SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
July 30, 1999
Date of Report
(Date of Earliest Event Reported)
SOUTH BEACH CONCEPTS, INC.
(Exact Name of Registrant as Specified in its Charter)
5969 Cattleridge Road, Suite 201
Sarasota, Florida 34232
(Address of principal executive offices)
941/377-7225
Registrant's telephone number
WESTFORD ACQUISITION CORPORATION
1504 R Street, N.W.
Washington, D.C. 20009
Former name and former address
Florida 0-24839
(State or other (Commission
jurisdiction of File Number)
incorporation
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
(a) Pursuant to an Agreement and Plan of Merger (the "Merger
Agreement") dated as of April 15, 1999 between Westford Acquisition
Corporation, a Delaware corporation, and South Beach Concepts, Inc.,
a Florida corporation, all the outstanding shares of common stock of
Westford Acquisition Corporation were exchanged for shares of common
stock of South Beach Concepts, Inc. ("South Beach Concepts" or the
"Company") in a transaction in which South Beach Concepts was the
surviving company.
The Merger Agreement was adopted by the unanimous consent of
the Board of Directors of Westford and approved by the unanimous
consent of the shareholders of Westford on April 15, 1999. The
Merger Agreement was adopted by the unanimous consent of the Board
of Directors of South Beach and by the consent of the shareholders
of South Beach on April 15, 1999. The Merger Agreement was effected
on July 30, 1999.
Prior to the merger, Westford had 4,650,000 shares of common
stock outstanding which shares were exchanged on a one-for-one basis
for shares of common stock of South Beach. Prior to the
effectiveness of the merger, South Beach had an aggregate of
10,953,650 shares outstanding held by more than 300 shareholders.
Upon effectiveness of the merger South Beach issued 4,650,000 shares
of its common stock to the holders of the outstanding common stock
of Westford resulting in an aggregate of 15,603,650 shares of common
stock outstanding. Upon effectiveness of the merger, pursuant to
Rule 12g-3(a) of the General Rules and Regulations of the Securities
and Exchange Commission, South Beach became the successor issuer to
Westford Acquisition Corporation with its common stock deemed
registered under Section 12g of the Securities Exchange Act of 1934.
The officers of South Beach Concepts, Inc. are the same as the
former officers of Westford Acquisition Corporation. See
"Management" below. Three of the four directors of South Beach
Concepts, Inc. are the same as the three directors of Westford.
South Beach Concepts has adopted the by-laws of Westford Acquisition
Corporation.
A copy of the Merger Agreement and amendment thereto is filed
as an exhibit to this Form 8-K and is incorporated in its entirety
herein. The foregoing description is modified by such reference.
(b) The following table contains information regarding the
shareholdings of South Beach Concepts' current directors and
executive officers and those persons or entities who beneficially
own more than 5% of its common stock (giving effect to the exercise
of the warrants held by each such person or entity):
Amount of Common Percent of
Stock Beneficially Common Stock
Name Owned (1) Beneficially Owned(2)
Thomas N. Burnham (3) 7,930,085 67.65%
Director, President
5125 Willow Leaf Drive
Sarasota, Florida 34232
Pamela H. Burnham (4) 0 0%
Director, Vice President,
Treasurer
5125 Willow Leaf Drive
Sarasota, Florida 34232
Keith Pratt, Director (5) 102,650 *
4075 Joanne Court
Ann Arbor, Michigan 48103
Michael R. Hicks 15,000 *
217 Balboa Street
Irving, Texas 75062
All directors and 8,047,735 68.13%
executive officers as
a group (4 persons)
South Beach Concepts Plc (6) 4,730,000 29.8%
29 Albermarle Street
London, England W1X 3FA
Texas International
Group, Inc. (7) 860,000 18.3%
5969 Cattleridge Boulevard
Suite 201
Sarasota, Florida 34232
Mosby Investments, Inc.(8) 2,629,333 29.8%
5969 Cattleridge Boulevard
Suite 201
Sarasota, Florida 34232
Eric Wortham 811,562 5.1%
306 Lockmoor
Collinsville, Illinois 62234
* Less than 1% percent
1. Based upon 15,885,290 outstanding shares of common stock
(subsequent to the effectiveness of the merger South Beach has
issued 281,640 shares of its common stock).
2. Assumes exercise of warrants, options or other rights to
purchase securities held by the named shareholder exercisable
within six months of the date hereof.
