exv99w3

Exhibit 99.3

UNITED STATES DEPARTMENT OF JUSTICE
OFFICE OF THE UNITED STATES TRUSTEE
CENTRAL DISTRICT OF CALIFORNIA

In Re:

The Kushner-Locke Company

Debtor(s).


CHAPTER 11 (BUSINESS)

Case Number:	Case No. LA 01-44828-SB

Operating Report Number:		91

For the Month Ending:		5/31/2009

I. CASH RECEIPTS AND DISBURSEMENTS
A. (GENERAL ACCOUNT*)


1.	TOTAL RECEIPTS PER ALL PRIOR GENERAL ACCOUNT REPORTS				11,018,438.72


2.	LESS: TOTAL DISBURSEMENTS PER ALL PRIOR GENERAL ACCOUNT REPORTS				10,686,731.07


3.	BEGINNING BALANCE:				331,707.65


4.	RECEIPTS DURING CURRENT PERIOD:
	Accounts Receivable — Post-filing

	Accounts Receivable — Pre-filing

	General Sales

	Other (Specify)	Internal Transfers		70,000.00

	**Other (Specify)


	TOTAL RECEIPTS THIS PERIOD:				70,000.00


5.	BALANCE:				401,707.65


6.	LESS: TOTAL DISBURSEMENTS DURING CURRENT PERIOD
	Transfers to Other DIP Accounts (from page 2)			0.00

	Disbursements (from page 2)			102,566.85


	TOTAL DISBURSEMENTS THIS PERIOD:***				102,566.85


7.	ENDING BALANCE:				299,140.80


8.	General Account Number(s):		1891935460
			Comerica Bank
	Depository Name & Location:		Los Angeles, CA


*		All receipts must be deposited into the general account.

**		Include receipts from the sale of any real or personal property out of the ordinary course of business; attach an exhibit specifying what was sold, to whom, terms, and date of Court Order or Report of Sale.

