As filed with the Commission on January 28, 2008 Commission File No. 333-148076
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Pre-Effective Amendment No. 1 to
FORM SB-2/A
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GIDDY-UP PRODUCTIONS, INC.
(Name of small business issuer in its charter)
NEVADA 7812 26-0853182
(State of Jurisdiction) (Primary Standard Industrial Classification Code
Number) (I.R.S. Employer Identification No.)
409 - 903 19TH AVENUE SW
CALGARY, AB T2T 0H8
(403) 399-6402
(Address and telephone number of principal executive offices)
LAUGHLIN INTERNATIONAL
2533 CARSON STREET
CARSON CITY, NEVADA 89706
775-883-8484
(Name, address and telephone number of agent for service)
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after
the effective date of this registration statement.
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, please check the following box: [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
================================================================================
Title of Each
Class of Number of Aggregate
Securities to Shares to Offering Price Offering Registration
be Registered be Registered per Share (1) Price Fee (2)
Common Stock 2,000,000 $0.10 $200,000 $6.14
--------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(o) under the Securities Act and based upon 2,000,000
shares of common stock to be sold in this offering.
(2) Fee already paid.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A)
MAY DETERMINE.
PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION
DATED JANUARY 28, 2008
GIDDY-UP PRODUCTIONS, INC.
2,000,000 SHARES OF COMMON STOCK
PRICE: $0.10 PER SHARE
This is an initial public offering of shares of common stock of Giddy-up
Productions Inc. We will be selling a maximum of 2,000,000 shares at $0.10 per
share on a best efforts basis. The offering price for our common stock was
arbitrarily determined and may not reflect the market price of our shares after
the offering.
There is no minimum number of shares to be sold in order for us to accept funds.
No escrow account will be used. This offering will expire 12 months from the
effective date. We may terminate this offering prior to the expiration date.
No broker-dealer is participating in this offering and no sales commission will
be paid to any person in connection with this offering. The shares will be
offered and sold by our officers and directors who will not receive any
commission. There is no market for our securities. Our common stock is not
listed on any national exchange or the NASDAQ Stock Market.
AN INVESTMENT IN OUR STOCK IS EXTREMELY SPECULATIVE AND INVOLVES SEVERAL
SIGNIFICANT RISKS. PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO INVEST UNLESS
THEY CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT. WE URGE ALL PROSPECTIVE
INVESTORS TO READ THE "RISK FACTORS" SECTION OF THIS PROSPECTUS BEGINNING ON
PAGE 5 AND THE REST OF THIS PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION.
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of any offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state.
--------------------------------------------------------------------------------
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS GIDDY-UP PRODUCTIONS(1)
--------------------------------------------------------------------------------
Per Share $ 0.10 $ 0 $ 0.10
Maximum 2,000,000 shares $200,000 $ 0 $ 200,000
================================================================================
(1) Proceeds to Giddy-up Productions, Inc. are shown before deducting
offering expenses payable by us estimated be $40,000, including legal fees.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is January 28, 2008.
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TABLE OF CONTENTS
Page
Summary 3
Risk Factors 5
Forward-Looking Statements 8
Use of Proceeds 9
Determination of Offering Price 9
Dilution 10
Market for Common Equity and Related Stockholder Matters 10
Description of Business 10
Description of Property 16
Plan of Operation 16
Legal Proceedings 19
Directors, Executive Officers, Promoters and Control Persons 19
Executive Compensation 20
Certain Relationships and Related Transactions 20
Security Ownership of Certain Beneficial Owners and Management 21
Plan of Distribution 21
Description of Securities 23
Disclosure of Commission Position on Indemnification for Securities Act
Liabilities 24
Legal Matters 24
Experts 24
Changes in and Disagreements With Accountants On Accounting and Financial
Disclosure 24
Available Information 25
Index To Financial Statements F-1
2
SUMMARY
THE FOLLOWING SUMMARY IS NOT COMPLETE AND DOES NOT CONTAIN ALL OF THE
INFORMATION THAT MAY BE IMPORTANT TO PROSPECTIVE INVESTORS. EACH PROSPECTIVE
INVESTOR IS URGED TO READ THIS PROSPECTUS IN ITS ENTIRETY BEFORE MAKING AN
INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK.
As used in this prospectus, unless the context otherwise requires, "we", "us",
"our" or "Giddy-up" refers to Giddy-up Productions, Inc., "SEC" refers to the
Securities Exchange Commission, "Securities Act" refers to the Securities Act
of 1933, as amended, and "Exchange Act" refers to the Securities Exchange Act of
1934, as amended.
GIDDY-UP PRODUCTIONS INC.
We were incorporated on August 30, 2007, under the laws of the State of Nevada.
We are a development stage independent motion picture producer having our
principal office located at 409-903 19th Avenue SW, Calgary, AB. Our telephone
number is (403) 399-6402. Our facsimile number is (866) 900-0582. Our website
is presently being developed and will be located on the Internet at
www.starflick.com. It is expected to be fully operational by January 31, 2008.
We are in the business of developing, producing, marketing and distributing
low-budget feature-length films. We have not commenced business operations. To
date, our business activities have been limited to organizational matters,
acquiring film rights, developing our website and the preparation and filing of
the registration statement of which this prospectus is a part.
Our ability to achieve and maintain profitability and positive cash flow is
dependent upon our ability to produce commercially successful motion picture
films. We presently own all rights to a low-budget, feature-length motion
picture that we acquired from our President for $40,000. We do not have rights
to any other film, screenplay or other literary work.
Upon completing this offering, we intend to develop up to six screenplays that
can be produced into commercially successful motion pictures having production
budgets not exceeding $5 million. Such development will include the purchase of
exclusive options to acquire existing screenplays and the commissioning of an
additional screenplay. We plan to complete this development by March 1, 2009.
To date, we have not secured any options to acquire screenplays or entered into
any agreement to commission a screenplay.
The number of screenplays to which we will be able to secure production rights
during the development stage will depend upon the success of this offering.
Regardless of the number of shares we sell in this offering, we intend to
commission a screenplay based on a submission to our website. If we sell 50% of
our offering we expect to purchase two options on existing screenplays plus the
commissioned screenplay. If we are successful in selling 75% of this offering,
we plan to purchase options to acquire five screenplays in addition to the
commissioned screenplay.
We do not have sufficient capital to independently finance our own productions
and we do not intend to produce a film from the proceeds of this offering. We
do not presently have any arrangements in place for any future financing. If we
are unable to secure additional financing we may be unable to produce any
feature films, in which case, we may cease or suspend operations. We have no
plans, arrangements or contingencies in place in the event that we cease
operations.
Our management has minimal experience in the production of motion pictures.
Their lack of experience could hinder their ability to successfully identify and
develop screenplays that will result in commercially successful films, or to
secure production financing. It is likely that our management's inexperience
with film production and financing will hinder our ability to earn revenue.
We currently have no employees other than our officer and directors. We do not
intend to hire any employees for the next 12 months.
We are controlled by our President. Even if we are able to sell all of the
offered shares, he will own 80% of our voting stock.
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We have no operating history on which to base an evaluation of our business and
prospects. Prospective purchasers of our stock should be aware of the
difficulties normally encountered by new film production companies and the high
rate of failure of such enterprises. These risks include without limitation the
high probability that we will be unable to produce a commercially successful
film. If we are unable to profit from the production of motion pictures, our
business will most likely fail.
THE OFFERING
Securities Offered: Up to 2,000,000 shares of common stock, par value $0.0001
Offering price: $0.10 per share
Offering period: The shares are being offered for a period of 12 months
Net proceeds to us: Approximately $160,000 after expenses of
approximately $40,000 assuming sale of 2,000,000 shares
Use of proceeds: We will use the proceeds to pay for offering expenses,
debt repayment, film options, motion picture development
and pre-production, equipment, website development,
marketing expenses, professional fees and working capital
Number of shares 8,000,000
outstanding before
the offering:
Maximum Number of 10,000,000 assuming sale of all 2,000,000
shares outstanding shares being offered.
after the offering:
SUMMARY OF SELECTED FINANCIAL DATA
We are a development stage company. From the date of our inception on August
30, 2007, to November 30, 2007, we have not generated any revenue or earnings
from operations. As of November 30, 2007, our financial data is as follows:
---------------------------------------------------------------------
As at or for the period
from August 30, 2007
(inception) to
November 30, 2007
---------------------------------------------------------------------
OPERATIONS DATA
Revenue: $ 0
General and administrative expenses: $ 26,191
Loss for the period: $ 26,191
Loss per share: $ 0.00
---------------------------------------------------------------------
BALANCE SHEET DATA
Total assets: $ 27,585
Total liabilities: $ 42,463
Common stock $ 810
Accumulated (deficit): $ (26,191)
Shareholder's equity (deficiency): $ 14,878
Total liabilities and shareholders'
equity (deficiency): $ 27,585
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RISK FACTORS
ANY INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. PROSPECTIVE
INVESTORS SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW AND THE OTHER
INFORMATION IN THIS PROSPECTUS BEFORE INVESTING IN OUR COMMON STOCK. IF ANY OF
THE FOLLOWING RISKS OCCUR, OUR BUSINESS, OPERATING RESULTS AND FINANCIAL
CONDITION COULD BE SERIOUSLY HARMED. INVESTORS MAY LOSE ALL OR PART OF THEIR
INVESTMENT IN THIS OFFERING.
(1) WE ARE A DEVELOPMENT STAGE COMPANY WITH NO OPERATING HISTORY, SO IT WILL
BE DIFFICULT FOR POTENTIAL INVESTORS TO JUDGE OUR PROSPECTS FOR SUCCESS.
We are a newly organized development stage corporation and have no operating
history from which to evaluate our business and prospects. We have earned no
revenue since inception. From inception through November 30, 2007, we incurred a
net loss of $(26,191) and an accumulated negative tangible book value of
$(26,191). There can be no assurance that our future proposed operations will
be implemented successfully or that we will ever have profits. If we are unable
to sustain our operations, investors may lose their entire investment.
Prospective purchasers of our stock should be aware of the difficulties normally
encountered by new film production companies and the high rate of failure of
such enterprises. These risks include without limitation the high probability
that our development activities will deplete our available capital and not
result in a commercially successful film. Unless we are able to produce a
profitable motion picture, our business will most likely fail. These
difficulties must be considered when evaluating our business and prospects.
(2) IF WE ARE UNABLE TO CONTINUE OPERATIONS AS A GOING CONCERN, OUR
SHAREHOLDERS MAY LOSE THEIR INVESTMENT.
The report of our independent auditors that accompanies our November 30, 2007
financial statements contains an explanatory paragraph expressing substantial
doubt about our ability to continue as a going concern. The financial
statements have been prepared "assuming that the Company will continue as a
going concern," which contemplates that we will realize our assets and satisfy
our liabilities and commitments in the ordinary course of business. Our ability
to continue as a going concern is dependent upon raising additional capital to
fund our operations and ultimately on generating future profitable operations.
There can be no assurance that we will be able to raise sufficient additional
capital or eventually have positive cash flow from operations to address all of
our cash flow needs. If we are not able to find alternative sources of cash or
generate positive cash flow then we will not be able to continue operations and
our shareholders may lose their investment.
(3) WE ARE DEPENDENT UPON THIS OFFERING TO BE ABLE TO IMPLEMENT OUR BUSINESS
PLAN AND OUR LACK OF REVENUE AND PROFITS MAY MAKE OBTAINING ADDITIONAL CAPITAL
MORE DIFFICULT.
We presently have no significant operating capital and we are completely
dependent upon the proceeds of this offering to provide the capital necessary to
commence our proposed business. Upon completion of this offering, the amount of
capital available to us will still be extremely limited, especially if less than
the total amount of the offering is raised. We have a commitment from our
President to provide additional cash funding to complete development of our
website, commission a screenplay and market Not That Kind Of Girl, presently our
only film property. We do not have any other commitments for additional cash
funding beyond the proceeds to be received from this offering. To the extent
that we are unable to sell all of the offered shares, our ability to implement
our business plan and develop screenplays for production into motion pictures
will be adversely affected. If we are unable to produce a commercially
successful motion picture, our shareholders may lose their investment.
(4) IF WE ARE UNABLE TO SECURE ADDITIONAL FINANCING WE MAY BE UNABLE TO EARN
REVENUE.
We intend to make motion pictures with production budgets of $5 million or less.
We believe the proceeds from this offering will satisfy our capital requirements
for the next 12 months, but they will not be sufficient for the production of a
motion picture. We will need to raise all the money required to fund the
production of a motion picture from outside sources. Such financing could take
the form of co-production or joint venture arrangements or limited liability
companies or partnerships in which we act as managing member or general partner,
additional sales of our securities or an operating line of credit. No assurance
can be given that additional financing will be available to us, or that if
available, it will be available on favorable terms. Unless we are able to
obtain such additional financing, our production activities may be materially
adversely affected and our shareholders may lose their entire investment. We
currently have no financing commitments.
(5) IF WE ARE UNABLE TO DEVELOP COMMERCIALLY VIABLE SCREENPLAYS, OUR
BUSINESS MAY FAIL.
Our success will depend upon our ability to develop screenplays that can be
produced into commercially viable films. We intend to rely upon our President's
access to and relationships with, creative talent, including writers, actors and
directors to find screenplays. We also intend to rely upon our website to
identify a story or concept that can be developed into screenplays. Our
5
President has no experience with identifying commercially viable screenplays,
and there can be no assurance that we will be able to acquire such a screenplay.
Furthermore, our website has no operating history and there can be no assurance
that the website will receive any submissions, or that if it does receive
submissions, that the story or concept of the submission can be developed into a
screenplay suitable for production into a motion picture. If we are unable to
develop commercially viable screenplays, then our business will fail and our
shareholders may lose their entire investment.
(6) IF OUR FILMS ARE NOT COMMERCIALLY SUCCESSFUL, OUR BUSINESS MAY FAIL.
Producing feature length films involves substantial risks, because it requires
that we spend significant funds based entirely on our preliminary evaluation of
the screenplay's commercial potential as a film. It is impossible to predict
the success of any film before the production starts. The ability of a motion
picture to generate revenues will depend upon a variety of unpredictable
factors, including:
public taste, which is always subject to change;
the quantity and popularity of other films and leisure activities available
to the public at the time of our release;
the competition for exhibition at movie theatres, through video retailers,
on cable television and through other forms of distribution; and
the fact that not all films are distributed in all media.
For any of these reasons, the films that we produce may not be commercially
successful and our business may suffer or fail altogether.
(7) IF WE ARE UNABLE TO SECURE DISTRIBUTION FOR OUR FILMS, OUR BUSINESS WILL
SUFFER.
Because we lack the resources to distribute our films ourselves, we plan to
enter into arrangements with established distributors. As a result, we may be
unable to secure distribution agreements or revenue guarantees before funds are
spent on production. In addition, if we are unable to obtain theatrical
distribution on acceptable terms, we may evaluate other alternatives, such as
retaining a distributor as an independent contractor or bypassing theatrical
distribution altogether. If we retain a distributor as an independent
contractor we may be required to seek additional financing to cover this cost,
which we anticipate will be $50,000 to $100,000 per film. If we bypass
theatrical distribution and attempt to release our films directly to pay cable
or home video, we will probably not generate enough revenues to become
profitable. If we are unable to obtain adequate distribution, we may not have
the ability to generate revenue.
(8) OUR OFFICERS AND DIRECTORS HAVE LIMITED EXPERIENCE IN THE MOTION PICTURE
INDUSTRY, WHICH COULD PREVENT US FROM SUCCESSFULLY IMPLEMENTING OUR BUSINESS
PLAN, AND IMPEDE OUR ABILITY TO EARN REVENUE.
