GUARDIAN PRODUCTIONS, LLC
BALANCE SHEET
AS OF DECEMBER 31, 1999*
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ASSETS
CASH $2,500
INTANGIBLE ASSETS:
Productions $697,527
IBS rights $1,000,000
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Total Assets $1,700,027
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LIABILITIES AND MEMBER'S INTEREST
DUE TO AFFILIATE $25,000
NOTE PAYABLE $1,672,527
MEMBER'S INTEREST $2,500
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Total Liabilities and Member's Interest $1,700,027
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*The accompanying notes are an integral part of this balance sheet.
GUARDIAN PRODUCTIONS, LLC
NOTES TO BALANCE SHEET
DECEMBER 31, 1999
1. ORGANIZATION:
Guardian Productions, LLC ("Guardian"), a Delaware limited liability
company, was formed in December 1999. Guardian acquired the
exclusive rights to produce and distribute The Visual Bible(
throughout the world (Note 2). Guardian intends to merge into
another company, Visual Bible, Inc., with Visual Bible, Inc. being
the surviving company (Note 3). Guardian and its successor, Visual
Bible, Inc., are referred to collectively as "the Company."
The Company also intends to pursue acquisitions, including
intellectual properties and distribution companies, which will
augment its efforts to become a premier producer and distributor of
family oriented products.
2. INTANGIBLE ASSETS:
Effective December 16, 1999, Guardian entered into an agreement with
Visual International PTY, LTD, ("VI") a Republic of South Africa
corporation, to obtain the exclusive rights to produce and
distribute visual presentations of all the books of the New
International Version of the Bible using the product name The Visual
Bible(.
Among the assets acquired from VI were the completed video works of
the Gospel According to Matthew and the Book of Acts along with a
variety of ancillary products which were related to and created from
these two core products.
Guardian also acquired the contractual rights granted by the
International Bible Society ("IBS") to VI in March 1994 to produce
the remaining books of the Bible using the New International Version
of the text.
This contract allows the Company to produce all of the remaining
books of the Bible so long as they meet certain minimum production
requirements. The Company must produce eight additional books of
the Bible by March 2004 to receive a ten-year extension to the
original contract. Guardian is currently beginning pre-production
work on three additional books of the Bible. Management is of the
opinion that they will be able to meet the production requirements
necessary to secure the additional ten-year extension from IBS.
The total purchase price of the assets acquired from VI was
approximately $1,700,000. Guardian paid VI $25,000 at Closing and
has entered into a note payable for the balance of the purchase
price. The note is noninterest-bearing and is due September 1, 2000.
Guardian has allocated approximately $697,000 of the purchase price
to the intellectual property related to Matthew and Acts (the
"Productions") based upon an assessment of value estimated from net
cash flows from existing productions and the remaining $1,000,000 to
the intellectual property related to the contractual rights to
produce the remaining books of the Bible under the IBS contract (the
"IBS rights"). The Productions will be amortized using an estimated
total unit production of approximately 416,000 units. The IBS
rights will be amortized over the remaining life (50 months) of the
original IBS contract.
3. SUBSEQUENT EVENT:
Guardian intends to merge with a newly formed Florida corporation
(Visual Bible, Inc.) by the end of June 2000, with Visual Bible,
Inc. being the surviving entity. Visual Bible, Inc. also intends to
acquire the outstanding share of Visual Entertainment, Inc. ("VE")
after VE has reacquired substantially all of its outstanding shares
through a share buyback. At the conclusion of these transactions,
VE will be a wholly owned subsidiary of the Company.
The Company also intends to raise substantial equity through either
a private placement or public stock offering and production
financing through a private placement or public debt offering. The
Company also intends to actively pursue these transactions and
currently expects to complete them by the end of the second quarter
or the beginning of the third quarter of 2000.
Lastly, the Company intends to seek a NASDAQ-listed company with
which it can complete a reverse merger.
