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U.S. 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
Date of report (Date of earliest event reported) July 30, 1997
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IMPRINT RECORDS, INC.
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(Exact Name of Registrant as Specified in Its Charter)
TENNESSEE 0-26120 62-1587889
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(State or Other Jurisdiction of (Commission (I.R.S. Employer
Incorporation or Organization) File Number) Identification Number)
Cummins Station, 209 10th Avenue South, Suite 500, Nashville, TN 37203
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(Address of Principal Executive Offices)
(615) 244-9585
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(Registrant's Telephone Number, Including Area Code)
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(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)
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ITEM 5 - OTHER EVENTS
At the beginning of July, 1997, the Company announced the launch of
Imprint Entertainment, a new division that will focus on television, film and
multimedia development, production and distribution. Management of the Company
has made the decision to suspend its operations in the Country music recording
industry, which thus far have been unsuccessful, and to shift the Company's
resources to Imprint Entertainment's activities. See Exhibit 1 hereto for a
copy of a letter distributed to any stockholders contacting the Company for
information regarding the Company's plans with respect to the above, and Exhibit
2 hereto for a copy of a press release disseminated by the Company earlier this
month with respect to the above (a copy of this press release, as well as a copy
of the Company's quarterly report on Form 10-QSB for the quarter ended April 30,
1997, is also provided to any stockholder contacting the Company for
information).
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SIGNATURES
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, thereunto duly authorized.
IMPRINT RECORDS, INC.
DATE: July 30, 1997 By: /s/Roy W. Wunsch
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Roy W. Wunsch, Chairman
and Chief Executive Officer
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EXHIBIT INDEX
PAGE
Exhibit 1 Letter to Stockholders
of Imprint Records 5
dated July 7, 1997
Exhibit 2 Press Release of Imprint 7
Records dated July 2, 1997
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EXHIBIT 1
TO: SHAREHOLDERS OF IMPRINT RECORDS
DATE: July 7, 1997
Attached is a press release distributed to the media on Wednesday, July 2, 1997.
After two years of serious, but unsuccessful efforts to "break through" with
meaningful sales success in the Country music recording industry, we have no
choice but to alter our plan and make every effort to build shareholder value in
a related, but less overhead intensive manner. The attached press release
describes our plans. Bud Schaetzle, President of Imprint, will spearhead this
effort. Bud's history in film and television should give us a strong leg up in
entering this related business in a serious way (see attached).
We believe the country music business is still viable for us at some future
time. At this point, however, competition has never been more intense and the
recent announcements that DreamWorks and Disney have elected to open operations
in Nashville, have only added to the uncertainty of the business. The music
industry depends on radio as the primary exposure medium for its products; even
now, it seems clear that country radio is having difficulty handling the
enormous flow of new music.
Because of these factors, we have decided to suspend our music recording
operations immediately , and in connection there with, we have moved to
aggressively cut costs at the company. All but one member of the radio
promotion department have been laid off (six people) and one additional person
has departed Imprint to join another label. Although we continue to have some
base salary employment contract obligation with respect to those terminated,
those obligations will be, we hope, mitigated by those individuals' future
employment prospects. Promotion staffers are a highly sought after job category
at record labels, and we feel most of our laid off promotion staff should move
into similar positions with other companies within a reasonable amount of time.
All other costs associated with promoting and marketing music can be reduced or
eliminated relatively quickly. We have done so, and intend to continue to do
so.
In the past four months, we have discontinued our recording relationship with
Gretchen Peters, Charlie Major and Al Anderson. Additionally, we have recently
given Jeff Wood the approval to seek a contract with another label. Jeff
continues to be signed to Imprint for now, but no further single releases will
be forthcoming. We have not yet released the finished album on artist Ryan
Reynolds. We had high expectations for Ryan's release but have chosen to
attempt to place Ryan's Imprint Album (and transfer his Imprint contract) with a
major label, rather than jeopardize his future. Although this issue is
uncertain at this time, we have reason to believe a deal can be negotiated. If
we can negotiate such an agreement, we might recoup all costs associated with
his recording.
The company will continue, for the near term, to work with artist Bob
Woodruff. Bob's potential future success will depend primarily on performance
touring. Marketing and promotion costs will be kept to a minimum.
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Imprint President Bud Schaetzle and CEO Roy Wunsch have loaned the company
$100,000 each and these two principals have also guaranteed bank loans of
approximately $200,000 in order to allow the company to survive. Starting with
September 1996, both executives took only one half of their salary and
commencing in December 1996, the two executives deferred their total salary.
Initial cash flow from film and/or TV productions is expected in late July or
August of this year. Management is waiting for confirmation on certain film and
TV productions in order to forecast gross revenue for the next several months.
Imprint has certain liabilities related to Imprint music product positioned
in the market place. All of this product has been billed to retail and rack
jobber accounts by the company's distributor DNA. Although some of that
billing has come into the company over the last several months, not all has
been released to Imprint by the distributor, per our "reserve" agreement.
The company is meeting with DNA to reconcile Imprint's sales accounting. It
is unlikely that the product currently in retail position will sell out. Any
music product that has been collected for by Imprint from DNA, but has not
yet sold through to the consumer, is an Imprint liability. DNA has been
advised of the company's current situation and they have agreed to
work with Imprint on possible future record releases.
Recently Imprint was de-listed by NASDAQ after falling below the $2,000,000
minimum asset requirement; even though we presented a plan that would keep
Imprint above that minimum, it was ultimately rejected by NASDAQ. We hope to
re-apply for listing as soon as is practical. Imprint now trades on the OTC
Bulletin Board.
