Edgar Filing: FIRST LOOK MEDIA INC

As filed with the Securities and Exchange Commission on February 13, 2001.
Registration No. 33-83624

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 1
TO FORM S-1 ON FORM S-4
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
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FIRST LOOK MEDIA, INC.
(f/k/a Overseas Filmgroup, Inc.)
(Exact name of registrant as specified in its charter)

Delaware 7812 13-3751702
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)

8800 Sunset Boulevard, Third Floor
Los Angeles, California 90069
(301) 855-1199

(Address, including zip code, and telephone number,
including area code, of registrant's principal executive office)

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Willliam F. Lischak
Chief Operating Officer, Chief Financial Officer and Secretary
First Look Media, Inc.
8800 Sunset Boulevard, Third Floor
Los Angeles, California 90069
(310) 855-1199
(Name, address, including zip code, and telephone number, including
area code, of agent for service)

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Copies to:
David Alan Miller, Esq.
Graubard Mollen & Miller
600 Third Avenue
New York, New York 10016
Telephone: (212) 818-8800
Fax: (212) 818-8881

Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be
offered in connection with the formation of a holding company and there is
compliance with General Instruction G, check the following box: |_|

If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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: |_|

CALCULATION OF REGISTRATION FEE

============================================= =============== =================== ================ ==================
Proposed
Proposed Maximum
Title of Each Class of Amount to be Maximum Offering Aggregate Amount of
Securities to be Registered Registered Price Per Share Offering Price Registration Fee
--------------------------------------------- --------------- ------------------- ---------------- ------------------

Common Stock, par value $.001 per share(1) 321,429 $0.49(2) $157,500(3) $39.38(4)
============================================= =============== =================== ================ ==================

(1) The shares of common stock being registered hereby are being offered by
us in exchange for any and all of the outstanding redeemable common
stock purchase warrants that were issued in our initial public offering
in February 1995.

(2) Calculated based on the aggregate market value of the warrants to be
received by us in exchange for one share of common stock, pursuant to
Rule 457(f)(1) under the Securities Act of 1933, using the last sale
price of a warrant ($0.035) reported on the OTC Bulletin Board on
January 29, 2001 (the last date on which a trade was reported).

(3) Calculated based on the price calculated in accordance with footnote
(2), above, multiplied by the number of shares of common stock being
registered.

(4) This fee was previously paid by us in connection with the registration
of the shares of our common stock issuable upon exercise of the
warrants on Form S-1 (No. 33-83624), declared effective by the SEC in
February 1995.

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 the registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may
not issue these shares until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these shares and it is not soliciting an offer to buy these shares in
any state where the offer or sale is not permitted.

Subject to completion, dated February 13, 2001

Preliminary Prospectus

FIRST LOOK MEDIA, INC.

We hereby offer up to 321,429 shares of our common stock in exchange
for the outstanding warrants that were issued in connection with our initial
public offering in February 1995. The exchange offer is made pursuant to the
terms and subject to the conditions set forth in this prospectus and the
accompanying letter of transmittal.

In the exchange offer, we will exchange one share of our common stock
for every 14 of our outstanding warrants tendered and accepted by us for
exchange. No fractional shares of common stock will be issued in the exchange
offer. You will receive cash in lieu of any fractional shares.

Our common stock and warrants are traded on the OTC Bulletin Board
under the symbols "FRST" and "FRSTW," respectively. On ___________, 2001, the
last reported sale price of our common stock was $___________. On ________,
2001, the last reported sale price of our warrants was $_____________.

We reserve the right not to proceed with the exchange offer, as well as
the right to modify the terms of the exchange offer. The exchange offer is
conditioned upon certain customary conditions. We, in our sole discretion,
subject to applicable law, may waive any of these conditions, in whole or in
part, at any time.

The exchange offer will expire at 5:00 p.m. New York City time on
_________, 2001 unless extended by us.

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See "Risk Factors" beginning on page 6 for a discussion of certain
information that should be considered in connection with the exchange offer.

---------------------------

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 ______________ __, 2001.

Table of Contents

Page

Prospectus Summary........................................................1
Summary of the Exchange Offer.............................................2
Risk Factors..............................................................6
Selected Consolidated Financial Information..............................14
Management's Discussion and Analysis of Financial Condition
and Results of Operations..............................................15
Certain Pro Forma Effects of the Exchange Offer..........................23
Price Range of Our Common Stock and Warrants.............................24
Background of the Exchange Offer.........................................25
The Exchange Offer.......................................................26
Our Business.............................................................35
Management...............................................................61
Principal Stockholders...................................................71
Description of Securities................................................74
Certain United States Federal Income Tax Considerations..................77
Legal Matters............................................................78
Experts..................................................................78
Where You Can Find More Information......................................79

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No person is authorized by us to give any information or to make any
representations, other than those contained herein, in connection with the
solicitation and the offering made by this prospectus and, if given or made,
such information or representations should not be relied upon as having been
authorized. This prospectus does not constitute the solicitation of the sale of,
or an offer to sell, or a solicitation of the purchase of, or an offer to
purchase, any securities in any jurisdiction in which such solicitation or
offering may not lawfully be made.

---------------------------

This prospectus incorporates important business and financial
information about us that is not included or delivered with this document. This
information is available without charge to our securityholders upon written or
oral request made to us. Our address is 8800 Sunset Boulevard, Third Floor, Los
Angeles, California 90069 and our telephone number is (310) 855-1199. In order
to obtain timely delivery of any such information, you must make any request for
it no later than 5 business days prior to the expiration date of the exchange
offer described herein.

Prospectus Summary

The following summary is qualified in its entirety by reference to the
more detailed information and financial statements, including notes thereto,
appearing elsewhere in this prospectus. Your are urged to read this prospectus
in its entirety.

Our Business

We specialize in the acquisition and direct distribution of, and
worldwide license and sale of distribution rights to, independently produced
feature films in a wide variety of genres, including action, art-house, comedy,
drama, foreign language, science fiction and thrillers. We have accumulated a
library of distribution rights in various media and markets to approximately 250
feature films.

We have focused primarily on licensing theatrical, video, pay
television, free television, satellite and other distribution rights to foreign
sub-distributors in major international territories and regions. These
activities accounted for approximately 68% of our total revenues in 1999 and
approximately 73% of our total revenues in the first nine months of 2000.

We engage directly in domestic theatrical distribution through our
First Look Pictures division and domestic video distribution through our First
Look Home Entertainment division. Our theatrical distribution activities include
booking motion pictures for exhibition at movie theaters, arranging for the
manufacture of release prints from film negatives, and promoting motion pictures
with advertising and publicity campaigns. Our video distribution activities
include the promotion and sale of videocassettes to local, regional and national
video retailers. We have also recently launched a television commercial
production division.

Corporate Information

Our company was incorporated in Delaware in December 1993 under the
name "Entertainment/Media Acquisition Corporation" in order to acquire an
operating business in the entertainment and media industry. We consummated our
initial public offering in February 1995, in which we sold shares of our common
stock and the warrants that are the subject of the exchange offer.

In October 1996, we merged with Overseas Filmgroup, Inc., a
privately-held Delaware corporation ("Overseas Private") that had been operating
since February 1980. Our company was the surviving corporation in the merger.
Upon consummation of the merger, we changed our name to "Overseas Filmgroup,
Inc." We operated under the name "Overseas Filmgroup, Inc." until January 2001.
In January 2001, we changed our name to "First Look Media, Inc." in order to
reflect the broadening of our operations beyond foreign distribution of
independently produced feature films to additional areas such as television
commercial production and Internet content development.

Our principal executive offices are located at 8800 Sunset Boulevard,
Third Floor, Los Angeles, California 90069, and our telephone number is (310)
855-1199.

Summary of the Exchange Offer

The offer................... We are offering to exchange one share of our
common stock for every 14 of the outstanding
warrants, issued in our initial public
offering in February 1995, that are tendered
and accepted by us for exchange. No
fractional shares of common stock will be
issued. You will receive cash in lieu of any
fractional shares.

Expiration date............ 5:00 p.m., New York City time, on _________,
2001, unless extended as provided in the
section of this prospectus entitled "The
Exchange Offer - Expiration Date;
Extensions; Termination; Amendments."

The warrants............... As of February 6, 2001, there were 4,500,000
public warrants outstanding. Each warrant
currently entitles the holder to purchase
one share of common stock for $5.00, subject
to adjustment in certain events. Provided
that a prospectus with respect to the common
stock is in effect, the public warrants may
be exercised at any time until February 16,
2002. We have the right to redeem the
warrants under certain circumstances. See
"Description of Securities - Warrants."

Purpose of the
exchange offer........... To retire any and all of our public warrants
through the issuance of common stock. This
would allow us to simplify our capital
structure, reduce the potential future
dilutive impact on our per-share earnings
that could be caused by the warrants, and
diminish or eliminate overhang on the
market price of our common stock caused by
the warrants.

Conditions of the exchange
offer................... The exchange offer is subject to certain
customary conditions, any or all of which
may be waived by us in our sole discretion,
subject to applicable law. The exchange
offer is not conditioned upon any minimum
number of warrants being tendered. See "The
Exchange Offer - Conditions of the Exchange
Offer."

Effects of the exchange
offer on our company.... In the absence of the exchange offer, an
additional 4,500,000 shares of common stock
would be issued if all of the currently
outstanding warrants were exercised, and we
would receive the cash proceeds of such
exercises. Assuming 100% participation in
the exchange offer, 321,429 shares of common

stock would be issued and all of the
outstanding warrants would be extinguished
and we would receive no cash proceeds. The
exchange offer will have no effect on total
stockholders' equity (other than transaction
costs). See "Background of The Exchange
Offer," "Selected Consolidated Financial
Information" and "Certain Pro Forma Effects
of the Exchange Offer."

Effects of the exchange
offer on you, if you
participate.............. If you participate in the exchange offer,
you will:

o receive one share of common stock
for every 14 warrants you tendered
and we accept, without having to
make any exercise payments;

o receive a cash payment, without
interest, for any fractional shares
of common stock that you would
otherwise be entitled to receive;

o be able to vote the common stock
received in the exchange offer on
all matters that may come before
the holders of our common stock;

o be able to receive dividends on
such common stock, if any, when
declared and paid by us; and

o participate as a holder of common
stock in proceeds from any
liquidation of our company after
creditors and preferred security
holders, if any, are paid.

However, if you participate in the exchange
offer, you will lose the right to purchase a
share of common stock for $5.00 for each
warrant held, and may be subject to certain
tax consequences as a result of the exchange
offer. See "Certain United States Federal
Income Tax Considerations."

Effects of the exchange
offer on you, if you
don't participate....... If you do not participate in the exchange
offer, you will retain the right to
purchase, at any time until February 16,
2002, one share of common stock for $5.00
for each warrant held, subject to our right
to redeem the warrants under certain
circumstances. However, you should note,
that if the exchange offer is consummated,

we intend to delist the warrants from
trading on the OTC Bulletin Board and to
deregister the warrants pursuant to the
Exchange Act. In such event, the trading
market for, and the liquidity of an
investment in, the warrants remaining
outstanding would be significantly reduced.
You will not have any appraisal or
dissenters' rights under Delaware law.

Procedures for
tendering warrants..... If you wish to tender your warrants, you
must deliver the following documents prior
to 5:00 p.m., New York City time, on the
expiration date to the exchange agent at the
address set forth on page 33:

o certificates representing the
warrants being tendered together
with a letter of transmittal
properly completed and duly
executed by you and all other
documents required by the letter of
transmittal; or

o if you wish to tender by guaranteed
delivery, a properly completed and
duly executed guaranteed delivery
form. See "The Exchange Offer -
Procedure for Tendering" and "-
Guaranteed Delivery Procedure."

If you hold warrants in book-entry form, you
may participate in the exchange offer by
complying with the procedures for book-entry
transfer set forth in the section of this
prospectus entitled "The Exchange Offer -
Procedure for Tendering." If your warrants
are registered in the name of brokers,
dealers, commercial banks, trust companies
or nominees, you are urged to contact such
registered holders promptly if you wish to
participate in the exchange offer. Warrants
should not be sent to us.

Withdrawal of tenders..... Tenders of warrants may be withdrawn at any
time prior to 5:00 p.m., New York City time,
on the expiration date or, unless previously
accepted for exchange, after 5:00 p.m., New
York City time, on ________________, 2001.
See "The Exchange Offer - Withdrawal
Rights."

Acceptance of warrants and
delivery of common stock. We will accept all warrants properly
tendered and not withdrawn prior to 5:00
p.m., New York City time, on the expiration
date, by giving oral or written notice to
the exchange agent promptly after the
expiration date. We will deliver shares of
common stock pursuant to the exchange offer
(and any cash payment in lieu of fractional
shares) promptly following such acceptance.
See "The Exchange Offer - Acceptance of
Warrants for Exchange; Delivery of Common
Stock."

Certain federal income tax
considerations............ You are urged to consult your own tax
advisors as to the specific tax consequences
of the exchange offer. In general, however,
we believe that the exchange of common stock
for warrants will likely be treated as a
taxable transaction for federal income tax
purposes. See "Certain United States Federal
Income Tax Considerations."

Payment of solicitation
fees................... We will pay a solicitation fee of $0.02 per
warrant to Shochet Securities, Inc.
("Shochet") for warrants tendered in the
exchange. Shochet is an affiliate of GKN
Securities Corp. ("GKN"), the managing
underwriter of our initial public offering.
See "The Exchange Offer - Interests of
Certain Persons in the Exchange Offer" and
"The Exchange Offer - Payment of
Solicitation Fees."

We make no recommendation that you tender or refrain from tendering
your warrants, and no one has been authorized to make any such recommendation on
behalf of our company. The decision to tender is a matter for you to determine
after consultation with your advisors, including tax counsel, on the basis of
your own financial position and requirements.

The delivery of this prospectus shall not, under any circumstances,
create an implication that there has been no change in the affairs of our
company since the date hereof or that the information herein is correct as of
any time subsequent to such date.

Risk Factors

If you participate in the exchange offer, you will surrender your
warrants and receive shares of our common stock, thereby changing the nature of
your interest in our company. You should carefully consider the following risk
factors, as well as the information set forth elsewhere in this prospectus, in
determining whether to participate in the exchange offer.

Risks relating to the exchange offer

The consummation of the exchange offer will likely decrease the liquidity of any
warrants that remain outstanding.

If the exchange offer is consummated, we intend to deregister the
warrants under the Exchange Act, and delist the warrants from trading on the OTC
Bulletin Board. If we do this, the trading market for, and liquidity of an
investment in, any warrants remaining outstanding would be significantly
reduced. Any reduction in trading liquidity could depress the market value of
any remaining outstanding warrants.

At the time the exchange offer is actually consummated, the exchange ratio may
not directly relate to the then-current market prices of the common stock being
issued to you or the warrants being surrendered by you.

On ________, 2001, the last reported sale price of our common stock as
reported on the OTC Bulletin Board was $_______. On ____________2001 , the last
reported sale price of our warrants was $_____. For the 30-trading day period
ending on _____, 2001, the average last sale prices of our common stock and
warrants were $_______ and $________, respectively. For the 60-trading day
period ending on __________, 2001, the average last sale prices of our common
stock and warrants were $______ and $______, respectively.

The exchange ratio of one share of common stock for every 14 warrants
was fixed as of the date of this prospectus and represents (as of that date) a
premium to the exchange ratio implied by the relationship between the average
trading prices of our common stock and warrants for each of the dates and
periods described above. However, the market prices of our common stock and
warrants are subject to fluctuations, which may be exacerbated by the
announcement and consummation of the exchange offer itself. On the date the
exchange offer is actually consummated, the exchange ratio may not directly
relate to the then-current market prices of the securities involved in the
exchange offer and may not result in you receiving the premium that was
originally contemplated at the time the exchange ratio was set.

If you participate in the exchange offer, you may give up the investment
leverage afforded by the warrants.

You will have to give up 14 warrants to receive one share of common
stock in the exchange offer. It may be more beneficial for you to own our
warrants as opposed to our common stock. For example, if the market price of a
share of our common stock increases to $6.00, thereby exceeding the $5.00
exercise price of a warrant by $1.00, each warrant you owned would give you the
ability to realize a profit equal to $1.00 (without giving effect to the price
you actually paid for the warrant and applicable tax liabilities). In this
scenario, if you owned 14 warrants, you could realize an aggregate profit of

$14.00 by exercising all of your warrants and selling the underlying common
stock. In this same scenario, if you had previously surrendered your 14 warrants
in the exchange offer and received one share of common stock, you could sell the
share for $6.00 and could realize a profit equal to the difference between
$6.00 and your cost basis in the share. However, if you do participate in the
exchange offer and surrender your warrants, you will have the ability to
participate in any post-exchange offer appreciation of our common stock, even at
market prices below the $5.00 exercise price of the warrants. The market price
of our common stock may never exceed $5.00 and may not appreciate from the
market price in effect on the date the exchange offer is consummated.

If you participate in the exchange offer, the exchange will be tax free.

We believe that for federal income tax purposes the exchange offer will
be treated as a tax free recapitalization transaction to persons tendering their
warrants in the exchange offer. For a discussion of certain general tax
consequences to exchanging warrant holders, see "Certain United States Federal
Income Considerations." The exchange offer will not affect the federal income
tax treatment of holders who do not participate in the exchange offer.

The fact that our securities are traded only on the OTC Bulletin Board could
depress the market prices for these securities.

We believe that the fact that our securities are traded only on the OTC
Bulletin Board could serve to:

o limit distribution of news relating to our company;

o limit investor interest in our securities; and

o restrict our ability to issue additional securities and secure
additional financing.

One or more of these factors could serve to depress the liquidity and market
prices of our securities. We may never apply to, or be accepted by, any trading
market or exchange that provides enhanced liquidity and information flow.

The exchange offer could have a negative effect on the market price of our
common stock.

The issuance of a significant number of shares of common stock in the
exchange offer will cause an initial dilution in per-share earnings and other
per-share measurements, which may have a negative effect on the market price for
our common stock (and, in turn, any warrants still outstanding after
consummation of the exchange offer).

As a holder of common stock, you would be subject to the dilutive effects caused
by future issuances of our common stock.

Following consummation of the exchange offer, we will not need to
reserve as many shares (if any) of common stock for possible future exercises of
the warrants. Accordingly, the number of authorized, but unissued and
unreserved, shares of common stock available for other issuances would increase.
Our board of directors is empowered, without stockholder approval, to issue any
or all of such authorized (but unissued and unreserved) shares of common stock.
These issuances (depending on the consideration, if any, received) may dilute
the interests of common stock holders and affect the market price of our common

stock (and any remaining outstanding warrants). Other potential issuances of
securities, such as options under our stock option plan or shares of our
preferred stock, may have similar effects. Also, potential sales of substantial
blocks of our outstanding securities by holders could have a negative impact on
the market price of our common stock (and any remaining outstanding warrants).

We have the right to redeem the warrants.

Any warrants not exchanged in the exchange offer may be redeemed by us,
at a price of $.01 per warrant, subject to not less than 30 days' prior written
notice to you, provided that the last sale price of the common stock has been at
least $8.50 per share for the 20 consecutive trading days ending on the third
day prior to the day on which notice is given. Notice of the redemption of the
warrants could force you to exercise the warrants and pay the exercise price at
a time when it may be disadvantageous for you to do so, to sell the warrants at
the then-current market price when they might otherwise wish to hold the
warrants, or to accept the $.01 per warrant redemption price. See "Description
of Securities - Warrants."

Risks relating to our business

Virtually all of our assets are pledged to secure our obligations under our
credit facility with The Chase Manhattan Bank.

In June 2000, we entered into a $40 million five-year secured revolving
credit facility with The Chase Manhattan Bank and other commercial banks and
financial institutions. To secure our obligations under the Chase facility, we
and our domestic subsidiaries have pledged our assets to Chase. If we default on
our obligations under the Chase facility, the banks under the Chase facility
will have the right to satisfy our obligations through these assets. If this
occurs, we may not be able to continue our business or operations. Further,
applicable state law and contractual restrictions, including restrictions in the
Chase facility, prohibit payment of dividends or distributions to holders of our
securities in various circumstances.

We anticipate that our acquisition, production and marketing costs will continue
to be significant.

For 1997, 1998, 1999 and the first nine months of 2000, the average
direct negative costs of motion pictures that we have distributed were
approximately $2,100,000, $2,800,000, $5,900,000 and $2,867,000, respectively.
Direct negative costs include production costs of acquiring or developing the
screenplay, the compensation of creative and other production personnel, film
studio and location rentals, equipment rentals, film stock and other costs
incurred in principal photography, as well as post-production costs such as the
creation of special effects and music. For 1997, 1998, 1999 and the first nine
months of 2000, the average print and advertising costs associated with the
motion pictures distributed by First Look Pictures were approximately $561,000,
$0 (no films released), $510,000 and $330,000, respectively.

In the future, we may distribute, finance or produce motion pictures
with substantial direct negative costs and marketing costs. These costs would
continue to be significant and could exceed the average direct negative and
marketing costs of the films that we have historically distributed.

Our operations would be hurt if we lost the services of certain of our
personnel.

Christopher J. Cooney serves as our co-chairman of the board and chief
executive officer, Robert B. Little serves as our co-chairman of the board and
president, and William F. Lischak serves as our chief operating officer and
chief financial officer. Virtually all decisions concerning the conduct of our
business, including the motion picture properties and rights that we acquire and
the arrangements that we make for our distribution, production and financing of
motion pictures, are made or are significantly influenced by these key
executives. The loss of any of their services for any reason would have a
material adverse effect on our business, operations and future prospects. In
addition, our credit facility with Chase generally requires Mr. Little, Mr.
Cooney and Mr. Lischak's continued involvement with, and control of, our
company.

Our receipt of minimum guarantees does not eliminate the risks we face when we
license distribution rights.

We usually receive a minimum guarantee for licensing distribution
rights to sub-distributors. However, these minimum guarantees do not assure the
profitability of our motion pictures or our operations. Additional revenues may
be necessary from distribution of a motion picture in order for us to recover
any investment in excess of the aggregate minimum guarantees, pay for
distribution costs, continue acquisition and development of other motion
pictures, and cover general overhead. Licensing distribution rights to
sub-distributors in exchange for minimum guarantees may also result in us
receiving lower revenues with respect to highly successful films.

We may not be able to achieve our acquisition and distribution goals.

We currently intend to acquire rights to and distribute approximately
eight to twelve films per year. Alone or in conjunction with others, we
currently intend to selectively finance all or a portion of the production costs
of, or produce, an aggregate of approximately two to six of these films. We may
not meet these goals and the number of films that we acquire, distribute or
finance may not meet these estimated ranges.

Our First Look Pictures operations face their own particular risks.

Our domestic theatrical distribution activities, which are conducted
through our First Look Pictures division, face numerous challenges and risks,
including:

o The success of a domestic theatrical release can be affected
by a number of factors outside of our control, including
audience and critical acceptance, the success of competing
films in release, awards won by First Look Pictures' releases
or that of its competition, inclement weather, and competing
televised events, such as sporting and news events.

o Payment to First Look Pictures by national theater chains in
the United States is typically made on the close of the
engagement in all the chain's theaters. Since First Look
Pictures typically releases its films on a more limited basis
than a distributor of nationwide releases and since First Look
Pictures' specialized or art-house releases can have extended
runs, theater chains often do not pay us for three to six
months from initial release, or longer.

o First Look Pictures' releases are exhibited by a substantial
number of independent theater owners for which it can be
comparatively more difficult to monitor and enforce timely
payment than with respect to national theater chains.

Our quarterly results fluctuate significantly.

Our operating revenues, cash flow and net earnings historically have
fluctuated significantly from quarter to quarter depending in large part on the
number of motion pictures for which we acquire distribution rights and actually
distribute and the amount of revenues recognized and production costs incurred
and amortized during the period. Therefore, year-to-year comparisons of
quarterly results may not be meaningful and quarterly results during the course
of any year may not be indicative of results expected for the entire year.

Our company is effectively controlled in all respects by our management.

Our directors and executive officers, as a group, beneficially own
approximately 79.8% of our voting securities. Accordingly, these persons, acting
together, will be in a position to effectively control our company in all
respects, including the election of our directors. See "Management" and
"Principal Shareholders."

Our issuance of preferred stock could diminish the value of your common stock.

Our restated certificate of incorporation authorizes the issuance of
"blank check" preferred stock with such designations, rights and preferences as
may be determined from time to time by our board of directors. Subject to the
rules of the NASD, our board of directors is empowered, without stockholder
approval, to issue preferred stock with dividend, liquidation, conversion,
voting or other rights that could adversely affect the voting power or other
rights of the holders of the common stock (or any remaining outstanding
warrants). The preferred stock could be utilized, under certain circumstances,
as a method of discouraging, delaying or preventing a change in control of our
company, which could have the effect of discouraging bids for our company and,
thereby, preventing stockholders from receiving the maximum value for their
shares.

The current Screen Actors Guild/American Federation of Television and Radio
Artists strike against commercial advertisers could hamper our ability to grow
our television commercial production division.

