If buying a piece of an Internet company didn’t have small-fry investors living enough on the edge, a company that lets them finance an independent film is nearing its long-awaited initial public stock offering.
The IPO prospectus for Billy Dead Inc. is already online at www.civilian.com. Project is the first from the production company Civilian Pictures and its subsid, brokerage Civilian Capital, announced late in the Internet boom at the 2000 Sundance Film Festival.
Civilian was created to provide another way to get small films made. Because the prospectus is undergoing standard SEC review, Civilian execs are in the offering’s “quiet period” and legally can say little.
But the prospectus itself speaks volumes for the titanic risks involved in making an indie pic, and even more about investing in one.
“We have no way of financing our continued operations unless this offering is successful, and are therefore considered to be in unsound financial condition,” the prospectus announces in its first paragraph. “Investing in our Series A preferred stock involves a high degree of risk. You should purchase shares only if you can afford a complete loss.”
To begin with, Billy Dead Inc. would issue 900,000 shares at $8.75 apiece, raising about $7.9 million. If it doesn’t sell all the shares, the project is, well, dead.
If the stock does sell, Civilian Capital gets $549,000 in underwriting commissions, leaving $7.3 million to make the movie, pay off startup costs and cover other expenses.
After the IPO, preferred stockholders would have about a third of voting shares in Billy Dead Inc. (Civilian execs and board members control the rest.) Billy Dead’s sole purpose is to make a feature of that name, based on Lisa Reardon’s 1998 murder mystery.
Keith Gordon (“Waking the Dead,” “The Singing Detective”) would direct and has written the screenplay, which is excerpted in the prospectus, complete with storyboard images.
Ethan Hawke is skedded to star and would exec produce with Erwin Stoff (“The Matrix”), while Julie Lynn (“Seabiscuit”) would produce.
After the film has been sold, Billy Dead Inc. would be dissolved and assets split. The preferred stockholders get their original $8.75 per share back first, and split the rest 80-20 with the common shareholders. But that second distribution would happen only after the movie’s makers with contingency deals receive 37.5% of the remaining sale proceeds.
Civilian Pictures CEO Barry Poltermann said the company has had a long, slow grind to get to its current position.
“Looking back, our timing couldn’t have been worse. We started at the beginning of the tech wreck,” Poltermann said. “Our intention was to offer something later that year (in 2000). But after everything happened, we kind of stopped and decided to take things a step at a time.”