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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
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FORM 8-K
CURRENT REPORT
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PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
MAY 19, 1998
DATE OF REPORT (Date of earliest event reported)
BRASS EAGLE INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-23385 71-0578572
(State or other (Commission (IRS Employer
jurisidiction of File Number) Identification Number)
incorporation of
organization)
1203 A North Sixth Street, Rogers, Arkansas 72756
(Address of principal executive offices) (zip code)
(501) 621-4390
(Registrant's telephone number, including area code)
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Item 5. Other Events.
Registrant announced in a press release issued Tuesday, May 21, 1998, that
they will open its own plant for the production of paintballs. The
announcement stated that the new 24,000 square foot facility will be located in
Neosho, Missouri, and is scheduled to have some 60 employees. The new plant and
manufacturing equipment _ along with training for new personnel _ is expected
to cost approximately $4.4 million.
A copy of the press release is attached hereto as Exhibit 99 and is
incorporated herein by reference.
Item 7. Exhibits
99 Press Release dated May 19, 1998, issued by Registrant
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BRASS EAGLE INC.
BY: /s/ J. R. Brian Hanna
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J. R. Brian Hanna
Vice President _ Finance and Chief
Financial Officer and Treasurer
(on behalf of the Registrant and
as the Registrant's principal
Financial and Accounting Officer)
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EXHIBIT INDEX
EXHIBIT NO. EXHIBIT
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99 Press Release dated May 19, 1998 Issued by Registrant
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EXHIBIT 99
BRASS EAGLE INC.
PRESS RELEASE
MAY 19, 1998
Brass Eagle Inc., worldwide leader in the manufacture and distribution of
paintball guns and accessories for the fast-growing sport, today announced
plans to open its own plant for the production of paintballs.
Lynn Scott, President of Brass Eagle, said from the Company's headquarters
in Rogers, Arkansas, that the new 24,000 square foot facility will be located
in Neosho, Missouri, and is scheduled to have 60 employees. _The new facility
is important for Brass Eagle in maintaining and expanding its position of
leadership in this dynamic sport,_ he said. _Most importantly, it will assure
that we have a predictable and dependable supply of high-quality paintballs _ a
product which accounts for about 30 percent of our annual sales.
_We also are pleased that bringing this production capability in-house
will allow Brass Eagle the opportunity to enhance its margins,_ Scott
continued.
The new plant and manufacturing equipment _ along with training for new
personnel _ is expected to cost approximately $4.4 million. The expenditure is
being funded from the proceeds of the Company's Initial Public Offering
completed in November 1997. Brass Eagle expects that in 1998, these budgeted
startup costs will reduce net income by approximately $600,000. The resulting
positive margin impact of this investment will be accretive to earnings in
1999, and will enhance the Company's earnings in future years.
Production of quality paintballs is a complicated process involving soft
gelatin encapsulation and requires a certain art to produce high-quality
product. _For this reason we are fortunate to be bringing in a management team
at the new facility which is very experienced in the successful production of
quality paintballs,_ Scott said.
Work on the new facility has already begun and the Company expects to be
manufacturing product in September of this year, for immediate shipment. This
schedule allows the company to meet the peak demand for the product in the
fall.
Because of the rapid growth of the sport of paintball and the explosive
impact on Brass Eagle's sales, the Neosho manufacturing site will allow for
future growth. Terms for the new facility include options for expansion on an
additional eight acres, and to an adjacent building.
Steve DeMent, Vice President of Operations for Brass Eagle, said that
Nabholz Construction Corporation was selected as general contractor for the new
facility. _We're especially pleased to have Mike Galloway, General Manager of
Industrial Services for Nabholz at its Rogers service Center, overseeing our
project,_ DeMent said. _Galloway has had key roles in the successful and on-
time completion of number of large manufacturing facilities in Missouri using
similar manufacturing processes.
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DeMent also pointed out that Galloway's strong background in Kathabar air
control systems and extensive experience in the development of food processing
plants is particularly helpful since they employ similar technologies and
environments as found in a paintball manufacturing facility.
Brass Eagle is unique in providing a full line of products appealing to
beginner though competition level players. The Company leads the industry by
offering paintball products to consumers through easily accessible channels
such as mass merchandisers and major sporting goods retailers such as Kmart,
Wal-Mart, Meijer, The Sports Authority and Dick's Sporting Goods.<PAGE>