As of the date of this prospectus, a national strike by members of the
Screen Actors Guild and American Federation of Television and Radio Artists
unions against commercial advertisers, producers and agencies is in progress.
This strike began on May 1, 2000 and potentially involves more than 130,000
union-member actors. Members of the striking unions are demanding increases to
the residual payments they receive every time a commercial in which they appear
in is broadcast. They are also demanding pay-per-play cable and Internet
arrangements. The strike could hamper our ability to produce television
commercials. In addition, the terms on which they strike is ultimately settled
could increase costs associated with our commercial production operations,
thereby hampering our ability to grow these operations.

Risks relating to our industries

Because the motion picture industry is highly speculative and inherently risky,
some or all of the motion pictures that we release, distribute or produce will
not be commercially successful and we will not be able to recover our costs or
realize anticipated profits.

The motion picture industry is highly speculative and inherently risky.
We cannot assure you that any motion picture we release, distribute or produce
will be successful since the revenues derived from the production and
distribution of a motion picture depend primarily upon its acceptance by the
public, which cannot be predicted. The revenues derived also may not necessarily
correlate to the production or distribution costs incurred.

A motion picture's commercial success also depends upon the quality and
acceptance of other competing films released into the marketplace at or near the
same time, the availability of alternative forms of entertainment and leisure
time activities, general economic conditions and other tangible and intangible
factors, all of which can change and cannot be predicted with certainty.
Therefore, there is a substantial risk that some or all of the motion pictures
that we release, distribute or produce will not be commercially successful,
resulting in costs not being recovered or anticipated profits not being
realized.

We have not been able to fully capitalize on significant changes in the motion
picture industry and we may not be able to capitalize on changes in the future.

The entertainment industry in general, and the motion picture industry
in particular, are dynamic industries that have undergone significant changes.
Some of the most recent changes include:

o increases in revenues generated from the licensing of rights
in media ancillary to domestic theatrical media;

o studio and theater-chain ownership changes;

o consolidation in the industry; and

o rapid technological change.

We have not benefited from some of these changes. To date, we have not
realized any significant revenues from the newest revenue sources, such as
computer and video games and other interactive media. In addition, some changes
in the motion picture industry have negatively impacted us. For example, despite
the expansion in the market for videocassettes for home use, generally retail
video stores increasingly have been purchasing fewer copies of videocassettes of
motion pictures that have not been theatrically released. Because we distribute
a number of films that are not released theatrically, this trend has impacted us
negatively and has led us to establish our own domestic theatrical and video
distribution operations. We cannot predict what changes or trends will continue
in the motion picture industry, what new changes or trends might occur, and the
overall effect these factors will have on our potential revenue from and
profitability of feature-length motion pictures and our business.

Domestic theatrical distribution is very competitive and dominated by major
studio distributors.

We engage in domestic theatrical distribution through our First Look
Pictures division. Domestic theatrical distribution is very competitive. A
substantial majority of the motion picture screens in the United States
typically are committed at any one time to between 10 and 15 films distributed
nationally by major studio distributors that can command greater access to
available screens. Although some theaters specialize in exhibiting independent
motion pictures and art-house films, there is intense competition for screen
availability for these films as well. The number of motion pictures released
theatrically in the United States also has increased in recent years, which has
increased competition for exhibition outlets and audiences.

We face numerous risks in our international distribution activities.

In 1999 and the first nine months of 2000, we derived approximately 68%
and 73%, respectively, of our revenues from distributing motion pictures and
licensing distribution rights in territories outside the United States. Our
financial results and results of operations could be negatively affected by the
following:

o changes in foreign currency exchange rates and currency
controls;

o trade protection measures;

o motion picture piracy;

o content regulation;

o longer accounts receivable collection patterns;

o changes in regional or worldwide economic or political
conditions; or

o natural disasters.

Because our contracts are typically denominated in U.S. dollars,
advances and minimum guarantees of sub-license fees payable to us by foreign
sub-distributors, and advances and minimum guarantees that we pay to foreign
producers in connection with the acquisition of distribution rights generally
are unaffected by exchange rate fluctuations. However, to the extent our
agreements with foreign sub-distributors require them to pay us a percentage of
revenues in excess of any advance or minimum guarantee, fluctuations in the
currencies in which these revenues are received by the sub-distributor may
affect the amount of U.S. dollars that we receive in excess of any minimum
guarantee. Exchange rate fluctuations also could affect the ability of
sub-distributors to pay agreed minimum guarantees or to bid for and acquire
rights to motion pictures that we distribute. Although exchange rate
fluctuations generally have not had a material effect on our results of
operations in the past, we cannot assure you that these fluctuations will not
have a material impact on our future results of operations.

This prospectus contains forward-looking statements, which may prove inaccurate

Some of the statements in this prospectus are forward-looking
statements that involve risks and uncertainties. These forward-looking

statements include statements about our plans, objectives, expectations,
intentions and assumptions that are not statements of historical fact. You can
identify these statements by words such as "may," "will, "should," "plans,"
"expects," "believes," "intends" and similar expressions. We cannot guarantee
our future results, performance or achievements. Our actual results and the
timing of corporate events may differ significantly from the expectations
discussed in the forward-looking statements. You are cautioned not to place
undue reliance on any forward-looking statements.

Selected Consolidated Financial Information
(in thousands of dollars, except per-share data)

The following selected consolidated financial data as of and for each
of the years in the five-year period ended December 31, 1999 are derived from
our consolidated financial statements, which statements have been audited by
PricewaterhouseCoopers LLP, independent accountants.

The selected consolidated balance sheet data at September 30, 2000, and
the selected statement of operations data for the nine-month periods ended
September 30, 1999 and September 30, 2000, have been derived from our unaudited
consolidated financial statements which, in our opinion include all adjustments
(consisting of normal recurring adjustments) considered necessary for a fair
statement of the results of unaudited periods. The results for the nine-month
period ended September 30, 2000 are not necessarily indicative of the results
that may be expected for the year ended December 31, 2000.

The selected consolidated financial data set forth below should be read
in conjunction with our consolidated financial statements and the notes thereto,
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations," each included elsewhere in this prospectus. "Statement of
Operations Data" presented below includes reclassifications of certain revenue
and expense items which are not directly associated with operations. Such
reclassifications include interest income, interest expenses, foreign exchange
effects and other non-operating items.

Year Ended December Nine Months Ended
31, September 30,
----------------------------------------------------- ------------------

1995 1996 1997 1998 1999 1999 2000
---- ---- ---- ---- ---- ---- ----

Statement of Operations Data: (unaudited)
Revenues $21,672,510 $28,677,571 $22,494,256 $25,585,476 $33,783,836 $19,957,534 $15,227,764
Film costs 16,320,694 23,058,000 19,152,847 21,014,728 30,887,786 16,943,188 11,591,341
Distribution and marketing costs --- --- --- --- --- --- 2,045,530
Selling, general and administrative 2,721,745 3,595,660 3,509,122 2,960,383 2,983,224 2,240,931 3,038,735
Income (loss) from operations 2,630,071 2,023,910 (167,713) 1,610,365 (87,174) 773,415 (1,447,842)
Income (loss) before tax and
cumulative effect of accounting
changes 2,894,066 1,665,269 (837,277) 112,472 (1,988,568) (622,203) (1,967,796)
Income tax provision (benefit) (1) 432,905 3,131,367 (293,357) 53,000 (736,000) (231,000) 104,651
Income (Loss) before cumulative
effect of accounting changes 2,461,161 (1,466,098) (543,920) 59,472 (1,252,568) (391,203) (2,072,447)
Cumulative effect of accounting
changes --- --- --- --- --- --- (14,123,133)
Net Income (Loss) 2,461,161 (1,466,098) (543,920) 59,472 (1,252,568) (391,203)(16,195,580)
Basic and diluted net income (loss)
per share: before cumulative effect 0.77 (0.41) (0.09) 0.01 (0.21) (0.07) (0.27)
Cumulative effect --- --- --- --- --- --- (1.87)
Net Income (Loss) per share after
cumulative effect 0.77 (0.41) (0.09) (0.01) (0.21) (0.07) (2.14)
Basic and diluted weighted average
number of shares outstanding 3,177,778 3,611,111 5,747,778 5,732,778 5,990,153 5,887,318 7,563,508

Year Ended December Nine Months Ended
31, September 30,
----------------------------------------------------- ------------------

Balance Sheet Data: 1995 1996 1997 1998 1999 1999 2000
---- ---- ---- ---- ---- ---- ----
(unaudited)

Film costs, net of
accumulated amortization $17,349,071 $28,358,324 $29,740,567 $29,003,201 $28,363,419 $29,517,323 $15,701,843
Total assets 28,954,796 40,803,685 46,560,320 50,208,688 62,646,894 54,067,926 46,399,665
Total long-term liabilities 7,421,893 16,607,137 23,142,184 22,013,281 19,764,175 19,426,845 6,219,218
Total liabilities 17,506,422 28,611,919 34,999,208 38,588,104 49,346,572 41,321,637 32,102,477
Total shareholders' equity 11,448,374 12,191,766 11,561,112 11,620,584 13,300,322 12,746,289 14,297,188

(1) From January 1, 1989 to October 31, 1996, Overseas Private operated as
an S corporation under subchapter S of the Internal Revenue Code.
During the year ended December 31, 1996, we recorded a one-time,
non-recurring deferred federal income tax charge of $2,600,000 relating
to the termination of Overseas Private's S corporation status which
occurred on October 31, 1996, the date of our merger with Overseas
Private.

(2) During the nine months ended September 30, 2000, we recorded a
one-time, pre-tax non-cash charge of $15,581,738 ($14,123,133 after
taxes).

The Company has restated filings on Form 10-Q for the quarterly period ended
September 30, 2000 for transactions related to the forgiveness of amounts due
from related parties under the terms of the Purchase Agreement in order to
account for these transactions in compliance with the provisions of Accounting
Principals Board Opinion 26 and SEC Staff Accounting Bulletin Topic 5-T. The
$558,810 and $125,131 for accrued interest and salaries, respectively, forgiven
by the principal shareholders in June 2000 were originally recognized as other
income and as a reduction of selling, general and administrative expense. In
these revised financial statements, these amounts are accounted for as a capital
contribution.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

General

The operations of Overseas Private were established in February 1980.
We were formed in December 1993 under the name "Entertainment/Media Acquisition
Corporation" for the purpose of acquiring an operating business in the
entertainment and media industry. We acquired Overseas Private through a merger
in October 1996 and we were the surviving corporation in the merger. Immediately
following the merger, we changed our name to "Overseas Filmgroup, Inc." and
succeeded to the operations of Overseas Private. In January 2001, we changed our
name to "First Look Media, Inc." in order to reflect the broadening of our
operations beyond foreign distribution of independently produced feature films
to additional areas such as television commercial production and Internet
content development.

Today, we are principally involved in the acquisition and worldwide
license or sale of distribution rights to independently produced motion
pictures. Certain motion pictures are directly distributed by us in the domestic
theatrical market under the name "First Look Pictures" and in the domestic video
market under the name "First Look Home Entertainment."

Relevant accounting provisions

In June 2000, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of Position
00-2, "Accounting by Producers or Distributors of Films" ("SOP 00-2"). SOP 00-2
establishes new film accounting standards, including changes in revenue
recognition and accounting for advertising, development and overhead costs.
Additionally, in June 2000, the Financial Accounting Standards Board ("FASB")
issued Statement 139 ("SFAS 139") which rescinds FASB 53 on financial reporting
by motion picture film producers or distributors. SFAS 139 requires public
companies to follow the guidance provided by SOP 00-2. We have elected early
adoption of SOP 00-2. During the nine months ended September 30, 2000, we
recorded a one-time, pre-tax non-cash charge of $15,581,738 ($14,123,133 after
taxes).

This charge has been reflected in the Company's Consolidated Statements
of Operations as a cumulative effect of accounting changes, effective January 1,
2000. Under the SOP 00-2 for the nine months ended September 30, 2000, the
Company recognized additional distribution expense of approximately $1,432,000.

The Company has restated filings on Form 10-Q for the quarterly period
ended September 30, 2000 for transactions related to the forgiveness of amounts
due from related parties under the terms of the Purchase Agreement in order to
account for these transactions in compliance with the provisions of Accounting
Principals Board Opinion 26 and SEC Staff Accounting Bulletin Topic 5-T. The
$558,810 and $125,131 for accrued interest and salaries, respectively, forgiven
by the principal shareholders in June 2000 were originally recognized as other
income and as a reduction of selling, general and administrative expense. In
these revised financial statements, these amounts are accounted for as a capital
contribution.

In December 1999, the SEC issued Staff Accounting Bulletin No. 101,
"Revenue Recognition in Financial Statements" ("SAB 101"), which will be
effective in the fourth quarter of 2000. SAB 101 clarifies certain existing
accounting principles for the recognition and classification of revenues in
financial statements. While our existing revenue recognition policies are
consistent with the provisions of SAB 101, the new rules are expected to result
in some changes as to how the filmed entertainment industry classifies its
revenues, particularly relating to distribution arrangements for third-party and
co-financed joint venture product. As a result, we are in the process of
evaluating the overall impact of SAB 101 on our consolidated financial
statements. However, other aspects of SAB 101 are not expected to have a
significant effect on our consolidated financial statements.

Results of operations

Nine Months Ended September 30, 2000 Compared to
Nine Months Ended September 30, 1999

Revenues decreased by $4,729,770 (23.7%) to $15,227,764 for the nine
months ended September 30, 2000, compared to $19,957,534 for the nine months
ended September 30, 1999. The decrease in revenues was primarily due to
decreased revenues generated by films during the nine months ended September 30,

2000 as compared to the nine months ended September 30, 1999. We generated
revenues of approximately $8,435,000 from six films during the nine months ended
September 30, 2000, compared to revenues of approximately $13,246,000 generated
from six films during the nine months ended September 30, 1999.

In accordance with SOP 00-2, distribution and marketing costs have been
expensed in the nine months ended September 30, 2000. For the nine months ended
September 30, 1999, distribution and marketing costs were capitalized and
amortized as film costs. Film costs as a percentage of revenues decreased to
76.1% for the nine months ended September 30, 2000, compared to 84.9% for the
nine months ended September 30, 1999. The decrease, however, is offset by an
immediate expense of P&A costs now treated as "Distribution and Marketing
Costs".

Selling, general and administrative expenses, net of amounts
capitalized to film costs, increased by $797,804 (35.6%) to $3,038,735 for the
nine months ended September 30, 2000, as compared to $2,240,931 for the nine
months ended September 30, 1999. This increase was primarily due to decreased
capitalized overhead of approximately $276,484 and increases in:

o accounting fees of $27,735;
o advertising costs of $10,086;
o bad debt expense of $88,283;
o insurance costs of $51,711;
o compensation costs of $427,153;
o research expenses of $13,331;
o taxes of $22,179;
o travel expenses of $17,715;
o office expenses of $12,841;
o telephone and fax charges of $14,657;
o depreciation of computer equipment of $13,086.

These increases were partially offset by decreases in consulting fees and
contract labor ($155,692) and legal fees ($21,348).

Net other expense was $519,954 for the nine months ended September 30,
2000, compared to net other expense of $1,395,618 for the nine months ended
September 30, 1999. The increase in net other expense was primarily due to:

o the gain reported on our sale of shares of common stock of
Yahoo!, Inc. ($624,868); and

o decreased interest expense ($195,131).

As a result of the above, we had a loss before income taxes and
cumulative effect of accounting changes of $1,967,796 for the nine months ended
September 30, 2000, compared to a loss before income taxes and cumulative effect
of accounting changes of $622,203 for the nine months ended September 30, 1999.

We had a loss before cumulative effect of accounting changes of
$2,072,447 for the nine months ended September 30, 2000, compared to a loss
before cumulative effect of accounting changes of $391,203 for the nine months
ended September 30, 1999.

We reported the cumulative effect of accounting changes of $14,123,133,
net of income tax benefit of $1,458,605 for the nine months ended September 30,
2000

We had a net loss of $16,195,580 for the nine months ended September
30, 2000 (reflecting foreign withholding taxes of $104,651), compared to a net
loss of $391,203 for the nine months ended September 30, 1999 (reflecting an
effective income tax benefit of 37.1%).

Year ended December 31, 1999 compared to year ended December 31, 1998

Revenues increased by $8,198,360 (32%) to $33,783,836 for the year
ended December 31, 1999, compared to $25,585,476 for the year ended December 31,
1998. The increase in revenues was due in part to more films generating in
excess of $1,000,000 each in revenue in 1999 as compared to 1998. We licensed
rights to eight motion pictures that each generated over $1,000,000 in revenue
during 1999 and which in the aggregate generated approximately $22,947,000 in
revenue, compared to only six films that each generated over $1,000,000 in
revenue during 1998 and which in the aggregate generated approximately
$16,472,000 in revenue.

Film costs as a percentage of revenues increased to 91.4% for the year
ended December 31, 1999, compared to 82.1% for the year ended December 31, 1998.
The increase was primarily due to lower gross margins on the titles released in
the year ended December 31, 1999 as compared to the year ended December 31,
1998, and a write-off of development costs of approximately $1,100,000 relating
to three films which, although we continue to actively attempt to arrange for
their production, have not been set for production within the three-year
guideline provided in SFAS 53.

Selling, general and administrative expenses, net of amounts
capitalized to film costs, increased by $22,841 (0.8%) to $2,983,224 for the
year ended December 31, 1999, compared to $2,960,383 for the year ended December
31, 1998. We capitalize some of our overhead costs incurred in connection with
our acquisition of rights to a motion picture by adding the costs to the
capitalized film costs of the motion picture. The increase in selling, general
and administrative expenses, net of amounts capitalized to film costs, was
partially the result of fewer expenses being capitalized. We capitalized
expenses of $1,229,222 for the year ended December 31, 1998, compared to
$1,088,811 for the year ended December 31, 1999. Other increases included:

o accounting expenses of $22,110;
o bad debt expenses of $129,178;
o consulting fees of $62,678;
o contract labor of $27,685; and
o legal fees of $28,621.

These increases were partially offset by decreases in selling, general
and administrative expenses from the prior year, including decreases in:

o equipment leases of $15,390;
o directors and officers insurance premiums of $19,326;
o the officer life insurance premiums of $26,814;
o employee benefits of $76,517;

o expenses related to our being a publicly traded company of
$20,360;
o publicity expenses of $46,919;
o reader and research expenses of $25,050;
o compensation costs of $102,326; and
o telephone and fax costs of $41,603.

Other expense increased by $403,502 (26.9%) to $1,901,395 for the year
ended December 31, 1999, compared to $1,497,893 for the year ended December 31,
1998. This increase was primarily due to decreased capitalized interest costs of
$136,204 for the year ended December 31, 1999, compared to $649,005 for the year
ended December 31, 1998. Interest costs and fees, before capitalization,
decreased by $138,626 to $2,154,532 for the year ended December 31, 1999,
compared to $2,293,158 for the year ended December 31, 1998, primarily as the
result of lower outstanding balances on various notes and loans payable to banks
and to two of our principal stockholders, Robert B. Little and Ellen Dinerman
Little (together, the "Littles").

As a result of the above, we had a loss before income tax of $1,988,568
for the year ended December 31, 1999, compared to an income before income taxes
of $112,472 for the year ended December 31, 1998.

We recorded income tax benefits of $736,000 for the year ended December
31, 1999, reflecting a 37.0% effective tax rate, compared to a tax provision of
$53,000 for the year ended December 31, 1998.

As a result of the above, we had a net loss of $1,252,569 for the year
ended December 31, 1999, compared to net income of $59,472 for the year ended
December 31, 1998.

Year ended December 31, 1998 compared to year ended December 31, 1997

Revenues increased by $3,091,220 (13.7%) to $25,585,476 for the year
ended December 31, 1998, compared to $22,494,256 for the year ended December 31,
1997. The increase in revenues was due in part to the license of North and Latin
American rights to Waking Ned Devine for $5,000,000 and to increased U.S.
theatrical revenues of $1,005,131 for the year ended December 31, 1998, compared
to $358,081 for the year ended December 31, 1997, primarily resulting from our
release of Mrs. Dalloway through First Look Pictures in February 1998.

Film costs as a percentage of revenues decreased to 82.1% for the year
ended December 31, 1998, compared to 85.1% for the year ended December 31, 1997.
The decrease was primarily due to fewer write-downs to net realizable value of
film costs in the year ended December 31, 1998 as compared to the year ended
December 31, 1997. We had write-downs of approximately $1,205,123 for the year
ended December 31, 1998, compared to approximately $1,926,506 for the year ended
December 31, 1997. Selling, general and administrative expenses, net of amounts
capitalized to film costs, decreased by $548,739 (15.6%) to $2,960,383 for the
year ended December 31, 1998, compared to $3,509,122 for the year ended December
31, 1997. We capitalize some of our overhead costs incurred in connection with
our acquiring rights to a motion picture by adding these costs to the
capitalized film costs of the motion picture. Decreases in selling, general and
administrative expenses over those in the prior year included decreases in:

o payroll related expenses of $514,566;
o accounting expenses of $108,045;
o legal expenses of $67,411;
o business entertainment expenses of $52,548; and
o costs associated with a sales consultant based in Italy of
$40,066.

These decreases were partially offset by increases in selling, general
and administrative expenses over those in the prior year, including increases
in:

o contract labor of $108,337;
o rent of $36,707;
o communication expenses of $36,456; and
o bad debt expense of $28,017.

Other expenses increased by $828,329 (123.7%) to $1,497,893 for the
year ended December 31, 1998, compared to $669,564 for the year ended December
31, 1997. This increase was primarily the result of increased interest expense
of $1,644,153 for the year ended December 31, 1998, compared to $853,666 for the
year ended December 31, 1997. Interest expense for the year ended December 31,
1998 increased over the prior year primarily as the result of less interest
being capitalized to film costs.

As a result of the above, we had net income before income taxes of
$112,472 for the year ended December 31, 1998, compared to a loss, before tax
benefit of $837,277, for the year ended December 31, 1997.

We recorded a tax provision of $53,000 for the year ended December 31,
1998, reflecting a 47.1% effective tax rate, compared to a tax benefit of
$293,357 for the year ended December 31, 1997, resulting from the expected
future tax benefit of recognizing the reported loss for such year for tax
purposes. The tax benefit for the year ended December 31, 1997 was calculated
reflecting an effective tax rate of 35.0%.

As a result of the above, we had net income of $59,472 for the year
ended December 31, 1998, compared to a net loss of $543,920, for the year ended
December 31, 1997.

Liquidity and Capital Resources

We require substantial capital for the acquisition of film rights, the
funding of distribution costs and expenses, the payment of ongoing overhead
costs and the repayment of debt. The principal sources of funds for our
operations has been cash flow from operations, bank borrowings and equity
financings.

June 2000 Private Placement

In June 2000, we consummated a private placement with Rosemary Street
Productions, LLC ("Rosemary Street"), in which we sold to Rosemary Street for an
aggregate cash purchase price of $17,000,000:

o 5,097,413 shares of our common stock;

o 904,971 shares of our Series A preferred stock, each share of
which is convertible into two shares of common stock and votes
with the common stock on an as-converted basis; and

o five-year warrants to purchase up to 2,313,810 shares of our
common stock at an exercise price of $3.40 per share.

As a result of the June 2000 private placement, Rosemary Street now
owns approximately 59.5% of our voting securities.

Chase Facility

Concurrently with the consummation of the June 2000 private placement,
we, as borrower, and certain of our subsidiaries, as guarantors, entered into a
$40 million credit facility (of which $33 million has been committed) with Chase
and other commercial banks and financial institutions. A portion of the proceeds
from this new credit facility were used to refinance outstanding loans and
accrued interest under our previous credit facility with Coutts & Co. and
Bankgesellschaft Berlin A.G. (formerly known as Berliner Bank A.G. London
Branch). The remaining proceeds will be used to finance our production,
acquisition, distribution and exploitation of feature length motion pictures,
television programming, video product and rights and for working capital and
general corporate purposes.

Under the Chase facility, we borrow funds through loans evidenced by
promissory notes. The loans are made available through a revolving line of
credit which may be reduced, partially or in whole, at any time and is to be
fully paid on June 20, 2005. The Chase facility also provides for letters of
credit to be issued from time to time upon our request.

The Chase facility bears interest, as we may select, at rates based on
either the LIBOR or a rate per annum equal to the greater of (a) the Prime Rate,
(b) the Base CD Rate plus 1% and (c) the Federal Funds Effective Rate plus 1/2%
(as these terms are defined in the credit agreement). In addition to an annual
management fee, there is a commitment fee of 1/2 of 1% per year on the average
daily amount by which the lender's commitment, as such commitment may be reduced
in accordance with the credit agreement, exceeds the sum of the principal
balance of such lender's outstanding loans plus a pro-rata share of the total
face amount of letters of credit issued to us. We also are required to pay
certain up-front fees based on the total amount of commitments made by each
lender under the agreement. The Chase facility also restricts the creation or
incurrence of indebtedness and the issuance of additional securities.

Note and Debt Contributions

Concurrently with the June 2000 private placement, we entered into a
note and debt contribution agreement with the Littles. Pursuant to the
agreement, the Littles forgave:

o $1,339,037 principal amount and $480,709 of accrued but unpaid
interest on a note issued by us to the Littles as part of the
consideration for our merger with Overseas Private;

o $78,101 of accrued and unpaid interest on loans in the
aggregate principal amount of $400,000 ("P&A Loans") made by
the Littles to us in December 1997 and February 1998, which

were used to provide a portion of the funds required by us for
the print and advertising costs associated with the domestic
theatrical release of Mrs. Dalloway; and

o $125,131 of accrued salaries that we owed to them.