Our officers and directors have limited experience in the motion picture
industry. Zoltan Nagy, our President and a director, has only produced one film,
which was not commercially exploited. Marnie Kuhn, a director, co-produced the
same film, but otherwise has no experience with film production. Our
management's lack of experience could hinder their ability to successfully
develop screenplays that will result in commercially successful films, or to
secure production financing. It is likely that our management's inexperience
with film production and financing will hinder our ability to earn revenue.
Each potential investor must carefully consider the lack of experience of our
officers and directors before purchasing our common stock.
(9) SINCE SUBSTANTIALLY ALL OF OUR ASSETS, DIRECTORS AND OFFICERS ARE NOT
LOCATED IN THE UNITED STATES, IT MAY BE DIFFICULT FOR INVESTORS TO ENFORCE
WITHIN THE UNITED STATES ANY JUDGMENTS OBTAINED AGAINST US OR ANY OF OUR
DIRECTORS OR OFFICERS.
Substantially all of our assets are located outside the United States and we do
not currently maintain a permanent place of business within the United States.
We were incorporated in the State of Nevada and have an agent for service in
Carson City, Nevada. Our agent for service will accept on our behalf the
service of any legal process and any demand or notice authorized by law to be
served upon a corporation. Our agent for service will not, however, accept
service on behalf of any of our officers or directors. All of our directors and
officers are residents of Canada and neither of them have an agent for service
in the United States. Therefore, it may be difficult for shareholders to
enforce within the United States any judgments obtained against us or our
officers or directors, including judgments predicated upon the civil liability
provisions of the securities laws of the United States or any state thereof.
6
(10) SINCE OUR BOARD OF DIRECTORS DOES NOT INTEND TO PAY DIVIDENDS ON OUR
COMMON STOCK IN THE FORESEEABLE FUTURE, IT IS LIKELY THAT INVESTORS WILL ONLY BE
ABLE TO REALIZE A RETURN ON THEIR INVESTMENT BY RESELLING ANY SHARES PURCHASED
THROUGH THIS OFFERING.
We have not paid any cash dividends on our common stock since our inception and
we do not anticipate paying cash dividends in the foreseeable future. We intend
to retain our earnings, if any, to provide funds for reinvestment in our
acquisition and exploration activities. Therefore, we do not anticipate
declaring or paying dividends in the foreseeable future. Furthermore, payment
of dividends, if any, in the future is within the discretion of the Board of
Directors and will depend on our earnings, if any, our capital requirements and
financial condition and other relevant factors.
(11) EVEN IF ALL THE OFFERED SHARES ARE SOLD, OUR OFFICERS AND DIRECTORS
WILL OWN A CONTROLLING PERCENTAGE OF VOTING STOCK, WHICH WILL ALLOW THEM TO MAKE
KEY DECISIONS AND EFFECT TRANSACTIONS WITHOUT FURTHER SHAREHOLDER APPROVAL.
If all the offered shares are sold, our directors and executive officers will
collectively own 80% of our outstanding voting stock. Accordingly, these
stockholders, as a group, will be able to control the outcome of stockholder
votes, including votes concerning the election of directors, the adoption or
amendment of provisions in our Articles of Incorporation and our Bylaws, and the
approval of mergers and other significant corporate transactions. These factors
may also have the effect of delaying or preventing a change in our management or
our voting control. Our Articles of Incorporation do not provide for cumulative
voting.
(12) WE MAY ISSUE SHARES OF PREFERRED STOCK WITH GREATER RIGHTS THAN OUR
COMMON STOCK, WHICH MAY ENTRENCH MANAGEMENT AND RESULT IN DILUTION OF OUR
SHAREHOLDERS' INVESTMENT.
Our Articles of Incorporation authorize the issuance of up to 100,000,000 shares
of preferred stock, par value $.0001 per share. The authorized but unissued
preferred stock may be issued by the Board of Directors from time to time on any
number of occasions, without stockholder approval, as one or more separate
series of shares comprised of any number of the authorized but unissued shares
of preferred stock, designated by resolution of the Board of Directors stating
the name and number of shares of each series and setting forth separately for
such series the relative rights, privileges and preferences thereof, including,
if any, the: (i) rate of dividends payable thereon; (ii) price, terms and
conditions of redemption; (iii) voluntary and involuntary liquidation
preferences; (iv) provisions of a sinking fund for redemption or repurchase; (v)
terms of conversion to common stock, including conversion price, and (vi) voting
rights. Such preferred stock may enable our Board of Directors to hinder or
discourage any attempt to gain control of us by a merger, tender offer at a
control premium price, proxy contest or otherwise. Consequently, the preferred
stock could entrench our management. The market price of our common stock could
be depressed to some extent by the existence of the preferred stock. As of the
date of this prospectus, no shares of preferred stock have been issued.
(13) INVESTORS WILL NOT RECEIVE ANY OF THEIR INVESTMENT BACK REGARDLESS OF
HOW MANY SHARES WE SELL.
We have not established an escrow account and there is no minimum number of
shares that are to be sold in this offering. We will not return investors'
funds, regardless of the number of shares that we sell. Furthermore, we will
have immediate access to funds raised in this offering. Therefore, no one
should invest in our business unless they are in a position to lose their entire
investment.
(14) INVESTORS MAY SUFFER SUBSTANTIAL DILUTION OF THEIR INVESTMENT IF WE
RAISE ADDITIONAL FINANCING BY ISSUING ADDITIONAL SHARES OF OUR COMMON STOCK.
We do not intend to finance the production of a motion picture through the
issuance of shares or convertible securities. Notwithstanding, if we are
required to raise additional financing to fund operations through the issuance
of our common stock or debt instruments that are convertible into common stock,
the percentage ownership of our investors may be subject to dilution. Dilution
is the difference between what our investors paid for their stock and the net
tangible book value per share immediately after the additional shares are sold
by us. If this happens, then our shareholders could experience a substantial
decline in the value of their investment.
(15) SINCE THERE IS NO PUBLIC TRADING MARKET FOR OUR COMMON STOCK, INVESTORS
MAY NOT BE ABLE TO RESELL ANY SHARES THEY PURCHASE THROUGH THIS OFFERING.
Currently, our common stock is not listed or quoted upon any established trading
system. Most of our common stock will be held by a small number of investors
that will further reduce the liquidity of our common stock. Furthermore, the
offering price of our common stock was arbitrarily determined by us, without
considering assets, earnings, book value, net worth or other economic or
recognized criteria or future value of our common stock. Market fluctuations
7
and volatility, as well as general economic, market and political conditions,
could reduce our market price. Consequently, it may difficult or impossible for
shareholders to sell our common stock or for them to sell our common stock for
more than the offering price even if our operating results are positive.
(16) IN THE FUTURE, WE WILL INCUR SIGNIFICANT COSTS AS A RESULT OF OPERATING
AS A PUBLIC COMPANY, AND OUR MANAGEMENT WILL BE REQUIRED TO DEVOTE SUBSTANTIAL
TIME TO NEW COMPLIANCE INITIATIVES.
Upon the effectiveness of the registration statement of which this prospectus
forms a part, we will incur significant legal, accounting and other expenses as
a fully-reporting public company. Moreover, the Sarbanes-Oxley Act of 2002 (the
"Sarbanes-Oxley Act"), as well as new rules subsequently implemented by the SEC,
have imposed various new requirements on public companies, including requiring
changes in corporate governance practices. Our management will need to devote a
substantial amount of time to these new compliance initiatives. Moreover, these
rules and regulations will increase our legal and financial compliance costs and
will make some activities more time-consuming and costly.
The Sarbanes-Oxley Act also requires, among other things, that we maintain
effective internal controls for financial reporting and disclosure controls and
procedures. In particular, commencing in fiscal 2008, we must perform system
and process evaluation and testing of our internal controls over financial
reporting to allow management and our independent registered public accounting
firm to report on the effectiveness of our internal controls over financial
reporting, as required by Section 404 of the Sarbanes-Oxley Act. Our testing,
or the subsequent testing by our independent registered public accounting firm,
may reveal deficiencies in our internal controls over financial reporting that
are deemed to be material weaknesses. Our compliance with Section 404 will
require that we incur substantial accounting expense and expend significant
management efforts. Moreover, if we are not able to comply with the
requirements of Section 404 in a timely manner, or if we or our independent
registered public accounting firm identifies deficiencies in our internal
controls over financial reporting that are deemed to be material weaknesses, the
market price of our stock could decline, and we could be subject to sanctions or
investigations by the SEC or other regulatory authorities, which would require
additional financial and management resources.
FORWARD-LOOKING STATEMENTS
INFORMATION IN THIS PROSPECTUS CONTAINS "FORWARD LOOKING STATEMENTS" WHICH CAN
BE IDENTIFIED BY THE USE OF FORWARD-LOOKING WORDS SUCH AS "BELIEVES",
"ESTIMATES", "COULD", "POSSIBLY", "PROBABLY", "ANTICIPATES", "ESTIMATES",
"PROJECTS", "EXPECTS", "MAY", OR "SHOULD" OR OTHER VARIATIONS OR SIMILAR WORDS.
NO ASSURANCE CAN BE GIVEN THAT THE FUTURE RESULTS ANTICIPATED BY THE
FORWARD-LOOKING STATEMENTS WILL BE ACHIEVED. THESE STATEMENTS CONSTITUTE
CAUTIONARY STATEMENTS IDENTIFYING IMPORTANT FACTORS WITH RESPECT TO THOSE
FORWARD-LOOKING STATEMENTS, INCLUDING CERTAIN RISKS AND UNCERTAINTIES THAT COULD
CAUSE ACTUAL RESULTS TO VARY MATERIALLY FROM THE FUTURE RESULTS ANTICIPATED BY
THOSE FORWARD-LOOKING STATEMENTS. SUCH STATEMENTS ARE ONLY PREDICTIONS AND
INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS, INCLUDING THE
RISKS IN THE SECTION TITLED "RISK FACTORS". AMONG THE KEY FACTORS THAT HAVE A
DIRECT BEARING ON OUR RESULTS OF OPERATIONS ARE THE EFFECTS OF VARIOUS
GOVERNMENTAL REGULATIONS, THE FLUCTUATION OF OUR DIRECT COSTS AND THE COSTS AND
EFFECTIVENESS OF OUR OPERATING STRATEGY. OTHER FACTORS COULD ALSO CAUSE ACTUAL
RESULTS TO VARY MATERIALLY FROM THE FUTURE RESULTS ANTICIPATED BY THOSE
FORWARD-LOOKING STATEMENTS.
THE FORWARD-LOOKING STATEMENTS ARE BASED UPON MANAGEMENT'S CURRENT VIEWS AND
ASSUMPTIONS REGARDING FUTURE EVENTS AND OPERATING PERFORMANCE, AND ARE
APPLICABLE ONLY AS OF THE DATES OF SUCH STATEMENTS. WE DO NOT HAVE ANY
INTENTION OR OBLIGATION TO UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS,
WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS, CHANGES IN ASSUMPTIONS,
OR OTHERWISE.
8
USE OF PROCEEDS
We are offering a maximum of 2,000,000 shares of our common stock on a best
efforts, self-underwritten basis. The table below sets forth management's
current estimate of the allocation of net proceeds anticipated to received from
this offering if 100%, 75%, 50% and 25% of the offering is sold.
--------------------------------------------------------------------------------
100% 75% 50% 25%
2,000,000 1,500,000 1,000,000 500,000
Shares Shares Shares Shares
--------------------------------------------------------------------------------
Gross Proceeds $ 200,000 $ 150,000 $ 100,000 $ 50,000
Less offering Expenses 40,000 40,000 40,000 40,000
--------------------------------------------------------------------------------
Net Proceeds $ 160,000 $ 110,000 $ 60,000 $ 10,000
Use of Proceeds
Debt Repayment $ 10,000 $ 10,000 $ 10,000 $ -
Options to Acquire Film Rights 25,000 25,000 10,000 -
Commissioned Screenplay 10,000 10,000 10,000 -
Motion Picture Pre-production Costs 12,000 12,000 5,000 -
Digital Camera 8,000 8,000 8,000 -
Website 43,000 8,000 7,000 5,000
Marketing Expenses 20,000 20,000 5,000 -
Professional Fees 12,000 12,000 - -
Office Lease 10,000 - - -
Working Capital 10,000 5,000 5,000 5,000
--------------------------------------------------------------------------------
Total Use of Proceeds $ 160,000 $ 110,000 $ 60,000 $ 10,000
================================================================================
Debt Repayment refers to repayment of a loan in the amount of $10,000 from our
President on November 12, 2007, evidenced by a promissory note issued to him on
the same date. Under the terms of the promissory note, which is unsecured, we
promised to repay our President the sum of $10,000 plus accrued interest at the
annual rate of 5% and is due and payable on demand. As of the date of this
prospectus, no payment has been made in respect of the promissory note.
Proceeds of the loan were used to pay for startup costs, accounting fees, and
miscellaneous expenses.
Options to Acquire Literary Properties refers to the cost of purchasing the
exclusive rights for a negotiated period of time to acquire screenplays that can
be produced into a commercially salable motion pictures. During the term of an
option, the owner of the screenplay cannot sell it to any other party. Upon
expiration of an option, we will forfeit the right to purchase the screenplay at
the negotiated price.
Motion Picture Pre-production Costs include legal fees, screenplay revisions and
consulting fees resulting from the creation of business plans, budgets and
shooting schedules.
Marketing Expenses include website development and maintenance costs, film
representation, travel and entertainment expenses.
We will be paying a total of $30,000 out of the proceeds of this offering to our
President, to reimburse him for $20,000 in offering expenses incurred on our
behalf and to repay the loan of $10,000 secured by promissory note. None of the
remaining proceeds from this offering will be paid to insiders of Giddy-up.
If we do not raise sufficient capital to pay for offering expenses, our
President will advance sufficient funds on our behalf to pay the difference.
DETERMINATION OF OFFERING PRICE
There is no established public market for the shares of common stock being
registered. As a result, the offering price and other terms and conditions
relative to the shares of common stock offered hereby have been arbitrarily
determined by us and do not necessarily bear any relationship to assets,
earnings, book value or any other objective criteria of value. In addition, no
investment banker, appraiser or other independent, third party has been
consulted concerning the offering price for the shares or the fairness of the
price used for the shares.
9
DILUTION
As at November 30, 2007, we had a negative book value of $(25,691) or $(0.00)
per share. Negative book value per share is determined by dividing our total
shareholders' deficit at November 30, 2007, by the number of shares of common
stock outstanding. Without taking into account any changes in negative book
value after November 30, 2007, other than to give effect to the sale of the
2,000,000 shares of common stock offered hereby, and after deducting estimated
offering expenses, the pro forma book value at November 30, 2007, would have
been approximately $134,309 or $0.01 per share. This amount represents an
immediate dilution to new investors of $0.09 per share. The following table
illustrates this dilution:
Assumed public offering price per share $ 0.10
Negative Book value per share at November 30, 2007 $(0.00)
Increase per share attributable to new investors 0.01
Book value per share after offering 0.01
Book value dilution per share to new investors $ 0.09
Assuming the sale of 75%, 50% and 25% of the offered shares, the pro forma book
value at November 30, 2007, would have been approximately $84,309 or $0.01 per
share, $34,309 or $0.01 per share, and negative book value of $15,691 or $0.00
per share, representing a book value dilution per share to new investors of
$0.09, $0.09 and $0.10 per share respectively.