3. The 7,930,085 shares includes 3,481,562 shares of common stock
which Thomas N. Burnham directly and 4,448,523 of which he may
be deemed to be the beneficial owner or having voting control
including 2,629,333 shares owned by Mosby Investments, Inc.,
860,000 shares owned by Texas International Group, Inc.,
245,787 shares owned by Dallas Investment Group, Inc., 698,415
shares owned by Sarasota Investment Group and 14,988 shares
owned by SBC World Ventures.
The percentage of stock beneficially owned assumes exercise of
warrants to purchase 8,710,000 shares of common stock of which
8,500,000 have an exercise price of $.0001 for an exercise
period of twelve months of which Thomas N. Burnham owns
3,000,000 directly and may be deemed to be the beneficial
owner of the 3,000,000 owned by Mosby Investments, Inc. and
the 2,500,000 owned by Texas International Group, Inc., over
which he has voting control and 210,000 warrants exercisable
at exercise price of $1.25 until December 31, 1999 increasing
to $2.00 until June 30, 2001 per share exercisable for an
exercise period of twelve months from the date of grant thereof.
4. Pamela Burnham is the spouse of Thomas Burnham.
5. Includes 5,000 shares of common stock owned directly and
97,650 shares owned by SBC Pratt Group of which Keith Pratt
may be deemed to be the beneficial shareholder.
6. South Beach Concepts Plc is a public company in the United
Kingdom whose shares are traded on the Alternative Investment
Market of the London Stock Exchange.
7. The percentage of stock beneficially owned includes the
860,000 shares of common stock and warrants to purchase
2,500,000 shares of common stock over which Thomas N. Burnham
has voting control and may be deemed to be the beneficial owner.
8. The percentage of stock beneficially owned includes 2,629,333
shares of common stock and warrants to purchase 3,000,000
shares of common stock of which Thomas N. Burnham may be
deemed to be the beneficial owner.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
(a) The consideration exchanged pursuant to the Exchange
Agreement was negotiated between Westford Acquisition and South
Beach Concepts. On June 15, 1999, Westford Acquisition Corporation
acquired Baja Food Concepts as a wholly owned subsidiary through a
stock-for-stock exchange. A Form 8-K was filed on June 18, 1999
reporting that acquisition. The officers and directors of Baja Food
Concepts are also the primary officers and directors of South Beach
Concepts and the majority shareholder of Baja Food Concepts, Thomas
Burnham, is a principal shareholder of South Beach Concepts.
In evaluating South Beach Concepts as a candidate for the
proposed merger, Westford used criteria such as the value of the
assets of South Beach, its business operations, its business name
and reputation, its compatibility with the business and assets of
Westford's operating subsidiary, Baja Food, and the business
potential of South Beach Concepts. The Registrant determined that
the consideration for the merger was reasonable.
(b) South Beach Concepts intends to continue development of
fast food themed restaurant business and to further franchise
operations of its fast food restaurant concept, incorporating the
themed restaurant of Baja Food, Cisco & Pancho.
BUSINESS
Through its wholly-owned subsidiary, Baja Food Concepts, Inc.,
the Company operates a themed fast food restaurant, "Cisco &
Pancho", located in Sarasota, Florida. Cisco & Pancho specializes
in gourmet burritos, tacos and empanadas served with homemade salsa.
The store colors and design have Mexican accents and blend with
both the South Beach and Pizza World designs making it compatible
for dual and triple concept properties. During peak hours, a Cisco
& Pancho restaurant requires approximately three to five employees.
The Cisco & Pancho restaurant opened in February, 1999, and has not
yet had significant operations. Management anticipates that it will
open additional Cisco & Pancho restaurants and intends to begin
franchise development of Cisco & Pancho restaurants in 1999. Baja
Food Concepts has commenced preparation of documentation required to
franchise the Cisco & Pancho system and anticipates that franchise
development will begin in 1999.
South Beach Concepts, Inc. was incorporated under the laws of
the State of Florida in July 1998. In August 1998, the Company
acquired South Beach Cafe, Inc. and Pizza World International, Inc.,
the United States subsidiaries of South Beach Concepts, Plc, from
that company in exchange for 10,000,000 of its shares of common stock.
Through its subsidiaries, South Beach Concepts develops,
operates and franchises take-out and eat-in restaurants with
specific and consistent themes, logos, and menus (i.e. "chains") and
roasts, produces and markets coffee beans and teas. It has two
theme restaurant chains, Pizza World Gourmet Pizza and South Beach
Cafe. These restaurants are operated by operating subsidiaries of
the Company's subsidiaries or by third party franchisees.
