Document:

Exhibit 10.19

                               SAN HOLDINGS, INC.
                               FOURTH AMENDMENT TO
                       HARRIS LOAN AUTHORIZATION AGREEMENT

Harris Trust and Savings Bank
Chicago, Illinois

Ladies and Gentlemen:

      Reference is hereby made to that certain Harris Loan Authorization
Agreement dated as of May 16, 2003 (the Harris Loan Authorization Agreement, as
the same may be amended from time to time, being referred to herein as the "Loan
Agreement"), between the undersigned, SAN Holdings, Inc., a Colorado corporation
(the "Borrower"), and Harris Trust and Savings Bank (the "Bank"). All
capitalized terms used herein without definition shall have the same meanings
herein as such terms have in the Loan Agreement.

      The Borrower has requested that the Bank increase the available amount of
credit available to the Borrower under the Loan Agreement and make certain
amendments to the Loan Agreement, and the Bank is willing to do so under the
terms and conditions set forth in this agreement (herein, the "Amendment").

SECTION 1.        AMENDMENTS.

      Subject to the satisfaction of all of the conditions precedent set forth
in Section 3 below, the Loan Agreement shall be and hereby is amended as
follows:

      1.1 The Loan Agreement shall be and hereby is amended by deleting the
amount of "$3,300,000" appearing throughout the document and substituting
therefor the amount "$4,800,000."

      1.2 The paragraph entitled "Variable Interest Rate" of the Loan Agreement
shall be deleted and replaced with the following:

            "Variable Interest Rate: The interest rate applicable prior to the
      Maturity Date equals the rate per annum announced by the Bank from time to
      time as its prime commercial rate (the "Prime Rate") plus:

           FROM                    THROUGH                       RATE

The date hereof to             August 16, 2004                         .25%
August 17, 2004 to             November 16, 2004                       .50%
November 17, 2004 to           February 16, 2005                       .75%
February 17, 2005 to           May 16, 2005                             1%
(the "Applicable Margin")."

<PAGE>

      1.3 The paragraph entitled "Maturity Date" of the Loan Agreement shall be
deleted and replaced with the following:

            "Maturity Date: The Loan Account terminates, and Loans are payable
            ON DEMAND (but if no demand, no later than May 16, 2005)."

      1.4 Section 2 (Interest) of the Loan Agreement shall be amended by
deleting the third sentence thereof and replacing it with the following:

            "Interest for each billing period is computed by applying a daily
      periodic rate based on the Bank's Prime Rate plus the Applicable Margin to
      each day's ending Loan balance."

      1.5 The parenthetical immediately following the term "ON DEMAND" set forth
in each of Section 5 (Maturity Date; Payments) and Section 10 (Termination;
Renewal) shall be deleted and replaced with the following:

            "(but if no demand, no later than May 16, 2005)"

      1.6 Exhibit A of the Loan Agreement shall be amended and restated in its
entirety in the form of Exhibit A attached hereto.

SECTION 2.        NEW NOTE.

      In replacement for that certain Note payable to the order of Harris Trust
and Savings Bank dated as of August 14, 2003 in the principal amount of
$3,300,000 (the "Previous Note"), the Borrower shall execute and deliver to the
Bank a new demand note in the amount of $4,800,000, dated as of the date of its
issuance and otherwise in the form of Exhibit A attached hereto (the "New Note")
which shall substitute for the Bank's Previous Note and shall evidence the loans
outstanding to the Bank. All references in the Loan Agreement shall be deemed
references to the New Note.

SECTION 3.        CONDITIONS PRECEDENT.

      3.1 The Borrower and the Bank shall have executed and delivered this
Amendment.

      3.2 The Borrower shall have executed and delivered the New Note to the
Bank.

      3.3 The Bank shall have received copies (executed or certified, as may be
appropriate) of all legal documents or proceedings taken in connection with the
execution and delivery of this Amendment to the extent the Bank or its counsel
may reasonably request.

      3.4 The Borrower shall have paid to the Bank a non-refundable closing fee
in the amount of $12,000.

      3.5 Legal matters incident to the execution and delivery of this Amendment
shall be satisfactory to the Bank and its counsel.

                                       2
<PAGE>

      3.6 Sun Capital Partners II, LP shall have executed and delivered to the
Bank their consent to this Amendment in the form set forth below and an
amendment to the Guaranty.

SECTION 4.        REPRESENTATIONS.

      In order to induce the Bank to execute and deliver this Amendment, the
Borrower hereby represents to the Bank that as of the date hereof the
representations and warranties set forth in the Loan Agreement are and shall be
and remain true and correct and the Borrower is in compliance with the terms and
conditions of the Loan Agreement.

SECTION 5.        MISCELLANEOUS.

      5.1 Except as specifically amended herein, the Loan Agreement shall
continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Loan Agreement, the
Note, or any other instrument or document executed in connection therewith, or
in any certificate, letter or communication issued or made pursuant to or with
respect to the Loan Agreement, any reference in any of such items to the Loan
Agreement being sufficient to refer to the Loan Agreement as amended hereby.

      5.2 This Amendment may be executed in any number of counterparts, and by
the different parties on different counterpart signature pages. all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.

                           [SIGNATURE PAGE TO FOLLOW]

                                       3
<PAGE>

      This Fourth Amendment to Harris Loan Authorization Agreement is entered
into as of this 26th day of November, 2003.

                                         SAN HOLDINGS, INC.

                                         By  /s/ Hugh A. O'Reilly
                                             ----------------------------------
                                             Name Hugh A. O'Reilly
                                                  -----------------------------
                                             Title Sr. VP & CFO
                                                   ----------------------------

         Accepted and agreed to.

                                         HARRIS TRUST AND SAVINGS BANK

                                         By /s/ Kathleen J. Collins
                                            -----------------------------------
                                             Name Kathleen J. Collins
                                                  -----------------------------
                                             Title Vice President
                                                   ----------------------------

                                       4
<PAGE>

                     GUARANTOR'S ACKNOWLEDGEMENT AND CONSENT

      The undersigned, Sun Capital Partners II, LP, heretofore executed and
delivered to the Bank a Guaranty dated May 16, 2003 (as amended, the
"Guaranty"). The undersigned hereby consents to the Amendment to the Loan
Agreement as set forth above and confirms that the Guaranty and all of the
undersigned's obligations thereunder remain in full force and effect. The
undersigned further agrees that the consent of the undersigned to any further
amendments to the Loan Agreement shall not be required as a result of this
consent having been obtained, except to the extent, if any, required by the
Guaranty.

                               SUN CAPITAL PARTNERS II, LP

                               By:   Sun Capital Advisors II, LP
                               Its:  General Partner

                                     By:    Sun Capital Partners, LLC
                                     Its:   General Partner

                                     By:  /s/ David L. Kreilein
                                          -------------------------------------
                                            Name: David L. Kreilein
                                                  -----------------------------
                                            Its:                        VP
                                                  -----------------------------

                                       5
<PAGE>

                                    EXHIBIT A

                                   DEMAND NOTE

$4,800.000                                                    November 26, 2003

      ON DEMAND, for value received, the undersigned, SAN HOLDINGS, INC., a
Colorado corporation, promises to pay to the order of HARRIS TRUST AND SAVINGS
BANK (the "Bank") at its offices at 111 West Monroe Street, Chicago, Illinois,
the principal sum of Four Million Eight Hundred Thousand Dollars ($4,800,000)
or, if less, the amount outstanding under the Harris Loan Authorization
Agreement referred to below together with interest payable at the times and at
the rates and in the manner set forth in the Harris Loan Authorization Agreement
referred to below.

      This Note evidences borrowings by the undersigned under that certain
Harris Loan Authorization Agreement dated as of May 16, 2003, between the
undersigned and the Bank, as the same may be amended from time to time; and this
Note and the holder hereof arc entitled to all the benefits provided for under
the Harris Loan Authorization Agreement, to which reference is hereby made for a
statement thereof. The undersigned hereby waives presentment and notice of
dishonor. The undersigned agrees to pay to the holder hereof all court costs and
other reasonable expenses, legal or otherwise, incurred or paid by such holder
in connection with the collection of this Note. It is agreed that this Note and
the rights and remedies of the holder hereof shall be construed in accordance
with and governed by the laws of the State of Illinois.

      This Note is issued in substitution and replacement for, and evidences
indebtedness previously evidenced by, that certain Note of SAN Holdings, Inc.
dated August 14, 2003, payable to the Bank in the face principal amount of
$3,300,000.

                                         SAN HOLDINGS, INC.

                                         By: /s/ John Jenkins
                                             -----------------------------
                                             Name: John Jenkins
                                                   -----------------------
                                             Title: CEO
                                                    ----------------------EXHIBIT 10.1

                            ASSET PURCHASE AGREEMENT

      ASSET PURCHASE  AGREEMENT,  dated as of March 18, 2005 (this "Agreement"),
by and between AMITY ENTERTAINMENT,  INC., a Delaware corporation ("Purchaser"),
and  MAC  FILMWORKS,  INC.,  a  Delaware  corporation  (the  "Seller").  Certain
capitalized terms used herein are defined in Article XIII hereof.

      WHEREAS,  upon the terms and subject to the  conditions  set forth in this
Agreement,  the Seller  desires to sell to Purchaser,  and Purchaser  desires to
purchase from the Seller,  certain  assets of the Seller,  as more  particularly
described  herein,  in consideration for the payments from the Purchaser and the
assumption of certain liabilities of the Seller each as specified herein.

      NOW, THEREFORE, in consideration of the foregoing and the representations,
warranties,  covenants and agreements contained herein,  intending to be legally
bound hereby, the parties hereto agree as follows:

                                   ARTICLE I.

                           PURCHASE AND SALE OF ASSETS

      Section 1.01. Purchase and Sale of Assets.  Except as set forth in Section
1.02,  upon the terms and subject to the  conditions  set forth  herein,  at the
Closing,  the Seller  shall sell,  convey,  transfer,  assign and deliver to the
Purchaser, and the Purchaser shall purchase, acquire and accept from the Seller,
free and clear of Encumbrances (other than the Permitted  Encumbrances),  all of
the  Seller's  right,  title and  interest in and to the  following  properties,
assets, Contracts,  rights and choses in action, whether tangible or intangible,
whether real, personal or mixed, whether accrued,  contingent or otherwise,  and
wherever  located,  as the same  existed on the Closing Date as provided in this
Agreement (collectively, the "Assets"):

            (a) subject to the terms of the Film Contracts, all right, title and
interest of the Seller,  in and to the  programs and films set forth on Schedule
3.06(a),  including  but not  limited  to, all  literary,  dramatic  and musical
material  therein  contained  (collectively  and individually as to each film or
program, the "Film Library");

            (b)  all of the  Seller's  Film  Assets  associated  with  the  Film
Library,  including all  inventories  of films,  videos,  DVDs and other similar
products, availability schedules, historical information, and film elements;

            (c) all of the  Seller's  accounts  receivable  (on and off  balance
sheet), notes, prepaid items and expenses,  deferred charges,  rights of offset,
claims  for  refund,  and other  receivables  or right to  payment of any nature
whatsoever relating to the Film Library (collectively,  "Receivables")  existing
on the Closing Date, and all such items arising thereafter,  a true, correct and
complete list of which, as they existed on the Closing Date, is set forth hereto
as Schedule 3.04;

<PAGE>

            (d) cash and  cash  equivalents  of  Seller  received  from the Film
Library on and after the Closing Date;

            (e) all Film Asset Acquisition  Agreements,  Film Asset Exploitation
Agreements, all Contracts for the distribution by Seller of products or services
relating to the Film Library, and all other Contracts entered into by the Seller
relating to the Film Library,  including  those  specified on Schedule 3.07 (the
"Assumed Contracts");

            (f) all of the Seller's (i) trademarks and service marks relating to
the  Film  Library,  and  any  registrations,   registration   certificates  and
applications for registration  therefor,  and the goodwill associated  therewith
(the  "Trademarks"),   (ii)  trade  names,  assumed  and  fictitious  names  and
registered user names relating to the Film Library,  and  registrations  and any
applications for registration  therefor,  and the goodwill associated  therewith
and related internet domain names (the "Trade Names"),  and (iii) copyrights and
registrations relating to the Film Library and any applications for registration
therefor (the "Copyrights"),  including,  without limitation,  those items which
are specified on Schedule 3.06(c)(i);

            (g) all of the Seller's available books, records, files, manuals and
other similar materials, including,  advertising materials, marketing materials,
brochures,  business and marketing plans and proposals,  production  data, sales
and promotional materials and records,  purchasing materials and records,  files
for past,  existing and contemplated  projects,  media materials,  financial and
fiscal records (copies),  sales order files, customer lists and customer records
in any form (and all  software  related  to any such  customer  records,  to the
extent  transferable),  whether of past or present customers or potential future
customers,  related  to or  arising  from the Film  Library,  advertiser  lists,
receipts and computer records relating to the Film Library,  standard  operating
procedures, correspondence,  customer relations information, and any other trade
secrets,  confidential or proprietary information pertaining to the Film Library
(the "Business Records");

            (h) all of Seller's claims,  choses in action,  causes of action and
judgments  relating  to the Film  Library,  including  those  listed on Schedule
1.01(h);

            (i) all  certifications,  franchises,  approvals,  permits licenses,
orders,  registrations,  certificates,  variances and other  similar  permits or
rights  obtained  from  any   Governmental   Entity  or  professional  or  trade
organization relating to the Film Library and all pending applications therefor;

            (j) all third party warranties and guarantees with respect to any of
the Assets; and

            (k) all rights to receive insurance proceeds relating to the damage,
destruction  or  impairment of any of the Assets on or subsequent to the Closing
Date.