The Littles also contributed $130,000 in cash and 1,588,812 of their
shares of our common stock to our capital and we paid the Littles:

o $135,476 for various reimbursable expenses as provided in
their employment agreements with us;

o $130,000 of the remaining principal balance on the note issued
in connection with our merger with Overseas Private;

o $400,000 representing the aggregate principal amount owed by
us to the Littles under the P&A Loans;

o $564,524 of accrued salaries; and

o $200,000 representing the amount owed by us to the Littles
under a tax reimbursement agreement between us and the Littles
entered into in connection with our merger with Overseas
Private.

Yahoo! Stock Sale

As of September 30, 2000, we had sold all 17,454 shares of Yahoo!
common stock that we received as part of a share-for-share exchange with
broadcast.com, which was subsequently acquired by Yahoo!. Under the terms of the
share-for-share agreement, our Yahoo! shares could not be sold, transferred,
assigned, pledged, hypothecated, or otherwise disposed of on or before July 18,
2000. Similarly, the 562,527 shares of our common stock issued to broadcast.com,
which is now held by Yahoo! are unregistered shares and were restricted for a
similar one year period. On July 19, 2000, we sold 8,727 shares of the Yahoo!
common stock for approximately $1,164,000 and on September 26, 2000, we sold the
remaining 8,727 shares of the Yahoo! common stock for approximately $891,800.

Resources

At September 30, 2000, we had cash and cash equivalents of $893,685,
compared to cash and cash equivalents of $270,031 as of December 31, 1999.
Additionally, at September 30, 2000, we had restricted cash of $21,667 held by
our primary lender, to be applied against the Chase facility. The restricted
cash balance as of December 31, 1999 was $88,176. As of September 30, 2000, we
also had deferred revenue relating to distribution commitments and guarantees
from sub-distributors of approximately $795,000.

We believe that our existing capital, funds from the Chase facility,
funds from our operations and other available sources of capital will be
sufficient to fund our operations for at least the next twelve months.

Certain Pro Forma Effects of the Exchange Offer

The following table presents (i) our historical basic and diluted
per-share earnings for the year ended December 31, 1999, and the nine months
ended September 30, 2000, (ii) the historical per-share book value as of
December 31, 1999 and September 30, 2000, and (iii) the pro forma effect thereon
of the issuance of shares of common stock pursuant to the exchange offer,
assuming 100% of the outstanding warrants are exchanged. All historical
per-share information has been calculated on the basis of 5,990,153 shares and
7,563,508 shares of common stock and all pro forma per-share information has
been calculated on the basis of 6,311,582 shares and 7,884,937 shares of common
stock outstanding at each of, and during the periods ended, December 31, 1999
and September 30, 2000, respectively.

Earnings Per Share

Year Ended Nine Months Ended
December 31, 1999 September 30, 2000
----------------- ------------------

Historical $(.21) $(2.14)

Pro forma $(.20) $(2.05)

Book Value Per Share

Year Ended Nine Months Ended
December 31, 1999 September 30, 2000
----------------- ------------------

Historical $2.22 $1.89

Pro forma $2.11 $1.81

Price Range of Our Common Stock and Warrants

Our common stock and warrants have been quoted on the OTC Bulletin
Board under the symbols "FRST" and "FRSTW," respectively. Prior to that date,
our common stock and warrants were quoted on the OTC Bulletin Board under the
symbols "OSFG" and "OSFGW," respectively. The following table sets forth the
high and low closing bid quotations for the periods indicated. The quotations
represent prices between dealers and do not include retail markups or markdowns
or commissions. They may not necessarily represent actual transactions.

Common Stock Warrants
------------------ ---------------

High($) Low($) High($) Low($)
---- --- ---- ---
1998

First quarter 2-1/2 1-13/16 5/16 1/8

Second quarter 2-1/8 1-21/32 3/16 3/16

Third quarter 2-13/16 2 15/32 1/8

Fourth quarter 2-3/8 1-1/2 7/16 1/6

1999

First quarter 3-1/8 2-1/16 1/2 1/4

Second quarter 2-15/16 2-11/16 1/4 3/16

Third quarter 3-3/8 2-1/4 9/16 1/8

Fourth quarter 2-3/4 2-1/4 5/16 1/8

2000

First quarter 2-7/8 2-1/4 1/4 1/8

Second quarter 2-1/2 2 1/8 1/16

Third quarter 2-1/8 1-3/4 1/8 1/16

Fourth quarter 1-7/8 1-1/2 1/8 1/8

2001

First quarter 1-3/16 3/4 3/64 1/32
(through February 6, 2001)

As of February 6, 2001, there were approximately 17 holders of record
of our common stock, and there were 9,803,906 shares of our common stock issued
and outstanding. As of February 6, 2001, there were approximately 9 holders of
record of our warrants and there were 4,500,000 warrants issued and outstanding.
We believe that there are in excess of 200 beneficial holders of each of our
publicly-traded securities.

On _________, 2001 , the last reported sale price of our common stock
as reported on the OTC Bulletin Board was $_________. On ___________, 2001, the
last reported sale price of our warrants was $_________.

Background of the Exchange Offer

Purpose of the exchange offer

The exchange offer is intended to retire any and all of our public
warrants through the issuance of common stock. This would allow us to:

o simplify our capital structure;

o reduce the potential future dilutive impact on our earnings
per share that could be caused by the warrants; and

o diminish or eliminate any overhang on the common stock price
from the existence of the warrants.

We reserve the right not to proceed with the exchange offer. See "The
Exchange Offer - Conditions of the Exchange Offer."

In the absence of the exchange offer, 4,500,000 shares of common stock
would be issued in exchange for the warrants if all of the currently outstanding
warrants were exercised, resulting in an aggregate of 14,303,906 shares of
common stock outstanding, and we would receive the proceeds of such exercises.
Assuming 100% participation in the exchange offer, 321,429 shares of common
stock would be issued, resulting in an aggregate of 10,125,335 shares of common
stock outstanding, and all of the warrants would be extinguished. The exchange
offer will have no effect on total stockholders' equity (other than transaction
costs).

Interests of certain persons in the exchange offer

We have retained Shochet as our solicitation agent to assist us with
the solicitation and administration of the exchange offer. Shochet is an
affiliate of GKN, the managing underwriter of our initial public offering. In
exchange for its services, we will pay to Shochet a fee of $.02 for each warrant
that is exchanged and reimburse it for all reasonable out-of-pocket expenses
incurred in connection with the exchange offer. We will also indemnify Shochet
against all loss, claim, damage, expense or liability incurred in connection
with the registration statement, subject to several limitations. See "The
Exchange Offer - Payment of Solicitation Fees."

Effects of exchange offer on you, if you participate

If you participate in the exchange offer, you will:

o receive whole shares of common stock for your warrants in
accordance with the 1 for 14 exchange exchange ratio, without
having to make any exercise payments;

o receive a cash payment, without interest, for any fractional
shares of common stock that you would otherwise be entitled to
receive;

o be able to vote the common stock received in the exchange
offer on all matters that may come before the holders of our
common stock;

o be able to receive dividends on such common stock, if any,
when declared and paid by us; and

o participate as a holder of common stock in proceeds from any
liquidation of our company after creditors and preferred
security holders, if any, are paid.

However, if you participate in the exchange offer, you will lose the
right to purchase, at any time until February 16, 2002, a share of common stock
for $5.00, for each warrant held, and may be subject to certain tax consequences
as a result of the exchange offer. See "Background of the Exchange Offer" and
"Certain United States Federal Income Tax Considerations."

Effects of the exchange offer on you, if you don't participate

If you do not participate in the exchange offer, you will retain the
right to purchase, at any time until February 16, 2002, one share of common
stock for $5.00 for each warrant held, subject to our right to redeem the
warrants under certain circumstances. However, you should note, that if the
exchange offer is consummated, we intend to delist the warrants from trading on
the OTC Bulletin Board and to deregister the warrants pursuant to the Exchange
Act. In such event, the trading market for, and the liquidity of an investment
in, the warrants remaining outstanding would be significantly reduced. You will
not have any appraisal or dissenters' rights under Delaware law.

The Exchange Offer

Terms of the exchange offer

We are offering to exchange one share of our common stock for every 14
outstanding warrants tendered and accepted by us for exchange. No fractional
shares of common stock will be issued as a result of the exchange offer. You
will receive cash in lieu of any fractional shares. You will not have appraisal
or dissenters' rights under Delaware Law in connection with the exchange offer.

The exchange offer is made pursuant to the terms and subject to the
conditions set forth in this prospectus and the accompanying letter of
transmittal. This prospectus and the letter of transmittal are being sent to all
persons and entities that, as of ___________, 2001, were registered holders of
our outstanding warrants. Although there is no fixed record date for determining
registered holders of warrants entitled to participate in the exchange offer,
only a holder of warrants who is the registered holder thereof (or such person's
legal representative or attorney-in-fact) at the time of their tender in the
exchange offer or who is a person holding sale and transfer documents with
respect to such warrants from the registered holder thereof at the time of such
tender (which documents are satisfactory to us and our transfer agent), may
participate in the exchange offer.

Although we have has no current plan or intention to do so, we reserve
the right in our sole discretion to purchase or make offers for any warrants
that remain outstanding after the expiration of the exchange offer, subject to
the requirements of Rule 13e-4(f)(6) of the Exchange Act. The terms of any such
purchases or offers could differ from the terms of the exchange offer.

You will not be required to pay brokerage commissions or fees or,
subject to the instructions in the letter of transmittal, transfer taxes with
respect to the exchange of warrants pursuant to the exchange offer. If, however,
shares of common stock issued pursuant to the exchange offer or substitute
certificates evidencing warrants not exchanged are to be delivered to, or are to
be issued in the name of, any person other than the registered warrant holder,
or if tendered warrants are recorded in the name of any person other than the
person signing the letter of transmittal, then the amount of any transfer taxes
(whether imposed on the registered warrant holder or any other person) will be
payable by the tendering warrant holder. See "- Payment of Expenses" below.

Expiration date; extension; termination; amendments

The exchange offer will expire at 5:00 p.m., New York City time, on
______________, 2001, subject to extension by us, in which event the expiration
date shall be the time and date to which the exchange offer has been extended.
We will notify Continental Stock Transfer & Trust Company, the exchange agent
for the exchange offer, of any extension by oral or written notice, and will
make a public announcement thereof by press release, in each case prior to 9:00
a.m., New York City time, on the next business day after the previously
scheduled expiration date.

We reserve the right to:

o delay accepting any warrants for exchange or to extend or
terminate the exchange offer and not accept for exchange any
warrants if any of the events set forth below under the
caption "Conditions of the Exchange Offer" shall have occurred
and shall not have been waived by us, by giving oral or
written notice of such delay or termination to the exchange
agent; or

o amend the terms of the exchange offer in any manner, including
altering the exchange ratio or otherwise changing the
consideration offered in exchange for the warrants in the
exchange offer (provided that any such changed consideration
must be paid with regard to all warrants accepted in the
exchange offer).

If the exchange offer is amended in a manner determined by us to
constitute a material change, we will promptly disclose such amendment in a
manner reasonably calculated to inform the holders of warrants of the amendment
and we, depending upon the significance of the amendment and the manner of
disclosure to the holders of the warrants, will extend if necessary the exchange
offer for a period of time in accordance with Rules 13e-4(d)(2) and 13e-4(e)(2)
under the Exchange Act. These rules have been interpreted by the SEC as
requiring that the minimum period during which the exchange offer must remain
open following an announcement of a material change in the terms of the exchange
offer or information concerning the exchange offer (other than a change in
price, a change in the amount of securities sought, or a change in certain fees)
will depend on the facts and circumstances, including the relative materiality
of such change or information.

If a material change in the exchange offer relates to a change in the
exchange ratio or the solicitation fee to be paid to Shochet in connection with
the exchange offer, Rule 13e-4(f)(1) requires the exchange offer to remain open
for a period of not less than ten business days following the announcement of
any such change if the exchange offer would otherwise expire within such ten
business-day period. For purposes of the exchange offer, "business day" means

any day other than a Saturday, Sunday or federal holiday and consists of the
time period from 12:01 a.m. through 12:00 midnight, New York City time. The
rights reserved by us in this paragraph are in addition to our rights set forth
below under the caption "- Conditions of the Exchange Offer."

Procedure for tendering

Your acceptance of the exchange offer pursuant to the procedure set
forth below will constitute an agreement between you and us in accordance with
the terms and subject to the conditions set forth herein and in the letter of
transmittal.

To be tendered validly, the warrants, together with the properly
completed letter of transmittal (or facsimile thereof), executed by the
registered holder thereof, and any other documents required by the letter of
transmittal, must be received by the exchange agent at the address set forth
below prior to 5:00 p.m., New York City time, on the expiration date. In
addition, prior to such time either:

o the certificates for such warrants must be delivered to the
exchange agent along with the letter of transmittal; or

o such warrants must be tendered pursuant to the procedure for
book-entry tender set forth below and a confirmation of
receipt of such warrants received by the exchange agent.

Alternatively, if time does not permit a holder of warrants to provide
the exchange agent with a letter of transmittal or other required documents
prior to 5:00 p.m., New York City time, on the expiration date, or if
certificate(s) representing such holder's warrants are not available for
delivery, prior to such time, to the exchange agent, a warrant holder desiring
to tender his or her warrants must comply with the guaranteed delivery procedure
set forth below under "Guaranteed Delivery Procedure."

The exchange agent will establish accounts with respect to the warrants
at ----------------------------------------------------------------------------
(collectively referred to as the "Book-Entry Transfer Facilities" or
individually as a "Book-Entry Transfer Facility") for purposes of the exchange
offer within two days after the commencement date of the exchange offer.

Any Eligible Institution (as defined below) that is a participant in
the Book-Entry Transfer Facilities system may make book-entry delivery of the
warrants by causing any of the Book-Entry Transfer Facilities to transfer such
warrants into the exchange agent's account at a Book-Entry Transfer Facility in
accordance with such Book-Entry Transfer Facility's procedure for such transfer.
However, although delivery of the warrants may be effected through timely
confirmation of a book-entry transfer of such warrants into the exchange agent's
account at a Book-Entry Transfer Facility, the letter of transmittal (or
facsimile thereof) together with any required signature guarantee, and any other
required documents must, in any case, be transmitted to and received by the
exchange agent at its address set forth on the back cover page of this
prospectus on or prior to the expiration date, or the guaranteed delivery
procedure set forth below must be complied with. Letters of transmittal and
warrants should not be sent to us.

Signatures on a letter of transmittal or a notice of withdrawal, as the
case may be, must be guaranteed unless the warrants tendered pursuant thereto
are tendered (i) by a registered holder of warrants who has not completed the
box entitled "Special Issuance and Delivery Instructions" on the letter of
transmittal or (ii) for the account of an Eligible Institution (as defined
below). In the event that signatures on a letter of transmittal or a notice of
withdrawal, as the case may be, are required to be guaranteed, such guarantee
must be by a firm that is a member of a registered national securities exchange
or a member of the NASD, a commercial bank or trust company having an office or
correspondent in the United States or that is otherwise an "eligible guarantor
institution" within the meaning of Rule 17Ad-15 under the Exchange Act
(collectively "Eligible Institution").

The method of delivery of warrants and other documents to the exchange
agent is at the election and risk of the holder, but if such delivery is by
mail, it is suggested that the mailing be made sufficiently in advance of the
expiration date to permit delivery to the exchange agent before the expiration
date.

If the letter of transmittal is signed by a person other than a
registered holder of any certificates representing warrants listed thereon, such
warrants must be endorsed or accompanied by appropriate stock powers or other
instruments of transfer satisfactory to us and our transfer agent, in each case
signed exactly as the name or names of the registered holder or holders appear
on such warrants.

If the letter of transmittal or the guaranteed delivery form or any
certificates representing warrants or any stock powers or other transfer
instruments are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing, and,
unless waived by us, proper evidence satisfactory to us of their authority to so
act must be so submitted.

All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered warrants will be resolved by us,
whose determination will be final and binding. We reserve the absolute right to
reject any or all tenders that are not in proper form or the acceptance of which
would, in the opinion of our counsel, be unlawful or violate the regulations of
any national securities exchange or the NASD. We also reserve the right to waive
any irregularities of tender as to particular warrants. Our interpretation of
the terms and conditions of the exchange offer (including the instructions in
the letter of transmittal) will be final and binding. Unless waived, any
irregularities in connection with tenders must be cured prior to the expiration
date. Neither us, the exchange agent, or any other person shall be under any
duty to give notification of any defects or irregularities in such tenders or
incur any liability for failure to give such notification. Tenders of warrants
will not be deemed to have been made until such irregularities have been cured
or waived. Any warrants received by the exchange agent that are not properly
tendered and as to which the irregularities have not been cured or waived will
be returned by the exchange agent to the tendering holder, unless otherwise
provided in the letter of transmittal, as soon as practicable following the
expiration date.

If your warrants are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee and you wish to tender warrants
in the exchange offer, you should contact such registered warrant holder
promptly and instruct such registered warrant holder to tender on your behalf.
If you wish to tender directly, you must, prior to completing and executing the

letter of transmittal and tendering warrants, make appropriate arrangements to
register ownership of the warrants in your own name. You should be aware that
the transfer of registered ownership may take considerable time.

Guaranteed delivery procedure

If you desire to tender your warrants and certificate(s) representing
such warrants are not immediately available, or time will not permit your
certificate(s) or any other required documents to reach the exchange agent
before 5:00 p.m., New York City time, on the expiration date, a tender may be
effected if:

(a) The tender is made by or through an Eligible Institution;

(b) Prior to 5:00 p.m., New York City time, on the expiration
date, the exchange agent receives from such Eligible Institution a properly
completed and duly executed guaranteed delivery form (by facsimile transmission,
mail or hand delivery), setting forth your name and address and the number of
warrants tendered, stating that the tender is being made thereby and
guaranteeing that, within five business days after the expiration date, the
certificate(s) representing such warrants, accompanied by a properly completed
and duly executed letter of transmittal and all other documents required by the
letter of transmittal, will be deposited by the Eligible Institution with the
exchange agent; and

(c) The certificate(s) for all tendered warrants (or a
confirmation of a book-entry transfer of such warrants into the exchange agent's
account at a Book Entry Transfer Facility as described above), as well as a
properly completed and duty executed letter of transmittal and all other
documents required by the letter of transmittal, are received by the exchange
agent within five business days after the expiration date.

Conditions of the exchange offer

We will not be required to accept for exchange, or issue common stock
in exchange for, any warrants tendered. We may terminate or amend the exchange
offer as provided herein, or may postpone (subject to the requirements of the
Exchange Act for prompt exchange or return of the warrants) the acceptance for
exchange of, and exchange of, the warrants tendered, if, at any time on or after
the date of this prospectus and before acceptance for exchange or exchange of
any such warrants, any of the following conditions exist:

o any action or proceeding is instituted or threatened in any
court or by or before any governmental agency or regulatory
authority which challenges the making of the exchange offer or
which might materially impair our ability to proceed with or
consummate the exchange offer or have a material adverse
effect on the contemplated benefits of the exchange offer to
our company; or

o there shall have been proposed, adopted or enacted any law,
statute, rule or regulation which might materially impair our
ability to proceed with or consummate the exchange offer or
have a material adverse effect on the contemplated benefits of
the exchange offer to our company; or

o there shall have occurred:

o any general suspension of, shortening of hours for, or
limitation on prices for, trading in securities on the OTC
Bulletin Board (whether or not mandatory);

o a declaration of a banking moratorium or any suspension of
payments in respect of banks by federal or state authorities
in the United States (whether or not mandatory);

o a commencement of a war, armed hostilities or other
international or national crisis directly or indirectly
involving the United States;

o any limitation (whether or not mandatory) by any governmental
authority on, or other event having a reasonable likelihood of
affecting, the extension of credit by banks or other lending
institutions in the United States;

o in the case of any of the foregoing existing at the time of
the commencement of the exchange offer, a material
acceleration or worsening thereof; or

o any tender or exchange offer with respect to some or all of
the common stock or the warrants (other than the exchange
offer), or a merger, acquisition or other business combination
proposal involving our company, shall have been proposed,
announced or made by any person or entity.

The foregoing conditions are for our sole benefit and may be asserted
by us regardless of the circumstances giving rise to such conditions or may be
waived by us in whole or in part at any time and from time to time. However, if
any of the foregoing conditions shall have occurred, we may:

o terminate the exchange offer and return tendered warrants to
the holders who tendered them;

o extend the exchange offer and retain all tendered warrants,
subject to Rule 13e-4(f)(2) of the Exchange Act (withdrawal
rights), until the expiration of the extended exchange offer;
or

o amend the exchange offer in any respect, including by waiving
such unsatisfied condition and accepting all validly tendered
warrants that have not been withdrawn.

Acceptance of warrants for exchange; Delivery of common stock

Upon the satisfaction or waiver of all of the conditions of the
exchange offer, we will accept all warrants properly tendered and not withdrawn
prior to 5:00 p.m., New York City time, on the expiration date. We will deliver
or cause the exchange agent to deliver shares of common stock issued pursuant to
the exchange offer promptly after the expiration date.

For purposes of the exchange offer, we shall be deemed to have accepted
validly tendered and not withdrawn warrants when, as and if we have given oral
or written notice thereof to the exchange agent. The exchange agent will act as
agent for the tendering holders of warrants for the purposes of receiving the
common stock pursuant to the exchange offer from us. Under no circumstances will
interest be paid by us by reason of any delay in delivering such common stock.

If any tendered warrants are not accepted for exchange because of an
invalid tender, or due to the occurrence of certain other events set forth
herein or otherwise, certificates for any such unaccepted warrants will be
returned, without expense, to the tendering holder thereof (or, in the case of
warrants tendered by book-entry transfer within a Book-Entry Transfer Facility,
credited to an account maintained within such Book-Entry Transfer Facility) as
promptly as practicable after the expiration or termination of the exchange
offer.

Withdrawal rights

If you have tendered warrants, you may withdraw the tender thereof, in
whole or in part, at any time prior to 5:00 p.m., New York City time, on the
expiration date or, unless such tender has been previously accepted for
exchange, at any time after 5:00 p.m., New York City time, on _____________,
2001, by delivery of a written notice of withdrawal to the exchange agent.

To be effective, a written notice of withdrawal (sent by hand,
telegraph or facsimile transmission) must:

o be timely received by the exchange agent at the address set
forth herein;

o specify the name of the person having tendered the warrants to
be withdrawn;

o indicate the certificate number or numbers of the warrants to
which the withdrawal relates;

o specify the number of warrants so withdrawn; and

o be (x) signed by the holder in the same manner as the original
signature on the letter of transmittal (including a guarantee
of signature, if required) or (y) accompanied by evidence
satisfactory to us that the holder withdrawing such tender has
succeeded to registered ownership of such warrants.

Withdrawals of tenders of warrants may not be rescinded, and any
warrants withdrawn will thereafter be deemed not validly tendered for purposes
of the exchange offer; provided, however, that withdrawn warrants may be
re-tendered by again following one of the tender procedures described herein at
any time prior to 5:00 p.m, New York City time, on the expiration date.

All questions as to the validity (including time of receipt) of notices
of withdrawal will be determined by us and our determination will be final and
binding. Neither us, the exchange agent, nor any other person will be under any
duty to give notification of any defects or irregularities in any notice of
withdrawal or incur any liability for failure to give any such notification.

Fractional shares

No fractional shares of common stock will be issued as a result of the
exchange offer. All fractional interests in a share of common stock that you
would be entitled to receive as a result of the exchange offer will be
aggregated and, if after such aggregation a fractional interest in a share of
common stock would result, you will receive, in lieu thereof, an amount in cash
determined by multiplying (i) the fractional interest in the share of common
stock to which you would otherwise be entitled and (ii) the average of the last
sales price for a share of common stock, as reported by the OTC Bulletin Board,
for each of the five trading days (whether or not sales have occurred on such
days) immediately preceding the expiration date.

As soon as practicable after the determination of the amount of cash,
if any, to be paid to you with respect to any fractional share interest, and
promptly after the expiration date, the exchange agent shall distribute in cash
the amount payable to you. Under no circumstances will interest be paid by us by
reason of any delay in making such cash payment.

Transferability of shares of common stock received upon exchange

The issuance of shares of common stock upon exchange of the warrants
pursuant to the exchange offer are being registered under the Securities Act
pursuant to a registration statement of which this prospectus forms a part. As
registered, the shares of common stock issued upon exchange of the warrants will
be freely tradeable under federal law, provided that the person receiving the
shares of common stock issued upon exchange of the warrants is not our
affiliate. If the recipient of the shares of common stock is an affiliate of our
company, the shares of common stock may only be sold pursuant to an effective
registration statement under the Securities Act with respect to such shares of
common stock or an exemption from registration thereunder.

Accounting for the exchange offer

The exchange offer will be accounted for as a purchase of the warrants
into treasury followed by a cancellation of the warrants. As a result, there
will be no impact on total stockholders' equity other than the associated costs
of the exchange offer, which will result in a decrease of additional paid-in
capital. See "Payment of Expenses."

