FORM 8 - K
CURRENT REPORT
FISCAL YEAR ENDING AUGUST 31, 1999
MERIT DIVERSIFIED INTERNATIONAL, INC.
(Exact name of Registrant as specified in its charter)
Nevada 0-212423
94 2906927
(State of Incorporation) (Commission File Number)
(U.S. Employer ID Number)
1801 Avenue of the Stars, Suite 635, Los Angeles, CA 90067
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (310) 552-0870
ITEM 1: Changes in Control of Registrant:
N/A
ITEM 2: Acquisition or Disposition of Assets:
The Company has acquired the following assets valued at $13,883,814:
1. The Company acquired 100% ownership of Allied Artists valued at
historic cost of $2,000,000. The Company issued 500,000 shares, paid
$150,000 USD and issued a promise to pay an additional $350,000 for
this business. Over the years, Allied Artists has produced and
distributed hundreds of films. Though it originally dealt with early
talkies, soundtracks, and cartoons, the corporation is now involved in
motion picture production and television for various studios, remaining
active in musical and television productions, as well as music videos.
The history of Allied Artists is long and varied. It became a household
name during the dawn of motion pictures when Allied Artists Records
was originally the soundtrack division of Allied Artists. Born shortly
after the demise of silent pictures, Allied became one of the first
companies in Hollywood to produce motion picture soundtracks for
commercial release, releasing hundreds of soundtracks throughout the
years, with numerous recording artists in worldwide-release. Allied
Artists employees 325 individuals with distribution, administration and
promotionals a dozen offices around the world. Allied is scheduled to
move from its main office in San Dimas, California into a 21,000 sq.ft.
facility in August 2000 in order to consolidate its operations and
integrate with Eye Candy Post into one location area.
In 1981, Allied Artists Records became a wholly owned subsidiary of
its parent company, and broadened its focus to include a variety of
music productions. While branching out, a special emphasis was
placed on new talent completely outside the realm of motion picture
production.
In its evolution, Allied Artists has always underscored the value, talent,
and creativity of the individual performing artist and/or musical group.
This year, the Board of Directors, guided by its Chairman, has vowed
to move Allied Artists into the millennium by taking full advantage of
technology and all its advances. In keeping with its tradition of
conducting business from the perspective of the performing artist, the
corporation's officers have vowed to expand its open door policy
through technology. Additional information about Allied Artists can
be found at www.alliedartists.net
In its 4th quarter, Allied Artists plans to operate mini cams for the
Internet employing a 3 camera shoot live at what is to be called
"AlliedArtist.net Night" utilizing 52k at half streams and full
broadband in order to feature live on the Internet its artists.
2. In order to compliment the acquisition of Allied Artists, The Company
acquired for 600,000 shares and $250,000 cash with commitment to build
out a new production facility at the cost of $5,000,000. Eye Candy Post is
located in 5,000 square feet of post-production facilities with 10
employees. Established in 1989 by Ogden Bass, Eye Candy Post has
ridden the wave of technology that led to the purchase of the most state-of-
the-art post-production tool, the Avid Symphony.
Eye Candy Post is a film and television Post Production Facility in
Universal City Plaza, California. It caters to on-line and off-line clients
with D2, Digital Betacam, Betacam and 3/4" videotape.
Eye Candy Post's new, centrally-located facility features four Avid off-line
bays, a Softimage|DS bay plus three Avid on-line bays. The highly-
creative environment with its colorful walls and leather sofas allows
producers to collaborate in rooms with views and hot espresso at
competitive rates. Eye Candy Post maintains a web site at
www.eyecandypost.com
At its new Universal City Plaza location, Eye Candy Post will offer
resolution-independent nonlinear finishing for stand definition, high
definition, feature film and DV projects. Eye Candy Post will also offer
film transfer, audio editing, final sound mixing, theatrical screening and
media preparation for uploading edited content to the Web.
Using the Symphony, Eye Candy Post has finished all types of projects
including:
Music Vidoes
Trailers
Promotional reels
Commercials
Animated programs
Live-action episodic television
Eye Candy Post is taking a leadership position in Hollywood when it
comes to the orientation of its clients to DV and Broadband content
formatting. As a post production technology company, Eye Candy Post
recognizes that interactive, web-based video will become an intrinsic part
of its client's product mix.
Because Eye Candy Post's clients are increasingly using the Internet to
conduct business, they reach out to ECP and expect Eye Candy to provide
them with a turnkey solution for the finishing and presenting of their
projects in all media:
Television
Videotape
DVD
Internet
Eye Candy Post is introducing its service called Streaming Dailies. These
services are designed to cut-down on the time spent receiving this type of
material.
The Internet has made drastic improvements to the point where accessing
this type of media has become an enjoyable experience.
Eye Candy Post clientele includes, A&E Network, ABC Home Video,
City of Los Angeles, City of Pasadena, City of Long Beach, CNN,
Columbia/Tri-Star, E! Entertainment Television, Eggers/Indigo Films, Fox
Family Channel, The Film Syndicate, Great Western Bank, Malcom Leo
Productions, MCA, NBC News, Scripps Howard Productions, Southern
California Edison, Team-One Advertising, Witt-Thomas Productions,
West Valley Studios, Xerox Corp., Yonex Corporation
The entertainment industry is highly competitive and actual results may
differ from those projected by the Company through its newly owned
subsidiaries.
