FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended December 31, 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: 1-10781
LANCIT MEDIA ENTERTAINMENT, LTD.
(Exact Name of Registrant as Specified in its Charter)
New York 13-3019470
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
601 West 50th Street, New York, New York, 10019
(Address of Principal Executive Office) (Zip Code)
(212) 977-9100
(Registrant's telephone number including area code)
Lancit Media Productions, Ltd.
(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 preceding 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 The number of shares of registrant's Common Stock, $.001 par
value, outstanding as of December 31, 1996 was 6,626,750 shares.
<PAGE>
LANCIT MEDIA ENTERTAINMENT, LTD. AND SUBSIDIARIES
INDEX
PAGE
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET - December 31,
1996 and June 30, 1995 1
CONSOLIDATED STATEMENT OF OPERATIONS - For the
six and three months ended December 31, 1996
and 1995 2
CONSOLIDATED STATEMENT OF CASH FLOWS - For the
six months ended December 31, 1996 and 1995 3
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 4
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS 5 - 8
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS 9
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 10
SIGNATURES 11
<PAGE>
PART I. FINANCIAL INFORMATION
LANCIT MEDIA ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
December 31, June 30,
1996 1996
------------ -----------
(UNAUDITED)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 6,713,359 $ 3,358,230
Accounts receivable 2,086,705 2,683,433
Film and program costs, net 6,373,818 5,527,106
Prepaid expenses 190,710 268,175
------------ -----------
TOTAL CURRENT ASSETS 15,364,592 11,836,944
ACCOUNTS RECEIVABLE - NON-CURRENT 899,417 1,378,078
FIXED ASSETS, NET 651,597 832,606
GOODWILL, NET 271,528 279,754
DEPOSITS 48,363 60,784
------------ -----------
TOTAL ASSETS $ 17,235,497 $ 14,388,166
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 1,028,173 $ 732,158
Participation payable 1,144,463 1,199,991
Deferred revenue 1,301,843 1,651,279
------------ -----------
TOTAL CURRENT LIABILITIES 3,474,479 3,583,428
------------ -----------
PARTICIPATION PAYABLE - NON-CURRENT 539,141 598,461
DEFERRED REVENUE - NON-CURRENT 559,625 828,713
COMMITMENTS AND CONTINGENCIES
MINORITY INTEREST 145,657 94,056
------------ -----------
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value, authorized
15,000,000 shares; issued and
outstanding 6,626,750 shares at
December 31, 1996 and 6,187,634
shares at June 30, 1996 6,627 6,188
Additional paid-in capital 17,279,964 12,579,402
Retained earnings (accumulated deficit) (4,769,996) (3,302,082)
------------ -----------
TOTAL STOCKHOLDERS' EQUITY 12,516,595 9,283,508
------------ -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$ 17,235,497 $ 14,388,166
============ ===========
See notes to consolidated financial statements.
- 1 -
<PAGE>
LANCIT MEDIA ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
------------------- ---------------------
1996 1995 1996 1995
-------- ------- --------- --------
(UNAUDITED) (UNAUDITED)
REVENUES:
Production and royalties $ 179,183 $1,970,662 $ 746,008 $4,721,966
Licensing agent fees 319,875 766,542 643,875 1,338,386
-------- --------- --------- ---------
499,058 2,737,204 1,389,883 6,060,352
-------- --------- --------- ---------
OPERATING EXPENSES:
Production and royalties 448,377 1,911,607 978,991 4,260,208
Licensing agent - direct costs 206,264 279,626 440,248 583,958
General and administrative 786,354 651,091 1,500,770 1,357,211
-------- --------- --------- ---------
1,440,995 2,842,324 2,920,009 6,201,377
--------- --------- --------- ---------
INCOME (LOSS) FROM OPERATIONS (941,937) (105,120)(1,530,126) (141,025)
INTEREST INCOME (EXPENSE) - NET 79,690 76,365 113,813 173,795
-------- ------- --------- ---------
INCOME (LOSS) BEFORE PROVISION FOR
INCOME TAXES AND MINORITY INTEREST(862,247) (28,755)(1,416,313) 32,770
PROVISION FOR INCOME TAXES - CURRENT - 13,790 - 20,990
MINORITY INTEREST 23,518 106,370 51,601 125,119
-------- ------- --------- --------
NET INCOME (LOSS) $ (885,765) $ (148,915)$(1,467,914) $(113,339)
======== ======== ========= ========
NET INCOME (LOSS) PER SHARE $ (0.13) $ (0.02)$ (0.23) $ (0.02)
======== ======== ========= ========
WEIGHTED AVERAGE SHARES 6,626,750 6,177,634 6,443,952 6,172,634
========= ========= ========= =========
See notes to consolidated financial statments.