SOUTH BEACH CAFE
South Beach Cafe, Inc., a wholly owned subsidiary of South
Beach Concepts, Inc., owns and operates three restaurants under the
trademark, "South Beach Cafe" in Sarasota, Florida. Two of the
stores are operated under one roof with a company owned Pizza World
(a "Dual Branded Store") and the third operates under one roof with
Pizza World and Cisco & Pancho (a "Triple Branded Store"). Through
its subsidiary, South Beach Cafe franchises South Beach Cafe
restaurants.
Concept and Menu
South Beach Cafes operate as casual sit-down, eat-in cafes
serving premium coffee and espresso drinks, fresh fruit smoothies
and vegetable drinks, bagels, cream cheese spreads, croissants,
gourmet sandwiches, frozen yogurt, soups, salads, fresh pastries and
other baked goods. South Beach Cafes utilize an art deco design and
colors reminiscent of the art deco architecture of South Beach,
Miami, Florida. Some of the cafes also offer Internet access
capability. The ease of preparation of the offered foods results in
a small number of required employees, approximately 3 to 5 in peak
times, and a lower per store overhead.
Franchise Program
South Beach Cafe, through its wholly owned subsidiaries, owns
offers both area development and single store franchising. A
development agreement grants a franchisee the right to establish
multiple South Beach Cafes within a specified geographic area at
specific locations designated in separate franchise agreements
pursuant to a development schedule. A franchise agreement governing
the construction and operation of the first store is executed
concurrently with the development agreement. All store locations
must be approved. Single store franchise agreements are granted to
individuals or entities with demonstrated financial ability for the
establishment and operation of a single store at a specified location.
Currently there are no franchised stores open and operating.
However, the Company has entered into agreements that provide for
the opening of 11 franchised stores. There is no assurance that
these stores will open or if opened that they will be successful.
Franchise Term, Fee and Royalty
The initial term of a franchise agreement is ten years and is
renewable for one additional ten-year term. Franchisees pay a
nonrefundable development fee computed by multiplying the number of
stores to be opened pursuant to the development agreement by $5,000.
As each franchise agreement for each individual store to be opened
is executed, $5,000 is credited toward the initial franchise fee of
$18,500 for that individual store. Franchisees pay a royalty fee of
4% of net sales of the store, which under certain circumstances, may
be increased to 5%.
Designated Suppliers
In order to maintain the uniformity of all South Beach Cafes and to
insure food quality and consistency, franchisees must operate their
stores in accordance with South Beach Concepts' proprietary business
techniques, systems, policies and procedures. Franchisees are
required to follow standards and specifications established by South
Beach Concepts with respect to food products, ingredients,
packaging, advertising, supplies, equipment, computer hardware and
software, fixtures, furnishings and other items used in the
operation of the store. To enable the franchisees to obtain
superior equipment, supplies, food and beverage products that are
not otherwise available to individual franchisees and to benefit
from reduced prices and more efficient and timely deliveries based
on the leverage gained from increased buying power, South Beach
Concepts reserves the right to designate approved suppliers for
specific items required in the operation of a store. Cafe Society
Coffee Co., a subsidiary of South Beach Concepts is a designated
supplier of coffee and related products.
Support and Training
When a franchisee develops a store, South Beach Concepts must first
approve the site, the plan, the construction and equipment
specifications, design specifications and decor and hardware
specifications. The principal operator and/or store managers
receive comprehensive classroom and hands on training at South Beach
Concepts' training facility and at a company owned store. South
Beach Concepts assists the franchisee with the grand opening of the
store and provides ongoing marketing support. Upon opening, South
Beach Concepts provides in-store assistance and continuing systems
support and training.
PIZZA WORLD GOURMET PIZZA
Pizza World International, Inc., a wholly owned subsidiary of South
Beach Concepts, Inc., owns and operates, under the trademark "Pizza
World Gourmet Pizza" and "Pizza World" restaurants (collectively
referred to as "Pizza World") three Pizza World stores in Sarasota,
Florida. Two of the stores are located in Dual Branded Stores with
South Beach Cafe and the third operates in a Triple Branded Store
with South Beach Cafe and Cisco & Pancho. Through its subsidiary
franchises Pizza World stores.
Concept and Menu
Pizza World offers gourmet and traditional pizzas for
carry-out, delivery and, in certain stores, seat-down capacity. The
speciality gourmet pizza menu ranges from the "Bacon Cheeseburger
American" with a mustard glaze to the "Grecian Gourmet" combining
feta cheese, black olives, spinach, green peppers and tomatoes on a
bed of mozzarella with red sauce. The pizzas are made from freshly
baked dough with homemade pizza sauce and a choice of over thirty
toppings. The menu also features calzones, fresh oven baked sub
sandwiches, salads and garlic or cheese breads. The restaurants
have a red and green color scheme and logo. During peak hours, a
Pizza World restaurant requires approximately 6 to 8 employees.