***		This amount should be the same as the total from page 2.

Page 1 of 16

TOTAL DISBURSEMENTS FROM GENERAL ACCOUNT FOR CURRENT PERIOD


Date	Check			*Amount		**Amount
mm/dd/yyyy	Number	Payee or DIP account	Purpose	Transfered		Disbursed		Amount
05/01/2009	Wire	ADP	Payroll Fees			$	100.96	$	100.96
05/01/2009	1424	ITE Solutions	IT / Computers			$	230.00	$	230.00
05/01/2009	1425	L. A. County Clerk	Business Filings			$	22.00	$	22.00
05/01/2009	1426	L. A. County Clerk	Business Filings			$	22.00	$	22.00
05/01/2009	1427	L. A. County Clerk	Business Filings			$	22.00	$	22.00
05/05/2009	Wire	Payroll Tax	Payroll			$	6,870.78	$	6,870.78
05/05/2009	8586	Payroll	Payroll			$	1,379.04	$	1,379.04
05/05/2009	8587	Payroll	Payroll			$	7,065.62	$	7,065.62
05/05/2009	8588	Payroll	Payroll			$	2,919.85	$	2,919.85
05/08/2009	1428	Bonded Services	Storage			$	4,000.00	$	4,000.00
05/08/2009	1429	Brandon & Morner-Ritt	Legal Fees			$	3,678.13	$	3,678.13
05/08/2009	1430	Kevin Marino Expenses	Office Supplies			$	241.42	$	241.42
05/08/2009	1431	New Wave Entertainment	Dist. Expense/ Delivery			$	32.00	$	32.00
05/08/2009	1432	Secretary of State	Corporate			$	25.00	$	25.00
05/08/2009	1433	Varien	IT / Computers			$	318.00	$	318.00
05/08/2009	1434	Xerox	Office Supplies			$	22.49	$	22.49
05/13/2009	Wire	Comerica Bank	Bank Fee			$	180.01	$	180.01
05/15/2009	Wire	ADP	Payroll Fees			$	102.96	$	102.96
05/19/2009	Wire	Payroll Tax	Payroll			$	6,539.32	$	6,539.32
05/19/2009	8589	Payroll	Payroll			$	1,379.02	$	1,379.02
05/19/2009	8590	Payroll	Payroll			$	7,056.24	$	7,056.24
05/19/2009	8591	Payroll	Payroll			$	2,788.12	$	2,788.12
05/28/2009	Wire	Payroll Tax	Payroll			$	5,186.23	$	5,186.23
05/28/2009	1435	Alice Neuhauser Expenses	Phone / Internet			$	170.43	$	170.43
05/28/2009	1436	Anthem Blue Cross	Insurance			$	2,484.00	$	2,484.00
05/28/2009	1437	Arrowhead	Office Supplies			$	15.98	$	15.98
05/28/2009	1438	AT & T	Telephone			$	76.82	$	76.82
05/28/2009	1439	Blue Shield	Insurance			$	319.00	$	319.00
05/28/2009	1441	Federal Express	Shipping			$	25.65	$	25.65
05/28/2009	1442	Global Media Television	Agent Fees			$	3,750.00	$	3,750.00
05/28/2009	1443	ITE Solutions	IT / Computers			$	345.00	$	345.00
05/28/2009	1444	Kevin Marino Expenses	Postage			$	44.00	$	44.00
05/28/2009	1445	New Beginnings Enterprises	Parking / Rent			$	4,896.51	$	4,896.51
05/28/2009	1446	Recall	Storage			$	918.84	$	918.84
05/28/2009	1447	AT & T	Internet			$	86.06	$	86.06
05/28/2009	1448	Pure Compliance	SEC Reporting			$	270.00	$	270.00
05/28/2009	8592	Payroll	Payroll			$	1,379.04	$	1,379.04
05/28/2009	8593	Payroll	Payroll			$	7,378.52	$	7,378.52
05/28/2009	8594	Payroll	Payroll			$	2,788.11	$	2,788.11
05/29/2009	Wire	ADP	Payroll Fees			$	181.54	$	181.54
05/29/2009	1449	Anthem Blue Cross	Insurance			$	4,968.00	$	4,968.00
05/29/2009	1450	Blue Shield	Insurance			$	638.00	$	638.00
05/29/2009	1451	Bonded Services	Storage			$	4,000.00	$	4,000.00
05/29/2009	1452	New Beginnings Enterprises	Parking / Rent			$	9,793.02	$	9,793.02
05/29/2009	1453	Recall	Storage			$	1,837.68	$	1,837.68
05/29/2009	1454	Payroll	Payroll			$	1,768.65	$	1,768.65
05/29/2009	1455	Payroll	Payroll			$	2,002.57	$	2,002.57
05/29/2009	1456	Payroll	Payroll			$	2,248.24	$	2,248.24

		TOTAL DISBURSEMENTS THIS PERIOD:			0.00		102,566.85	$	102,566.85


*		Fill in amounts in this column if they are TRANSFERS to another DIP account (e.g. Payroll or Tax); the “amount” column will be filled in for you.

**		Fill in amounts in this column if they are DISBURSEMENTS to outside payees; the “amount” column will be filled in for you.

Page 2 of 16

GENERAL ACCOUNT
BANK RECONCILIATION


Bank statement Date:	5/31/2009	Balance on Statement:	$	349,236.53

Plus deposits in transit (a):

Deposit Date

Deposit Amount

TOTAL DEPOSITS IN TRANSIT

0.00

Less Outstanding Checks (a):