      Section 1.02.  Excluded  Assets.  Notwithstanding  anything else contained
herein, the Seller shall not sell,  transfer,  convey or assign to the Purchaser
the following (the "Excluded Assets"):

                                       2
<PAGE>

            (a) all cash and cash  equivalents  of the Seller  arising  from the
Assets received prior to the Closing Date;

            (b) all  original  versions  of  accounting,  financial  and  fiscal
records; and

            (c) all rights to receive insurance proceeds relating to the damage,
destruction or impairment of any of the Assets prior to the Closing Date.

      Section 1.03.  Assumed  Liabilities.  Subject to the terms and  conditions
contained in this Agreement, at the Closing, the Purchaser agrees to assume, pay
and perform when due the following  liabilities and obligations of the Seller as
of the Closing Date and for all periods  thereafter all as further  described on
Schedule 1.03 (the "Assumed Liabilities"):

            (a) all  Residuals,  Participations,  Guild Payments and other third
party  obligations  owed on or after the Closing  Date that arise from  receipts
relating to the Film Assets received on or after the Closing Date (but excluding
any  penalties  for, or interest on,  payments due prior to the Closing Date and
not paid on a timely basis);

            (b)  all  obligations  arising  or  coming  due  under  the  Assumed
Contracts in accordance  with their terms with respect to acts or services to be
performed under such Assumed  Contracts  after the Closing Date,  except for any
obligation  (a) that  relates to any breach or default (or an event which might,
with the passing of time or the giving of notice, or both, constitute a default)
under any such  Assumed  Contract  arising  out of or  relating to periods on or
prior to the  Closing  Date,  (b) for which the Seller  owes any  amounts to its
Affiliates  (except as disclosed on Schedule  3.08),  or (c) that relates to any
indemnity, defense or hold harmless provision or agreement for occurrences prior
to the Closing Date,  provided that if any such obligation relates to actions or
the failure to act on the part of the Seller,  such obligation  shall remain the
Seller's responsibility and shall not become an Assumed Liability; and

            (c)  the  costs  and  expenses  of  maintaining  or  preserving  the
intellectual property included in the Film Assets.

      Section 1.04. Excluded  Liabilities.  Except for the Assumed  Liabilities,
Purchaser  shall not assume or be bound by any  Liabilities of the Seller of any
kind or nature,  known,  unknown,  accrued,  absolute,  contingent,  recorded or
unrecorded  or  otherwise,  whether  now  existing  or  hereafter  arising  (the
"Excluded  Liabilities").   The  Excluded  Liabilities  shall  include,  without
limitation, the following: (i) all Residuals,  Participations and Guild Payments
arising from receipts relating to the Film Library received prior to the Closing
Date  (including any penalties for, or interest on, payments due and not paid on
a timely basis prior to the Closing Date); (ii) any Liability of the Seller with
respect to unpaid  laboratory  costs, tape duplication costs or unpaid advances,
guaranties  or deferments  (except as disclosed on Schedule  1.03) in connection
with any Film Contract; (iii) any Liability of the Seller with respect to unpaid
synchronization  or music  license  fees used in the Film  Library  prior to the
Closing Date; (iv) any Liability of the Seller with respect to unpaid production
costs  arising  prior to the Closing Date and (v) any  Liability  related to the
Seller Obligations. All responsibility for the Excluded Liabilities shall remain
with the Seller.

                                       3
<PAGE>

      Section 1.05.  Purchase Price.  The purchase price for the Assets shall be
an amount equal to either (i) one million eight hundred fifty  thousand  dollars
($1,850,000)  if Schedule  3.06(a) is updated by Seller  between the date hereof
and the Closing Date to include  additional titles having a fair market value of
at least $100,000 as determined by Purchaser in its sole and absolute discretion
and  that are  otherwise  acceptable  to  Purchaser  in its  sole  and  absolute
discretion,   or  (ii)  one  million  seven  hundred  fifty   thousand   dollars
($1,750,000)  if  Schedule  3.06(a) is not  updated by Seller  between  the date
hereof and the Closing Date in accordance with Section 1.05(i) above.

      Section  1.06.  Payment of  Purchase  Price.  Subject  to the  conditions,
representations  and  warranties  and  covenants  hereof,  at  the  Closing  the
Purchaser  shall pay the Purchase  Price as follows,  each by federal funds wire
transfers of immediately  available  funds to accounts  designated in writing by
each of the payees set forth below.

            (a) to Seller, the Purchase Price as calculated in Section 1.05 less
(i) the principal amount of the Seller Note (the "Closing Cash  Consideration"),
and (ii) the amounts paid to the obligors under the Seller Obligations  pursuant
to Section 1.06(b) below, to the Seller;

            (b) to each obligor under a Seller Obligation,  an amount sufficient
to  satisfy  in full  Seller's  obligations  to  such  obligor  pursuant  to the
Settlement Agreement; and

            (c) to Seller,  a  promissory  note in a form to be mutually  agreed
upon by Seller and  Purchaser  (the "Seller  Note") in the amount of two hundred
fifty thousand dollars ($250,000) that will be secured by the Assets and due and
payable  on the date  that is twenty  four (24)  months  from the  Closing  Date
(subject to the Right of Setoff in Section 9.05).

      Section 1.07.  Transfer Taxes.  Seller shall be responsible for, and shall
pay on or prior to their due date,  all  municipal,  county,  state and  federal
sales,  use and transfer  taxes  incurred and the related  costs of preparing or
documenting the same, if any, in connection with the  Transactions  contemplated
by the Agreement.

      Section 1.08. Allocation of Purchase Price. The consideration provided for
herein has been  allocated  among the Assets in the manner  required by Treasury
Regulation  ss.1.1060-1  as set  forth in more  detail  on  Schedule  1.08  (the
"Allocation").  The parties hereto agree that,  except as otherwise  required by
law (i) the Allocation  shall be binding on the parties for all federal,  state,
local and  foreign  tax  purposes  and (ii) the  parties  shall  file with their
respective federal income tax returns consistent  Internal Revenue Service Forms
8594 - Asset Acquisition  Statements under Section 1060,  including any required
Internal  Revenue  Service  forms,  schedules or amendments  thereto which shall
reflect the allocation set forth in the Allocation.

                                   ARTICLE II.

                                   THE CLOSING

      Section  2.01.  Closing  Date.  Unless  this  Agreement  shall  have  been
terminated and the Transactions shall have been abandoned pursuant to Article X,
and  subject  to the  satisfaction  or  waiver  of the  conditions  set forth in
Articles  VII and VIII,  the closing of the  Transactions  contemplated  by this
Agreement (the  "Closing")  shall take place at the offices of Dechert,  LLP, 30
Rockefeller  Plaza,  New York,  New York 10112 at 10:00 a.m. on April 30,  2005,
provided that the satisfaction or waiver of each condition set forth in Articles
VII and VIII has occurred by such date,  or such other  place,  date and time as
the parties shall  mutually agree (such date and time of the Closing is referred
to herein as the "Closing Date").

                                       4
<PAGE>

      Section 2.02. Deliveries at Closing.

            (a) At the Closing, the Purchaser shall deliver the following to the
Seller:

                  (i) the Closing Cash Consideration and the Seller Note;

                  (ii)  a  certificate   of  Purchaser,   duly  executed  by  an
            appropriate  officer  thereof,  certifying  to  compliance  with the
            covenants  set  forth  in  Article  VI,  and  satisfaction  (or,  as
            specified, waiver) of the conditions set forth in Article VIII;

                  (iii) true,  correct and complete  copies of resolutions  duly
            and  validly  adopted  by the Board of  Directors  of the  Purchaser
            evidencing the  authorization  of the execution and delivery of this
            Agreement,  the other Transaction  Documents to which Purchaser is a
            party and the consummation of the Transactions  contemplated  hereby
            and  thereby,  and with respect to the  resolutions  of the Board of
            Directors,  accompanied  by a  certificate  of the  Secretary of the
            Purchaser,  dated as of the Closing Date, stating that no amendments
            have been made  thereto  from the date  thereof  through the Closing
            Date;

                  (iv) a duly executed  Assignment,  Bill of Sale and Assumption
            Agreement  in a form  to be  mutually  agreed  upon  by  Seller  and
            Purchaser;

                  (v) confirmation that the Seller Obligations have been paid in
            full in accordance with the Settlement Agreement; and

                  (vi) a certificate from the Secretary of State of the State of
            Delaware as to the good standing of Purchaser  dated within ten (10)
            days of the Closing.

            (b) At the Closing, the Seller shall deliver to the Purchaser:

                  (i) a certificate  from the Secretary of State of the State of
            Delaware as to the good standing of the Seller dated within ten (10)
            days of the Closing;

                  (ii) an Assignment, Bill of Sale and Assumption Agreement in a
            form to be  mutually  agreed  upon by  Seller  and  Purchaser,  duly
            executed by Seller,  and all such other  instruments  of assignment,
            transfer  or  conveyance  as shall,  in the  reasonable  opinion  of
            Purchaser and its counsel, be necessary to vest in Purchaser,  good,
            valid and marketable title to the Assets, subject to no Encumbrances
            (other than Permitted  Encumbrances)  and to put Purchaser in actual
            possession or control of the Assets;

                                       5
<PAGE>

                  (iii)  one or  more  Copyright  Assignments  in a  form  to be
            mutually  agreed  upon by Seller and  Purchaser,  duly  executed  by
            Seller, assigning all of the Copyrights to Purchaser;

                  (iv)  one  or  more  Trademark  Assignments  in a  form  to be
            mutually  agreed  upon by Seller and  Purchaser,  duly  executed  by
            Seller, assigning all of the Trademarks to Purchaser;

                  (v) one or more Domain Name Transfers in a form to be mutually
            agreed  upon by Seller  and  Purchaser,  duly  executed  by  Seller,
            assigning  all of the  internet  domain  names  relating to the Film
            Library to Purchaser;

                  (vi)  a  certificate  of  the  Seller,  duly  executed  by  an
            appropriate  officer  thereof,  certifying  to  compliance  with the
            covenants  set forth in Article V and Article  VI, and  satisfaction
            (or, as specified,  waiver) of the  conditions  set forth in Article
            VII;

                  (vii) true, correct and complete copies of (1) the certificate
            of incorporation, as amended to date, of the Seller, certified as of
            a recent date by the  Secretary  of State of the State of  Delaware,
            (2) the  by-laws of the  Seller,  (3)  resolutions  duly and validly
            adopted  by the Board of  Directors  of the  Seller  evidencing  the
            authorization  of the execution and delivery of this Agreement,  the
            other  Transaction  Documents  to which  Seller  is a party  and the
            consummation of the  Transactions  contemplated  hereby and thereby,
            and with  respect  to the  resolutions  of the  Board of  Directors,
            accompanied by a certificate  of the Secretary of the Seller,  dated
            as of the Closing Date,  stating that no  amendments  have been made
            thereto from the date thereof through the Closing Date;

                  (viii) pursuant to Section 3.04,  updates of Schedule 1.03 and
            Schedule 3.04;

                  (ix) all Consents, waivers and estoppels from third parties as
            required  to  consummate  the  Transactions   contemplated  by  this
            Agreement, all as set forth on Schedule 3.02(c);

                  (x)  Lien  searches,   a  clearance   certificate  or  similar
            document(s)  that may be  required  by any  state,  local or foreign
            Governmental  Entity in order to relieve Purchaser of any obligation
            to  withhold  any  portion  of the  Purchase  Price  and such  other
            instruments  showing  that  there  were  no  financing   statements,
            judgments,  Taxes or other Liens outstanding against the Seller with
            respect any of the Assets;

                  (xi)  to  the  extent   applicable,   payoff  letters,   UCC-3
            termination  statements  and  other  documentation  relating  to the
            release of all security interests as necessary,  all as set forth on
            Schedule 3.02(c);

                  (xii) a Laboratory  Transfer Letter,  in a form to be mutually
            agreed upon by Seller and Purchaser, executed by the Seller;

                                       6
<PAGE>

                  (xiii) the Business Records;

                  (xiv) an opinion,  dated the Closing  Date,  of counsel to the
            Seller,  in  a  form  and  substance   reasonably   satisfactory  to
            Purchaser; and

                  (xv) a duly executed  Settlement  Agreement  (the  "Settlement
            Agreement")  among the  Seller  and each  obligor  under the  Seller
            Obligations  whereby each such obligor  agrees that upon the payment
            of certain  amounts to such obligor the Seller  Obligations  will be
            satisfied in full.

