2000 AD Online Forum

2000 AD => News => : Wake 11 October, 2002, 05:27:18 PM

: 2000AD Films PLC
: Wake 11 October, 2002, 05:27:18 PM
The 2000AD Films share prospectus is now available to download. The current file is about 1 Mb, but a higher resolution 6 Mb file may be available later today.

No can someone with a legal mind work out whether the proposed group application can still work.

I guess tax is only a concern if the shares ever actually make a profit.

Wake

Link: 2000AD Films plc

: Re: 2000AD Films PLC
: Pagangirl 11 October, 2002, 05:30:41 PM
****I guess tax is only a concern if the shares ever actually make a profit. ***

Is that a teeny bit of pessemism I detect?
: Re: 2000AD Films PLC
: Oddboy 11 October, 2002, 06:01:21 PM
Looks like it'll be fun.
Make sure whoever fills it in for us ticks the D'yer Wanna Be An Extra? box.

Will we all be allowed to go to the premiere? on is it one ticket per application?

Then again, if we all went to the premiere then who'd be paying see it?  Better we pay our ticket money & then the film flops...
: Re: 2000AD Films PLC
: sigu 11 October, 2002, 07:34:31 PM
nice logo.

Do you know where we can write off for a proper paper version?

SiG
: Re: 2000AD Films PLC
: Oddboy 11 October, 2002, 07:41:15 PM
Website Download: http://www.2000adfilms.com

Email Request: df@2000adfilms.com

Postal Request: 2000AD Films Plc
Pinewood Studios
Pinewood Road
Iver Heath
Buckinghamshire SL0 0NH
United Kingdom


Phone request: 01753 657104
: Re: 2000AD Films PLC
: Buddy 11 October, 2002, 08:50:02 PM
As much as I'd love for this to happen, the chances of anything actually gettin' made is remote at best.

I remember seeing production sketches for the Stronty Dog (TV?) movie years ago. That bit the dust when it was discovered that some money would actually have to be spent to make it.

Same thing's gonna happen here, great ideas, no dosh.

Here endeth the rant

Link: http://www.ximoc.co.uk

: Re: 2000AD Films PLC
: critter 12 October, 2002, 08:09:16 PM
"you are a resident of the United Kingdom or acting on behalf of a resident of the United Kingdom; and"

Does this mean I can't participate because I Live in the US?

Will
: Re: 2000AD Films PLC
: roystead 12 October, 2002, 08:47:47 PM
OK, I'm officially not interested in this venture.

For reasons, look at clause 3.2 of the prospectus, which essentially seems to say "we just want your money, we'll decide what to do with it and we'll keep most of the profit for ourselves".

Details: There are two types of share - A and B. There are 200 "A" shares, retained by the company directors, and 6,000,000 "B" shares, which are the ones being sold.

Each of the 6,000,200 shares costs the same amount. Only "A" shares can vote on what the company does. If there's any profit (or any income from the shares at all) then it gets split in half, with half given to "A" shareholders and the other half to "B" shareholders.

Example - say the movie is made and it makes a profit of ?1,000,000. Each "A" shareholder receives ?2,500 per share out of that profit, while each "B" shareholder receives 8p per share out of that profit.

If there's a loss, the loss does not appear to be divided in quite the same way (see 3.2.4(ii)), with the liquidator having the discretion to share liability for any debts incurred by the company between all shareholders, "A" and "B".

Not content with this bet-hedging, the directors also seem to have allowed for their own share options (clause 3.2.7 - holders of "A" shares can obtain a shedload of "B" shares for free, thus diluting the value of other "B" shares, if anyone ever decides to buy or float the company). There's also a clause that the film won't be made if the company hasn't raised ?250,000 by November 19th.

It's not clear to me what right, if any, "B" shareholders would have to a (partial or full) refund at that point, or what liability they might have for any debts incurred in the interim.

I'm not a lawyer or an accountant, so it's possible that my analysis is completely wrong here. I am used to reading and negotiating business contracts, though. And personally I wouldn't touch this one with a stick of any size - it looks to me like the "B" shareholders (you and me) pay all the money and take all the risks while the "A" shareholders (the company directors) retain all the control, offset their risks and make the vast bulk of any profit.
: Re: 2000AD Films PLC
: GordonR 12 October, 2002, 10:26:54 PM
>>Does this mean I can't participate because I Live in the US?

