Deposit Structures That Survive a Cancelled Shoot

A deposit and a kill fee clause get written into the same contract, on the same day, by people who rarely sit down and check whether the two numbers actually agree with each other. Kill fees and cancellation clauses laid out the industry-standard notice-window tiers: 30 or more days before pre-production runs 10 to 25% of contract value, 7 to 14 days during active pre-production runs 25 to 50%, inside 72 hours the floor is 50% of the shoot day's budget, and day-of cancellation is 100% of that day's budget. That post also made the point that matters here: the deposit is the first kill fee. It is not a separate pot of money sitting next to the cancellation schedule. It is a down payment against whatever that schedule eventually says is owed.

What that post did not do is walk the actual dollars. If a client cancels with 10 days notice on a $50,000 project running a 30/40/30 schedule, does the deposit already collected cover the fee, or does an invoice still need to go out? The honest answer depends on exactly where in the payment schedule the project sits when the cancellation lands, and most contracts never spell that out. This is that math, for each of GLM's three standard deposit structures against the published cancellation tiers.

The timeline assumption, stated plainly

Every scenario below assumes the same thing: each payment in a milestone schedule is collected only when its milestone is actually reached. The signing or kickoff payment lands at contract signing, which happens before the 30-day pre-production window even opens. Every later payment, whether it is billed against shoot completion, an offline edit, or final delivery, is not collected until that later event actually occurs. A cancelled shoot, by definition, never reaches shoot completion. So on any structure with a milestone tied to the shoot or to what follows it, that payment simply never arrives, no matter which cancellation tier applies. This is the assumption that decides most of the math below, and it is worth building into the contract language itself rather than leaving it to interpretation after a shoot falls through.

Each example below also assumes a shoot day budget, stated as a dollar figure, since the 72-hour and day-of tiers key off that number specifically rather than total contract value. A contract that never states what the shoot day's budget actually is leaves both sides guessing exactly when it matters most.

50/50, an $18,000 project

Signing: $9,000. Delivery: $9,000. Assume the shoot day carries roughly $10,000 of the total, consistent with a single-day project under $25,000 where the shoot itself is most of the cost. Because delivery never happens on a cancelled project, the $9,000 signing payment is the only money collected at every tier below.

• 30+ days notice. Kill fee at 15% of $18,000 is $2,700. The $9,000 already collected covers it with $6,300 to spare. The deposit is non-refundable, so GLM keeps the full $9,000 and owes nothing back.
• 7-14 days notice. Kill fee at 35% of $18,000, a mid-range point inside the published 25 to 50% tier (each example below picks its own point in that range; the interactive shows the full span), is $6,300. Still covered, with $2,700 left over. Same result: keep the deposit, no invoice, no refund.
• Inside 72 hours. The floor is 50% of the $10,000 shoot day budget, or $5,000. The $9,000 collected still covers it, with $4,000 to spare.
• Day-of cancellation. The fee is 100% of the shoot day budget, the full $10,000. The $9,000 collected falls $1,000 short. This is the one tier on a 50/50 structure where an additional invoice goes out.

The 50/50 structure comfortably absorbs everything except the worst case. That is the shape it is built for: a small project where the deposit is large relative to total contract value, and only the day the client actually cancels on-site pushes past what was already in hand.

30/40/30, a $50,000 project

Signing: $15,000. Shoot completion: $20,000. Delivery: $15,000. Assume the shoot day budget approximates the shoot-completion tranche, $20,000, since that milestone is sized to cover the production phase. Only the $15,000 signing payment is collected at every tier, since shoot completion never triggers on a cancelled shoot.

• 30+ days notice. Kill fee at 15% of $50,000 is $7,500. Covered, with $7,500 to spare.
• 7-14 days notice. Kill fee at 30% of $50,000 is exactly $15,000, an exact match against the deposit collected. GLM keeps the deposit, the client owes nothing further, and no refund is due.
• Inside 72 hours. The floor is 50% of the $20,000 shoot day budget, or $10,000. Covered, with $5,000 to spare.
• Day-of cancellation. The fee is 100% of the $20,000 shoot day budget. The $15,000 collected falls $5,000 short. An additional invoice for $5,000 goes out.

The 30/40/30 structure holds through the first three tiers the same way 50/50 does, then opens the largest gap of the three structured examples on day-of cancellation, because the tranche meant to cover the shoot itself, 40% of the total, is precisely the payment that never lands when the shoot doesn't happen.

33/33/33, a $120,000 project

Kickoff: $40,000. Offline edit: $40,000. Final handoff: $40,000. Assume roughly $50,000 of the total is tied to the shoot days themselves, a smaller share of total contract value than on the smaller structures above, consistent with a multi-day production where pre-production and finishing carry proportionally more of the budget. Only the $40,000 kickoff payment is collected at every tier, since the offline edit milestone follows the shoot and never triggers on a cancelled project.