                                  ARTICLE III.

                  REPRESENTATIONS AND WARRANTIES OF THE SELLER

      The  Seller  represents  and  warrants  to  and  for  the  benefit  of the
Purchaser, as of the date hereof and as of the Closing Date, as follows:

      Section 3.01. Organization and Qualification.  The Seller is a corporation
duly  organized,  validly  existing and in good  standing  under the laws of the
State of Delaware.  The Seller has all  corporate or other power and  authority,
and is duly authorized by all necessary regulatory approvals and orders, to own,
lease and operate the Assets and  properties  and to carry on the Business as it
is now  being  conducted,  and is  duly  qualified  and in good  standing  to do
business  in each  jurisdiction  in which  the  nature  of the  Business  or the
ownership  or  leasing of the Assets  and  properties  makes such  qualification
necessary.

      Section 3.02. Authority.

            (a) Authority.

                  (i) The Board of  Directors of the Seller has taken all action
            to  authorize  and  approve  the   Transaction   Documents  and  the
            Transactions.  The Seller has all  requisite  power and authority to
            enter into the  Transaction  Documents to which it is a party and to
            consummate the Transactions contemplated hereby and thereby.

                  (ii) The execution,  delivery and performance by the Seller of
            each   Transaction   Document  to  which  it  is  a  party  and  the
            consummation by the Seller of the Transactions  contemplated  hereby
            and thereby have been duly authorized by all corporate action on the
            part of the Seller, and no other corporate proceeding on the part of
            the Seller is necessary to authorize each Transaction Document.

                  (iii) Each Transaction Document to which the Seller is a party
            has been duly and validly  executed and delivered by the Seller and,
            assuming the due authorization, execution and delivery hereof by the
            other parties hereto,  constitutes the valid and binding  obligation
            of  the  Seller,  enforceable  against  it in  accordance  with  its
            respective terms.

                                       7
<PAGE>

            (b)  Non-Contravention.  Neither the  execution  and delivery by the
Seller of any Transaction  Document to which it is a party nor the  consummation
or performance by the Seller of any of the Transactions  contemplated hereby and
thereby will contravene,  conflict with or result in any violation by the Seller
under any provisions of or result in acceleration,  termination, cancellation or
modification of, or constitute a default under:

                  (i) the articles of incorporation, bylaws or similar governing
            documents of the Seller;

                  (ii) any Requirements of Law;

                  (iii) any order of any Governmental Entity; or

                  (iv) any  note,  bond,  mortgage,  indenture,  deed of  trust,
            license,  franchise,  permit,  concession,  Contract, lease or other
            instrument,  obligation  or  agreement  of any kind  relating to the
            Assets to which the Seller is now a party or by which the Assets may
            be bound or affected, except for Permitted Encumbrances.

Neither the execution nor the delivery by the Seller of any Transaction Document
will  result in the  creation  or  imposition  of any  Encumbrance  (other  than
Permitted Encumbrances) of any nature whatsoever upon the Assets.

            (c)  Approvals.   Except  as  set  forth  on  Schedule  3.02(c),  no
declaration,  filing or  registration  with,  or notice to or  Consent  of,  any
Governmental  Entity or any other  Person is  necessary  for the  execution  and
delivery by the Seller of any Transaction Document to which it is a party or the
consummation by the Seller of the Transactions contemplated hereby and thereby.

            (d) Compliance.

                  (i) With  regards to the  Assets,  neither  the Seller nor its
            employees  or  agents  is,  or has  been  in the  last 3  years,  in
            violation  in any  material  respect of, or has been given notice or
            been  charged  with any  material  violation  of,  any  law,  order,
            regulation, ordinance or judgment of any Governmental Entity.

                  (ii) The Seller has all permits,  licenses and franchises from
            Governmental  Entities  necessary  for  the  ownership,   marketing,
            distribution,  licensing  and  exploitation  of the Assets and is in
            compliance  in all  material  respects  with the terms  thereof.  No
            violations  have been  reported  in  writing to Seller in respect of
            such permits,  licenses and franchises.  Schedule  3.02(d)(ii) lists
            each permit,  license and  franchise  of the Seller  relating to the
            Assets.  A true and  complete  copy of each  such  material  permit,
            license and franchise of the Seller  relating to the Assets has been
            provided to  Purchaser  and as of the date of the Closing  each such
            permit,  license and franchise shall be assigned to Purchaser and be
            in full force and effect upon such assignment.

                                       8
<PAGE>

      Section 3.03. Title to Properties;  Liens; Condition of Assets. The Seller
has good, valid and marketable title to all of the Assets, free and clear of any
Encumbrances,  other than (i) Liens on  properties  and assets  securing  Taxes,
assessments, governmental charges or levies, in each case, which are not yet due
and payable,  (ii) Liens held by licensees under Assumed Contracts,  SAG, WGA or
the DGA which arose in the ordinary course of business  consistent with industry
standards  and which did not arise from any action or  inaction  of Seller,  and
(iii) Liens  disclosed on Schedule 3.03 ((i) through  (iii),  collectively,  the
Permitted Encumbrances). At the Closing, the Seller will convey to the Purchaser
good title to the  Assets,  free and clear of any  Encumbrances,  other than the
Permitted Encumbrances (except for Permitted Encumbrances relating to the Seller
Obligations). All of the Physical Properties are in good operating condition and
repair, subject to normal wear and tear, none of such Physical Properties are in
need of maintenance or repairs except for ordinary, routine maintenance and such
Physical  Properties are suitable for and operating  according to their intended
use.

      Section 3.04. Receivables and Assumed Liabilities.

            (a) Schedule 3.04 sets forth a true,  correct and complete aged list
of the Receivables of the Seller as of the date hereof.  At Closing,  the Seller
shall deliver a true,  correct and complete  updated list of such Receivables as
of the Closing  Date.  Except as set forth on  Schedule  3.04,  all  Receivables
outstanding as of the date hereof, and as of the Closing Date (i) are bona fide,
or will have been bona fide,  and arose,  or will have arisen,  from the sale of
inventory  or  services  to Persons  not  affiliated  with the Seller and in the
ordinary course of business consistent with past practice and (ii) are supported
by a valid and enforceable Assumed Contract.

            (b) Schedule  1.03 sets forth a true,  correct and complete  list of
the Assumed  Liabilities as such items exist as of the date hereof.  At Closing,
the Seller  shall  deliver a true,  correct and  complete  updated  list of such
Assumed  Liabilities  as of the Closing  Date.  Each Assumed  Liability  (i) has
arisen, or will have arisen,  from the operation of the Business in the ordinary
course of business  consistent with past practice and (ii) is properly,  or will
be, properly and accurately reflected in the Business Records of the Seller.

      Section 3.05. Litigation; Investigations. Except as specifically set forth
on Schedule 3.05, there are: (i) no claims,  actions,  suits,  investigations or
proceedings  pending or, to the  knowledge  of the Seller,  threatened  against,
relating to, or affecting  the Seller,  the Assets,  or to the  knowledge of the
Seller, any employee,  officer or director of the Seller relating to the Assets,
and (ii) no orders of any Governmental Entity or arbitrator  outstanding against
either of the Seller (in  connection  with the  Assets),  the Assets,  or to the
knowledge  of the  Seller,  any  employee,  officer  or  director  of the Seller
relating to the Assets, or that could prevent or enjoin or delay in any respect,
consummation of the Transactions contemplated hereby.

      Section 3.06. Matters Regarding the Film Library.

            (a) Schedule 3.06(a) sets forth, on a title-by-title  basis, a true,
correct and complete  list of the principal  films and programs that  constitute
the Film Library.

                                       9
<PAGE>

            (b) Except with respect to the Permitted  Encumbrances and the terms
of the Film Contracts, the Seller owns good and marketable title to, holds fully
valid,  enforceable and exclusive licenses of or is otherwise duly authorized to
use  substantially all rights under all copyrights,  trademarks,  service marks,
trade secrets and other  Intellectual  Property  used or otherwise  exploited by
Seller in connection with the Assets,  including,  without limitation,  the Film
Assets  and the Film  Library,  and the  rights to use,  duplicate,  distribute,
merchandise,  create derivative works based upon, publicly perform, and publicly
display the Film Assets.

            (c) Schedule 3.06(c)(i) sets forth a true, correct and complete list
of all of  Seller's  copyright  registrations,  registration  numbers and serial
numbers  by  the  issuing  authority  related  to  the  Film  Library.  Schedule
3.06(c)(ii)  sets forth a true,  correct  and  complete  list of all of Seller's
trademarks,  service  marks,  trade  names,  domain  names  and  logos,  and all
registrations,  registration numbers and serial numbers by the issuing authority
thereof,  included in the Film Library. Schedule 3.06(c)(iii) sets forth a true,
correct and complete list (the "Physical Properties  Schedule") of each location
at which the Physical Properties are held or stored and a general description of
the nature or type of Physical  Properties  held or stored  thereat  and, at the
Closing,  Purchaser shall have exclusive ownership of such Physical  Properties,
subject to any Permitted Encumbrances.

            (d) The ownership,  use or  exploitation  of the Film Library by any
means in connection  with the  operations of the Seller or its  Affiliates  with
respect to the Assets  prior to the  Closing  does not and will not  infringe or
misappropriate the rights of any other Person,  including,  without  limitation,
any rights  relating to defamation,  contract,  trademark,  unfair  competition,
copyright,  trade secret, privacy or publicity.  Except as set forth on Schedule
3.06(d),  neither the Seller nor any  Affiliate  of the Seller has  received any
notice of infringement or  misappropriation or other notice of claim relating to
the Film Library including, without limitation,  oppositions filed in respect to
the Seller's  trademark  applications,  if any. Further,  no presently  existing
assignment,  license or other  transfer to the Seller of any portion of the Film
Library or of any rights  thereunder  is now or, to the knowledge of the Seller,
will in the future become  subject to  rescission,  cancellation  or termination
(except as may occur by  operation  of statute  pursuant  to Section  304 of the
Copyright Act of 1976, as amended,  or any equivalent  foreign statutes to which
the Film Assets may be subject,  or, with  respect to any Assumed  Contract,  as
expressly set forth by its terms).

            (e)  All  advances,   guarantees,   Guild  Payments,  Residuals  and
Participations,  laboratory  payments,  open  purchase  orders,  costs  and fees
charged by agents and  sub-agents,  and other amounts or obligations  owed, due,
invoiced or payable  prior to or on the Closing  Date by the Seller,  any of its
Affiliates  or any of its  predecessors-in-interest  pursuant  to or  under  the
Assumed Contracts or otherwise in respect of the Film Library have been paid, or
at the Closing will be retained by Seller.

            (f) Except pursuant to the Assumed  Contracts,  there are no Persons
that  have  (or  will  have)  any  rights  to  participate  in the  development,
production, distribution or financing of any portion of the Film Library.

            (g) None of the licensors under any Film Asset Acquisition Agreement
to which the  Seller is a party has  exercised  any right to buy back any rights
granted to Seller in the Film  Library nor have any such rights  reverted to any
licensor  nor has any such  licensor  purported to terminate or rescind any such
rights.

