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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): September 7, 1999
- ---------------------------------------------------------------------------
CBRL GROUP, INC.
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(Exact name of registrant as specified in its charter)
Tennessee 0-25225 62-1749513
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(State or other (Commission (I.R.S. Employer
jurisdiction of File No.) Identification No.)
incorporation)
305 Hartmann Drive, Lebanon, Tennessee 37087
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (615) 444-5533
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ITEM 5. OTHER EVENTS.
On September 7, 1999, the Board of Directors of CBRL Group, Inc., a
Tennessee corporation (the "Company"), authorized and declared a dividend
distribution of one right (each a "Right" and collectively, the "Rights") for
each share of common stock of the Company, $0.01 par value (the "Common
Stock"), outstanding at the close of business on September 27, 1999 (the
"Record Date"). In addition, the Company has authorized the issuance of one
Right with respect to each share of Common Stock that becomes outstanding
between the Record Date and the earlier of the Distribution Date or the
Expiration Date (as such terms are hereafter defined) or the date, if any, on
which the Rights are redeemed.
When exercisable, each Right entitles the registered holder, from the
Distribution Date (as hereinafter defined) until August 31, 2009 or the
earlier redemption or exchange of the Rights, to purchase from the Company
one share of Common Stock for $65.00 (the "Purchase Exercise Price"), subject
to certain adjustments. The description and terms of the Rights are set
forth in a Rights Agreement (the "Rights Agreement"), dated as of September
7, 1999 between the Company and SunTrust Bank, Atlanta (the "Rights Agent"),
the Rights Agent appointed by the Company. The Rights Agreement specifying
the terms of the Rights is incorporated by reference as an exhibit hereto.
The terms of the Rights are summarized below and the following description of
the Rights is qualified in its entirety by reference to the Rights Agreement.
Capitalized terms used in the description have the meanings ascribed to such
terms in the Rights Agreement.
The Rights will be evidenced by the Common Stock certificates until the
close of business on the earlier of the following dates (either, the
"Distribution Date"):
(1) the tenth business day (or such later date as the Board of
Directors of the Company may from time to time fix by
resolution adopted prior to the Distribution Date that would
otherwise have occurred) after the date on which any Person
commences a tender or exchange offer which, if consummated,
would result in such Person's Beneficially Owning 30% or more
of the outstanding Common Stock, or
(2) the "Flip-in Date," which is the tenth business day after
the first date of public announcement by the Company that a
Person has become an Acquiring Person (as defined below),
other than as a result of a Flip-over Transaction (as
defined below) (or such earlier or later date as the Board of
Directors of the Company may fix from time to time by
resolution adopted prior to the Flip-in Date that otherwise
would have occurred).
If, however, a tender or exchange offer referred to in clause (1) above
is cancelled, terminated or otherwise withdrawn prior to the Distribution
Date without the purchase of any shares of stock pursuant thereto, such offer
shall be deemed never to have been made.
2
An "Acquiring Person" is any Person having Beneficial Ownership of 15%
or more of the outstanding shares of Common Stock. The term provides, for
purposes of the Rights, that any Acquiring Person and its Affiliates and
Associates be counted together as a single Person.
The term "Acquiring Person," however, does not include:
(1) the Company, any wholly-owned subsidiary of the Company or
any employee stock ownership or other employee benefit plan
of the Company or a wholly-owned subsidiary of the Company,
(2) any person who is the Beneficial Owner of 15% or more of the
outstanding Common Stock as of the date of the Rights
Agreement or who becomes the Beneficial Owner of 15% or more
of the outstanding Common Stock solely as a result of an
acquisition of Common Stock by the Company, until such time
as such Person acquires additional Common Stock, other than
through a dividend or stock split,
(3) any Person who, within 5 Business Days of being notified by
the Company of its status as an Acquiring Person, certifies
to the Company that the Person acquired Beneficial Ownership
of 15% or more of the Common Stock inadvertently or without
knowledge of the Rights Agreement, and without any intention
to affect control of the Company, and the certification is
determined by a majority of the Company's Board of Directors
to have been made in good faith, if that Person divests as
promptly as practicable (but in no event more than 30
calendar days following the certification) a sufficient
number of shares of Common Stock so that the Person then
Beneficially Owns less than 15% of the outstanding Common
Stock, or
(4) any Person who Beneficially Owns shares of Common Stock
consisting solely of: (a) shares acquired pursuant to the
grant or exercise of an option granted by the Company in
connection with an agreement to merge with, or acquire, the
Company at a time at which there is no Acquiring Person, (b)
shares owned by such Person and its Affiliates and
Associates at the time of such grant and (c) shares,
amounting to less than 1% of the outstanding Common Stock,
acquired by Affiliates and Associates of such Person after
the time of such grant.