- 2 -
<PAGE>
LANCIT MEDIA ENTERTAINMENT, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED
DECEMBER 31,
--------------------------
1996 1995
---------- ----------
(UNAUDITED)
CASH FLOW FROM OPERATING ACTIVITIES:
Net income (loss) $(1,467,914) $ (113,339)
----------- ----------
Adjustments to reconcile net
income (loss) to net cash from operating
activities:
Amortization of film and program costs 207,231 2,818,500
Depreciation and other amortization 197,644 211,972
Minority interest 51,601 125,119
Changes in operating assets and liabilities:
(Increase) decrease in accounts
receivable - current 596,728 405,744
(Increase) decrease in accounts
receivable - non-current 478,661 592,079
Additions to film and program costs (1,053,943) (4,287,099)
(Increase) decrease in prepaid expenses 77,465 (20,013)
(Increase) decrease in income taxes receivable - 434
(Increase) decrease in deposits receivable 12,421 (1,500)
Increase (decrease) in accounts payable
and accrued expenses 296,015 128,055
Increase (decrease) in participations
payable - current (55,528) 231,796
Increase (decrease) in participations
payable - non-current (59,320) 8,901
Increase (decrease) in income taxes payable - (6,334)
Increase (decrease) in deferred revenue - current (349,436) (2,087,686)
Increase (decrease) in deferred
revenue - non-current (269,088) (654,281)
----------- -----------
130,451 (2,534,313)
----------- -----------
CASH PROVIDED (USED) IN OPERATING ACTIVITIES (1,337,463) (2,647,652)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (8,409) (117,257)
----------- -----------
CASH PROVIDED (USED) IN INVESTING ACTIVITIES (8,409) (117,257)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 4,701,001 200
----------- -----------
CASH PROVIDED (USED) IN FINANCING ACTIVITIES 4,701,001 200
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 3,355,129 (2,764,709)
CASH AND CASH EQUIVALENTS - beginning of period 3,358,230 7,395,238
----------- -----------
CASH AND CASH EQUIVALENTS - end of period $6,713,359 $ 4,630,529
========== ===========
CASH PAID DURING THE PERIOD FOR:
Interest $ -- --
========== ===========
Income taxes $ -- $ 17,228
========== ===========
See notes to consolidated financial statements.
- 3 -
LANCIT MEDIA ENTERTAINMENT, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1996
(UNAUDITED)
1. BASIS OF PRESENTATION
Reference is made to the Company's annual report on Form 10-K /A dated October
28, 1996 for the year ended June 30, 1996.
The accompanying financial statements reflect all adjustments which, in the
opinion of management, are necessary for a fair presentation of the financial
position and results of operations for the interim periods presented. All such
adjustments are of a normal and recurring nature. The results of operations for
any interim period are not necessarily indicative of the results of a full
fiscal year.
2. NET INCOME (LOSS) PER SHARE
Net income (loss) per share is computed on the basis of the weighted average
number common shares and common share equivalents outstanding for the respective
period. Common share equivalents include dilutive stock options and warrants
using the treasury stock method.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations - Three months ended December 31, 1996 as compared to
three months ended December 31, 1995
Production and royalty revenues for the three month period ended December 31,
1996 decreased to $179,183 from $1,970,662 in the comparable 1995 quarter. This
decrease is primarily the result of reduced production and royalty activity on
THE PUZZLE PLACE(R) and reduced production activity on READING RAINBOW.
