Business Context and Reporting Period
This Form 8-K is filed by Wizard World, Inc. (not Prairie Operating Co.) on November 16, 2015. The report details the entry into material definitive agreements restructuring the company's relationship with CON TV, LLC ("CONtv"), effective July 1, 2015. The filing also references the issuance of a press release on November 18, 2015, regarding financial results for the quarter ended September 30, 2015.
Key Financial Metrics and Agreements
The filing outlines specific financial obligations and equity changes related to CONtv:
- Equity Interest: Wizard World retains a non-dilutable 10% membership interest in CONtv and the right to appoint one member to the CONtv Board of Directors.
- Operating Expense Cap: The company's obligation for on-going operating expenses is limited to $25,000 per month for 12 months, with an aggregate cap of $300,000.
- Payment Schedule: $150,000 was pre-paid on the execution date, with the remaining $150,000 due within 90 days.
- Content Obligations: The company is no longer obligated to provide new original content to CONtv.
Note: This filing does not contain specific revenue, profit, cash flow, margin, debt, or liquidity figures for Wizard World, Inc. Those metrics are referenced as being contained in a separate press release (Exhibit 99.1) but are not detailed in the text of this 8-K.
Material Changes
The primary material change is the restructuring of the business relationship with Cinedigm Entertainment Corp. and other partners regarding CONtv. Key changes include:
- Transition from previous ownership/operating structures to a fixed 10% non-dilutable interest.
- Cessation of obligations to produce new original content for CONtv.
- Establishment of a fixed, capped cost structure for operating expenses rather than open-ended liability.
- Continuation of a services agreement providing booth space and access at live conventions for CONtv content development.
Outlook, Risks, and Management Commentary
Management commentary is limited to the description of the executed agreements. The filing notes that the Amended and Restated License Agreement will continue for six months after the company ceases to own its 10% interest, if ever. The filing explicitly states that the financial results referenced in Item 2.02 are not deemed "filed" for purposes of Section 18 of the Exchange Act and are not incorporated by reference into other filings unless specifically cited.
Investor Verification Checklist
- Verify the full text of the Amended and Restated Operating Agreement (Exhibit 10.1) for additional terms not summarized in the 8-K.
- Review the press release (Exhibit 99.1) for actual Q3 2015 revenue, net income, and cash flow figures, as they are absent from this summary text.
- Confirm the status of the $150,000 remaining payment due within 90 days of November 16, 2015.
- Assess the impact of the reduced content obligations on future revenue streams from CONtv.