<PAGE>
Relates to Form S-4 Registration No. 333-71195
Filed under Rule 424(b)(3) and (c).
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
The Marquee Group, Inc. SFX Entertainment, Inc.
Proxy Statement Prospectus
SUPPLEMENT NO. 1
TO
PROXY STATEMENT--PROSPECTUS DATED FEBRUARY 10, 1999
The date of this Supplement No. 1 is March 5, 1999.
The information contained in this Supplement No. 1 supplements the proxy
statement--prospectus dated February 10, 1999 of The Marquee Group, Inc.
("Marquee") and SFX Entertainment, Inc. ("SFX") relating to the special meeting
of Marquee stockholders scheduled to be held at 10:00 a.m., local time, on
Tuesday, March 16, 1999 in New York, New York. This Supplement No. 1 is being
delivered to all Marquee stockholders as of February 4, 1999, the record date
for the special meeting. This Supplement No. 1, together with the Annex
attached hereto, should be read in conjunction with the proxy
statement--prospectus, a copy of which was previously mailed to you. A copy of
the proxy statement--prospectus is available, without charge, upon the request
of any person to whom this Supplement No. 1 has been delivered. Stockholders
who wish to receive another copy of the proxy statement--prospectus should
contact Georgeson & Company Inc. at (800) 223-2064. All capitalized terms used
in this Supplement No. 1 (including the Annex attached hereto) but not defined
herein have the meanings given them in the proxy statement--prospectus.
Enclosed herewith is a new proxy card. The new proxy card should be
completed and sent to Marquee's proxy tabulators if (i) you have not previously
mailed a proxy card or (ii) you have previously mailed a proxy card and wish to
change your vote. See "The Special Meeting--Voting and Revocation of Proxies"
in the proxy statement--prospectus. IF YOU HAVE PREVIOUSLY MAILED A PROXY CARD
AND DO NOT WISH TO CHANGE YOUR VOTE, A NEW PROXY CARD DOES NOT NEED TO BE
COMPLETED.
RECENT DEVELOPMENTS
In February 1999, SFX completed the acquisitions of Cellar Door and
Integrated Sports International substantially on the terms summarized in the
proxy statement--prospectus.
Financial information for SFX's fiscal year ended December 31, 1998 has
recently become available. Revenue for 1998 increased to $884.3 million from
$96.1 million in 1997. Adjusted EBITDA (defined as operating income plus
depreciation and amortization, non-cash and non-recurring charges, and income
from equity investments) was $87.2 million versus $11.0 million last year. The
net loss applicable to common stock was $68.7 million for 1998 compared to net
income of $3.8 million last year. Basic and dilutive net loss per common share
was $2.75 in 1998 versus net income per common share of $0.26 in 1997.
On a pro forma basis, assuming all closed acquisitions, as well as the
pending Marquee merger, were completed as of January 1, 1997, revenue for the
year ended December 31, 1998 would have been $1.300 billion, an increase of 27%
over the pro forma $1.020 billion of the previous year, and pro forma adjusted
EBITDA including certain cost savings related to the acquisitions would have
grown 29% to $157 million, compared to $122 million in 1997.
The table, attached hereto as Annex A, sets forth certain unaudited
consolidated financial information of SFX for the year ended December 31, 1998
and corresponding audited information for the year ended December 31, 1997.
<PAGE>
ANNEX A
SFX ENTERTAINMENT INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
----------------------------
1998 1997
------------ -----------
(unaudited)
<S> <C> <C>
Revenue ............................................................... $ 884,286 $ 96,144
Operating expenses:
Cost of revenue ...................................................... 678,756 73,881
Selling, general and administrative expenses ......................... 111,748 9,536
Depreciation and amortization, including $2,406 of integration costs
in 1998 ............................................................ 62,197 5,431
Corporate expenses, including $530 in 1998 and $1,794 in 1997 of
Triathlon fees ..................................................... 11,194 2,206
Non-recurring charges ................................................ 5,600 --
Non-cash compensation and other non-cash charges ..................... 34,051 --
----------- -----------
Operating income (loss) ............................................ (19,260) 5,090
Income from equity investments, net ................................... (4,630) (509)
Interest expense ...................................................... 50,759 1,590
Investment income ..................................................... (4,491) (295)
Minority interest ..................................................... 2,036 --
----------- -----------
Income (loss) before provision for income taxes ....................... (62,934) 4,304
Provision for income taxes ............................................ 3,000 490
----------- -----------
Net income (loss) ..................................................... (65,934) 3,814
Accretion on stock subject to redemption .............................. (2,750) --
----------- -----------
Net income (loss) applicable to common stock .......................... $ (68,684) $ 3,814
----------- -----------
Basic and dilutive net income (loss) per common share ................. $ (2.75) $ 0.26
----------- -----------
Weighted average basic and dilutive common shares outstanding ......... 24,978,413 14,445,000
=========== ===========
</TABLE>
These statements of operations are subject to adjustments and examination
by public accountants.
A-1