Franchise Program
Pizza World International offers both area development and
single store franchising. A development agreement grants a
franchisee the right to establish multiple Pizza World stores within
a specified geographic area at specific locations designated in
separate franchise agreements pursuant to a development schedule. A
franchise agreement governing the construction and operation of the
first store is executed concurrently with the development agreement.
All store locations must be approved by South Beach Concepts or its
subsidiary. Single store franchise agreements are granted to
individuals or entities with demonstrated financial ability for the
establishment and operation of a single store at a specified location.
Currently there are 13 franchised stores open and operating in
Florida, Illinois and Missouri. There are also development
agreements and franchise agreements that provide for the opening of
17 additional franchised stores. There is no assurance that stores
will open or if opened that they will be successful.
Franchise Term, Fee and Royalty
The initial term of a franchise agreement is ten years and is
renewable for one additional ten-year term. Franchisees pay a
nonrefundable development fee computed by multiplying the number of
stores to be opened pursuant to the development agreement by $5,000.
As each franchise agreement for each individual store to be opened
is executed, $5,000 is credited toward the initial franchise fee of
$18,500 for that individual store. Franchisees pay PWIFC a royalty
fee of 4% of net sales of the store, which under certain
circumstances, may be increased to 5%.
Designated Suppliers
In order to maintain the uniformity of all Pizza World stores
and to insure food quality and consistency, franchisees must operate
their stores in accordance with South Beach Concept's or
subsidiary's proprietary business techniques, systems, policies and
procedures. Franchisees are required to follow standards and
specifications established by South Beach Concepts with respect to
food products, ingredients, packaging, advertising, supplies,
equipment, computer hardware and software, fixtures, furnishings and
other items used in the operation of the store. To enable the
franchisees to obtain superior equipment, supplies, food and
beverage products that are not otherwise available to individual
franchisees and to benefit from reduced prices and more efficient
and timely deliveries based on the leverage gained from increased
buying power, South Beach Concepts reserves the right to designate
approved suppliers for specific items required in the operation of a
store.
Company Support and Training
When a franchisee develops a store, South Beach Concepts or
subsidiary must first approve the site, the plan, the construction
and equipment specifications, design specifications and decor and
hardware specifications. The principal operator and/or store
managers receive comprehensive classroom and hands on training at
South Beach Concept's training facility and at a company owned
store. South Beach Concepts or its subsidiary assists the
franchisee with the grand opening of the store and provides ongoing
marketing support. Upon opening, South Beach Concepts provides
in-store assistance and continuing systems support and training.
CURRENT OPERATIONS COMPANY STORES
South Beach Cafe. The initial two company South Beach Cafes
were opened in Lansing, Michigan, in February, 1995 and June, 1996.
One of these cafes was closed in 1998 when the mall in which it was
located was closed for renovation. Management intends to reopen
such store in a larger 4,200 square foot facility in the new mall as
a "triple-concept" unit combining under one roof and one management
system a South Beach Cafe, Pizza World and Cisco & Pancho restaurant
sharing the same services and staff. With the development of its
larger "triple-concept" store, management determined to close the
other Lansing, Michigan South Beach Cafe.
South Beach Cafe, Inc., through its subsidiary, opened three
company South Beach Cafes in the Sarasota, Florida, area, in May,
1997, February, 1999 and March, 1999. Two of these stores are
dual-branded concept stores (the stores opened in May, 1997 and
March, 1999) offering both the South Beach Cafe and a Pizza World
Gourmet Pizza store sharing services and staff and providing more
extensive variety to customers. The third cafe (opened in February,
1999) was opened as a triple-branded concept store housing the South
Beach Cafe, Pizza World and a Cisco & Pancho facility. Through its
subsidiary, South Beach Cafe Inc. has three Pizza World restaurants
in Sarasota, Florida. Two of these stores are part of dual-concept
units and the third is a part of the triple-concept unit described
above. South Beach Concepts' wholly-owned subsidiary, Baja Food
Concepts, Inc., operating under the name Cisco & Pancho, has opened
one company store which is part of the triple-concept unit located
in Sarasota, Florida described above.
Cafe Society Coffee Company. The Cafe Society Coffee Company is a
Dallas, Texas, wholly-owned subsidiary of the South Beach Concepts
which roasts and packages high-end specialty coffees which are sold
and distributed under its own label and private labels. The Cafe
Society Coffee Company offers a full line of specialty coffees
including varietals, blends, flavored, organic and naturally
flavored coffees as well as specialty teas, gourmet syrups and hot
chocolates. All Cafe Society Coffee Company coffees are produced in
its own roasting facility. Green coffee beans are purchased from
select brokers and roasting, packaging and shipping is completed
in-house. The roasting equipment consists of a 60 kilo Sasa Samiac
roaster and a 12 kilo Sasa Samiac roaster utilizing an air roast
method with a current capacity of approximately 1.2 million pounds
per year. Coffee is packaged for commercial and consumer use.
