Overview

VGTel, Inc., now doing business as 360 Entertainment & Productions, Inc. (“360” or “the Company”), is devoted to creating a multi-platform entertainment and production company offering content, production, distribution and programming for feature films, Broadway and the London stage, online/internet websites, and simulcasting into movie theatres and other venues, along with products and vehicles for financing tax credits and other products tailored to the entertainment industry.

360 recognizes that a vital aspect of today’s entertainment marketplace is to provide compelling content and innovative ways of getting that content delivered to and communicating with its intended audience. The Company enjoys a wealth of industry advisors and partners to help nurture and develop unique products, cutting edge content and attractive investment vehicles.

As the entertainment and media industry accelerates its transition to mobile access and dynamic content, companies must focus on content offerings and strategize to reach key audiences amid an increasingly digital environment. With the growing influence of new media touch points (tablets, smartphones, smart TVs), media companies may implement strategic plans to expand into new geographies and acquire new technologies. Companies must determine how they are going to reach their audiences in an increasingly digital market.

How the Company Operates

We have put together a management team (click here) and advisory board (click here) including seasoned veterans with vast entrepreneurial experience in the entertainment industry and the financial markets as well as marketing and technical professionals. Our connections and relationships in the entertainment industry will provide us the luxury of having quality projects come to our group, rather than having to see them out. Through our relationships with the two largest Broadway theatre owners, 360 will have access to the majority of New York finest stages, not only for our own projects, but also for our partner projects. Our affiliations with some of the top managers and agents in entertainment, provides an open door to “A” list talent – whether in front of the camera, the mic, or on the stage, or behind the scenes, in the booth, or in the wings - the movers and shakers of the industry.

Our Business Outlook is based on a strategy of growing and building business units through investments and acquisitions. Our various businesses will include: 

• Core Media Unit, consisting of emerging media projects in film, stage and streaming/online content. For more information, click here.
   
• Internet access/gaming Unit, an explosive growth area in the distribution of sweepstakes/gaming machines that have the look and feel of slot machines and other casino gaming devices--but that are legal in most states. For more information, click here.
   
• Emerging businesses Unit, consisting of the acquisition of new services in development. For more information, click here.  

Background

In recent years, we have witnessed the near collapse of the network television business model, following on the heels of the collapse of the traditional music and publishing industries. Content providers are losing millions of dollars in advertising revenue while battling both the piracy of premium content and wide availability of free internet content. The problem in recent years has been trying to figure out a steady source of revenue from both original online content and short form content related to traditional movies and television.

The motivation behind creating a streaming media unit is finding a viable way to monetize online content. More and more people are watching TV episodes and original web series online. We at 360 are trying to figure out a way to monetize the inevitable trend toward viewing digital content online and finding a way to embrace digital distribution as a means of revenue. We see an opportunity for business growth in the field of digital content production. By combining original content from a production company with partnerships for distribution, sponsorship and product placement, the large scope that limits many start-up production companies is eliminated. We will focus both on content, production, and partnerships for distribution and also becoming a production and distribution entity.

Dual screening?Interacting with content on the screen next to you, while simultaneously viewing linear video content on a large public screen (cinema theater or home theater), will become more common, and thus, advertisers will be attracted to this trend. These advertisers will look to develop dual story line content to allow a deeper brand experience for those who choose to interact. 

Streaming media website

We are working towards the development of a unique digital content site bringing together:

• short and feature length films shown at film festivals but that have not secured distribution
• foreign films not available in the US on DVD
• Student film projects from US and foreign film schools and film camps

Our site will provide an alternative means of distribution. Through exposure on our site, these filmmakers will still retain the ability to market their films to theatrical distributors and also use this exposure to advance their careers for their next project. 360 is currently in discussions with several independent movie theater owners/operators to provide such limited theatrical screening of such films before making them available on the site, thus providing the filmmakers the opportunity to mark their film’s “theatrical” release and attract critical review.

In addition, 360 will help bring rarely seen films back into the public eye. Through our Broadway connections, 360 will also be working with producers and rights holders to film current stage productions and capture them for posterity, and secure previously running shows that have already been recorded but not previously available for streaming distribution.

2. Financing Unit

Financing Vehicles

360 will create special purpose funds for investments in film, television, stage and various other entertainment and media projects. As each individual production has its own unique circumstances, 360 will be able to provide creative financing as the situation requires. 360 will offer primary investments such as Short-Term, Secured Debt in the form of Bridge, Gap or Print & Advertising (P&A) financing. Whenever possible, we will include Back-End Equity Kickers to enable participation in a film’s profit potential. In addition, when feasible, we will look to roll a Development Loan into a Bridge Loan; a Bridge Loan into a Gap Loan, or a Gap Loan into a P&A Loan – so as to maximize the potential of any given opportunity.

• 360 will also consider funding in other categories such as:
• Gap Loans to producers in conjunction with banks and bonding companies
• Acquisition Loans to sales companies
• Tax Credits or Incentives financing
• Post-Production financing

Debt financing will normally be the last piece of the total film financing package.  Terms will require that 360 receives repayment before repayment of other loans or any payments to equity participants.  These participation loans (known as “Last Money In-First Money Out Loans”), enables the Company to participate in more films, provides better security with quicker returns and better cash flow than traditional debt instruments. These loans will be secured by film distribution rights, the script, any other intellectual property rights and/or state tax incentives. 

Elements of the funds

• Steady, high quality deal flow from respected names in the entertainment industry
• Lower Risk/Higher Returns than many other equity funds
• Efficient, low overhead structure maximizing returns for investors
• Mature, experienced management team with strong backgrounds in finance, investment and entertainment
• Flexible structure allowing for customized loans to independent filmmakers
• Solid strategy for co-investing and participation with other financiers
• Robust, repeatable process

Investment Targets

Independent film production principals that have a successful track record in production and US and Overseas distribution. Investments may be made on a stand-alone basis or in association with other production companies. Priority will be given to films that are backed by trusted production companies and/or strategic partners with whom we may co-invest. 

Depending on the fund created, 360 may establish a minimum investment amount. Participation in these funds will be restricted to Accredited Investors as defined by Securities Exchange Commission regulations. Generally, we anticipate that these funds will seek an attractive net annual Return on Investment (ROI) based upon the annual preferred interest and the net profit distribution.

360 will offer secured investments that generate:

• Cash flow
• Near term capital appreciation
• Long term return

Market Analysis

The recent economic downturn has provided a market advantage for 360. This climate has significantly reduced the number of entertainment banks and entertainment hedge funds. The large film studios have concentrated on their own blockbuster movies in order to support their high overhead costs. This has led to a lack of liquidity for the production and distribution of mid-budget and independent films. 360 hopes to exploit this opportunity providing last-in/first-out capital for the production of films that meet strict investment criteria. This market advantage will allow 360 to charge higher than historically average rates on loans and garner higher percentages of the profits for a smaller equity investment.

Strategic Partnerships and Alliances

The Company is developing key strategic alliances with major key industry individuals and organizations to help bring credibility to the Company. These alliances typically result in extensive co-marketing by both organizations with the goal of each company driving awareness of the other company’s products and services. This is a key element of 360’s strategy. With roots in the media industries, we have developed relationships and strategic alliances with companies and organizations that will provide publicity, marketing, and technology assistance.