<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
--------------------
FORM 10-QSB
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934.
--------------------
For Quarter Ended March 31, 1996 Commission file number 0-18410
THE PRODUCERS ENTERTAINMENT GROUP LTD.
(Exact name of registrant as specified in its charter)
Delaware 95-4233050
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9150 Wilshire Boulevard, Suite 205, Beverly Hills, CA 90212
-----------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (310) 285-0400
Not Applicable
---------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the proceeding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common stock - May 1, 1996 - 12,971,481
---------------------------------------
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THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, June 30,
1996 1995
------------ ------------
(unaudited)
ASSETS
<S> <C> <C>
Cash and cash equivalents $ 81,268 $ 832,754
Accounts receivable, net 714,779 652,074
Notes receivable, net -- 402,842
Receivables from related parties 14,876 116,229
Film costs, net 3,209,942 2,104,503
Fixed assets, net 58,490 76,439
Other assets 213,107 199,829
------------ ------------
$ 4,292,462 $ 4,384,670
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Note payable to related parties $ 100,000 $ --
Accounts payable and accrued expenses 491,986 847,595
Deferred participations based on estimated
revenues -- 350,000
Deferred revenue 2,151,694 598,708
------------ ------------
Total liabilities 2,743,680 1,796,303
------------ ------------
Shareholders' equity:
Preferred Stock, $.001 par value
Authorized 10,000,000 shares;
Issued 1,000,000 shares - Series A 1,000 1,000
Common stock, $.001 par value
Authorized 50,000,000 shares;
issued 14,093,917 and 11,388,770 shares 14,094 11,389
Additional paid-in capital 16,103,509 15,321,214
Accumulated deficit (12,735,629) (11,735,044)
------------ ------------
3,382,974 3,598,559
Treasury stock 1,122,436 shares, at cost (1,010,192) (1,010,192)
Notes receivable from related parties from
sales of common stock, net of imputed
interest discount (824,000) --
------------ ------------
Net shareholders' equity 1,548,782 2,588,367
------------ ------------
$ 4,292,462 $ 4,384,670
============ ============
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE> 3
THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine months ended March 31,
-------------------------------
1996 1995
---- ----
<S> <C> <C>
Revenues $ 2,132,767 $ 4,971,334
Film amortization 717,000 2,808,752
------------ ------------
1 415,767 2,162,582
Write down of film costs to net
realizable values -- 937,298
General and administrative expenses 2,665,625 3,660,150
------------ ------------
Operating (loss) (1,249,858) (2,434,866)
Income from settlement of lawsuits 267,633 --
Forgiveness of note receivable from
related party (68,016) --
Provision for note receivable -- (270,000)
Reduction in deferred participations -- 200,000
Interest income 49,656 28,260
Interest and financing expense -- (296,741)
------------ ------------
Net (loss) (1,000,585) (2,773,347)
Dividend requirement of Series A
Preferred Stock (318,750) (126,350)
------------ ------------
Net (loss) applicable to common
shareholders $ (1,319,335) $ (2,899,697)
============ ============
Net (loss) per share $ (.11) $ (.29)
============ ============
Average common shares outstanding 11,595,400 9,930,777
============ ============
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE> 4
THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1996 1995
---- ----
<S> <C> <C>
Revenues $ 457,873 $ 322,846
Film amortization 20,000 502,018
------------ ------------
437,873 (179,172)
Write down of film costs to net
realizable values -- 937,298
General and administrative expenses 881,590 1,703,368
------------ ------------
Operating (loss) (443,717) (2,819,838)
Income from settlement of lawsuits 50,000 --
Forgiveness of note receivable from
related party (68,016) --
Provision for note receivable -- (270,000)
Reduction in deferred participations -- 200,000
Interest income 24,852 14,820
------------ ------------
Net (loss) (436,881) (2,875,018)
Dividend requirement of Series A
Preferred Stock (106,250) (106,250)
------------ ------------
Net (loss) applicable to common
shareholders $ (543,131) $ (2,981,268)
============ ============
Net (loss) per share $ (.04) $ (.29)
============ ============
Average common shares outstanding 12,858,900 10,266,334
============ ============
</TABLE>
See notes to condensed consolidated financial statements.