	Check Number	Check Date	Check Amount
	1435	5/28/2009	$	170.43

	1436	5/28/2009	$	2,484.00

	1437	5/28/2009	$	15.98

	1438	5/28/2009	$	76.82

	1439	5/28/2009	$	319.00

	1441	5/28/2009	$	25.65

	1442	5/28/2009	$	3,750.00

	1443	5/28/2009	$	345.00

	1444	5/28/2009	$	44.00

	1446	5/28/2009	$	918.84

	1447	5/28/2009	$	86.06

	1448	5/28/2009	$	270.00

	1449	5/29/2009	$	4,968.00

	1450	5/29/2009	$	638.00

	1451	5/29/2009	$	4,000.00

	1452	5/29/2009	$	9,793.02

	1453	5/29/2009	$	1,837.68

	8591	5/19/2009	$	2,788.12

	8592	5/28/2009	$	1,379.04

	8593	5/28/2009	$	7,378.52

	8594	5/28/2009	$	2,788.11

	1454	5/29/2009	$	1,768.65

	1455	5/29/2009	$	2,002.57

	1456	5/29/2009	$	2,248.24


TOTAL OUTSTANDING CHECKS:						50,095.73


Bank statement Adjustments:

Explanation of Adjustments-

ADJUSTED BANK BALANCE:					$	299,140.80


*		It is acceptable to replace this form with a similar form

**		Please attach a detailed explanation of any bank statement adjustment

Page 3 of 16

UNITED STATES DEPARTMENT OF JUSTICE
OFFICE OF THE UNITED STATES TRUSTEE
CENTRAL DISTRICT OF CALIFORNIA

In Re:

The Kushner-Locke Company

Debtor(s).


CHAPTER 11 (BUSINESS)

Case Number:	Case No. LA 01-44828-SB

Operating Report Number:		91

For the Month Ending:		5/31/2009

I. CASH RECEIPTS AND DISBURSEMENTS
A. (COLLATERAL ACCOUNT*)


1.	TOTAL RECEIPTS PER ALL PRIOR GENERAL ACCOUNT REPORTS				11,908,166.69


2.	LESS: TOTAL DISBURSEMENTS PER ALL PRIOR GENERAL ACCOUNT REPORTS				11,212,365.36


3.	BEGINNING BALANCE:				695,801.33


4.	RECEIPTS DURING CURRENT PERIOD:
	Accounts Receivable — Post-filing			30,056.27

	Accounts Receivable — Pre-filing

	General Sales

	Other (Specify)	Interest		62.79

	**Other (Specify)


	TOTAL RECEIPTS THIS PERIOD:				30,119.06


5.	BALANCE:				725,920.39


6.	LESS: TOTAL DISBURSEMENTS DURING CURRENT PERIOD
	Transfers to Other DIP Accounts (from page 2)			70,000.00

	Disbursements (from page 2)			4,012.50


	TOTAL DISBURSEMENTS THIS PERIOD:***				74,012.50


7.	ENDING BALANCE:				651,907.89


8.	General Account Number(s):		323-221-556
			JP Morgan Chase
	Depository Name & Location:		New York, NY


*		All receipts must be deposited into the general account.

**		Include receipts from the sale of any real or personal property out of the ordinary course of business; attach an exhibit specifying what was sold, to whom, terms, and date of Court Order or Report of Sale.

***		This amount should be the same as the total from page 2.

Page 4 of 16

TOTAL DISBURSEMENTS FROM COLLATERAL ACCOUNT FOR CURRENT PERIOD


Date	Check			*Amount		**Amount
mm/dd/yyyy	Number	Payee or DIP account	Purpose	Transfered		Disbursed		Amount
5/7/2009	Wire	Kushner-Locke	Internal Transfer		25,000.00				25,000.00
5/14/2009	Wire	JP Morgan Lewis	Legal Fees			$	4,012.50		4,012.50
5/22/2009	Wire	Kushner-Locke	Internal Transfer		45,000.00				45,000.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00

		TOTAL DISBURSEMENTS THIS PERIOD:			70,000.00		4,012.50	$	74,012.50


*		Fill in amounts in this column if they are TRANSFERS to another DIP account (e.g. Payroll or Tax); the “amount” column will be filled in for you.

**		Fill in amounts in this column if they are DISBURSEMENTS to outside payees; the “amount” column will be filled in for you.

