================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ___________________
Commission File Number 0-9455
LITTLE PRINCE PRODUCTIONS LIMITED
(Exact name of registrant as specified in its charter)
New York 13-3045713
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
38 South Audley Street, London, England W1Y 5DH N/A
(Address of principal executive offices) (Zip Code)
(010 44 171) 629-7617
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
such shorter period that registrant was required to file such reports), and (2)
has been subject to filing requirements for the past 90 days. Yes X No
--- ---
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. As of August 5, 1996, there
were 24,999,236 shares of the issuer's $.01 par value common stock outstanding.
================================================================================
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
LITTLE PRINCE PRODUCTIONS LIMITED AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
June 30, 1996 and December 31, 1995
June 30, December 31,
-------- ------------
1996 1995
---- ----
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,635 $ 946
Prepaid expenses and taxes 612 612
Other debtors 6,629 6,629
----- -----
Total current assets 9,876 8,187
PROPERTY AND EQUIPMENT - AT COST
Furniture, fixtures and equipment -- --
Less: Accumulated depreciation -- --
-------- --------
Net property and equipment -- --
OTHER ASSETS
Production and distribution rights 3,750 5,000
Investment in joint ventures 3,728 3,728
------ ------
Total other assets 7,478 8,728
------ ------
TOTAL ASSETS $17,354 $16,915
======= =======
2
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Continued)
June 30, 1996 and December 31, 1995
June 30, December 31,
-------- ------------
1996 1995
---- ----
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 159,145 $ 159,145
Provision for legal fees 15,917 15,322
Accrued audit fees 7,364 13,000
Other accrued liabilities 5,544 4,494
Short-term loans from major shareholder 120,085 92,355
---------- ---------
Total current liabilities 308,055 284,326
NON-CURRENT LIABILITIES -- --
---------- ----------
TOTAL LIABILITIES 308,055 284,326
SHAREHOLDERS' EQUITY
Common stock $0.01 par value
Authorized - 25,000,000 shares
Issued and outstanding - 24,999,236 shares 249,992 249,992
Additional paid-in capital 3,006,891 3,006,891
Accumulated deficit (3,547,584) (3,524,294)
----------- -----------
Total shareholders' deficit (290,701) (267,411)
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' $ 17,354 $ 16,915
========== ==========
EQUITY
3
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS
For the Three Months and Six Months Ended June 30, 1996 and 1995
<TABLE>
<CAPTION>
Three Months ended June 30, Six Months ended June 30,
--------------------------- -------------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 1,000 $ 1,100 $ 6,241 $ 5,600
Operating costs (12,359) (39,049) (29,531) (65,451)
---------- ---------- ---------- ----------
Loss from continuing operations (11,359) (37,949) (23,290) (59,851)
Interest income -- 110 -- 214
Interest expense -- -- -- --
---------- ---------- ---------- ----------
Loss from continuing operations
before provision for income
taxes (11,359) (37,839) (23,290) (59,637)
Provision for income taxes -- -- -- --
---------- ---------- ---------- ----------
Loss from continuing operations
after provision for income taxes (11,359) (37,839) (23,290) (59,637)
Loss from discontinued -- -- -- --
operations
Gain on disposal of subsidiary -- -- -- --
NET LOSS (11,359) (37,839) (23,290) (59,637)
========== ========== ========== ==========
Loss per share (cents) (0.04) (0.15) (0.09) (0.24)
========== ========== ========== ==========
Average number of shares 24,999,236 24,999,236 24,999,236 24,999,236
outstanding ========== ========== ========== ==========
</TABLE>
4
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Six Months Ended June 30, 1996
<TABLE>
<CAPTION>
Six Months ended June 30,
-----------------------------------------------
1996 1995
---- ----
<S> <C> <C>
OPERATING ACTIVITIES
Net loss $ (23,290) $(59,637)
Adjustments to reconcile net loss to Net Cash
Provided by Operating Activities:
Depreciation 1,250 1,250
Minority interests -- --
Change in Asset and Liabilities:
Accounts Receivable and Other Debtors -- --
Development Properties -- --
Increase/(Decrease) in Liabilities:
Accounts payable and Accrued Expenses (4,001) (23,000)
