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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Amendment No.: 1
Name of Issuer: Unique Casual Restaurants, Inc.
Title of Class of Securities: Common Stock, $.01 par value
CUSIP Number: 909 15K 100
(Name, Address and Telephone Number of Person
Authorized To Receive Notices and Communications)
John Zoraian, c/o Atticus Holdings, L.L.C., 590 Madison Avenue,
32nd Floor, New York, New York 10022; (212) 829-8100
(Date of Event which Requires Filing of this Statement)
November 21, 1997
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of
Rule 13d-1(b)(3) or (4), check the following box [ ].
Note: Six copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d-1(a) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter the disclosures provided
in a prior cover page.
The information required in the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP No.: 909 15K 100
1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Timothy R. Barakett
2. Check the Appropriate Box if a Member of a Group
a.
b.
3. SEC Use Only
4. Source of Funds
WC
5. Check if Disclosure of Legal Proceedings is Required Pursuant
to Items 2(d) or 2(e)
6. Citizenship or Place of Organization
Canada
Number of Shares Beneficially Owned by Each Reporting Person
With:
7. Sole Voting Power:
1,176,806
8. Shared Voting Power:
9. Sole Dispositive Power:
1,176,806
10. Shared Dispositive Power:
11. Aggregate Amount Beneficially Owned by Each Reporting Person
1,176,806
12. Check Box if the Aggregate Amount in Row (11) Excludes
Certain Shares
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13. Percent of Class Represented by Amount in Row (11)
10.27%
14. Type of Reporting Person
IN
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This Amendment is being filed for the purposes of amending the
Reporting Person's responses to Items 4 and 7 of the original
Schedule 13D. All capitalized terms not defined herein have the
definitions given them in the original Schedule 13D.
Item 1. Security and Issuer
No change.
Item 2. Identity and Background
No change.
Item 3. Source and Amount of Funds or Other Consideration
No change.
Item 4. Purpose of Transactions
The Shares deemed to be beneficially owned by the
Reporting Person were acquired for, and are being held
for, investment purposes. The Reporting Person has
communicated with management of the Issuer and reserves
the right in the future to communicate with management,
other shareholders of the Issuer and other parties
regarding methods of enhancing shareholder value. The
Reporting Person has no plan or proposal which relates
to, or would result in, any of the actions enumerated in
Item 4 of the instructions to Schedule 13D. However, by
letter dated November 7, 1997 (the "Letter to
Management"), the Reporting Person requested that
management of the Issuer pursue certain strategic
alternatives for maximizing shareholder value. A copy
of the Letter to Management is filed herewith as
Exhibit A. The Reporting Person has provided copies of
the Letter to Management to a limited number of other
shareholders of the Issuer and reserves the right to
provide copies of the Letter to Management to other
persons, including additional shareholders of the
Issuer.
The Reporting Person, on behalf of the above mentioned
entities, reserves the right to purchase additional
Shares or to dispose of the Shares in the open market,
in privately negotiated transactions or in any other
lawful manner in the future and to take whatever action
with respect to each of such entities' holdings of the
Shares he deems to be in the best interests of such
entities.
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Item 5. Interest in Securities of Issuer
No change.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer
No change.
Item 7. Material to be Filed as Exhibits
No transactions in the Shares have been effected by
the Reporting Person since the filing of the
Schedule 13D being amended hereby.
Attached hereto as Exhibit A is a copy of the
Letter to Management.
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Signature
The undersigned, after reasonable inquiry and to
the best of his knowledge and belief, certifies that the
information set forth in this statement is true, complete
and correct.
/s/ Timothy R. Barakett
_____________________________
Timothy R. Barakett
November 24, 1997
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Exhibit A
ATTICUS CAPITAL INC.
590 Madison Avenue
New York, NY 10022
Tel. (212) 829-8100 Fax: (212) 829-8111
November 7, 1997
Board of Directors
c/o Mr. William H. Baumhauer
Chairman and Chief Executive Officer
Unique Casual Restaurants, Inc.
One Corporate Place
55 Ferncroft Road
Danvers, MA 01923
Dear Board of Directors,
As we have detailed in our recent 13-D filing,
accounts managed by our firm, Atticus Capital, have recently
purchased an additional 37,500 shares of Unique Casual
Restaurants, Inc. ("Unique" or the "Company"). Atticus
Capital now controls 1,176,806 shares of Unique representing
an approximate 10.5% ownership position in the Company. In
addition, we plan on continuing to purchase shares of Unique
in the open market.
We would like to begin by commending the Board for
its decision earlier this year to create shareholder value
through realizing the "hidden value" of the foodservice
assets. The stock market was not adequately reflecting the
underlying asset value of the foodservice operations, we
believe, due to the market's inability to look beyond the
negative business fundamentals and lack of earnings at
Fuddruckers. The Board and its advisors should also be
applauded for devising the creative, tax-efficient
transaction structure that further enhanced shareholder
value through minimizing the substantial tax-leakage that
would have resulted in a traditional sale of the foodservice
assets.
As Unique's largest shareholder, we are writing to
you because we believe that Unique still has significant
"hidden value" that is unlikely to be realized under the
current corporate structure. It is our view that negative
investor sentiment attached to the Fuddruckers operations,
which clearly depressed the valuation of Daka International,
is significantly depressing the value of the high-growth
Champps operations. Our research suggests that this
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negative sentiment is not likely to subside in the near
future.