The following table summarizes, as of the date of this prospectus, the
difference between existing shareholders and new investors in this offering with
respect to the number of shares held or purchased from us, the total
consideration paid and the average consideration paid per share, assuming all
common shares offered hereby are sold:
--------------------------------------------------------------------------------
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
NUMBER % AMOUNT % PRICE PER SHARE
--------------------------------------------------------------------------------
Existing shareholders 8,100,000 80 $ 40,500 17 $ 0.005
New investors 2,000,000 20 $200,000 83 $ 0.10
Total 10,100,000 100 $240,500 100 $ 0.02
================================================================================
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
NO PUBLIC MARKET FOR COMMON STOCK
There is presently no public market for our shares. We anticipate making an
application for quotation of our common stock on the NASD OTC bulletin board
upon the effectiveness of the registration statement of which this prospectus
forms a part. We will not be able to obtain a quotation of our securities on
the OTC Bulletin Board without a sponsoring market maker and we have not made
any such arrangement. If we are unable to find a sponsoring market maker then a
trading market for our common stock will not develop. Even if we are able to
locate a market maker, there is no assurance that our common stock will be
accepted for quotation on the OTC Bulletin Board, or if quoted, that a public
market will materialize.
Securities quoted on the OTC Bulletin Board are not listed or traded on the
floor of an organized national or regional stock exchange. Instead, OTC Bulletin
Board securities transactions are conducted through a telephone and computer
network connecting dealers in stocks. OTC Bulletin Board stocks are
traditionally smaller companies that do not meet the financial and other listing
requirements of a regional or national stock exchange.
HOLDERS
There are presently two shareholders of record of our common stock.
DESCRIPTION OF BUSINESS
GENERAL
We were incorporated on August 30, 2007, under the laws of the State of Nevada.
We are a development stage independent motion picture producer having our
principal office located at 409-903 19th Avenue SW, Calgary, AB. Our telephone
number is (403) 399-6402. Our facsimile number is (866) 900-0582. Our website
is presently being developed and will be located on the Internet at
www.starflick.com. It is expected to be fully operational by January 31, 2008.
10
We are in the business of developing, producing, marketing and distributing
low-budget feature-length films. We have not commenced business operations. To
date, our business activities have been limited to organizational matters,
acquiring film rights, developing our website and the preparation and filing of
the registration statement of which this prospectus is a part.
We presently own all right, title and interest in and to a feature length motion
picture entitled "Not That Kind of Girl," that was produced by our President and
acquired from him for $40,000 (see Certain Relationships and Related
Transactions). Not That Kind of Girl was produced in 2003, stars Kathleen
Collins, and was directed by Zoltan Nagy. It is the story of a tragic romance
between Zack, a radio disc jockey, and Jessica, an aspiring singer, and centers
on Zack's attempts to rescue Jessica from her self-destructive choices.
We intend to fully exploit all rights in Not That Kind Of Girl and each film
that we produce, including theatrical and non-theatrical distribution in all
markets and media throughout the world. Where applicable, we also intend to
pursue the publishing and promotion of associated music, the incorporation of
original songs on sound tracks for subsequent use in promotion, sound track
albums, story-telling records and the licensing of merchandising rights.
We currently have no employees. We may utilize independent contractors and
consultants from time to time to assist in developing, producing and promoting
our motion pictures. Independent contractors are generally paid on a commission,
hourly or job-related basis, depending on the services being performed.
We have no plans, arrangements, commitments, or understandings to engage in a
merger or acquisition with another company.
OUR BUSINESS
We are committed to the development and production of commercially salable
feature-length motion pictures having budgets of up to $5 million, but which
have enduring value in all media. We anticipate not only acquiring rights and
producing motion pictures but also capitalizing on other marketing opportunities
associated with these properties.
We do not have sufficient capital to independently finance our own productions.
We intend to rely on outside sources of financing for all film production
activities. We plan to use most of our available capital to finance film
development by acquiring options to existing screenplays and commissioning new
screenplays, pre-production and marketing.
Our ability to achieve and maintain profitability and positive cash flow is
dependent upon our ability to produce commercially successful motion picture
films. In order to succeed, we must develop or acquire screenplays appropriate
for production and distribution. We intend to rely on our President's access to
and relationships with, creative talent, including writers, actors and directors
to find suitable existing screenplays. We also intend to rely upon our website
to identify a story or concept that can be developed into a new screenplay.
Our website is being developed and is expected to be fully operational by
January 31, 2008. The purpose of our website is to encourage the submission of
short films (less than 11 minutes) and trailers. Posting a submission on our
website will cost $19.95. Submission fees are intended to defray our
operational costs, and we do not expect them to result in positive revenue. All
submissions may be viewed by any visitor to our website free of charge.
Visitors may vote online for their favorite submission. At the end of each
calendar year, commencing in 2008, we will offer the director of the submission
receiving the most votes on our website an opportunity to direct a feature film
based on the submission. To this end, we will also commission a feature-length
screenplay to be written by a professional writer, based on the submission. We
will exclusively own all right title and interest in and to the screenplay and
any film derived from it. We may make similar offers in respect of other
submissions.
We plan to employ a flexible strategy in developing and producing our motion
picture and film properties. We will use our own capital and financial
resources to develop a project to the point where it is ready to go into
production. For each motion picture, we will assemble a business plan for
presentation to prospective investors and financiers, consisting of the
screenplay, a budget, shooting schedule, production board and the commitment by
a recognizable actor or director.
We believe that we should be able to secure recognizable talent based on the
attractiveness of the screenplay but we may also offer, as an added incentive,
grants of our stock or options to acquire our stock. We will then secure the
financing to produce the movie and make it available for distribution. The
financing may come from federal and provincial governments, financial
institutions, lenders with profit participation, advances from distribution
companies, accredited investors or a combination of outside sources.
By developing a film project to this advanced stage, we believe that we will be
able to maximize our leverage in negotiating production and financing
arrangements. Nevertheless, there may be situations when we may benefit from
financial assistance at an earlier stage. These occasions may be necessary as a
11
result of lengthy development of a screenplay, the desirability of commissioning
a screenplay by a highly paid writer, the acquisition of an expensive underlying
work, or a significant financial commitment to a director or star.
It is common for motion picture producers to grant contractual rights to actors,
directors, screenwriters, and other creative and financial contributors to share
in revenue or net profits from the motion picture. Except for the most
sought-after talent, these third-party participants are generally paid after all
distribution fees, marketing expenses, direct production costs and financing
costs are recouped in full. We plan to be flexible in compensating talent. We
are not adverse to entering into profit sharing arrangements. We will also
consider the use of our securities to reward the actors and other participants
in a successful motion picture.
Motion picture revenue is derived from the worldwide licensing of a film to
several distinct markets, each having its own distribution network and potential
for profit. The selection of the distributor for each of our feature films will
depend upon a number of factors. Our most basic criterion is whether the
distributor has the ability to secure bookings for the exhibition of the film on
satisfactory terms. We will consider whether, when and in what amount the
distributor will make advances to us. We will also consider the amount and
manner of computing distribution fees and the extent to which the distributor
will guarantee certain print, advertising and promotional expenditures. We will
not attempt to obtain financing for the production of a particular film unless
we believe that adequate distribution arrangements for the film can be made.
No assurance can be given that our motion pictures, if produced, will be
distributed and, if distributed, will return our initial investment or make a
profit. To achieve the goal of producing profitable feature films, we plan to be
extremely selective in our choice of literary properties and exercise a high
degree of control over the cost of production. Although we plan to produce
films that will generate substantial box office receipts, we will produce our
films in a fiscally conservative manner. We believe that it is possible for a
feature film to return the initial investment and show a profit based on an
average box office run, with residuals from the sale of ancillary rights adding
to cash flow in future years. By keeping strict control of our costs, we will
strive for consistent and profitable returns on our investment.
FEATURE FILM PRODUCTION
Feature film production does not require the ownership of expensive equipment.
All the necessary equipment needed to engage in every aspect of the film
production process can be rented or borrowed for the period in which it is
needed. This is standard operating procedure for all production companies
within the industry and we plan to follow this procedure in our productions.
Such rentals and temporary equipment are accounted for in the budget of each
film in what are called the "below the line" costs that are directly charged to
the production or the cost of "manufacturing" the film. We plan to rent
whatever equipment is needed for the shortest period of time and to coordinate
its use to avoid idle time.
Essential to our success will be the production of high quality films having
budgets of $5 million or less that have the potential to be profitable. We will
not engage in the production of X-rated material. We plan to make motion
pictures that appeal to the tastes of the vast majority of the movie-going
public. Our films will be cast into a wide range of genres, with our initial
focus being on suspense, drama, and comedy. All our films will be suitable for
domestic and international theatrical exhibition, pay cable, network and
syndicated television, as well as all other ancillary markets.
The low budgets within which we intend to operate will serve the dual purpose of
being low enough to limit our downside exposure and high enough to pay for a
feature film with accomplished actors or directors that appeal to the major
markets. The market pull of the talent to be used must justify their fees by
helping to attract advances. Our budgets must remain small enough so that a
large percentage of our capital is not put at risk. We intend to produce
projects with built-in break-even levels that can be reached with ancillary and
foreign distribution revenue. If the movie crosses-over into a wide national
distribution release, we can potentially generate a large profit because our
share is not limited as with ancillary and foreign revenue.
In order to produce quality motion pictures for relatively modest budgets, we
will seek to avoid the high operating expenses that are typical of major U.S.
studio productions. We do not plan on having high overhead caused by large
staff, interest charges, substantial fixed assets, and investment in a large
number of projects that are never produced. We believe that by maintaining a
smaller, more flexible staff, with fewer established organizational restrictions
we can further reduce costs through better time management than is possible in a
major studio production.
We also plan to enter into co-productions with experienced and qualified
production companies in order to become a consistent supplier of motion pictures
to distributors in the world markets. With dependable and consistent delivery
of product to these markets, we believe that distribution arrangements can be
structured that will be equivalent to the arrangements made by major studios.
We do not want to relinquish control of our productions, so we intend to provide
up to 50% of the required funds. We may obtain our portion of the production
costs from third parties in the form of debt financing, profit participation or
12
such financing, and as such, we may be required to relinquish control of the
project. If we lose control of the project then we will likely be unable to
influence the production, sale, distribution or licensing of the film.
Primary responsibility for the overall planning, financing and production of
each motion picture will rest with our management. For each motion picture we
will employ an independent film director who will be responsible for, or
involved with, many of the creative elements, such as direction, photography,
and editing. All decisions will be subject to budgetary restrictions and our
business control, although we will permit an independent director to retain
reasonable artistic control of the project, consistent with its completion
within strict budget guidelines and the commercial requirements of the picture.
FINANCING STRATEGY
We will not be able to produce a feature film on our own with the proceeds of
this offering without additional outside financing and the deferral of certain
production costs. Wherever possible we will attempt to make arrangements with
providers of goods and services to defer payment until a later stage in the
production and financing cycle. Once a film package has been assembled, there
are various methods to obtain the funds needed to complete the production of a
motion picture. Examples of financing alternatives include the assignment of
our rights in a film to a joint venture or a co-producer. Alternatively, we may
form a limited liability company or partnership where we will be the managing
member or the general partner. We may also obtain favorable pre-release sales or
pre-licensing commitments from various end-users such as independent domestic
distributors, foreign distributors, cable networks, and video distributors.
These various techniques, which are commonly used in the industry, can be
combined to finance a project without a major studio financial commitment. We
do not intend to sell shares of our capital stock to finance the production of
any film.
By virtue of our location in Canada, we may be able to obtain financial support
from the Canadian federal and provincial governments. By operating in Canada,
we expect to be able to borrow against tax credits obtained through Canadian
federal and provincial production services tax credits. These tax credits will
enable to us to recover 27% to 33% of eligible labor costs, or approximately
13.5% to 16.5% of our total production budget. Canadian banks commonly allow
producers to borrow against such tax credits in producing motion pictures. Our
location in Canada may also allow us to access foreign government financing
through international co-productions with treaty countries.
We may use any one or a combination of these or other techniques to finance our
films. We anticipate that any financing method will permit us to maintain
control over the production. There can be no assurance that we will be able to
successfully arrange for such additional financing and to the extent we are
unsuccessful, our production activities may be adversely affected.
As part of our financing strategy, we may use some of the proceeds of this
offering that are allocated to movie production to be used as an advance payment
to secure the services of a star actor. This will assure the actor's services
and will assist us in obtaining financing to produce the movie.
DISTRIBUTION ARRANGEMENTS
Effective distribution is critical to the economic success of a feature film,
particularly when made by an independent production company. We have not as yet
negotiated any distribution agreements.
We intend to release our films in the United States through existing
distribution companies, primarily independent distributors. We will retain the
right for ourselves to market the films on a territory-by-territory basis
throughout the rest of the world and to market television and other uses
separately. In many instances, depending upon the nature of distribution terms
available, it may be advantageous or necessary for us to license all, or
substantially all, distribution rights through one major distributor.
It is not possible to predict, with certainty, the nature of the distribution
arrangements, if any, that we may secure for our motion pictures.
To the extent that we engage in foreign distribution of our films, we will be
subject to all of the additional risks of doing business abroad including, but
not limited to, government censorship, currency fluctuations, exchange controls,
greater risk of "piracy" copying, and licensing or qualification fees.
COMPETITION
The motion picture industry is intensely competitive. Competition comes from
companies within the same business and companies in other entertainment media
that create alternative forms of leisure entertainment. The industry is
currently evolving such that certain multinational multimedia firms will be able
to dominate because of their control over key film, magazine, and television
13
content, as well as key network and cable outlets. These organizations have
numerous competitive advantages, such as the ability to acquire financing for
their projects and to make favorable arrangements for the distribution of
completed films.
We will be competing with the major film studios that dominate the motion
picture industry. Some of these firms we compete with include: Lion's Gate
Entertainment, Twentieth Century Fox; AOL Time Warner's Warner Bros. including
Turner, New Line Cinema and Castle Rock Entertainment; Viacom's Paramount
Pictures; Vivendi Universal's Universal Studios; Sony Corp.'s Sony Pictures
including Columbia and TriStar; Walt Disney Company's Buena Vista, Touchstone
and Miramax and Metro-Goldwyn-Mayer including MGM Pictures, UA Pictures, Orion
and Goldwyn. We will also compete with numerous independent motion picture
production companies, television networks, and pay television systems, for the
acquisition of literary properties, the services of performing artists,
directors, producers, and other creative and technical personnel, and production
financing. Nearly all of our competitors are organizations of substantially
larger size and capacity, with far greater financial and personnel resources and
longer operating histories, and may be better able to acquire properties,
personnel and financing, and enter into more favorable distribution agreements.
Our success will depend on public taste, which is both unpredictable and
susceptible to rapid change.
As an independent film production company, we most likely will not have the
backing of a major studio for production and distribution support.
Consequently, we may not be able to complete a motion picture. If we do, we may
not be able to make arrangements for exhibition in theaters. Our success in
theaters may determine our success in other media markets.
In order to be competitive, we intend to create independent motion pictures of
aesthetic and narrative quality comparable to the major film studios that appeal
to a wide range of public taste both in the United States and abroad. By
producing our films in Canada we believe that we will be able to significantly
reduce production costs, and thereby offer our films to distributors at
extremely competitive pricing. We plan to be very selective when developing
screenplays. We plan to produce our motion pictures efficiently, by employing
talented and established professionals with experience in the industry. Also,
we plan on exploiting all methods of distribution available to motion pictures.
INTELLECTUAL PROPERTY RIGHTS
Rights to motion pictures are granted legal protection under the copyright laws
of the United States and most foreign countries, including Canada. These laws
provide substantial civil and criminal penalties for unauthorized duplication
and exhibition of motion pictures. Motion pictures, musical works, sound
recordings, artwork, and still photography are separately subject to copyright
under most copyright laws. We plan to take appropriate and reasonable measures
to secure, protect, and maintain copyright protection for all of our pictures
under the laws of the applicable jurisdictions. Motion picture piracy is an
industry-wide problem. Our industry trade association provides a piracy hotline
and investigates all piracy reports. The results of such investigations may
warrant legal action, by the owner of the rights, and, depending on the scope of
the piracy, investigation by the Federal Bureau of Investigation and/or the
Royal Canadian Mounted Police with the possibility of criminal prosecution.