3. Master Tapes: Value of $1,203,814 appraised by George L. (Sonny)
Carter, Tape Librarian, MCA Records, Inc. This as a result of the prior
commitment specified in the previous 8-K.
4. Films: Two motion pictures ready for production; value of $880,000
appraised by Dr. Philip Chamberlin of the Academy of Motion Picture
Arts & Sciences. This as a result of the prior commitment specified in
the previous 8-K.
5. 300,000 Dino Babies animation cels valued at $3,000,000. Items 3,4
and 5 were transferred into the Company as a result of the prior
commitment specified in the previous 8-K for the then new controlling
shareholders to transfer into the Company $5,000,000 in assets.
ITEM 3: Legal Proceedings Bankruptcy or Receivership:
There are no legal, bankruptcy and/or receivership proceedings.
ITEM 4: Changes in Registrant's Certifying Accountant:
The accounting firm representing the Company shall continue to be:
Andrew M. Smith, CPA
3711 Long Beach Blvd., Suite 809
Long Beach, Ca., 90807
ITEM 5: Other Events:
1. The Company gained shareholders' approval to change the Company's
name from "Merit Diversified International Inc" and may change its name
to Allied Artists Entertainment and Technology, Inc.
2. The Company's shareholders elected Robert Rooks, Michael Knox, James
M. Watkins, Lou Lesser, and John Farquhar to serve on the board of
directors.
3. Robert Rooks resigned as director and officer as of June 1, 2000
ITEM 6: Registrant's Directors:
Executive Officers of the Registrant:
The Executive Officers of the Company are listed below:
Curtis Shaw, President
Cal Burton, Vice President
Kurtis Blow, Vice President
Fred Rector, Vice President
Hiroko Sagawa, Treasurer
Georgetta Rainey, Secretary
ITEM 7: Financial Statements and Exhibits
Pursuant to rule 3-05 (b) of Regulation S-X audited financial statements are to
be furnished in accordance with rule 3-01 and 3-02 of Regulation S-X. The
audit of the acquired companies are currently incomplete. The audit is
expected to be completed within 60 days of the filing of this form 8-K. Such
financial statements will be submitted as an amendment to this form within
the prescribed period.
However, the following unaudited financial information is being provided
with this filing:
1) Exhibit A: Unaudited financial statements of Allied Artists as of
December 31, 1999
2) Exhibit B: Unaudited financial statements of Eye Candy Post
3) Exhibit C: Pro forma financial statements of the combined company
(consolidating Merit Diversified International, Allied Artists, and Eye
Candy Post) as of May 31, 2000 (post acquisition).
The quote below is from the OTC Bulletin Board. These amounts represent
an average. The Company's stock was thinly traded in fiscal year ended.
High Low
BID $9.25 $.25
ASK $10.00 $1.00
Note
1) As of August 31, 1999, the Company has approximately 1562 shareholders of
record.
2) The Company has not declared any cash dividends on its common stock.
Selected Financial
Data:
For Year
Ended______
1999 1998 1997 1996 1995 1994
Net Sales $-0- $-0- $-0- $-0- $-0- $-0-
Net Income(Loss) -0- -0- -0- -0- -0- -0-
Backlog(Loss) per
Share -0- -0- -0- -0- -0- (.02)
Cash Dividends per
Share -0- -0- -0- -0- -0- -0-
Total Assets -0- -0- -0- -0- -0- -0-
Long-Term Notes
Payable -0- -0- -0- -0- -0- -0-
SIGNATURES:
Pursuant to the requirements of Section 13 or 15(d), the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, hereunto duly authorized.
MERIT DIVERSIFIED INTERNATIONAL, INC.
_____________________________________
Georgetta Rainey, Secretary
Exhibit A Unaudited Financial Statements of Allied Artists Entertainment Group,
Inc.
Allied Artists Entertainment Group, Inc.
Balance Sheet (Unaudited)
December 31, 1999
Assets
Current Assets $47,045
Fixed Assets 13,057
Other Non-Current Assets 1,827,213
Total Assets $1,887,315
Liabilities and Equities
Current Liabilities $37,047
Shareholders Equity 1,790,269
Total Liabilities and Equity $1,887,315
Allied Artists Entertainment Group, Inc.
Income Statement (Unaudited)
Year Ended December 31, 1999
Revenues $48,286
Operating Expenses 40,448
Net Income $ 7,838
Exhibit B Unaudited Financial Statements of Eye Candy Post
Eye Candy Post
Balance Sheet (Unaudited)
December 31, 1999
Assets
Current Assets $106,730
Other Non-Current Assets 17,924
Total Assets $124,654
Liabilities and Equities
Current Liabilities $111,330
Shareholders Equity 13,324
Total Liabilities and Equity $124,654
Eye Candy Post
Income Statement (Unaudited)
Year Ended December 31, 1999
Revenues $710,164
Cost of Sales 348,796
Operating Expenses 367,317
Net Income (5,949)