In an effort to realize this "hidden value" for
shareholders, we feel strongly that the Board should explore
strategic alternatives including: a) a sale of the entire
Company, or b) a sale of Champps in a tax-efficient
transaction similar to the foodservice sale, followed by a
sale of Fuddruckers in due course. We believe that the
Board, in exercising its fiduciary duty to maximize
shareholder value, should pursue these types of strategic
alternatives instead of affording management additional time
to spend substantial amounts of capital to execute its
strategic plan and move its headquarters for the following
reasons:
I. Current Corporate Structure Is Not
An Appropriate Public Market Vehicle
As we stated earlier, we believe that the Board
made the proper decision to sell the foodservice operations
in the tax-efficient manner that ultimately resulted in
shareholders receiving the spin-off of Unique. Post-
transaction, the Board must now assess whether Unique is a
viable "stand alone" public company from a shareholder value
perspective.
We believe that Unique is not an appropriate public
market vehicle to create shareholder value for the following
reasons:
1) Champps and Fuddruckers Appeal to Two Totally different
Investor Bases: The "hidden value" in Champps exists
because the high-growth restaurant investor that would
afford Champps a trading multiple well in excess of
Unique's current valuation does not want to be exposed
to the restructuring and business fundamental risks
inherent in the Fuddruckers operations. As a result,
Champps is being valued at a similar multiple to
Fuddruckers by traditional value investors that are
focusing on the cash flow and restructuring
opportunities at Fuddruckers. Consequently, the current
corporate structure comprising of both a restructuring
play and a high-growth restaurant concept is destructive
to shareholder value and is creating this "hidden value"
in Champps. This logic is also consistent with the
problematic corporate structure at Daka that inhibited
the value of the high-growth foodservice operations to
be realized without exploring strategic alternatives.
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2) Lack of Investor/Research Analyst Interest: We believe
that it will be very difficult for Unique to attract the
necessary investor interest and research analyst
coverage required to create shareholder value and unlock
the "hidden value" in Champps. Our research indicates
that this is a result of: a) the low liquidity in the
stock and the small market capitalization of
approximately $65 million is unlikely to attract
sufficient institutional interest in Unique,
b) potential new investors and research analysts lack
confidence in management due to previous losses as
investors in Daka International, and c) the lack of
meaningful earnings per share in the near term is
troubling to investors as restaurant stocks typically
trade on a price/earnings basis.
The trading history of Unique post-spin-off clearly
supports our view that Unique is not viable as a "stand
alone" public entity and will again, like Daka, need the
commencement of strategic alternatives to create
shareholder value. Unique has not been able to attract
new investors to the Company's story nor successfully
articulate the "hidden value" in the Champps operation
even after speaking at investor conferences and meeting
with research analysts. Unique's stock, which began
trading on July 15, 1997 at $7.00/share, has steadily
declined for the past three and a half months hitting
recent lows of $5.75/share on October 29, 1997 (an
approximately 18% decline). This 18% decline in
Unique's stock price compares to a 1% gain in the S&P
500, a 9% gain in the Russell 2000 and a 2% decline in
the Goldman, Sachs restaurant index over the same time
period.
II. Champps Is Worth More To A Restaurant Operator
In Need of Growth Than Unique
As the Board experienced in the foodservice sale, a
well capitalized buyer that can realize meaningful
synergies in an acquisition will pay you today for the
growth that may take years to achieve (with substantial
execution risk). In light of the value destroyed in the
expansion of Fuddrucker, we feel that the execution
risks are real and sizeable in growing a "big-box"
(large capital outlay) concept such as Champps with the
current management team. We do not believe that the
risk/return tradeoff of internally growing Champps is
favorable when compared to the value that could be
derived in a sale today.
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Similar to the foodservice sale, we believe that
the value of Champps obtained in a sale of Champps could
be in excess of the current market capitalization of the
Company. As you know, Champps was purchased for $50
million in February of 1996 and the asset has been grown
significantly since then. A strategic buyer will value
Champps due to the substantial synergies and faster,
more profitable growth that they could realize. The
meaningful operational synergies include: a) overhead
cost reductions, b) purchasing cost savings, c) much
lower cost of capital and better access to capital,
d) more favorable equipment leases and rents, e) more
experienced real estate development teams at the
acquirer would lower development costs, provide better
site selection and reduce execution risk.
Recent conversations with research analysts
indicate that a number of large capitalization
restaurant companies with mature concepts are currently
in search of a high-growth restaurant concept
acquisitions such as Champps and would likely express
considerable interest in Champps if given the
opportunity. This dynamic makes a sale of Champps very
timely to maximize value of the asset.
Based on our points of view detailed above, we
would not be supportive of an initial public offering of
Champps.
We realize that the Board and management are
working diligently to enhance shareholder value.
However, as we articulated, we believe that the best
option for Unique's Board to create shareholder value is
to unlock the structurally "hidden asset", as the Board
did so successfully with Daka's foodservice operations,
by exploring strategic alternatives including a sale of
the Company or a sale of Champps in a tax-efficient
manner. We feel that it would be beneficial for all
parties involved, including the Board, shareholders,
management team and employees, for this strategic matter
to be considered by the Board and studies by its
advisors as soon as practically possible.
Thank you for the opportunity to express our views
to enhance shareholder value for all shareholders of
Unique and we hope our input was both thoughtful and
productive. Consistent with our friendly shareholder
bias, we do not plan on circulating this letter
publicly, and we see no need to make a statement in our
13-D filing, although we reserve the right to do so in
the future.
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We also reserve the right to contact other
shareholders to share our views with them.
We would like the opportunity to discuss our
concerns and ideas to unlock the "hidden asset" with the
Board at a time and location of your convenience. We
look forward to your response.
Respectfully submitted,
/s/ Timothy R. Barakett
________________________
Timothy R. Barakett
President
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