Effect of foreign currency exchange rate
changes on cash and cash equivalents -- --
Adjustment on disposal of subsidiary -- --
--------- --------
Total Adjustments (2,751) (21,750)
--------- --------
NET CASH - OPERATING ACTIVITIES (26,041) (81,387)
INVESTING ACTIVITIES:
Proceeds on disposal of subsidiary -- --
Proceeds on disposal of US Government Bonds -- 9,500
--------- --------
NET CASH - INVESTING ACTIVITIES -- 9,500
FINANCING ACTIVITIES
New short-term loans 27,730 69,030
Repayment of loans -- --
Bank Overdrafts -- --
Cash released on disposal of subsidiary -- --
--------- --------
NET CASH - FINANCING ACTIVITIES 27,730 69,030
NET (DECREASE)/INCREASE IN CASH
AND CASH EQUIVALENTS 1,689 (2,857)
CASH AND CASH EQUIVALENTS -
BEGINNING 946 5,241
--------- --------
CASH AND CASH EQUIVALENTS - END 2,635 2,384
========= ========
</TABLE>
5
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED AND SUBSIDIARY
NOTES TO FINANCIAL STATEMENTS
(Revised and Unaudited)
The balance sheet as of June 30, 1996, the statements of operations for the six
months ended June 30, 1995 and 1996, and the statement of cash flows for the six
months ended June 30, 1995 and 1996 have been prepared by registrant without
audit. The accompanying unaudited interim financial statements include all
adjustments (consisting only of those of a normal recurring nature) which in the
opinion of management are necessary for a fair statement of the results for the
interim periods.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these financial statements
be read in conjunction with the financial statements and notes thereto included
in registrant's Form 10-KSB for the year ended December 31, 1995.
6
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
Financial Condition
A Shareholders' deficit of $290,701 existed at June 30, 1996. The
majority of the expenditures of Registrant over the 18-month period ended June
30, 1996 have been met from funding provided in the form of loans from Patchouli
which at June 30, 1996 totalled $120,085, of which $9,111 were advanced in the
quarter ended June 30, 1996. Patchouli has continued to advance further funds
since that date.
Results of Operations
Income in the quarter arose from fees received from the licensing of
various theatrical productions. This income did not reflect any change in the
business of Registrant but typified the nature and timing of the income
generated.
During 1995 and the first half of 1996, the Company was inactive except
for administrative activities in connection with the preparation and filing of
the periodic reports required under Section 13 of the Securities Exchange Act of
1934, as amended (the "Exchange Act") and in preparing the proxy statement for a
Special Meeting of Shareholders that was held on February 29, 1996. The majority
of the operating costs of $12,359 incurred in the quarter to June 30, 1996
related specifically to the audit, accounting and legal costs.
To date, the Company has not consummated the Merger, as discussed in
Registrants Form 10- QSB for the quarter ended March 31, 1996, as it is still
awaiting the consent of the New York Commissioner of Taxation and Finance, which
consent is required in order to file the Certificate of Merger with the
Secretary of State of New York. The Company has recently received certain tax
information from the New York Department of Taxation and Finance and expects to
file its past-due tax returns in addition to the Certificate of Merger by August
9, 1996. The Company believes that the Merger will become effective by the end
of August, 1996.
On July 22, 1996 the Company completed the disposal of the whole of its
interest in its former subsidiary LPPL Corp. A detailed description of this
transaction is contained in "Part II. Item 5, Other Information" of this report.
Future Liquidity and Capital Resources
LPPL Corp. constituted substantially all of the Company's assets and
only form of revenue. Until the Merger becomes effective, the Company is
dependent in the short term from continued loans from Patchouli. Upon
consummation of the Merger the Company intends to acquire through the issuance
of additional shares a suitable business or businesses and/or to obtain
additional funds through the sale of Common Stock in public or private
transactions.
7
<PAGE>
Registrant had no material commitments for capital expenditure at
either June 30, 1996 or at December 31, 1995.
