Black Dragon Entertainment Acquires Muscle Shoals Entertainment Inc

Business Wire, May 17, 2001

Business Editors, Entertainment Writers

HOLLYWOOD, Calif.--(BUSINESS WIRE)--May 17, 2001

Black Dragon Entertainment Inc. (OTCBB:BLDG) is pleased to announce an agreement to acquire one hundred percent of the issued and outstanding shares of Muscle Shoals Entertainment, Inc.

The acquisition will be in exchange for three shares of BLDG for each share of Muscle Shoals, for a total issuance of 7,354,400 shares of BLDG. Founded in 1992 by Ray Carolin and music industry legend Jimmy Johnson, Muscle Shoals records, engineers and produces award-winning music in virtually all musical genres for such artists as The Rolling Stones, James Brown, Linda Ronstadt, Cher, Rod Stewart, B.B. King, Bob Seger, Lynryd Skynyrd, and for such companies as Walt Disney Co. Muscle Shoals will become a wholly owned subsidiary of BLDG. Dan Tartaglia will remain as Chairman and CEO of Black Dragon, while Ray Carolin will be appointed President of the Company.

Through this acquisition, the Company is positioning itself to become a major recording label, having established key strategic relationships with a number of high-profile music industry artists, song writers and music publishers, in addition to Muscle Shoals' significant relationship with MP3.com (Nasdaq:MPPP), the Internet's most popular music website.

In a related agreement, Black Dragon will also acquire the masters to the Liquid Paper album and the contractual rights for Johnny Rourke, the artist known as Whiteout in return for the issuance of 750,000 shares of BLDG. Under the terms of the acquisition, which replaces all previous agreements, Skyline Records will join Muscle Shoals' other labels, NewVox Records and MP3 Records. New artists will be signed to traditional record label contracts and be provided with online marketing and retail marketing, promotional and distribution support (domestic and international) via a contractual relationship the Company has with Bayside Distributors -- one of the music industry's major independent retail record distributors.

Jimmy Johnson will head up production and music publishing for the record labels operated by Muscle Shoals. With over thirty years in the music industry, Jimmy Johnson has been engineer for such well known hits as The Rolling Stones' "Brown Sugar", Bob Seger's "Old Time Rock and Roll", and Percy Sledge's classic "When a Man Loves a Woman". Hit recordings such as "Mustang Sally", "Respect", "Kodachrome", and Rod Stewart's great hit "Sailin' " were recorded at Muscle Shoals with Jimmy's involvement. Jimmy Johnson, who produced Lynryd Skynyrd's biggest hit, "Sweet Home Alabama", is currently Chairman of the Board of Directors of the Alabama Music Hall of Fame, and Jimmy's Fender guitar is on display in the Rock and Roll Hall of Fame.

Revenues for the Company will be generated from the retail and online sale of recorded music, from music publishing, as the Company will become the owner of original music publishing copyrights, and by providing original music content for television, feature films, and websites.

"The music industry is growing at a rate of 9 percent each year, and research clearly indicates that consumers desire a wider choice in the selection and availability of new artists and music," says Ray Carolin. "The resources and expertise that Black Dragon brings to the table give us the impetus we need to play a major part in shaping and making a significant impact on the growth rate of recorded music sales."

"The acquisition of Muscle Shoals is tremendously exciting for Black Dragon for a number of reasons, not least of which is that it enables us to immediately establish a significant position within the $44.0 billion recording industry," says Dan Tartaglia, Black Dragon's CEO. "Muscle Shoals is known throughout the world as a 'hit record powerhouse', a title that, through the release of current projects and those currently under development, should extend to Black Dragon Entertainment as a whole."

ABOUT BLACK DRAGON ENTERTAINMENT INC.

Black Dragon Entertainment is a multi-faceted entertainment corporation focused on a targeted series of music, and innovative multi-media projects. The Company is currently aggressively expanding its involvement in the record promotion and distribution business and is developing several exciting new projects as well as its current Whoiswhiteout?" campaign and upcoming 'Liquid Paper' release.

For information, call Dan Tartaglia, CEO, at 877/700-8006 toll free, Email: info@blackdragonentertainment.com

Visit our Websites: www.blackdragonentertainment.com and www.whoiswhiteout.com

Certain information included in this release (as well as information included in oral statements or other written statements made or to be made by Black Dragon Entertainment Inc.) contains statements that are forward looking, such as statements related to the future anticipated direction of the entertainment industry, plans for future expansion, various business development activities, planned capital expenditures, future funding resources, anticipated sales growth and potential contracts. These forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual operations or results to differ materially from those anticipated.