UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
DATE OF REPORT COMMISSION FILE NUMBER
SEPTEMBER 18, 1998 0-21943
(Date of earliest event reported)
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FOUR MEDIA COMPANY
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 95-4599440
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2813 WEST ALAMEDA AVENUE
BURBANK, CALIFORNIA 91505
(Address of principal executive offices) (Zip code)
Registrant's telephone number including area code: 818-840-7000
Not applicable
(Former name and former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets.
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On September 18, 1998, Four Media Company ("4MC") acquired all the
outstanding shares of capital stock of MSCL, Inc. d/b/a Encore ("Encore") and
the real estate occupied by Encore, in a transaction valued at approximately
$68.6 million. Included in the transaction was $11.2 million for the purchase
of real estate beneficially owned by the shareholders of Encore and $2.4 million
for the intended exercise of purchase options on other real estate occupied by
Encore.
The aggregate cash consideration was $66.1 million less repayment of
debt of $26.2 million and less assumption of debt of $2.3 million. In addition,
486,486 shares of Four Media Company common stock were issued to Encore
shareholders. The purchase price was determined by arm's length negotiations
between 4MC and the shareholders, none of whom had any material relationship
with 4MC or any of its affiliates.
Encore provides a variety of technical and creative services to its
entertainment and commercial television customers. 4MC intends to conduct the
Encore business in a substantially similar manner as was conducted by Encore.
In connection with the acquisition, 4MC entered into employment
agreements with Larry Chernoff, Stephen McCoy, Charles Chubak, Robert Solomon,
Paul Norling and Douglas Walker.
Item 7. Financial Statements and Exhibits.
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(a) Financial Statements of Business Acquired. It is impractical to
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provide the required financial statements for Encore at this time. 4MC intends
to file the required financial statements as soon as possible, but not later
than 60 days after the date this Form 8-K is required to be filed.
(b) Pro Forma Financial Information. It is impractical to provide the
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required pro forma financial information at this time. 4MC intends to file the
required pro forma financial information as soon as possible but not later than
60 days after the date this Form 8-K is required to be filed.
(c) Exhibits.
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10.1 Stock Purchase Agreement by and among 4MC, MSCL, Inc., Charles
H. Chubak and Patricia A. Chubak, Trustees of the Chubak Family
Trust dated January 10, 1992, John S. McCoy and Elaine L. McCoy,
Trustees of the McCoy Family Trust dated November 11, 1991,
Larry E. Chernoff and Deborah H. Chernoff, Trustees of the
Chernoff Family Trust dated October 31, 1991, Robert Solomon and
Pamela Solomon, Trustees of the Solomon Family Trust dated
January 23, 1997, Paul Norling and Douglas Walker who are the
shareholders of MSCL, Inc dated September 15, 1998 (without
exhibits or schedules).
10.2 Agreement of Purchase and Sale and Escrow Instructions between
John S. McCoy and Elaine L. McCoy Trustees of the McCoy Family
Trust dated November 11, 1991, Larry E. Chernoff and Deborah H.
Chernoff, Trustees of the Chernoff Family Trust dated October
31, 1991, Charles H. Chubak and Patricia A. Chubak, Trustees of
the Chubak Family Trust dated January 10, 1992, Robert Solomon
and Pamela Solomon, Trustees of the Solomon Family Trust dated
January 23, 1997, collectively, as Sellers, and Four Media
Company, a Delaware Corporation, as Purchaser dated September
10, 1998.
10.3 Employment Agreement dated as of September 18, 1998 between Four
Media Company, a Delaware corporation, and Lawrence Chernoff.
10.4 Employment Agreement dated as of September 18, 1998 between Four
Media Company, a Delaware corporation, and Robert Solomon.
10.5 Employment Agreement dated as of September 18, 1998 between Four
Media Company, a Delaware corporation, and Charles Chubak.
10.6 Employment Agreement dated as of September 18, 1998 between Four
Media Company, a Delaware corporation, and John Stephen McCoy.
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.
Date: October 5, 1998
FOUR MEDIA COMPANY
By: /s/ Alan S. Unger
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Alan S. Unger
Vice President and Chief Financial Officer