PART II. OTHER INFORMATION
Item 5. Other Information
At the Special Meeting of Shareholders held on February 29, 1996, the
Company's shareholders approved an action authorizing the Company's Board of
Directors to sell or dissolve LPPL Corp. In accordance therewith, on July 22,
1996, the Company sold its ownership interest in all of the issued and
outstanding capital stock of LPPL Corp. (the "Capital Stock") to Frances Katz
Levine, an independent third party, pursuant to that certain Stock Purchase
Agreement (the "Agreement") dated July 22, 1996. As consideration for the
capital stock, the Company received $10 and Ms. Levine's agreement to use her
best efforts to effect and complete by July 21, 1997, at no cost to the Company,
the reincorporation of LPPL Corp. under the state of Delaware, and,
concomitantly therewith, increase the number of shares of authorized capital
stock of LPPL Corp. and distribute the shares of common stock of LPPL Corp. to
the shareholders of the Company as of July 22, 1996 at a ratio of one share of
the Capital Stock for every one share of common stock of the Company or such
other ratio as required by the attendant circumstances, which distribution shall
be made in accordance with the requirements of all applicable federal and state
securities laws and regulations. In the event Ms. Levine fails to complete the
above actions by July 21, 1997, she shall immediately take all steps necessary
to dissolve LPPL Corp. and deliver any assets remaining after dissolution, if
any, to the Company.
LPPL Corp. represented substantially all of the Company's assets. The
effect of the sale of LPPL Corp. on the Company's financial condition is
reflected in the pro forma financial statements below.
UNAUDITED PRO FORMA FINANCIAL INFORMATION
Set forth below is unaudited historical and pro forma financial
information for the Company as of June 30, 1996 and December 31, 1995. The pro
forma information has been prepared assuming that the sale or dissolution of
LPPL Corp. occurred on June 30, 1996 and December 31, 1995. The pro forma
information is based on the historical financial information of the company and
should be read in conjunction with the historical financial statements and notes
of the Company included in this report. In the opinion of management, all
material adjustments necessary to reflect the effects of the transactions have
been made.
The pro forma information is unaudited and is not necessarily
indicative of the results which actually would have occurred if the transaction
had been consummated in the period presented, or on any particular date in the
future, nor does it purport to represent the financial position for future
periods.
8
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED
PROFORMA CONDENSED BALANCE SHEET AT JUNE 30, 1996
<TABLE>
<CAPTION>
Condensed
Historical Proforma Proforma
Balance Sheet Adjustments Balance Sheet
------------- ----------- -------------
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,635 $ (2,635)(1) $
Prepaid expenses and taxes 612 (612)(1)
Loan to officer of Company 6,629 (6,629)(1)
Amounts due from former subsidiary -- 9,879 (2) 9,879
---------- ----------- ------------
Total current assets 9,876 3 9,879
OTHER ASSETS
Production and distribution rights 3,750 (3,750)(1) --
Investment in joint ventures 3,728 (3,728)(1) --
---------- ----------- ------------
Total other assets 7,478 (7,478) ----
TOTAL ASSETS 17,354 (7,475)(1) 9,879
========== =========== ============
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES
Trade creditors 159,145 (159,145)(1) --
Accrued expenses 28,825 -- 28,825
Short-Term Loan from major shareholder 120,085 -- 120,085
---------- ----------- ------------
TOTAL LIABILITIES 308,055 (159,145) 148,910(3)
========== =========== ============
SHAREHOLDERS' EQUITY
Common stock $0.01 par value
Authorized - 25,000,000 shares
Issued and outstanding - 24,999,236 shares 249,992 -- 249,992
Additional paid-in-capital 3,006,891 -- 3,006,891
Accumulated deficit (3,547,584) 151,670(1) (3,299,234)
---------- ----------- ------------
Total Shareholders' equity (290,701) 151,670 (139,031)
---------- ----------- ------------
TOTAL LIABILITIES AND SHAREHOLDERS' 17,354 (7,475) 9,879
EQUITY ========== =========== ============
</TABLE>
- ----------------
Adjustments to Unaudited Pro Forma Balance Sheet
(1) The adjustments reflect those assets and liabilities attributable to LPPL
Corp. that will no longer be included in the Company's consolidated balance
sheet after LPPL Corp.'s dissolution or sale.