Under the copyright laws of Canada and the United States, copyright in a motion
picture is automatically secured when the work is created and "fixed" in a copy.
We intend to register our films for copyright with both the Canadian Copyright
Office and the United States Copyright Office. Both offices will register
claims to copyright and issue certificates of registration but neither will
"grant" or "issue" copyrights. Only the expression (camera work, dialogue,
sounds, etc.) fixed in a motion picture can be protected under copyright.
Copyright in both Canada and the United States does not cover the idea or
concept behind the work or any characters portrayed in the work. Registration
with the appropriate office establishes a public record of the copyright claim.
Ordinarily, a number of individuals contribute authorship to a motion picture,
including the writer, director, producer, camera operator, editor, and others.
Under the laws of both Canada and the United States, these individuals are not
always considered the "authors," however, because a motion picture is frequently
a "work made for hire." In the case of a work made for hire, the employer, not
the individuals who actually created the work, is considered the author for
copyright purposes. We intend all of our films to be works made for hire in
which we will be the authors and thereby own the copyright to our films.
Canada's copyright law is distinguished from that of the United States by
recognizing the moral rights of authors. Moral rights refer to the rights of
authors to have their names associated with their work, and the right to not
have their work distorted, mutilated or otherwise modified, or used in
association with a product, service, cause or institution in a way that is
prejudicial to their honor or reputation. Moral rights cannot be sold or
transferred, but they can be waived. We intend that all individuals who
contribute to the creation of any of our motion pictures will be required to
waive any such moral rights that they may have in the motion picture.
For copyright purposes, publication of a motion picture takes place when one or
more copies are distributed to the public by sale, rental, lease or lending, or
when an offering is made to distribute copies to a group of persons
14
(wholesalers, retailers, broadcasters, motion picture distributors, and the
like) for purposes of further distribution or public performance. A work that is
created (fixed in tangible form for the first time) on or after January 1, 1978,
is automatically protected from the moment of its creation and is ordinarily
given a term enduring for the author's life plus an additional 70 years after
the author's death. For works made for hire, the duration of copyright will be
95 years from publication or 120 years from creation, whichever is shorter.
Although we plan to copyright all of our film properties and projects, there is
no practical protection from films being copied by others without payment to us,
especially overseas. We may lose an indeterminate amount of revenue as a result
of motion picture piracy. Being a small company, with limited resources, it will
be difficult, if not impossible, to pursue our various remedies.
Motion picture piracy is an international as well as a domestic problem. It is
extensive in many parts of the world. In addition to the Motion Picture
Association of America, the Motion Picture Export Association, the American Film
Marketing Association, and the American Film Export Association monitor the
progress and efforts made by various countries to limit or prevent piracy. In
the past, these various trade associations have enacted voluntary embargoes of
motion picture exports to certain countries in order to pressure the governments
of those countries to become more aggressive in preventing motion picture
piracy. The United States government has publicly considered trade sanctions
against specific countries that do not prevent copyright infringement of
American motion pictures. There can be no assurance that voluntary industry
embargoes or United States government trade sanctions will be enacted. If
enacted, such actions may impact the revenue that we realize from the
international exploitation of our motion pictures. If not enacted or if other
measures are not taken, the motion picture industry, including us, may lose an
indeterminate amount of revenue as a result of motion picture piracy.
CENSORSHIP
An industry trade association, the Motion Picture Association of America,
assigns ratings for age group suitability for domestic theatrical distribution
of motion pictures under the auspices of its Code and Rating Administration. The
film distributor generally submits its film to the Code and Rating
Administration for a rating. We plan to follow the practice of submitting our
motion pictures for ratings.
Television networks and stations in the United States as well as some foreign
governments may impose additional restrictions on the content of a motion
picture that may wholly or partially restrict exhibition on television or in a
particular territory.
We will not engage in the production of X-rated material. We plan to make motion
pictures that appeal to the tastes of the vast majority of the movie-going
public. We plan to produce our motion pictures so there will be no material
restrictions on exhibition in any major market or media. This policy may require
production of "cover" shots or different photography and recording of certain
scenes for insertion in versions of a motion picture exhibited on television or
theatrically in certain territories.
There can be no assurance that current and future restrictions on the content of
our films may not limit or affect our ability to exhibit our pictures in certain
territories and media.
Theatrical distribution of motion pictures, in a number of states and certain
jurisdictions, is subject to provisions of trade practice laws passed in those
jurisdictions. These laws generally seek to eliminate the practice known as
"blind bidding" and prohibit the licensing of films unless theater owners are
invited to attend screenings of the film first. In certain instances, these laws
also prohibit payment of advances and guarantees to film distributors by
exhibitors.
LABOR LAWS
We are aware that the cost of producing and distributing filmed entertainment
has increased substantially in recent years. This is due, among other things, to
the increasing demands of creative talent as well as industry-wide collective
bargaining agreements. Many of the screenplay writers, performers, directors and
technical personnel in the entertainment industry who will be involved in our
productions are members of guilds or unions that bargain collectively on an
industry-wide basis. We have found that actions by these guilds or unions can
result in increased costs of production and can occasionally disrupt production
operations. If such actions impede our ability to operate or produce a motion
picture, it may substantially harm our ability to earn revenue.
We will use non-unionized talent whenever possible to reduce our costs of
production. Notwithstanding, many individuals associated with our productions,
including actors, writers and directors, will be members of guilds or unions,
that bargain collectively with producers on an industry-wide basis from time to
time. Our operations will be dependent upon our compliance with the provisions
of collective bargaining agreements governing relationships with these guilds
and unions. Strikes or other work stoppages by members of these unions could
15
delay or disrupt our activities. The extent to which the existence of
collective bargaining agreements may affect us in the future is not currently
determinable.
DESCRIPTION OF PROPERTY
We are presently using office space in Calgary, Alberta, provided at no cost by
our President. If we are able to sell all of the offered shares, we intend to
lease office 1,000 square feet of office space in the Calgary region.
PLAN OF OPERATION
THE FOLLOWING DISCUSSION AND ANALYSIS OF OUR PLAN OF OPERATION SHOULD BE READ IN
CONJUNCTION WITH THE FINANCIAL STATEMENTS AND THE RELATED NOTES. THIS DISCUSSION
CONTAINS FORWARD-LOOKING STATEMENTS BASED UPON CURRENT EXPECTATIONS THAT INVOLVE
RISKS AND UNCERTAINTIES, SUCH AS OUR PLANS, OBJECTIVES, EXPECTATIONS AND
INTENTIONS. OUR ACTUAL RESULTS AND THE TIMING OF CERTAIN EVENTS COULD DIFFER
MATERIALLY FROM THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A
RESULT OF CERTAIN FACTORS, INCLUDING THOSE SET FORTH UNDER "RISK FACTORS,"
"DESCRIPTION OF BUSINESS" AND ELSEWHERE IN THIS PROSPECTUS. SEE "RISK FACTORS"
AND "DESCRIPTION OF BUSINESS".
Upon completing this offering, we intend to develop screenplays that can be
produced into commercially successful motion pictures having budgets of $5
million or less. Such development will include the purchase of exclusive
options to acquire existing screenplays and the commissioning of a screenplay
based on a submission to our website. We plan to complete this development by
March 1, 2009. To date, we have not secured any options to acquire screenplays
or entered into any agreements regarding any other development projects.
Our website, located on the Internet at www.starflick.com, is being developed
and is expected to be fully operational by January 31, 2008. We expect the
final development cost of our website to be $43,000. To the extent that we are
unable to sell all of the offered shares, our President will advance sufficient
funds to complete development of our website.
The purpose of our website is to encourage the submission of short films (less
than 11 minutes) and trailers by aspiring filmmakers. Posting a submission on
our website will cost $19.95. Submission fees are intended to defray our
operating costs and we do not expect them to result in positive revenue. All
submissions may be viewed by any visitor to our website free of charge.
Visitors may vote online for their favorite submission.
At the end of each calendar year, commencing in 2008, we will offer the director
of the submission receiving the most votes on our website an opportunity to
direct a feature film based on the submission. To this end, we will also
commission a feature-length screenplay to be written by a professional writer,
based on the submission. We will exclusively own all right title and interest
in and to the underlying screenplay and any film derived from it. We may make
similar offers in respect of other submissions.
The minimum script fee for productions subject to the Independent Production
Agreement (the "IPA") between the Writers' Guild of Canada and the Canadian Film
and Television Production Association ("CFTPA") is approximately $40,000 per
script. Small, independent producers, like Giddy-up Productions, are not
members of the CFTPA and are not bound by the IPA or its minimum script fee.
Script fees in Canada are highly negotiable for small, independent producers,
beginning at approximately $5,000 per script, and increasing with the experience
and notoriety of the writer. We have set the upper threshold for our
commissioned screenwriting budget at $10,000 per script. This amount was
arbitrarily determined by our management based on their experience and
assessment of our requirements.
The number of screenplays to which we will be able to secure production rights
during the development stage will depend upon the success of this offering. We
plan to develop at least one screenplay based on the submission to our website
that receives the most votes in 2008, regardless of the number of shares we sell
in this offering. If the proceeds from this offering are insufficient to pay
for such development, our President will advance up to $10,000 on our behalf in
this regard. If we sell 50% of our offering (1,000,000 shares) we expect to
have options to acquire two screenplays plus the commissioned screenplay. If we
are successful in selling 75% of this offering (1,500,000 shares), we plan to
have options to acquire five screenplays in addition to the commissioned
screenplay.
We intend to be very selective when choosing literary properties to develop.
All stories must be character driven, with a gripping plot, engaging characters,
and subplots that are inextricably interwoven with the main plot. They must
appeal to a mass audience with a rating of PG, PG-13 or R, and should be within
the genres of suspense, drama or comedy. No screenplay that we select or
develop will require more than three main characters, five minor characters,
fifteen bit characters. Scripts cannot require more than 150 extras throughout
the entire production, or more than 80 extras in any single scene. Stories
should take place between 35-42 different locations, but production must be
limited to no more than 10-20 physical locations. Scenes must be limited to
16-21 interior and 14-18 exterior, with approximately 80% synchronous sound. We
16
will not consider any scripts that require more than two special effects scenes,
location scenes involving talent, staff or crew travel or per diems, futuristic
or period sets, props or wardrobe.
In addition to developing screenplays, we intend to pursue distribution of Not
That Kind Of Girl for exploitation in all markets and media. If we are unable
to obtain any satisfactory distribution arrangements, we may consider selling
all rights to Not That Kind Of Girl outright. It is impossible to predict how
long it may take for us to obtain distribution or sale of Not That Kind Of Girl,
or what the value of any such distribution or sale would be. There can be no
assurance that we will obtain satisfactory distribution arrangements for Not
That Kind Of Girl, or that we will be able to sell it.
We will not be able to produce a feature film with the proceeds of this
offering, regardless of the amount raised, without additional outside financing
and cost deferral. We do not intend to finance the production of any film by
selling shares of our capital stock, but rather, through a variety of outside
sources. We will apply for funding through the Canadian federal and provincial
governments, and for production services tax credits. We will attempt to obtain
favorable pre-release sales or pre-licensing commitments from independent U.S.
distributors, foreign distributors, cable networks, and video distributors. We
will request that providers of goods and services accept deferred payment
arrangements. We also may assign a portion of our film rights to a joint venture
or a co-producer. In addition, we will consider the formation of a limited
liability company or partnership for which we will act as managing member or
general partner and privately offer membership or partnership interests to film
venture capitalists. We do not have any present plans, proposals, arrangements
or understandings with any parties that will provide production financing. If
we are unable to obtain production financing for any film, then we may be
compelled to abandon production of the film.
By March 1, 2009, we will select one of our developed screenplays for
pre-production. Our choice of screenplay for pre-production will be dependent
upon various factors including cost, location, marketability and producer
availability. During the pre-production stage, we will prepare a business plan
for the film to present to prospective investors and financiers. We will also
attempt to obtain the commitment of a recognizable actor or director, secure the
services of a co-producer, finalize the screenplay, and prepare a budget,
preliminary shooting schedule and production board. The commitment of a
recognizable acting or directing talent is often useful to secure production
financing. There can be no assurance that we will be able to secure a
recognizable actor or director for our films, which may hinder our ability to
obtain financing.
The business plan, together with the screenplay, budget, shooting schedule,
production board and any talent commitment will then be presented to prospective
investors and financiers by our management. We estimate that it will take four
months to complete the pre-production of a film to the point that a business
plan can be presented, and cost approximately $12,000.
If we are successful in obtaining sufficient production financing for a motion
picture, then we will complete pre-production of the picture, including the
hiring of a production team; hiring a casting director to submit the screenplay
to appropriate actors as recommended by their agents or as deemed appropriate by
us; developing relationships with foreign sales companies to pre-sell foreign
film distribution rights; and finalizing shooting location arrangements. We
anticipate that it will take a further three months to complete pre-production
of the motion picture once we have obtained our financing.
Having completed the pre-production of a motion picture, we will commence
production. The duration of principal photography is established by the
shooting schedule during pre-production, with allowances for delays caused by
such things as inclement weather, illness, injury, location unavailability. We
intend to limit principal photography of any of our motion pictures to a total
of three months. We estimate that it will that post-production will take four
months to complete. This includes editing, sound, mixing and the final print.
We do not intend to make any films that cost more than $5 million for production
and post-production.
We will not earn revenue from the production of a motion picture unless we sell
or license our film to a distributor. As such, effective distribution
agreements will be critical to our economic success. We have not as yet
negotiated agreements for the distribution of our films. We will attempt to
pre-sell distribution rights during the pre-production stage in order to obtain
financing for our motion pictures. If we are unsuccessful in pre-selling
distribution rights, we will be required to obtain a distribution deal after
post-production. We intend to market our films through personal contacts of our
officers, and through a film representation company. We expect that the cost of
retaining a film representation company will be $2,500 per film.
We intend to release our films in the United States through existing
distribution companies, primarily independent distributors. We will retain the
right for ourselves to market the films on a territory-by-territory basis
throughout the rest of the world and to market television and other uses
separately. In many instances, depending upon the nature of distribution terms
available, it may be advantageous or necessary for us to license all, or
substantially all, distribution rights through one major distributor. It is not
possible to predict, with certainty, the nature of the distribution
arrangements, if any, which we may secure for our motion pictures.
17
To the extent that we engage in foreign distribution of our films, we will be
subject to all of the additional risks of doing business abroad including, but
not limited to, government censorship, currency fluctuations, exchange controls,
greater risk of "piracy" copying, and licensing or qualification fees.
If we are unable to obtain theatrical distribution on acceptable terms, we may
evaluate other alternatives such as retaining a distributor as an independent
contractor or bypassing theatrical distribution altogether. If we retain a
distributor as an independent contractor we may need to seek additional
financing to cover this cost, which we anticipate will be $50,000 to $100,000
per film. If we bypass theatrical distribution and attempt to release our films
directly to pay cable or home video, we will probably not generate enough
revenues to become profitable. If we are unable to obtain adequate
distribution, we may not have the ability to generate revenues.
We do not intend to hire any employees during the next 12 months. Instead, we
will utilize independent contractors, consultants, and other non-employee
creative personnel to assist in the development and pre-production of our motion
pictures as needed.
We intend to purchase a digital camera from the proceeds of this offering. We
do not plan to purchase any other significant equipment during the next 12
months.
RESULTS OF OPERATIONS
We did not earn any revenue during the period from inception on August 30, 2007
to November 30, 2007. We do not anticipate earning revenue until such time as
we are able to sell the distribution rights to a motion picture. We are
presently in the development stage of our business and we can provide no
assurance that Not That Kind Of Girl or any motion picture that we produce will
be commercially successful.