4
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THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
NINE MONTHS ENDED MARCH 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Additional
Preferred Common Paid-In
Stock Stock Capital Deficit Net
----- ----- ------- ------- ---
<S> <C> <C> <C> <C> <C>
Balance, June 30,
1995 $1,000 11,389 15,321,214 (11,735,044) 3,598,559
------ ------ ---------- ----------- ------------
Issuance of common
stock in payment
of dividends on
Series A preferred
stock 605 (605)
Sale of shares of
common stock to
related parties
for notes 2,100 782,900 785,000
Net (loss) (1,000,585) (1,000,585)
------ ------ ---------- ----------- ------------
Balance,
March 31,
1996 $1,000 14,094 16,103,509 (12,735,629) 3,382,974
====== ====== ========== ============ ===========
Less:
Treasury stock (1,010,192)
Notes receivable
from related parties
from sales of common
stock, net (824,000)
-----------
Net Shareholders' Equity $ 1,548,782
===========
</TABLE>
See notes to condensed consolidated financial statements.
5
<PAGE> 6
THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine months ended March 31,
-----------------------------
1996 1995
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net (loss) $(1,000,585) $(2,773,347)
Adjustments to reconcile net (loss)
to net cash used in operating activities:
Depreciation and amortization 742,115 2,825,343
Income from settlement of lawsuits (137,633) --
Forgiveness of note receivable from
related party 68,016 --
Amortization of imputed interest discount (39,000) --
Allowance for amounts receivable -- 270,000
Reduction in deferred participations -- (200,000)
Write down of film costs -- 937,298
Issuance of shares of stock for interest -- 275,000
Changes in assets and liabilities:
Decrease in receivables 115,295 334,117
(Increase) in other assets (13,278) (2,472)
Increase (decrease) in accounts payable
and accrued expenses 115,468 (484,424)
(Decrease) in deferred revenues (598,708) (3,327,901)
----------- -----------
Net cash (used in) operating activities (748,310) (2,146,386)
----------- -----------
Cash flows from investing activities:
Additions to film costs, net of receipts (129,347) (1,240,767)
Capital expenditures (7,166) (9,913)
Decrease (increase) in due from related
parties 33,337 (286,275)
----------- -----------
Net cash (used in) investing activities (103,176) (1,536,955)
----------- -----------
Cash flows from financing activities:
Sale of units in public offering -- 4,176,467
Borrowings (repayments), net 100,000 (588,750)
Proceeds from exercise of stock options -- 454,375
----------- -----------
Net cash provided by financing activities 100 000 4,042,092
----------- -----------
Net increase (decrease) in cash (751,486) 358,751
Cash at beginning of period 832,754 964,387
----------- -----------
Cash at end of period $ 81,268 $ 1,323,138
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements.
6
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SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
As disclosed in note (2), during the nine months ended March 31, 1996,
the Company sold an aggregate of 2,100,000 shares of its common stock to related
parties in exchange for promissory notes.
As disclosed in note (3), the Company has settled various litigation
relating to DSL.
As disclosed in note (7) the Company has reduced the cost of certain of
its completed projects by $235,622.
As disclosed in note (9), during the nine months ended March 31, 1996,
the Company issued a total of 605,167 shares of its common stock in payment of
dividends on its Series A Preferred Stock.
7
<PAGE> 8
THE PRODUCERS ENTERTAINMENT GROUP LTD. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
March 31, 1996
(1) Basis of Presentation
The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normal recurring
accruals) which are, in the opinion of management, necessary to present fairly
the results of operations for the periods presented.
The information contained in this Form 10-QSB should be read in
conjunction with the audited financial statements filed as part of the Company's
Annual Report on Form 10-KSB for the fiscal year ended June 30, 1995.