(2) This adjustment reflects indebtedness due from LPPL Corp. to the Company and
assumes such amount will be repaid in full.
(3) As discussed under "MANAGEMENT'S DISCUSSION AND ANALYSIS-Future Liquidity
and Capital Resources" the Company is dependent, in the short term, on continued
loans from the Patchouli Foundation to pay its current liabilities and, in the
long term, on the acquisition suitable business that will enable the Company to
become profitable.
9
<PAGE>
LITTLE PRINCE PRODUCTIONS LIMITED
PROFORMA CONDENSED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Year ended December 31, 1995 Six Months ended June 30, 1996
----------------------------------------------- -------------------------------------------
Condensed Condensed
Historical Proforma Historical Proforma
Statement of Proforma Statement of Statement of Proforma Statement of
Operations Adjustments Operations Operations Adjustments Operations
---------- ----------- ---------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Net Sales $ 20,779 $ (20,779) $ -- $ 6,241 $(6,241) --
Operating costs (125,726) 51,725(1) (74,001)(2) (29,531) 5,802(1) (23,729)(2)
---------- ----------- ---------- ---------- ------- ----------
Loss from continuing operations (104,947) (30,946) (74,001) (23,290) (439) (23,729)
Interest Income -- -- -- -- -- --
-- -- -- -- -- --
Loss from continuing operations before (104,947) (30,946) (74,001) (23,290) (439) (23,729)
provision for income taxes
Provision for income taxes -- -- -- -- -- --
---------- ----------- ---------- ---------- ------- ----------
NET LOSS (104,947) (30,946) (74,001) (23,290) (439) (23,729)
---------- ----------- ---------- ---------- ------- ----------
Loss per share (cents) (0.42) (0.29) (0.09) (0.09)
----- ---------- ---------- ----------
Average number of shares outstanding 24,999,236 24,999,236 24,999,236 24,999,236
========== ========== ========== ==========
</TABLE>
- ----------------
Adjustments to Unaudited Pro Forma Condensed Statement of Operations
(1) The pro forma adjustment to the "Operating Costs" represents those costs
attributable to the operations of LPPL Corp., which costs the Company is not
expected to incur after the sale or dissolution of LPPL Corp.
(2) The pro forma "Operating Costs" after adjustment constitute those operating
costs attributable to the Company and not LPPL Corp. that are expected to
continue after the sale or dissolution of LPPL Corp. These costs generally
comprise legal and auditing fees incurred by the Company.
10
<PAGE>
Exhibits and Reports on Form 8-K
a. Exhibits: Exhibit No. 2.3 Stock Purchase Agreement
b. Reports on Form 8-K:
None
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
LITTLE PRINCE PRODUCTIONS LTD.
By /s/ P.N. Chapman
------------------------------------------------------
P. N. Chapman, Chief Financial Officer,
duly authorized to sign this report on its
behalf
12
EXHIBIT 2.3
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, made this 22nd day of July 1996, between
LITTLE PRINCE PRODUCTIONS, LTD., 38 South Audley Street, London W1Y 5DH (the
"Seller") and FRANCES KATZ LEVINE, 621 Clove Road, Staten Island, New York 10310
(the "Buyer").
WHEREAS, Seller is the sole shareholder of all of the issued and
outstanding capital stock (the "LPPL Stock") of LPPL Corp., a New York
Corporation ("LPPL").
WHEREAS, at a special meeting of the shareholders of Seller, which was
held on February 29, 1996, the shareholders of Seller approved a resolution
authorizing the Board of Directors of Seller to sell or dissolve LPPL.
WHEREAS, Buyer and the Board of Directors of Seller believe that it
will be in the best interests of the shareholders of Seller for Buyer to
purchase the LPPL Stock, re-incorporate LPPL under the laws of the State of
Delaware, increase the authorized capital stock of LPPL, and distribute shares
of the LPPL to the shareholders of Seller in accordance with the requirements of
the Securities Act of 1933, as amended (the "Securities Act") and all other
applicable federal and state securities regulations.