Trademarks
Through its listed subsidiary, South Beach Concepts owns all the
right, title and interest in and to the following marks, which are
the primary trademarks, service marks, names, logos and symbols used
by it to identify the business and are registered with the United
States Patent and Trademark Office on the principal register:
South Beach Cafe, Inc.: Registration #2,024,465, 12/17/96,
mark: South Beach Cafe and design
Serial #75/359,009, 9/18/96, mark: design
Pizza World Gourmet Pizza:
Registration #2,018,274, 11/7/95, mark:
Pizza World Gourmet Pizza and design
Registration #2,066,993, 6/3/97, mark: Amore Roma
Registration #2,066,994, 6/3/97, mark: Ciao Bella
Registration #2,066,997, 6/3/97, mark: Americana
Registration #2,069,389, 6/10/97, mark: Aloha Makana
Registration #2,069,390, 6/10/97, mark: Taste of
Chicago
Registration #2,069,399, 6/10/97, mark: Le Gardeaux
Cafe Society Coffee Company:
Registration #1,902,906, 7/4/95, mark: Cafe Society
Registration #1,903,188, 7/4/95, mark: Cafe Society
Registration #1,964,097, 3/26/96, mark:
Cafe Society (design)
Registration #1,989,726, 7/30/96, mark:
Cafe Society Coffee Company (design)
Baja Food Concepts, Inc. has filed an application to
register the trademark Cisco & Pancho.
DUAL/TRIPLE BRAND STORES
South Beach Concepts believes that situating two or more
of its theme Restaurants under one roof will attract more
customers and will reduce costs. South Beach Concepts operates
one "Dual-Branded" restaurant (two different theme restaurants
under one roof) consisting of South Beach Cafe and Pizza World
and one "Triple-Branded" Restaurant (three different theme
restaurants under one roof) consisting of South Beach Cafe,
Pizza World, and Cisco & Pancho. The dual and triple brand
restaurants provides for combining the operating systems of the
restaurants and reduces duplication of certain operations.
Because the prime rush hours of each theme restaurant are not
the same, the multi-branding concept allows for better
utilization of the leased premises with less down time,
increases the productivity of the staff which can be crossed
train to reduce the number of employees needed in each
restaurant, and allows for sharing equipment thereby reducing
the total equipment package cost. In addition, customers are
more likely to visit one site offering more than one food option
type.
TRAINING FACILITY
A training facility for all the restaurant concepts is
located next to South Beach Concept's first triple concept store
in Sarasota, Florida. The facility is used to orient and
provide comprehensive training for operators and franchisees in
a classroom setting. Classes focusing on policy and operational
procedures are conducted by South Beach Concepts staff.
Classroom instruction and written materials instruct the
Franchisee in local store marketing, computer operations,
delivery, food preparation, daily management, staff hiring and
training, inventory management and business management. The
proximity to the triple concept company store will allow
trainees not only the opportunity to observe an operating store
"in action", but to get "hands-on" training in that store.
PROPERTY
South Beach Concepts, Inc. maintains its
administrative offices at 5969 Cattleridge Boulevard, Suite 201,
Sarasota, Florida 34232 under a monthly lease of approximately
$4,880 per month for approximately 4,000 square feet.
MANAGEMENT
Name Age Title
Thomas N. Burnham 52 President, Director
Pamela H. Burnham 52 Vice President, Director
Keith Pratt 56 Director
Michael R, Hicks 40 Director
THOMAS N. BURNHAM is the President, director and
shareholder of South Beach Concepts, Inc. and an officer of its
subsidiaries, including Baja Food Concepts, Inc. and South Beach
Cafe, Inc. From April, 1996 until April, 1999, Mr. Burnham was
Chairman and Chief Executive Officer of South Beach Cafe, Plc
(London, England) and from November, 1996 to December, 1998, he
was a director of South Beach Cafe-London, Ltd. Mr. Burnham
also serves a director, president and has voting control of the
following entities: Burnham International Group, Inc., Sarasota
Investment Group, Inc., Dallas Investment Group, Inc.,
International Restaurant Concepts, Inc., London Ventures, LC,
Mosby Investments, Inc., Texas International Group, Inc., The
Northgate Group, L.C., 100 Degrees East, Inc., Thomas N. Burnham
Associates, Inc., and International Franchise Group, Inc.
