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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended DECEMBER 25, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _________________ to __________________
Commission File No. 0-10717
BAYPORT RESTAURANT GROUP, INC.
(Exact name of issuer in its charter)
FLORIDA 59-1827599
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4000 HOLLYWOOD BLVD., HOLLYWOOD, FLORIDA 33021
(Address of principal executive offices) (Zip Code)
(305) 967-6700
(Issuer's telephone number)
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE EXCHANGE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
NONE NOT APPLICABLE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE EXCHANGE ACT:
COMMON STOCK, $.001 PAR VALUE
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter periods that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. YES[X] NO[ ]
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-K contained in this Form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
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<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT.
The Bylaws of the Company currently provide for a Board of Directors
divided into three classes with staggered terms of three years. As a result,
approximately one-third of the Board is elected each year. The Company's Class
III Directors, David J. Connor and Arthur H. Kaplan, will be considered for
reelection at the 1996 annual meeting and Class I and Class II Directors will
serve until the 1997 and 1998 annual meetings, respectively. See "Contemplated
Merger with Landry's Seafood Restaurants, Inc." in Item 12 below. Vacancies
occurring in any Class may be filled by the Board of Directors to serve for the
remainder of the term of the Class.
The executive officers of the Company are appointed by the Board of
Directors, and serve at the pleasure and under the direction of the Board of
Directors.
BOARD OF DIRECTORS
The following persons presently serve as Directors of the Company:
NAME AGE CLASS POSITION
- - ---- --- ----- --------
David J. Connor 54 III Chairman of the Board and
Chief Executive Officer
William D. Korenbaum 40 II Director and President, Chief
Operating and Financial
Officer and Treasurer
Albert A. Clapps 45 II Director
Arthur H. Kaplan 51 III Director
Aloysius D. Rossi 70 I Director
Martin Rudolph 49 I Director
Thomas Hitchner 44 II Director
Robert Stetson 45 I Director
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<PAGE>
BUSINESS EXPERIENCE
The following are brief biographies of the Company's Directors:
DAVID J. CONNOR became a Director of the Company in November 1991,
Chief Executive Officer of the Company in April 1993, Vice Chairman of the
Company in August 1993 and Chairman in June 1995. Between January 1992 and April
1993, Mr. Connor was a consultant to the Company. From 1977 until November 1992,
Mr. Connor served as president and chief operating officer, and as chief
executive officer beginning in 1986, of Carrols Corporation, a large franchisee
of Burger King Corporation (with more than 170 Burger King Restaurants).
WILLIAM D. KORENBAUM has been a Director of the Company since 1987.
Mr. Korenbaum has served as President and Chief Operating and Financial Officer
(December 1987 to the present); Secretary (June 1991 to June 1993); Treasurer
(January 1991 to the present); Chief Executive Officer (April 1988 to April
1993); Secretary and Treasurer (July 1985 to December 1987); and Vice President
(June 1984 to December 1987). Additionally, from June 1984 until November 1992,
Mr. Korenbaum held the following positions with CryoTech Industries, Inc.
("CII"): president, chief executive officer, chief operating officer and a
director (December 1987 to November 1992); member of the office of the president
(May 1987 to December 1987); and vice president, secretary and treasurer (June
1984 to May 1987).
ALBERT A. CLAPPS became a Director of the Company in January 1992.
Mr. Clapps has been the president, chief executive officer and a director of
A.M.L. Development Corporation, a franchisee of five Burger King Restaurants,
since 1979.
ARTHUR H. KAPLAN became a Director of the Company in November 1991
and served as Chairman of the Company's Board of Directors from January 1992
until June 1995. He was a director of CII from January 1992 until November 1992.
Mr. Kaplan has been a partner of the law firm of Astor, Weiss, Kaplan &
Rosenblum since 1979. Astor, Weiss, Kaplan & Rosenblum performs legal services
from time to time on behalf of the Company, for which it is compensated at its
normal hourly rates. Mr. Kaplan has also been, since 1975, the president of
Ivyridge Investment Corporation, which is engaged in real estate holdings and
manufacturing.