                                       10
<PAGE>

            (h) All of the artwork, packaging, publicity,  promotional materials
and  advertising  prepared  by  Seller  relating  to the Film  Library  has been
prepared in accordance  with and is in compliance in all material  respects with
all of the  requirements  of the applicable  Film Contracts and  requirements of
applicable  laws which are  customarily  applicable to  transactions of the type
contemplated herein.

            (i) The transfer of the Assets  pursuant to this Agreement will vest
in  Purchaser  all  rights  with  respect  to  musical  compositions  and  sound
recordings  licensed  from third  parties by Seller and  contained in the Assets
necessary for the lawful  distribution,  exhibition and exploitation of the Film
Library without infringing or violating any laws or rights of third parties; and
the performance  rights of all non-dramatic  music contained in the Film Library
(whether in connection with musical  compositions or sound  recordings) are: (i)
controlled by a performing rights  organization such as the American Society for
Composers Authors and Publishers, Broadcast Music Inc., SESAC, Inc., PRS, and/or
SOCAN,  (ii) available for license from the party(ies)  controlling such rights,
(iii) in the public  domain,  or (iv)  controlled by Seller  directly or through
license(s), and if so, then such rights are granted herewith.

            (j) The  Seller  has  not  sold,  leased,  pledged,  disposed  of or
otherwise  transferred or encumbered in any way any of the Film Assets since the
date the Seller acquired such Film Assets.

      Section 3.07. Contracts.  Schedule 3.07 sets forth a complete and accurate
list of all Assumed  Contracts.  Each of the Assumed  Contracts is in full force
and effect and  enforceable  in  accordance  with its terms.  The Seller has not
received  notice of  cancellation  of or intent to  cancel,  or notice to make a
modification or intent to make a modification in, any of the Assumed  Contracts.
The  consummation  of the  Transactions  hereunder  will not result in the early
termination of any of the Assumed Contracts or have a material adverse effect on
the  relationships  between the Purchaser (as the new owner of the Film Library)
and the customers who have licensed or otherwise  acquired rights in portions of
the Film Library.  There exists no event of default or occurrence,  condition or
act on the part of the Seller or, to the best  knowledge  of the Seller,  on the
part of the other parties to such Assumed  Contracts which  constitutes or would
constitute  (with notice or lapse of time or both) a breach  under,  or cause or
permit acceleration of, any obligation of the Seller. Except as specifically set
forth on  Schedule  3.02(c) no Consent of any other  party to any of the Assumed
Contracts is required in connection with the execution, delivery and performance
of this  Agreement  by the Seller,  which  Consents  shall be obtained  prior to
Closing.  The Seller has  delivered  or made  available  to  Purchaser  true and
complete copies of each Assumed Contract listed on Schedule 3.07.

      Section  3.08.  Transactions  with  Affiliates.  Except  as set  forth  on
Schedule 3.08, none of the officers, directors, employees or stockholders of the
Seller (a) is a party to any Assumed Contract with the Seller,  (b) has asserted
or  threatened  to assert any claim  against the  Seller,  (c) is engaged in any
transaction  with  the  Seller  relating  to the  Assets,  or (d) to the  actual
knowledge of the Seller,  has any direct or indirect  financial  interest in any
competitor,  supplier,  customer,  or distributor of the Seller as it relates to
the Assets.

                                       11
<PAGE>

      Section 3.09. Taxes.

            (a) All material Tax Returns  required by applicable law to be filed
by or on  behalf  of the  Seller  prior to or as of the  Closing  Date have been
timely  filed or will be timely filed as of the Closing  Date,  and all such Tax
Returns are true, complete and correct in all material respects.

            (b) All material Taxes that are due or claimed to be due from Seller
on or prior to the Closing  Date have been paid or will have been paid as of the
Closing Date, other than those (A) currently payable without penalty or interest
or (B) being  contested  in good  faith and by  appropriate  proceedings,  which
proceedings are described in Schedule 3.09.

      Section  3.10.  Bulk Sales.  The bulk sales laws of the  jurisdictions  in
which the Assets are located are not applicable to the Transactions contemplated
hereby.

      Section 3.11. Disclosure. No representation, warranty or statement made by
the Seller in (i) this Agreement or (ii) the Schedules attached hereto, contains
or will contain any untrue  statement of a material  fact, or omits or will omit
to state a material fact required to be stated herein or therein or necessary to
make the statements  contained herein or therein,  in light of the circumstances
under which they were made, not misleading.

      Section 3.12. Insurance.  Seller does not currently have and has never had
any insurance policies related to the Assets.

      Section  3.13.   Permits.   No  permits,   license  or  franchise  from  a
Governmental   Entity  is   necessary   for   Seller's   ownership,   marketing,
distribution, or exploitation of the Assets.

                                   ARTICLE IV.

                 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

      Purchaser represents and warrants to and for the benefit of the Seller, as
of the date hereof and as of the Closing Date, as follows:

      Section 4.01.  Organization and Qualification.  Purchaser is a corporation
duly  organized,  validly  existing and in good  standing  under the laws of the
State of Delaware.

      Section 4.02. Authority.

            (a) Authority.

                  (i) The  Board of  Directors  of the  Purchaser  has taken all
            action to authorize  and approve the  Transaction  Documents and the
            Transactions. The Purchaser has all requisite power and authority to
            enter into the  Transaction  Documents to which it is a party and to
            consummate the Transactions  contemplated hereby and thereby. At the
            Closing,  Purchaser will have adequate  financial  resources to fund
            the transactions contemplated by this Agreement.

                                       12
<PAGE>

                  (ii) The execution,  delivery and performance by the Purchaser
            of  each  Transaction  Document  to  which  it is a  party  and  the
            consummation  by  the  Purchaser  of the  Transactions  contemplated
            hereby and thereby have been duly authorized by all corporate action
            on the part of the  Purchaser and no other  corporate  proceeding on
            the part of the Purchaser is necessary to authorize each Transaction
            Document.

                  (iii) Each Transaction  Document to which Purchaser is a party
            has been duly and validly  executed and delivered by Purchaser  and,
            assuming the due authorization, execution and delivery hereof by the
            other parties hereto,  constitutes the valid and binding  obligation
            of  Purchaser,   enforceable  against  it  in  accordance  with  its
            respective terms.

      (b) Non-Contravention.  Neither the execution and delivery by Purchaser of
any  Transaction  Document  to  which  it is a  party  nor the  consummation  or
performance  by Purchaser  of any of the  Transactions  contemplated  hereby and
thereby will  contravene,  conflict with or result in any violation by Purchaser
under any provisions of or result in acceleration,  termination, cancellation or
modification of, or constitute a default under:

                  (i) the articles of incorporation, bylaws or similar governing
            documents of Purchaser;

                  (ii) any Requirements of Law;

                  (iii) any order of any Governmental Entity; or

                  (iv) any  note,  bond,  mortgage,  indenture,  deed of  trust,
            license,  franchise,  permit,  concession,  Contract, lease or other
            instrument,  obligation or agreement of any kind to which  Purchaser
            is now a party.

      (c) Approvals.  No declaration,  filing or registration with, or notice to
or Consent of, any Governmental  Entity or any other Person is necessary for the
execution and delivery by Purchaser of any Transaction Document to which it is a
party or the consummation by Purchaser of the Transactions.

      Section 4.03. Disclosure. No representation, warranty or statement made by
Purchaser in (i) this Agreement or (ii) the Schedules attached hereto,  contains
or will contain any untrue  statement of a material  fact, or omits or will omit
to state a material fact required to be stated herein or therein or necessary to
make the statements  contained herein or therein,  in light of the circumstances
under which they were made, not misleading.

                                       13
<PAGE>

                                   ARTICLE V.

                         PRE-CLOSING COVENANTS OF SELLER

      Except with the prior written  consent of the Purchaser,  the Seller shall
comply with the  provisions of this Article V after the date hereof and prior to
the Closing Date or earlier termination of this Agreement.

      Section 5.01.  Ordinary  Course of Business.  The Seller shall conduct its
business as it relates to the Assets in the usual,  regular and ordinary  course
in substantially the same manner as heretofore conducted and use best efforts to
preserve  the  Assets,   preserve   relationships  with  customers,   suppliers,
franchisors,  distributors and others having business  dealings with it and keep
available the services of its present  officers and  employees,  in each case in
the ordinary course of business consistent with past practice.  The Seller shall
not take any action  with the purpose of causing  any of the  conditions  to the
Purchaser's  obligations  set forth in Article  VII hereof to not be  satisfied.
Except as expressly contemplated by this Agreement, the Seller shall not without
the prior written consent of the Purchaser:

            (a) enter into any commitment or transaction  relating to the Assets
not in the ordinary course of business;

            (b) enter  into,  modify,  amend or waive  any terms of any  Assumed
Contract;

            (c) take any action or engage in any  transaction  which would cause
any  representation  or warranty of the Seller  hereunder to be untrue as of the
Closing Date;

            (d) accelerate the receipt of payment with respect to receivables or
slow down the payment of payables relating to the Assets;

            (e) enter into any agreement with any of its Affiliates  relating to
the Assets; or

            (f) agree in writing to take any of the actions  described  above in
this Section 5.01.

      Section 5.02. Certain Actions. The Seller shall not sell, lease, transfer,
license,  pledge,  encumber  or  otherwise  dispose  of any  Assets or incur any
Liabilities  or  obligations  of any nature  whatsoever  relating  to the Assets
(whether absolute, accrued, contingent or otherwise and whether due or to become
due) without the prior written consent of the Purchaser.

      Section 5.03. Intentionally Omitted.

      Section 5.04. Intentionally Omitted.

      Section 5.05. Actions.  The Seller shall not institute,  settle or dismiss
any action, claim, demand, lawsuit,  proceeding,  arbitration or grievance by or
before any Governmental Entity threatened against,  relating to or involving the
Assets, without the prior written consent of the Purchaser.

      Section 5.06.  Maintenance  of Assets.  The Seller shall  maintain all the
Assets in good repair and condition,  except to the extent of wear or use in the
ordinary  course of business and consistent with past practice or damage by fire
or other unavoidable casualty.

                                       14
<PAGE>

      Section 5.07. Access and Investigation. The Seller and its representatives
shall  afford  to   representatives   of   Purchaser,   including  its  counsel,
accountants,  consultants  and  lenders,  with full and complete  access  during
normal business hours to all of the properties,  books,  Contracts,  records and
assets of the Seller to enable the Purchaser to perform a due  diligence  review
of the Film Library. Such due diligence review shall include, but not be limited
to the  following  (i)  obtaining  a complete  and  accurate  list of all films,
television  episodes  and other titles and media  included in the Film  Library,
(ii)  obtaining a complete  and  accurate  list of all  distribution  agreements
relating to any and all items in the Film Library,  (iii) confirming that Seller
possesses Physical Properties for each item in the Film Library,  (iv) obtaining
advice from qualified  third-party advisors as to the potential commercial value
of the Film Library and the time and resources  likely to be required to realize
such value,  (v) obtaining  advice from qualified third party advisors as to the
physical  condition of the Film Library,  and as to the steps and cost necessary
to convert the Film Assets into digital or other form necessary to commercialize
such items,  (vi)  obtaining  advice from  counsel and other  advisers as to the
validity and  enforceability of Seller's title to each item in the Film Library,
and as to the current validity and  enforceability  of copyright  protection for
each such  item,  and (vii)  conducting  such  other  legal and  accounting  due
diligence as Purchaser deems appropriate in its sole discretion. Any information
obtained  pursuant to this Section 5.07 shall be held in strict  confidence  and
shall be used solely in connection with the Transactions  contemplated hereunder
and shall not be  disclosed to any Person  except as required by a  Governmental
Entity.

      Section 5.08. No Negotiation.

            (a)  The  Seller  shall  terminate  any  discussions   regarding  an
Acquisition  Proposal (other than  discussions  with Purchaser) and shall ensure
that neither it nor any of its  subsidiaries,  officers,  directors,  employees,
shareholders,  Affiliates, investment bankers, attorneys, accountants, agents or
other advisors or representatives of the Seller, directly or indirectly:

                  (i) solicit, initiate or knowingly facilitate or encourage the
            submission of any Acquisition Proposal; or

                  (ii) participate in any discussions or negotiations regarding,
            or furnish to any Person any  information  with  respect to, or take
            any other action to  facilitate  any  inquiries or the making of any
            Acquisition  Proposal,  or enter into any agreement  with respect to
            any Acquisition Proposal, other than with Purchaser.