(2) Sale of Shares of Common Stock to Related Parties for Notes
As of November 14, 1995, the Company sold an aggregate of 2,100,000
shares of its common stock to related parties in exchange for an aggregate of
$1,050,000 principal amount of promissory notes. Of these shares, 2,000,000 were
sold to a company (the "Loan-Out Company") that provides the Company with the
services of its President and Chief Executive Officer. The 100,000 balance of
these shares was sold to a then officer and director of the Company.
The principal amounts of the promissory notes received by the Company
are payable as follows: April 1, 1997 - $131,250; October 1, 1998 - $131,250;
and October 1, 2000 - $787,500. Interest on these notes is computed at an annual
rate of 7%, compounded semi-annually and is payable with the principal of the
notes. The notes are secured by the purchased shares with the personal liability
of the purchaser limited to 25% of the principal amount (aggregate- $262,500)
plus accrued interest thereon.
A portion of the shares purchased by the Loan-Out Company are subject
to forfeiture to the Company (with a corresponding reduction in the promissory
note issued by the Loan-Out Company in payment for such shares) in the event the
employment of the Company's Chief Executive Officer is terminated (other than
termination as a result of his death or disability, termination by the Company
without cause, or termination by the Company or the executive under certain
circumstances following a change in control of the Company) prior to the
applicable vesting date of such shares. Of such shares, 50% vested on April 1,
1996, 25% will vest on June 30, 1996, and 25% will vest on June 30, 1997. The
vesting and forfeiture provisions applicable to the 100,000 shares sold to the
other officer were waived by the Company in connection with the resignation of
such officer from the Company in April 1996.
The promissory notes received by the Company were recorded at their
principal amount less an imputed interest discount in the aggregate amount of
approximately $265,000. This imputed interest discount is being amortized over
the term of the notes using the interest method to provide an effective interest
rate of 12% per annum. During the nine months ended March 31, 1996, the Company
recorded approximately $39,000 of interest income on these notes. The difference
between this imputed interest rate and the stated interest rate on the notes may
be deemed to be additional compensation to the purchasers of the shares.
(3) Settlement of Litigation
During the nine months ended March 31, 1996, the Company settled
various litigation relating to DSL Productions, Inc., a wholly-owned subsidiary
of the Company ("DSL"). In pertinent part, this settlement provided for the
payment to
8
<PAGE> 9
the Company of $308,000 (of which $130,000 has been received), elimination of
the $402,842 note receivable from the former President of DSL, the transfer of a
completed project with a carrying amount of $222,980 to a new corporation formed
by the former President of DSL ("DEG") and the release of the Company's $350,000
obligation to pay a portion of future revenues from completed projects to the
former owner of DSL. In connection with this settlement, the Company reduced its
accounts payable and accrued expenses by $235,455 representing the amounts
previously recorded related to DSL and this litigation. This settlement also
provided for a reduction in the Company's ownership of DEG from 19.9% to 5%. The
effects of this settlement have been reflected in the accompanying condensed
consolidated statements of operations as a separate item.
(4) Forgiveness of Note Receivable from Related Party
During the nine months ended March 31, 1996, the Company forgave the
note receivable and accrued interest thereon in the aggregate amount of $68,016
which was due from a company that formerly provided the services of the
Company's President and Chief Executive Officer and others.
(5) Employment Agreements
During the nine months ended March 31, 1996, the Company entered into
agreements for the services of its President and Chief Executive Officer and
others. These agreements expire on June 30, 1998 and provide for aggregate
annual payments by the Company of $330,000.
(6) Litigation With Former Officer and Director
As of November 14, 1995, in connection with the following employment
arrangement, the Company sold 1,500,000 shares of its common stock to one of its
then officers and directors in exchange for $750,000 principal amount of
promissory notes. This sale was made on the same terms as the sale of shares as
described in note (2). The Company also executed a purported employment
agreement (which was not approved or ratified by the Company's Board of
Directors) with this officer and director which provided for, among other
things, annual compensation of $262,000 through June 30, 1998.