ALOYSIUS D. ROSSI became a Director of the Company in January 1992.
Mr. Rossi has been the president of D.B. Rossi Beverage Company, Inc., a beer
distributor, located in Hazelton, Pennsylvania, since its incorporation in 1968,
and was employed by the predecessors of that company since 1946.
MARTIN RUDOLPH became a Director of the Company in January 1992. Mr.
Rudolph is the managing partner of Rudolph, Palitz, a regional certified public
accounting firm. Mr. Rudolph has been a partner of Rudolph, Palitz since 1977.
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<PAGE>
ROBERT STETSON became a Director of the Company in June 1993. Mr.
Stetson is President-CEO and a director of QSV Properties, Inc., the Managing
General Partner of U.S. Restaurant Properties Master L.P., a New York Stock
Exchange traded property company. From 1992 to 1993, Mr. Stetson managed the
firm Stetson & Associates, investing in and consulting to the restaurant
industry. In that capacity, Mr. Stetson was Vice Chairman and interim Chief
Financial Officer of Bugaboo Creek Steak House Inc., a NASDAQ traded company.
Mr. Stetson continues to serve on the Board of Directors of that company. From
1987 until 1992, Mr. Stetson held senior management positions with subsidiaries
of Grand Metropolitan PLC, including President-Retail Division and Chief
Financial Officer of Burger King Corporation, and Chief Executive Officer of
Pearle Vision. See "Certain Transactions."
THOMAS HITCHNER became a Director of the Company in October 1993.
Mr. Hitchner has been a principal of the investment banking firm of Alex Brown &
Sons Incorporated for more than the last four years and an employee of that firm
for more than the last five years.
BOARD COMMITTEES
The Company's Board of Directors has standing Executive, Audit and
Compensation Committees.
The Executive Committee is comprised of Messrs. Connor, Korenbaum
and Kaplan. The Executive Committee possesses substantially all of the powers of
the Board of Directors and acts as the Board of Directors between Board of
Directors meetings.
The Audit Committee is comprised of Messrs. Rossi, Rudolph and
Stetson. The Audit Committee acts as liaison between the Company and its
independent certified public accountants.
The Compensation Committee is comprised of Messrs. Clapps and
Kaplan. The Compensation Committee reviews compensation arrangements between the
Company and its executive officers and administers the Company's 1985, 1993 and
1995 Stock Option Plans. See "Executive Compensation -- Stock Option Plans."
The Company's Board of Directors does not have a standing nominating
committee.
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<PAGE>
COMPLIANCE WITH SECTION 16(A)
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3(d) under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), during the Company's fiscal year
ended December 25, 1995 and any Forms 5 and amendments thereto furnished to the
Company with respect to its most recent fiscal year, and any written
representations referred to in subparagraph (b)(2)(I) of Item 405 of Regulation
S-K, except as set forth below, no person who at any time during the fiscal year
ended December 25, 1995 was a Director, officer or, to the knowledge of the
Company, a beneficial owner of more than 10% of any class of equity securities
of the Company registered pursuant to Section 12 of the Exchange Act failed to
file on a timely basis, as disclosed in Forms 3, 4 and 5, reports required by
Section 16(a) of the Exchange Act during the fiscal year ended December 25,
1995. The only late filed forms during fiscal 1995 was a Form 4 for
Mr. Hitchner.
EXECUTIVE OFFICERS
NAME AGE POSITION
- - ---- --- --------
David J. Connor 54 Chairman and Chief Executive Officer
William D. Korenbaum 40 President, Chief Operating and Financial
Officer and Treasurer
Dennis Snuszka 43 Executive Vice President-Operations
Ruth Stack 35 Secretary
Anne Catz 45 Vice President-Marketing
Paul Seidman 39 Vice President-Food and Beverage
For biographical information regarding Messrs. Connor and Korenbaum,
see "Board of Directors."