We incurred operating expenses in the amount of $26,191 for the period from
inception on August 30, 2007 to November 30, 2007. These operating expenses
were entirely due to legal costs involved in the organization of our company and
consulting fees paid for the preparation of this prospectus. We anticipate that
our operating expenses will increase significantly once we commence operations.
LIQUIDITY AND CAPITAL RESOURCES
Our business is in the early stages of development. We have not earned any
revenue to date. As of November 30, 2007 we had total assets of $27,585
comprised of cash and cash equivalents of $10,135, prepaid expenses of $6,637and
the feature-length film, "Not That Kind Of Girl," that we acquired from our
President for its original cost of $10,813. Our total liabilities are $42,463
comprised of a promissory note of $10,000, accounts payable and accrued
liabilities of $4,876 and debt owing to a director of the Company ($27,587) for
the estimated cost of preparation of this registration statement of which this
prospectus forms a part. We intend to repay the amount presently owing to our
directors from the proceeds of this offering.
Since inception on August 30, 2007, our business activities have been entirely
financed by our directors. On November 12, 2007, we issued an unsecured
promissory note in the amount of $10,000 to our President. The promissory note
accrues interest at the rate of five per cent per year and is due and payable on
demand. Proceeds of the note were used to pay for startup costs, accounting
fees, and miscellaneous expenses.
We do not have sufficient working capital to meet the anticipated cash
requirements of our business plan for the next 12 months. We are dependent upon
the proceeds from this offering to implement our business plan. The net
proceeds from the sale of all of our offering will be sufficient to meet the
anticipated cash requirements of our business plan for at least the next 12
months. To the extent that we are unable to sell all of the offered shares, our
President will advance sufficient funds on our behalf to pay for development of
our website, marketing of "Not That Kind Of Girl", and professional fees for the
next 12 months of operations. We will be required to seek additional financing
to fund our other business objectives.
We anticipate that any additional funding that we require will be in the form of
equity financing from the sale of our common stock. There is no assurance,
however, that we will be able to raise sufficient funding from the sale of our
common stock. The risky nature of this enterprise and lack of tangible assets
places debt financing beyond the credit-worthiness required by most banks or
typical investors of corporate debt until such time as an economically viable
mine can be demonstrated. We do not have any arrangements in place for any
future equity financing. If we are unable to secure additional funding, we will
cease or suspend operations. We have no plans, arrangements or contingencies in
place in the event that we cease operations.
18
LEGAL PROCEEDINGS
Neither Giddy-up Productions Inc., nor any of its officers or directors is a
party to any material legal proceeding or litigation and such persons know of no
material legal proceeding or contemplated or threatened litigation. There are
no judgments against Giddy-up or its officers or directors. None of our
officers or directors have been convicted of a felony or misdemeanor relating to
securities or performance in corporate office.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following sets forth our directors, executive officers, promoters and
control persons, their ages, and all offices and positions held. Directors are
elected for a period of one year and thereafter serve until their successor is
duly elected by the shareholders. Officers and other employees serve at the
will of the Board of Directors.
----------------------------------------------------
TERM PERIOD
SERVED AS
NAME POSITION AGE DIRECTOR/OFFICER
----------------------------------------------------
Zoltan Nagy CEO, President, 41 2007 to present
Treasurer,
Secretary,
director
----------------------------------------------------
Marnie Kuhn director 40 2007 to present
====================================================
Zoltan Nagy has served as our President, Chief Executive Officer, Treasurer,
Secretary and a director as of August 2007. Since 2002, he has been active in
the filmed entertainment industry as an actor, production assistant, camera
operator and director on several television shows, commercials and motion
pictures. Mr. Nagy received a diploma in film direction from Los Angeles City
College in 1993. He presently devotes 30 hours a week to our business.
Marnie Kuhn has served as a director as of September 2007. Since 2005, Ms. Kuhn
has worked with Zoltan Nagy in the entertainment industry as a producer and
production accountant. Previously, Ms. Kuhn was employed as a manager by
Integrative Healing Arts, a naturopathic clinic. Ms. Kuhn presently devotes 2
hours per week to our business.
Mr. Nagy is the only "promoter" of our company, as defined by the Rule 405 of
the Securities Act.
The address for all our officers and directors is 409 - 903 19th Avenue SW,
Calgary, AB T2T 0H8.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
During the past five years none of our directors, executive officers, promoters
or control persons have:
(1) had any bankruptcy petition filed by or against any business of which
such person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that time;
(2) been convicted in a criminal proceeding or subject to a pending criminal
proceeding;
(3) been subject to any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise limiting
his involvement in any type of business, securities or banking activities; or
(4) been found by a court of competent jurisdiction in a civil action, the
Commission or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the judgment has not been
reversed, suspended, or vacated.
COMMITTEES OF THE BOARD
All proceedings of the board of directors for the year ended August 31, 2007
were conducted by resolutions consented to in writing by our board of directors
and filed with the minutes of the proceedings of our board of directors. We do
not currently have a nominating, compensation or audit committees or committees
performing similar functions nor do we have a written nominating, compensation
or audit committee charter. Our board of directors does not believe that it is
necessary to have such committees because it believes that the functions of such
committees can be adequately performed by the board of directors.
We do not have any defined policy or procedure requirements for shareholders to
submit recommendations or nominations for directors. The board of directors
believes that, given the stage of our development, a specific nominating policy
would be premature and of little assistance until our business operations
19
develop to a more advanced level. We do not currently have any specific or
minimum criteria for the election of nominees to the board of directors and we
do not have any specific process or procedure for evaluating such nominees. The
board of directors will assess all candidates, whether submitted by management
or shareholders, and make recommendations for election or appointment.
A shareholder who wishes to communicate with our board of directors may do so by
directing a written request addressed to our President, Zoltan Nagy, at the
address appearing on the first page of this prospectus.
AUDIT COMMITTEE FINANCIAL EXPERT
We do not have a standing audit committee. Our directors perform the functions
usually designated to an audit committee. Our board of directors has determined
that we do not have a board member that qualifies as an "audit committee
financial expert" as defined in Item 401(e) of Regulation S-B, nor do we have a
board member that qualifies as "independent" as the term is used in Item
7(d)(3)(iv)(B) of Schedule 14A under the Securities Exchange Act of 1934, as
amended, and as defined by Rule 4200(a)(14) of the NASD Rules.
We believe that our board of directors is capable of analyzing and evaluating
our financial statements and understanding internal controls and procedures for
financial reporting. The board of directors of our company does not believe that
it is necessary to have an audit committee because management believes that the
functions of an audit committees can be adequately performed by the board of
directors. In addition, we believe that retaining an independent director who
would qualify as an "audit committee financial expert" would be overly costly
and burdensome and is not warranted in our circumstances given the stage of our
development and the fact that we have not generated any positive cash flows from
operations to date.
As we generate revenue in the future, we intend to form a standing audit
committee and identify and appoint a financial expert to serve on our audit
committee.
EXECUTIVE COMPENSATION
To date we have no employees other than our officers. No compensation has been
awarded, earned or paid to our officers. We have no employment agreements with
any of our officers. We do not contemplate entering into any employment
agreements until such time as we earn revenue.
There is no arrangement pursuant to which any director of Giddy-up Productions
has been or is compensated for services provided as a director of Giddy-up
Productions.
There are no stock option plans, retirement, pension, or profit sharing plans
for the benefit of our officers or directors. We do not have any long-term
incentive plans that provide compensation intended to serve as incentive for
performance.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We have issued common stock to the following officers, directors, promoters and
beneficial owners of more than 5% of our outstanding securities.
--------------------------------------------------------------------------------
NAME POSITION WITH COMPANY SHARES CONSIDERATION DATE
--------------------------------------------------------------------------------
Zoltan Nagy CEO, President, 8,000,000 $ 40,000 August 31, 2007
Treasurer,
Secretary,
director
Marnie Kuhn director 100,000 $ 500 September 8, 2007
================================================================================
On August 31, 2007, we purchased all right, title and interest in and to a
feature-length motion picture entitled "Not That Kind of Girl" from our
President for consideration of $40,000. Our President agreed to accept and was
issued 8,000,000 common shares of our capital stock in lieu of the $40,000 owing
to him as a result of the acquisition of the motion picture. In accordance with
SEC Staff Accounting Bulletin 5G "Transfers of Non-monetary Assets by Promoters
or shareholders", provided that transfer of non-monetary assets to a company by
its promoters or shareholders in exchange for stock prior to or at the time of
the Company's initial public offering normally should be recorded at the
transferor's historical cost basis determined under GAAP. Pursuant to SEC Staff
Accounting Bullentin 5G, the Company has recorded the film property at its
estimated original cost of $10,813 by crediting the film property with $29,187
and debiting the additional paid-in capital with $29,187.This transaction was
evaluated as being fair by our directors reviewing the transaction without third
party advice or consultation.
20
On November 12, 2007, we issued an unsecured promissory note in the amount of
$10,000 to our President. The promissory note accrues interest at the rate of
five per cent per year and is due and payable on demand. Proceeds of the note
were used to pay for startup costs, accounting fees, and miscellaneous expenses.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of our common stock as of the date of this prospectus by (i) each
person known by us to be a beneficial owner of more than five percent (5%) of
our issued and outstanding common stock; (ii) each of our Directors and
executive officers; and (iii) all our directors and executive officers as a
group.
------------------------------------------------------------------------
NAME NUMBER OF SHARES %
------------------------------------------------------------------------
Zoltan Nagy 8,000,000 99
409 - 903 19th Avenue SW
Calgary, AB T2T 0H8
Marnie Kuhn 100,000 1
409 - 903 19th Avenue SW
Calgary, AB T2T 0H8
-----------------------------------------------------------------------
Directors and officers as a group (two persons) 8,100,000 100
=======================================================================
Unless otherwise noted, we believe that all persons named in the table have sole
voting and investment power with respect to all shares of common stock
beneficially owned by them. For purposes hereof, a person is considered to be
the beneficial owner of securities that can be acquired by such person within 60
days from the date hereof, upon the exercise of warrants or options or the
conversion of convertible securities. Each beneficial owner's percentage
ownership is determined by assuming that any such warrants, options or
convertible securities that are held by such person (but not those held by any
other person) and which can be exercised within 60 days from the date hereof,
have been exercised.
FUTURE SALES BY EXISTING STOCKHOLDERS
A total of 8,000,000 shares of common stock were issued to Zoltan Nagy, our
President, on August 31, 2007. A further 100,000 shares of common stock were
issued to Marnie Kuhn, a director, on September 28, 2007. The 8,100,000 shares
so issued are restricted securities, as defined in Rule 144 of the Rules and
Regulations of the SEC promulgated under the Securities Act. Under Rule 144, the
shares can be publicly sold, subject to volume restrictions and restrictions on
the manner of sale, commencing one year after their acquisition. Rule 144
provides that a person may not sell more than 1% of the total outstanding shares
in any three month period and the sales must be sold either in a brokers'
transaction or in a transaction directly with a market maker.
Shares purchased in this offering, which will be immediately resalable, and
sales of all of our other shares after applicable restrictions expire, could
have a depressive effect on the market price, if any, of our common stock and
the shares we are offering.
A total of 8,100,000 shares of our stock are currently owned by our officers and
directors. They will likely sell a portion of their stock if a trading market
for our common stock develops. If they do sell their stock into the market, the
sales may cause the market price of the stock to drop.
Because our officers and directors will control us after this offering,
regardless of the number of shares sold, our shareholders will be unable to
cause a change in the course of our operations. As such, the value attributable
to the right to vote is gone, which could result in a reduction in share value.
PLAN OF DISTRIBUTION
We offer the right to subscribe for up to 2,000,000 shares at the offering price
of $0.10 per share. No compensation is to be paid to any person for the offer
and sale of the shares.
Zoltan Nagy, our President, will distribute all prospectuses related to this
offering. Mr. Nagy will not register as a broker-dealer under Section 15 of the
Securities Exchange Act of 1934 (the "Exchange Act") in reliance upon Rule
21
3a4-1. Rule 3a4-1 sets forth those conditions under which a person associated
with an issuer may participate in the offering of an issuer's securities and not
be deemed to be a broker-dealer. These conditions are as follows:
1. The person is not subject to a statutory disqualification, as that term
is defined in Section 3(a)(39) of the Exchange Act, at the time of his
participation;
2. The person is not compensated in connection with his participation by the
payment of commissions or other remuneration based either directly or indirectly
on transactions in securities;
3. The person is not, at the time of their participation, an associated
person of a broker-dealer; and
4. The person meets the conditions of paragraph (a)(4)(ii) of Rule 3a4-1 of
the Exchange Act in that he (a) primarily performs, or is intended to primarily
perform at the end of the offering, substantial duties for or on behalf of the
Issuer otherwise than in connection with transactions in securities; and (b) is
not a broker-dealer, or an associated person of a broker-dealer, within the
preceding twelve (12) months; and (c) does not participate in selling and
offering of securities for any Issuer more than once every twelve (12) months
other than in reliance on paragraphs (a)(4)(i) or (a) (4) (iii) of the Exchange
Act.
Mr. Nagy is not subject to disqualification, is not being compensated, and is
not associated with a broker-dealer. Mr. Nagy is and will continue to be one of
our officers and directors at the end of the offering and, during the last
twelve months, he has not been and is not currently a broker-dealer nor
associated with a broker-dealer. Mr. Nagy has not, during the last twelve
months, and will not, during the next twelve months, offer or sell securities
for another corporation other than in reliance on paragraphs (a)(4)(i) or (a)
(4) (iii) of the Exchange Act.
There is currently no trading market for our common stock, and there can be no
assurance that any trading market will develop in the future.
PENNY STOCK REGULATION
The Securities Exchange Commission has adopted rules that regulate broker-dealer
practices in connection with transactions in penny stocks. Penny stocks are
generally equity securities with a price of less than $5.00 (other than
securities registered on certain national securities exchanges or quoted on the
NASDAQ system, provided that current price and volume information with respect
to transactions in such securities is provided by the exchange or system).
The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, to deliver a standardized risk
disclosure document prepared by the Commission, that:
contains a description of the nature and level of risk in the market for
penny stocks in both public offerings and secondary trading;
contains a description of the broker's or dealer's duties to the customer
and of the rights and remedies available to the customer with respect to a
violation of such duties;
contains a brief, clear, narrative description of a dealer market,
including "bid" and "ask" prices for penny stocks and the significance of the
spread between the bid and ask price;
contains a toll-free telephone number for inquiries on disciplinary actions
defines significant terms in the disclosure document or in the conduct of
trading penny stocks; and
contains such other information and is in such form (including language,
type, size, and format) as the Commission shall require by rule or regulation.
The broker-dealer also must provide the customer with the following, prior to
proceeding with any transaction in a penny stock:
bid and offer quotations for the penny stock;
details of the compensation of the broker-dealer and its salesperson in the
transaction;
the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market for
such stock; and
monthly account statements showing the market value of each penny stock
held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a
penny stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
22
These disclosure requirements will have the effect of reducing the trading
activity in the secondary market for our stock because it will be subject to
these penny stock rules. Therefore, stockholders may have difficulty selling
those securities.
TERMS OF SALE OF THE SHARES
We will be selling a maximum of 2,000,000 shares of our common stock on a best
efforts basis. There is no minimum amount of shares that must be sold in this
offering, and we have not established any escrow account to receive subscription
payments. We will have immediate access to the proceeds of this offering. Once
a subscription is accepted, it is irrevocable and cannot be withdrawn by the
subscriber.
We reserve the right to completely or partially accept or reject any
subscription for shares offered in this offering, for any reason or for no
reason.