            (b)  Without  limiting  the  foregoing,  it is  understood  that any
violation  of the  restrictions  set forth in this  Section 5.08 by any officer,
director,  employee,  affiliate,   shareholder,   investment  banker,  attorney,
accountant,  agent or other advisor or representative of the Seller,  whether or
not such individual is purporting to act on behalf of the Seller,  or otherwise,
shall be deemed to be a breach of this Section 5.08 by the Seller.  Seller shall
notify the  Purchaser  promptly  of the receipt of any  notice,  discussions  or
requests for information relating to an Acquisition Proposal.

      Section  5.09.  Performance  Under  Assumed  Contracts.  The Seller  shall
continue to perform in a manner  consistent  with  regular and  ordinary  course
under,  and abide by, each of the Assumed  Contracts  in all  respects and shall
otherwise fully discharge its obligations under each of the Assumed Contracts.

                                       15
<PAGE>

                                  ARTICLE VI.

                       PRE-CLOSING COVENANTS OF EACH PARTY

      Section 6.01.  Notification of Certain Matters. During the period from and
after the date hereof  through the earlier of the  termination of this Agreement
or the  Closing  Date,  each party  hereto  shall  promptly  notify the other in
writing of:

            (a)  the  discovery  by  it  of  any  event,   condition,   fact  or
circumstance  that  occurred,  arose or  existed on or prior to the date of this
Agreement or occurs,  arises or exists after the date of this Agreement and that
caused  or   constitutes   or  could  cause  or   constitute  a  breach  of  any
representation or warranty made by such party in this Agreement;

            (b) any breach of any covenant or obligation made by it; and

            (c) any event,  condition,  fact or  circumstance  that may make the
timely satisfaction of any of the conditions set forth in Article VII or Article
VIII impossible or unlikely.

      Section  6.02.  Consents.  Each party  hereto  shall use its  commercially
reasonable efforts to ensure that:

            (a) each filing,  notice or certificate required to be made or given
(pursuant to any applicable Legal Requirement,  order or Contract, or otherwise)
by it in  connection  with the  execution  and delivery of this  Agreement or in
connection with the  consummation  or performance of any of the  Transactions is
made or given as soon as practicable after the date of this Agreement;

            (b) each  Consent  set  forth on  Schedule  3.02(c)  required  to be
obtained  (pursuant to any applicable legal requirement,  order or Contract,  or
otherwise) by it in connection with the execution and delivery of this Agreement
or in connection with the consummation or performance of any of the Transactions
is obtained as soon as practicable  after the date of this Agreement and remains
in full force and effect through the Closing Date;

            (c) it shall promptly  deliver to the other parties,  a copy of each
filing  made,  each  notice  given and each  Consent  obtained  by it during the
pre-Closing period; and

            (d)  during  the   pre-Closing   period,   it  and  its   respective
representatives  cooperate  with the other  parties and with the other  parties'
representatives,  and prepare and make  available  such  documents and take such
other  actions as the other  parties may  reasonably  request in good faith,  in
connection  with any filing,  notice or Consent that it is required or elects to
make, give or obtain.

                                       16
<PAGE>

                                  ARTICLE VII.

           CONDITIONS PRECEDENT TO THE PURCHASER'S OBLIGATION TO CLOSE

      The  obligation  of the Purchaser to purchase the Assets is subject to the
satisfaction,  at or before the Closing,  of the conditions  set out below.  The
benefit of these  conditions  are for the benefit of the Purchaser  only and may
only be  waived in a writing  signed  by the  Purchaser  at any time in its sole
discretion.

      Section   7.01.   Accuracy  of   Representations   and   Warranties.   The
representations  and  warranties  of the Seller shall be true and correct in all
material  respects  (except for  representations  and  warranties  that  contain
qualifications  as to  materiality,  which  shall  be true  and  correct  in all
respects)  at and as of the date when made and as of the Closing  Date as though
made at that time, and the Purchaser shall have received a certificate attesting
thereto from the Seller signed by a duly authorized officer of the Seller.

      Section 7.02.  Performance by the Seller. The Seller shall have performed,
satisfied and complied in all material  respects with all covenants,  agreements
and conditions  required by this Agreement and the Purchaser shall have received
a certificate  signed by a duly  authorized  officer of the Seller  attesting to
that effect.

      Section  7.03.  Material  Adverse  Change.  There  shall not have been any
changes or events  that have  resulted  or could  result in a  Material  Adverse
Effect.

      Section  7.04. No  Litigation.  There shall not have been issued and be in
effect any order of any court or tribunal of  competent  jurisdiction  which (i)
prohibits  or makes  illegal the purchase by the  Purchaser of the Assets,  (ii)
would  require the  divestiture  by the  Purchaser  of all or any portion of the
Assets as a result  of the  Transactions  contemplated  hereby,  or (iii)  would
impose limitations on the ability of the Purchaser to effectively  exercise full
rights of ownership of the Assets as a result of the  Transactions  contemplated
hereby.

      Section  7.05.  No  Injunction.  On the  Closing  Date  there  shall be no
effective injunction,  writ,  preliminary  restraining order or any order of any
nature  issued  by  a  court  of  competent   jurisdiction  directing  that  the
Transactions  provided  for  herein  or any of  them  not be  consummated  as so
provided or imposing any  conditions  on the  consummation  of the  Transactions
contemplated hereby.

      Section  7.06.  Due  Diligence  Review.  The  Purchaser,  in its  sole and
absolute  discretion,  shall be satisfied  with the results of its due diligence
review as set forth in Section 5.07 hereof.

      Section 7.07. No  Encumbrances.  At the Closing,  Seller shall deliver the
Assets free and clear of any  Encumbrances  whatsoever  other than the Permitted
Encumbrances  (except  for  Permitted   Encumbrances   relating  to  the  Seller
Obligations).

      Section 7.08. Purchase Agreement.  The Purchase Agreement by and among the
Purchaser, Tadpole Entertainment,  LLC, Benny Smart, Inc., James W. Carell, John
R. Cherry,  Gerald T. Carden,  and Thomas E. Trebing dated as of the date hereof
shall not have been terminated and all of the conditions to Closing set forth in
Article XIII and Article IX therein shall be satisfied or waived.

                                       17
<PAGE>

      Section 7.09. Delivery of Schedules. If Seller updates Schedule 3.06(a) in
accordance with Section 1.05, Seller shall have delivered to Purchaser revisions
of all other  Schedules that are required to be revised in connection  with such
update that are, in each case, satisfactory to Purchaser in Purchaser's sole and
absolute discretion.

      Section  7.10.  Opinion of Counsel.  The Seller  shall have  delivered  an
opinion,  dated the  Closing  Date,  of  counsel  to the  Seller,  in a form and
substance reasonably satisfactory to Purchaser.

                                 ARTICLE VIII.

            CONDITIONS PRECEDENT TO THE SELLER'S OBLIGATIONS TO CLOSE

      The  obligation  of the  Seller  to sell  the  Assets  is  subject  to the
satisfaction,  at or before the Closing,  of the conditions  set out below.  The
benefit  of these  conditions  is for the  Seller  only and may be waived by the
Seller in writing at any time in its sole discretion.

      Section   8.01.   Accuracy  of   Representations   and   Warranties.   The
representations  and  warranties  of Purchaser  shall be true and correct in all
material  respects  (except for  representations  and  warranties  that  contain
qualifications  as to  materiality,  which  shall  be true  and  correct  in all
respects at and as of the date when made and as of the Closing  Date,  as though
made at that time),  and the Seller shall have received a certificate  attesting
thereto signed by a duly authorized officer of the Purchaser.

      Section  8.02.   Performance  by  Purchaser.   The  Purchaser  shall  have
performed,  satisfied and complied in all material  respects with all covenants,
agreements and  conditions  required by this Agreement and the Seller shall have
received a  certificate  of a duly  authorized  officer of the Purchaser to such
effect.

      Section  8.03. No  Litigation.  There shall not have been issued and be in
effect any order of any court or tribunal of  competent  jurisdiction  which (i)
prohibits or makes  illegal the sale by the Seller of the Assets or the purchase
by the Purchaser of the Assets or (ii) would impose  limitations  on the ability
of the Seller to effectively  transfer full rights of ownership of the Assets as
a result of the Transactions contemplated hereby.

      Section  8.04.  No  Injunction.  On the  Closing  Date  there  shall be no
effective injunction,  writ,  preliminary  restraining order or any order of any
nature  issued  by  a  court  of  competent   jurisdiction  directing  that  the
Transactions  provided  for  herein  or any of  them  not be  consummated  as so
provided or imposing any  conditions  on the  consummation  of the  Transactions
contemplated hereby.

                                       18
<PAGE>

                                   ARTICLE IX.

                                 INDEMNIFICATION

      Section 9.01.  Representations  and Warranties.  The  representations  and
warranties  set forth in Articles  III and IV hereof shall  survive  through the
three-year  anniversary  of  the  Closing  Date;  provided,  however,  that  the
representations  and warranties set forth in Section 3.03 and Section 3.06 shall
survive indefinitely.

      Section 9.02.  Indemnification  by the Seller. The Seller shall indemnify,
defend and hold Purchaser and its officers,  directors,  employees,  Affiliates,
representatives,  agents and the  successors and assigns of all of them harmless
up to a maximum amount equal to the Purchase Price for any and all  Liabilities,
costs or expenses  (including  reasonable  attorneys' fees),  judgments,  fines,
losses,   claims,   damages  and  amounts  paid  in  settlement   (collectively,
"Damages"):

            (a) arising from or in connection  with (i) the failure or breach of
any representation or warranty of the Seller under this Agreement (including the
schedules hereto),  in any certificate  delivered pursuant hereto to be true and
correct  as of the  date  hereof  and  as of  the  Closing  Date  or  any  other
Transaction Document,  (ii) the failure of the Seller to duly perform or observe
any term,  provision,  covenant or  agreement to be performed or observed by the
Seller  pursuant to this Agreement or any other  Transaction  Document or in the
schedules,  exhibits,  certificates  or documents  delivered by Seller  pursuant
hereto or thereto, or (iii) all Liabilities, other than the Assumed Liabilities;
and

            (b) for a period from the Closing Date to the three-year anniversary
thereof,  in the event that the  Seller  shall  have  engaged in fraud,  willful
misconduct or bad faith in connection with the  consummation of the transactions
contemplated by this Agreement.

      Section  9.03.  Sole  Remedy.  Notwithstanding  anything  to the  contrary
herein,  Purchaser's  sole remedy  against  Seller for Damages  pursuant to this
Agreement  shall be limited to the  provisions  set forth in this Article IX and
shall not exceed an aggregate amount equal to the Purchase Price.