Licensing agent fee revenues for the three month period ended December 31, 1996
decreased to $319,875 from $766,542 in the comparable 1995 quarter. This
decrease is primarily the result of reduced royalties, and the adjustment of the
licensing terms for several licensees, on THE PUZZLE PLACE(R) and reduced
royalties on the SONIC THE HEDGEHOG(TM) property.
Production and royalty expenses for the three month period ended December 31,
1996 decreased to $448,377 from $1,911,607 in the comparable 1995 quarter
reflecting primarily the decreased production and royalty activity on THE PUZZLE
PLACE(R) and reduced production activity on READING RAINBOW.
Direct costs of licensing activities for the three month period ended December
31, 1996 decreased to $206,264 from $279,626 in the comparable 1995 quarter
primarily as a result of reduced personnel and travel costs.
General and administrative expenses for the three month period ended December
31, 1996 rose to $786,354 from $651,091 in the comparable 1995 quarter. This
increase is due primarily to a reduction in personnel costs, office expenses and
facilities costs being absorbed by project activities.
Interest income for the three month period ended December 31, 1996 remained
virtually unchanged at $79,690 compared to $76,365 in the comparable 1995
quarter.
There was no provision for income taxes recorded for the three month period
ended December 31, 1996 compared to $13,790 for state and local taxes recorded
in the comparable 1995 quarter.
Minority interest in licensing activities for the three month period ended
December 31, 1996 decreased to $23,518 compared to $106,370 in the comparable
1995 quarter.
Net loss for the three month period ended December 31, 1996 was $885,765 ($.13
per share) compared to a net loss of $148,915 ($.02 per share) in the comparable
1995 quarter primarily as a result of the combination of all factors discussed
above. Weighted average shares outstanding for the three month period ended
December 31, 1996 increased to 6,626,750 from 6,177,634 in the comparable 1995
quarter primarily as a result of the issuance of shares related to the purchase
of a 6.6% equity stake in the Company by Discovery Communications, Inc. ("DCI")
in September 1996 as well as the exercise of stock options during the twelve
month period since December 31, 1995.
Results of Operations - Six months ended December 31, 1996 as compared to six
months ended December 31, 1995
Production and royalty revenues for the six month period ended December 31, 1996
decreased to $746,008 from $4,721,966 in the comparable 1995 six month period.
This decrease is primarily the result of reduced production and royalty activity
on THE PUZZLE PLACE(R) and reduced production activity on BACKYARD SAFARI(TM)
and READING RAINBOW.
Licensing agent fee revenues for the six month period ended December 31, 1996
decreased to $643,875 from $1,338,386 in the comparable 1995 six month period.
This decrease is primarily the result of reduced royalties, and the adjustment
of the licensing terms for several licensees, on THE PUZZLE PLACE(R) and
reduced royalties on the SONIC THE HEDGEHOG(TM) property.
Production and royalty expenses for the six month period ended December 31, 1996
decreased to $978,991 from $4,260,208 in the comparable 1995 six month period
reflecting primarily the decreased production and royalty activity on THE PUZZLE
PLACE(R) and reduced production activity on READING RAINBOW.
Direct costs of licensing activities for the six month period ended December 31,
1996 decreased to $440,248 from $583,958 in the comparable 1995 six month period
primarily as a result of reduced personnel and travel costs.
General and administrative expenses for the six month period ended December 31,
1996 rose to $1,500,770 from $1,357,211 in the comparable 1995 six month period.
This increase is due primarily to a reduction in personnel costs and facilities
costs being absorbed by project activities.
Interest income for the six month period ended December 31, 1996 decreased to
$113,813 from $173,795 in the comparable 1995 six month period. This decrease is
primarily due to a reduced level of cash invested, during the earlier part of
the fiscal year, resulting from the Company's utilization of cash for
production, development and corporate needs.
There was no provision for income taxes recorded for the six month period ended
December 31, 1996 compared to $20,990 for state and local taxes in the
comparable 1995 six month period.
Minority interest in licensing activities for the six month period ended
December 31, 1996 resulted in an expense in the amount of $51,601 compared to an
expense in the amount of $125,119 in the comparable 1995 six month period.