Exchange agent

Our transfer and warrant agent has been appointed as exchange agent for
the exchange offer. All correspondence in connection with tendering and
withdrawal procedures relating to the exchange offer and the letter of
transmittal should be addressed to the exchange agent, as follows:

Continental Stock Transfer & Trust Company
2 Broadway, New York, NY 10004
Attention: Reorganization Department
Telephone: (212)-509-4000 (extension 535)
Facsimile: (212)-509-5150

Payment of solicitation fees

We will pay a solicitation fee of $0.02 per warrant to Shochet for any
warrants tendered and accepted for exchange pursuant to the exchange offer.

Other than the fee to be paid to Shochet, we will not make any payments
to brokers, dealers or others soliciting acceptances of the Exchange Offer. We,
however, will pay the Exchange Agent reasonable and customary fees for its
services and will reimburse the Exchange Agent for its reasonable out-of-pocket
expenses in connection therewith. We will also pay brokers, dealers and other
custodians, nominees and fiduciaries the reasonable out-of-pocket expenses
incurred by them in forwarding copies of this Prospectus and related documents
to the beneficial owners of the Warrants, and in handling or forwarding tenders
to their customers.

In general, the rules of the SEC prohibit any broker-dealer that is
participating in the distribution of securities for or on behalf of us from
making a market in the common stock or warrants during a "restricted period"
commencing up to five days prior to the date that this prospectus is distributed
to warrant holders and extending until completion of the exchange offer.

Payment of expenses

Other than solicitation fees to be paid to Shochet, we will not make
any payments to brokers, dealers or others soliciting acceptances of the
exchange offer. We, however, will pay the exchange agent reasonable and
customary fees for its services and will reimburse it for its reasonable
out-of-pocket expenses in connection therewith. We will also pay broker, dealers
and other custodians, nominees and fiduciaries the reasonable out-of-pocket
expenses incurred by them in forwarding copies of this prospectus and related
documents to the beneficial owners of the warrants, and in handling or
forwarding tenders for their customers.

The cash expenses to be incurred by us in connection with the exchange
offer are estimated in the aggregate to be approximately $200,000, and include

fees and expenses of the exchange agent and information agent, solicitation fees
to the soliciting dealers, printing and miscellaneous expenses and accounting
and legal fees.

We will pay all transfer taxes, if any, applicable to the transfer of
warrants to it or its order pursuant to the exchange offer. If, however, shares
of common stock issued pursuant to the exchange offer or substitute certificates
evidencing warrants not exchanged are to be delivered to, or are to be
registered or issued in the name of, any person other than the registered holder
of the warrants tendered, or if tendered certificates representing warrants are
registered in the name of any person other than the person signing the letter of
transmittal, or if a transfer tax is imposed for any reason other than the
transfer and sale of warrants to us or our order pursuant to the exchange offer,
the amount of any such transfer taxes (whether imposed on the registered holder
or any other person) will be payable by the tendering holder. If satisfactory
evidence of payment of such taxes or exemption therefrom is not submitted with
the letter of transmittal, the amount of such transfer taxes will be billed
directly to such tendering holder.

Use of proceeds

We will not receive any cash proceeds from the issuance of the common
stock offered hereby.

Our Business

General

o action;
o art-house;
o comedy;
o drama;
o foreign language;
o science fiction; and
o thrillers.

We have accumulated a library of distribution rights, including sales agency
rights, in various media and markets to approximately 250 films.

We operate in numerous capacities, including as:

o a foreign sales agent. We license foreign distribution rights
to independently produced films that were fully financed and
are owned by others. In this capacity, we receive sales agency
fees.

o a distributor. We acquire the distribution rights to films for
specified terms, territories and media from independent
producers. In this capacity, we receive distribution fees. In
exchange for these distribution rights, we may commit to pay

the independent producer a minimum guaranteed payment ranging
from approximately $100,000 to $5,000,000 at or after delivery
of the completed film. These minimum guaranteed payments
represent varying portions of the films' production costs,
including, on occasion, substantially all of such cost. These
minimum guaranteed payments may enable the independent
producer to obtain financing for the production and/or
completion of the film. By providing these minimum guaranteed
payments, we are often able to secure more extensive
distribution rights on more favorable terms.

o a producer. We selectively produce motion pictures that we
distribute, generally acquiring fully developed projects ready
for pre-production and contracting out pre-production and
production activities.

Strategic objectives

We seek to become a more significant player in our industry, while at
the same time managing our risk and cash flow so as to be able to effectively
respond to continuing changes in our industry. Our strategy to achieve our
objectives includes:

Creating a television commercial production division. We have
established a television commercial production division called "First Look
Artists." This division seeks to exploit the current trend in the industry of
utilizing talent not typically associated with advertising, such as high-profile
feature film directors. In this regard, we are assembling a roster of
accomplished feature filmmakers who we believe can successfully cross over to
the medium of television commercials. We also believe that we can attract proven
television commercial directors to our division's projects by offering them
access to potential film projects.

Creating a home entertainment division. We have launched a home
entertainment division called "First Look Home Entertainment." This division
directly distributes films on videocassette and DVD. Our premier release was
Quiet Days in Hollywood, starring Academy Award-winner, Hilary Swank. We intend
to release 18 to 24 films into the home entertainment market during the next 12
months.

Creating an Internet entertainment division. We have established an
Internet entertainment division named "First Look Internet." We will utilize our
existing rights to content, relationships and expertise to create and offer
desirable entertainment through the Internet.

Utilizing our recently obtained financial resources to expand our
domestic theatrical distribution activities. We believe there is great
opportunity in the U.S. theatrical distribution market. Though we have had
domestic success with films such as John Sayles' The Secret of Roan Inish and
the Academy Award-winning Antonia's Line, limited financial resources kept us
from becoming a more active player in this area. We intend to utilize our
expanded financial resources, including our Chase facility, to become
increasingly more active in this market. We are currently identifying product
and intend to hire the appropriate staff to supplement our domestic theatrical
distribution operations.

Exploiting our reputation and relationships with foreign sources. We
believe that we enjoy a prominent position in the international independent film
marketplace. We intend to capitalize on our reputation and relationships to

exploit opportunities in the areas of production and acquisition financing,
especially through private equity and European sources. These efforts enable us
to access increasingly higher profile films with commercial potential.

Reducing our risk by limiting our direct investment in acquisition
costs and film production. As part of this strategy, we:

o act as sales agent or license distribution rights for films
that are produced with funds provided by other parties and not
by us; and

o act on behalf of producers to locate and arrange equity
sources, co-production and co-financing sources, pre-sales,
gap financing, insurance backed financing arrangements and
other resources for the production of motion pictures in
exchange for sales and distribution rights to the films and
negotiated fees.

Acquiring films that we believe are likely to merit theatrical release
or are suitable for initial release on pay and basic television. As part of this
strategy, we:

o acquire films that have recognizable casts, directors and
producers and which embody greater production values, which we
believe enhances their audience appeal in the competitive
theatrical market. We attempt to accomplish this by offering
incentives such as greater creative opportunity to talent than
offered by major studios;

o acquire films that are oriented to basic and pay television
programming needs, such as films with lower budgets or which
target specific genres, such as action films; and

o develop relationships with major studios and seek to expand
our executive producing role in connection with motion
pictures that other companies produce and distribute.

The Motion Picture Industry

Generally

The motion picture industry consists of two principal activities:

o production, which encompasses the creation, development and
financing of motion pictures; and

o distribution, which involves the promotion and exploitation of
feature-length motion pictures in a variety of media,
including theatrical exhibition, home video, television and
other ancillary markets, both domestically and
internationally.

The United States motion picture industry is dominated by the major
studios, including The Walt Disney Company, Paramount Pictures Corporation,
Warner Brothers Inc., Universal Pictures, Twentieth Century Fox, Sony Pictures
Entertainment, and MGM/UA. The major studios, which historically have produced
and distributed the vast majority of high-grossing theatrical motion pictures
released annually in the United States, are typically large, diversified

corporations that have strong relationships with creative talent, television
broadcasters and channels, Internet service providers, movie theater owners and
others involved in the entertainment industry. The major studios also typically
have extensive national or worldwide distribution organizations and own
extensive motion picture libraries.

Motion picture libraries, consisting of motion picture copyrights and
distribution rights owned or controlled by a film company, can be valuable
assets capable of generating revenues from worldwide commercial exploitation in
existing media and markets, and potentially in future media and markets
resulting from new technologies and applications. The major studios also may own
or be affiliated with companies that own other entertainment related assets such
as music and merchandising operations and theme parks. The major studios' motion
picture libraries and other entertainment assets may provide a stable source of
earnings which can offset the variations in the financial performance of their
new motion picture releases and other aspects of their motion picture
operations.

During the past 15 years, independent production and distribution
companies, many with financial and other ties to the major studios, have played
an important role in the production and distribution of motion pictures for the
worldwide feature film market. These companies include:

o Miramax Films Corporation, now affiliated with The Walt Disney
Company, which produced Scary Movie, the Scream film series
and Shakespeare in Love;

o New Line Cinema Corporation/Fine Line Features, now affiliated
with Time Warner Entertainment Company, L.P., which produced
the Austin Powers films, The Mask, Teenage Mutant Ninja
Turtles and the Nightmare on Elm Street series;

o October Films, which produced Secrets & Lies and Breaking the
Waves, together with Gramercy Pictures, which produced Dead
Man Walking and Fargo, is part of USA Films and USA Network;

o Orion Pictures, now affiliated with MGM/UA, which produced The
Silence of the Lambs;

o Artisan Entertainment Inc., which distributed The Blair Witch
Project; and

o Lion's Gate Films, which distributed American Psycho, Dogma,
Gods and Monsters and Affliction.

As a result of consolidation in the domestic motion picture industry, a
number of previously independent producers and distributors have been acquired
or are otherwise affiliated with major studios. However, there are also a large
number of other production and distribution companies that produce and
distribute motion pictures that have not been acquired or become affiliated with
the major studios. In contrast to the major studios, independent production and
distribution companies generally produce and distribute fewer motion pictures
and do not own production studios, national or worldwide distribution
organizations, associated businesses or extensive film libraries which can
generate gross revenues sufficient to offset overhead, service debt or generate
significant cash flow.

The motion picture industry is a world-wide industry. In addition to
the production and distribution of motion pictures in the United States, motion

picture distributors generate substantial revenues from the exploitation of
motion pictures internationally. In recent years, there has been a substantial
increase in the amount of filmed entertainment revenue generated by U.S. motion
picture distributors from foreign sources. From 1989 to 1999, international
revenues of motion picture distributors from filmed entertainment grew from
approximately $4.7 billion in 1989 to approximately $30 billion in 1999. This
growth has been due to a number of factors, including the general worldwide
acceptance of and demand for motion pictures produced in the United States, the
privatization of many foreign television industries, growth in the number of
foreign households with videocassette players and growth in the number of
foreign theater screens.

Many countries and territories, such as Australia, Canada, China,
France, Germany, Hong Kong, India, Italy, Russia, Japan, Spain, and the United
Kingdom have substantial indigenous film industries. As in the United States, in
a number of these countries the film industry, and in some cases, the
entertainment industry, in general, is dominated by a small number of companies
that maintain large and diversified production and distribution operations.
However, like in the United States, in most of these countries, there are also
smaller, independent, motion picture production and distribution companies.
Foreign distribution companies not only distribute motion pictures produced in
their countries or regions but also films licensed or sub-licensed from United
States production companies and distributors. In addition, film companies in
many foreign countries produce films not only for local distribution, but also
for export to other countries, including the United States. While some foreign
language films and foreign English-language films appeal to a wide U.S.
audience, most foreign language films distributed in the United States are
released on a limited basis because they draw a specialized audience for which
the appeal has decreased substantially in recent years.

Motion Picture Production

Motion picture production begins with the screenplay adaptation of a
popular novel or other literary work acquired by the producer or the development
of an original screenplay having its genesis in a story line or scenario
conceived by a writer and acquired by the producer. In the development phase,
the producer typically seeks production financing and tentative commitments from
a director, the principal cast members and other creative personnel. A proposed
production schedule and budget also are prepared during this phase.
Pre-production begins upon completing the screenplay and arranging financing
commitments. In this phase, the producer:

o engages creative personnel to the extent not previously
committed;
o finalizes the filming schedule and production budget; obtains
insurance and secures completion guaranties, if necessary;
establishes filming locations and secures any necessary studio
facilities and stages; and
o prepares for the start of actual filming.

Principal photography, which is the actual filming of the screenplay,
generally extends from eight to sixteen weeks for a film produced by a major
studio and for as little as four to eight weeks for low budget films and films
produced by independent production companies. The length of filming depends in
each case upon factors such as budget, location, weather and complications
inherent in the screenplay. Following completion of principal photography, the
film enters the post-production phase. During this phase, the motion picture is

edited, opticals, dialogue, music and any special effects are added, and voice,
effects and music sound tracks and pictures are synchronized. This results in
the production of a negative from which release prints of the motion picture are
made.

Production costs consist primarily of:

o acquiring or developing the screenplay;
o compensating creative and other production personnel;
o film studio and location rentals;
o equipment rentals;
o film stock and other costs incurred in principal photography;
and
o post-production costs, including the creation of special
effects and music.

Distribution expenses, which consist primarily of the costs of
advertising and preparing release prints, are not included in direct production
costs. The major studios generally fund production costs from cash flow
generated by motion pictures and related activities or, in some cases, from
unrelated businesses or through off-balance sheet methods. Substantial overhead
costs, consisting largely of salaries and related costs of the production staff
and physical facilities maintained by the major studios, also must be funded.
Independent production companies generally avoid incurring overhead costs as
substantial as those incurred by the major studios by hiring creative and other
production personnel and retaining the other elements required for
pre-production, principal photography and post-production activities on a
picture-by-picture basis. As a result, these companies do not own sound stages
and related production facilities, and, accordingly, do not have the fixed
payroll, general administrative and other expenses resulting from ownership and
operation of a studio. Independent production companies also may finance their
production activities on a picture-by-picture basis. Sources of funds for
independent production companies include bank loans, pre-licensing of
distribution rights, foreign government subsidies, equity offerings and joint
ventures. Independent production companies generally attempt to obtain all or a
substantial portion of their financing of a motion picture prior to commencement
of principal photography, at which point substantial production costs begin to
be incurred and require payment.

As part of obtaining financing for its films, an independent production
company often is required by its lenders and distributors who advance production
funds to obtain a completion bond or production completion insurance from an
acceptable completion guarantor which names the lenders and applicable
distributors as beneficiaries. The guarantor assures the completion of the
particular motion picture on a certain date. If the motion picture cannot be
completed for the agreed upon budgeted cost, the completion guarantor is
obligated to pay the additional costs necessary to complete the picture by the
agreed upon delivery date. If the completion guarantor fails to timely complete
and deliver the motion picture on or before the agreed upon delivery date, the
completion guarantor is required to pay the lenders and distributor, if
applicable, an amount equal to the aggregate amount the lenders and distributor
have loaned or advanced to the independent producer.

In connection with the production and distribution of a motion picture,
major studios and independent production companies generally grant contractual
rights to actors, directors, screenwriters, owners of rights and other creative
and financial contributors to share in net revenues from a particular motion
picture. Except for the most sought-after talent, these third-party
participations are generally payable after all distribution fees, marketing
expenses, direct production costs and financing costs are recovered in full.

Major studios and independent film companies in the United States
typically incur obligations to pay residuals to various guilds and unions
including the Screen Actors Guild, the Directors Guild of America and the
Writers Guild of America. Residuals are payments required to be made on a
picture-by-picture basis by the motion picture producer to the various guilds
and unions arising from the exploitation of a motion picture in markets other
than the primary intended market. Residuals are calculated as a percentage of
the gross revenues derived from the exploitation of the picture in these
ancillary markets. The guilds and unions typically obtain a security interest in
all of the producer's rights in the motion picture being exploited to ensure
satisfaction of the residuals obligation. This security interest usually is
subordinate to the security interest of the lenders financing the production
cost of the motion picture and the completion bond company guaranteeing
completion of the motion picture. Under a producer's agreement with the guilds
and unions, the producer may transfer the obligation to pay the residuals to a
distributor if the distributor assumes the obligation to make the residual
payment. If the distributor does not assume those obligations, the producer is
obligated to pay those residuals.

Motion Picture Distribution

General

Motion picture distribution involves domestic and international
licensing of the picture for:

o theatrical exhibition;
o videocassettes, laser discs and digital video discs (DVD);
o presentation on television, including pay-per-view, basic and
premium cable, network, syndication or satellite;
o marketing of the other rights in the picture and underlying
literary property, which may include books, CD-ROM,
merchandising and soundtracks;
o non-theatrical exhibition, which includes airlines, hotels and
armed forces facilities; and
o exploitation via the Internet, which is still evolving.

Although releases by the major studios typically are licensed and fully
exploited in all of the foregoing media, films produced or distributed by
independent film companies are often not exploited in all of the media. For
example, some films may not receive theatrical exhibition in the United States
or various other territories and instead may be released directly on home video
or as a pay television premiere or otherwise exploited on a pay television
service. In limited circumstances, these films may then be released in theaters.

Production companies with distribution divisions typically distribute
their motion pictures themselves. Production companies without distribution
divisions may retain the services of sales agents or distributors to exploit the
motion pictures produced by them in selected or all media and territories.
Distribution companies may directly exploit distribution rights licensed to, or
otherwise acquired, by them by booking motion pictures with movie theaters or
selling videocassettes to video retailers. Alternatively, they may grant
sub-licenses to domestic or foreign sub-distributors to exploit completed motion
pictures in particular territories or media.

Acquisition of distribution rights

A sales agent does not generally acquire distribution rights from the
producer or other owner of rights in the motion picture. Instead, he acts as an
agent for the producer or rights owner, licensing the distribution rights to
distributors on behalf of the producer or rights owner in exchange for a sales
agency fee. This fee typically is computed as a percentage of gross revenues
from licenses obtained by the sales agent. A distributor generally licenses and
takes a grant of distribution rights from the producer or other rights owner of
the motion picture for a specified term in a particular territory or territories
and media, generally in exchange for a distribution fee calculated as a
percentage of gross revenues generated by the distributor's exploitation of the
motion picture. The distributor may agree to pay the producer of the motion
picture an advance or a minimum guarantee upon the delivery of the completed
motion picture. This amount is to be recouped by the distributor out of revenues
generated from the exploitation of the motion picture in particular media or
territories. After receiving its ongoing distribution fee and recouping the
advance or minimum guarantee plus its distribution costs, the distributor
generally pays the remainder of revenues in excess of an ongoing distribution
fee to the producer of the motion picture.

Obtaining license agreements with a distributor or distributors prior
to completion of a motion picture which provide for payment of a minimum
guarantee is often referred to as the pre-licensing or pre-selling of film
rights. This pre-selling may enable the producer to obtain financing for its
project by using the contractual commitment of the distributor to pay the
advance or minimum guarantee as collateral to borrow production funding. In the
past, pre-selling of film rights provided a means for financing film production.
However, the ability to pre-sell film rights in various territories and media,
the amount of pre-sales that can be obtained in certain territories and media
and thus, the percentage of a film's budget that can be covered with pre-sales,
fluctuates. In recent years, independent film companies generally have not been
able to pre-sell as great a percentage of a film's budget as they have in past
years.

The producer also may be able to acquire additional production funds
through gap financing. Although gap financing currently is being made available
by multiple lenders, certain banks have ceased providing this type of financing,
and many banks that provide gap financing are becoming more conservative in
their approach to these lending practices. As a result, there can be no
assurance that lenders will continue to make funds available on this basis. In
some circumstances, the distributor is entitled to recover any unrecouped costs
and advances from a film licensed to the distributor from the revenues from
another film or films also licensed to the distributor. This is commonly known
as cross collateralizing.

In addition to obtaining distribution rights in a motion picture for a
limited duration, a distributor also may acquire all or a portion of the
copyright in the motion picture or license certain distribution rights in
perpetuity. Both major studios and independent film companies often acquire
motion pictures for distribution through a customary industry arrangement known
as a negative pickup, under which the studio or independent film company agrees
to pay a specified minimum guaranteed amount to a production company in exchange
for all rights to the film upon completion of production and delivery of the
film. The production company normally finances production of the motion picture
pursuant to financing arrangements with banks and other lenders in which the
lender receives an assignment of the production company's right to payment of
the minimum guarantee and is granted a security interest in the film and in the
production company's rights under its arrangement with the studio or independent

film company. When the major studio or independent film company picks up the
completed motion picture, it pays the minimum guarantee or assumes the
production financing indebtedness incurred by the production company in
connection with the film. In addition, the production company is paid a
production fee and generally is granted a participation in net revenues from
distribution of the motion picture.

The distribution cycle

Concurrently with their release in the United States, motion pictures
typically are released in Canada and also may be released in one or more other
international markets. Generally, a motion picture that is released theatrically
is available for distribution in other media during its initial distribution
cycle as follows:

Number of months
following initial
Marketplace (Media) Domestic theatrical release
------------------ ---------------------------
Domestic theatrical --
Domestic international --
Domestic home video and DVD (initial release) 4-6 months
Domestic pay-per-view 6-9 months
International home video and DVD (initial release) 6-12 months
Domestic pay television 9-10 months
International television (pay or free) 18-24 months
Domestic free television (network, barter syndication,
syndication and basic cable) 30-33 months

Films often remain in distribution for varying periods of time. For
example, major studio motion pictures that are released theatrically can play in
theaters for several weeks following their initial release or, at times,
including in the case of successful art-house films that are released on a
limited basis, for several months. On the other hand, unsuccessful films may
play in theaters for only a short period of time. Once released on
videocassette, a motion picture may remain available on videocassette for many
years. Similarly a motion picture can be licensed to various forms of television
for many years after its first release. The release periods set forth above
represent standard holdback periods. A holdback period represents a stipulated
period of time during which release of the motion picture in other media is
prevented to allow the motion picture to maximize its value in the media in
which it is currently being released. Holdback periods are often specifically
negotiated with various distributors on a media-by-media basis. However, the
periods set forth above represent our estimate of typical current holdback
periods in the motion picture industry.

In general, if a film is not released theatrically in the United States
and is instead first released on domestic home video, television exploitation
does not commence until four to eight months after the video release.
Thereafter, the same general release patterns indicated in the table above
typically apply. If a film premieres on United States pay television, the pay
television service is typically licensed for a four to six week exclusive airing
period. The license generally will provide for limited airings made up of five
to eight exhibition days with multiple airings permitted on each exhibition day.
The provisions of the license also usually provide for the pay television
service to receive subsequent airing periods following a period in which the
film can be released on video or sometimes even theatrically and a period during
which the film may be broadcast on free television.

A substantial portion of a film's ultimate revenues are generated in
its initial distribution cycle. The initial distribution cycle usually consists
of the first five years after the film's initial domestic release and includes
theatrical, video, and pay and free television. Commercially successful motion
pictures, however, may continue to generate revenues after the film's initial
distribution cycle from the re-licensing of distribution rights in certain media
and from the licensing of distribution rights with respect to new media and
technologies and in emerging markets. Although there has been a substantial
increase over the past fifteen years in the revenues generated from the
licensing of rights in ancillary media such as home video, DVD, cable and
pay-per-view, the theatrical success of a motion picture remains a significant
factor in generating revenues in foreign markets and in other media such as
video and television. For example, retail video stores currently purchase fewer
copies of videocassettes of motion pictures that have not been theatrically
released, and purchase more copies of major studio theatrical hits.

Theatrical

The theatrical distribution of a motion picture, whether in the United
States or internationally, involves the licensing and booking of the motion
picture to movie theaters, the promotion of the picture through advertising and
publicity campaigns and the manufacture of release prints from the film
negative. Expenditures on these activities, particularly on promotion and
advertising, are often substantial and may have a significant impact on the
ultimate success of the film's theatrical release. In addition, expenditures can
vary significantly depending upon a number of factors including:

o the markets and regions in which the film is distributed;

o the media used to promote the film such as newspaper,
television and radio;

o the number of screens on which the motion picture is to be
exhibited; and

o the ability to exhibit motion pictures during peak exhibition
seasons.

With a release by a major studio, the vast majority of these costs,
which primarily consist of advertising costs, are incurred prior to the first
weekend of the film's domestic theatrical release. Accordingly, there is not
necessarily a correlation between these costs and the film's ultimate box office
performance. In addition, the ability to distribute a picture during peak
exhibition seasons, including the summer months and the Christmas holidays, and
in the most popular theaters, may affect the theatrical success of a picture.
Films distributed theatrically by an independent film company are sometimes
released on a more limited basis which allows the distributor to defer marketing
costs until it is able to assess the initial public acceptance of the film.

While arrangements for the exhibition of a film vary greatly, there are
certain economic relationships generally applicable to theatrical distribution.
Theater owners retain a portion of the admissions paid at the box office,
typically referred to as gross box office receipts. The share of the gross box
office receipts retained by a theater owner generally includes a fixed amount
per week, in part to cover overhead, plus a percentage of receipts that usually
increases over time. Although these percentages vary widely, a theater owner's
share of a particular film's revenues will normally be approximately 60% to 65%
of gross box office receipts. The balance of the gross box office receipts,

referred to as gross film rentals, is paid to the distributor. The distributor
then retains a distribution fee, which is typically 30-35%, from the gross film
rentals. This percentage is used to recover the costs incurred in distributing
the film, which consist primarily of marketing and advertising costs and the
cost of release prints for exhibition. The balance of gross film rentals, after
deducting distribution fees and distribution costs recouped by the distributors,
is then applied against the recoupment of any advance paid for the distribution
rights plus interest and the balance is paid to the producer or other rights
owner of the film.