      Section  9.04.  Claims for  Indemnification.  Within  the  indemnification
limitations  set forth in Section  9.02 above,  upon  receipt by  Purchaser of a
written notice of any action,  suit,  proceedings,  claim,  demand or assessment
against it which might give rise to a claim for  Damages,  Purchaser  shall give
written notice thereof to the Seller indicating the nature of such claim and the
basis therefor;  provided,  however,  that failure to give such notice shall not
affect the Purchaser's  rights provided  hereunder except to the extent that the
Seller's  rights shall have been actually and materially  prejudiced as a result
of such failure. Seller shall have the right, at its option,  exercisable within
10 days  after  receipt  of such  notice to assume  the  defense  of, at its own
expense and by its own counsel, any such matter involving the asserted liability
of the Purchaser as to which the Seller shall have acknowledged the right of the
Purchaser to payment by the Seller,  subject to the next sentence. If the Seller
shall undertake to compromise,  settle or defend any such asserted liability, it
shall promptly notify the Purchaser of its intention to do so, and the Purchaser
agrees to cooperate  fully with the Seller and its counsel in the  compromise or
settlement  of, or  defense  against,  any such  asserted  liability;  provided,
however,  that the Seller shall not settle any such asserted  liability  without
the  written  consent  of  the  Purchaser,  which  such  consent  shall  not  be
unreasonably withheld. Notwithstanding an election to assume the defense of such
action or  proceeding,  the  Purchaser  shall have the right to employ  separate

                                       19
<PAGE>

counsel and to participate in the defense of such action or proceeding,  and the
reasonable fees, costs and expenses of such separate counsel shall be payable by
the  Seller,  if (A) the  Seller  shall  not have  employed  counsel  reasonably
satisfactory  to the  Purchaser  to  represent  the Seller  within 20 days after
notice to the Seller of the  institution of such action or proceeding or (B) the
Seller shall have  authorized  the Purchaser to employ  separate  counsel at the
Seller's  expense and the Seller shall  promptly  assume and hold the  Purchaser
harmless  from and against the full  amount of any Damage  resulting  therefrom.
Notwithstanding  anything  herein  to the  contrary,  the  Seller  shall  not be
entitled  to assume  control of such  defense  but shall pay for the  reasonable
fees,  costs and  expenses  of  Purchaser's  legal  counsel if (i) the claim for
indemnification relates to or arises in connection with any criminal proceeding,
action, indictment, allegation or investigation; (ii) Purchaser has been advised
by counsel that a reasonable likelihood exists of a conflict of interest between
the Seller, on the one hand, and Purchaser on the other; (iii) the Seller failed
or is failing to vigorously prosecute or defend such claim; (iv) the claim seeks
an injunction or equitable relief against Purchaser; or (v) Purchaser reasonably
believes  an  adverse  determination  with  respect  to  the  action,   lawsuit,
investigation,  proceeding  or  other  claim  giving  rise  to  such  claim  for
indemnification  would be  detrimental  to or injure  the  reputation  or future
business prospects of Purchaser. If the Purchaser shall undertake to compromise,
settle or defend any  asserted  liability  in  accordance  with the  immediately
preceding  sentence,  it shall promptly notify the Seller of its intention to do
so, and the Seller agrees to cooperate  fully with the Purchaser and its counsel
in the  compromise  or  settlement  of, or defense  against,  any such  asserted
liability;  provided,  however,  that the  Purchaser  shall not  settle any such
asserted liability without the written consent of the Seller, which such consent
shall not be unreasonably  withheld. In any event, the Purchaser and its counsel
shall  cooperate with the Seller and its counsel.  The Purchaser  shall have the
right  at its own  expense  to  participate  in the  defense  of  such  asserted
liability.

      Section  9.05.  Method  of  Payment.  If a payment  is due from  Seller to
Purchaser  for  Damages,  in addition  to any other  rights  Purchaser  may have
against  Seller under this  Agreement  regarding the collection of such Damages,
Purchaser  shall at its option have the right,  in accordance with the procedure
outlined below, to collect such Damages by offsetting the amount of such Damages
against  the  Seller  Note (the  "Right of  Setoff").  If  Purchaser  desires to
exercise its Right of Setoff,  it must first  provide  Seller with 10 days prior
written  notice (the  "Setoff  Notice")  setting  forth the amount of Damages it
desires to offset (the  "Setoff  Amount") and a brief  description  of the facts
which gave rise to the Damages.  If, within such 10 day period,  Purchaser  does
not receive a written notice from Seller (an "Objection  Notice")  setting forth
Seller's  objection to either the facts giving rise to the Damages or the amount
of Damages,  Purchaser shall be allowed to exercise its Right of Setoff pursuant
to the Setoff  Notice.  If,  within  such 10 day period,  Purchaser  receives an
Objection  Notice,  the  parties  agree to meet within 20 days of the receipt of
such  Objection  Notice to make a good faith  effort to resolve  the dispute set
forth in the Objection  Notice.  If after such meeting the parties are unable to
resolve such  dispute,  the  Purchaser  agrees to pay the Setoff  Amount (on the
dates and in the  amounts  set  forth in the  Seller  Note) to an  escrow  agent
pursuant to an Escrow  Agreement in a form to be mutually  agreed upon by Seller
and  Purchaser.  Such  amount  shall be  released  by the escrow  agent upon the
earlier of either (i) the joint  direction of Purchaser and Seller,  or (ii) the
ruling of an arbitrator  pursuant to an arbitration  in accordance  with Section
12.08 hereof.

                                       20
<PAGE>

                                   ARTICLE X.

                                   TERMINATION

      Section 10.01.  Termination  Events.  This Agreement may be terminated and
the Transactions may be abandoned at any time prior to the Closing:

            (a) by mutual written consent of the Seller and Purchaser;

            (b) by the  Seller  or  Purchaser  if the  Closing  shall  not  have
occurred on or before April 30, 2005; provided, however, that

                  (i) the right to terminate this  Agreement  under this Section
            10.01(b)  shall not be available to the Seller or Purchaser,  as the
            case may be, if such party's failure to fulfill any obligation under
            this  Agreement  is the cause of or  resulted  in the failure of the
            Transactions to occur on or before such date;

                  (ii) if the  failure  to  close by such  date is a  result  of
            Seller's failure to provide  Purchaser with full and complete access
            on a timely basis to Seller's diligence materials in accordance with
            Section 5.07 hereof,  such date shall  automatically  be extended to
            May 31, 2005; and

                  (iii)  if the  failure  to  close  by such  date is not due to
            either parties failure to fulfill any of its obligations  under this
            Agreement,  the  parties  agree to meet in good  faith on or  before
            April 30, 2005,  to use their best efforts to mutually  agree upon a
            reasonable extension of such date;

            (c) by the  Seller  so long as the  Seller  is not then in  material
breach of its  obligations  hereunder,  if any of the  Conditions to Closing set
forth in Article VIII shall not have been  satisfied  and are incapable of being
satisfied by April 30, 2005; and

            (d) by Purchaser so long as Purchaser is not then in material breach
of its obligations  hereunder,  if any of the Conditions to Closing set forth in
Article VII shall not have been  satisfied and are incapable of being  satisfied
by April 30, 2005.

      Section 10.02. Effect of Termination.

            (a) In the event of  termination  of this  Agreement  by either  the
Seller or Purchaser as provided in Section 10.01, this Agreement shall forthwith
become null and void and there shall be no liability or  obligations on the part
of  Purchaser,  on the one hand,  or the  Seller,  on the  other,  or any of its
Affiliates,  officers, or shareholders except (i) with respect to the provisions
of Section 10.02(b) hereof,  and (ii) that no such termination shall relieve any
party from liability for any breach of the respective representations, covenants
and other obligations hereunder prior to the date of termination.

            (b) If this Agreement is terminated as provided herein:

                                       21
<PAGE>

                  (i) each  party  will  redeliver,  and will  cause its  agents
            (including,  without  limitation,   attorneys  and  accountants)  to
            redeliver,  all  documents,  work  papers and other  material of the
            other  party  relating  to  the  Transactions  contemplated  hereby,
            whether obtained before or after the execution hereof; and

                  (ii) each party  shall hold any  information  received  by any
            other  party with  respect to the  business,  operations,  assets or
            financial condition of such other party in strict confidence and not
            disclose  such  information  to any Person  except as  required by a
            Governmental Entity.

                                  ARTICLE XI.

                          OBLIGATIONS AFTER THE CLOSING

      Section 11.01. Further Assurances.

            (a) Seller will, at any reasonable  time,  when called upon to do so
by the Purchaser,  its successors,  legal representatives,  or assigns, sign all
lawful papers, make all rightful oaths,  execute and deliver all documents,  and
do all lawful acts required for the filing of such papers as are  reasonable and
necessary  to aid the  Purchaser,  its  successors,  legal  representatives  and
assigns, to (i) effectively vest in the Purchaser good title to the Assets, (ii)
consummate  the  Transactions  contemplated  hereby,  and (ii)  record,  obtain,
enforce and renew proper  copyright,  trademark,  patent and other  intellectual
property  rights in the Film  Library  in all  countries,  all  without  further
compensation  but at  the  expense  of  the  Purchaser,  its  successors,  legal
representatives and assigns.

            (b) Upon the  reasonable  request  of  Purchaser,  Seller  will make
available to Purchaser original versions of all accounting, financial and fiscal
records that are related to the Assets.

            (c) On and after the Closing Date, the Purchaser shall have the sole
right and authority to collect, for its own account and sole benefit, all monies
payable  in  respect  of the Assets  (with  respect  to  Transactions  or events
occurring after the Closing Date),  but not to collect monies payable in respect
of Excluded  Assets,  and the Seller shall have the sole right and  authority to
collect,  for its own account and sole benefit, all monies payable in respect of
such  Excluded  Assets.  If either  party  shall  receive any such monies of the
other,  it shall hold all such monies in trust for the sole benefit of the other
party.  Within five business days after receipt thereof,  the Seller shall cause
the transfer and delivery to the Purchaser of any monies or other property which
the Seller may receive  after the Closing  Date in payment of monies  payable in
respect of the Assets and the  Purchaser  shall (within five business days after
receipt  thereof)  cause the  transfer  and delivery to the Seller of any monies
which the  Purchaser  may receive  after the Closing Date in payment of Excluded
Assets.

            (d) Purchaser shall timely execute an assumption  agreement with the
Screen Actors Guild; provided, that, such agreement shall be consistent with the
terms of this Agreement, including without limitation Section 1.03(d) hereof.

                                       22
<PAGE>

                                  ARTICLE XII.

                                  MISCELLANEOUS

      Section  12.01.  Publicity.  Purchaser or Seller may make press  releases,
statements  or other  public  announcements  from time to time as is required to
comply  with  applicable  laws  provided,  however,  that such  items  shall not
disclose any of the material details of the Transactions other than as necessary
to  comply  with  such  applicable  laws.  Purchaser  may make  press  releases,
statements  or other public  announcements  from time to time to  publicize  its
ownership of the Assets.

      Section 12.02.  Costs.  The Purchaser,  on the one hand, and the Seller on
the  other,  shall  each  pay its  own  costs  and  expenses  incurred  by it in
negotiating  and  preparing  this  Agreement and in closing and carrying out the
Transactions contemplated by this Agreement.

      Section 12.03.  Headings.  Subject  headings are included for  convenience
only and shall not affect the interpretation of any provision of this Agreement.

      Section 12.04.  Notices.  Any notice,  demand,  request,  waiver, or other
communication  under this  Agreement  shall be in writing and shall be deemed to
have been duly  given on the date of  service  if  personally  served or sent by
facsimile  transmission,  on the  business  day after  notice is  delivered to a
courier or mailed by express mail if sent by courier delivery service or express
mail for next day delivery  and on the third day after  mailing if mailed to the
party to whom notice is to be given,  by first class  mail,  registered,  return
receipt  requested,  postage  prepaid and addressed as follows (or to such other
address  of which any such party  shall give  notice  pursuant  to this  Section
12.04):

               If to the Seller to:

                        MAC Filmworks, Inc.
                        9464 Mansfield Road, Suite A-1
                        Shreveport, LA  71118
                        Attn: Jim McCullough
                        Fax:  (318) 687-2515

                        With a Copy to:

                        Brewer & Pritchard, PC
                        3 Riverway, Suite 1800
                        Houston, TX  77056
                        Attn: Thomas C. Pritchard
                        Fax:  (713) 209-2921

                                       23
<PAGE>

               If to the Purchaser, to:

                        Amity Entertainment, Inc.
                        c/o AG Special Situation Corp.
                        245 Park Avenue - 26th Floor
                        New York, NY  10167
                        Attn: Josh Brain
                              David Roberts
                        Fax:  (212) 599-2920

               with a copy to:

                        Dechert LLP
                        30 Rockefeller Plaza
                        New York, New York  10112
                        Attn: David S. Rosenthal, Esq.
                        Fax:  (212) 698-3599

      Section 12.05.  Assignment and Successors.  Prior to Closing,  neither the
Purchaser, on the one hand, or the Seller, on the other, shall assign any rights
or delegate any duties hereunder  without the prior written consent of the other
except that  Purchaser  may assign this  Agreement  to an affiliate of Purchaser
without obtaining Seller's consent.

      Section 12.06.  Binding  Effect.  This Agreement shall be binding upon and
inure to the benefit of the successors and assigns of the parties.

      Section  12.07.  Governing  Law.  This  Agreement  shall be  construed  in
accordance  with,  and governed by, the laws of the State of New York as applied
to contracts made and to be performed  entirely in the State of New York without
regard to principles of conflicts of law.

      Section 12.08. Arbitration.

            (a) Any controversy,  claim for the recovery of any Damages or other
claim (including,  without  limitation,  whether any controversy,  claim for the
recovery of any Damages or other claim is subject to arbitration) arising out of
this Agreement,  or the breach thereof  (whether,  in any case,  involving (x) a
party  hereto,  (y)  their  transferees  or (z)  such  party's  or  transferee's
directors, officers, shareholders,  employees, representatives or agents), shall
be settled by  binding  arbitration  administered  by the  American  Arbitration
Association (the "AAA") under its Commercial  Arbitration  Rules ("Rules"),  and
shall be held in New York, New York.

