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WELLINGTON THEATER 573
the amount which he would pay for the picture on a flat rental basis. He also tried to set the split figure as near as possible to the normal gross of the theater when playing a flat rental picture which had cost approximately the amount of the guaranty.2
The bulk of silent pictures were sold on a flat rental basis. Some theaters exhibited special productions and roadshows on a percentage arrangement, but these were usually confined to higher quality pictures which were expected to realize box office receipts that were in excess of the average gross.
The manager of the Wellington Theater was opposed to percentage bookings of all kinds. He never made such contracts except for roadshow productions which he could not buy on a flat rental basis. His aversion to the percentage arrangement was based on several grounds. Such contracts stipulated a definite length of run. If, during this run, a certain gross was realized, many percentage arrangements compelled the exhibitor to hold the picture for an extended run. A schedule of percentage sharings for such contingencies was worked out in advance and placed in the original contract. A lasting disadvantage operated against the exhibitor in that all agreements and price arrangements were used against him on future contracts. Even if percentage bookings did not realize the expected gross, a price revision downward on subsequent bookings was difficult to negotiate. Percentage bookings also forced the exhibitor to reveal figures which were considered to be confidential. This was particularly true in setting the split figure, since house expenses and an allowance for profit were supposed to accrue to the theater before sharing commenced. Exhibitors did not wish to reveal house expense and total gross figures, since these allowed producers to estimate the net profits of each theater. These same producers operated their own theaters and might use such information as a basis for establishing competing houses where excellent profits were indicated.
The allowance for profit was always a matter of disagreement. The manager of the Wellington Theater believed the allowance should equal the guaranty. One distributor stated that 25% of the guaranty was sufficient, while another allowed 50%. Because of this wide divergence of opinion, exhibitors often padded their
2 See Sidley Pictures Corporation, page 325.