Santa Monica Pictures, LLC, Perry Lerner, Tax Matters Partner - Page 332

                                       - 99 -                                         
               SMP neither received nor reported any income from film                 
          financing, film library licensing, or video rights licensing                
          during its taxable years ended 1997 and 1998.                               
               B.  Corona                                                             
               Corona has never had any employees.  During the taxable                
          years ended December 31, 1997 and 1998, Corona had no separate              
          office of its own; it used the same business address as Crown               
          Capital.                                                                    
               Corona received no income from film financing, film library            
          licensing, or video rights licensing during its taxable years               
          ended December 31, 1997 and 1998.                                           
               C.  SMHC                                                               
               SMHC had no employees from December 11, 1996, until it was             
          dissolved in 1999.  All its work was done by Crown Capital.  SMHC           
          had no bank account from December 11, 1996 until December 1998.             
          During the taxable years ended December 31, 1997 and 1998, SMHC             
          did not have a separate office of its own; it used the same                 
          business address as Crown Capital.                                          
          XIV. Partnership Tax Returns                                                
               A.  SMP                                                                
               Following an extension to October 15, 1998, SMP filed its              
          1997 partnership tax return, which it dated October 14, 1998.               
          Following an extension to October 15, 1999, SMP filed its 1998              
          partnership tax return, which it dated October 14, 1999.  SMP               






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