            (b) The Federal  rules of evidence  shall  control the  admission of
evidence into the arbitration  proceeding.  Any applicable discovery limitations
under the Federal Rules of Civil  Procedure  (and the local rules of the Federal
District Court located in New York) shall control the form and volume of written
discovery and oral depositions that each side may conduct in preparation for the
arbitration  proceeding;  provided,  however,  that the arbitration  panel shall
specify all other matters  regarding  the conduct of such written  discovery and
oral depositions.

                                       24
<PAGE>

            (c) Any dispute  submitted  for  arbitration  shall be referred to a
panel of three arbitrators. The party or parties submitting ("Submitting Party")
the intention to arbitrate (the  "Submission")  shall  nominate one  arbitrator.
Within 10 days of receipt of the Submission,  the party or parties receiving the
Submission  ("Answering Party") shall nominate one arbitrator.  If the Answering
Party fails to timely nominate an arbitrator,  then the second  arbitrator shall
be appointed by the AAA in accordance with the Rules.  If the arbitrator  chosen
by the  Submitting  Party  and the  arbitrator  chosen  by or  selected  for the
Answering Party can agree upon a neutral arbitrator within 15 days of the choice
or selection of the Answering  Party's  arbitrator,  then such individual  shall
serve as the third arbitrator.  If no such agreement is reached, a third neutral
arbitrator  shall be  appointed  by the AAA in  accordance  with the Rules.  The
parties  agree that they shall  consent  in writing to an  expedited  proceeding
under the Rules, to the full extent the AAA can accommodate such a request.

            (d) The ruling of the  arbitrators  shall be binding and  conclusive
upon all parties hereto any other Person with an interest in the matter.

            (e) The  arbitration  provision set forth in this Agreement shall be
the  sole  dispute   resolution  process  regarding  any  controversy  or  claim
(including,  without limitation,  whether any controversy or claim is subject to
arbitration) arising out of or relating to this Agreement, or the breach thereof
(whether,  in any case,  involving (x) a party hereto,  (y) their transferees or
(z) such party's or transferee's officers, directors,  shareholders,  employees,
representatives or agents);  provided,  however,  that (i) any of the parties to
the arbitration may request the Federal  District Court located in New York, New
York (or any  applicable  New York state  court) to provide  interim  injunctive
relief  in aid of  arbitration  hereunder  or to  prevent  a  violation  of this
Agreement  pending  arbitration  hereunder  (and any such  request  shall not be
deemed a waiver  of the  obligations  to  arbitrate  set  forth in this  Section
12.08),  (ii) any ruling on the award rendered by the arbitrators may be entered
as a final judgment in a Federal District Court or any New York state court (and
each of the parties hereto irrevocably submits to the jurisdiction of such court
solely for such  purposes) and (iii)  application  may be made by a party to any
court of competent  jurisdiction  wherever  situated for enforcement of any such
final  judgment  and the  entry  of  whatever  orders  are  necessary  for  such
enforcement. In any proceeding with respect hereto, all direct, reasonable costs
and  expenses  (including,  without  limitation,  AAA  administration  fees  and
arbitrator  fees)  incurred  by the  parties  to the  proceeding  shall,  at the
conclusion of the proceeding, be paid by the party incurring same.

      Section 12.09. Entire Agreement.  This Agreement,  including the Schedules
and Exhibits  hereto,  sets forth the entire  understanding  and  agreement  and
supersedes any and all other understandings,  negotiations or agreements between
the Purchaser and the Seller relating to the sale and purchase of the Assets.

      Section   12.10.   Counterparts.   This   Agreement  may  be  executed  in
counterparts,  each of  which  shall be  deemed  an  original,  and all of which
together shall constitute a single agreement. This Agreement may be evidenced by
facsimile signatures.

      Section  12.11.  Severability.  In the  event  that any one or more of the
immaterial  provisions  contained in this Agreement shall for any reason be held
to be  invalid,  illegal or  unenforceable,  the same shall not affect any other
provision of this  Agreement,  but this Agreement shall be construed in a manner
which, as nearly as possible, reflects the original intent of the parties.

                                       25
<PAGE>

      Section 12.12. No Prejudice.  This Agreement has been jointly  prepared by
the parties  hereto and the terms  hereof  shall not be construed in favor of or
against any party on account of its participation in such preparation.

      Section  12.13.  Words in  Singular  and  Plural  Form.  Words used in the
singular form in this Agreement  shall be deemed to import the plural,  and vice
versa, as the sense may require.

      Section 12.14.  Parties in Interest.  Nothing expressed or implied in this
Agreement  is  intended  or shall be  construed  to  confer  upon or give to any
person,  firm or  corporation,  other  than the  parties  hereto,  any rights or
remedies  under or by reason of this Agreement or any  transaction  contemplated
hereby.

      Section 12.15.  Amendment and Modification.  This Agreement may be amended
or modified only by written agreement executed by all parties hereto.

      Section 12.16.  Waiver. At any time prior to the Closing, the Purchaser or
the Seller may (i) extend the time for the performance of any of the obligations
or other acts of the other,  (ii) waive any inaccuracies in the  representations
and  warranties  of the  other  contained  herein or in any  document  delivered
pursuant  hereto,  and (iii)  waive  compliance  with any of the  agreements  or
conditions of the other contained  herein.  Any agreement on the part of a party
hereto to any such  extension  or waiver  shall be valid only if set forth in an
instrument in writing  signed by the party  granting such waiver but such waiver
or failure to insist  upon strict  compliance  with such  obligation,  covenant,
agreement  or  condition  shall not  operate  as a waiver of, or  estoppel  with
respect to, any subsequent or future failure.

                                  ARTICLE XIII.

                                   DEFINITIONS

      "AAA" shall have the meaning set forth in Section 12.08(a).

      "Acquisition  Proposal" shall mean any offer or proposal for or indication
of interest in the  purchase of or the  acquisition  of (whether by operation of
law or otherwise) any of the Assets or of an equity  interest in any entity that
controls the Assets,  other than the Seller's offering set forth in registration
statement 333-70526 filed with the SEC.

      "Affiliate" shall mean, when used with respect to any Person,  (i) if such
Person is a  corporation,  any officer or director  thereof and any Person which
is, directly or indirectly,  the beneficial owner of more than ten percent (10%)
of any class of any equity security thereof, and any officer,  director, partner
or Affiliate of such beneficial owner, (ii) if such Person is a partnership, any
partner thereof,  (iii) if such Person is a limited  liability  company or other
unincorporated  association,  any member or managing agent thereof, and (iv) any
other Person (other than the Purchaser) which, directly or indirectly,  controls
or is controlled by or is under common control with such Person. For purposes of
this  definition,  "control"  (including the  correlative  terms  "controlling,"
"controlled  by" and "under common control  with"),  with respect to any Person,
shall mean possession,  directly or indirectly,  of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting  securities,  the ability to exercise  voting  power,  or by
Contract or otherwise.

                                       26
<PAGE>

      "Ancillary  Rights" shall have the meaning set forth in subsection (iv) of
the definition of Film Assets.

      "Answering Party" shall have the meaning set forth in Section 12.08(c).

      "Assets" shall have the meaning set forth in Section 1.01.

      "Assumed Contracts" shall have the meaning set forth in Section 1.01(e).

      "Assumed Liabilities" shall have the meaning set forth in Section 1.03.

      "Business" shall mean the Seller's  business of creating,  owning,  using,
marketing,  producing,  distributing,  licensing and  otherwise  exploiting on a
worldwide basis a library of television and motion picture products.

      "Business Records" shall have the meaning set forth in Section 1.01(g).

      "Closing" shall have the meaning set forth in Section 2.01.

      "Closing Cash  Consideration"  shall have the meaning set forth in Section
1.06(a).

      "Closing Date" shall have the meaning set forth in Section 2.01.

      "Code" shall mean the Internal  Revenue Code of 1986, as amended,  and the
regulations promulgated thereunder, as in effect from time to time.

      "Consents" shall mean all governmental and third party consents,  permits,
approvals, orders, authorizations,  qualifications,  and waivers necessary to be
received by a Person for the  consummation of the  Transactions  contemplated by
this Agreement.

      "Contracts"   shall   mean   all   contracts,   commitments,   agreements,
arrangements and other instruments, whether written or oral.

      "Encumbrance"  shall mean any option,  pledge,  security  interest,  Lien,
charge,   encumbrance,   restriction  (whether  on  voting,  sale,  transfer  or
disposition or otherwise)  whether imposed by agreement,  understanding,  law or
otherwise,  except those arising under  applicable  federal or state  securities
laws.

      "Excluded Assets" shall have the meaning set forth in Section 1.02.

      "Excluded Liabilities" shall have the meaning set forth in Section 1.04.

      "Film Asset Acquisition Agreement" shall mean, with respect to any Person,
a Contract  pursuant to which that Person has acquired from another  Person,  or
must acquire from another  Person,  all or any of such other Person's  rights in
the Film Library or any Film Asset.

                                       27
<PAGE>

      "Film  Asset  Exploitation  Agreements"  shall mean,  with  respect to any
Person, a Contract  pursuant to which that Person has granted to another Person,
or must grant to another  Person,  all or any of that Person's rights to exploit
the Film Library or any Film Asset.

      "Film Assets" shall mean, with respect to the Film Library, all rights and
interests therein or pertaining thereto,  including, all rights and interests of
every kind and nature of whatever  description,  present and future,  direct and
indirect,   whether  now  owned  or  hereafter  acquired   (including,   without
limitation,  any rights or interests  that revert),  throughout  the universe in
perpetuity in all media, whether now or hereafter created or devised, and by all
means,  whether  now  known  or  hereafter  created  or  devised,  in and to the
following:

                  (i) the underlying Literary Property;

                  (ii) all  copyrights,  rights  and  interests  in  copyrights,
            renewals  and  extensions  of  copyrights,   domestic  and  foreign,
            obtained upon the Film Library or the underlying  Literary  Property
            or any part  thereof,  the right  (but not the  obligation)  to make
            publication  thereof for copyright  purposes and to register  claims
            under  copyright,  the right (but not the  obligation)  to renew and
            extend such copyright and the right (but not the  obligation) to sue
            in the name of any Person for past, present and future infringements
            of copyright  and to receive all damages,  judgments,  recoveries or
            proceeds therefrom;

                  (iii) all music,  musical  compositions and master  recordings
            created  for,  used in or to be used in  connection  with  the  Film
            Library,  including,  without limitation, all copyrights therein and
            all rights to perform, copy, record,  re-record,  produce,  publish,
            reproduce  or  synchronize  any  or  all  of  said  music,   musical
            compositions and master  recordings  throughout the universe as well
            as all other  rights to  exploit  such  music  including  recording,
            soundtrack recording and music publishing rights;

                  (iv) all collateral,  allied,  ancillary and subsidiary rights
            of every kind and nature whatsoever derived from,  appurtenant to or
            related to the Film  Library or the  underlying  Literary  Property,
            including,   without  limitation,   all  production,   exploitation,
            reissue,  remake,  sequel,  prequel,  adaptations,  serial or series
            production  rights,  by any  means  and in any  medium  now known or
            hereafter  devised,  whether based upon, derived from or inspired by
            the Film  Library,  the  underlying  Literary  Property  or any part
            thereof;  all rights to use,  exploit and  license  others to use or
            exploit  any and all  music,  novelization,  publishing,  commercial
            tie-ups   and   merchandising   rights  of  every  kind  and  nature
            whatsoever,  including,  without limitation, those arising out of or
            connected  with or  inspired by the Film  Library or the  underlying
            Literary  Property,  the title or titles of the Film  Library or the
            underlying Literary Property,  the characters  appearing in the Film
            Library  or the  underlying  Literary  Property  and/or the names or
            characteristics of said characters,  and including further,  without
            limitation,  any and all commercial  exploitation in connection with
            or related to the Film Library,  all remakes,  sequels,  prequels or
            other  adaptations  and/or  derivative  works  thereof  and/or  said
            Literary Property (collectively the "Ancillary Rights");

