Steve Spielberg finalized his exit form Paramount Pictures and signed a $1.2 billion deal with Reliance Big Entertainment of India to help finance his projects from now on.

As part of this move, the famous film director took with him the DreamWorks brand, an entertainment company which he co founded with David Geffen. DreamWorks was purchased by Paramount for $1.6 billion in a deal that was completed in early 2006.

Spielberg has secured at least $500 million in funding from the Indian company and another $500 million or more from a JPMorgan Securities-led bank loan syndication. The total sum will help DreamWorks become a private company.

The agreement with Mumbai-based Reliance, Paramount and other parties implicated was reached Thursday night. Only the terms of the deal were reached and agreed upon with a handshake. The paperwork will follow.

One of the surprises of the agreement was that Paramount said in a statement that it allows the departing DreamWorks principals to take their employees with them. The DreamWorks brass had exit clauses stipulated in their contracts, but to take other executives or staff with them they needed approval.

"To facilitate a timely and smooth transition, Paramount has waived certain provisions from the original deal to clear the way for the DreamWorks principals and their employees to join their new company without delay," the studio said.

Spielberg will still be entitled to 7.5% of the box-office earnings and 50% of the profits generated by certain future DreamWorks projects released by Paramount. Paramount is not obliged to accept the making of DreamWorks-proposed films if their financial perspective isn’t good enough. Nevertheless, most people in the industry believe DreamWorks will soon sign a deal with Universal.

Spielberg, Geffen and DreamWorks chief executive officer Stacey Snider are all expected to tender their resignations from Paramount.

"We congratulate Steven, David and Stacey, and wish them well as they start their newest venture,” Paramount said in the statement.