In December 1995, the Company terminated the employment of this
individual and the related purported employment agreement. As a result of such
termination, the shares of common stock sold to this individual and the related
notes received by the Company for such shares were forfeited to the Company and
cancelled. The Company subsequently filed a legal action against this individual
claiming, among other things, breach of fiduciary duty and return of amounts
previously paid. This individual has filed a cross-complaint against the Company
and its President and Chief Executive Officer claiming, among other things, that
his employment with the Company was improperly terminated and his employment
stock purchase agreements were improperly cancelled. This cross-complaint seeks
substantial damages.
9
<PAGE> 10
(7) Reduction of Film Costs
During the nine months ended March 31, 1996, the Company reduced the
carrying amount of certain of its completed projects by $235,622 representing
the amount previously recorded as accounts payable and accrued expenses for
additional estimated expenditures relating to these projects that were not
incurred.
(8) Note Payable to Related Parties
On March 25, 1996, the Company borrowed $100,000 from related parties
pursuant to an unsecured promissory note which bears interest at the prime rate
plus 1% and is due on June 30, 1996. This note was subsequently repaid from the
proceeds of a note issued to an unrelated party which is payable on June 24,
1996 (subject to mandatory prepayment in certain events), bears interest at the
annual rate of 10% and is secured by the Company's participation in the revenue
earned from a currently airing television series.
(9) Issuance of Shares of Common Stock for Preferred Stock Dividend
During the nine months ended March 31, 1996, the Company issued an
total of 605,167 shares of its common stock in payment of the dividend on its
Series A Preferred Stock.
(10) (Loss) Per Share
(Loss) per share has been computed based on the weighted average number
of common and common equivalent shares outstanding during the periods after
deducting the dividend requirement of the Series A Preferred Stock.
(11) Stock Options
During the nine months ended March 31, 1996 an aggregate of 1,611,999
stock options at exercise prices ranging from $1.00 to $3.25 per share expired
or were cancelled. During this period, the Company granted an aggregate of
450,000 stock options at exercise prices of $.50 and $.55 per share.
(12) Proposed Reverse Split of Common Stock
The Board of Directors of the Company has approved a one for four
reverse split of the Company's common stock subject to shareholder approval. No
effect has been given to this proposed reverse stock split in the accompanying
condensed consolidated financial statements and notes.
10
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Amounts received as license fees for projects in production are
deferred until the project becomes available for broadcast in accordance with
the terms of the licensing agreement and are recognized as revenues at such
time. Additional licensing and distribution fees are recognized as earned in
accordance with the terms of the related agreements. Revenues from the sale of
completed projects are recognized upon their sale.
The Company's revenues are principally derived from distribution of
completed projects, producers fees and personal management fees. The amount of
revenues earned by the Company in any one period is dependent on, among others,
projects completed during any such period and the distribution of completed
projects. Revenues from producers and other fees are primarily dependent on the
number of projects being produced and the agreements relating to such projects.
Accordingly, the amount of revenues in any period are not necessarily indicative
of future revenues.
NINE MONTHS ENDED MARCH 31, 1996 AS COMPARED TO NINE MONTHS ENDED MARCH 31, 1995
Revenues for the nine months ended March 31, 1996 included revenues
from the distribution of completed projects, producer fees from currently airing
television series and a made-for-television movie which is in the production
stage, and personal management fees. Revenues for the nine months ended March
31, 1995 included production and distribution revenues, fees received from a
television series and personal management fees. Included in revenues for the
nine months ended March 31, 1995 is approximately $3,607,000 related to the
completion of the television series Future Quest which aired on PBS.
Amortization of film costs for the nine months ended March 31, 1996 and 1995 was
$717,000 and $2,808,752, respectively, using the individual film forecast
method.
11
<PAGE> 12
General and administrative expenses for the nine months ended March 31,
1996 were $2,665,625 as compared to $3,660,150 for the nine months ended March
31, 1995. The $994,525 decrease in general and administrative expenses was
primarily attributable to the termination of certain unprofitable operations of
DSL, including related compensation and other expenses, somewhat offset by legal
fees incurred in connection with lawsuits with the former President and owner of
DSL.
