Net Profit Participants are those who...

• A. Those who have a contractual right to be paid a percentage of the film's net profits
• B. Those who negotiate a percentage of gross receipts
• C. Lenders
• D. Back-end

Answer: (A)

Net profit participants are people who have a contractual right to receive a percentage of the film’s net profits — the profits remaining after deductions such as distribution fees, overhead, and other specified offsets are subtracted. This is different from a share of gross receipts, which would be paid from total box office without accounting for those deductions. Lenders are typically repaid their loan and interest and do not become net profit participants unless the contract explicitly provides for profit sharing. Back-end is a broad term for profit-based compensation, but net profit participation is defined specifically by the right to net profits, making it the precise description of who qualifies.