KEN WILLIAMS, CEO OF STAN LEE MEDIA- HIDES LOOTING $661,000

FROM COMPANY WEEKS BEFORE IT CEASES OPERATIONS IN ITS LAST

10Q

Ken Williams, with the collusion of Skadden Arps and its associate Rick Madden, who
served as general in house counsel for SLM, drafted the 10Q to enable Williams to hide
his personally taking a $661,000 advance on stock options that had not yet matured just
weeks befoire the stock became worthless. His action was hidden in a section entitled
Results of Operations and his name was omitted with only a reference to his title in
describing who received the $661,000! This fact was omitted from the requisite
bankruptcy filing of transfers to insiders within one year of the Chapter 11 filing.

EXCERPT FROM NOV 30, 2000 10Q STAN LEE MEDIA (SLEE)
OVERVIEW\par \par We are a digital entertainment studio that uses the Internet\par
(www.stanlee.net) to launch branded content, build global communities around\par it, and
commercialize it globally through traditional media. After launching\par these characters
on the Internet, we immediately seek to exploit the characters\par in traditional media,
such as animated and live action television programs,\par feature films, theme park
simulation films, video cassettes, DVDs and\par publishing. We also seek to exploit these
entertainment properties through\par traditional licensing and merchandising markets,
such as video games, toys and\par apparel.\par \par \par The Company expects to incur
losses for the foreseeable future as a result\par of the significant operating and capital
expenditures required to achieve its\par objectives. In order to achieve and maintain
profitability, the Company will\par need to generate revenues significantly above
historical levels. In addition, in\par order to maintain its operations, it will be necessary
for the Company to raise\par additional equity and debt financing from financial or
strategic investors. The\par Company's prospects for achieving profitability must be
considered in light of\par the risks, uncertainties, expenses, and difficulties encountered
by companies in\par the rapidly evolving market of online commerce.\par \par \par \par
\par \par \par \par 1\par \par \par <PAGE> 15\par \par

RESULTS OF OPERATIONS\par \par As of September 30, 2000, our company was

considered to be a development\par stage company as it had not recognized substantial
revenue from planned\par principal operations.\par \par Total revenues were $1,161,337
for the nine month period ended September\par 30, 2000, comprised of license fees for
the delivery of webisodes to Macromedia,\par Inc. sales of The Backstreet Project comic
books at concerts and on the\par Internet, and sales of certain comic book related
memorabilia. Since our\par formation in October 1998, we have incurred substantial
operating expenses to\par produce our branded content and expand our operations.
Operating expenses for\par the nine month period ended September 30, 2000 were
$18,478,298. Operating\par expenses have increased as we engaged additional personnel
and incurred other\par expenses in producing original characters and content for delivery
on the\par Internet and other media pursuant to existing and anticipated contractual\par
arrangements. We expect to incur operating losses at least through 2000.\par \par Three
Months Ended September 30, 2000 Compared to Three Months Ended\par September 30,
1999\par \par Total revenues were $414,978 for the three months ended September 30,
2000\par and were comprised of license fees for the delivery of webisodes to
Macromedia,\par Inc., sales of The Backstreet Project comic books at concerts and on
the\par Internet, and sales of certain comic book related memorabilia.
There were no\par revenues for the comparable period in 1999 as the Company was in its
early\par stages of development.\par \par
Total operating expenses for the three months ended September 30, 2000 were\par
$5,403,215 and were comprised of cost of revenue production of $830,884,\par
development costs of $1,561,506 and general and administrative expenses of\par
$3,014,825. \cf1\f1\fs24 Included in general and administrative expenses was $661,596
related\par to stock and stock option inventives pursuant to the employment agreement
of our\par President and CEO\b\i . \cf0\b0\i0\f0\fs20 Operating expenses for the three
months ended September 30,\par 1999 were $1,891,890. This increase was the product of
the Company expanding\par operations to include more than 133 employees and
consultants to produce our\par branded content and expand our operations.\par \par
Operating loss for the three months ended September 30, 2000 was $6,274,261 as\par
compared to a loss of $573,241 for the three months ended September 30, 1999.\par \par
Nine Months Ended September 30, 2000 Compared to nine Months Ended\par September
30, 1999.\par \par Total revenues for the nine months ended September 30, 2000 were
$1,161,337 and\par consisted of license fees for the delivery of webisodes to
Macromedia, Inc.,\par sales of The Backstreet Project comic books at concerts and on the
Internet,\par and sales of certain comic book related memorabilia. There were no
revenues for\par the comparable period in 1999 as the Company was still in its early
stages of\par development.\par \par Total operating expenses for the nine months ended
September 30, 2000 were\par $18,804,478 and were comprised of cost of revenue
production of $1,760,434,\par development costs of $4,297,310 and general and
administrative expenses of\par $12,420,554. Operating expenses for the nine months
ended September 30, 1999\par were $2,761,424 and consisted entirely of general and
administrative expenses.\par Operating expenses have increased as we engaged additional
personnel and\par incurred other expenses in producing original characters and content
for\par delivery on the Internet and other media pursuant to existing and anticipated\par
contractual arrangements.\par \par The operating loss for the nine months ended
September 30, 2000 was\par $(18,804,478) as compared to an operating loss of
$(2,861,587) for the nine\par months ended September 30, 1999. We expect to incur
operating losses at least\par through calendar year 2000.\par \par