DENNIS SNUSZKA has been Executive Vice President-Operations since
July 1993. Prior thereto, he was Vice President-Operations, from November 1991
to July 1993, and Vice President, Food and Beverage, from August 1990 to
November 1991. Mr. Snuszka joined the Company as Director of Culinary Standards
in February 1989. Prior to joining the Company, Mr. Snuszka was employed for
nine years by Multifoods, a diversified food company based in Minneapolis,
Minnesota, where he served as its manager of culinary standards and purchasing
from October 1987
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through February 1989 and as its director of operations during the last year of
his employment. In these capacities, Mr. Snuszka was directly responsible for
frozen seafood procurement and distribution and supervision of nine full-service
seafood restaurants.
RUTH STACK has served as the Company's Secretary since June 1993.
Since joining the Company in June 1988, she has served as administrative
assistant to the Company's executive management.
ANNE CATZ is the Company's Vice President-Marketing. Ms. Catz
joined the Company in November 1987. Prior to joining the Company, from 1986 to
1987, Ms. Catz was a regional franchise marketing manager for PCR International,
Inc., a large network of computer rental centers, and from 1984 to 1987, was
regional field marketing manager of Bojangles of America, Inc., a fast food
franchise organization.
PAUL SEIDMAN has served as the Company's Vice President-Food
and Beverage since June 1995. Mr. Seidman joined the Company as Director of
Culinary Standards in June 1992. Prior to joining the Company, Mr. Seidman was
employed by La Madeleine, Inc., a Dallas-based company involved in the
establishment of cafes and bakeries, where he served as Corporate Executive
Chef/Product Development Manager.
FAMILY RELATIONSHIPS
There are no family relationships between or among any of the
Directors and executive officers of the Company.
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<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation paid or to be paid
to the following persons for services rendered in all capacities to the Company
during the fiscal years ended December 25, 1995, December 26, 1994 and December
27, 1993: (i) the Company's Chief Executive Officer during the fiscal year ended
December 25, 1995, and (ii) each of the Company's most highly compensated
executive officers whose total salary and bonus exceeded $100,000.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------- ------------ ALL OTHER
NAME YEAR SALARY($) BONUS($) OPTIONS(#) COMPENSATION($)(1)
- - ---- ---- --------- -------- ---------- ------------------
<S> <C> <C> <C> <C> <C>
David Connor 1995 281,667 150,000(3) 500,000 219,384
1994 255,833 65,000 -0- 67,243
1993(2) 187,521 106,875 168,750 22,391
William D. Korenbaum 1995 212,000 150,000(3) 450,000 12,345
1994 204,667 52,000 -0- 21,302
1993 194,583 95,000 131,250 740,205
Dennis Snuszka 1995 124,269 18,000 25,000 5,100
1994 105,000 23,000 -0- 62,888
1993 95,461 20,000 37,500 4,200
<FN>
- - ------------------
(1) All Other Compensation includes participation in group disability and
life insurance programs and the use of an automobile and, as to Messrs.
Korenbaum and Snuszka, the net value of stock options exercised during
1993 and 1995, respectively. As to Mr. Connor, in 1995, includes payment of
$182,024 for the 1995 and 1996 carrying costs of his home in
Syracuse, New York pursuant to his employment agreement.
(2) Includes compensation payable to Mr. Connor as a consultant to the Company
between January 1993 and April 1993.
(3) Signing bonus received pursuant to employment agreement.
</FN>
</TABLE>
There are no other arrangements pursuant to which any Director of
the Company is or was compensated during the Company's last fiscal year for
services as a Director, for committee participation or special assignments.
However, Directors are reimbursed for all reasonable out-of-pocket expenses,
including but not limited to airfare, hotel accommodations, car rentals and
meals incurred by them in connection with conducting business on behalf of the
Company. Further, Directors have been granted options to purchase shares of the
Company's Common Stock for serving on the Board of Directors. See "Executive
Compensation -- Stock Option Plans" for a description of the mandatory annual
option grants to non-employee Directors under the 1995 Stock Option Plan.
