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PaddleWheel Productions, Inc. Prospectus
7
loan. Consequently, an investor may not be able to liquidate his or her investment in the PaddleWheel and should be prepared to hold the shares of stock as a long-term investment of limited liquidity.
Dividends and Dividend Policy. Each preferred stockholder is entitled to interest at five percent (5%) simple interest per annum on the face value of $990 per share. The interest is cumulative from the date of purchase. However, in the event interest dividends are not paid annually, the unpaid amount will not accrue interest. Preferred stockholders are also entitled to a pro rata share of the Company's assets, net of creditors' claims and/or liens, in the event of liquidation.
No dividends will be paid on common stock for the first two years. No dividends are promised at any time. Investors will receive semi-annual reports so that they can follow the path of the operation. After the second year, dividends will be paid when the Board of Directors feel that PaddleWheel Productions is stable and continued profit is predictable. No dividends will be declared until all five musicals are in production, and trends can be predicted effectively and thereby income can be predicted effectively. In order to maintain a reserve to cover unexpected expense, at no time will all net profit be used for dividends. Portions of the net profit will be retained each year for salary adjustments and reinvestment in the business.
Dilution. Currently, PaddleWheel has 2,616 shares of common stock outstanding. The current net tangible book value of PaddleWheel is $70,344.00. If all of the 984 Investment Units being offered are sold, then PaddleWheel will realize $984,000.00 in gross proceeds from the offering and there will be 3,600 shares of common stock outstanding. It is anticipated that the expenses involved in conducting the current offering will be approximately $10,000.00 The net proceeds from the offering plus the net tangible book value prior to the offering would equal approximately $1,054,344.00. The book value per common share after the completion of the offering, assuming all Investment Units are sold, would be $292.87 per share.
Current Stock Ownership
Outstanding Owner	# Shares
Common 2616	Mary	Ellis	1260
Percent
48.17%
43.57%
7.65%
Beth Hudson 1140 Martha Hood 200 E. A. Allen 15 Jane Brown 1
.57%
.04%
100%
Total
Preferred 16
E. A. Allen 15 Jane Brown 1
93.75%
6.25%
100%
Total
(Post Offering Stock Ownership (assuming all offered Investment Units are sold).
Outstanding Owner	# Shares
Common 3600	Mary	Ellis	1260
Percent
35%
Beth Hudson 1140 New Investors 984 Martha Hood 200
31.67%
27.33%
5.56%