SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
June 3, 1998
Imagica Entertainment, Inc.
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(Exact name of registrant as specified in its charter)
Florida 033-37968-A 59-2762999
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(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
Post Office Box 2121, Ocala, Florida 34478-2121
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(Address of principal executive offices including zip Code)
Registrant's telephone number, including area code: (352) 867-7860
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Item 2. Acquisition or Deposition of Assets
(a) On June 1, 1998 the Company entered into a lease with FRL Enterprises,
Inc., for sign making equipment and inkjet graphic equipment. The sign making
equipment calls for a monthly payment of $1,100 for a period of 36 months with
options at the end of the lease to continue the lease at $275.00 per month or to
purchase the equipment at 35% of the original price. The new equipment runs
eight times faster than the old equipment and will cut 48" ruby versus 28" by
the old equipment. The Company estimates labor savings in the print production
area to be a minimum of three times the cost of the equipment.
The six color inkjet printer lease payments are based on through put at the
rate of $1.00 per square foot with a minimum of $5,000.00 per month. Through put
in excess of $7,000.00 will be paid in stock options computed on the basis of
1.2 times the square feet in excess of 7,000 divided by the average per share
bid price for Imagica stock on the last five days of the establishing month.
The inkjet printer will allow the Company to produce high profit digital
prints up to 54" wide with photographic quality. With this the Company can
expand its core market of large format prints and banners produced with rapid
turn around time. Currently the Company spends in excess of $10,000 per month
with an outside supplier for products that do not meet the quality level of this
new equipment. It is the Company's intention to continue to grow in this area
through the acquisition of additional equipment as business increases.
There are four principles in FRL Enterprises, Inc., two of which are
Company employees; Bill White, Vice President and Jeff Reed, Plant Manager.
Item 5. Other Events
On May 27, 1998 the Board of Directors voted to issue 20,000 restricted
shares of the Company's stock to Mark Tishman for his services as a Director of
the Company and 75,000 restricted shares of the Company's stock to Braxton Jones
for his services as a Director and President of the Company.
The Board also voted to issue to Howard Essenfeld 600,000 restricted shares
and to Jeff Sedacca 600,000 restricted shares at the purchase price of .20 cents
per share to be paid in cash or kind.
The Board also voted to issue restricted shares to certain employees of the
Company for their service to the Company as follows:
Richard Brown 1,000
Tracie Dawson 10,000
Dawn Goshorn 1,000
Carol Monroe 7,500
Ed Ramsey 1,000
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Jeff Reed 10,000
Mark Sloughter 1,000
Steve Stevenson 500
Tim Swope 7,500
Bill White 10,000
On May 28, 1998, pursuant to advice from the Company's legal council, the
Board voted to have employees who received stock under a previous stock option
plan or in exchange for Imagica stock, return those shares to the Company. In
most if not all cases these shares were never given to the employees, but
retained by the Company's previous President, Robert Wormser. For that reason
the Board has requested the employees to relinquish all rights to these shares
in writing. Those shares and employees are as follows:
Bill White 4,147
Tracie Dawson 5,893
Carol Monroe 1,495
Richard Brown 625
Mark Sloughter 250
Dawn Goshorn 407
On May 29, 1998 the Board of Directors voted to issue 250 restricted shares
of the Company's stock to those employees with 5 or more years of employment
with the Company. There are 23 employees with 5 or more years of service to the
Company.
IMAGICA ENTERTAINMENT, INC.
By: /s/ Braxton P. Jones
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Braxton P. Jones, President
Date June 3, 1998