Page 5 of 16

COLLATERAL ACCOUNT
BANK RECONCILIATION


Bank statement Date:	5/31/2009	Balance on Statement:	$	651,907.89

Plus deposits in transit (a):

Deposit Date

Deposit Amount

TOTAL DEPOSITS IN TRANSIT

0.00

Less Outstanding Checks (a):

Check Number

Check Date

Check Amount

TOTAL OUTSTANDING CHECKS:

0.00

Bank statement Adjustments:

Explanation of Adjustments-

ADJUSTED BANK BALANCE:

651,907.89


*		It is acceptable to replace this form with a similar form

**		Please attach a detailed explanation of any bank statement adjustment

Page 6 of 16

UNITED STATES DEPARTMENT OF JUSTICE
OFFICE OF THE UNITED STATES TRUSTEE
CENTRAL DISTRICT OF CALIFORNIA

In Re:

The Kushner-Locke Company

Debtor(s).


CHAPTER 11 (BUSINESS)

Case Number:	Case No. LA 01-44828-SB

Operating Report Number:		91

For the Month Ending:		5/31/2009

I. CASH RECEIPTS AND DISBURSEMENTS
A. (COLLECTION ACCOUNT*)


1.	TOTAL RECEIPTS PER ALL PRIOR GENERAL ACCOUNT REPORTS			1,268,719.47


2.	LESS: TOTAL DISBURSEMENTS PER ALL PRIOR GENERAL ACCOUNT REPORTS			51,337.80


3.	BEGINNING BALANCE:			1,217,381.67


4.	RECEIPTS DURING CURRENT PERIOD:
	Accounts Receivable — Post-filing		14,020.81

	Accounts Receivable — Pre-filing

	General Sales

	Other (Specify)		0.00

	**Other (Specify)


	TOTAL RECEIPTS THIS PERIOD:			14,020.81


5.	BALANCE:			1,231,402.48


6.	LESS: TOTAL DISBURSEMENTS DURING CURRENT PERIOD
	Transfers to Other DIP Accounts (from page 2)		0.00

	Disbursements (from page 2)		50.00


	TOTAL DISBURSEMENTS THIS PERIOD:***			50.00


7.	ENDING BALANCE:			1,231,352.48


8.	General Account Number(s):	112391673
		City National Bank
	Depository Name & Location:	Beverly Hills, CA


*		All receipts must be deposited into the general account.

**		Include receipts from the sale of any real or personal property out of the ordinary course of business; attach an exhibit specifying what was sold, to whom, terms, and date of Court Order or Report of Sale.

***		This amount should be the same as the total from page 2.

Page 7 of 16

TOTAL DISBURSEMENTS FROM COLLECTION ACCOUNT FOR CURRENT PERIOD


Date	Check			*Amount		**Amount
mm/dd/yyyy	Number	Payee or DIP account	Purpose	Transfered		Disbursed		Amount
05/30/2009	Fee	City National Bank	Bank Fee			$	50.00		50.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00

		TOTAL DISBURSEMENTS THIS PERIOD:			0.00		50.00	$	50.00


*		Fill in amounts in this column if they are TRANSFERS to another DIP account (e.g. Payroll or Tax); the “amount” column will be filled in for you.

**		Fill in amounts in this column if they are DISBURSEMENTS to outside payees; the “amount” column will be filled in for you.

Page 8 of 16

COLLECTION ACCOUNT
BANK RECONCILIATION


Bank statement Date:	5/31/2009	Balance on Statement:	$	1,231,352.48

Plus deposits in transit (a):

Deposit Date

Deposit Amount

TOTAL DEPOSITS IN TRANSIT

0.00

Less Outstanding Checks (a):

Check Number

Check Date

Check Amount

TOTAL OUTSTANDING CHECKS:

0.00

Bank statement Adjustments:

Explanation of Adjustments-

ADJUSTED BANK BALANCE:

1,231,352.48


*		It is acceptable to replace this form with a similar form

**		Please attach a detailed explanation of any bank statement adjustment

Page 9 of 16

I. D SUMMARY SCHEDULE OF CASH

ENDING BALANCES FOR THE PERIOD: 05/01/09-05/29/09

(Provide a copy of monthly account statements for each of the below)

General Account:

299,140.80

Collateral Account:

651,907.89

Collection Account:

1,231,352.48

*Other Accounts:

Bank of Scotland — Pinocchio

Time Deposit

219,012.97

Currency: GBP

Bank of Scotland — Basil

Time Deposit

247,208.95

Currency: GBP

Edge Entertainment

172.89

KL — PWI account

731.10

BLT Venture

JV Account

95,381.96

BLT Venture

JV Account

330.45

KL\7 Venture

JV Account

39,982.82

Denial Venture

JV Account

244,741.80

Cracker LLC

JV Account

15,569.01

Swing

JV Account

13,031.13

*Other Monies:

**Petty Cash (from below):

0.00

TOTAL CASH AVAILABLE:

3,058,564.25

Petty Cash Transactions:

Date

Purpose

Amount

TOTAL PETTY CASH TRANSACTIONS:

0.00


*		Specify the Type of holding (e.g. CD, Savings Account, Investment Security), and the depository name, location & account#

**		Attach Exhibit Itemizing all petty cash transactions

Page 10 of 16

II. STATUS OF PAYMENTS TO SECURED CREDITORS, LESSORS
AND OTHER PARTIES TO EXECUTORY CONTRACTS

Post-Petition

Frequency of Payments

payments not made

Creditor, Lessor, Etc.

(Mo/Qtr)

Amount of Payment

(Number)

Total Due

TOTAL DUE:

0.00

III. TAX LIABILITIES

FOR THE REPORTING PERIOD:


		Gross Sales Subject to Sales Tax:

		Total Wages Paid:

Total Post-Petition

Date Delinquent

Amounts Owing

Amount Delinquent

Amount Due

Federal Withholding

State Withholding

FICA- Employer’s Share

FICA- Employee’s Share

Federal Unemployment

Sales and Use

Real Property

Other:

TOTAL:

0.00

Page 11 of 16

IV. AGING OF ACCOUNTS PAYABLE AND RECEIVABLE

*Accounts Payable

Accounts Receivable

Post-Petition

Pre-Petition

Post-Petition

30 days or less

21,880.00

670,756.00

31 - 60 days

61 - 90 days

91 - 120 days

Over 120 days

TOTAL:

21,880.00

0.00

670,756.00

V. INSURANCE COVERAGE

Amount of

Policy Expiration

Premium Paid

Name of Carrier

Coverage

Date

Through (Date)

Commercial Package

St. Paul Travelers

2,000,000.00

2/14/2010

Worker’s Compensation

St. Paul Travelers

1,000,000.00

1/14/2010

E & O

St. Paul Travelers

3,000,000.00

3/3/2010

Others:

VI. UNITED STATES TRUSTEE QUARTERLY FEES
(TOTAL PAYMENTS)


Quarterly Period	Total							Quarterly Fees
Ending (Date)	Disbursements		Quarterly Fees		Date Paid	Amount Paid		Still Owing
11/01-12/08		10,014,342.17		78,650.00			83,975.00		(5,325.00	)
31-Mar-2009		295,493.00		1,950.00	apply credit				1,950.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00
									0.00

				80,600.00			83,975.00		(3,375.00	)


*		Post-Petition Accounts Payable SHOULD NOT include professionals’ fees and expenses which have been incurred but not yet awarded by the court. Post-Petition Accounts Payable SHOULD include professionals’ fees and expenses authorized by Court Order but which remain unpaid as of the close of the period report

Page 12 of 16

VII. SCHEDULE OF COMPENSATION PAID TO INSIDERS

Date of Order

Gross Compensation

Authorizing

Paid During the

Name of Insider

Compensation

*Authorized Gross Compensation

Month

VIII. SCHEDULE OF OTHER AMOUNTS PAID TO INSIDERS

Date of Order

Authorizing

Amount Paid

Name of Insider

Compensation

Description

During the Month


*		Please indicate how compensation was identified in the order (e.g. $1,000/week, $2,500/month)