From October, 1993 to August, 1994, Mr. Burnham was
president and director of Clucker's International Franchise
Corporation, Miami, Florida; from October, 1990 to May, 1993,
Mr. Burnham was president and director of Ho-Lee-Chow, Inc., Ann
Arbor, Michigan. Mr. Burnham served in the following
capacities for Domino's Pizza International, Inc.: Executive
Vice President, December, 1989 to May, 1990; Vice President,
Administration and Development, May, 1989 to May, 1990;
Director, June, 1986 to May, 1990; and General Counsel from
September, 1986 to May, 1990. From September, 1984 to
September, 1986, Mr. Burnham served as outside General Counsel
for Domino's Pizza International, Inc. Mr. Burnham has been the
principal of the law firm of Thomas N. Burnham International Law
Offices from January 1990 to the present. Mr. Burnham received
his Bachelor of Business Administration degree in 1969, a
Masters in Business Administration in 1970 and a Juris Doctor in
1973 from the University of Michigan, Ann Arbor, Michigan. Mr.
Burnham currently serves as Program Director of Franchising and
Entrepreneurism at the University of Dallas and is the founder
and director of the Institute of International Enterpreneurship.
PAMELA H. BURNHAM has served as Vice President, Treasurer
and a director of South Beach Concepts, Inc. since its inception
in July, 1998 and serves as an officer of several of its
subsidiaries. From April, 1996 to April, 1999, Ms. Burnham
served as a director of South Beach Cafe, Plc (London, England).
She also served as a director for South Beach Cafe-London.,
Ltd. from November, 1996 to December, 1998. Ms. Burnham also
serves a director and vice president of the following entities:
Burnham International Group, Inc., Sarasota Investment Group,
Inc., Dallas Investment Group, Inc., International Restaurant
Concepts, Inc., Mosby Investments, Inc., Texas International
Group, Inc., 100 Degrees East, Inc., Thomas N. Burnham
Associates, Inc., and International Franchise Group, Inc.
From October, 1993 to August, 1994, Ms. Burnham was a
Franchise Sales Consultant for Clucker's International Franchise
Corporation, Miami, Florida. From February, 1991 through May,
1993, she was Vice President of Ho-Lee-Chow, Inc., Ann Arbor,
Michigan. Ms. Burnham was President of International Pizza
Ventures, Inc. Toronto, Canada from October, 1989 through
February, 1991. She served as Director of Real Estate for
Domino's Pizza International, Inc. from August, 1989 to May,
1990. Ms. Burnham attended Crowan College in North Carolina
from 1965 to 1967 and University of California at Los Angeles in
1979.
KEITH PRATT serves as a director of South Beach Concepts.
Mr. Pratt was one of the founders of South Beach Cafe, Inc. and
has served as a consultant to it in the areas of restaurant and
office site selection, lease negotiation, store design, software
and implementation since its inception. From 1976 to present,
Mr. Pratt has been a commercial real estate broker with Gary
Lillie & Associates, Inc. located in Ann Arbor, Michigan. Mr.
Pratt also serves as the president of Cafe Development Group,
founded in 1996 a consulting firm that assists in restaurant
site selection, design, equipping and staffing. Mr. Pratt
received his Bachelor of Science in Engineering from the
University of Michigan in 1969.
Michael R. Hicks, M.D., serves as a director of South
Beach Concepts. Dr. Hicks is President of Pinnacle Anesthesia
Consultants, PA, a two hundred-member single specialty medical
practice in Dallas, Texas and is also a practicing
anesthesiologist. In addition, Dr. Hicks is a principal and
officer of Hicks-Rosengarden Investments, a publisher of
regional specialty publications including Avidgolfer. He is
currently a member of the Board of Directors of the Texas
Society of Anesthesiologists. Prior to the formation of
Pinnacle Anesthesia Consultants, PA, Dr. Hicks served as
President of DFW Anesthesia Associates, PA from 1995 until 1996
and as Managing Partner of Anesthesia Consultants of Irving
prior to 1995.
Dr. Hicks received a BA in Chemistry and an MD degree from
West Virginia University in 1981 and 1985 respectively. He
completed a residency in anesthesiology in 1989 at the
University of Texas Southwestern Medical School where he also
served as Chief Resident. Dr. Hicks is currently completing an
MBA at the University of Dallas.
RELATED TRANSACTIONS
Thomas N. Burnham, President and director of South Beach
Concepts is the principal of the law firm of Thomas N. Burnham
International Law Offices and performs legal services for South
Beach Concepts, Inc. and its subsidiaries.