Home video

A motion picture released theatrically typically will become available
for videocassette distribution within four to six months after its initial
domestic theatrical release. Certain films are not initially released
theatrically but may instead be released directly to home video. Given the
increasing preference of retail video stores for successful theatrical releases,
it has become increasingly difficult to secure the initial release of a film
directly to home video, and the economic opportunity for the films where a home
video release is obtained has greatly diminished.

Home video distribution consists of the promotion and sale of
videocassettes to local, regional and national video retailers that rent or sell
videocassettes to consumers primarily for home viewing. Most films are initially
made available in videocassette form at a wholesale price of approximately $50
to $75 per videocassette and are sold at that price to wholesalers. The
wholesalers then resell the videocassette to video rental stores at a price of
approximately $75 to $105 per videocassette. Following the initial marketing
period, selected films may be remarketed at a wholesale price of $10 to $15 or
less for sale to consumers. These sell-through arrangements are used most often
with films that will appeal to a broad marketplace or to children. A few major
releases with broad appeal may be initially offered by a film company at a price
designed for sell-through rather than rental when it is believed that the
ownership demand by consumers will result in a sufficient level of sales to
justify the reduced margin on each cassette sold. In the past, owners of films
did not share in rental income. However, video distributors have recently begun
to enter into revenue sharing arrangements with certain retail stores. Under
these arrangements, videocassettes are sold at a reduced price to video rental
stores, usually $8 to $10 per videocassette, and a percentage of the rental
revenue is then shared with the owners or licensors of the films. Home video
arrangements in international territories are similar to those in domestic
territories except that the wholesale prices may differ.

Television

Television rights for films initially released theatrically that have
broad appeal generally are licensed:

o first to pay-per-view for an exhibition period within six to
nine months following initial domestic theatrical release;

o then to pay television approximately 12 to 15 months after
initial domestic theatrical release;

o thereafter in certain cases to network television for an
exhibition period; and

o then to pay television again.

These films are then syndicated to either independent stations or basic
cable outlets. Pay-per-view allows subscribers to pay for individual programs.
Pay television allows cable television subscribers to view such services as
HBO/Cinemax, Showtime/The Movie Channel, Encore Media Services or others offered
by their cable system operators for a monthly subscription fee. Pay-per-view and
pay television are now delivered not only by cable, but also by satellite
transmission, and films are usually licensed in both of these media. Films that
are not initially released in the domestic theatrical market may premiere
instead on pay television followed in some limited circumstances by theatrical
release. Groups of motion pictures often are packaged and licensed as a group
for exhibition on television over a period of time and, therefore, revenues from
these television licensing packages may be received over a period that extends
beyond the initial distribution cycle of a particular film. Motion pictures also
are licensed and packaged by producers and distributors for television broadcast
in international markets by government or privately owned television studios and
networks. Pay television is less developed outside the United States, but is
experiencing significant international growth. The prominent foreign pay
television services include Canal+, Premiere, STAR TV, British Sky Broadcasting
and the international operations of several U.S. cable services, including HBO,
the Disney Channel and Turner Broadcasting.

Non-theatrical and other rights

Films may be licensed for use by airlines, schools, public libraries,
community groups, the military, correctional facilities, ships at sea and
others. Music contained in a film may be licensed for sound recording, public
performance and sheet music publication. Rights in motion pictures may be
licensed to merchandisers for the manufacture of products such as toys,
T-shirts, posters and other merchandise. Rights also may be licensed to create
novels from a screenplay and to generate other related book publications, as
well as interactive games on platforms such as CD-ROM and CD-I.

Our Motion Picture Distribution

International distribution

Our management has considerable expertise in international
distribution. Robert B. Little, our co-chairman of the board and president, has
substantial experience in licensing motion pictures for distribution outside the
United States and has been active in international motion picture sales since
1975. Over the past 25 years, he has developed relationships with distributors
in most territories through our foreign sales activities. In addition, we are a
founding member of the American Film Marketing Association, which sponsors the
American Film Market. The American Film Market, along with the Cannes Film
Festival and MIFED, are the major annual international film markets that are
attended by distributors worldwide. We participate annually with a sales office
at all three major film markets, as well as three major television and two major
video markets. We also attend many film festivals throughout the world including
Sundance, the Toronto Film Festival and others. From time to time, we also may
engage independent representatives to assist us in acquiring and licensing
motion picture rights.

We license distribution rights internationally in various media such as
theatrical, video, pay television, free television, satellite and other rights
to foreign sub-distributors on either an individual rights basis or grouped in
combinations of rights. We license these rights to sub-distributors in
international territories either on a picture-by-picture basis or pursuant to

output arrangements. Currently, our most important international territories are
Australia, the Benelux countries, Canada, France, Germany, Italy, Japan,
Scandinavia, Spain and the United Kingdom. South Korea also has been an
important territory to us.

The terms of our license agreements with foreign sub-distributors vary
depending upon the territory and media involved and whether the agreement
relates to a single or multiple motion pictures. Most of our license agreements
provide that we will receive a minimum guarantee from the foreign
sub-distributor with all or a majority of the minimum guarantee paid prior to,
or upon delivery of, the film to the sub-distributor for release in the
particular territory. The remainder of any unpaid minimum guarantee generally is
payable at specified intervals after delivery of the film to the
sub-distributor. The minimum guarantee is recovered by the sub-distributor out
of the revenues generated from exploitation of the picture in the territory. The
foreign sub-distributor retains a negotiated distribution fee, generally
measured as a percentage of the gross revenues generated from its distribution
of the motion picture, recovers its distribution expenses and the minimum
guarantee and ultimately pays us the remainder of any receipts in excess of the
distributor's ongoing distribution fee. We must rely on the foreign
sub-distributor's ability to successfully exploit the film in order to receive
any proceeds in excess of the minimum guarantee.

We occasionally do not receive a minimum guarantee from the foreign
sub-distributor and instead negotiate terms which usually result in an
allocation of gross revenues between the sub-distributor and us. Typically, the
terms of these types of arrangements provide for the sub-distributor to retain
an ongoing distribution fee, calculated as a percentage of the sub-distributor's
gross receipts in the territory, recover its expenses and pay remaining receipts
in excess of the ongoing distribution fee to us. Alternatively, often with
respect to video rights, the terms may provide for a royalty to be paid to us
calculated as a percentage of the sub-distributor's gross receipts from
exploitation of the video rights without deduction for the sub-distributor's
distribution expenses.

At times, we enter into output arrangements with local foreign
distributors whereby the foreign sub-distributor receives the right, typically
for a specified period and number of motion pictures, to distribute motion
pictures that we have released in a particular territory and designated media.
In some circumstances, the foreign sub-distributor pays us a minimum guarantee
on a picture-by-picture basis with each minimum guarantee having been either
pre-negotiated or computed as a stipulated percentage of the production or
acquisition cost of each picture.

Domestic distribution

In addition to obtaining foreign distribution rights, we have been
active in acquiring domestic distribution rights. We exploit our domestic
distribution rights in a variety of ways. In 1993, we established First Look
Pictures, our domestic theatrical releasing operation and in 1999 we began
releasing films directly on video. Not all of the films we license or distribute
receive domestic theatrical release by First Look Pictures. We may license films
initially to pay television services for premiere on pay television, including
cable and satellite. We license some films to domestic television broadcasters
for release initially on television. We also license to third party
distributors, such as Fox Searchlight, who may release theatrically. During 2000
we acquired domestic distribution rights to seventeen films. We theatrically

released two of these films during 2000 and expect to release three more of
these films during 2001. We licensed one film to a third party domestic
distributor for theatrical and other exploitation, seven films were or are
intended to be released straight to video and three films will either be
released first on television or on video.

We currently license our domestic video rights to films on a
film-by-film basis or in small groupings of films to various sub-distributors,
including Blockbuster, Inc., USA Films and Winstar TV & Video. In addition, we
have broadened First Look Pictures' role in the video market. We released 15
films on video in 2000. We will continue to evaluate the benefits of having
First Look Pictures release films on video itself on a film-by-film basis in
order to maximize the value of our growing film library.

We license distribution rights directly to pay television services
including HBO, Showtime and Encore, as well as smaller services, pay-per-view
services and basic cable services, including USA, Lifetime, Bravo and the
Independent Film Channel. Although we have not engaged in significant licensing
or syndication of domestic free television rights except as part of a license of
rights in multiple media, we control these rights to a significant portion of
the films in our library and have licensed these rights in certain films to
third parties.

In some cases, we will license the right to distribute a film
domestically in multiple media to a major studio, a division of a major studio
or an independent distributor. Although the terms of these licenses vary, we
typically will be paid a minimum guarantee. The sub-distributor then retains a
distribution fee, measured as a percentage of the gross receipts received by the
sub-distributor from exploitation of the film, recovers its distribution costs
and the advance paid to us, and ultimately pays us the remainder of any receipts
in excess of an ongoing distribution fee.

We do not always receive a minimum guarantee from the licensing of
distribution rights to foreign and domestic sub-distributors. This has caused us
to rely more heavily on the actual financial performance of the film being
distributed. In some circumstances, whether we receive a minimum guarantee
depends upon the media. For example, in the case of motion pictures that have
not been theatrically released, we are increasingly entering into video
distribution arrangements with sub-distributors where no minimum guarantee is
paid to us or where the minimum guarantee paid to us is significantly less than
those paid to us for similar films in the past. In addition, even if we do
obtain minimum guarantees from our sub-distributors, the minimum guarantees do
not assure the profitability of our motion pictures or our operations.
Additional revenues may be necessary from distribution of a motion picture in
order to enable us to recover any investment in the motion picture in excess of
the aggregate minimum guarantees obtained from sub-distributors, pay for
distribution costs, pay for ongoing acquisition and development of other motion
pictures by us and cover general overhead. While the pre-licensing of
distribution rights to sub-distributors in exchange for minimum guarantees may
reduce some of our risk from unsuccessful films, it also may result in us
receiving lower revenues with respect to highly successful films.

First Look Pictures

Some of the motion pictures for which we control domestic rights are
directly distributed to theaters throughout the United States through First Look
Pictures. During 1999, First Look Pictures released two films. During 2000,
First Look Pictures released three films and broadened the release of one film
initially released in December 1999. Although some of First Look Pictures'
future releases may appeal to a wide audience, many of the First Look Pictures'
releases to date have been foreign language and art-house films intended to
appeal primarily to sophisticated audiences.

We believe that we can benefit in several ways by theatrically
distributing films in the United States directly through First Look Pictures.
The domestic theatrical success of a motion picture can be a significant factor
in generating revenues from its distribution in ancillary media and foreign
markets. For example, retail video stores purchase few copies of videocassettes
of motion pictures that have not been theatrically released. In addition, we
believe we are generally able to obtain more favorable distribution terms in our
agreements with foreign and domestic sub-distributors in other media with
respect to motion pictures that have been theatrically released in the United
States. We also believe that, in some cases, First Look Pictures' operations
enable us to achieve domestic theatrical release for films that might not
otherwise be released in U.S. theaters. In addition, we believe that our ability
to release a film theatrically in the U.S. enables us to attract more
recognizable talent, higher profile producers and more promising motion picture
projects for both domestic and foreign distribution and that by theatrically
releasing films ourselves in the United States, we can retain a significantly
greater share of the revenue from domestic media in the event of a highly
successful theatrical release.

Films distributed theatrically in the United States by First Look
Pictures typically have been released on a limited basis to initially less than
100 screens and in selected cities, expanding to new cities or regions based
upon the performance of the film. Some films that are released in new cities as
prints become available from cities where the engagement has closed, reducing
the number of prints needed and the aggregate cost of the prints. We may release
appropriate films with more mass market appeal on a wide release basis either
through First Look Pictures or, more likely, by licensing the film to a domestic
distributor with more significant financial and distribution resources.

The cost to First Look Pictures to distribute a specialized motion
picture or art-house film on a limited-release basis has typically ranged from
approximately $100,000 to $2,000,000. Expenditures for prints, marketing and
advertising represent a substantial portion of the costs of releasing a film. In
connection with the acquisition of domestic theatrical rights to a film, we
occasionally commit to spend no less than a specified minimum amount for prints
and advertising costs. These costs are in addition to the direct production or
acquisition costs and other distribution expenses of the films.

Generally, in addition to receiving a distribution fee, we are entitled
to recover our print and advertising expenditures. Although First Look Pictures
may at times utilize standard broadcast television advertising, First Look
Pictures typically supports its limited releases with local newspaper and, in
certain instances, some cable television advertising. First Look Pictures also
relies on local and national publicity, such as reviews or articles in local and
national publications and appearances of a film's principal artists on radio and

television talk shows. In contrast, distributors of national, wide release films
rely primarily on national advertising campaigns, including substantial
television advertising, to attract theatergoers.

The success of a domestic theatrical release by First Look Pictures can
be affected by a number of factors outside our control. These factors include:

o audience and critical acceptance;

o the availability of motion picture screens;

o the success of competing films in release;

o awards won by First Look Pictures' releases or that of its
competition;

o inclement weather; and

o competing televised events such as sporting and news events.

As a result of the foregoing, and depending upon audience acceptance of
the films distributed through First Look Pictures, we expect that in some cases
we may not recover all of our distribution expenses or derive any profit solely
from domestic theatrical distribution revenue of First Look Pictures' releases.
In addition, we cannot assure you that total revenues from any First Look
Pictures' release, including revenues derived from the film in ancillary media
and international markets, will be sufficient to allow us to recover all of our
costs or to realize a profit.

From January 1, 1999 through December 31, 2000, First Look Pictures
released the five motion pictures listed in the following chart.

Title Major Creative Elements Storyline Release Date
----- ----------------------- ---------- ----------------

Marcello Mastroianni: Director: Anna Maria Tato A documentary about Released in August 1999
I Remember Marcello Mastroianni's
memories, joy of
living, and love of
cinema recorded by his
companion during the
shooting of his last
movie Voyage Au Debut
du Monde

A Map of the World Producers: Kathleen Kennedy and A journey to discover December 1999 for a one
Frank Marshall (The Sixth Sense, the meaning of week Oscar qualifying run
The Color Purple, E.T.) friendship, the and then re-released in
Director: Scott Elliott strength of family and January 2000
Cast: Sigourney Weaver (the the power of forgiveness
Alien Series, Gorillas in The
Mist, Working Girl), Julianne
Moore (The End of The Affair,
Boogie Nights), Chloe Sevigny,
(Boys Don't Cry, The Last Days
of Disco)

Continued on next page
50

(Continued)

Title Major Creative Elements Storyline Release Date
----- ----------------------- ---------- ----------------

The Opportunists Executive Producer: Jonathan An ex-con is having a
Demme (Philadelphia, That Thing hard time making ends
You Do) meet and an alleged
Director: Myles Connell long-lost Irish cousin
Cast: Christopher Walken convinces him to go
(The Deer Hunter, Pulp Fiction), along on one more heist
Peter McDonald (Felicia's Summer 2000
Journey), Cyndi Lauper (Mrs.
Parker and the Vicious Circle)

Ratchatcher Executive Producer: Andrea Portrait of an October 2000
Calderwood impoverished Glasgow
Director: Lynne Ramsay, Jr. community in the 1970s
Cast: William Eadie, Tommy through the eyes of a
Flanagan, Mandy Matthews 12-year old boy

Me and Isaac Newton Executive Producer: Michael Jody A documentary in which November 2000
Patton seven scientists
Director: Michael Apted explain their work and
Cast: Gertrude Ellon, Ashok the roles that
Gadgil, Michio Kaku creativity and
invention play in their
research

Anticipated Releases

Title Major Creative Elements Storyline Release Date
----- ----------------------- ---------- ----------------

Chopper Executive Producer: Al Clark Standover man, June 2001
Director: Andrew Dominik underworld executioner
Cast: Eric Bana and inventive
raconteur, Mark
`Chopper' Read is
Australia's most
infamous criminal and
best-selling author.
This is the story.

A Question of Faith Executive Producer: Edward R. In the heart of May 2001
Pressman California wine country
Director: Tim Disney lies a monastery where
Cast: Martha Hackett, Bernard centuries-old
Hill traditions of ritual,
discipline and solitude
create a timeless
Serenity-until one
dazzling moment changes
Everything.

(Continued on next page)

(continued)

Anticipated Releases
--------------------

Title Major Creative Elements Storyline Release Date
----- ----------------------- ---------- ----------------

Bread & Tulips Producer: Daniele Maggioni Vacationing alone in June 2001
(Pane e Tulipani) Director: Silvio Seldini Venice, Italy, a woman
Cast: Lucia Maglietto, Bruno rediscovers her past
Ganz, Giuseppe Battiston and the freedom of a
forgotten life.
But when her
husband hires an
inept detective
to find her,
hilarity and
poignancy ensues
in this romantic
comedy.

We cannot assure you that the motion pictures scheduled for release by
First Look Pictures in 2001 or any motion pictures thereafter will actually be
released or released in accordance with our anticipated schedule. The motion
picture business is subject to numerous uncertainties, including financing
requirements, personnel availability and the release schedule of competing
films.

Our Acquisition of Rights, Production and Financing

We acquire sales and distribution rights from a wide variety of
independent production companies and producers. We generally acquire these
rights to single films, as compared to acquiring films pursuant to multi-picture
acquisition agreements with independent film companies or producers. We commit
to acquire rights to motion pictures at various stages in the completion of a
film, from films completed and ready for release to developed or undeveloped
film projects for which we may arrange financing or production services to
complete. In acquiring rights, we generally seek to obtain rights to
commercially appealing motion pictures with substantially lower direct negative
costs than motion pictures released by the major studios.

In order to fund the acquisition costs of the films for which we
acquire rights, we have primarily relied on:

o the film facilities provided under our previous credit
facility with Coutts & Co.;

o other lenders willing to finance our contractual minimum
guarantee obligations to the films' producers or rights
owners;

o working capital;

o pre-sales;

o gap financing;

o insurance backed financing structures; and

o other third party equity sources such as private investors.

The films that we sell, license and distribute generally have direct
negative costs ranging from $1,000,000 to $7,000,000. We may acquire rights to
finance or produce motion pictures with direct negative costs and marketing

costs below or substantially in excess of the average direct negative costs and
marketing costs of the films that we have distributed. As part of our overall
business strategy, we intend to emphasize films with more recognizable cast,
directors and producers and greater production values and which may accordingly
have broader appeal in the competitive theatrical market. We also will attempt
to limit our exposure with respect to production and acquisition costs through
gap financing, insurance-backed financing structures and accessing equity
sources such as private investors.

We sometimes acquire limited distribution or sales rights and acquire
worldwide rights, at times including the copyright, to the films. Generally,
this depends upon whether we agree to pay the producer or other rights owner a
substantial minimum guarantee. As part of our acquisition of theatrical, video
and television distribution rights, we may obtain the right to exploit ancillary
rights, such as music or sound track rights, merchandising rights, or rights to
produce CD-ROMs or other interactive media products. Although we may license
these rights to sub-distributors, we historically have not derived any
significant revenues from these ancillary rights.

We occasionally are appointed as the sales agent for a particular
motion picture to license, on behalf of the rights owner, distribution rights in
the film to various distributors for exploitation on a territory-by-territory
basis. This often occurs in conjunction with gap financing or insurance backed
financing arrangements. When we act as a sales agent, we generally are entitled
to a sales agency fee which typically ranges from approximately 10% to 20% of
the gross revenues from resulting licenses or sales. However, this fee may be
higher or lower depending upon the film. We generally advance limited funds
toward the marketing and distribution of the film which generally range from
$50,000 to $150,000. In various arrangements, a portion or all of the sales
agency fee and some or all of the distribution expenses may be deferred as part
of the sales agency arrangement until a specified level of revenues from sale
and licensing of the particular distribution rights is achieved.

We also may act in much the same manner as a sales agent but, rather
than licensing the distribution rights of a particular film to a third party on
behalf of the rights owner, we license the distribution rights in the film from
the rights owner and sub-license those rights to distributors in various
territories. We then exploit the distribution rights for a given term in a given
territory or territories and media. The fee structure and funds provided for
marketing and distribution remain similar to that of a sales agency. As part of
the changes in our operational strategy implemented in 1998, we have acted in
this manner, or as a sales agent, more frequently than in prior years.

In both a sales agency arrangement and the distribution arrangement
described above, the amounts payable by us to the rights owner depend upon our
success in licensing the film and the financial performance of the film itself.
In acquiring distribution rights to a completed or incomplete film, however, we
may agree to pay the rights owner a minimum guarantee that is independent of the
financial performance of the film. Historically, the minimum guarantees paid by
us have ranged from approximately $100,000 to $5,000,000, although in some
circumstances they may exceed these amounts. Depending upon the particular
arrangement, a minimum guarantee may be payable in full at the time of delivery
of the completed film or in installments following complete delivery of the
film. The rights owner also may receive additional payments as a result of our
exploitation of the distribution rights to the film. After receiving a
distribution fee and recovering our distribution expenses and minimum guarantee,
we pay the remainder of revenues in excess of an ongoing distribution fee to the
rights owner.

We typically receive a larger share of gross receipts from the license
and distribution of motion pictures for which we have provided a minimum
guarantee than from those that we do not. At times, the minimum guarantee paid
by us may represent all or a substantial portion of the film's production costs.
In those circumstances, we generally receive worldwide distribution rights in
all media and generally will also obtain ownership of the copyright to the film,
with the production company from which we acquired the rights receiving a
production fee and generally a participation in net revenues from distribution
of the motion picture. As part of the changes in our operational strategy
implemented in 1998, we did not provide any minimum guarantees which represented
the majority of the final production costs of a film or for which we otherwise
financed all or substantially all of the film's production costs in 1999. We
currently intend to become more active in providing minimum guarantees. However,
we expect to limit the number of films for which we provide minimum guarantees
and do not plan on providing minimum guarantees which represent all or
substantially all of a film's production costs.

Our commitment to pay a minimum guarantee with respect to films that
have not begun production often enables the production company or producer to
obtain financing for its project, if needed. In some cases, our contractual
commitment to pay a minimum guarantee upon delivery of a film serves as
sufficient collateral for a bank to lend production funds. The bank typically
will insure delivery of the film to us by requiring the producer to purchase a
completion guaranty. To enable the production company or producer to borrow
production funding, or to borrow at preferential bank fees and interest rates,
we also may have to secure our purchase or acquisition commitment, which we
generally have done by obtaining the issuance of a letter of credit from our
lenders. In some situations, the production company or producer of a film
initially may obtain funds from:

o other distribution companies that obtain distribution rights
in specified media or territories, for example, the domestic
distribution rights or distribution rights in Germany or the
United Kingdom;

o accessing foreign governmental film industry incentive
programs such as programs offered in the past by the Isle of
Man, the United Kingdom, Canada, Australia and New Zealand; or

o by using its own resources or other resources available to it,
and subsequently approaching us to supply the remaining funds
necessary to complete or co-finance the film in exchange for
our obtaining the remaining distribution rights to the motion
picture.

We have not been actively involved in co-financing arrangements.
However, we intend to increase our participation in these arrangements. When we
participate in co-financing arrangements, we will commit to fund a portion of a
particular film's production costs in combination with other equity providers.
We also intend to further develop relationships with major studios and expand
our executive producing role in connection with motion pictures produced and
distributed by other companies.

In June 2000, we entered into a "first look" agreement with The Little
Film Company, Inc. and Ellen Dinerman Little. Under this agreement, we will have
an exclusive "first look" on any project that The Little Film Company owns or

controls or which it has the right to submit to us or any project that it has
the right to acquire or may wish to acquire to development or production.

In connection with the securities purchase with Rosemary Street in June
2000, Rosemary Street assigned to us a first look agreement with Grandview
Pictures LLC and Jon Kilik. The agreement provides for a three-year term ending
in May 2002, which we may renew for an additional two year term. We have the
right to terminate the agreement at any time upon three months prior written
notice. Under the agreement, we pay to Grandview Pictures:

o annual overhead for its New York office, including an annual
salary for Jon Kilik; and

o fees for Kilik's production services based on the cash budget
of the applicable pictures.

We also will compensate Grandview Pictures for each theatrical or
television motion picture produced by Kilik. We will have an exclusive "first
look" on any project that Grandview Pictures wants to produce and which it owns
or controls or which it has the right to submit to us under the agreement or
which it has the right to acquire or may wish to acquire for development and/or
production, or has been authorized by third parties to submit to us for
development and/or production as a feature length theatrical motion picture or
television production.

We did not produce any of the films which we distributed in 1999 or
2000, and we currently do not have any plans to produce motion pictures in 2001.
When we have produced a film, our production subsidiaries typically have
obtained production financing by obtaining production loans using our minimum
guarantee commitment as collateral, at times secured by a letter of credit
issued under our credit facilities. We attempt to minimize the risks associated
with any development and production activities that we conduct in a variety of
ways. We do not maintain a substantial staff of creative or technical personnel.
We also do not own or operate sound stage and related production facilities and,
accordingly, do not have the fixed payroll, general and administrative and other
expenses resulting from such ownership. In addition, in those circumstances
where we produce a film, we generally attempt to acquire fully developed
projects ready for pre-production with, when feasible, completed scripts,
directors and cast members who are committed to or are interested in the
project. Many projects also have a producer involved or committed. However, if
at the time of our acquisition of rights in a project, a producer is not
formally or informally committed to a project, we may also engage a production
services company or a producer to supervise and arrange all pre-production,
production and post-production activities in exchange for a production fee and a
participation in net revenues from the film.