                                       28
<PAGE>

                  (v)  all  rights  to  develop,  produce,  acquire,  reacquire,
            finance, release, sell, distribute,  subdistribute, lease, sublease,
            market,   license,   sublicense,   exhibit,   broadcast,   transmit,
            reproduce,  manufacture,  publicize  or  otherwise  exploit the Film
            Library,  the underlying  Literary Property and the Ancillary Rights
            in perpetuity,  without  limitation,  in any manner and in any media
            whatsoever  throughout the universe,  whether now known or hereafter
            developed,  including, without limitation, by projection, radio, all
            forms of television (including, without limitation, free, pay, toll,
            cable,  sustaining  subscription,  sponsored  and  direct  satellite
            broadcast),  in  theatres,  non-theatrically,  all  airline and ship
            board exploitation,  closed circuit, on cassettes,  cartridges, DVD,
            other discs and other  similar and  dissimilar  video  devices,  all
            forms of computer assisted or interactive media (including,  without
            limitation,  CD-ROM,  CD-I and similar disc systems),  all so-called
            video-on-demand and/or near video-on-demand systems however devised,
            interactive cable and by any and all other means, methods, processes
            or devices now known or hereafter conceived, devised or created;

                  (vi) all  underlying  Literary  Properties  and all  Ancillary
            Rights relating to the Film Library, including,  without limitation,
            (i) all  rights to receive  proceeds  of any  insurance,  indemnity,
            warranty or guaranty  with  respect to the Film  Library or any Film
            Asset relating  thereto and all applicable Film Contracts,  (ii) all
            claims for damages  arising out of or for breach of or default under
            all applicable  Film Contracts or otherwise,  and (iii) the right to
            terminate all applicable Film Contracts,  to perform  thereunder and
            to  compel  performance  and  otherwise  to  exercise  all  remedies
            thereunder;

                  (vii) all  agreements  with respect to the Film Library or any
            Film Asset relating thereto, including, without limitation, all Film
            Contracts  relating to the Film Library and all  agreements  for (i)
            acquisition  of rights in the Film Library or any Literary  Property
            and all rights under  distribution  and license  agreements and (ii)
            personal  and/or  professional  services,  including the services of
            writers,   directors,   performers,   producers,   special   effects
            personnel,  production  personnel,  animators,  cameramen  and other
            creative,  artistic or technical  staff and other persons  providing
            services with respect to the Film Library, to the extent applicable;

                  (viii) all Physical  Properties  relating to the Film Library,
            including  ownership  and all  access  rights  and rights to use the
            same,  all  pledgeholder,  laboratory,  access  or film  warehousing
            documents or agreements relating to the Film Library or any Physical
            Properties thereof;

                  (ix) all  insurance  of  whatever  description  placed upon or
            relating to the Film  Library or the  insurable  properties  thereof
            and/or   any  Person  or   Persons   engaged  in  the   development,
            acquisition, production, completion, delivery or exploitation of the
            Film Library, and all rights of any kind or nature whatsoever in and
            to all completion  guarantees and all other agreements and documents
            relating to production, completion, delivery and exploitation of the
            Film Library and the proceeds thereof;

                                       29
<PAGE>

                  (x) the title or titles of the Film Library  including  rights
            protected  pursuant to trademark,  service mark, unfair  competition
            and/or  other  laws,  rules or  principles  of law or equity and all
            inventions,  processes,  formulae,  licenses,  copyrights,  patents,
            patent rights, trademarks, trademarks rights, service marks, service
            mark  rights,  trade  names,  trade  name  rights,  logos,  indicia,
            corporate and company names, business source or business identifiers
            and renewals and extensions thereof,  domestic and foreign,  and the
            accompanying  goodwill relating to the Film Library,  the right (but
            not the  obligation) to register claims under  trademark,  patent or
            copyright  and to renew  and  extend  such  trademarks,  patents  or
            copyrights and the right (but not the obligation) to sue in the name
            of any Person for past, present or future infringement of trademark,
            copyright or patents;

                  (xi)  all key art,  transparencies,  photographs,  slides  and
            promotional materials of whatever nature; and

                  (xii)  all  Internet  Websites  owned and  operated  by Seller
            related  to the  Film  Library,  including  but not  limited  to the
            website names, URL addresses, domain registrations,  and any and all
            linked  websites  or pages  controlled  by Seller  and all  elements
            thereof including but not limited to all literary,  dramatic, visual
            and musical material therein.

      "Film Contracts" shall mean, with respect to any Person,  all Contracts to
which that  Person is a party  relating  to the Film  Library or any Film Asset,
including, without limitation, all Film Asset Acquisition Agreements, Film Asset
Exploitation  Agreements,  sales  agency  agreements,   financing  arrangements,
copyright mortgages, cast and crew agreements, collective bargaining agreements,
performance bonds, or other agreements of any nature whatsoever  relating to the
acquisition, production, financing, distribution, exhibition, or exploitation of
the Film Library or Film Asset.

      "Film Library" shall have the meaning set forth in Section 1.01(a).

      "GAAP" shall mean U.S. generally accepted accounting  principles,  applied
on a consistent basis.

      "Governmental  Entity"  shall mean the  government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local,  and any agency,  authority,  instrumentality,  regulatory  body,  court,
central  bank or  other  entity  exercising  executive,  legislative,  judicial,
taxing,  regulatory  or  administrative  powers or functions of or pertaining to
government.

      "Guild  Payments" shall mean the obligations  payable by the Seller or any
of its  Affiliates  pursuant to any guilds or similar  organizations,  including
without limitation the Screen Actors Guild, the Writers Guild of America and the
Directors Guild of America,  or collective  bargaining  agreements in connection
with the distribution and exploitation of the Film Assets.

                                       30
<PAGE>

      "Liabilities"  shall mean any debt,  obligation,  duty or liability of any
nature  including  indebtedness  and  any  undisclosed,   unmatured,  unaccrued,
unasserted,  contingent, indirect, conditional,  implied, vicarious, derivative,
joint,  several  or  secondary  liability,  regardless  of  whether  such  debt,
obligation,  duty or  liability  would be required to be  disclosed on a balance
sheet  prepared in  accordance  with GAAP and  regardless  of whether such debt,
obligation, duty or liability is immediately due and payable.

      "Lien" shall mean any security agreement,  financing statement (whether or
not filed),  security or other like  interest,  conditional  sale or other title
retention  agreement,  lease or  consignment  or  bailment  given  for  security
purposes,  lien, mortgage,  deed of trust,  indenture,  pledge,  constructive or
other trust or attachment.

      "Literary Properties" shall mean any and all underlying literary, dramatic
or other works  (whether  published  or  unpublished),  screenplays,  teleplays,
stories,  adaptations,  scripts,  treatments,  scenarios  and any and all  other
literary or dramatic materials of any kind on which the Film Assets are based or
which were written for or included in the Film Assets.

      "Material  Adverse Effect" shall mean a material adverse effect on (i) the
Assets,  or (ii) the validity or enforceability of (A) this Agreement or (B) the
rights or remedies of the Purchaser hereunder.

      "Objection Notice" shall have the meaning set forth in Section 9.04.

      "Participations"  shall mean the amounts (other than Residuals) payable by
any Person  pursuant to Contracts with any other Person or pursuant to Contracts
under which any Person assumed the obligations or is otherwise  obligated to pay
such  amounts,  in  connection  with  the  acquisition,  production,  financing,
distribution,  exhibition or exploitation of a Film Asset,  the payment of which
is: (a)  contingent  upon and payable  only to the extent of the receipt by such
Person of revenues from the  exploitation  of such Film Asset;  or (b) due based
upon the passage of time or the  occurrence  of an identified  event;  or (c) an
advance or guarantee of payments of the kind described in (a) or (b) above,  and
which are held by (i) actors, writers, directors, producers, other film industry
professionals,  or any of their  respective loan out companies,  (ii) production
companies  or  licensors  or  transferors  of  rights,  or  (iii)  any of  their
respective successors or assigns.

      "Permitted Encumbrances" shall have the meaning set forth in Section 3.03.

      "Person"  shall mean any  individual,  sole  proprietorship,  partnership,
joint venture, trust,  unincorporated  organization,  limited liability company,
association,  corporation, institution, entity, party, or Governmental Entity or
any other juridical entity of any kind or nature whatsoever.

      "Physical  Properties" shall mean all physical properties of every kind or
nature  of or  relating  to any  film or  program  in the Film  Library  and all
versions  thereof  and  all  teasers,   trailers,  music  videos,   featurettes,
television  spots,  outtakes,  stock  footage,  "making  of" films or  programs,
including,   without  limitation,   exposed  film,  developed  film,  positives,
negatives,  final  cut  negatives,   prints,  answer  prints,  special  effects,
preparing materials (including interpositives,  negatives,  duplicate negatives,
internegatives,  color reversals,  intermediates,  lavenders,  fine grain master

                                       31
<PAGE>

prints and matrices, title overlays, textless backgrounds and all other forms of
pre-print  elements  which may be necessary or useful to produce prints or other
copies  or  additional  pre-print  elements,  whether  now  known  or  hereafter
devised), soundtracks,  recordings, audio and video tapes and discs of all types
and gauges, tape masters,  stills, press kits and other publicity or promotional
material, cutouts, trims and any and all other physical properties of every kind
and nature relating to the Film Library in whatever state of completion, and all
duplicates,  drafts,  versions and copies of each  thereof,  all of which are in
possession or control of Seller.

      "Purchase Price" shall have the meaning set forth in Section 1.05.

      "Purchaser" shall have the meaning set forth in the Preamble.

      "Receivables" shall have the meaning set forth in Section 1.01(c).

      "Requirements  of Law"  shall  mean as to any  Person,  provisions  of the
Articles or  Certificate  of  Incorporation  and By-laws or regulations or other
organizational or governing documents of such Person, or any law, treaty,  code,
rule,  regulation,  right,  privilege,  qualification,  license or  franchise or
determination  of any  Governmental  Entity,  in each case applicable or binding
upon such Person or any of such Person's property or to which such Person or any
of  such  Person's  property  is  subject  or  pertaining  to  any or all of the
Transactions contemplated or referred to herein.

      "Residuals" shall mean all amounts (other than Participations)  payable by
any Person pursuant to guild agreements or collective bargaining agreements,  or
pursuant to Contracts  under which any such Person assumed the obligations or is
otherwise  obligated to pay such amounts,  in connection  with the  development,
acquisition, production, distribution or exploitation of a Film Asset.

      "Right of Setoff" shall have the meaning set forth in Section 9.04.

      "Rules" shall have the meaning set forth in Section 12.08(a).

      "Seller" shall have the meaning set forth in the Preamble.

      "Seller Note" shall have the meaning set forth in Section 1.06(b).

      "Seller  Obligations"  means the certain amounts owed by Seller to (i) Ken
Hartford, d/b/a Western International and (ii) Tom Ward d/b/a Saturn Producers.

      "Setoff Amount" shall have the meaning set forth in Section 9.04.

      "Setoff Notice" shall have the meaning set forth in Section 9.04.

      "Settlement  Agreement"  shall  have the  meaning  set  forth  in  Section
2.02(b)(xv).

      "Submission" shall have the meaning set forth in Section 12.08(c)

      "Submitting Party" shall have the meaning set forth in Section 12.08(c).

                                       32
<PAGE>

      "Tax Return" means any report, return, form, claim for refund, declaration
or other document or information  return or statement required to be supplied to
any  authority in  connection  with Taxes,  including any schedule or attachment
thereto and any amendment thereof.

      "Taxes" shall mean all taxes, charges,  fees, levies or other assessments,
including, without limitation,  income, gross receipts, excise, property, sales,
use, license, withholding, payroll, estimated, stamp, unemployment insurance, ad
valorem, disability,  severance, social security and franchise taxes, occupation
or other taxes,  fees,  assessments or charges of any kind whatsoever,  together
with any interest and any penalties  (including penalties for failure to file in
accordance with applicable information reporting requirements), and additions to
tax by any authority, whether federal, state or local or domestic or foreign.

      "Transaction  Documents"  shall  mean  this  Agreement  and each  document
delivered pursuant to this Agreement.

      "Transactions"  shall  mean the  asset  purchase  and  other  transactions
contemplated by the Transaction Documents.

                                       33
<PAGE>

      IN WITNESS WHEREOF,  the parties hereto have executed this Agreement as of
the date set forth above.

                                    PURCHASER

                                    AMITY ENTERTAINMENT, INC.

                                    By:
                                    Name:
                                    Title:

                                    SELLER

                                    MAC FILMWORKS, INC.

                                    By:
                                    Name:
                                    Title:

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