Any change in the material terms of this offering after the effective date of
this Prospectus will terminate the original offer and will entitle any
subscribers to a refund of their investment. Material changes include the
following: an extension of the offering period beyond the 12 months currently
contemplated; a change in the offering price; and, a change in the application
of proceeds. If there is a change in the material terms of this offering, any
new offering may be made by means of a post-effective amendment.
METHOD OF SUBSCRIBING
Persons may subscribe by filling in and signing the subscription agreement, and
delivering it, prior to the expiration date, to us. The subscription price of
$0.10 per share must be paid in cash, by wire transfer or by check, bank draft
or postal express money order payable in United States dollars to our credit.
EXPIRATION DATE
This offering will remain open until the earlier of the date that all shares
offered in this offering are sold and 12 months after the date of this
prospectus. We may cease our selling efforts at any time for any reason
whatsoever.
DESCRIPTION OF SECURITIES
GENERAL
Our authorized capital stock consists of 100,000,000 shares of common stock at a
par value of $0.0001 per share and 100,000,000 shares of preferred stock at a
par value of $0.0001 per share.
COMMON STOCK
As of the date of this prospectus, there are 8,100,000 issued and outstanding
shares of our common stock held by two stockholders of record. Holders of our
common stock are entitled to one vote for each share on all matters submitted to
a stockholder vote. Holders of common stock do not have cumulative voting
rights. Therefore, holders of a majority of the shares of common stock voting
for the election of directors can elect all of the directors. At all meetings of
shareholders, except where otherwise provided by statute or by the Articles of
Incorporation, or by these Bylaws, the presence, in person or by proxy duly
authorized, of the holder or holders of not less than twenty percent (20%) of
the outstanding shares of stock entitled to vote shall constitute a quorum for
the transaction of business. A vote by the holders of a majority of our
outstanding shares is required to effect certain fundamental corporate changes
such as liquidation, merger or an amendment to our articles of incorporation.
Holders of our common stock are entitled to share in all dividends that the
board of directors, in its discretion, declares from legally available funds. In
the event of liquidation, dissolution or winding up, each outstanding share
entitles its holder to participate pro rata in all assets that remain after
payment of liabilities and after providing for each class of stock, if any,
having preference over the common stock.
Holders of our common stock have no pre-emptive rights, no conversion rights and
there are no redemption provisions applicable to our common stock.
PREFERRED STOCK
We have authorized 100,000,000 shares of preferred stock at a par value of
$0.0001 per share. We have no shares of preferred stock outstanding as of the
date of this prospectus.
23
DIVIDEND POLICY
We have not declared or paid any cash dividends on our common stock. We
currently intend to retain future earnings, if any, to finance the expansion of
our business. As a result, we do not anticipate paying any cash dividends in the
foreseeable future.
SHARE PURCHASE WARRANTS
We have not issued and do not have outstanding any warrants to purchase shares
of our common stock.
OPTIONS
We have not issued and do not have outstanding any options to purchase shares of
our common stock.
CONVERTIBLE SECURITIES
We have not issued and do not have outstanding any securities convertible into
shares of our common stock or any rights convertible or exchangeable into shares
of our common stock.
NEVADA ANTI-TAKEOVER LAWS
The Nevada Revised Statutes Sections 78.378 through 78.3793, under certain
circumstances, place restrictions upon the acquisition of a controlling interest
in a Nevada corporation, including the potential requirements of shareholder
approval and the granting of dissenters' rights in connection with such an
acquisition. These provisions could have the effect of delaying or preventing a
change in control of our company.
TRANSFER AGENT
Our transfer agent and registrar is Holladay Stock Transfer, Inc., located at
2939 North 67th Place, Scottsdale, Arizona, 85251, telephone (480) 481-3940.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
Our directors and officers are indemnified as provided by the Nevada Revised
Statutes, our Articles of Incorporation and our Bylaws. Insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to our directors, officers and controlling persons pursuant to our
Articles of Incorporation or provisions of the Nevada Business Corporations Act,
or otherwise, we have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by us
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, we will, unless in the opinion of counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question, whether or not such indemnification by us is against public policy
as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
LEGAL MATTERS
The validity of the shares of common stock offered by us was passed upon by
Conrad C. Lysiak, Attorney and Counselor at Law in Spokane, Washington.
EXPERTS
Our financial statements as of August 31, 2007 appearing in this Prospectus and
Registration Statement have been audited by Vellmer & Chang, Chartered
Accountants, an independent registered public accounting firm and are included
in reliance upon the report therein included, given on the authority of such
firm as experts in auditing and accounting.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
In September 2007, we engaged the services of Vellmer & Chang, Chartered
Accountants, of Vancouver, British Columbia, to provide an audit of our
financial statements for the period from August 30, 2007 (inception) to August
31, 2007. This is our first auditor. We have no disagreements with our auditor
through the date of this prospectus.
24
AVAILABLE INFORMATION
We have filed a registration statement on Form SB-2 under the Securities Act of
1933 with the Securities and Exchange Commission with respect to the shares of
our common stock offered through this prospectus. This prospectus is filed as
apart of that registration statement and does not contain all of the information
contained in the registration statement and exhibits. For a more complete
description of matters involving us, please refer to our registration statement
and each exhibit attached to it. Anyone may inspect the registration statement
and exhibits and schedules filed with the Securities and Exchange Commission at
the Commission's principal office in Washington, D.C. Copies of all or any part
of the registration statement may be obtained from the Public Reference Section
of the Securities and Exchange Commission, 100 F Street, NE, Washington, D.C.
20549. Please call the Commission at 1-800-SEC-0330 for further information on
the operation of the public reference rooms. The Securities and Exchange
Commission also maintains a web site at http://www.sec.gov that contains
reports, proxy statements and information regarding registrants that file
electronically with the Commission. In addition, we will file electronic
versions of our annual and quarterly reports on the Commission's Electronic Data
Gathering Analysis and Retrieval, or EDGAR System. Our registration statement
and the referenced exhibits can also be found on this site as well as our
quarterly and annual reports. We will not send the annual report to our
shareholders unless requested by the individual shareholders.
25
INDEX TO FINANCIAL STATEMENTS
GIDDY-UP PRODUCTIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
Pages
FINANCIAL STATEMENTS FOR THE THREE MONTH PERIOD ENDED NOVEMBER 30, 2007
(UNAUDITED)
Balance Sheets F-2
Statements of Stockholders' Equity (Deficiency) F-3
Statements of Operations F-4
Statements of Cash Flows F-5
Notes to Financial Statements F-6 thru F-9
FINANCIAL STATEMENTS FOR THE PERIOD FROM INCEPTION (AUGUST 30, 2007)
TO AUGUST 31, 2007
Report of Independent Registered Public Accounting Firm F-10
Balance Sheet F-11
Statement of Stockholders Equity F-12
Statement of Operations and Deficit F-13
Statement of Cash Flows F-14
Notes to Financial Statements F-15 thru F-18
F-1
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Balance Sheets
November 30, 2007
(Unaudited - Prepared by Management)
(EXPRESSED IN U.S. DOLLARS)
-----------------------------------------------------------------------------------------------
November 30, 2007 August 31, 2007
-----------------------------------------------------------------------------------------------
ASSETS
CURRENT
Cash $ 10,135 $
Prepaid expense 6,637 20,000
-----------------------------------------------------------------------------------------------
CURRENT ASSETS 16,772 20,000
FILM PROPERTY (Note 3) 10,813 10,813
-----------------------------------------------------------------------------------------------
TOTAL ASSETS $ 27,585 $ 30,813
===============================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT
Promissory note - related party $ 10,000 $ -
Accounts payable and accrued liabilities 4,876 1,055
Due to a director 27,587 20,000
-----------------------------------------------------------------------------------------------
TOTAL LIABILITIES 42,463 21,055
-----------------------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY (DEFICIENCY)
SHARE CAPITAL
Authorized:
100,000,000 preferred shares, par value $0.0001
100,000,000 common shares, par value $0.0001
Issued and outstanding:
Nil preferred shares
8,100,000 common shares 810 800
ADDITIONAL PAID-IN CAPITAL 10,503 10,013
(DEFICIT) ACCUMULATED DURING THE DEVELOPMENT STAGE (26,191) (1,055)
-----------------------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIENCY) (14,878) 9,758
-----------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY) $ 27,585 $ 30,813
===============================================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-2
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statements of Stockholders' Equity (Deficiency)
For the period from August 30, 2007 (inception) to November 30, 2007
(Unaudited - Prepared by Management)
(EXPRESSED IN U.S. DOLLARS)
--------------------------------------------------------------------------------------------------------------
(Deficit)
accumulated
during Total
Preferred stock Common stock Additional development stockholders'
Shares Amount Shares Amount paid-in capital stage deficiency
--------------------------------------------------------------------------------------------------------------
Issuance of common stock
for settlement of debt
August 31, 2007,
0.005 per share - $ - 8,000,000 $ 800 $ 39,200 $ - $ 40,000
Film property transferred
from a shareholder - - - - (29,187) - (29,187)
Comprehensive income (loss)
Loss for the period - - - - - (1,055) (1,055)
-------------------------------------------------------------------------------------------------------------
Balance, August 31, 2007 - $ - 8,000,000 $ 800 $ 10,013 $ (1,055) $ 9,758
-------------------------------------------------------------------------------------------------------------
Issuance of common stock
for settlement of debt
September 8, 2007,
$0.005 per share - $ - 100,000 $ 10 $ 490 $ - $ 500
Comprehensive income (loss)
Loss for the period - - - - - (25,136) (25,136)
-------------------------------------------------------------------------------------------------------------
Balance, November 30, 2007 - $ - 8,100,000 $ 810 $ 10,503 $ (26,191) $ (14,878)
=============================================================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-3
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statements of Operations
(Unaudited - Prepared by Management)
(EXPRESSED IN U.S. DOLLARS)
---------------------------------------------------------------------------
August 30, 2007 Three months
(inception) to ended
November 30, 2007 November 30, 2007
---------------------------------------------------------------------------
GENERAL AND ADMINISTRATIVE EXPENSES
Accounting 4,876 4,876
Consulting 10,000 10,000
Marketing 41 41
Legal 1,055 -
Office expenses 219 219
---------------------------------------------------------------------------
OPERATING LOSS 26,191 25,136
---------------------------------------------------------------------------
NET LOSS FOR THE PERIOD $ (26,191) $ (25,136)
BASIC AND DILUTED LOSS PER SHARE $ (0.00) $ (0.00)
===========================================================================
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
- basic and diluted - 8,091,209
===========================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-4
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statements of Cash Flows
(Unaudited - Prepared by Management)
(EXPRESSED IN U.S. DOLLARS)
------------------------------------------------------------------------------------
August 30, 2007 Three months
(inception) to ended
November 30, 2007 November 30, 2007
------------------------------------------------------------------------------------
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES
Loss for the period $ (26,191) $ (25,136)
Changes in non-cash working capital items:
- (increase) in pre-paid expense (6,637) 13,363
- accounts payable and accrued liabilities 4,876 3,821
------------------------------------------------------------------------------------
NET CASH USED IN OPERATING ACTIVITIES (27,952) (7,952)
------------------------------------------------------------------------------------
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES
Proceeds from promissory note 10,000 10,000
Due to a director 28,087 8,087
------------------------------------------------------------------------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 38,087 18,087
------------------------------------------------------------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS 10,135 10,135
CASH AND CASH EQUIVALENTS, beginning of period - -
------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, end of period $ 10,135 $ 10,135
====================================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-5
1. INCORPORATION AND CONTINUANCE OF OPERATIONS
Giddy-up Productions, Inc. was formed on August 30, 2007 under the laws of the
State of Nevada. We have not commenced our planned principal operations,
producing motion pictures. We are considered a development stage company as
defined in SFAS No. 7. We have an office in Calgary, Alberta. The Company's
fiscal year end is August 31.
These financial statements have been prepared in accordance with generally
accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and the satisfaction of liabilities and commitments in
the normal course of business. We have incurred operating losses and require
additional funds to maintain our operations. Management's plans in this regard
are to raise equity financing as required.
These conditions raise substantial doubt about our ability to continue as a
going concern. These financial statements do not include any adjustments that
might result from this uncertainty.
We have not generated any operating revenues to date.
2. SIGNIFICANT ACCOUNTING POLICIES
(a) Cash and Cash Equivalents
Cash equivalents comprise certain highly liquid instruments with a maturity of
three months or less when purchased. As of November 30, 2007 we did not have
any cash or cash equivalents.
(b) Accounting Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates and assumptions.
(c) Advertising Expenses
We expense advertising costs as incurred. We did not incur any advertising
expense during the period ended November 30, 2007.
(d) Loss Per Share
Loss per share is computed using the weighted average number of shares
outstanding during the period. We have adopted SFAS No. 128, "Earnings Per
Share". Diluted loss per share is equivalent to basic loss per share.
(e) Concentration of Credit Risk
We place our cash and cash equivalents with high credit quality financial
institutions. As of November 30, 2007, we had no balance in a bank and $nil
beyond insured limits.
(f) Foreign Currency Transactions
We are located and operating outside of the United States of America. We
maintain our accounting records in U.S. Dollars, as follows:
At the transaction date, each asset, liability, revenue and expense is
translated into U.S. dollars by the use of the exchange rate in effect at that
date. At the period end, monetary assets and liabilities are remeasured by
using the exchange rate in effect at that date. The resulting foreign exchange
gains and losses are included in operations.
F-6
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
(g) Fair Value of Financial Instruments
The respective carrying value of certain on-balance-sheet financial instruments
approximated their fair value. These financial instruments include a promissory
note, accounts payable and accrued liabilities, and amounts due to a director.
Fair values were assumed to approximate carrying values for these financial
instruments, except where noted, since they are short term in nature and their
carrying amounts approximate fair values or they are payable on demand.
Management is of the opinion that we are not exposed to significant interest or
credit risks arising from these financial instruments. We operate outside the
United States of America and have significant exposure to foreign currency risk
due to the fluctuation of currency in which we operate.
(h) Income Taxes
We have adopted Statement of Financial Accounting Standards No. 109 (SFAS 109),
Accounting for Income Taxes, which requires us to recognize deferred tax
liabilities and assets for the expected future tax consequences of events that
have been recognized in our financial statements or tax returns using the
liability method. Under this method, deferred tax liabilities and assets are
determined based on the temporary differences between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect in the
years in which the differences are expected to reverse.
(i) Stock-Based Compensation
The Company adopted SFAS No. 123(revised), "Share-Based Payment", to account for
its stock options and similar equity instruments issued. Accordingly,
compensation costs attributable to stock options or similar equity instruments
granted are measured at the fair value at the grant date, and expensed over the
expected vesting period. SFAS No. 123(revised) requires excess tax benefits be
reported as a financing cash inflow rather than as a reduction of taxes paid.
We did not grant any stock options during the period ended November 30, 2007.
(j) Comprehensive Income
We adopted Statement of Financial Accounting Standards No. 130 (SFAS 130),
Reporting Comprehensive Income, which establishes standards for reporting and
display of comprehensive income, its components and accumulated balances. We
are disclosing this information on our Statement of Stockholders' Equity.
Comprehensive income comprises equity except those resulting from investments by
owners and distributions to owners. We have no elements of "other comprehensive
income" for the period ended November 30, 2007.
(k) Film property and screenplay rights
The Company capitalized costs it incurs to buy film or transcripts that will
later be marketed or be used in the production of films according to the
guidelines in SOP 00-02. The Company will begin amortization of capitalized
film cost when a film is released and it begins to recognize revenue from the
film.