We at Imprint continue to make the maximization of shareholder value our
overriding long-term business goal, and feel our plans, as outlined above and in
the attached press release, represent the best course to follow to attain that
goal.
Questions related to Imprint Records operations can be directed to Roy Wunsch,
CEO or Bud Schaetzle, President. Given the minimum current paid staffing status
of Imprint, it would be very helpful to submit any questions via fax (615
244-9586). Don't forget to include your return fax number.
Phone calls to company from shareholders will be returned in the order they were
received, once again it would be helpful to let us know your fax number for
responses to your questions.
IMPRINT RECORDS
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EXHIBIT 2
NETWORKS NEWS
NETWORK INC - - PUBLIC RELATIONS
FOR IMMEDIATE RELEASE CONTACT: Elizabeth Thiels
Network Ink, Inc.
(615) 320-5727
Roy Wunsch
Chairman/CEO
Imprint Records
(615) 244-9585
WUNSCH AND SCHAETZLE ANNOUNCE FORMATION OF IMPRINT ENTERTAINMENT
NASHVILLE, Tenn., July 2, 1997 - - Imprint Records Chairman/CEO Roy Wunsch
today announced the launch of Imprint Entertainment, a division of the
publicly-traded company that will focus on television, film and multimedia
development, production and distribution.
Imprint President Bud Schaetzle will oversee the new division, which plans
to launch with three major projects including Kathie Lee Gifford's 1997
Christmas special for CBS, a cable event celebrating the 25th Anniversary of The
Manhattan Transfer, and a multi-star special that will mark the 125th
Anniversary of Yellowstone National Park.
Prior to the formation of Imprint, Schaetzle created numerous award-winning
TV specials and series, music videos, home videos and other multi-media events.
He said that details about the launch projects and others -- including more
television specials, and a possible syndicated variety series -- will be
announced soon.
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"This next year will be a creative and exciting phase of growth for us,"
Schaetzle said. "This is a time of opportunity for companies that can see the
big picture, and Imprint was originally conceived with a broad entertainment
view."
"The continued development of Imprint requires diversification," said
Wunsch. "A move into television and film has been a discussed part of the
company's plan, and we're fortunate to have the expertise in-house to add
television and film to Imprint's bottom line. Given that the country music
marketplace has changed dramatically since we opened our doors in 1995, this
move is key to achieving our long-term goals.
"For now we will also postpone planned artist signings and near-term
recording while the country music industry recovers from what I would describe
as temporary insanity," he said.
"If we cannot do justice to great artistry in the current industry
climate - then we need to hit the 'pause button'. The radio environment for
making progress with our music and artist goals is the most constricting that
I have ever seen," Wunsch said.
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"Our singles chart system, much of which is based on a relatively small
number of radio stations who report airplay to trade papers, has not changed in
many years, except the window for getting added to these playlists has shrunk to
only three to five weeks. In the meantime, the costs associated with artist
development have increased many times over.
"This means that fabulous new artists and exciting new projects for the
format are being left in the dust. When you have viable new music, it is
maddening to be unable to expose it to listeners in an equitable way because of
a limiting chart system and inadequate radio testing. We believe that new
artists and new music are our future. Without more breakthroughs, the format
may continue to erode and country music's market share may continue to decline.
"We believe in our artists and we're going to do our best for them, but
it's unfair to our shareholders to invest their money during such a high risk
period," Wunsch said. "The advent of more country music labels signals now as
the time for Imprint to shift its focus to film and television entertainment.
Our obligation to our shareholders demands that we do our utmost to build value
in the company."
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"We are not forsaking music," Schaetzle said. "It's the core reason we
started the company, but it's no secret that we have not been able, thus far, to
achieve the goals of our first couple of years in business. I also think the
average educated person can see right through any shallow excuses so I won't try
to make any. But known factors within our closely knit industry clearly have
contributed:
* Since our first day in business, some established labels (not all)
have speculated to key radio outlets that we would not be around long,
based on our funding resources. Some of those stations stated that to
us, and the source. It can have a definite negative effect when a
promotion department tries to do their job. Can I quantify the
effect.....no.
* Was the music wrong for a country market flooded with new artists --
how would one ever know. You can ask any label executive why any
project did not achieve it's goals and there can never be an absolute
reason other than radio resistance.
The fact is that a lot of shareholders have a stake in this company and we have
an obligation to do our utmost to create shareholder value."
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As a producer/writer/director, Schaetzle introduced Garth Brooks to
American television via NBC's landmark special This Is Garth Brooks, which
garnered the highest ratings of any single-star music special in the 1990's. He
also created the most successful music pay-per-view event in television history
with The Judds Farewell Concert, and conceived and produced the TV series The
Road and At the Ryman/Monday Night Concerts, which is currently in its third
year on TNN.
Schaetzle's other productions include such television events as Farm Aid,
and The 1997 Dove Awards, The Women of Country and The Roots of Country; and
specials, tours and live events for such artists as Celine Dion, Michael Bolton,
Reba McEntire, Kathie Lee Gifford, Bobby McFerrin, Manhattan Transfer, Wynonna,
Vince Gill, Anne Murray, Mary Chapin Carpenter and the Mavericks. He also
co-wrote (with Naomi Judd) the New York Times bestseller Love Can Build A
Bridge, a biography of The Judds which served as the basis for the hit NBC
miniseries.
Imprint Records' shares trade on the OTC Bulletin Board under the symbol
IMPR.
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