (plus GST) must be paid to the service provider no later than five working days before the first date scheduled for commencement of work.

(b) For any job quoted at over $5,000 a 50% upfront payment of the agreed or estimated production cost (plus GST) must be paid to the service provider no later than five working days before the first date scheduled for commencement of work.

A second payment of 50% (plus GST) will be invoiced on delivery of the final master and is payable within 30 days.

(c) This contract is on a fixed cost basis. The service provider is entitled to adjust and reallocate the costs which make up the agreed or estimated total. This means that a failure by the service provider to incur a particular cost does not prevent the service provider from allowing for that cost when charging the agreed or estimated total.

(d) In addition to the service fees, the service provider is entitled to be reimbursed for expenses reasonably incurred in carrying out its obligations under this agreement provided that the company has obtained the client's approval of the expense prior to incurring it (except in the case of genuine urgency).

(e) In addition to the service provider’s other rights in relation to late payment, the service provider is entitled to charge interest on any overdue amounts at a rate equal to the prevailing Reserve Bank of Australia official cash rate as at the due date for payment plus 2% per annum, with interest to be calculated daily.

4. Cancellation and postponement by the client

(a) If the client cancels or postpones production of the project in circumstances where The Funktion Studio has committed no material breach of the agreement, the client must in all cases reimburse The Funktion Studio for all direct costs and the total creative fee plus the proportions of the Production Fee as provided in clause 4(d) below.

(b) Pay The Funktion Studio a 100% cancellation fee for all salaries, equipment, sub-contractor's fees, and 100% of all out-of-pocket costs to date for a production cancelled or postponed within 48 hours of scheduled shooting due to circumstances above and beyond the control of The Funktion Studio.

(c) If the production involves post production, and you cancel after post production has commenced, you must pay for all production and post production costs incurred to that point.

(d) For the avoidance of doubt, the proportion of the Production Fee payable under this clause depends on the notice period and the type of production but is always additional to the direct costs so that where:

i. the client gives The Funktion Studio 15 or more business days’ notice of cancellation or postponement of a production, the Company must pay 25% of the Production Fee;

ii. the client gives The Funktion Studio less than 15 but more than 10 business days’ notice of cancellation or postponement of a production the Company must pay 50% of the Production Fee;

iii. the client gives The Funktion Studio 10 or less business days’ notice of cancellation or postponement of a production the Company must pay 100% of the Production Fee;

For the purposes of this clause, ‘business day’ means any day Monday to Friday, excluding public holidays.

e) Notwithstanding the above, in all cases of postponement of a production the client will use its best endeavors to limit the time period of any such postponement and upon the postponement ceasing, the parties will negotiate new terms and fees for the production taking into account the length of postponement, any payments made under this clause, and the financial impact of the postponement on the parties.

5. Contingency & Weather Days & Force Majeure:

(a) The client agrees that if a production is suspended, frustrated or delayed by bad weather conditions, a contingency beyond the control of the production company, or by some other force majeure event which would include, but are not limited to, storms, tempests, earthquakes, wars, floods, injury, illness or non-appearance of key talent, delay or failure of delivery of goods or services to be supplied by the client, whether on-camera product, vehicles or otherwise it must, in such circumstances, and in addition to all other agreed or stipulated payments, pay the company the costs and fees specified by Producer in advance or supplied to the company on request.

6. Client Obligations

6.1 The Client represents and warrants that nothing required to be done by The Funktion Studio at the direction of the Client in connection with this Agreement will:

(a) infringe the Intellectual Property Rights of any person;

(b) defame or breach the privacy of any person;

(d) cause the Service Provider to be liable for any breach of Federal, State or Territory legislation including in relation to the communication of electronic messages, protection of personal information.