Section 162(m) of the Internal Revenue Code generally disallows an
income tax deduction to public companies for compensation over $1,000,000 paid
in a year to any one of the chief
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executive officer or the four most highly compensated other executive officers,
to the extent that this compensation is not "performance based" within the
meaning of Section 162(m). As a result of this limitation, there can be no
assurance that all of the compensation paid to the Company's executive officers
in the future will be deductible.
OPTION GRANTS TO EXECUTIVE OFFICERS DURING 1995
The following table sets forth information concerning options
granted during the fiscal year ended December 25, 1995 to those persons
named in the preceding Summary Compensation Table:
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT STOCK PRICE
APPRECIATION FOR
% OF OPTION TERM
SHARES UNDERLYING TOTAL EXERCISE EXPIRATION ----------------------
NAME OPTIONS GRANTED OPTIONS PRICE DATE 5% 10%
- - ---- ----------------- ----- ----- ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
David Connor 500,000 37% $4.00 12/31/99 431,013 928,200
William D. Korenbaum 450,000 33% $4.00 12/31/99 387,911 835,380
Dennis Snuszka 25,000 2% $4.25 12/2/2000 29,355 64,867
</TABLE>
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
The following table sets forth certain information concerning the
value of unexercised stock options at the end of the 1995 fiscal year for the
individual executive officers named in the Summary Compensation Table:
<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF IN-THE-MONEY
UNEXERCISED OPTIONS OPTIONS AT
SHARES ACQUIRED AT FY-END (#) FY-END($)
NAME ON EXERCISE(#) VALUE REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(1)
- - ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
David Connor 0 - 231,250/422,500 - /14,400
William D. Korenbaum 0 - 221,250/360,000 - / -
Dennis Snuszka 0 - 25,000/45,000 - / -
<FN>
- - ------------------
(1) Computed based upon the difference between the average of the bid and asked
price of the Common Stock at April 19, 1996 ($4.00 per share) and the exercise
price. No value has been assigned to options which are not in-the-money.
</FN>
</TABLE>
EMPLOYMENT AGREEMENTS
Effective April 1, 1995, the Company entered into new employment
agreements with Messrs. Conner and Korenbaum. See the Company's Proxy Statement
from its 1995 Annual Meeting of Shareholders, dated April 19, 1995 for
information regarding the terms of these employment agreements.
The Company has an employment agreement with Mr. Snuszka which
expires June 30, 1997. As compensation for his services to the Company, Mr.
Snuszka receives (a) an annual salary of $100,000 plus (b) a bonus based upon
performance, in the maximum amount of up to 37 percent of his annual salary.
Further, during 1993, Mr. Snuszka was granted options to purchase 37,500 shares
of the Company's Common Stock at an exercise price of $5.87 per share (the fair
market value on the date of grant). Previously, in 1991, Mr. Snuszka received
options to acquire 43,750 shares of the Company's Common Stock at $1.00 per
share (the fair market value on the date of grant).
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<PAGE>
STOCK OPTION PLANS
The Company has three stock option plans, the 1993 Plan, the 1985
Plan and the 1995 Plan (collectively, the "Plans").
Pursuant to the 1993 Plan, options to acquire a maximum of 200,000
shares of Common Stock may be granted by the Company to its officers and other
key employees. Options to purchase 163,750 shares of Common Stock at exercise
prices ranging between $3.00 and $5.87 per share have been granted under the
1993 Plan and are presently outstanding. All options were granted at the fair
market value of the Common Stock of the date of grant. Of the options granted
under the 1993 Plan, 53,750 are presently exercisable. All options granted to
date under the 1993 Plan are "incentive stock options" as defined under Section
422A of the Internal Revenue Code of 1986 (the "Code"). No further options are
reserved for future issuance under the 1993 Plan.
Pursuant to the 1985 Plan, options to purchase 57,500 shares are
presently outstanding, at exercise prices ranging from $1.52 to $5.76 (the fair
market value on the dates of grant). All options granted under the 1985 Plan are
"incentive stock options" under Section 422A of the Code. Of the options
presently outstanding under the 1985 Plan, options to purchase 34,250 shares are
presently vested. No further options are reserved for future grants of options
under the 1985 Plan.