Page 13 of 16

IX. PROFIT AND LOSS STATEMENT
(ACCRUAL BASIS ONLY)


	May 09
Ordinary Income/Expense
Income
KL International Sales		1,500.00
Royalties		11,306.27

Total Income		12,806.27
Cost of Goods Sold
Global Media Sales Fee		3,750.00
Vision Expenses		1,339.71
Vision Sales Fee		3,840.13

Total COGS		8,929.84

Gross Profit		3,876.43
Expense
Bank Service Charges
City National — Service Charge		50.00
Comerica — Service Charge		180.01

Total Bank Service Charges		230.01
Business Filings		66.00
Copy Machine		22.49
Corporate		25.00
Delivery & Distribution Expense
Marketing		32.00
Shipping		25.65

Total Delivery & Distribution Expense		57.65
Insurance
Health		2,484.00
Health Acct.		170.43

Total Insurance		2,654.43
Internet		86.06
IT / Computers		893.00
Office Supplies		218.66
Parking		330.00
Payroll
Payroll cost — Employees		23,295.30
Payroll Fee		385.46
Responsible Officer		35,454.05

Total Payroll		59,134.81
Postage and Delivery		44.00
Professional Fees
Legal Fees		3,055.50

Total Professional Fees		3,055.50
Rent		4,390.30
SEC Reporting		270.00
Storage		4,918.84
Telephone		76.82
Telephone / E-mail Expenses		38.74

Total Expense		76,512.31

Net Ordinary Income		-72,635.88
Other Income/Expense
Other Income
Interest Income		62.79

Total Other Income		62.79

Net Other Income		62.79

Net Income		-72,573.09

Page 14 of 16

X. BALANCE SHEET
(ACCRUAL BASIS ONLY)


	May 31, 09
ASSETS
Current Assets
Checking/Savings
City National — Collection Acco		1,231,352.48
Comerica — DIP		299,140.80
KL Cash Collateral — JP Morgan		651,907.89

Total Checking/Savings		2,182,401.17
Accounts Receivable
AR — BL		15,000.00
AR — Global Media		340,000.00
AR — KL		258,333.35
AR — Vision		57,423.07

Total Accounts Receivable		670,756.42

Total Current Assets		2,853,157.59

TOTAL ASSETS		2,853,157.59

LIABILITIES & EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable		-21,880.71

Total Accounts Payable		-21,880.71

Total Current Liabilities		-21,880.71

Total Liabilities		-21,880.71
Equity
Opening Bal Equity		2,345,453.91
Retained Earnings		993,255.43
Net Income		-463,671.04

Total Equity		2,875,038.30

TOTAL LIABILITIES & EQUITY		2,853,157.59

Page 15 of 16

XI. QUESTIONNAIRE


		No	Yes

1.	Has the debtor-in-possession made any payments on its pre-petition unsecured debt, except as have been authorized by the court? If “Yes”, explain below:	x




		No	Yes
2.	Has the debtor-in-possession during this reporting period provided compensation or remuneration to any officers, directors, principals, or other insiders without appropriate authorization? If “Yes”, explain below:	x




3.	State what progress was made during the reporting period toward filing a plan of reorganization Secured creditors are negotiating the final details of the reorg plan.



4.	Describe potential future developments which may have a significant impact on the case:

5.	Attach copies of all Orders granting relief from the automatic stay that were entered during the reporting period.

		No	Yes
6.	Did you receive any exempt income this month, which is not set forth in the operating report? If “Yes”, please set forth the amounts and sources of the income below.	x




I,	Alice P. Neuhauser, Responsible Officer declare under penalty of perjury that I have fully read and understood the foregoing debtor-in-possession operating report and that the information contained herein is true and complete to the best of my knowledge.




Date		Principal for debtor-in-possession

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