The following chart provides information regarding completed motion
pictures first made available to us for distribution during 1999 other than
those films described under "- Our motion picture distribution-First Look
Pictures." The chart includes acquisitions of rights from unaffiliated
production companies or other rights owners, as well as from production
companies owned or controlled by us.

Motion Picture Title Genre Territories Acquired Selected Cast
-------------------- ----- -------------------- -------------

Esmeralda Comes By Night Romantic Comedy Universe excluding the United Maria Rojo, Claudio
States, Canada, Latin America, Obregon, Martha Navarro
Spain and Portugal

Just One Night Romantic Comedy Universe, excluding the United Timothy Hutton (Ordinary
States and Canada People, Taps), Maria
Grazia Cucinotta (World
Is Not Enough, Il Postino)

Lovers' Prayer Drama Universe Kristen Dunst (Interview
with the Vampire, Wag the
Dog), Nick Stahl (The
Thin Red Line, Disturbing
Behavior) Julie Waters
(Educating Rita, Prick up
Your Ears)

Made Men Action Universe excluding United James Belushi (Wag the
States, Canada, Japan and Germany Dog, Last Action Hero),
Timothy Dalton (James
Bond Series)

My Five Wives Comedy Universe Rodney Dangerfield
(Caddyshack, Back to
School)

The Night Flier Horror United Kingdom, South Africa and Miguel Ferrer (Robocop),
Latin America Julie Entwisle (In & Out)

Partners Thriller Universe Casper Van Dien (Starship
Troopers, Sleepy Hollow)

The Secret Life of Girls Comedy Universe Linda Hamilton (The
Terminator Series,
Dante's Peak), Eugene
Levy (American Pie,
Splash)

Titus Drama Universe Anthony Hopkins (Silence
of the Lambs, Nixon,
Remains of the Day),
Jessica Lange (Blue Sky,
Tootsie), Alan Cumming
(Eyes Wide Shut,
Goldeneye, Emma)

Our Film Library of Distribution Rights

Our film library consists of rights to a broad range of films, most of
which were produced since 1980. At December 31, 2000, we had various
distribution rights to more than 230 motion pictures, including more than 80
motion pictures in which we own an interest in the copyright and approximately
65 motion pictures for which we act as sales agent on behalf of the producer or
other rights owner in the film. Our distribution rights generally range from 12
to 25 years or more from the date of acquisition, and typically extend to many,
if not all, media of exhibition worldwide or in specified territories.

In addition to exploitation of distribution rights to motion pictures
in our library in the major media, we are able to exploit various ancillary
rights in the films under certain situations. We have arranged for the music in
several motion pictures we have distributed to be released as soundtrack
recordings, including Waking Ned Devine, A Merry War, Mrs. Dalloway, The Secret
of Roan Inish, Party Girl, The Big Squeeze and Infinity. Although exploitation
of these soundtracks and other ancillary rights have not generated significant
revenues for us to date, our ownership or control of ancillary rights to motion
pictures in our library, including interactive rights, remake rights and
merchandising rights, may provide future sources of additional revenues.

Additionally, we have granted to Yahoo! the right to exploit on the
Internet approximately fifty titles from our film library on a revenue sharing
basis.

Major customers

In 1997, no customer accounted for more than 10% of our revenues. In 1998,
Fox Searchlight accounted for $5,000,000 or 20.3% of our revenues. In 1999,
Buena Vista accounted for $3,500,000 or 10.4% of our revenues. For the first
nine months of 2000 EMS New Media A.G. accounted for $1,580,000 or 10.4% of our
revenues and Global Media Distributors accounted for $1,650,000 or 10.8% of our
revenues.

Employees

As of February 6, 2001, we employed 46 full-time employees and three
part-time employees. Some of our subsidiaries are or may become subject to the
terms in effect from time to time of various industry-wide collective bargaining
agreements, including the Writers Guild of America, the Directors Guild of
America, the Screen Actors Guild and the International Alliance of Theatrical
Stage Employees. We may assume a production company's obligation to pay
residuals to these various entertainment guilds and unions. A strike, job action
or labor disturbance by the members of any of these entertainment guilds and
unions could have a material adverse effect on the production of a motion
picture within the United States, and, consequently, on our business, operations
and results of operations. These organizations all have engaged in strikes and
similar activities. We believe that our current relationship with our employees
is satisfactory.

Competition

Motion picture distribution, finance and production are highly
competitive businesses. The competition comes both from companies within the

same business and from companies in other entertainment media that create
alternative forms of leisure entertainment. We compete with major film studios
including:

o The Walt Disney Company;
o Paramount Pictures Corporation;
o Universal Pictures;
o Sony Pictures Entertainment;
o Twentieth Century Fox;
o Warner Brothers Inc.; and
o MGM/UA and their affiliates, including previously independent
companies such as Miramax and New Line Cinema which are
dominant in the motion picture industry.

We also compete with numerous independent and foreign motion picture
production and distribution companies. Many of the organizations with which we
compete have significantly greater financial and other resources than we do. For
instance, German-based and multinational production and distribution companies
recently have been successful in raising significant capital in equity
financings in Germany. Our ability to compete successfully depends upon the
continued availability of independently produced, domestic and foreign motion
pictures and our ability to identify and acquire distribution rights to, and
successfully license and distribute, motion pictures with commercial potential.
A number of formerly independent motion picture companies have been acquired in
recent years by major entertainment companies. These transactions have
significantly increased competition for the acquisition of distribution rights
to independently produced motion pictures.

Films that we distribute or finance also compete for audience
acceptance and exhibition outlets with motion pictures that other companies
distribute and produce. As a result, the success of any of the films that we
distribute or finance is dependent not only on the quality and acceptance of
that particular film, but also on the quality and acceptance of other competing
films released into the marketplace at or near the same time. With respect to
our domestic theatrical releasing operations, a substantial majority of the
motion picture screens in the United States typically are committed at any one
time to films distributed nationally by the major film studios, which generally
buy large amounts of advertising on television and radio and in newspapers and
can command greater access to available screens. Although some movie theaters
specialize in the exhibition of independent, specialized motion pictures and
art-house films, there is intense competition for screen availability for these
films as well. Given the substantial number of motion pictures released
theatrically in the United States each year, competition for exhibition outlets
and audiences is intense. In addition, there also have been rapid technological
changes over the past fifteen years. Although technological developments have
resulted in the creation of additional revenue sources from the licensing of
rights with respect to new media, these developments also have resulted in
increased popularity and availability of alternative and competing forms of
leisure time entertainment including pay/cable television programming and home
entertainment equipment such as videocassettes, interactive games and
computer/Internet use.

Regulation

In 1994, the United States was unable to reach an agreement with its
major international trading partners to include audio-visual works, such as
television programs and motion pictures, under the terms of the General

Agreement on Trade and Tariffs Treaty. The failure to include audio-visual works
under the treaty allows many countries to continue enforcing quotas that
restrict the amount of United States-produced television programming which may
be aired on television in those countries. The Council of Europe has adopted a
directive requiring all member states of the European Union to enact laws
specifying that broadcasters must reserve a majority of their transmission time,
exclusive of news, sports, game shows and advertising, for European works. The
directive does not itself constitute law, but must be implemented by appropriate
legislation in each member country. In addition, France requires that original
French programming constitute a required portion of all programming aired on
French television. These quotas generally apply only to television programming
and not to theatrical exhibition of motion pictures, but quotas on the
theatrical exhibition of motion pictures could also be enacted in the future. We
cannot assure you that additional or more restrictive theatrical or television
quotas will not be enacted or that countries with existing quotas will not more
strictly enforce such quotas. Additional or more restrictive quotas or more
stringent enforcement of existing quotas could materially and adversely affect
our business by limiting our ability to fully exploit our rights in motion
pictures internationally and, consequently, to assist or participate in the
financing of these motion pictures.

Distribution rights to motion pictures are granted legal protection
under the copyright laws of the United States and most foreign countries. These
laws provide substantial civil and criminal sanctions for unauthorized
duplication and exhibition of motion pictures. Motion pictures, musical works,
sound recordings, art work, still photography and motion picture properties are
separate works subject to copyright under most copyright laws, including the
United States Copyright Act of 1976, as amended. We are aware of reports of
extensive unauthorized misappropriation of videocassette rights to motion
pictures which may include motion pictures distributed by us. Motion picture
piracy is an industry-wide problem. The Motion Picture Association of America,
an industry trade association, operates a piracy hotline and investigates all
reports of such piracy. Depending upon the results of investigations,
appropriate legal action may be brought by the owner of the rights. Depending
upon the extent of the piracy, the Federal Bureau of Investigation may assist in
these investigations and related criminal prosecutions.

Motion picture piracy is also an international problem. Motion picture
piracy is extensive in many parts of the world, including South America, Asia
including Korea, China and Taiwan, the countries of the former Soviet Union and
other former Eastern bloc countries. In addition to the Motion Picture
Association, 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. In
addition, the United States government has publicly considered trade sanctions
against specific countries that do not prevent copyright infringement of United
States produced motion pictures. We cannot assure you that voluntary industry
embargoes or United States government trade sanctions will be enacted. If
enacted, these actions could impact the amount of revenue that we realize from
the international exploitation of motion pictures depending upon the countries
subject to and the duration of such action. If not enacted or if other measures
are not taken, the motion picture industry as a whole, and our business in
particular, may continue to lose an indeterminate amount of revenues as a result
of motion picture piracy.

The Code and Ratings Administration of the Motion Picture Association
assigns ratings indicating age-group suitability for theatrical distribution of
motion pictures. We sometimes, although not always, submit our motion pictures
for these ratings. In certain circumstances, motion pictures that we did not
submit for rating might have received restrictive ratings, including, in some
circumstances, the most restrictive rating which prohibits theatrical attendance
by persons below the age of seventeen. Unrated motion pictures, or motion
pictures receiving the most restrictive rating, may not be exhibited in certain
movie theaters or in certain locales, thereby potentially reducing the total
revenues generated by these films. United States television stations and
networks, as well as foreign governments, impose additional restrictions on the
content of motion pictures which may restrict in whole or in part theatrical or
television exhibition in particular territories. In 1997, the major broadcast
networks and the major television production companies implemented a system to
rate television programs. This television rating system has not had a material
adverse effect on the motion pictures distributed by us. However, the
possibility exists that the sale of theatrical motion pictures for broadcast on
domestic free television may become more difficult because of potential
advertiser unwillingness to purchase advertising time on television programs
that are rated for limited audiences. We cannot assure you that current and
future restrictions on the content of motion pictures may not limit or adversely
affect our ability to exploit certain motion pictures in particular territories
and media.

Properties

Our principal executive offices are located at 8800 Sunset Boulevard,
Third Floor, Los Angeles, California 90069 and consist of approximately 10,000
square feet of office space. Our payments under the lease are approximately
$20,000 per month. The lease expires on September 30, 2002. Under the terms of
the lease, in October 1999, we became responsible for a percentage of operating
costs above a base year calculation. We do not maintain any studio facilities or
own any real estate, and our lease is with an unaffiliated party.

Legal proceedings

As of February 6, 2001, we were not a party to any material litigation.

Management

Our current directors and executive officers are set forth below.
Biographical information concerning each of the directors and executive officers
is presented on the following pages. Information is presented as of the date of
this prospectus.

Name Age Position
---- --- ---------

Christopher J. Cooney 40 Co-Chairman of the Board and Chief Executive
Officer

Robert B. Little 55 Co-Chairman of the Board and President

William F. Lischak 43 Chief Operating Officer, Chief Financial
Officer, Secretary and Director

Jeffrey Cooney 42 Executive Vice President - Creative Affairs
and Director

Stephen K. Bannon 46 Director

Scot K. Vorse 40 Director

Barry R. Minsky 57 Director

Joseph Linehan 39 Director

Nicholas Bavaro 60 Director

Christopher J. Cooney, 40, has served as co-chairman of our board and
our chief executive officer since June 2000. Since August 1999, Mr. Cooney has
served as president of Rosemary Street Productions LLC, a New York-based
entertainment holding company. Since 1986, Mr. Cooney has served in various
positions at EUE/Screen Gems, Ltd. ("EUE/Screen Gems"), a New York-based
television commercial facility and production house, including as head of
production from 1986 to 1988, as vice president in charge of all facilities from
1988 to 1992, and as vice president of physical production from 1992 to 1996. In
1996, Mr. Cooney led EUE/Screen Gems in the acquisition of DeLaurentis Studios.
Since 1996, Mr. Cooney has been responsible for overseeing all commercial and
daytime television production for the North Carolina operations of EUE/Screen
Gems. Mr. Cooney also holds an ownership interest in EUE/Screen Gems. In 1984,
Mr. Cooney formed Total Picture Company to produce concert films, commercials
and videos for record labels and musical instrument manufacturers. Prior to
that, Mr. Cooney was employed by Independent Artists as an assistant producer of
international television commercials. Mr. Cooney received his B.A. from Boston
University. Christopher J. Cooney is the brother of Jeffrey Cooney, our
executive vice president - creative affairs, and a director of our company.

Robert B. Little, 55, has been president of our company since June 2000
and co-chairman of our board of directors since our merger with Overseas Private
in October 1996. Mr. Little also served as our co-chief executive officer from
October 1996 to June 2000. Mr. Little co-founded Overseas Private in February
1980 and served as chairman of the board of Overseas Private from February 1987
until October 1996 and its chief executive officer from February 1990 until
October 1996. Mr. Little was a founding member of the American Film Marketing
Association, the organization which established the American Film Market, and
served multiple terms on its board of directors. In 1993, Mr. Little served on
the City of Los Angeles Entertainment Industry Task Force, a task force composed
of industry leaders focused on maintaining and enhancing Los Angeles' reputation
as the entertainment capital of the world. Mr. Little is also a founding member
of The Archive Council, an industry support group for the University of
California at Los Angeles Archive Film Preservation Program, and a member of the
board of directors of the Antonio David Blanco Scholarship Fund, an endowment
fund that annually benefits deserving students in the UCLA Department of Film
and Television. Mr. Little was an executive producer of Titus, which was
nominated for an Academy Award(R) in 1999.

William F. Lischak, 43, has served as our chief operating officer,
chief financial officer, secretary and a director of our company since October
1996. Mr. Lischak served as chief operating officer of Overseas Private from
September 1990 until October 1996 and its chief financial officer from September
1988 until October 1996. Mr. Lischak, a certified public accountant, previously
had worked in public accounting, including from 1982 to 1988 with the accounting
firm of Laventhol & Horwath. Mr. Lischak has a masters degree in taxation and
has taught courses in the extension program at UCLA in accounting, finance and
taxation for motion pictures and television. Mr. Lischak attended New York
University's Tisch School of Arts and received a bachelor's degree in business
administration from New York University's Leonard N. Stern School of Business.

Jeffrey Cooney, 42, has served as our executive vice president-creative
affairs and a director of our company since June 2000. Since August 1999, Mr.
Cooney has served as creative director of Rosemary. Mr. Cooney also holds an
ownership interest in EUE/Screen Gems. In 1990, Mr. Cooney formed Jeffrey Cooney
Films and until August 1999 directed commercials for clients such as Kodak,
Mitsubishi, Procter & Gamble and General Mills. Mr. Cooney received a B.A. in
English from Holy Cross College. Jeffrey Cooney is the brother of Christopher J.
Cooney, the co-chairman of our board and our chief executive officer.

Stephen K. Bannon, 46, has been a director of our company since its
inception in December 1993. From October 1996 to June 2000, he served as vice
chairman of our board of directors and chairman of its executive committee. From
December 1993 until October 1996, he served as our chairman of the board. From
June 1991 through July 1998, Mr. Bannon served as the chief executive officer of
Bannon & Co., Inc., an investment banking firm specializing in the
entertainment, media and communications industries. In July 1998, Bannon & Co.,
Inc. was acquired by SG Cowen Securities Corporation, an integrated, full
service U.S. securities and investment banking firm. Mr. Bannon served as
managing director and co-head of SG Cowen Securities Corporation's media and
entertainment group from July 1998 until March 2000. In March 2000, Mr. Bannon
founded and is currently a managing partner of Jefferies Bannon Media Partners
L.L.C. As part of an investment banking assignment, from April 1994 to December
1995, Mr. Bannon served as acting chief executive officer of SBV, a division of
Decisions Investment Corp., which operates the Biosphere 2 project near Oracle,
Arizona. Mr. Bannon is a registered principal with the NASD. Mr. Bannon was an
executive producer of Titus, which was nominated for an Academy Award(R)in 1999.

Scot K. Vorse, 40, became a director of our company in January 1995.
From January 1995 until October 1996, he served as our treasurer and secretary,
and from January 1995 until November 1996, he served as our vice president. From
June 1991 through July 1998, Mr. Vorse served as an executive vice president and
the chief financial officer of Bannon & Co., Inc. After the acquisition of
Bannon & Co., Inc. by SG Cowen Securities Corporation in July 1998, Mr. Vorse
served as managing director and co-head of SG Cowen Securities Corporation's
media and entertainment group until March 2000. Since March 2000, Mr. Vorse has
been managing his personal investments.

Barry R. Minsky, 57, has served as a director of our company since June
2000. Since 1977, Mr. Minsky has served as president of Wharton Capital
Corporation and since 1996 as chief executive officer of Wharton Capital
Partners, Ltd., a New York-based investment banking firm which, along with its
partners, facilitates financing for public companies and institutional clients.
Mr. Minsky has assisted public and private corporations in merger and
acquisition activities, sourcing financing and developing financial strategies.
Mr. Minsky also has experience in music publishing, film libraries, motion
picture production and distribution. Mr. Minsky received a B.S. in economics and
graduated on the dean's list from the Wharton School, University of
Pennsylvania.

Joseph Linehan, 39, has served as a director of our company since June
2000. Mr. Linehan has been employed in various capacities with The Union Labor
Life Insurance Co. since 1984. Since December 1999, Mr. Linehan has served as
vice president-private capital and vice president-securities. From May 1998 to
December 1999, Mr. Linehan served as second vice president-investments and from
February 1993 to May 1998, Mr. Linehan served as assistant vice
president-investments. Mr. Linehan received a B.A. and M.B.A. from the
University of Maryland.

Nicholas Bavaro, 60, has served as a director of our company since June
2000. Mr. Bavaro has served as vice president and chief financial officer of
EUE/Screen Gems since 1983, when Columbia Pictures International ("Columbia")
sold its Screen Gems division. From 1961 to 1983, Mr. Bavaro served in various
positions at Columbia, including as an employee in the financial department from
1961 to 1967, as comptroller of the Screen Gems division from 1967 to 1973 and
as vice president and chief financial officer of that division from 1974 to
1983.

Our board of directors is divided into three classes, each of which
serves for a term of three years, with only one class of directors being elected
in each year. The term of the first class of directors, currently consisting of
William F. Lischak, Joseph Linehan and Barry R. Minsky, will expire at the
annual meeting of our stockholders in 2002. The term of the second class of
directors, currently consisting of Robert B. Little, Stephen K. Bannon and
Christopher J. Cooney, will expire at the annual meeting of our stockholders in
2003. The term of the third class of directors, currently consisting of Scot K.
Vorse, Nicholas Bavaro and Jeffrey Cooney, will expire at the annual meeting of
our stockholders in 2001. In each case, each director serves from the date of
his election until the end of his term and until his successor is elected and
qualifies.

Voting Agreement

In June 2000, our company, Rosemary Street, the Littles, MRCo., Inc., a
member of Rosemary Street ("MRCo."), Christopher J. Cooney and Jeffrey Cooney
entered into a voting agreement, which provides that:

o so long as Robert B. Little is employed as our president, or
the Littles own no less than 5% of our issued and outstanding
voting securities, we will nominate and Rosemary will vote for
Robert B. Little to serve as a member of our board;

o so long as Christopher J. Cooney and Jeffrey Cooney own, in
the aggregate, directly or indirectly, no less than 5% of our
issued and outstanding voting securities, we will nominate and
the Littles and other members of Rosemary will vote for
Christopher J. Cooney and Jeffrey Cooney to serve as members
of our board; and

o so long as MRCo. owns no less than 5% of our issued and
outstanding voting securities, we will nominate and the
Littles and other members of Rosemary will vote for Joseph
Linehan to serve as a member of our board.

The voting agreement further provides that if the size of the board is
increased from nine members to eleven members prior to June 20, 2002, Rosemary
has the right to designate for election or appoint as directors the two persons
to fill the vacancies created by the increase. The Littles have agreed to vote
all of their shares of our voting securities for the election of Rosemary's two
nominees in this situation.

Executive Compensation

The following table sets forth the total compensation paid or accrued
during 1997, 1998 and 1999 to our co-chief executive officers (Ellen Dinerman
Little and Robert B. Little) and to each of our other two most highly
compensated executive officers who earned more than $100,000 in 1999 (William F.
Lischak and MJ Peckos).

Long Term
Compensation
Annual Compensation Awards
----------------------------------------- --------------
Other
All Other
Annual Securities Compen-
Name and Salary Bonus Compensation Underlying Sation
Principal Position Year ($) ($) ($) Options/SARS (#) ($)
--------------------------------- ---------- -------------- ------------ ------------- --------------- -------------

Robert B. Little 1999 125,000(2) 25,000(3) 11,852(4) 0 34,791(5)
Co-chairman of the board and 1998 125,000(6) 25,000(3) 26,985(7) 0 48,101(8)
co-chief executive officer (1) 1997 125,000 27,404(3) 40,511(9) 0 16,695(10)

Ellen Dinerman Little 1999 125,000(2) 25,000(3) 0 0 22,638(12)
Former co-chairman of the 1998 125,000(13) 25,000(3) 17,203(14) 0 19,642(15)
board, co-chief executive 1997 125,000 27,404(3) 27,134(16) 0 23,895(17)
officer and president (11)

William F. Lischak 1999 200,000 50,000 -(22) 10,000 12,528(18)
Chief operating officer, chief 1998 193,209 50,000 -(22) 0 10,677(19)
financial officer and 1997 175,000 53,365 -(22) 0 9,410(20)
secretary

Long Term
Compensation
Annual Compensation Awards
----------------------------------------- --------------
Other
All Other
Annual Securities Compen-
Name and Salary Bonus Compen-sation Underlying Sation
Principal Position Year ($) ($) ($) Options/SARS (#) ($)
--------------------------------- ---------- -------------- ------------ ------------- --------------- -------------

MJ Peckos 1999 150,000 0 -(22) 10,000 5,081(21)
President, domestic 1998 153,224 0 -(22) 0 4,985(21)
distribution and marketing 1997 156,483 20,000 -(22) 0 2,923(21)

-----------------------

(1) Mr. Little was employed by us as our co-chairman of the board and
co-chief executive officer during 1999. In connection with the closing
of the private placement with Rosemary in June 2000, we amended Mr.
Little's existing employment agreement to provide for him to serve as
our co-chairman of the board and president.

(2) Represents salary earned by Mr. Little pursuant to his employment
agreement, the payment of $193,065 of which was made or forgiven in
June 2000.

(3) Includes bonus of $25,000, payment of which was made or forgiven in
June 2000.

(4) Represents $10,987 for automobile lease payments and $865 in automobile
expenses.

(5) Represents $32,480 in life insurance premiums paid or accrued by us for
the benefit of Mr. Little and $2,311 in disability insurance premiums
paid by us for the benefit of Mr. Little.

(6) Represents salary earned by Mr. Little pursuant to his employment
agreement, payment of $68,066 of which was made or forgiven in June
2000.

(7) Represents $11,985 for automobile lease payments, $10,700 in business
management and accounting fees paid by us on behalf of Mr. Little and
$4,300 in business management and accounting fees to which Mr. Little
was entitled to reimbursement, payment of which was made in June 2000.

(8) Represents $2,266 in contributions made by us on behalf of Mr. Little
pursuant to our 401(k) Plan, $34,258 in life insurance premiums paid or
accrued by us for the benefit of Mr. Little, $2,123 in disability
insurance premiums paid by us for the benefit of Mr. Little and $9,454
in tax preparation fees for 1996 for which Mr. Little was entitled to
reimbursement, payment of which was made in June 2000.

(9) Represents $13,499 for automobile lease payments, $25,301 in business
management and accounting fees and $1,711 in automobile expenses paid
by us on behalf of Mr. Little.

(10) Represents $2,625 in contributions made by us on behalf of Mr. Little
pursuant to our 401(k) Plan, $2,131 representing reimbursement of
disability insurance premiums paid by us for the benefit of Mr. Little
and $11,939 in life insurance premiums for which Mr. Little was
entitled to reimbursement, payment of which was made in June 2000.

(11) Ms. Little was employed as the co-chairman of our board and our
co-chief executive officer and president during 1999. In connection
with the June 2000 private placement, we terminated Ms. Little's
employment.

(12) Represents $20,225 in life insurance premiums paid or accrued by us for
the benefit of Ms. Little and $2,413 in disability insurance premiums
paid by us for the benefit of Ms. Little.