During the nine months ended March 31, 1996 the Company agreed to
settle various litigation relating to DSL. See note (3). The Company has
recorded $267,663 of income relating to this settlement. During the nine months
ended March 31, 1996, the Company forgave the note receivable and accrued
interest (aggregate - $68,016) that was due from a company that formerly
provided the Company with the services of its present President and Chief
Executive Officer and others.
During the nine months ended March 31, 1996, the Company recorded
$39,000 of interest income on notes receivable from related parties that were
received in connection with sales of the Company's common stock. Exclusive of
this interest income, the decrease in interest income was primarily due to a
reduction in funds available for investment and lower interest rates. Interest
and financing expense for fiscal 1995 primarily consists of interest paid on the
Company's 7% subordinated notes including $275,000 representing the market value
of the shares of common stock issued to the noteholders upon the repayment of
the notes in December 1994.
THREE MONTHS ENDED MARCH 31, 1996 AS COMPARED TO THREE MONTHS ENDED
MARCH 31, 1995
Revenues for the three months ended March 31, 1996 primarily consisted
of producer fees from currently airing television series and a
made-for-television movie which is in the production stage and personal
management fees. Revenues for the three months ended March 31, 1995 primarily
consisted of production and distribution revenues from completed projects,
producer fees from a television series and personal management fees.
Amortization of film costs for the three months ended March 31, 1996 and 1995
was $20,000 and $502,018, respectively.
General and administrative expenses for the three months ended March
31, 1996 were $881,590 as compared to $1,703,368 for the three months ended
March 31, 1995. The decrease in general and administrative expenses of $821,778
was primarily attributable to the termination of certain unprofitable operations
of DSL, including related compensation and other expenses, offset by legal fees
incurred in connection with lawsuits with the former President and owner of DSL.
During the three months ended March 31, 1996, the Company recorded
$24,000 of interest income on notes receivable from related parties that were
received in connection with sales of the Company's common stock. During the
three months ended March 31, 1996, the Company forgave the note receivable and
accrued interest (aggregate - $68,016) that was due from a company that formerly
provided the Company with the services of its President and Chief Executive
Officer and others.
12
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LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 1996, the Company had cash of $81,268 and accounts
receivable of $714,718 (aggregate - $795,986). At such date,the Company also had
accounts payable and accrued expenses of $491,986 and a note payable of $100,000
(aggregate - $591,916).
The Company's cash commitments for the twelve months ending March 31,
1997 include base compensation to its officers and key independent contractors
of approximately $754,000, office rent of approximately $230,000 and a note
payable of $100,000 (aggregate -
approximately $1,084,000). The lease for the Company's office has been extended
to September 30, 1997. The Company also incurs other costs such as salaries,
related benefits, office expenses, professional fees and similar expenses.
General and administrative expenses, including compensation to officers and key
independent contractors, aggregated approximately $2,665,000 for the nine months
ended March 31, 1996.
The Company's cash receipts are principally derived from exhibition and
distribution of its completed projects, producers fees and personal management
fees. The Company's cash receipts are affected by various factors including the
timing of the exhibition and distribution of its completed projects and the
number of projects produced for which the Company receives producers fees.
Therefore, the Company is unable to accurately predict the level or timing of
its future cash receipts.
For the nine months ended March 31, 1996, the Company's cash receipts
were primarily derived from producers fees from currently airing television
series, personal management fees and a producer's fee from a made-for-television
movie which is in the production stage. This movie is being produced by the
Company pursuant to an agreement which provides for payments to the Company for
production costs. Included in accounts payable and accrued expenses at March 31,
1996 is approximately $298,000 representing the excess of payments received over
amounts expended on production of this movie. The Company will be required to
expend funds to complete this movie. Cash received from the distribution of the
Company's completed projects aggregated approximately $389,000 for the nine
months ended March 31, 1996. As of March 25, 1996, the Company borrowed $100,000
from related parties for working capital purposes. As disclosed in note (8),
this note was subsequently repaid from the proceeds of a note issued to an
unrelated party.