WHEREAS, Seller is willing to sell, assign and transfer all of its
right, title and interest in the LPPL Stock to Buyer upon the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the parties do agree as follows:
1. AGREEMENT
1.1 Sale and Purchase of Stock
Buyer agrees to purchase and the Seller agrees to sell at the Closing,
on the Closing Date, as those terms are defined below, all of the issued and
outstanding stock of LPPL (the "LPPL Stock") in exchange for the purchase price
set forth in Paragraph 1.2 below (the "Purchase Price").
1.2 Purchase Price
The Purchase Price for the LPPL Stock shall consist of the following:
(a) Ten United States Dollars ($10); and
<PAGE>
(b) Buyer's agreement hereby given to use her best efforts to
effect and complete within one year from the date of this
agreement, at no cost to the Seller, the following
transactions:
(i) Reincorporation of LPPL under the laws of the State
of Delaware and, concomitantly therewith, the
effectuation of an increase in the authorized capital
stock of LPPL so as to facilitate the share issuances
and distribution contemplated hereunder and
(ii) Distribution of shares of the common stock of LPPL to
the shareholders of Seller, of record as at the date
hereof (the "Record Date"), at a ratio of one share
of the common stock of LPPL for every one (1) share
of the common stock of the Parent held as at the
Record Date, or at such other ratio as shall be
required by the attendant circumstances, which
distribution shall be made in accordance with the
requirements of all applicable federal and state
securities laws and regulations.
1.3 Failure of Consideration
Buyer agrees that in the event that she fails to complete the actions
constituting consideration for her purchase of the LPPL Stock hereunder, as set
forth, above, in Paragraph 1.2(b) of this agreement, within one year from the
date of this agreement, she shall immediately take all steps necessary to
dissolve LPPL Corp. and deliver any remaining assets after dissolution to
Seller.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER
Seller represents, warrants and covenants to Buyer that:
(a) Seller has full and valid title to the shares of LPPL Stock and
there are no existing impediments to the sale and transfer of such shares to
Buyer; the said shares are free and clear of all liens, charges, security
interests, and encumbrances whatsoever and such shares constitute 100% of the
issued and outstanding shares of LPPL.
(b) Seller has full right, power, legal capacity, and authority to
enter into this agreement and to sell and deliver the LPPL Stock pursuant to the
terms of this agreement.
(c) Seller acknowledges and agrees that Buyer will incur substantial
costs and expenses in respect of the value of the legal services to be furnished
by Buyer as well as reorganization and filing fees and accounting, printing and
distribution costs associated with reincorporating and recapitalizing LPPL and
distributing shares of the LPPL common stock to the shareholders of Seller
pursuant to the requirements of all applicable federal and state securities
regulations. Seller further acknowledges and agrees that Buyer may be
compensated for her time and services and, in addition, may finance, pay or
defray all or part of such costs
2
<PAGE>
and expenses through the issuance of shares of common stock of LPPL Corp., as
Buyer shall determine.
(d) Seller agrees that commencing upon execution of this agreement,
Buyer and her agents and representatives shall have reasonable access to the
books of account and any and all other records of LPPL and Seller reasonably
related to this agreement, and LPPL's filing and disclosure obligations under
the federal securities laws and any other applicable federal, state or local
laws, rules or regulations. Seller and its counsel and accountants will
cooperate with Buyer so as to enable her to effect the actions described in
Paragraph 1.2(b) above, as expeditiously and economically as possible and in
pursuance thereof will provide Buyer with such information, documentation and
other matters, including but not limited to all materials respecting LPPL
prepared by Seller in connection with its filing and disclosure obligations
under the federal securities laws, as Buyer shall reasonably request. Whenever
possible, Seller shall furnish such materials on computer diskette.