RISK FACTORS
OPERATING LOSS. Revenues from operations to date have not
been sufficient to cover the costs of such operations and the
Company has borrowed funds to maintain its operations. The
Company's ability to develop operations is dependent upon its
ability to sell its franchise stores and to operate its company
store at a profit. If the Company is unable to sell sufficient
franchise stores or to operate its company store at a
sufficiently profitable level, the Company will need to raise
additional capital through the placement of its securities or
from other debt or equity financing. If the Company is not able
to raise such financing or to obtain alternative sources of
funding, management will be required to curtail operations.
There is no assurance that the Company will be able to continue
to operate.
LIMITED OPERATING HISTORY. The Company has a limited
history of operations and to date has not been profitable. The
Company's operations are subject to all the risks inherent in
the establishment of a relatively new business enterprise.
There can be no assurance that future operations will be
profitable. The Company's operations are in part dependent on
the establishment of, and profitability of new restaurants.
Revenues and profits of the Company, if any, will depend upon
various factors, including market acceptance of the Company's
concepts, attractiveness and quality of the menu, restaurant
service, location of the restaurants and general economic
conditions. The growth of the Company will depend on a number
of factors, including the availability of suitable locations,
the negotiation of favorable lease or site acquisition terms,
the identification, training and retention of skilled management
personnel and franchisees, the availability of adequate capital,
general economic and business conditions, and others, some of
which are beyond the control of the Company. There is no
assurance that the Company will achieve its expansion goals.
The failure to achieve such goals would have an adverse impact
on the Company.
DEPENDENCE ON FRANCHISEES. The Company anticipates that
it will realize a portion of its revenues from franchise fees,
including the initial franchise fees and continuing royalty
payments. If franchisees encounter business or operational
difficulties, revenues from royalties and supplies sales would
be adversely affected. Such difficulties would also negatively
impact the Company's ability to sell new franchises.
Consequently, the Company's financial prospects are
significantly related to the success of its franchised stores,
over which it has limited direct operational control. There can
be no assurance that the Company will be able to successfully
attract new franchisees or that franchisees, if any, will be
able to successfully operate stores.
FRANCHISE COMPETITION. The competition to sell
franchises is very intense and the Company will have to compete
against many well-established, better-known and better financed
companies selling franchises. Potential franchisees will
compare the costs and benefits offered by the Company's
franchise program against those offered by other franchise
companies which may have been in business longer and shown
consistent positive economic returns. The market for selling
the franchises is limited and the Company may suffer adverse
consequences from its possible inability to attract new
franchisees.
FRANCHISE REGULATIONS. The Company will be subject to
federal regulation and certain state laws which govern the offer
and sale of franchises. Many state franchise laws impose
substantive requirements on franchise agreements, including
limitations on non-competition provisions and termination or
non-renewal of a franchise. Some states require that certain
franchise offering materials be registered before franchises can
be offered or sold in that state. The failure to obtain or
retain food licenses or approvals to sell franchises could
adversely affect the Company's and its franchisees', if any,
results of operations. The future enactment, adoption or
amendment of laws or regulations, such as establishing basic
franchisee rights, increasing the minimum wage or other costs
associated with employees, could adversely affect the Company's
results of operations. Federal and state franchise laws provide
franchisees, either singly or as a group, the right to bring an
action against the franchisor in regard to actions arising from
the franchise agreement, the franchise operations and other
matters.
EFFECTIVENESS OF FRANCHISE ADVERTISING. The success of
the Company will be substantially dependent on the effectiveness
of the advertising programs and the overall success of
franchises. The Company anticipates it will advertise in
franchise and business opportunity publications and exhibits at
franchise fairs worldwide. However, future success in
attracting franchisees will be dependent not only on the
Company's promotional program but also on the success of its
franchisees' existing restaurants that cannot be guaranteed.
COMPETITION. The competition in the fast food and pizza
industry is intense. There are numerous well-established
competitors, including national, regional and local chains,
possessing substantially greater financial, marketing, personnel
and other resources than the Company. The competition includes
such well-known chains as McDonald's, Burger King, Wendy's,
Domino's Pizza, Pizza Hut, Blimpies, and numerous others. The
Company will also face competition in its dual-concept stores
from such large well-known dual-concept stores as Kentucky Fried
Chicken and Taco Bell.