The Company is obligated to pay dividends on the shares of Series A
Preferred Stock which were sold in its December 1994 public offering. Dividends
on this Series A Preferred Stock, which aggregate $425,000 annually, may be paid
in shares of the Company's common stock. During the nine months ended March 31,
1996, the Company issued an aggregate of 605,167 shares of its common stock in
payment of dividends on this preferred stock through December 31, 1995.
During the nine months ended March 31, 1996, the Company's cash
receipts and cash balance at June 30, 1995 were primarily used for the payment
of general and administrative expenses, including compensation to its officers
and key
13
<PAGE> 14
independent contractors.
The Company's operations have been primarily financed by the net
proceeds received from public offerings of its securities and exercise of stock
options and warrants. As of March 31, 1996, the Company's outstanding stock
options and warrants were exercisable at prices substantially above the market
price of the Company's common stock.
For the nine months ended March 31, 1996, the Company incurred an
operating loss of $1,249,858, a net loss of $1,000,585 and used $748,310 of cash
in its operations. Included in the Company's net loss is $68,016 representing
the forgiveness of a note receivable from a related party.
If the Company's future cash receipts are not sufficient to pay its
general and administrative expenses, the Company will be required to take
certain steps if it is to continue to be a going concern. These actions may
include reductions in compensation of its officers and key independent
contractors by amending the terms of their existing employment agreements. As of
March 31, 1996, none of these employment agreements had been amended.
The Company has no arrangements for external sources of liquidity such
as bank lines of credit. The Company is presently seeking other sources of
external financing to be used for payment of operating expenses and production
of projects. This external financing may be in the form of loans and/or sales of
equity securities. No agreements have been entered into for any such external
financing.
If the Company continues to incur cash losses and if external sources
of funds are not available to the Company to offset these cash losses, there
will be substantial doubts about the Company's ability to continue as a going
concern.
14
<PAGE> 15
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Producers Entertainment Group Ltd. vs. Ronald Lightstone was
commenced in the Superior Court of the State of California for the County of Los
Angeles on January 3, 1996. In this action, the Company claims, among other
things, that Mr. Lightstone breached his fiduciary duty to the Company and seeks
return of amounts previously paid to him. On January 8, 1996, Mr. Lightstone
filed a cross-complaint in the same court entitled Ronald Lightstone vs. The
Producers Entertainment Group Ltd, Irwin Meyer, et.al. In his cross-complaint,
Mr. Lightstone claims, among other things, that his employment with the Company
was improperly terminated and his purported employment and stock purchase
agreements with the Company were improperly cancelled. Mr. Lightstone's
cross-complaint seeks substantial damages.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(b) Reports on Form 8-K - No reports on Form 8-K were filed during the
three months ended March 31, 1996.
15
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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.
THE PRODUCERS ENTERTAINMENT GROUP LTD.
Date: May 10, 1996 /s/ Irwin Meyer
---------------
Irwin Meyer
President and Chief
Executive Officer
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (A) THE
COMPANY'S QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTER ENDED MARCH 31, 1996
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH (B) FORM 10-QSB
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> MAR-31-1996
<CASH> 81,268
<SECURITIES> 0
<RECEIVABLES> 729,655
<ALLOWANCES> 0
<INVENTORY> 3,209,942
<CURRENT-ASSETS> 0
<PP&E> 58,490
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,292,462
<CURRENT-LIABILITIES> 591,986
<BONDS> 0
0
1,000
<COMMON> 14,094
<OTHER-SE> 1,533,688
<TOTAL-LIABILITY-AND-EQUITY> 4,292,462
<SALES> 2,132,767
<TOTAL-REVENUES> 2,132,767
<CGS> 717,000
<TOTAL-COSTS> 717,000
<OTHER-EXPENSES> 2,665,625
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,000,585)
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</TABLE>