F-7
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
(l) Accounting for Derivative Instruments and Hedging Activities
We have adopted Statement of Financial Accounting Standards No. 133 (SFAS 133)
Accounting for Derivative and Hedging Activities, which requires companies to
recognize all derivative contracts as either assets or liabilities in the
balance sheet and to measure them at fair value. If certain conditions are met,
a derivative may be specifically designated as a hedge, the objective of which
is to match the timing of gain and loss recognition on the hedging derivative
with the recognition of (i) the changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk or (ii) the earnings effect
of the hedged forecasted transaction. For a derivative not designated as a
hedging instrument, the gain or loss is recognized in income in the period of
change.
We have not entered into derivative contracts either to hedge existing risks or
for speculative purposes.
(m) Long-Lived Assets Impairment
Our long-term assets are reviewed when changes in circumstances require as to
whether their carrying value has become impaired, pursuant to guidance
established in Statement of Financial Accounting Standards No. 144 (SFAS 144),
Accounting for the Impairment or Disposal of Long-Lived Assets. Management
considers assets to be impaired if the carrying value exceeds the future
projected cash flows from the related operations (undiscounted and without
interest charges). If impairment is deemed to exist, the assets will be written
down to fair value.
(n) New Accounting Pronouncements
In June 2006, FASB issued FASB Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109",
which prescribes a recognition threshold and measurement attribute for the
financial statement recognition and measurement of a tax position taken or
expected to be taken in a tax return. FIN 48 also provides guidance on
de-recognition, classification, interest and penalties, accounting in interim
periods, disclosure and transition. FIN 48 is effective for fiscal years
beginning after December 15, 2006. The Company does not expect the adoption of
FIN 48 to have a material effect on its financial condition or results of
operations.
In September 2006, FASB issued SFAS No. 157, "Fair Value Measurements" which
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. Where applicable, SFAS No. 157 simplifies and codifies
related guidance within GAAP and does not require any new fair value
measurements. SFAS No. 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007, and interim periods within those
fiscal years. Earlier adoption is encouraged. The Company does not expect the
adoption of SFAS No. 157 to have a material effect on its financial condition or
results of operations.
In September 2006, the SEC announced Staff Accounting Bulletin No. 108 ("SAB
108"). SAB 108 addresses how to quantify financial statement errors that arose
in prior periods for purposes of assessing their materiality in the current
period. It requires analysis of misstatements using both an income statement
(rollover) approach and a balance sheet (iron curtain) approach in assessing
materiality. It clarifies that immaterial financial statement errors in a prior
SEC filing can be corrected in subsequent filings without the need to amend the
prior filing. In addition, SAB 108 provides transitional relief for correcting
errors that would have been considered immaterial before its issuance. The
Company does not expect the adoption of SAB 108 to have a material effect on its
financial condition or results of operations.
In February 2007, the FASB issued SFAS No. 159, "The fair value Option for
Financial Assets and Financial Liabilities - Including an Amendment of FASB
Statement No. 115". This statements objective is to improve financial reporting
by providing the Company with the opportunity to mitigate volatility in reported
earnings caused by measuring related assets and liabilities differently without
having to apply complex hedge accounting provisions. This statement is expected
to expand the use of fair value measurement, which is consistent with the FASB's
long-term measurement objective for accounting for financial instruments. The
adoption of SFAS 159 did not have an impact on the Company's financial
statements. The Company presently comments on significant accounting policies
(including fair value of financial instruments) in Note 2 to the financial
statements.
F-8
3. FILM PROPERTY
On August 30, 2007, we entered into a purchase agreement with our President to
acquire all right, title and interest in and to a motion picture titled "Not
That Kind of Girl" for total cash consideration of $40,000. On August 31, 2007,
our President agreed to accept 8,000,000 shares of our common stock in full and
final satisfaction of the $40,000 debtIn accordance with SEC Staff Accounting
Bullentin 5G "Transfers of Non-monetary Assets by Promoters or shareholders",
provided that transfer of non-monetary assets to a company by its promoters or
shareholders in exchange for stock prior to or at the time of the Company's
initial public offering normally should be recorded at the transferor's
historical cost basis determined under GAAP. Pursuant to SEC Staff Accounting
Bulletin 5G, the Company has recorded the film property at its estimated
original cost of $10,813 by crediting the film property with $29,187 and
debiting the additional paid-in capital with $29,187
4. PROMISSORY NOTE
On November 12, 2007, we issued an unsecured promissory note in the amount of
$10,000 to our President. The promissory note accrues interest at the rate of
five per cent per year and is due and payable on demand.
5. PREFERRED AND COMMON STOCK
We have 100,000,000 shares of preferred stock authorized at par value of $0.0001
per share and none issued.
We have 100,000,000 shares of common stock authorized at par value of $0.0001
per share. All shares of stock are non-assessable and non-cumulative, with no
preemptive rights.
On August 31, 2007, the Company issued 8,000,000 restricted shares of common
stock for the settlement of $40,000 in debt owed to the president of the
Company. (See note 3)
On September 8, 2007, we issued 100,000 restricted shares of common stock at
$0.005 per share to a director of the Company for the settlement of $500 in
debt.
6. RELATED PARTY TRANSACTIONS AND COMMITMENTS
Please see note 3, note 4 and note 5.
7. COMMITMENTS
The Company entered into a Website design and service agreement with a Website
Developer which the Website Developer agreed to provide design, development and
integration of a website infrastructure and interface for the Company with a
consideration of CAD $18,550. As at November 30, 2007, the Company has advanced
$6,637 (CAD $7,000) to the Website Developer, which has been included in prepaid
expenses.
F-9
VELLMER & CHANG
CHARTERED ACCOUNTANTS *
505 - 815 Hornby Street
Vancouver, B.C, V6Z 2E6
Tel: 604-687-3776
Fax: 604-687-3778
E-mail: info@vellmerchang.com
* denotes a firm of incorporated professionals
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Giddy-up Productions, Inc.
(A development stage company)
We have audited the accompanying balance sheet of Giddy-up Productions, Inc. (a
development stage company) as at August 31, 2007 and the related statements of
stockholders' equity, operations and cash flows for the period from August 30,
2007 (date of inception) to August 31, 2007. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform an audit to obtain reasonable assurance whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company as at August 31,
2007 and the results of its operations and its cash flows for the period from
August 30, 2007 (date of inception) to August 31, 2007, in conformity with
accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 1 to the financial
statements, the Company incurred losses from operations since inception, has not
attained profitable operations and is dependent upon obtaining adequate
financing to fulfill its operation activities. These factors raise substantial
doubt about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are also discussed in Note 1. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Vancouver, Canada "VELLMER & CHANG"
November 17, 2007 Chartered Accountants
F-10
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Balance Sheet
August 31, 2007
(EXPRESSED IN U.S. DOLLARS)
----------------------------------------------------------------------
August 31, 2007
----------------------------------------------------------------------
ASSETS
CURRENT
Prepaid expense $ 20,000
FILM PROPERTY (Note 3) 10,813
----------------------------------------------------------------------
TOTAL ASSETS $ 30,813
======================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT
Accounts payable and accrued liabilities $ 1,055
Due to a director 20,000
----------------------------------------------------------------------
TOTAL LIABILITIES 21,055
----------------------------------------------------------------------
STOCKHOLDERS' EQUITY
SHARE CAPITAL
Authorized:
100,000,000 preferred shares, par value $0.0001
100,000,000 common shares, par value $0.0001
Issued and outstanding:
Nil preferred shares
8,000,000 common shares 800
ADDITIONAL PAID-IN CAPITAL 10,813
(DEFICIT) ACCUMULATED DURING THE DEVELOPMENT STAGE (1,055)
----------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY 9,758
----------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 30,813
======================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-11
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statement of Stockholders' Equity
For the period from August 30, 2007 (inception) to August 31, 2007
(EXPRESSED IN U.S. DOLLARS)
----------------------------------------------------------------------------------------------------------------------------
(Deficit)
accumulated
Additional during Total
Preferred stock Common stock paid-in development stockholder's
Shares Amount Shares Amount capital stage deficiency
----------------------------------------------------------------------------------------------------------------------------
Issuance of common stock for settlement of debt
August 31, 2007, $0.005 per share - $ - 8,000,000 $ 800 $ 39,200 $ - $ 40,000
Film property transferred from a shareholder - - - - (29,187) - (29,187)
Comprehensive income (loss)
Loss for the period - - - - - (1,055) (1,055)
----------------------------------------------------------------------------------------------------------------------------
Balance, August 31, 2007 - $ - 8,000,000 $ 800 $ 10,013 $ (1,055) $ 9,758
============================================================================================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-12
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statement of Operations
(EXPRESSED IN U.S. DOLLARS)
----------------------------------------------------
August 30, 2007
(inception) to
August 31, 2007
----------------------------------------------------
GENERAL AND ADMINISTRATIVE EXPENSES
Legal 1,055
----------------------------------------------------
OPERATING LOSS 1,055
----------------------------------------------------
NET LOSS FOR THE PERIOD $ (1,055)
BASIC AND DILUTED LOSS PER SHARE $ (0.00)
====================================================
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
- basic and diluted 4,000,000
====================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-13
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Statement of Cash Flows
(EXPRESSED IN U.S. DOLLARS)
---------------------------------------------------------------
August 30, 2007
(inception) to
August 31, 2007
---------------------------------------------------------------
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES
Loss for the period $ (1,055)
Changes in non-cash working capital items:
- prepaid expense and deposit (20,000)
- accounts payable and accrued liabilities 1,055
---------------------------------------------------------------
(20,000)
---------------------------------------------------------------
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES
Due to a director 20,000
---------------------------------------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS -
CASH AND CASH EQUIVALENTS, beginning of period -
---------------------------------------------------------------
CASH AND CASH EQUIVALENTS, end of period $ -
===============================================================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
F-14
GIDDY-UP PRODUCTIONS, INC.
(A development stage company)
Notes to Financial Statements
August 31, 2007
(EXPRESSED IN U.S. DOLLARS)
1. INCORPORATION AND CONTINUANCE OF OPERATIONS
Giddy-up Productions, Inc. was formed on August 30, 2007 under the laws of the
State of Nevada. We have not commenced our planned principal operations,
producing motion pictures. We are considered a development stage company as
defined in SFAS No. 7. We have an office in Calgary, Alberta. The Company's
fiscal year end is August 31.
These financial statements have been prepared in accordance with generally
accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and the satisfaction of liabilities and commitments in
the normal course of business. We have incurred operating losses and require
additional funds to maintain our operations. Management's plans in this regard
are to raise equity financing as required.
These conditions raise substantial doubt about our ability to continue as a
going concern. These financial statements do not include any adjustments that
might result from this uncertainty.
We have not generated any operating revenues to date.
2. SIGNIFICANT ACCOUNTING POLICIES
(a) Cash and Cash Equivalents
Cash equivalents comprise certain highly liquid instruments with a maturity of
three months or less when purchased. As of August 31, 2007 we did not have any
cash or cash equivalents.
(b) Accounting Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates and assumptions.
(c) Advertising Expenses
We expense advertising costs as incurred. We did not incur any advertising
expense during the period ended August 31, 2007.
(d) Loss Per Share
Loss per share is computed using the weighted average number of shares
outstanding during the period. We have adopted SFAS No. 128, "Earnings Per
Share". Diluted loss per share is equivalent to basic loss per share.
(e) Concentration of Credit Risk
We place our cash and cash equivalents with high credit quality financial
institutions. As of August 31, 2007, we had no balance in a bank and $nil
beyond insured limits.
(f) Foreign Currency Transactions
We are located and operating outside of the United States of America. We
maintain our accounting records in U.S. Dollars, as follows:
At the transaction date, each asset, liability, revenue and expense is
translated into U.S. dollars by the use of the exchange rate in effect at that
date. At the period end, monetary assets and liabilities are remeasured by
using the exchange rate in effect at that date. The resulting foreign exchange
gains and losses are included in operations.
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2. SIGNIFICANT ACCOUNTING POLICIES (continued)
(g) Fair Value of Financial Instruments
The respective carrying value of certain on-balance-sheet financial instruments
approximated their fair value. These financial instruments include accounts
payable and accrued liabilities. Fair values were assumed to approximate
carrying values for these financial instruments, except where noted, since they
are short term in nature and their carrying amounts approximate fair values or
they are payable on demand. Management is of the opinion that we are not
exposed to significant interest or credit risks arising from these financial
instruments. We operate outside the United States of America and have
significant exposure to foreign currency risk due to the fluctuation of currency
in which the we operate.
(h) Income Taxes
We have adopted Statement of Financial Accounting Standards No. 109 (SFAS 109),
Accounting for Income Taxes, which requires us to recognize deferred tax
liabilities and assets for the expected future tax consequences of events that
have been recognized in our financial statements or tax returns using the
liability method. Under this method, deferred tax liabilities and assets are
determined based on the temporary differences between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect in the
years in which the differences are expected to reverse.
(i) Stock-Based Compensation
The Company adopted SFAS No. 123(revised), "Share-Based Payment", to account for
its stock options and similar equity instruments issued. Accordingly,
compensation costs attributable to stock options or similar equity instruments
granted are measured at the fair value at the grant date, and expensed over the
expected vesting period. SFAS No. 123(revised) requires excess tax benefits be
reported as a financing cash inflow rather than as a reduction of taxes paid.
We did not grant any stock options during the year ended August 31, 2007.
(j) Comprehensive Income
We adopted Statement of Financial Accounting Standards No. 130 (SFAS 130),
Reporting Comprehensive Income, which establishes standards for reporting and
display of comprehensive income, its components and accumulated balances. We
are disclosing this information on our Statement of Stockholders' Equity.
Comprehensive income comprises equity except those resulting from investments by
owners and distributions to owners. We have no elements of "other comprehensive
income" for the period ended August 31, 2007.
(k) Film property and screenplay rights
The Company capitalized costs it incurs to buy film or transcripts that will
later be marketed or be used in the production of films according to the
guidelines in SOP 00-02. The Company will begin amortization of capitalized
film cost when a film is released and it begins to recognize revenue from the
film.
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2. SIGNIFICANT ACCOUNTING POLICIES (continued)
(l) Accounting for Derivative Instruments and Hedging Activities
We have adopted Statement of Financial Accounting Standards No. 133 (SFAS 133)
Accounting for Derivative and Hedging Activities, which requires companies to
recognize all derivative contracts as either assets or liabilities in the
balance sheet and to measure them at fair value. If certain conditions are met,
a derivative may be specifically designated as a hedge, the objective of which
is to match the timing of gain and loss recognition on the hedging derivative
with the recognition of (i) the changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk or (ii) the earnings effect
of the hedged forecasted transaction. For a derivative not designated as a
hedging instrument, the gain or loss is recognized in income in the period of
change.
We have not entered into derivative contracts either to hedge existing risks or
for speculative purposes.
(m) Long-Lived Assets Impairment
Our long-term assets are reviewed when changes in circumstances require as to
whether their carrying value has become impaired, pursuant to guidance
established in Statement of Financial Accounting Standards No. 144 (SFAS 144),
Accounting for the Impairment or Disposal of Long-Lived Assets. Management
considers assets to be impaired if the carrying value exceeds the future
projected cash flows from the related operations (undiscounted and without
interest charges). If impairment is deemed to exist, the assets will be written
down to fair value.
(n) New Accounting Pronouncements
In June 2006, FASB issued FASB Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109",
which prescribes a recognition threshold and measurement attribute for the
financial statement recognition and measurement of a tax position taken or
expected to be taken in a tax return. FIN 48 also provides guidance on
de-recognition, classification, interest and penalties, accounting in interim
periods, disclosure and transition. FIN 48 is effective for fiscal years
beginning after December 15, 2006. The Company does not expect the adoption of
FIN 48 to have a material effect on its financial condition or results of
operations.