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Stock. Common Stock
certificates issued prior to the Distribution Date shall evidence one Right
for each share of Common Stock represented thereby and shall contain a legend
incorporating by reference the terms of the Rights Agreement (as such may be
amended from time to time). Notwithstanding the absence of the
aforementioned legend, certificates evidencing shares of Common Stock
outstanding on or prior to September 27, 1999 also shall evidence one Right
for each share of Common Stock evidenced thereby. Promptly following the
Distribution Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of Common Stock at the
Distribution Date.
3
The Rights are not exercisable until the Business Day following the
Distribution Date. The Rights expire on the earliest of the following dates
(in any such case, the "Expiration Time"):
(1) the Exchange Time (as defined below),
(2) the close of business on August 31, 2009,
(3) the date on which the Rights are redeemed as described below,
and
(4) upon the merger of the Company into another corporation
pursuant to an agreement entered into when there is no
Acquiring Person.
The Purchase Exercise Price and the number of Rights outstanding, or in
certain circumstances the securities purchasable upon exercise of the Rights,
are subject to adjustment from time to time to prevent dilution in the event
of a Common Stock dividend on, or a subdivision or a combination into a
smaller number of shares of, Common Stock, or the issuance or distribution of
any securities or assets in respect of, in lieu of or in exchange for Common
Stock.
In the event that, prior to the Expiration Time, a Flip-in Date occurs,
the Company must take such action as is necessary to ensure and provide that
each Right (other than Rights Beneficially Owned by the Acquiring Person or
any Affiliate or Associate thereof, which Rights shall become void) shall
constitute the right to purchase from the Company, upon the exercise thereof
in accordance with the terms of the Rights Agreement, that number of shares
of Common Stock of the Company having an aggregate Market Price, on the date
of the public announcement of an Acquiring Person's becoming such (the "Stock
Acquisition Date") that gave rise to the Flip-in Date, equal to twice the
Purchase Exercise Price for an amount in cash equal to the then current
Purchase Exercise Price.
In addition, to the extent not prohibited by applicable law, the Board
of Directors of the Company may, at its option, at any time after a Flip- in
Date, elect to exchange all (but not less than all) the then outstanding
Rights (other than Rights Beneficially Owned by the Acquiring Person or any
Affiliate or Associate thereof, which Rights become void), and if there shall
be insufficient authorized but unissued shares of Common Stock to permit the
exercise in full of the Rights, each Right shall automatically be exchanged
for shares of Common Stock at an exchange ratio of one share of Common Stock
per Right appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date of the Distribution Date (the
"Exchange Ratio"). Immediately upon such action by the Board of Directors
(the "Exchange Time"), the right to exercise the Rights will terminate and
each Right will thereafter represent only the right to receive a number of
shares of Common Stock equal to the Exchange Ratio.
The Rights Agreement also requires certain actions by the Company in the
event that after an Acquiring Person exists and controls the Company's Board
of Directors, the Company enters
4
into, consummates or permits to occur a transaction or series of transactions
in which any of the following, directly or indirectly, occurs (any such event
a "Flip-over Transaction"):
(1) the Company consolidates, merges or participates in a
binding share exchange with any other Person if any term of
or arrangement concerning the treatment of shares
of capital stock in such merger, consolidation or share
exchange relating to the Acquiring Person is not identical to
the terms and arrangements relating to other holders of Common
Stock or
(2) the Company sells or otherwise transfers (or one or more of
its subsidiaries sells or otherwise transfers) assets: (a)
aggregating more than 50% of the assets (measured by either
book value or fair market value); or (b) generating more
than 50% of the operating income or cash flow of the Company
and its subsidiaries (taken as a whole) to any other Person
(other than the Company or one or more of its wholly owned
subsidiaries) or to two or more such Persons which are
affiliated or otherwise acting in concert.
The Company must take such action as is necessary to ensure, and may not
enter into, consummate or permit to occur a Flip-over Transaction until it
has entered into a supplemental agreement with the Person engaging in the
Flip-over Transaction or the parent corporation of that Person (the "Flip-
over Entity"), for the benefit of the holders of the Rights, providing, that
upon consummation or occurrence of the Flip-over Transaction:
(1) each Right shall thereafter constitute the right to
purchase, for an amount in cash equal to the then current
Purchase Exercise Price, from the Flip-over Entity, upon
exercise of the Right in accordance with the terms of the
Rights Agreement, that number of shares of common stock of
the Flip-over Entity having an aggregate Market Price on the
date of consummation or occurrence of the Flip-over
Transaction equal to twice the Purchase Exercise Price; and
(2) the Flip-over Entity thereafter shall be liable for, and
shall assume, by virtue of the Flip-over Transaction and
such supplemental agreement, all the obligations and duties
of the Company pursuant to the Rights Agreement.