That would be my understanding, yes.

These Enterprise Investment things are partly intended as tax shelters, or at least sources of tax relief.  UK residents who invest in them can then possibly claim some money off their income tax payments, the government's idea being, I suppose to encourage people to invest in UK-based enterprises.

The prospectus does mention the tax relief part, hecen why the scheme is only open to UK tax payers.
: Re: 2000AD Films PLC
: DavidXBrunt 13 October, 2002, 12:18:32 AM
But if you want to buy some send me ?2000 and I'll invest it for you. Wisely.
: Re: 2000AD Films PLC
: Something Fishy 13 October, 2002, 02:34:48 AM
I'd still like to put me money in because i like the idea and i suppose i must be stupid.
: Re: 2000AD Films PLC
: Andy Diggle 13 October, 2002, 09:54:11 PM
Interesting. Thanks for the legal walkthrough, roystead.

So if 2000AD Films plc fails to raise the requisite ?250,000 by November 19, what happens to all the money they *have* raised?

And even if they do raise the requisite amount, are they under any obligation to actually spend it trying to make a film?
: Re: 2000AD Films PLC
: roystead 13 October, 2002, 11:50:06 PM
"So if 2000AD Films plc fails to raise the requisite ?250,000 by November 19, what happens to all the money they *have* raised?"

That's not clear to me, from the prospectus. It looks like they deduct expenses, keep half of it to share amongst "A" shareholders and return the other half to "B" shareholders. BUt I can't be sure.

"And even if they do raise the requisite amount, are they under any obligation to actually spend it trying to make a film?"

An interesting question - again, it's not clear to me from this prospectus.
: Re: 2000AD Films PLC
: Jim_Campbell 14 October, 2002, 05:40:48 PM
++"So if 2000AD Films plc fails to raise the requisite ?250,000 by November 19, what happens to all the money they *have* raised?"



That's not clear to me, from the prospectus. It looks like they deduct expenses, keep half of it to share amongst "A" shareholders and return the other half to "B" shareholders. BUt I can't be sure. ++



Erm ...



From Page 25 of the Prospectus:



"If the Minimum Subscription is not received within 40 days of the issue of this prospectus, the Film will not proceed and applicants will be refunded their subscription money in full."



Which is not to say that I think it's a good deal - quite the reverse, in fact, since I agree completely with Roystead other than on this point.



I would also like to draw attention to the following (Article 3.2.2. p19):



"No holder of B Shares shall have the right to receive notice of, attend, speak or vote at any general meeting of the Company."



At which point, my interest in this project officially fell to 'zero'. If I'm expected to be part of the group putting up the vast majority of the capital, then I damn well expect to have some voting rights.



Cheers



Jim
: Re: 2000AD Films PLC
: Tex Hex 14 October, 2002, 05:58:08 PM
Ive not read it, but I gather its more like 2000ad Films Charity? If I dont get to walk about on set with a cigar then what's the point?
: Re: 2000AD Films PLC
: Andy Diggle 14 October, 2002, 08:13:06 PM
I've just been assured that your interpretation of the prospectus is way off target, roystead.



If Rebellion don't raise the requisite amount by November 19th, they apparently return all the money, and also pay any expenses themselves.



If they do raise the requisite amount, they're legally obliged to spend it making films - so they can't just spend it on, say, a quarter of a million quid's worth of gobstoppers.



So that's all right then!



Unless you're a gobstopper wholesaler, in which case it's probably a bit gutting.