Net loss for the six month period ended December 31, 1996 was $1,467,914 ($.23
per share) compared to net loss of $113,339 ($.02 per share) in the comparable
1995 six month period primarily as a result of the combination of all factors
discussed above. Weighted average shares outstanding for the six month period
ended December 31, 1996 increased to 6,443,952 from 6,172,634 in the comparable
1995 six month period primarily as a result of the issuance of shares related to
DCI's purchase of its 6.6% equity stake in the Company as well as the exercise
of stock options during the twelve month period since December 31, 1995.
Liquidity and Capital Resources
The Company's balance sheet remains in strong condition with cash and cash
equivalents as of December 31, 1996 of approximately $6.7 million, a current
ratio of 4.4 to 1 and no long-term debt.
Cash used in operating activities was approximately $1.3 million for the six
month period ended December 31, 1996, compared to approximately $2.6 million for
the same period last year. A net loss of approximately $1.5 million for the six
month period ended December 31, 1996, net additions to film and program costs of
approximately $0.8 million and a decrease in deferred revenues of approximately
$0.6 million were partially offset by a decrease in accounts receivable of
approximately $1.1 million, an increase in accounts payable and accrued expenses
of approximately $0.3 million and depreciation and other amortization of
approximately $0.2 million.
Cash used in investing activities was approximately $8,000, for the six month
period ended December 31, 1996, compared to approximately $117,000 for the same
period last year. The Company acquired equipment during the first six months of
fiscal 1996 as part of its expansion of post production capabilities as well as
the improvement of its management information systems.
Cash provided from financing activities was approximately $4.7 million for the
six month period ended December 31, 1996 compared to $200 for the same period
last year. In September 1996, DCI invested $5 million, which was partially
offset by costs relating to the transaction, for a 6.6% equity stake in the
Company.
As of December 31, 1996 the Company is continuing the remaining elements
associated with the outreach for the first 65 episodes of THE PUZZLE PLACE(R).
The Company estimates that, after it receives the balance of the underwriting
monies due, its remaining funding requirement will be less than $0.1 million.
With respect to THE PUZZLE PLACE(R) licensing effort, the Company and KCET have
agreed to, and may in the future, adjust the licensing terms for certain
licensees in order to more closely reflect the anticipated royalty stream
generated by those particular categories.
The Company is completing production and post production on the initial season
of 13 episodes of BACKYARD SAFARI, which is being partially funded through a
major grant from the National Science Foundation. The Company is continuing to
pursue additional production funding from potential production partnerships and
broadcast license fees as well as various sources of underwriting. Only in the
event the Company were to receive no amounts from these sources of outside
production funding, the Company estimates that its remaining investment required
for this project could be, at the Company's election, up to $0.4 million to
cover primarily outreach and promotion activities.
In September 1996, Discovery Communications, Inc. invested $5 million in the
Company in return for a 6.6% equity stake in Lancit. DCI may also purchase, what
currently represents, an additional 6.2% stake in the Company through the
exercise of warrants at $13 per share. Management believes that its present cash
position and strong liquidity will enable the Company to meet its current
capital requirements. In the event the Company aggressively pursues growth
opportunities which could arise over the foreseeable future, additional capital
may be required. The Company and its investment banker, Allen & Co., may pursue
additional strategic alliances which present a source of capital and attractive
business opportunities for the Company. Management does not expect inflation to
have a significant impact on the business.
CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This report, including, without limitation, descriptions of the Company's
targets or goals and Management's views concerning the Company's pending and
proposed projects and future financial performance contained in this discussion
and analysis and elsewhere, constitute forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 and involve known and unknown risks and uncertainties which may cause the
Company's actual results in future periods to differ materially from forecasts.
These risks include, among others, network and studio acceptance of television
and motion picture projects; the ability of the Company to secure timely
production funding; less than anticipated consumer acceptance of entertainment
projects or licensed products, as well as risks generally associated with the
production of a television series, movie or other entertainment project. These
and other risks are described in the Company's Annual Report on Form 10-K/A
filed with the Securities and Exchange Commission, copies of which are available
from the SEC or may be obtained upon request from the Company.