(e) Upon execution of this agreement, any of the corporate financial
records, minute books, and other documents and records of LPPL Corp. which are
not already in the possession of A. Joseph Tandet will be turned over in their
entirety to the Buyer; provided, however, that Seller shall be entitled to
retain a copy of all records provided to Buyer for its corporate records.
(f) Upon execution of this agreement, Seller will deliver to Buyer the
resignations, effective as at such time, of any persons, other than Mr. Tandet,
who hold positions as officers or directors of LPPL.
(g) There are not more than twenty-four million, nine hundred
ninety-nine thousand, two hundred and thirty-six (24,999,236) shares of common
stock of the Seller issued and outstanding as of the date hereof and there are
no outstanding warrants, options or commitments of any nature which may cause
authorized but unissued shares of the capital stock of the Parent to be issued
to any person, other than fifty thousand (50,000) shares to be issued to Mr.
Tandet.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF BUYER
Buyer represents, warrants and covenants to Seller that:
(a) Buyer shall use her best efforts forthwith to effect and complete
all of the actions constituting consideration for her purchase of the LPPL Stock
as set forth, above, in Paragraph 1.2(b) of this agreement, at the sole expense
of LPPL, including reimbursement of any expenses incurred by Seller's counsel or
accountants in complying with the requirements of Paragraph 2.1(d) of this
agreement.
(b) In the event Buyer is unable to comply with the requirements of
Paragraph 1.2(b) of this agreement within one year from the date hereof, she
shall comply with the requirements of Paragraph 1.3 of this agreement.
3
<PAGE>
(c) Buyer has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of an investment in
the LPPL Stock. Buyer recognizes that her investment in the LPPL Stock involves
a high degree of risk.
(d) Mr. Tandet is currently the chief executive officer of LPPL and
will continue to serve as such following execution of this agreement and will
use his best efforts to ensure that until the distribution of shares of common
stock of LPPL to the shareholders of Seller is effected, LPPL shall:
(i) Conduct its business and operations solely in the
usual, normal and ordinary course;
(ii) Except as provided for in this agreement, make no
distributions to its shareholders of any of its
assets or properties by way of dividends, purchase of
shares, redemptions or otherwise;
(iii) Except as may be required to effect the transactions
contemplated by this agreement, pay no salary, wages,
bonus or compensation to any officer, employee,
representative or agent of LPPL other than in the
ordinary course of business under employment
arrangements in effect on the date of this agreement
or otherwise in accordance with LPPL's presently
existing administrative programs and, in the case of
employees who are not officers and directors, in
accordance with periodic review and adjustment of
salaries consistent with past practices;
(iv) Not sell, transfer or dispose of any of its material
properties or assets whatever, tangible or intangible
except full and fair consideration in the usual,
normal and ordinary course of business;
(v) Make no purchases or acquisitions of any real or
personal property except in the usual, normal and
ordinary course of business;
(vi) Not subject any of its property or assets whatever,
tangible or intangible, to any mortgage, lien,
pledge, hypothecation or encumbrance in any manner
except for full and fair consideration in the usual,
normal and ordinary course of business;
(vii) Except as may be required to effect the transactions
contemplated by this agreement, not borrow any money,
make any unusual or extraordinary expenditures or
incur or become liable for any obligations or
liabilities;
(viii) Not make any loans or advances or extend any credit;
and
4
<PAGE>
(ix) Except as may be required to effect the transactions
contemplated by this agreement, not amend it bylaws,
certificate of incorporation or other charter
documents or make any changes in its business
policies and operations.
4. CLOSING
(a) The Closing of this agreement shall take place simultaneously with
the execution of this agreement, via telephone and telefax, with all deliveries
of documents to be made by recognized overnight courier.
(b) At the Closing, Seller shall deliver to Buyer the certificates
representing the LPPL Stock duly endorsed in blank and with stock powers
executed in blank attached thereto and Buyer will deliver the cash portion of
the Purchase Price to Seller.
5. GENERAL
5.1 Binding Effect
This agreement shall inure to the benefit of and be binding upon the
Buyer and the Seller and their respective heirs, executors, administrators,
successors, assigns and legal representatives.