The Board of Directors of the Company may, at its option, at any time
prior to the close of business on the Flip-in Date, redeem all (but not less
than all) the then outstanding Rights at a price of $0.01 per Right (the
"Redemption Price"), as provided in the Rights Agreement. Immediately upon
the action of the Board of Directors of the Company to redeem the Rights,
without any further action and without any notice, the right to exercise the
Rights will terminate and each Right will thereafter represent only the right
to receive the Redemption Price in cash or securities, as determined by the
Company's Board of Directors, for each Right so held.
The holders of Rights will, solely by reason of their ownership of
Rights, have no rights as stockholders of the Company, including, without
limitation, the right to vote or to receive dividends.
5
The present distribution of the Rights is not taxable to the Company or
its shareholders. The Rights are not dilutive and will not affect reported
earnings per share. The Company will receive no proceeds from the issuance
of the Rights.
The Rights have certain anti-takeover effects. The Rights may cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors of the Company, except
pursuant to an offer conditioned on a substantial number of Rights being
acquired. The Rights should not interfere with any merger or other business
combination approved by the Board of Directors prior to the time that a person
or group has acquired beneficial ownership of 15% or more of the Common Stock,
since until ten business days after such time the Rights may be redeemed by
the Company at $0.01 per Right.
The Company announced the distribution of the Rights on September 8, 1999.
In the press release in which the announcement was made, the Company
inadvertently referred to the Record Date for distribution of the Rights as
September 7, 1999 rather than September 27, 1999. The actual Record Date for
distribution of the Rights is September 27, 1999.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS.
EXHIBIT DESCRIPTION
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4 Rights Agreement, dated as of September 7, 1999, between
CBRL Group, Inc. and SunTrust Bank, Atlanta, which includes
as Exhibit A thereto the form of a Rights Certificate,
filed as Exhibit 1 to the Registrant's Registration
Statement on Form 8-A filed with the Commission on September
21, 1999 and incorporated herein by this reference.
99.1 Letter to be sent to shareholders of record on
September 27, 1999
SIGNATURE
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 hereunto duly authorized.
Dated: September 21, 1999 CBRL GROUP, INC.
By: /s/ James F. Blackstock
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Name: James F. Blackstock
Title: Vice President, Secretary and
General Counsel
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EXHIBIT INDEX
Exhibit Description Page No.
_______ ___________ ________
99.1 Letter to be sent to shareholders of record
on September 27, 1999 8
[CBRL GROUP, INC. LOGO]
Dear Shareholder:
I am pleased to inform you that on September 7, 1999, the Board of Directors
of CBRL Group, Inc. (the "Company") adopted a Rights Agreement comprising a
shareholder rights plan (the "Plan"). We believe that this Plan will help
protect the value of your investment in CBRL Group, Inc. With this letter,
we are sending you a summary describing the Plan. The adoption of this Plan
requires no action on your part.
The purpose of the Plan is to assure that all shareholders are treated fairly
by anyone who might seek to obtain control of the Company. The business
environment has changed in many ways over the years, and the corporate
takeover environment provides hostile bidders with a variety of coercive
takeover tactics. Your Board believes that a shareholder rights plan
continues to be an important tool to enable the Board to effectively
represent the interests of all shareholders in the event of an unsolicited
takeover attempt. The Plan is not unique, over 2,000 corporations throughout
the country have adopted shareholder rights plans.
The Plan was not adopted because of any current effort by another party to
acquire the Company. We are not aware of any present effort to acquire
control of the Company, but the existence of the Plan should help protect you
against unfair takeover techniques such as open-market accumulations of large
blocks of stock, partial or two-tiered offers that do not treat shareholders
equally and other similar tactics which do not provide all the shareholders
the full value of their investment.
Unless the Rights established by the Plan are redeemed by the Company, the
occurrence of certain takeover-related events will cause the Rights to
convert into the right to acquire securities of the Company (or of the
acquiror) at a significant discount. These takeover-related events include
the merger of the Company with and into any other person and the sale or
transfer of assets or earning power aggregating more than 50% of the
Company's assets or earning power. The effect is to dilute the acquiring
person's interest in the Company and to raise the price of acquiring the
Company. Since the Rights are subject to redemption prior to the occurrence
of certain events, a potential acquiror can avoid triggering the Rights by
negotiating with the Company's Board of Directors to establish a full and
fair offering price.