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
A) The Registrant's annual meeting was held on December 18, 1996.
B) Laurence A. Lancit, Cecily Truett, Marc L. Bailin, John R.
Costantino and Joseph Kling, constituting the entire board of
directors were elected as directors at such meeting for a one
year term.
C) At such meeting, the following items were submitted to a vote
of security holders:
1) The election of the following directors:
For Withhold
L. Lancit 6,031,990 72,340
C. Truett 6,031,389 72,941
M. Bailin 6,033,990 70,340
J. Kling 6,032,140 72,190
J. Costantino 6,033,365 70,965
2) An amendment to paragraph 1 of the Certificate of
Incorporation of the Company changing the name of the
Company to "Lancit Media Entertainment, Ltd."
For Against Abstain
6,080,669 16,666 6,995
<PAGE>
ITEM 5. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits Sequential
Page No.
3.1 Certificate of Incorporation, as amended 12
b) Reports on Form 8-K
Not Applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
LANCIT MEDIA ENTERTAINMENT, LTD.
Date: February 11, 1996 By: /s/Gary Appelbaum
Gary Appelbaum
Senior Vice President, Chief Financial Officer &
Treasurer
Date: February 11, 1996 By: /s/Laurence A. Lancit
Laurence A. Lancit
President and Chief Operating Officer
<PAGE>
CERTIFICATE OF INCORPORATION
OF
LANCIT MEDIA PRODUCTIONS, LTD.
Under Section 402 of the Business Corporation Law
IT IS HEREBY CERTIFIED THAT:
(1) The name of the corporation is:
LANCIT MEDIA PRODUCTIONS, LTD.
(2) The purpose or purposes for which this corporation is
organized are as follows, to wit:
To devise, prepare, publish, print, manufacture, produce, buy, hire or
otherwise acquire, use, sell, lease, license others to use, export, import or
otherwise turn to account or dispose of, exhibit, distribute and deal in audio
or visual productions, including, without limitation, still and motion pictures,
films, microfilms, tapes, sound recordings, mechanical or otherwise, phonograph
records and television productions, and any and all parts, apparatus, equipment,
supplies, materials, chemicals, implements, devices and goods useful in
manufacturing, producing, receiving, collecting, transcribing, reproducing,
exhibiting, transmitting, publishing, broadcasting, telecasting or otherwise
deal with the same.
To acquire by lease, purchase, contract, concession, license or otherwise,
to erect or otherwise construct and to own, use, manage, lease, operate and
control motion picture studios, film branches or exchanges, distributing
centers, warehouses, store rooms, laboratories, film developing and printing
plants, television studios, radio broadcasting and telecasting systems or
stations and other buildings and structures.
To publish, exploit and otherwise deal with musical properties, musical
compositions and rights and interests therein, in the United States, and
throughout the world; to advertise, publicize, revise, alter, modify and
otherwise prepare and act with respect to such musical properties, compositions,
and rights and interests therein; to transcribe, publish, broadcast, telecast,
perform and otherwise act with respect to such musical properties and rights and
interests therein; to employ any and all known mechanical devices which may
hereafter be created, invented, discovered, made, manufactured, and any and all
phases of the operations thereof in the transcribing, transmitting and otherwise
acting with respect to such mechanical properties and rights and interests
therein.
To create, purchase, lease and otherwise acquire or obtain and to own,
hold, sell, publish, lease, license, exchange and otherwise dispose of musical,
dramatico-musical, dramatic, literary, artistic and intellectual works of all
kinds and types, and any and all copyrights, common-law rights and other rights
therein.
To adapt, arrange, translate, perform, print, reprint, dramatize, deliver,
represent, produce, reproduce, exhibit, vend, license, record, copy, and publish
musical, dramatico-musical, dramatic, motion picture, literary, artistic and
intellectual properties, and to circulate, distribute, buy, sell, and otherwise
acquire, dispose of and deal with and in any way to use and to license, permit
and otherwise authorize others to use all or any of the foregoing.