5.2 Notices
Any notice, report or demand required or permitted by any provision of
this agreement shall be sent by certified mail or recognized overnight courier,
in all cases with written confirmation of receipt required, to the parties
hereto at the addresses set forth above or to any other address as shall be
designated from time to time by the respective parties. Receipt of notice shall
be deemed effective on delivery.
5.3 Brokerage
Buyer and Seller represent to each other that neither has employed any
broker or entered into any agreement for the payment of any fees, compensation,
or expense to any person, firm or corporation in connection with the within
transaction, and each agrees to hold and save the other harmless from any such
fees, compensation or expenses which may be suffered by reason thereof;
provided, however, that each party hereto shall bear its own counsel fees, costs
and expenses other than as specified in this agreement.
5.4 Counterparts
This agreement may be executed in any number of counterparts, each of
which shall be an original, but all such counterparts shall constitute one and
the same instrument.
5
<PAGE>
5.5 No Oral Change; Assignment
This agreement may not be changed or terminated orally. The terms of
this agreement are to apply to and bind the legal representatives, successors
and assigns of the respective parties.
5.6 Governing Law
This agreement shall be construed, interpreted and enforced in
accordance with the laws of the State of New York.
5.7 Partial Invalidity
If any term or provision of this agreement or the application thereof
to any party or circumstances shall to any extent be invalid or unenforceable,
the remainder of this agreement or the application of such term or provision to
parties or circumstances other than those to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this agreement shall be valid and enforced to the fullest extent permitted by
law.
5.8 Number, Gender
Wherever herein the singular number is used, the same shall include the
plural, and the masculine gender shall include the feminine and neuter genders.
5.9 Headings
The Paragraph headings herein are intended for convenience in finding
the subject matters, are not to be taken as part of this agreement and are not
to be used in determining the intent of the parties to this agreement.
5.10 Further Assurances
At any time, and from time to time, after the date of this agreement,
each party will execute such additional instruments and take such action as may
be reasonable requested by the other party to confirm or perfect title to any
property transferred or to be transferred in accordance with the terms hereof or
otherwise to carry out the intent and purposes of this agreement.
5.11 Waivers
Each party hereto may:
(a) By written approval extend the time for performance of any of
the obligations of another party if requested in writing by
such other party;
6
<PAGE>
(b) Waive in writing any inaccuracies in representations and
warranties made to it contained in this agreement or any
exhibit hereto or any certificate or certificates delivered by
another party pursuant to this agreement;
(c) Waive in writing the failure of performance of any of the
conditions herein expressed, or alternatively rescind for such
failure; and
(d) Waive in writing compliance with any of the covenants herein
contained by another party and so waive performance of any of
the obligations of such other party hereto.
5.12 Non-waiver
The waiver by any party hereto of any breach, default, inaccuracy or
failure by another party with respect to any provision of this agreement or any
exhibit thereto shall not operate or be construed as a waiver of any other
provision thereof or of any subsequent breach thereof.
7
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this agreement the
day and year first above written.
LITTLE PRINCE PRODUCTIONS, LTD.
By /s/ Adrian P. Kirby
---------------------------------------------
Adrian P. Kirby, Chairman and President
/s/ Frances Katz Levine
------------------------------------------------
Frances Katz Levine, an individual
8
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 318958
<NAME> LITTLE PRINCE PRODUCTIONS, LTD.
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<EXCHANGE-RATE> 1
<CASH> 2,635
<SECURITIES> 0
<RECEIVABLES> 6,629
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 9,876
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 17,354
<CURRENT-LIABILITIES> 308,055
<BONDS> 0
0
0
<COMMON> 249,992
<OTHER-SE> (540,693)
<TOTAL-LIABILITY-AND-EQUITY> 17,354
<SALES> 0
<TOTAL-REVENUES> 6,241
<CGS> 0
<TOTAL-COSTS> (29,531)
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (23,290)
<INCOME-TAX> 0
<INCOME-CONTINUING> (23,290)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (23,290)
<EPS-PRIMARY> (.09)
<EPS-DILUTED> (.09)
</TABLE>