6.2 The Client represents and warrants that:

(a) upon receipt of Master approval files (Approval Files) from the service provider it will review and check those files to satisfy itself that those approval files are correct and in accordance with the services ordered;

(b) the review and checking of the approval files will be conducted by the client prior to the Client sending its written approval to the services provider, upon receipt of which the service provider will arrange for uploading of master files; and

(c) it accepts the responsibility for ensuring that content of the approval files is in accordance with the relevant client’s requirements.

6.3 The Client represents and warrants that it has made appropriate copies of all client material and the service provider will not, at any time, hold the only copy of an original file.

7. Safekeeping of Negative/Videotape/Digital Assets

(a) The Funktion Studio shall be responsible for the safekeeping of any negative, videotape, digital assets during production of the project and during their laboratory processing and at all other times up to the point at which the Masters are delivered to the Client.

(b) The Funktion Studio shall not be responsible for the security of the Materials or any other items in any other circumstances.

(c) The Funktion Studio shall not be responsible for insuring the negative, videotape/digital assets and any other Materials after the final Delivery Date or the Completion Date (whichever date occurs first).

(d) The Client acknowledges and agrees that The Funktion Studio may, at its absolute discretion, archive Client Material (or copies of Client Material) for a limited period after the Engagement has ended.

8. Amendment Requests

If the client (including where such request occurs for or on behalf of any third party) asks for the production schedule, Budget or scope of work to be altered:

a) the parties will use their best endeavours to agree new dates and relevant deliverables, and the client will be responsible for any reasonable and unavoidable increases in the Agreed Quote or costs arising as a result;

b) any amounts shall be paid in full by the client in accordance with the Payment Dates detailed under this Agreement.

9. Intellectual property rights

(a) Ownership of the Materials and all related property produced under this Agreement shall remain vested in The Funktion Studio until it has received payment of the entire Agreed Quote.

(b) Upon receipt by The Funktion Studio of the total Agreed Quote and any extra charges incurred as a result of an agreed revision to the Responsibilities, The Funktion Studio shall assign to the client all of its copyright in the Materials and the films for use as agreed in Annexure One.

(c) Where The Funktion Studio expressly commissions any material from a third party for use in the content/s or uses any existing material which has been created by The Funktion Studio or such third party for the content/s, The Funktion Studio undertakes to obtain either an assignment to the Client of such copyright as may exist in such materials The Funktion Studio or, if an assignment is not feasible, or cannot be negotiated on reasonable terms, a licence on terms to be approved by the Company, and at the cost of the Client, to use the materials in the content/s.

(d) The Funktion Studio undertakes, wherever possible and practicable, to procure and pass on to the client moral rights consents or waivers in a form to be approved by the Client, from the director and all other persons materially engaged in the creation or production of the content/s or any part thereof by The Funktion Studio.

(e) The client and The Funktion Studio will ensure, wherever possible and practicable, that appropriate permissions are obtained in respect of any copyright or trademarked material supplied by the client or The Funktion Studio, as the case may be, for inclusion in the content/s. The party supplying such material being responsible for its clearance.

(f) Where The Funktion Studio agrees to be responsible for the engagement of actors, other performers or models, The Funktion Studio undertakes to obtain where possible, all necessary consents from such parties on terms to be approved by the Client.

10 Confidential Information

10.1 The parties acknowledge a duty to not during or after the termination or completion of this Agreement to disclose without the other’s prior written permission any confidential information either concerning the other’s business, or that of the advertiser, its business plans, customers or associated companies or any other relevant information about the Commercial/s disclosed as a result of this Agreement.

10.2 In particular during and after the production The Funktion Studio acknowledges its responsibility to treat in confidence all the marketing and sales information and statistics relating to the advertiser’s business.

10.3 Both parties shall impose obligations in terms equivalent to those above on its own personnel. For purposes of clarification all information involved in the production of the Materials is of a confidential nature and may only be discussed outside of the production/standard production procedures with the express written permission of the client Authorised Representative.

11 Governing Law

This Agreement shall be governed by the laws of the State of New South Wales, Australia and the parties hereby submit to the non-exclusive jurisdiction of the Courts.