To hire, employ, engage, contract with and otherwise transact business
with, and to represent, manage, and act as agents for composers, authors,
arrangers, artists, musicians, performers, publishers, producers, societies,
associations, and all other types and kinds of persons and organizations for all
and any purposes.
To generally engage in the business of buying, selling, manufacturing,
dealing, operating and acting with respect to machinery and appliances in the
manufacture of any and all articles by and with respect to the use of such
machinery, appliances and tools.
To acquire such property, real and personal, as may be necessary to the
conduct of such business.
The powers, rights and privileges provided in this Certificate of
Incorporation are not to be deemed to be in limitation of similar, other or
additional powers, rights and privileges granted or permitted to a corporation
by the Business Corporation Law, it being intended that this corporation shall
have the right to engage in such similar activities as like corporations may
lawfully engage in under the Business Corporation Law of the State of New York,
as now in effect, or as hereafter promulgated.
To do everything necessary, suitable or proper for the accomplishment,
attainment or furtherance of, to do every other act or thing incidental to,
appurtenant to, growing out of or connected with, the purposes, objects or
powers set forth in this Certificate of Incorporation, whether alone or in
association with others; to possess all the rights, powers and privileges now or
hereafter conferred by the laws of the State of New York and, in general to
carry on any of the activities and to do any of the things herein set forth to
the same extent and as fully as a natural person or partnership might or could
do; provided, that nothing herein set forth shall be construed as authorizing
the corporation to possess any purpose, object or power, or to do any act or
thing forbidden by law to a Corporation organized under the laws of the State of
New York.
(3) The office of the corporation is to be located in the City of New
York, County of New York, State of New York.
(4) The aggregate number of shares which the corporation shall have the
authority to issue is Two Hundred (200) common shares, each of which are to be
without par value.
(5) The Secretary of State is designated as agent of the corporation upon
whom process against it may be served. The post office address to which the
Secretary of State shall mail a copy of any process against the corporation
served upon him is:
c/o Beldock Levine & Hoffman
565 Fifth Avenue
New York, New York 10017
The undersigned incorporator is of the age of eighteen years or over.
IN WITNESS WHEREOF, this certificate has been subscribed this 5th day of
July, 1979 by the undersigned who affirms that the
statements made herein are true under the penalties of perjury.
/s/ Linda Mancuso
99 Washington Ave.
Albany, NY 12210
<PAGE>
CERTIFICATE OF AMENDMENT
OF
THE CERTIFICATE OF INCORPORATION
OF
LANCIT MEDIA PRODUCTIONS, LTD.
Under Section 805 of the Business Corporation Law
of the State of New York
The undersigned, being the president and the secretary of
Lancit Media Productions, Ltd. do hereby certify and set forth:
1. The name of the corporation is Lancit Media
Productions, Ltd.
2. The certificate of incorporation of the corporation was
filed by the Department of State on the 11th day of July 1979.
3. The Certificate of Incorporation is hereby amended to effectuate the
following: (1) to increase the aggregate number of shares authorized and the par
value thereof, (2) to change the number of issued shares and the par value
thereof, (3) to eliminate preemptive rights, (4) to eliminate certain
liabilities of members of the Board of Directors to the corporation or its
stockholders for money damages for certain breaches of fiduciary duty as a
director, and (5) to change the address to which the Secretary of State shall
mail a copy of any process against the corporation.
4. Paragraph "4" of the Certificate of Incorporation which
refers to the authorized stock is hereby amended to read as
follows:
4. The aggregate number of shares which the Corporation shall have
authority to issue is 5 million Common shares of the par value of $.001
per share.