Link: andydiggle.com

: Re: 2000AD Films PLC
: gifle 14 October, 2002, 08:19:41 PM
If you had actually thought about reading the prospectus properly before sharing your wisdom with the world then maybe someone might take what you say as actually being of an informed nature and not just worthless tattle. As a potential investor, I have had my financial advisor look over the document in question. I note that the A shares owned by the directors who have to operate the company and make it a success are virtually valueless unless the owners of the B shares (investors) turn a profit, at which point directors are entitled to participate in the excess of the profits therein after. This to me seems a perfectly reasonable incentive for said directors to do evrything in their power to make this venture a success, otherwise what is the point of the whole excercise.
Furthermore, if the minimum amount required to operate the company has not been raised in a pre-determined time, then the offer will not proceed and all investment will be returned to you and I with no costs deducted.
You should note that this is a very common way for business in the UK to raise capital for funding business and offers very attractive tax breaks for its investors, which I have participated in before.

I will certainly be giving this venture a punt as an avid fan of 2000 AD since inception.
: Re: 2000AD Films PLC
: Jim_Campbell 14 October, 2002, 08:39:52 PM
++I've just been assured that your interpretation of the prospectus is way off target, roystead. ++



I agree that it's not a take-the-money-and-run deal, but I do have to say that it still _really_ doesn't look like a good deal [1], based on Roystead's other points, and sundry other little clauses in the prospectus, ie:



1) The B shareholders (that's you and me, BTW) put up all the money and only get half the profits.



2) The B shareholders can,at a liquidator's discretion, be made equally liable for the company's debts, despite only ever being in line for half the profits.



3) The A shareholders can be awarded unspecified bonuses in the form of B shares, meaning that, in addition to automatically being in line for half the profits anyway, the A shareholders can help themselves to a portion of the B shareholder's half.



4) The B shareholders have no voting rights, no right to attend AGMs and will not be told when and where AGMs will be held. This means that if (purely hypothetically) the B shareholders were of the opinion that the directors (also, not coincidentally, the A shareholders) were pissing their investment up the wall, they would have no means of expressing their displeasure to the board, short of private litigation or mass letter-writing campaigns.



Now, perhaps the tax breaks might be attractive to invesment companies and institutions, but a private investor contemplating raiding their savings might want to look elsewhere for additions to their investment portfolio.



No, no ... me and my barge pole will be steering well clear, thankyouverymuch ...



Cheers



Jim



[1] Please qualify all the following with the usual "I am not a lawyer"-type disclaimers ...
: Re: 2000AD Films PLC
: Oddboy 14 October, 2002, 10:00:06 PM
If they do raise the requisite amount, they're legally obliged to spend it making films - so they can't just spend it on, say, a quarter of a million quid's worth of gobstoppers.

Depends... they might be making the sequal to "Mind the Oranges, Marlon" which involves a million gobstoppers.
: Re: 2000AD Films PLC
: Matt 14 October, 2002, 10:06:36 PM
Can't remember the gobstoppers, thought it was oranges.
: Re: 2000AD Films PLC
: Oddboy 14 October, 2002, 10:58:23 PM
THAT's why I said it would be a sequal...

I'll get me coat (and take it to a comedy club which has a higher level of audience who will appreciate my humour)


?-p
: Re: 2000AD Films PLC
: Trout 14 October, 2002, 11:23:45 PM
Let's make a prequel!

Li'l DR and Junior Quinch!

Rogue Stem Cell

Dredd: The Early Years (perhaps not)

- Trout
: Re: 2000AD Films PLC
: Trout 15 October, 2002, 03:57:17 AM
I really think we need some proper advice here. Is there a lawyer in the house?

I have a (Scots) law degree but this really isn't my speciality. NB I am not a practising lawyer.

One possibility might be to draw up a basic partnership agreement or simply register a small company with Companies House, or whatever it's called in England and Wales.

We would provide investment capital for the company

(which, if it's set up like a charity, with shares limited by guarantee, might be able to avoid quite a lot of tax by itself)

and the company buys the shares.

Obviously, this creates admin, legal, accountancy costs, which would add to the financial burden, to a relatively small extent, that we as directors or members of the company would bear, but I reckon it's the simplest way of doing it.

Please don't be frightened of I'm getting a little technical; it's very simple, in Scotland at least, to set up a basic partnership.

That said, I'd prefer it if someone else took this on. I often feel like I'm on a million committees and right now I'm trying to scale down my involvement in various things.

Is the idea of buying into this thing unravelling as rapidly as it seems to be?

- Trout