ISSUANCE OF FUTURE SHARES MAY DILUTE INVESTORS SHARE
VALUE. The Certificate of Incorporation of South Beach
Concepts, Inc. authorizes the issuance of a maximum of
50,000,000 shares of common stock and 10,000,000 shares of
preferred stock. The future issuance of all or part of the
remaining authorized common stock may result in substantial
dilution in the percentage of the Company's common stock held by
the Company's then existing shareholders. Moreover, any common
stock issued in the future may be valued on an arbitrary basis
by the Company. The issuance of the Company's shares for future
services or acquisitions or other corporate actions may have the
effect of diluting the value of the shares held by investors,
and might have an adverse effect on any trading market, should a
trading market develop for the Company's common stock.
POTENTIAL ADVERSE EFFECTS OF AUTHORIZATION OF PREFERRED
STOCK. The Company may, without further action or vote by
shareholders of the Company, designate and issue shares of
preferred stock. The terms of any series of preferred stock,
which may include priority claims to assets and dividends and
special voting rights, could adversely affect the rights of
holders of the common stock and thereby reduce the value of the
common stock. The designation and issuance of preferred stock
favorable to current management or shareholders could make the
possible takeover of the Company or the removal of management of
the Company more difficult and discourage hostile bids for
control of the Company which bids might have provided
shareholders with premiums for their shares.
NO CURRENT TRADING MARKET FOR THE COMPANY'S SECURITIES.
There is currently no established public trading market for the
securities of the Company. No assurance can be given that an
active trading market in the Company's securities will develop
or, if developed, that it will be sustained.
PENNY STOCK REGULATION. Upon commencement of trading in
the Company's stock, if such occurs (of which there can be no
assurance) the Company's common stock may be deemed a penny
stock. Penny stocks generally are equity securities with a
price of less than $5.00 per share other than securities
registered on certain national securities exchanges or quoted on
the Nasdaq Stock Market, provided that current price and volume
information with respect to transactions in such securities is
provided by the exchange or system. The Company's securities
may be subject to "penny stock rules" that impose additional
sales practice requirements on broker-dealers who sell such
securities to persons other than established customers and
accredited investors (generally those with assets in excess of
$1,000,000 or annual income exceeding $200,000 or $300,000
together with their spouse). For transactions covered by these
rules, the broker-dealer must make a special suitability
determination for the purchase of such securities and have
received the purchaser's written consent to the transaction
prior to the purchase. Additionally, for any transaction
involving a penny stock, unless exempt, the "penny stock rules"
require the delivery, prior to the transaction, of a disclosure
schedule prescribed by the Commission relating to the penny
stock market. The broker-dealer also must disclose the
commissions payable to both the broker-dealer and the registered
representative and current quotations for the securities.
Finally, monthly statements must be sent disclosing recent price
information on the limited market in penny stocks.
Consequently, the "penny stock rules" may restrict the ability
of broker-dealers to sell the Company's securities. The
foregoing required penny stock restrictions will not apply to
the Company's securities if such securities maintain a market
price of $5.00 or greater. There can be no assurance that the
price of the Company's securities will reach or maintain such a
level.
COMPUTER SYSTEMS REDESIGNED FOR YEAR 2000. Many
existing computer programs use only two digits to identify a
year in such program's date field. These programs were designed
and developed without consideration of the impact of the change
in the century for which four digits will be required to
accurately report the date. If not corrected, many computer
applications could fail or create erroneous results by or
following the year 2000 (the "Year 2000 problem"). Many of the
computer programs containing such date language problems have
been corrected by the companies or governments operating such
programs. The Company's operations are dependent upon the
timely delivery of supplies which deliveries may be delayed or
canceled because of such Year 2000 problem computer failures.
The Company does not know what steps, if any, have been taken by
any of its suppliers. The Company's operations will be
severally curtailed if one or more of its suppliers were to
suffer Year 2000 problems. Furthermore, it is impossible to
predict if the basic utilities serving the company and franchise
stores will continue uninterrupted. A prolonged disruption in
the service of any utility will prohibit the stores from operating.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Not applicable.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 5. OTHER EVENTS
Not applicable.
ITEM 6. RESIGNATIONS OF DIRECTORS AND EXECUTIVE OFFICERS
Not applicable.
ITEM 7. FINANCIAL STATEMENTS
No financial statements are filed herewith. The
Registrant shall file financial statements by amendment hereto
not later than 60 days after the date that this initial report
on Form 8-K must be filed.
ITEM 8. CHANGE IN FISCAL YEAR
Not applicable.
EXHIBITS
1.1 Agreement and Plan of Merger and amendment thereto between
Westford Acquisition Corporation and South Beach Concepts,
Inc.
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 hereunto duly authorized.
SOUTH BEACH CONCEPTS, INC.
By /s/ Thomas Burnham
Chief Executive Officer
Director
Date: August 12, 1999