This amendment provides for the following change of shares: The amendment
provides for a change of 200 Common shares of no par value, all of which
are issued. Resulting from the change are 1,583,000 issued Common shares
of the par value of $.001 per share at the rate of 1 for 7.915. The
remaining 3,417,000 Common shares of a par value of $.001 per share are
unissued. 5. Paragraph "5" of the Certificate of Incorporation which
refers to the address for service of process is hereby amended to
read as follows:
5. The Secretary of State is designated as agent of the corporation upon
whom process against it may be served. The post office address to which
the Secretary of State shall mail a copy of any process against the
corporation served upon his is:
c/o Rubin & Bailin
405 Park Avenue, 15th Floor
New York, NY 10022
6. To add a new Paragraph "6" to the Certificate of
Incorporation the following is hereby added to read as follows:
6. No holder of any shares of the corporation shall, because of his
ownership of shares of the corporation, have a preemptive or other right
to purchase, subscribe for, or take any part of any shares of the
corporation, or any part of any notes, debentures, bonds, or other
securities convertible into or providing for options or warrants to
purchase shares of the corporation which are issued, offered, or sold by
the corporation after its incorporation, whether the shares, notes,
debentures, bonds, or other securities be authorized by this certificate
of incorporation or by an amended certificate duly filed and in effect at
the time of the issuance, offer, or sale of such shares, notes,
debentures, bonds, or other securities. Any part of the shares authorized
by this certificate of incorporation or by an amended certificate duly
filed and any part of any notes, debentures, bonds, or other securities
convertible into or providing for options or warrants to purchase shares
of the corporation may at any time be issued, offered for sale, and sold
or disposed of by the corporation, pursuant to a resolution of its Board
of Directors and to such persons and upon such terms and conditions as the
Board of Directors may, in its sole discretion, deem proper and advisable,
without first offering to existing shareholders any part of such shares,
notes, debentures, bonds, or other securities.
7. To add a new Paragraph "7" to the Certificate of
Incorporation, the following is hereby added to read as follows:
7. The personal liability of directors to the corporation or its
shareholders for damages for any breach of duty in such capacity is
eliminated to the fullest extent permitted by law.
8. This amendment to the Certificate of Incorporation of the corporation
was authorized by the unanimous vote of the Board of Directors followed by the
unanimous vote of the holders of all of the outstanding shares entitled to vote
thereon dated as of the 29th day of June, 1990.
IN WITNESS WHEREOF, the undersigned has signed this certificate this 13th
day of August, 1990, and affirm that the statements made herein are true under
the penalties of perjury.
/s/Laurence A. Lancit
Laurence A. Lancit, President
/s/Marc L. Bailin
Marc L. Bailin, Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF
THE CERTIFICATE OF INCORPORATION OF
LANCIT MEDIA PRODUCTIONS, LTD.
* * * * * * * * * *
Under Section 805 of the
Business Corporation Law
1. The name of the corporation is Lancit Media
Productions, Ltd.
2. The Certificate of Incorporation was filed by the
Department of State on June 11, 1979.
3. The amendment to the Certificate of Incorporation effected hereby is
for the purpose of increasing the aggregate number of shares which the
Corporation shall have the authority to issue, by authorizing an additional 5
million Common shares, having a par value of $.001, per share, which Common
shares are of the same class as the presently authorized shares of the
Corporation.
4. Paragraph "4" of the Certificate of Incorporation is
hereby amended to read as follows:
"4. The aggregate number of shares which the
Corporation shall have authority to issue is 10 million
Common shares, having a par value of $.001, per share."
The amendment made hereby does not affect in any manner the presently issued
Common shares of the Corporation and as a result of this amendment, the
Corporation shall have 10 million authorized Common shares, each such share
having a par value of $.001, of which 1,465,840 shares are issued Common shares
and 8,534,160 are unissued Common shares.
5. This amendment to the Certificate of Incorporation of the Corporation
was authorized by the unanimous vote of the Board of Directors, followed by the
vote of the holders of at least two thirds (2/3) of all of the outstanding
shares entitled to vote thereon, dated as of the 29th day of May, 1991.
IN WITNESS WHEREOF, this Certificate of Amendment has been subscribed this
5th day of June, 1991, by the undersigned who affirm that the statements made
herein are true under the penalties of perjury.
/s/Laurence A. Lancit
Laurence A. Lancit, President
/s/Marc L. Bailin
Marc L. Bailin, Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF
THE CERTIFICATE OF INCORPORATION
OF
LANCIT MEDIA PRODUCTIONS, LTD.