This Plan does not in any way alter the financial strength of the Company or
interfere with its business strategy or operations. The adoption of the plan
is not dilutive, does not affect reported earnings per share, is not taxable
to you or the Company, and will not affect your trading of common stock.
The Board and management are enthusiastic about the potential of the Company
to build long-term shareholder value and we are committed to serving the best
interests of Company shareholders, employees and the communities in which we
operate. We believe CBRL Group, Inc. has a bright future. The distribution
to you of the Rights under the Plan reflects our determination that you, our
shareholders, be given every opportunity to participate fully in that future.
Very truly yours,
/s/ Dan W. Evins
September 27, 1999 Dan W. Evins
Chairman & Chief Executive Officer
[Cracker Barrel CBRL GROUP, Inc. [Logan's
Old Country Post Office Box 787 . Lebanon, Tennessee 37088-0787 Roadhouse
Store Logo PHONE 615.444.5533 * FACSIMILE 615.443.9818 Logo]
SUMMARY
OF
CBRL GROUP, INC.
RIGHTS AGREEMENT
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Distribution and The Board has declared a dividend of one
Transfer of Rights; Right for each share of CBRL Group, Inc.
Rights Certificates: Common Stock outstanding. Future shares
- ------------------- issued by the Company, if any, will carry
the same Rights. Prior to the Distribution
Date, the Rights are evidenced by and trade
with the Common Stock and the Rights are
not exercisable. After the Distribution
Date, the Rights Agent would mail Rights
Certificates to stockholders and the Rights
would become transferable apart from the
Common Stock.
Distribution Date: Rights would separate from the Common Stock
- ----------------- and become exercisable following the
earlier of (i) the date of the "Flip-in"
Trigger or (ii) the 10th business day (or
later date the Board may designate) after
any person commences a tender or exchange
offer that would result in that person
holding a total of 30% or more of the
Common Stock.
Exercise of Rights: After the Distribution Date, each Right
- ------------------ would entitle the holder to purchase, for
the Purchase Exercise Price of $65.00,
one share of Common Stock. See "Flip-in"
Trigger for effect if Distribution Date is
caused by the "Flip-in" Trigger.
"Flip-in" Trigger: If any person becomes the beneficial owner
- ----------------- (defined broadly to encompass groups acting
in concert) of 15% or more of the
outstanding Common Stock (an "Acquiring
Person") (15% or greater blocks existing as
of the date of the adoption of the
agreement will not be Acquiring Persons so
long as no additional shares are acquired,
other than through a stock split or
dividend), then 10 business days thereafter
(or any earlier or later date the Board of
Directors may decide):
(i) Rights owned by the Acquiring Person
or its transferees will automatically
be void; and
(ii) each other Right will automatically
become a right to buy, for the
Purchase Exercise Price, that number
of shares of Common Stock having a
market value of twice the Purchase
Exercise Price.
Exchange Option: If the Flip-in Trigger occurs, the Board
- --------------- may, in lieu of allowing Rights to be
exercised, require each outstanding Right
to be exchanged for one share of Common
Stock, subject to adjustment as set forth
in the Rights Agreement.
"Flip-over" Trigger: After a Flip-in Trigger occurs, the Company
- ------------------- may not consolidate or merge with, or sell
50% or more of its assets or earning power
to, any person, if the Company's Board of
Directors is controlled by the Acquiring
Person, unless proper provision is made so
that each Right would thereafter become a
right to buy, for the Purchase Exercise
Price, that number of shares of common
stock of the other party to the transaction
having a market value of twice the Purchase
Exercise Price.
Redemption: The Rights may be redeemed by the Board, at
- ---------- any time until a Flip-in Trigger has
occurred, at a Redemption Price of $0.01
per Right.
Power to Amend: The Board of Directors may generally amend
- -------------- the Rights Agreement at any time in any
respect not adverse to holders of Rights.
Expiration: The Rights will expire on August 31, 2009,
- ---------- if not terminated earlier.
Full Text: The Rights Agreement has been filed with
- --------- the Securities and Exchange Commission and
is available for review at the SEC's
internet site, addressed at
http:\\www.sec.gov. In addition, the
Company will mail a copy of the Rights
Agreement, without charge, to any
shareholder who makes a request in writing.
2