In September 2006, FASB issued SFAS No. 157, "Fair Value Measurements" which
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. Where applicable, SFAS No. 157 simplifies and codifies
related guidance within GAAP and does not require any new fair value
measurements. SFAS No. 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007, and interim periods within those
fiscal years. Earlier adoption is encouraged. The Company does not expect the
adoption of SFAS No. 157 to have a material effect on its financial condition or
results of operations.
In September 2006, the SEC announced Staff Accounting Bulletin No. 108 ("SAB
108"). SAB 108 addresses how to quantify financial statement errors that arose
in prior periods for purposes of assessing their materiality in the current
period. It requires analysis of misstatements using both an income statement
(rollover) approach and a balance sheet (iron curtain) approach in assessing
materiality. It clarifies that immaterial financial statement errors in a prior
SEC filing can be corrected in subsequent filings without the need to amend the
prior filing. In addition, SAB 108 provides transitional relief for correcting
errors that would have been considered immaterial before its issuance. The
Company does not expect the adoption of SAB 108 to have a material effect on its
financial condition or results of operations.
In February 2007, the FASB issued SFAS No. 159, "The fair value Option for
Financial Assets and Financial Liabilities - Including an Amendment of FASB
Statement N". This statements objective is to improve financial reporting
by providing the Company with the opportunity to mitigate volatility in reported
earnings caused by measuring related assets and liabilities differently without
having to apply complex hedge accounting provisions. This statement is expected
to expand the use of fair value measurement, which is consistent with the FASB's
long-term measurement objective for accounting for financial instruments. The
adoption of SFAS 159 did not have an impact on the Company's financial
statements. The Company presently comments on significant accounting policies
(including fair value of financial instruments) in Note 2 to the financial
statements.
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3. FILM PROPERTY
On August 30, 2007, we entered into a purchase agreement with our President to
acquire all right, title and interest in and to a motion picture titled "Not
That Kind of Girl" for total cash consideration of $40,000. On August 31, 2007,
our President agreed to accept 8,000,000 shares of our common stock in full and
final satisfaction of the $40,000 debtIn accordance with SEC Staff Accounting
Bullentin 5G "Transfers of Non-monetary Assets by Promoters or shareholders",
provided that transfer of non-monetary assets to a company by its promoters or
shareholders in exchange for stock prior to or at the time of the Company's
initial public offering normally should be recorded at the transferor's
historical cost basis determined under GAAP. Pursuant to SEC Staff Accounting
Bulletin 5G, the Company has recorded the film property at its estimated
original cost of $10,813 by crediting the film property with $29,187 and
debiting the additional paid-in capital with $29,187
4. PREFERRED AND COMMON STOCK
We have 100,000,000 shares of preferred stock authorized at par value of $0.0001
per share and none issued.
We have 100,000,000 shares of common stock authorized at par value of $0.0001
per share. All shares of stock are non-assessable and non-cumulative, with no
preemptive rights.
On August 31, 2007, the Company issued 8,000,000 common stocks for the debt
settlement of $40,000 owed to the president of the Company. (See note 3)
5. RELATED PARTY TRANSACTIONS AND COMMITMENTS
Please see note 3, note 4 and note 8.
6. INCOME TAXES
At August 31, 2007, we had deferred tax assets of approximately $360 principally
arising from net operating loss carryforwards for income tax purposes. As our
management cannot determine that it is more likely than not that we will realize
the benefit of the deferred tax asset, a valuation allowance equal to the
deferred tax asset has been established at August 31, 2007. The significant
components of the deferred tax asset at August 31, 2007 were as follows:
o. 115 August 31, 2007
Net operating loss carryforwards $ 360
Valuation allowance (360)
Net deferred tax asset $ -
At August 31, 2007, we had net operating loss carryforwards of approximately
$1,055, which expire in the year 2027.
7. COMMITMENTS
The Company entered into a Website design and service agreement with a Website
Developer which the Website Developer agreed to provide design, development and
integration of a website infrastructure and interface for the Company with a
consideration of CAD $18,550. Subsequent to the year end, the Company had
advanced CAD$7,000 to the Website Developer.
8. SUBSEQUENT EVENTS
On September 8, 2007, we issued 100,000 restricted common stock at $0.005 per
share to a director of the Company for the settlement of debt $500.
On November 12, 2007, we issued an unsecured promissory note in the amount of
$10,000 to our President. The promissory note accrues interest at the rate of
five per cent per year and is due and payable on demand. Proceeds of the note
were used to pay for startup costs, accounting fees, and miscellaneous expenses.
See Note 7.
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2,000,000 SHARES
GIDDY-UP PRODUCTIONS INC.
COMMON STOCK
PROSPECTUS
We have not authorized any dealer, salesperson or other person to give anyone
written information other than this prospectus or to make representations as to
matters not stated in this prospectus. Prospective investors must not rely on
unauthorized information. This prospectus is not an offer to sell these
securities or a solicitation of an offer to buy the securities in any
jurisdiction where that would not be permitted or legal. Neither the delivery
of this prospectus nor any sales made hereunder after the date of this
prospectus shall create an implication that either the information contained
herein or the affairs of Giddy-up Productions, Inc. have not changed since the
date hereof.
Until _________, 2008, a period of 90 days after the date of this prospectus,
all dealers that buy, sell or trade in our securities, whether or not
participating in this offering, may be required to deliver a prospectus. This
requirement is in addition to the dealers' obligation to deliver a prospectus
when acting as an underwriter with respect to its unsold allotment or
subscription.
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Nevada law provides for discretionary indemnification for each person who serves
as one of our directors or officers. We may indemnify such individuals against
all costs, expenses and liabilities incurred in a threatened, pending or
completed action, suit or proceeding brought because such individual is one of
our officers or directors. Such individual must have conducted himself in good
faith and reasonably believed that his conduct was in, or not opposed to, our
best interests. In a criminal action, he must not have had a reasonable cause
to believe his conduct was unlawful.
Article Twelfth of our Articles of Incorporation states that no director or
officer of the Corporation shall be personally liable to the Corporation or any
of its stockholders for damages for breach of fiduciary duty as a director or
officer involving any act or omission of any such director or officer; provided,
however, that the foregoing provision shall not eliminate or limit the liability
of a director or officer (i) for acts or omissions which involve intentional
misconduct, fraud or a knowing violation of law, or (ii) the payment of
dividends in violation of Section 78.300 of the Nevada Revised Statutes. Any
repeal or modification of this Article by the stockholders of the Corporation
shall be prospective only, and shall not adversely affect any limitation on the
personal liability of a director or officer of the Corporation for acts or
omissions prior to such repeal or modification.
Under Article IX, our bylaws provide the following indemnification:
01. INDEMNIFICATION
The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
Corporation) by reason of the fact that such person is or was a Director,
Trustee, Officer, employee or agent of the Corporation, or is or was serving at
the request of the Corporation as a Director, Trustee, Officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgment, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding if such person acted in good
faith and in a manner such person reasonably believed to be in or not opposed to
the best interests of the Corporation, and with respect to any criminal action
or proceeding, had no reasonable cause to believe such person's conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which such person reasonably believed to be in or not
opposed to the best interests of the Corporation, and with respect to any
criminal action proceeding, had reasonable cause to believe that such person's
conduct was unlawful.
02. DERIVATIVE ACTION
The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a judgment in the
Corporation's favor by reason of the fact that such person is or was a Director,
Trustee, Officer, employee or agent of the Corporation, or is or was serving at
the request of the Corporation as a Director, Trustee, Officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorney's fees) and amount paid in
settlement actually and reasonably incurred by such person in connection with
the defense or settlement of such action or suit if such person acted in good
faith and in a manner such person reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to amounts paid in
settlement, the settlement of the suit or action was in the best interests of
the Corporation; provided, however, that no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable for gross negligence or willful misconduct in the
performance of such person's duty to the Corporation unless and only to the
extent that, the court in which such action or suit was brought shall determine
upon application that, despite circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses as such court shall deem
proper. The termination of any action or suit by judgment or settlement shall
not, of itself, create a presumption that the person did not act in good faith
and in a manner which such person reasonably believed to be in or not opposed to
the best interests of the Corporation.
03. SUCCESSFUL DEFENSE
To the extent that a Director, Trustee, Officer, employee or Agent of the
Corporation has been successful on the merits or otherwise, in whole or in part
in defense of any action, suit or proceeding referred to in Paragraphs .01 and
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..02 above, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith.
04. AUTHORIZATION
Any indemnification under Paragraphs .01 and .02 above (unless ordered by a
court) shall be made by the Corporation only as authorized in the specific case
upon a determination that indemnification of the Director, Trustee, Officer,
employee or agent is proper in the circumstances because such person has met the
applicable standard of conduct set forth in Paragraphs .01 and .02 above. Such
determination shall be made (a) by the Board of Directors of the Corporation by
a majority vote of a quorum consisting of Directors who were not parties to such
action, suit or proceeding, or (b) is such a quorum is not obtainable, by a
majority vote of the Directors who were not parties to such action, suit or
proceeding, or (c) by independent legal counsel (selected by one or more of the
Directors, whether or not a quorum and whether or not disinterested) in a
written opinion, or (d) by the Shareholders. Anyone making such a determination
under this Paragraph .04 may determine that a person has met the standards
therein set forth as to some claims, issues or matters but not as to others, and
may reasonably prorate amounts to be paid as indemnification.
05. ADVANCES
Expenses incurred in defending civil or criminal action, suit or proceeding
shall be paid by the Corporation, at any time or from time to time in advance of
the final disposition of such action, suit or proceeding as authorized in the
manner provided in Paragraph .04 above upon receipt of an undertaking by or on
behalf of the Director, Trustee, Officer, employee or agent to repay such amount
unless it shall ultimately be by the Corporation is authorized in this Section.
06. NONEXCLUSIVITY
The indemnification provided in this Section shall not be deemed exclusive of
any other rights to which those indemnified may be entitled under any law,
bylaw, agreement, vote of shareholders or disinterested Directors or otherwise,
both as to action in such person's official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who has
ceased to be a Director, Trustee, Officer, employee or agent and shall inure to
the benefit of the heirs, executors, and administrators of such a person.
07. INSURANCE
The Corporation shall have the power to purchase and maintain insurance on
behalf of any person who is or was a Director, Trustee, Officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a Director, Trustee, Officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against any liability
assessed against such person in any such capacity or arising out of such
person's status as such, whether or not the corporation would have the power to
indemnify such person against such liability.
08. "CORPORATION" DEFINED
For purposes of this Section, references to the "Corporation" shall include, in
addition to the Corporation, an constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had the power and authority to
indemnify its Directors, Trustees, Officers, employees or agents, so that any
person who is or was a Director, Trustee, Officer, employee or agent of such
constituent corporation or of any entity a majority of the voting Shares of
which is owned by such constituent corporation or is or was serving at the
request of such constituent corporation as a Director, Trustee, Officer,
employee or agent of the corporation, partnership, joint venture, trust or other
enterprise, shall stand in the same position under the provisions of this
Section with respect to the resulting or surviving Corporation as such person
would have with respect to such constituent corporation if its separate
existence had continued.
09. FURTHER BYLAWS
The Board of Directors may from time to time adopt further Bylaws with specific
respect to indemnification and may amend these and such Bylaws to provide at all
times the fullest indemnification permitted by the General Corporation Law of
the State of Nevada.
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ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated costs and expenses we will pay in
connection with the offering described in this registration statement:
--------------------------------------------
Amount
--------------------------------------------
Accounting fees and expenses 10,000
Legal fees and expenses 25,000
Transfer and miscellaneous expenses 5,000
--------------------------------------------
Total $40,000
============================================
All expenses are estimated.
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
On August 31, 2007, we issued 8,000,000 restricted common shares to our
President, Zoltan Nagy, in settlement of $40,000 in debt. The shares were
issued without registration under the Securities Act of 1933 in reliance on an
exemption from registration provided by Section 4(2) of the Securities Act. No
general solicitation was made in connection with the offer or sale of these
securities.
On September 8, 2007, we issued 100,000 restricted common shares to Marnie Kuhn,
a director, in settlement of $500 in debt. The shares were issued without
registration under the Securities Act of 1933 in reliance on an exemption from
registration provided by Section 4(2) of the Securities Act. No general
solicitation was made in connection with the offer or sale of these securities.
ITEM 27. EXHIBITS
EXHIBIT NO. DOCUMENT
3.1 Articles of Incorporation (1)
3.2 By-laws (1
5.1 Legal opinion (1)
10.1 Assignment of Copyright dated August 31, 2007 (1)
10.2 Promissory Noted dated November 12, 2007 (1)
23.1 Consent of Accountant
23.2 Consent of Counsel (contained in Exhibit 5.1)
99.1 Specimen Subscription Agreement (1)
(1) Previously filed with our initial registration statement on Form SB-2 on
December 14, 2007.
ITEM 28. UNDERTAKINGS.
(a) The undersigned small business issuer will:
(1) File, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:
(i) Include any prospectus required by section 10(a)(3) of the Securities
Act;
(ii) Reflect in the prospectus any facts or events which, individually or
together, represent a fundamental change in the information in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement.
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(iii) Include any additional or changed material information on the plan of
distribution.
(2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.
(3) File a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
(4) For determining liability of the undersigned small business issuer under
the Securities Act to any purchaser in the initial distribution of the
securities, the undersigned small business issuer undertakes that in a primary
offering of securities of the undersigned small business issuer pursuant to this
registration statement, regardless of the underwriting method used to sell the
securities to the purchaser, if the securities are offered or sold to such
purchaser by means of any of the following communications, the undersigned small
business issuer will be a seller to the purchaser and will be considered to
offer or sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned small
business issuer relating to the offering required to be filed pursuant to Rule
424 ( 230.424 of this chapter);
(ii) Any free writing prospectus relating to the offering prepared by or on
behalf of the undersigned small business issuer or used or referred to by the
undersigned small business issuer;
(iii) The portion of any other free writing prospectus relating to the
offering containing material information about the undersigned small business
issuer or its securities provided by or on behalf of the undersigned small
business issuer; and
(iv) Any other communication that is an offer in the offering made by the
undersigned small business issuer to the purchaser.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the small business issuer pursuant to the foregoing provisions, or otherwise,
the small business issuer has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable.
(c) In the event that a claim for indemnification against such liabilities
(other than the payment by the small business issuer of expenses incurred or
paid by a director, officer, or controlling person of the small business issuer
in the successful defense of any action, suit, or proceeding) is asserted by
such director, officer, or controlling person connected with the securities
being registered, the small business issuer will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(d) Each prospectus filed pursuant to Rule 424(b) as part of a registration
statement relating to an offering, other than registration statements relying on
430B or other than prospectuses filed in reliance on Rule 430A shall be deemed
to be part of and included in the registration statement as of the date it is
first used after effectiveness. Provided, however, that no statement made in a
registration statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the registration statement
will, as to a purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such
document immediately prior to such date of first use.
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SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form SB-2 Registration Statement and authorized
this registration to be signed on its behalf by the undersigned, thereunto duly
authorized, in the city of Calgary, Alberta, Canada, on January 28, 2008.
GIDDY-UP PRODUCTIONS INC.
/s/ Zoltan Nagy
By: Zoltan Nagy
President, Chief Executive Officer,
Chief Financial Officer, Principal Accounting Officer,
and a director
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person who signature appears below
constitutes and appoints Zoltan Nagy as his true and lawful attorney-in-fact and
agent, with full power of substitution and re-substitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this registration statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or any of
them, or of their substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated:.
Date: January 28, 2008 /s/ Zoltan Nagy
By: Zoltan Nagy
President, Chief Executive Officer,
Chief Financial Officer, Principal Accounting Officer,
and a director
Date: January 28, 2008 /s/ Marnie Kuhn
By: Marie Kuhn
a director