(Under Section 805 of the Business Corporation Law)
THE UNDERSIGNED, being the duly elected President and Secretary,
respectively, of Lancit Media Productions, Ltd., a New York corporation (the
"Corporation"), DO HEREBY CERTIFY THAT:
1. The name of the Corporation is:
LANCIT MEDIA PRODUCTIONS, LTD.
2. The Certificate of Incorporation of the
Corporation was filed by the Department of State of the State of
New York on June 11, 1979.
3. The amendment of the Certificate of Incorporation of the
Corporation effected hereby is for the purpose of increasing the aggregate
number of shares of common stock, par value $0.001 per share (the "Common
shares"), of the Corporation which the Corporation shall have the authority to
issue by authorizing an additional five million (5,000,000) Common shares, which
Common shares are of the same class as the presently authorized shares of the
Corporation.
4. Paragraph "4" of the Certificate of Incorporation of
the Corporation is hereby amended to read in its entirety as
follows:
"4. The aggregate number of shares which the
Corporation shall have the authority to issue is
15,000,000 common shares, having a par value of $0.001
per share."
5. The amendment of the Certificate of Incorporation of the Corporation
made hereby does not affect in any manner the presently issued Common Shares and
as a result of such amendment as of the date hereof the Corporation will have
15,000,000 authorized Common shares, of which 6,177,634 Common shares are issued
and outstanding and 8,822,366 are unissued.
6. The amendment of the Certificate of Incorporation of the Corporation
made hereby was authorized by the unanimous written consent of the Board of
Directors of the Corporation in lieu of a special meeting thereof dated October
10, 1995, followed by the affirmative vote of the holders of at least a majority
of all the outstanding Common shares entitled to vote thereon at the Annual
Meeting of the Shareholders of the Corporation on December 7, 1995.
IN WITNESS WHEREOF, this Certificate of Amendment has been subscribed this
7th day of December, 1995 by the undersigned who affirm that the statements made
herein are true under the penalties of perjury.
/s/Laurence A. Lancit
Laurence A. Lancit, President
/a/Marc L. Bailin
Marc L. Bailin, Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF
THE CERTIFICATE OF INCORPORATION
OF
LANCIT MEDIA PRODUCTIONS, LTD.
(Under Section 805 of the Business Corporation Law)
THE UNDERSIGNED, being the duly elected President and Secretary,
respectively, of Lancit Media Productions, Ltd., a New York corporation (the
"Corporation"), DO HEREBY CERTIFY THAT:
1. The name of the Corporation is:
LANCIT MEDIA PRODUCTIONS, LTD.
2. The Certificate of Incorporation of the
Corporation was filed by the Department of State of the State of
New York on July 11, 1979.
3. The amendment of the Certificate of Incorporation
of the Corporation effected hereby is for the purpose of changing
the name of the Corporation.
4. Paragraph "1" of the Certificate of Incorporation
of the Corporation is hereby amended to read in its entirety as
follows:
"(1) The name of the Corporation is:
LANCIT MEDIA ENTERTAINMENT, LTD."
5. The amendment of the Certificate of Incorporation of the
Corporation made hereby was authorized by the unanimous written consent of the
Board of Directors of the Corporation in lieu of a special meeting thereof dated
October 28, 1996, followed by the affirmative vote of the holders of at least a
majority of all the outstanding Common shares entitled to vote thereon at the
Annual Meeting of the Shareholders of the Corporation held on December 18, 1996.
IN WITNESS WHEREOF, this Certificate of Amendment has been subscribed
this 18th day of December, 1996 by the undersigned who affirm that the
statements made herein are true under the penalties of perjury.
/s/ Laurence A. Lancit
Laurence A. Lancit
President
/s/ Marc Bailin
Marc Bailin
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000868796
<NAME> Lancit Media Entertainment, Ltd.
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-Mos
<FISCAL-YEAR-END> Jun-30-1997
<PERIOD-START> Jul-1-1996
<PERIOD-END> Dec-31-1996
<EXCHANGE-RATE> 1.000
<CASH> 6,713,359
<SECURITIES> 0
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0
0
<COMMON> 6,627
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<INCOME-PRETAX> (1,416,313)
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