• 30+ days notice. Kill fee at 15% of $120,000 is $18,000. Covered, with $22,000 to spare.
• 7-14 days notice. Kill fee at 40% of $120,000 is $48,000. The $40,000 collected falls $8,000 short. An additional invoice for $8,000 goes out here, earlier in the schedule than either of the smaller structures required one.
• Inside 72 hours. The floor is 50% of the $50,000 shoot day budget, or $25,000. Covered, with $15,000 to spare.
• Day-of cancellation. The fee is 100% of the $50,000 shoot day budget. The $40,000 collected falls $10,000 short. An additional invoice for $10,000 goes out.

Larger projects on this structure carry more absolute risk of a mid-schedule shortfall, because the kickoff payment is only a third of a much larger total, and the 25 to 50% range on the 7-14 day tier can land above that third even before the shoot day tiers come into play. The lesson for anyone quoting a 33/33/33 project: get specific about where in that range the contract actually sits, rather than leaving a 25-point spread to be argued about after a cancellation notice arrives.

The 100% upfront option is a different animal

GLM reserves the 100% upfront option for short-turnaround work and new clients with no payment history. On a $15,000 quick-turn project with a $9,000 shoot day budget, the same figures used in the kill fees post's own worked example, the full $15,000 sits in the account before anything ships. That changes the question entirely. The company is never short. It is always sitting on a surplus, and the only question is how much of that surplus is actually justified by the kill fee schedule.

• 30+ days notice. Kill fee at 15% is $2,250. Refunding $12,750 and keeping $2,250 is the honest number.
• 7-14 days notice. Kill fee at 25% is $3,750. Refund $11,250, keep $3,750.
• Inside 72 hours. The floor is 50% of the $9,000 shoot day budget, $4,500. Refund $10,500, keep $4,500.
• Day-of cancellation. The fee is 100% of the $9,000 shoot day budget. Refund $6,000, keep $9,000.

Contract language usually says a deposit is non-refundable, and on a structured milestone deposit that language does real work, it is what lets a company keep a surplus at the earlier tiers without an argument. But 100% upfront is not a deposit in the same sense. It is the full contract value collected in advance for reasons that have nothing to do with the cancellation schedule, usually cash flow risk on a new client or a compressed production timeline. Treating a 30-day-notice cancellation on that structure as an excuse to keep the entire $15,000, when the actual kill fee owed is $2,250, is what most non-refundable-deposit language is written to allow and commercially indefensible in almost every other sense. It reads to the client as opportunism, not risk management, and it burns a relationship over a few thousand dollars the company was never entitled to on the merits. The correct default is refunding the gap. What the contract permits and what a production company should actually do with a client who cancelled in good faith are not the same question.

Where AICP's stricter tiers fit

The tiers used above track the calendar-day framing most direct-to-brand contracts run on. AICP's published production guidelines use a stricter, more granular standard built on working days rather than calendar days: cancellation 1 to 10 working days before a shoot makes the client liable for all out-of-pocket costs plus the full director's fee and full production fee as bid, and cancellation 11 to 15 working days out makes the client liable for those same costs plus not less than 50% of the director's and production fees. That standard runs noticeably heavier than the 7-14 day and 72-hour tiers used in the examples above, and it is the standard larger union commercial jobs typically anchor to. A production company negotiating a national or agency-driven job should expect the buyer's legal team to reference AICP language directly, even if the company's own standard contract runs the lighter version.

Writing this into the contract

The gap between what a deposit covers and what a kill fee schedule demands is not a flaw in either document. It is a predictable consequence of two clauses written independently, and it closes with one sentence added to the payment schedule: state explicitly that deposits collected to date apply toward, but do not automatically satisfy, any kill fee owed under the cancellation schedule, and that any shortfall is billed as a separate invoice due on cancellation. Pair that with a stated shoot day budget figure, not a vague percentage, and both sides know the exact number before a cancellation ever happens, instead of working it out under pressure after one does.

The same discipline applies on the other side of a project's lifecycle. How to prevent scope creep before it starts covers what happens when a project grows past what was quoted; this post covers what happens when it stops before it finishes. Both problems trace back to the same root cause: a contract that states a number without stating the situation it applies to. And if a client ever pushes back on why the deposit and kill fee schedule exist at all, what you are actually paying for is the plain answer: crew holds, gear reservations, and prep labor that get spent whether or not the shoot happens.

This is general information about how deposit and cancellation clauses commonly interact in commercial production contracts, not legal advice for a specific agreement. Have actual contract language reviewed by an attorney licensed in the relevant jurisdiction before it goes into a signed agreement.