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- -------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION -----------------------------
FORM 4 WASHINGTON, D.C. 20549 OMB APPROVAL
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/ / CHECK THIS BOX IF NO STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OMB NUMBER: 3235-0287
LONGER SUBJECT TO EXPIRES: SEPTEMBER 30, 1998
SECTION 16. FORM 4 OR Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, ESTIMATED AVERAGE BURDEN
FORM 5 OBLIGATIONS MAY Section 17(a) of the Public Utility Holding Company Act of 1935 or HOURS PER RESPONSE .... 0.5
CONTINUE. SEE Section 30(f) of the Investment Company Act of 1940 -----------------------------
INSTRUCTION 1(b).
(Print or Type Responses)
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1. Name and Address of Reporting Person* 2. Issuer Name AND Ticker or Trading Symbol 6. Relationship of Reporting Person(s)
to Issuer (Check all applicable)
Lu, James K.T. Diamond Entertainment Corporation (DMEC) x Director x 10% Owner
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(Last) (First) (Middle) 3. IRS or Social Security 4. Statement for ---- title ---- (specify
Number of Reporting Month/Year below) below
Person (Voluntary) President
16200 Carmenita Road July 30, 1998 -------------------------------------
- -------------------------------------------- --------------------- 7. Individual or Joint/Group Filing
(Street) 5. If Amendment, (Check Applicable Line)
Date of Original x Form filed by One Reporting Person
(Month/Year) --- Form filed by More than One
Cerritos, CA 90703 --- Reporting Person
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(City) (State) (Zip) TABLE I - NON-DERIVATIVE SECURITIES ACQUIRED, DISPOSED OF, OR BENEFICIALLY OWNED
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1. Title of Security 2. Trans- 3. Trans- 4. Securities Acquired (A) 5. Amount of 6. Owner- 7. Nature
(Instr. 3) action action or Disposed of (D) Securities ship of In-
Date Code (Instr. 3, 4 and 5) Beneficially Form: direct
(Instr. 8) Owned at Direct Bene-
(Month/ End of (D) or ficial
Day/ ------------------------------------------- Month Indirect Owner-
Year) (A) or (I) ship
Code V Amount (D) Price (Instr. 3 (Instr. 4) (Instr. 4)
and 4)
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Common Stock 9-24-97 S4 1,499,523 D (1) 2,913,262 D
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Common Stock 9-1-97 G4 3,000,000 A (2) 4,412,785 D
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Common Stock 7-30-98 A4 1,499,523 A (5) 7,412,785(6) D
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(6) See attached.
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Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. (Over)
* If the form is filed by more than one reporting person, SEE Instruction 4(b)(v). SEC 1474 (7-97)
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FORM 4 (CONTINUED) TABLE II - DERIVATIVE SECURITIES ACQUIRED, DISPOSED OF, OR BENEFICIALLY OWNED
(E.G., PUTS, CALLS, WARRANTS, OPTIONS, CONVERTIBLE SECURITIES)
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1. Title of Derivative Security 2. Conver- 3. Trans- 4. Transac- 5. Number of Deriv- 6. Date Exer-
(Instr. 3) sion or action tion Code ative Securities Ac- cisable and Ex-
Exercise Date (Instr. 8) quired (A) or Dis- piration Date
Price of (Month/ posed of (D) (Month/Day/
Deriv- Day/ (Instr. 3, 4, and 5) Year)
ative Year)
Security
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Date Expira-
-------------------------------------- Exer- tion
cisable Date
Code V (A) (D)
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Common Stock Warrants (right to buy) $.10 9-1-97 G4 3,000,000 Immed. 9-1-02
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Employee Stock Options (right to buy) $.10 7-9-98 G4 6,000,000 (3) 7-9-03
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Employee Stock Options (right to buy) $.10 7-9-98 G4 2,000,000 Immed. 7-9-03
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7. Title and Amount of Under- 8. Price 9. Number 10. Owner- 11. Nature
lying Securities of of Deriv- ship of In-
(Instr. 3 and 4) Deriv- ative Form direct
ative Securi- of De- Bene-
Secur- ties rivative ficial
ity Bene- Secu- Own-
(Instr. ficially rity: ership
5) Owned Direct (Instr. 4)
at End (D) or
Amount or of Indi-
Title Number of Month rect (I)
Shares (Instr. 4) (Instr. 4)
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Common Stock 3,000,000 (2) D
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Common Stock 6,000,000 (3) D
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Common Stock 2,000,000 (4) 11,600,000 D
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Explanation of Responses:
See attached Addendum.
12/22/98
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**Intentional misstatements or omissions of facts constitute **Signature of Reporting Person Date
Federal Criminal Violations. SEE 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
James K.T. Lu
Note: File three copies of this Form, one of which must be manually signed.
If space is insufficient, SEE Instruction 6 for procedure.
Potential persons who are to respond to the collection of information contained
in this form are not required to respond unless the form displays a currently
valid OMB Number.
Page 2
SEC 1474 (7-97)
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James K.T. Lu
Addendum to Form 4
(1) The reported securities were assigned to four consultants of the Issuer
in lieu of the exercise of rights granted to such consultants by the Issuer
to acquire a 5% non-dilutive equity interest in the Issuer.
(2) The reported securities were issued or granted in consideration for
agreeing to defer payment of a portion of the Reporting Person's salary
though 3/31/98.
(3) The reported securities vest and become exercisable as follows:
2,000,000 upon completion of a portion of a joint private placement by
the Issuer; 2,000,000 upon successful sale of all real estate owned
indirectly by Issuer, and 2,000,000 for successfully bringing in certain
new business to the Issuer. To date, none of such vesting criteria have
been met.
(4) The reported securities were granted in consideration of the Reporting
Person's personal guaranty of a line of credit and a loan to the Issuer.
(5) The reported securities were issued in consideration of a Reporting
Person's settlement of a matter by and among certain former consultants
to the Issuer and the Reporting Person.
(6) Does not include 3,800,000 shares held of record by the Reporting Person
for the benefit of other directors of the Issuer. The Reporting Person
disclaims any beneficial ownership of such 3,800,000 shares.