(13) Represents salary earned by Ms. Little pursuant to her employment
agreement, payment of $68,063 of which was made or forgiven in June
2000.

(14) Represents $10,700 of business management and accounting fees paid by
us on behalf of Ms. Little, $2,203 in automobile expenses and $4,300 of
business management and accounting fees to which Ms. Little was
entitled to reimbursement, payment of which was made in June 2000.

(15) Represents $2,267 in contributions made by us on behalf of Ms. Little
pursuant to our 401(k) Plan, $15,100 in life insurance premiums paid or
accrued by us for the benefit of Ms. Little and $2,275 in disability
insurance premiums paid by us for the benefit of Ms. Little.

(16) Represents $25,301 of business management and accounting fees paid by
us on behalf of Ms. Little and $1,833 in automobile expenses.

(17) Represents $2,633 in contributions made by us on behalf of Ms. Little
pursuant to our 401(k) Plan, $2,353 representing reimbursement of
disability insurance premiums paid by us for the benefit of Ms. Little
and $18,906 in life insurance premiums for which Ms. Little was
entitled to reimbursement, payment of which was made in June 2000.

(18) Represents $3,569 in contributions made us on behalf of Mr. Lischak
pursuant to our 401(k) Plan, $7,295 in life insurance premiums for
which Mr. Lischak is entitled to reimbursement and $1,664 in disability
insurance premiums paid by us for the benefit of Mr. Lischak.

(19) Represents $3,077 in contributions made by us on behalf of Mr. Lischak
pursuant to our 401(k) Plan, $5,135 for life insurance premiums paid by
us for the benefit of Mr. Lischak and $2,463 for disability insurance
premiums paid by us for the benefit of Mr. Lischak.

(20) Represents $3,256 in contributions made by us on behalf of Mr. Lischak
pursuant to our 401(k) Plan, $4,622 for life insurance premiums paid by
us for the benefit of Mr. Lischak and $1,532 for disability insurance
premiums paid by us for the benefit of Mr. Lischak.

(21) Represents our contributions on behalf of Ms. Peckos pursuant to our
401(k) Plan.

(22) Perquisites with respect to the executive officer did not exceed the
lesser of $50,000 or 10% of the executive officer's salary and bonus.

Compensation Arrangements for Current Executive Officers

Christopher J. Cooney

In June 2000, we entered into an employment agreement with Christopher
J. Cooney, which provides for Mr. Cooney to serve as the co-chairman of our
board and our chief executive officer for a one-year term ending in June 2001.
Mr. Cooney receives a base salary of $200,000 and will receive an annual $25,000
bonus if our pre-tax profits exceed $500,000 in any year during the term. Mr.
Cooney also will be entitled to an additional bonus, if any, as may be
established by the board at the beginning of the employment term based on our
achieving certain profit targets. The agreement contains a non-compete clause
whereby Mr. Cooney agreed not to compete with us for the duration of the
agreement.

Robert B. Little

In June 2000, we entered into an amended and restated employment
agreement with Robert B. Little, which provides for Mr. Little to serve as the
co-chairman of our board and our president for a three-year term ending in June
2003. Mr. Little receives a base salary of $300,000 and a guaranteed bonus of
$50,000, which will be increased by $25,000 on a cumulative basis for each year
of the employment term in which our pre-tax profits exceed $500,000. Mr. Little
also will be entitled to an additional bonus, if any, as may be established by
the board at the beginning of each year of the employment term based on our
achieving certain profit targets. If our pre-tax profits in any two of the three
years of the initial employment term exceed $500,000 or our average pre-tax
profits over the three-year employment term exceed $500,000, Mr. Little's
employment agreement will be automatically renewed on the same terms for an
additional two-year term. Regardless of whether we achieved the profits target,
we may give Mr. Little written notice at least six months prior to the
expiration of the initial employment term that we elect to extend the initial
term for an additional two years. If the initial term is not renewed, Mr. Little
will be entitled to receive $400,000 in cash, payable in six equal monthly
installments of $66,666, with the first payment to be made within 30 days after
termination of the initial term. The agreement contains a non-compete clause
whereby Mr. Little agreed not to compete with us for the duration of the
agreement and for one year after its termination.

William F. Lischak

In June 2000, we entered into an amended and restated employment
agreement with William F. Lischak, which provides for Mr. Lischak to serve as
our chief operating officer and chief financial officer for a three-year term
ending in June 2003. Mr. Lischak receives a base salary of $225,000 and a
guaranteed bonus of $50,000, which will be increased by $15,000 on a cumulative
basis for each year of the employment term in which our pre-tax profits exceed
$500,000. Mr. Lischak also will be entitled to an additional bonus, if any, as
may be established by the board at the beginning of each year of the employment
term based on our achieving certain profit targets. If we achieve these targets,
Mr. Lischak's employment agreement will be automatically renewed on the same
terms for an additional two-year term. Regardless of whether we achieve the
targets, we may give Mr. Lischak written notice at least six months prior to the
expiration of the initial employment term that we elect to extend the initial
term for an additional two years. If the initial term is not renewed, Mr.
Lischak will be entitled to receive $300,000 in cash, payable in six equal
monthly installments of $50,000, with the first payment to be made within 30

days after termination of the initial term. The agreement contains a non-compete
clause whereby Mr. Lischak agreed not to compete with us for the duration of the
agreement and for one year after its termination.

In connection with the June 2000 private placement, we granted Mr.
Lischak an option under our 1996 Basic Stock Option Plan ("Basic Option Plan")
to purchase 75,000 shares of common stock at an exercise price of $3.40 per
share. As of October 13, 2000, 10,427 options were exercisable. 2,083 options
will become exercisable on the last day of each of the next 31 consecutive
months. Once exercisable, the options will remain exercisable until June 2005.

Jeffrey Cooney

In June 2000, we entered into an employment agreement with Jeffrey
Cooney, which provides for Mr. Cooney to serve as our executive vice
president-creative affairs for a three-year term ending in June 2003. Mr. Cooney
receives a base salary of $60,000 and will receive a $25,000 bonus for each year
of the employment term in which our pre-tax profits exceed $500,000. Mr. Cooney
also will be entitled to an additional bonus, if any, as may be established by
the board at the beginning of each year of the employment term based on our
achieving certain profit targets. If we achieve these targets, Mr. Cooney's
employment agreement will be automatically renewed on the same terms for an
additional two-year term. Regardless of whether we achieve the targets, we may
give Mr. Cooney written notice at least six months prior to the expiration of
the initial employment term that we elect to extend the initial term for an
additional two years. If the initial term is not renewed, Mr. Cooney will be
entitled to receive $100,000 in cash, payable in six equal monthly installments
of $16,666.67, with the first payment to be made within 30 days after
termination of the initial term. The agreement contains a non-compete clause
whereby Mr. Cooney agreed not to compete with us for the duration of the
agreement and for one year after its termination.

"First look" agreement with The Little Film Company and Ellen Dinerman Little

Until June 2000, Ellen Dinerman Little was employed as the co-chairman
of our board and our co-chief executive officer and president. In June 2000, our
existing employment agreement with Ms. Little was terminated and we entered into
a "first look" agreement with The Little Film Company and Ms. Little. The
agreement provides for a three-year term ending in June 2003. The Little Film
Company will receive:

o an annual fee of $100,000;

o a discretionary revolving development fund of $100,000 for The
Little Film Company's use in the option/acquisition of
literary properties, engagement of writers and other customary
development costs; and

o customary overhead, including office space, staff, telephone
and reasonable travel costs.

The Little Film Company also will be compensated on a
project-by-project basis. We will have an exclusive "first look" on any project
that The Little Film Company owns or controls or any project that it has the
right to acquire or may wish to acquire for development or production. The
Little Film Company shall furnish us with the services of Ms. Little in

connection with the development and possible production of theatrical motion
pictures based upon accepted artist submissions meeting certain criteria.

Stock Option Plans

We have two stock-based incentive compensation plans for our employees,
directors and other persons who provide services to us: the Amended and Restated
1996 Special Stock Option Plan and Agreement ("Special Option Plan") and the
Basic Option Plan. The plans currently are administered by the compensation
committee to the extent contemplated by the respective plans.

Special Option Plan

The Special Option Plan primarily provides equity incentives to each of
Robert B. Little and Ellen Dinerman Little. Under the Special Option Plan, on
October 31, 1996, each of Ms. Little and Mr. Little was granted two
non-qualified options for a total of 1,100,000 shares of common stock:

o one option to purchase 537,500 shares of our common stock at
an exercise price of $5.00 per share, exercisable on October
31, 1996 for 100,000 shares with the balance vesting in five
equal annual installments beginning on October 30, 1997; and

o one option to purchase 562,500 shares of our common stock at
an exercise price of $8.50 per share, vesting in five equal
annual installments beginning on October 30, 1997.

All 2,200,000 shares of common stock initially reserved for issuance
under the Special Option Plan were subject to the options granted to the
Littles.

In June 2000, the Company amended the Special Option Plan. Pursuant to
this amendment, we cancelled all of the options outstanding under the Special
Option Plan and granted each of Ms. Little and Mr. Little an option to purchase
250,000 shares of common stock at an exercise price of $3.40 per share. The
options are immediately exercisable and expire in June 2005.

Basic Option Plan

Our regular full-time employees, non-employee members of our board of
directors, independent consultants and other persons who provide services to us
on a regular or substantial basis are generally eligible to participate in the
Basic Option Plan. Currently, 550,000 shares of our common stock are reserved
for issuance under the Basic Option Plan. As of October 13, 2000, options to
purchase an aggregate of 259,500 shares of common stock were outstanding under
the Basic Option Plan, with exercise prices ranging from $1.875 to $5.25.

Certain Relationships and Related Transactions

On October 31, 1996, as part of the consideration to them in our merger
with Overseas Private, we issued to the Littles a $2,000,000 secured promissory
note, bearing interest at the rate of 9% per annum, with principal and interest
originally payable in monthly installments of $41,517 over a five-year period
ending October 1, 2001. In connection with the June 2000 Private Placement, the
Littles forgave the principal amount and interest accrued under the note.

The Littles had agreed to defer all payments under the note until
outstanding borrowings under the operating facility portion of our company's
previous credit facility with Coutts & Co. was reduced to at least $5,000,000.
However, a later amendment to the credit facility with Coutts & Co. permitted us
to pay to the Littles an amount equal to their aggregate weekly salary without
interest on a weekly basis towards repayment of the note so long as the Littles
deferred the payments until the deferral lapse date. Pursuant to the note and
debt contribution agreement, we paid the Littles $564,524 in accrued salaries
owed by us to them and the Littles forgave $125,131 of accrued salaries. We also
repaid the Littles $135,476 in expenses owed to them under their respective
employment agreements.

In connection with the merger, we entered into a tax reimbursement
agreement with the Littles and Mr. Lischak. In June 2000, pursuant to the note
and debt contribution agreement, we paid the Littles $200,000, representing the
entire amount owed by us to them under the provisions of the tax reimbursement
agreement.

In December 1997 and February 1998, the Littles loaned us an aggregate
of $400,000 in order to provide a portion of the funds required by us for the
print and advertising costs associated with the domestic theatrical release by
us of Mrs. Dalloway. Pursuant to the note and debt contribution agreement, we
repaid the aggregate principal amount of this loan to the Littles and the
Littles forgave $78,101 of accrued and unpaid interest on the loan.

In October 2000, we entered into a consulting agreement with Wharton
Capital Partners Ltd. ("Wharton"). Barry R. Minsky, a director of our company,
is the chief executive officer and a 50% stockholder of Wharton. The agreement
provides for us to pay Wharton an initial fee of $100,000 upon signing the
agreement and $4,166 per month for a twenty-four month period. If Wharton
introduces us to a financing source and we consummate any public or private
equity and/or debt financing with the source during the term of the consulting
agreement or during the two-year period following the expiration of the
agreement, then we also will pay Wharton an amount equal to (i) 5% of all funds
received by us from such public or private equity financing and (ii) 3% of all
funds received by us from such public or private debt financing. Additionally,
upon completion of an equity-based financing, we will issue to Wharton warrants
to purchase shares of our common stock equal to 5% of the common stock or common
stock equivalents issued in the financing at an exercise price equal to 120% of
the five-day average closing bid price prior to closing of such financing. The
warrants will be exercisable on a cashless basis and will have registration
rights.

Principal Stockholders

The following table sets forth certain information as of February 6,
2001 with respect to the common stock ownership of:

o those persons or groups known to beneficially own more than 5%
of our voting securities;

o each director;

o each executive officer whose compensation exceeded $100,000 in
1999; and

o all current directors and executive officers as a group.

Beneficial ownership is determined in accordance with Rule 13d-3 under the
Securities Exchange Act of 1934. The information concerning the stockholders is
based upon information furnished to us by these stockholders. Except as
otherwise indicated, all of the shares of common stock are owned of record and
beneficially and the persons identified have sole voting and investment power
with respect to the shares. Except as otherwise indicated in the table below,
the business address of each of the persons listed is care of First Look Media,
Inc., 8800 Sunset Boulevard, Third Floor, Los Angeles, California
90069.

Amount and Nature of Percent of Class
Name of Beneficial Owner Beneficial Ownership of Voting Securities
------------------------ -------------------- --------------------

Christopher J. Cooney 7,830,430(1) 59.2%
c/o Rosemary Street Productions, LLC
222 East 44th Street
New York, New York 10017

Robert B. Little 1,864,406(2) 18.1%

William F. Lischak 274,153(3) 2.8%

Jeffrey Cooney
c/o Rosemary Street Productions, LLC 7,830,430(1) 59.2%
222 East 44th Street
New York, New York 10017

Stephen K. Bannon 141,324(4) 1.4%
c/o Jeffries Bannon Media Fund LLC
11100 Santa Monica Blvd.
Los Angeles, California 90025

Scot K. Vorse 146,323(5) 1.4%
1863 Mango Way
Los Angeles, California 90049

Barry R. Minsky
c/o Wharton Capital Partners, Ltd. 985,735(6) 9.8%
545 Madison Avenue
New York, New York 10022

(Continued next page)

(continued)

Amount and Nature of Percent of Class
Name of Beneficial Owner Beneficial Ownership of Voting Securities
------------------------ -------------------- --------------------

Joseph Linehan 0 *
c/o The Union Labor Life Insurance Co.
111 Massachusetts Avenue, N.W.
Washington, DC 20001

Nicholas Bavaro *
c/o EUE/Screen Gems, Ltd.
222 East 44th Street 20,000(7)
New York, New York 10017

Rosemary Street Productions, LLC
222 East 44th Street 7,830,430(8) 59.2%
New York, New York 10017

Dolphin Offshore Partners, L.P. 1,262,500(9) 12.5%
c/o Dolphin Management
129 East 17th Street
New York, New York 10003

Wharton Capital Partners, Ltd. 690,735 7.0%
545 Madison Avenue
New York, New York 10022

Ellen Dinerman Little 1,864,406(2) 18.1%
c/o Sevitsky & Co.
1901 Avenue of the Stars
Suite 1450
Los Angeles, California 90067

MJ Peckos 10,000(10) *

All current executive officers and 11,262,371(11) 79.8%
directors as a group (9 persons)

-----------------------

* Less than 1%

(1) Represents shares of common stock beneficially owned by Rosemary, of
which Christopher J. Cooney is one of the two designated managers and
president and of which Jeffrey Cooney is one of the two designated
managers and creative director.

(2) Represents (i) 1,364,406 shares of common stock held by the Littles as
community property in a revocable living trust, (ii) 250,000 shares of
common stock issuable upon exercise of immediately exercisable options
and (iii) 250,000 shares of common stock issuable upon exercise of
immediately exercisable options granted to such person's spouse which
generally only may be exercised by such person's spouse. Such person
disclaims beneficial ownership of the shares subject to his or her
spouse's options.

(3) Includes 20,427 shares of common stock issuable upon exercise of
immediately exercisable options and 4,166 shares of common stock

issuable upon exercise of options exercisable on or before December 15,
2000. Excludes 60,407 shares of common stock issuable upon exercise of
options that become exercisable in 2001 and 2002.

(4) Includes 20,000 shares of common stock issuable upon exercise of
immediately exercisable options. Excludes 5,000 shares of common stock
issuable upon exercise of options granted on November 15, 2000, which
will become exercisable one year from the date of grant.

(5) Represents (i) 20,000 shares of common stock issuable upon exercise of
immediately exercisable options and (ii) 126,323 shares of common stock
contributed by Mr. Vorse to a revocable living trust for the benefit of
Mr. Vorses spouse. Excludes 5,000 shares of common stock issuable upon
exercise of options granted on November 15, 2000, which will become
exercisable one year from the date of grant.

(6) Represents (i) 690,735 shares of common stock owned by Wharton Capital
Partners Ltd., a New York corporation of which Mr. Minsky holds a 50%
interest and (ii) 295,000 shares of common stock issuable upon exercise
of immediately exercisable warrants, 95,000 of which are held by Mr.
Minsky's spouse. Excludes 5,000 shares of common stock issuable upon
exercise of options that become exercisable in June 2001.

(7) Represents 20,000 shares of common stock issuable upon exercise of
immediately exercisable warrants. Excludes 5,000 shares of common stock
issuable upon exercise of options that become exercisable in June 2001.

(8) Includes (i) 1,809,942 shares of common stock issuable on conversion of
immediately convertible Series A preferred stock and (ii) 1,613,810
shares of common stock issuable upon exercise of immediately
exercisable warrants.

(9) Includes 328,000 shares of common stock issuable upon exercise of
currently exercisable warrants. Information provided herein was
obtained from a Schedule 13D/A, dated December 31, 1998 filed by
Dolphin Offshore Partners, L.P. with the SEC.

(10) Represents 10,000 shares of common stock issuable upon exercise of
immediately exercisable options.

(11) Includes shares referred to as being included in notes 1, 2, 3, 4, 5, 6
and 7. Excludes shares referred to in such notes as being excluded.

Description of Securities

General

We are authorized to issue 25,000,000 shares of common stock, par value
$.001 per share, and 2,000,000 shares of preferred stock, par value $.001 per
share.

Common Stock

Holders of our common stock are entitled to one vote per share on all
matters to be voted on by our stockholders. The holders of our common stock do
not have cumulative voting rights, which means that the holders of more than 50%
of the shares voted can elect all of our directors. Our board of directors is
divided into three classes, which means that only one class of directors is
elected each year. Holders of our common stock are entitled to receive such
dividends, if any, as may be declared from time to time by the board of
directors out of legally available funds. In the event we are liquidated or
dissolved, holders of our common stock are entitled to receive all assets
available for distribution to them. Holders of our common stock have no
preemptive or other subscription rights and there are no conversion rights or
redemption or sinking fund provisions applicable to the common stock. All
outstanding shares of common stock are, and the shares of common stock to be
issued in the exchange offer as set forth in this prospectus will be, validly
issued, fully paid and non-assessable.

Preferred Stock

Our restated certificate of incorporation authorizes us to issue
preferred stock with such designations, rights and preferences as may be
determined by our board of directors. Accordingly, the board of directors is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting or other rights which could adversely affect the
voting power or other rights of the common stock holders. In addition, the
preferred stock could be utilized as a method of discouraging, delaying or
preventing a change in control.

Series A preferred stock

We are authorized to issue 1,100,000 shares of Series A preferred
stock. In June 2000, we sold 904,971 shares of our Series A preferred stock.
Each share of Series A preferred stock is convertible at the holder's option, at
any time prior to October 15, 2001, into two shares of our common stock. On
October 15, 2001, any shares of Series A preferred stock that remain outstanding
will automatically be converted.

The Series A preferred stock ranks senior to our common stock and all
other future capital stock that does not expressly provide for it to be senior
to the Series A preferred stock and ranks equally with all capital stock created
in the future that expressly provides for it to be on parity with the Series A
preferred stock. We are not permitted to issue any senior securities without the
consent of the holders of the Series A preferred stock. The Series A preferred
stock has a liquidation preference over the common stock and holders of the
Series A preferred stock will have pre-emptive rights to maintain their
proportionate economic interest if we sell any additional common stock or
convertible securities.

Holders of the Series A preferred stock are entitled to vote on all
matters on an as-converted basis. In addition, so long as any shares of Series A
preferred stock is outstanding, the affirmative vote of the holders of a
majority of the outstanding shares of Series A preferred stock, voting together
as a single class, will be necessary to (i) amend, alter or repeal any provision
of our restated certificate of incorporation or bylaws so as to adversely affect
the Series A preferred stock; (ii) issue any additional preferred stock or
create, authorize or issue any capital stock that ranks prior, whether with
respect to dividends or upon liquidation, dissolution, winding up or otherwise,
to the Series A preferred stock; or (iii) redeem for cash any junior securities,
subject to certain exemptions.

Warrants

As of February 6, 2001, there were 4,500,000 warrants outstanding that
were issued in connection with our initial public offering. Each of these
warrants entitles the registered holder to purchase one share of our common
stock for $5.00 at any time until February 16, 2002. We may call all of these
warrants for redemption with the consent of GKN Securities Corp., the
underwriter of our initial public offering, at a price of $.01 per warrant at
any time upon not less than 30 days' notice to the warrantholders if the last
sale price of our common stock has been at least $8.50 per share for the 20
consecutive trading days ending on the third day prior to the date on which the
notice of redemption is given.

The exercise price, number of shares of common stock issuable upon
exercise of the warrants and redemption price are subject to adjustment in some
circumstances including a stock dividend, recapitalization, reorganization,
merger or consolidation. However, the warrants are not subject to adjustment for
issuance of common stock at a price below the exercise price of the warrants.

We have the right, in our sole discretion, to decrease the exercise
price of the warrants for a period of not less than 30 days on not less than 30
days' prior written notice to the warrantholders. In addition, we have the
right, in our sole discretion, to extend the expiration date of the warrants on
five business days' prior written notice to the warrantholders.

No fractional shares will be issued upon exercise of the warrants.
However, if a warrantholder exercises all warrants then owned of record by him,
in lieu of the issuance of any fractional shares, we will pay to such
warrantholder an amount in cash based on the market value of our common stock on
the last trading day prior to the date of exercise.

Other warrants

In October 1996, we issued warrants to purchase 62,500 shares of our
common stock. These warrants are exercisable at $5.00 per share and expire on
October 31, 2003.

In connection with the June 2000 private placement, we issued warrants
to purchase 2,313,810 shares of our common stock. We also issued warrants to
purchase 675,000 shares of our common stock to various people and entities in
consideration for their services rendered in connection with the securities
purchase. The warrants are exercisable at $3.40 per share and expire on June 19,
2005.

Anti-takeover effect of various provisions of Delaware corporate law and our
restated certificate of incorporation and bylaws.

Our restated certificate of incorporation, bylaws and sections of
Delaware corporate law contain provisions that may discourage a third party from
pursuing a non-negotiated takeover of our company because they have the effect
of delaying, deterring or preventing a change in our control. These provisions
may have an adverse impact on the price of our securities that are traded in the
public market. Our restated certificate of incorporation authorizes the issuance
of blank check preferred stock with rights and preferences as may be determined
from time to time by our board of directors, without stockholder approval. If
issued, the preferred stock could be utilized as a method of discouraging,
delaying or preventing a change in control even though such an attempt might be
economically beneficial to our stockholders. Our restated certificate of
incorporation also provides for a staggered board of directors. We are subject
to provisions of the Delaware corporate law, which, subject to certain
exceptions, will prohibit us from engaging in any business combination with a
person who, together with affiliates and associates, owns 15% or more of our
common stock for a period of three years following the date that the person
became a 15% or greater stockholder, unless the business combination is approved
in a prescribed manner as was the merger. These provisions of Delaware corporate
law and of our restated certificate of incorporation and bylaws may have the
effect of delaying, deterring or preventing a change in control, may discourage
bids for our common stock at a premium over market price and may adversely
affect the market price, and the voting and other rights of the holders, of our
common stock. In addition, the acceleration of vesting of options granted under
our stock option plans in the event of a change in our ownership or control may
be seen as an anti-takeover provision and may have the effect of discouraging a
merger proposal, a takeover attempt or other efforts to gain control of us.

Certain United States Federal Income Tax Considerations

The following discussion is a general summary of the United States
federal income tax consequences to holders of warrants tendering their warrants
pursuant to the exchange offer. The exchange offer will not affect the United
States federal income tax treatment of holders who do not participate in the
exchange offer. This summary is based on the Internal Revenue Code of 1986, as
amended (the "Code"), applicable Treasury regulations, administrative
pronouncements and judicial decisions, all as in effect and existing on the date
hereof and all of which are subject to change, possibly with retroactive effect.
There can be no assurance that the Internal Revenue Service (the "Service") will
not take a contrary view, and no ruling from the Service has been or will be
sought by the Company.

This summary applies only to those holders who have held our warrants
and will hold our common stock received in exchange therefor as capital assets
pursuant to Section 1221 of the Code, and does not address the federal income
tax consequences to holders who are subject to special rules (such as insurance
companies, financial institutions, tax-exempt organizations and broker-dealers)
or special rules with respect to integrated transactions (such as certain
hedging transactions) or certain straddle transactions.

As used in the discussion which follows, the term "U.S. Holder" means a
beneficial owner of warrants that is:

o a citizen or resident of the United States;

o a corporation, partnership or other entity created or
organized under the laws of the United States or any of its
political subdivisions;

o a trust that (x) is subject to the supervision of a court
within the United States and the control of one or more U.S.
persons or (y) has a valid election in effect under applicable
United States Treasury regulations to be treated as a United
States person; or

o an estate that is subject to U.S. federal income tax on its
income regardless of its source.

