OPERATIONS

Critical Success Factors

Management's successful experiences coupled with strategic analysis, indicates three key success factors for the Company's business operations:

• The ability to operate on a low-cost, low-overhead basis that limits capital risk and minimizes wasteful spending.
• The ability to aggressively exploit every profitable revenue opportunity through proper marketing.
• The ability to identify key creative talent and develop effective collaborative relationships with top-caliber actors, writers, directors and their agents to ensure a consistently high quality flow of projects and material for motion picture and television development and distribution.

Key Operating Tactics

• Minimization of Capital Risk
  Investments in entertainment content can be extremely risky (please see paragraph D, "Risk Factors," below). The Company will minimize the risk exposure of its investors' capital by undertaking only those projects where the conservatively estimated potential financial returns exceed the cost of capital.
• Rigorous Control of Overhead
  The Company believes that it can achieve and maintain substantial reduction of expenses - as well as a reduction on the demands of senior management's time - by contracting out certain overhead-intensive logistical activities to third party providers.

Operating Responsibilities

• Marketing and Client Relations. The management team has developed a reputation for excellence in service, and established important relationships with major studios such as Paramount, Warner Bros., New Line, MGM, Disney, HBO, Showtime, A&E, Netflix, Twentieth Century Fox and CBS. The Company will continue its marketing and promotion efforts to build its image as a premier distributor designed to meet the needs of top-caliber production companies.
• Marketing and Distribution. Marketing and distribution executives set the strategy for marketing campaigns. The Company believes it will save substantial fixed overhead costs as well as demands on senior management's time, by contracting-out the tactical distribution services during the first several years of operation.
• Administration. Our executives negotiate contracts and deals with all "above-the-line" talent, including actors, writers, producers and others. They also handle general corporate, tax, and regulatory issues affecting the Company. In addition, they maintain close relationships with the creative community and provide financial management support.