The term "Non-U.S. Holder" means a holder of warrants that is, for United States
federal income tax purposes, not a U.S. Holder.

Tax consequences to U.S. Holders

We believe that the exchange of warrants for shares of common stock
pursuant to the exchange offer will be treated as a tax free recapitalization
and will result in the following federal income tax consequences to
participating U.S. Holders of warrants:

o No gain or loss will be recognized on the exchange of their
warrants for shares of common stock pursuant to the exchange
offer, except for any cash received in lieu of a fractional
share of common stock as discussed below;

o The aggregate adjusted basis of the shares of common stock
received in the exchange offer (including any fractional
shares of common stock with respect to which the U.S. Holder
receives cash) will be equal to the aggregate adjusted basis
of the U.S. Holder's warrants exchanged for that common stock;
and

o The holding period for the shares of common stock received in
the exchange offer will include the holding period of the U.S.
Holder's warrants exchanged for the shares of common stock.

Cash Instead of Fractional Shares

The receipt of cash instead of a fractional share of our common stock
will be treated as a taxable disposition of that fractional share interest and
the U.S. Holder will recognize taxable gain or loss for U.S. federal income tax
purposes based upon the difference between the amount of cash received by that
U.S. Holder and the U.S. Holder's adjusted tax basis in the fractional share.
The gain or loss will constitute capital gain or loss and will constitute
long-term capital gain or loss if the U.S. Holder's holding period in the
warrant surrendered in the exchange is greater than 12 months as of the date of
the exchange.

Information reporting and backup withholding

The "backup" withholding and information reporting requirements will
apply to the receipt of cash payments received instead of fractional shares of
common stock upon the exchange of the warrants. We will be required to withhold
tax at a rate of 31% if the U.S. Holder, among other things:

o fails to furnish his or her social security number or other
taxpayer identification number ("TIN") to us;

o furnishes to us an incorrect TIN;

o fails to provide us with a certified statement, signed under
penalties of perjury, that the TIN provided to us is correct
and that the U.S. Holder is not subject to backup withholding;
or

o fails to report properly interest and dividends on his or her
tax return.

A U.S. Holder who does not provide us with his or her correct TIN may be subject
to penalties under the Code. Certain U.S. Holders, including corporations, are
not subject to backup withholding if their exempt status is properly
established.

Backup withholding is not an additional tax. Any amounts withheld under
the backup withholding rules will be allowed as a credit against such holder's
United States federal income tax liability and may entitle such holder to a
refund, provided the required information is furnished to the Service.

Tax consequences to non-U.S. holders

A Non-U.S. Holder similarly will not realize gain or loss on the
exchange of their warrants for shares of our common stock pursuant to the
exchange offer. Furthermore, a U.S. Holder generally will not be subject to
United States federal income tax on any gain realized in connection with the
receipt of cash instead of a fractional share of our common stock pursuant to
the exchange offer, unless (i) (x) the gain is effectively connected with a
trade or business carried on by the Non-U.S. Holder within the United States or
(y) if a tax treaty applies, the gain is attributable to the United States
permanent establishment maintained by the Non-U.S. Holder, (ii) in the case of a
Non-U.S. Holder who is an individual, such holder is present in the United
States for 183 days or more in the taxable year of exchange and certain other
conditions are satisfied or (iii) the Non-U.S. Holder is subject to tax pursuant
to provisions of the Code applicable to United States expatriates.

Information reporting and backup withholding

Delivery to a Non-U.S. Holder of shares of common stock in exchange for
warrants is subject to both backup withholding at the rate of 31% and
information reporting unless the beneficial owner provides us with a completed
IRS Form W-8BEN which certifies under penalties of perjury that such owner is a
Non-U.S. Holder who meets all the requirements for exemption from United States
federal income tax on any gain from the sale or exchange of the warrants.

Backup withholding is not an additional tax. Any amounts withheld under
the backup withholding rules will be allowed as a credit against such non-U.S.
Holder's United States federal income tax liability and may entitle such holder
to a refund, provided the required information is furnished to the Service.

All holders are advised to consult their tax advisors as to the
specific federal, state, local and foreign tax consequences of their
participation in the exchange offer.

Legal Matters

The validity of the common stock offered hereby is being passed upon
for us by Graubard Mollen & Miller, New York, New York.

Experts

The financial statements as of December 31, 1999 and 1998 and for each
of the three years ended December 31, 1999 included in this prospectus have been
included in reliance on the report of PricewaterhouseCoopers LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.

Where You Can Find More Information

We file annual, quarterly and special reports, proxy statements and
other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov. You also may read and
copy any document we file at the SEC's public reference room at 450 Fifth
Street, N.W., Washington, D.C. 20549. These documents are also available at the
public reference rooms at the SEC's regional offices in New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms.

In connection with the exchange offer, we have filed a registration
statement on Form S-4 under the Securities Act of 1933 with the SEC. We have
also filed with the SEC a Schedule TO pursuant to the Securities Exchange Act
of 1934 in connection with the exchange offer. This prospectus is part of the
registration statement and, as permitted by the SEC's rules, does not contain
all of the information included in the registration statement or the Schedule
TO. For further information about us, our securities and the exchange offer, you
may refer to the registration statement, the Schedule TO, and the respective
exhibit and schedules. You can review and copy these documents at the public
reference facilities maintained by the SEC or on the SEC's website as described
above.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20. Indemnification of Directors and Officers

Our restated certificate of incorporation provides that all of our
directors, officers, employees and agents shall be entitled to be indemnified by
us to the fullest extent permitted by law.

Section 145 of the Delaware General Corporation Law concerning
indemnification of officers, directors, employees and agents is set forth below.

"Section 145. Indemnification of officers, directors, employees and
agents; insurance.

(a) A corporation shall have power to indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or 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 the person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or proceeding if the
person acted in good faith and in a manner the 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 the
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 the 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 reasonable cause to believe that the
person's conduct was unlawful.

(b) A corporation shall have power to 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 its favor by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and reasonably incurred by
the person in connection with the defense or settlement of such action or suit
if the person acted in good faith and in a manner the person reasonably believed
to be in or not opposed to the best interests of the corporation and except 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 negligence or
misconduct in the performance of the person's duty to the corporation unless and
only to the extent that the Court of Chancery or the court in which such action
or suit was brought shall determine upon application that, despite the

II-1

adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
the Court of Chancery or such other court shall deem proper.

(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
section, 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.

(d) Any indemnification under subsections (a) and (b) of this
section (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, officer, employee or agent is proper in the circumstances because the
person has met the applicable standard of conduct set forth in subsections (a)
and (b) of this section. Such determination shall be made, with respect to a
person who is a director or officer at the time of such determination, (1) by
the board of directors by a majority vote of a quorum consisting of directors
who were not parties to such action, suit or proceeding, or (2) if such a quorum
is not obtainable, or, even if obtainable, a quorum of disinterested directors
so directs, by independent legal counsel in a written opinion, or (3) by the
stockholders.

(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount if
it shall ultimately be determined that such person is not entitled to be
indemnified by the corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by other employees and agents may be so
paid upon such terms and conditions, if any, as the board of directors deems
appropriate.

(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders 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.

(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
such person and incurred by 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 under this section.

(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and employees
or agents, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent of

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another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under 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.

(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to any employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee or
agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner such person
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
section.

Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors, officers, and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange SEC 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 of expenses incurred or paid by a
director, officer or controlling person in a 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 our counsel the matter has been settled by controlling precedent,
submit to the court of appropriate jurisdiction the question whether 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.

Item 21. Exhibits

Exhibit
Number Description
------- ------------

3.1 Restated Certificate of Incorporation. Incorporated by reference to
Exhibit 3.1 to the Company's Current Report on Form 8-K, dated October
25, 1996, filed with the SEC on November 12, 1996.

3.2 Bylaws, as amended on June 20, 2000. Incorporated by reference to
Exhibit 3.2 to the Company's Amended Current Report on Form 8-K/A,
filed with the SEC on June 29, 2000.

3.3 Certificate of Designations for Series A Preferred Stock. Incorporated
by reference to Exhibit 3.3 to the Company's Amended Current Report on
Form 8-K/A, filed with the SEC on June 29, 2000.

4.1 Form of Common Stock Certificate. Incorporated by reference to Exhibit
4.1 to the Company's Current Report on Form 8-K, dated October 25,
1996, filed with the SEC on November 12, 1996.

4.2 Form of Warrant Certificate. Incorporated by reference to Exhibit 4.2
to the Company's Registration statement on form S-1, Registration No.
33-83624.

II-3

Exhibit
Number Description
------- ------------

4.3 Form of Unit Purchase Option. Incorporated by reference to Exhibit 4.3
to the Company's Registration statement on Form S-1, Registration No.
33-83624.

4.4 Warrant Agreement between Continental Stock Transfer & Trust Company
and the Company. Incorporated by reference to Exhibit 4.4 to the
Company's Registration statement on Form S-1, Registration No.
33-83624.

4.5 Letter agreement, dated October 28, 1996, amending the Unit Purchase
Options. Incorporated by reference to Exhibit 4.5 to the Company's
Current Report on Form 8-K, dated October 25, 1996, filed with the SEC
on November 12, 1996.

4.6 Form of Warrant issued in the Company's bridge financing. Incorporated
by reference to Exhibit 10.4 to the Company's Registration statement on
Form S-1, Registration No. 33-83624.

4.7 Warrant, dated October 31, 1996, for Jefferson Capital Group, Ltd. to
purchase shares of common stock of the Company. Incorporated by
reference to Exhibit 4.6 to the Company's Current Report on Form 8-K,
dated October 25, 1996, filed with the SEC on November 12, 1996.

4.8 Form of Warrant. Incorporated by reference to Exhibit 4.8 to the
Company's Amended Current Report on Form 8-K/A, filed with the SEC on
June 29, 2000.

5.1 Opinion of Graubard Mollen & Miller. To be filed by amendment.

10.1 Secured Promissory Note of the Company, dated October 31, 1996, payable
to Robert B. Little and Ellen Dinerman Little. Incorporated by
reference to Exhibit 10.1 to the Company's Current Report on Form 8-K,
dated October 25, 1996, filed with the SEC on November 12, 1996.

10.2 Indemnity Agreement, dated October 31, 1996, between the Company and
Ellen Dinerman Little. Incorporated by reference to Exhibit 10.2 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.3 Indemnity Agreement, dated October 31, 1996, between the Company and
Robert B. Little. Incorporated by reference to Exhibit 10.3 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.4 Indemnity Agreement, dated October 31, 1996, between the Company and
William F. Lischak. Incorporated by reference to Exhibit 10.4 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

II-4

Exhibit
Number Description
------- ------------

10.5 Indemnity Agreement, dated October 31, 1996, between the Company and
Stephen K. Bannon. Incorporated by reference to Exhibit 10.5 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.6 Indemnity Agreement, dated October 31, 1996, between the Company and
Scot K. Vorse. Incorporated by reference to Exhibit 10.6 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.7 Indemnity Agreement, dated September 3, 1998, between the Company and
Gary Stein. Incorporated by reference to Exhibit 10.7 to the Company's
Current Report on Form 8-K, dated December 31, 1998, filed with the SEC
on April 15, 1999.

10.8 Indemnity Agreement, dated October 31, 1996, between the Company and
Alessandro Fracassi. Incorporated by reference to Exhibit 10.8 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.9 Employment Agreement, dated as of October 31, 1996, between the Company
and Ellen Dinerman Little. Incorporated by reference to Exhibit 10.9 to
the Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.10 Employment Agreement, dated as of October 31, 1996, between the Company
and Robert B. Little. Incorporated by reference to Exhibit 10.10 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.11 Employment Agreement, dated as of October 31, 1996, between the Company
and William F. Lischak. Incorporated by reference to Exhibit 10.11 to
the Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.12 Security Agreement, dated as of October 31, 1996, between the Company
and Ellen Dinerman Little and Robert B. Little. Incorporated by
reference to Exhibit 10.12 to the Company's Current Report on Form 8-K,
dated October 25, 1996, filed with the SEC on November 12, 1996.

10.13 Tax Reimbursement Agreement, dated as of October 31, 1996, between the
Company, Ellen Dinerman Little, Robert B. Little and William F.
Lischak. Incorporated by reference to Exhibit 10.13 to the Company's
Current Report on Form 8-K, dated October 25, 1996, filed with the SEC
on November 12, 1996.

II-5

Exhibit
Number Description
------- ------------

10.14 Promissory Note, dated October 31, 1996, payable to Ellen Dinerman
Little and Robert B. Little. Incorporated by reference to Exhibit 10.14
to the Company's Current Report on Form 8-K, dated October 25, 1996,
filed with the SEC on November 12, 1996.

10.15 Stockholders' Voting Agreement, dated as of October 31, 1996, by and
among the Company, Ellen Dinerman Little, Robert B. Little, William F.
Lischak, Jeffrey A. Rochlis, Barbara Boyle, the Hoberman Family Trust,
John Hyde, Sparta Partners III, Stephen K. Bannon, Scot K. Vorse and
Gary M. Stein. Incorporated by reference to Exhibit 10.15 to the
Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.16 Lock-Up and Registration Rights Agreement, dated as of October 31,
1996, between the Company and Ellen Dinerman Little, Robert B. Little
and William F. Lischak. Incorporated by reference to Exhibit 10.16 to
the Company's Current Report on Form 8-K, dated October 25, 1996, filed
with the SEC on November 12, 1996.

10.17 Non-Competition Agreement, dated as of October 31, 1996, between the
Company and Ellen Dinerman Little. Incorporated by reference to Exhibit
10.17 to the Company's Current Report on Form 8-K, dated October 25,
1996, filed with the SEC on November 12, 1996.

10.18 Non-Competition Agreement, dated as of October 31, 1996, between the
Company and Robert B. Little. Incorporated by reference to Exhibit
10.18 to the Company's Current Report on Form 8-K, dated October 25,
1996, filed with the SEC on November 12, 1996.

10.19 Overseas Filmgroup, Inc. 1996 Special Stock Option Plan and Agreement.
Incorporated by reference to Exhibit 99.1 to the Company's Current
Report on Form 8-K, dated October 25, 1996, filed with the SEC on
November 12, 1996.

10.20 Overseas Filmgroup, Inc. 1996 Basic Stock Option and Stock Appreciation
Rights Plan. Incorporated by reference to Exhibit 10.20 to the
Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1996.

10.21 Agency Agreement, dated as of December 10, 1993, between the Company
and GKN Securities Corp., and amendments thereto (without schedules).
Incorporated by reference to Exhibit 10.1 to the Company's Registration
statement on Form S-1, Registration No. 33-83624.

10.22 Letter Agreement among certain stockholders of the Company, the Company
and GKN Securities Corp. (without schedules). Incorporated by reference
to Exhibit 10.2 to the Company's Registration statement on Form S-1,
Registration No. 33-83624.

II-6

Exhibit
Number Description
------- ------------

10.23 Restated and Amended Syndication Agreement dated as of October 31,
1996, among Coutts & Co., Berliner Bank A.G. London Branch, Overseas
Filmgroup, Inc. and Entertainment Media Acquisition Corporation.
Incorporated by reference to Exhibit 10.25 to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1996.1

10.24 Amendment dated as of April 14, 1998 to Restated and Amended
Syndication Agreement among Coutts & Co., Berliner Bank A.G. London
Branch and Overseas Filmgroup, Inc. Incorporated by reference to
Exhibit 10.26 to the Company's Annual Report on Form 10-K for the year
ended December 31, 1997.

10.25 Loan Out Agreement dated as of March 11, 1996 between the Company and
BLAH, Inc. Incorporated by reference to Exhibit 10.27 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1996.

10.26 Restated Loan Out Agreement dated as of March 11, 1996 between the
Company and BLAH, Inc. Incorporated by reference to Exhibit 10.26 to
the Company's Annual Report on Form 10-K for the year ended December
31, 1997.

10.27 Amendment dated as of April 9, 1999 to Restated and Amended Syndication
Agreement among Coutts & Co., Berliner Bank A.G. London Branch and the
Company. Incorporated by reference to Exhibit 10.27 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1998.

10.28 Agreement dated as of September 12, 1996, between the Company and
Racing Pictures s.r.l. Incorporated by reference to Exhibit 10.28 to
the Company's Annual Report on Form 10-K for the year ended December
31, 1996.

10.29 Option Agreement dated as of September 13, 1996, between Robert B.
Little and the Company. Incorporated by reference to Exhibit 10.29 to
the company's Annual Report on Form 10-K for the year ended December
31, 1996.

10.30 Overseas' Filmgroup Lease Agreement dated April 21, 1987, as amended.
Incorporated by reference to Exhibit 10.30 of the Company's Annual
Report on Form 10-K for the year ended December 31, 1996.

10.31 Amendment, dated April 1, 1997 to Overseas Filmgroup Lease Agreement.
Incorporated by reference to Exhibit 10.31 of the Company's Annual
Report on Form 10-K for the year ended December 31, 1997.
10.32 Loan Agreement dated as of February 15, 1998 between the Company and
Ellen Dinerman Little and Robert B. Little. Incorporated by reference
to Exhibit 10.32 of the Company's Annual Report on Form 10-K for the
year ended December 31, 1997.

10.33 Security Agreement dated as of April 14, 1998, between the Company,
Ellen Dinerman Little, Robert B. Little, Coutts & Co. and Berliner Bank
A.G. London Branch. Incorporated by reference to Exhibit 10.33 to the
Company's Annual Report on Form 10-K, dated December 31, 1998, filed
with the SEC on April 15, 1999.

10.34 Movie and Motion Picture Programming Agreement, dated July 19, 1999,
between broadcast.com inc. and the Company. Incorporated by reference
to Exhibit 10.34 to the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1999.1

10.35 Amendment dated as of April 9, 2000 to Restated and Amended Syndication
Agreement among Coutts & Co., Bankgesellschaft Berlin A.G. and the
Company. Incorporated by reference to Exhibit 10.35 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1999.

10.36 Securities Purchase Agreement, dated May 3, 2000, between the Company
and Rosemary Street Productions, LLC ("Rosemary Street"). Incorporated
by reference to Exhibit 10.35 to the Company's Amended Current Report
on Form 8-K/A, filed with the SEC on June 29, 2000.

1 Confidential Treatment has been granted for portions of such exhibit.

II-7

Exhibit
Number Description
------- ------------

10.37 Assignment and Assumption Agreement between the Company and Rosemary
Street. Incorporated by reference to Exhibit 10.36 to the Company's
Amended Current Report on Form 8-K/A, filed with the SEC on June 29,
2000.

10.38 Amended and Restated 1996 Special Stock Option Plan and Agreement among
Robert Little, Ellen Little and the Company. . Incorporated by
reference to Exhibit 10.37 to the Company's Amended Current Report on
Form 8-K/A, filed with the SEC on June 29, 2000.

10.39 Stock Option Agreement between the Company and William Lischak.
Incorporated by reference to Exhibit 10.38 to the Company's Amended
Current Report on Form 8-K/A, filed with the SEC on June 29, 2000.

10.40 Amended and Restated Employment Agreement between Robert Little and the
Company. Incorporated by reference to Exhibit 10.39 to the Company's
Amended Current Report on Form 8-K/A, filed with the SEC on June 29,
2000.

10.41 Amended and Restated Employment Agreement between William Lischak and
the Company. Incorporated by reference to Exhibit 10.40 to the
Company's Amended Current Report on Form 8-K/A, filed with the SEC on
June 29, 2000.

10.42 Employment Agreement between Christopher Cooney and the Company.
Incorporated by reference to Exhibit 10.41 to the Company's Amended
Current Report on Form 8-K/A, filed with the SEC on June 29, 2000.

10.43 Employment Agreement between Jeffrey Cooney and the Company.
Incorporated by reference to Exhibit 10.42 to the Company's Amended
Current Report on Form 8-K/A, filed with the SEC on June 29, 2000.

10.44 First Look Agreement between The Little Film Company, Inc. and the
Company. Incorporated by reference to Exhibit 10.43 to the Company's
Amended Current Report on Form 8-K/A, filed with the SEC on June 29,
2000.

10.45 Note and Debt Contribution Agreement among Robert Little, Ellen Little
and the Company. Incorporated by reference to Exhibit 10.44 to the
Company's Amended Current Report on Form 8-K/A, filed with the SEC on
June 29, 2000.

10.46 Form of Management Letter between each of Robert Little and Ellen
Little and the Company. Incorporated by reference to Exhibit 10.45 to
the Company's Amended Current Report on Form 8-K/A, filed with the SEC
on June 29, 2000.

10.47 Voting Agreement among the Company, Rosemary Street, Robert Little,
Ellen Little, MRCo., Inc., Christopher Cooney and Jeffrey Cooney.
Incorporated by reference to Exhibit 10.46 to the Company's Amended
Current Report on Form 8-K/A, filed with the SEC on June 29, 2000.

10.48 Form of Credit, Security, Guaranty and Pledge Agreement, dated as of
June 20, 2000, among the Company, as Borrower, the Guarantors named
therein, and the Lenders named therein, with the Chase Manhattan Bank,
as Administrative Agent, and The Chase Manhattan Bank, as Issuing Bank
(without schedules and exhibits). Incorporated by reference to Exhibit
10.47 to the Company's Amended Current Report on Form 8-K/A, filed with
the SEC on June 29, 2000.

10.49 Copyright Security Agreement, dated as of June 20, 2000 (without
schedules and exhibits). Incorporated by reference to Exhibit 10.48 to
the Company's Amended Current Report on Form 8-K/A, filed with the SEC
on June 29, 2000.

10.50 Consulting Agreement, dated October 1, 2000 with Wharton Capital
Partners, Ltd. Incorporated by reference to Exhibit 5 of a Report on
Form 13-D filed by Wharton on November 28, 2000.

21 Subsidiaries of the Registrant. Incorporated by reference to Exhibit 21
to the Company's Annual Report on Form 10-K for the year ended December
31, 1999.

23.1 Consent of PricewaterhouseCoopers LLP. Filed herewith.

23.2 Consent of Graubard Mollen & Miller. To be filed by amendment.

24.1 Power of Attorney. Filed herewith (included on signature page).

II-8

Item 22. Undertakings.

The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment of this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement;

(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement of any
material change to such information in the registration statement;

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(e) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange SEC such indemnification is against public policy expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant 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, the registrant 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.

II-9

(4) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within the
meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus
will contain the information called for by the applicable registration form with
respect to reofferings by persons who may be deemed underwriters, in addition to
the information called for by the other items of the applicable form.

(5) That every prospectus: (i) that is filed pursuant to paragraph (4)
immediately preceding, or (ii) that purports to meet the requirements of Section
10(a)(3) of the Act and is used in connection with an offering of securities
subject to Rule 415, will be filed as a part of an amendment to the registration
statement and will not be used until such amendment is effective, and that, for
purposes of determining any liability under the Securities Act of 1933, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(6) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
form, within one business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt means. This
includes information contained in documents filed subsequent to the effective
date of the registration statement through the date of responding to the
request.

(7) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective.

II-10

Signatures

Pursuant to the requirements of the Securities Act of 1933, as amended
("Act"), the Registrant has duly caused this Registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of Los
Angeles, State of California on February 12, 2001.

FIRST LOOK MEDIA, INC.

By: /s/ William F. Lischak
----------------------------------------------
William F. Lischak, Chief Operating Officer,
Chief Financial Officer and Secretary

Power of Attorney

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints William F. Lischak and Christopher Cooney
his true and lawful attorneys-in-fact and agents, each acting alone, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any or all amendments to this
Registration statement, including post-effective amendments, and to file the
same, with all exhibits thereto, and all documents in connection therewith, with
the Securities and Exchange SEC, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, and hereby ratifies and confirms all that said attorneys-in-fact and
agents, each acting alone, or their substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.

Pursuant to the requirements of the Act, this Registration statement
has been signed by the following persons in the capacities and on the dates
indicated.

Signature Title Date
--------- ----- -----

/s/ Christopher J. Cooney Co-Chairman of the Board, February 12, 2001
--------------------------- Chief Executive
Christopher J. Cooney Officer

/s/ Robert B. Little Co-Chairman of the Board, February 12, 2001
--------------------------- President
Robert B. Little

/s/ William F. Lischak Chief Operating Officer, February 12, 2001
--------------------------- Chief Financial Officer,
William F. Lischak Secretary and Director

II-11

Signature Title Date
--------- -------- -----

Director February __, 2001
------------------------
Stephen K. Bannon

/s/ Nicholas Bavaro Director February 12, 2001
------------------------
Nicholas Bavaro

/s/ Jeffrey Cooney Director February 12, 2001
------------------------
Jeffrey Cooney

Director February __, 2001
------------------------
Joseph Linehan

/s/ Barry R. Minsky Director February 09, 2001
------------------------
Barry R. Minsky

/s/ Scot K. Vorse Director February 12, 2001
------------------------
Scot K. Vorse

II-12

Exhibit Index

Exhibit
Number Description of Document
-------- -----------------------

23.1 Consent of PricewaterhouseCoopers LLP. Filed herewith.

24.1 Power of Attorney. Filed herewith (included on signature page).

II-13