Pursuant to the 1995 Plan, options to purchase 437,500 shares are
outstanding, at exercise prices ranging from $3.13 to $4.50 (the fair market
value on the date of grant). Of the options presently outstanding under the 1995
Plan, options to purchase 51,500 shares are presently vested. There remain
386,000 shares of Common Stock reserved for issuance upon the exercise of future
options granted under the 1995 Plan. Options may be granted under the 1995 Plan
to directors and executive officers of the Company.
Each of the Plans is administered by the Compensation Committee of
the Board of Directors. The Compensation Committee determines which employees
will receive options, the number of options to be granted to such employees and
the exercise price and term of options granted. The Compensation Committee also
interprets the provisions of the Plans and makes all other determinations that
it may deem necessary or advisable for the administration thereof. Directors who
are members of the Compensation Committee may not receive options under either
the 1985 Plan or the 1993 Plan for as long as they serve on the Compensation
Committee and may not have received options under either plan during the twelve
months immediately preceding their nomination to the Compensation Committee.
Generally, options granted under the Plans may remain outstanding
and may be exercised only so long as the person to whom they were granted
remains employed by the Company or a subsidiary thereof, subject to certain
exceptions in the case of retirement, involuntary retirement, total and
permanent disability and death of an employee.
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Incentive stock options granted under the Plans are subject to the
restriction that the aggregate fair market value (determined as of the date of
grant) of stock for which an employee may be granted stock options in any
calendar year is limited to $100,000 plus the amount of any "unused limit
carryover." The term "unused limit carryover" is defined under applicable
provisions of the Internal Revenue Code as being equal to one-half of the
excess, if any, for each calendar year of $100,000 over the fair market value of
stock for which options were granted to the employee in that year, up to a
maximum carryover period of three years. Incentive stock options granted in any
year will first be applied for this purpose against that year's $100,000 limit
and carryovers may only be utilized in the order in which they arose.
Each Plan provides for appropriate adjustments in the number and
type of shares covered by such Plan and options granted thereunder in the event
of any reorganization, merger, recapitalization or certain other transactions
involving the Company.
Options are granted annually to each director of the Company who is
not otherwise an employee of the Company, under the 1995 Plan. Commencing on
April 1, 1995, and on each year thereafter on the same date, each non-employee
Director receives options to purchase 5,000 shares of Common Stock. Such options
vest immediately on the date of their grant. In addition, each Director that
serves on a committee of the Board of Directors receives options to purchase
2,500 shares of Common Stock, and each Director that chairs a committee of the
Board of Directors receives options to purchase 1,500 shares of Common Stock.
Such options also vest immediately on the date of their grant. These options are
intended to compensate such non-employee Directors for their services during the
prior fiscal year. The exercise price of these options is the last sale price of
the Common Stock on the date of grant.
OPTIONS NOT ISSUED PURSUANT TO PLANS
The Company has granted options to key employees and directors
outside of the Plans. The exercise price for all options granted to date is at
least equal to the fair market value of the underlying Common Stock on the date
of grant. Options granted are generally exercisable over a three to seven year
period. At this date, non-plan stock options to purchase 1,452,750 shares are
outstanding, at exercise prices ranging from $1.36 per share to $5.87 per share
(the fair market value on the date of grant). Of these outstanding options,
options to purchase 565,750 shares are presently exercisable.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of March 2,
1996 with respect to any person (including any "group" as that term is used in
Item 403 of Regulation S-K) who is known to the Company to be the beneficial
owner of more than 5% of the Common Stock and Common Equivalent Shares (taken as
a single voting group), with respect to each of the Company's Directors
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and each of the Company's executive officers included in the Summary
Compensation Table, and with respect to the Company's Directors and executive
officers as a group. Unless otherwise indicated, the respective holders of
shares reflected in the table have sole voting and investment power with respect
thereto and own their respective shares directly. As of March 2, 1996, there
were issued and outstanding 9,409,923 shares of Common Stock of the Company and
2,673,805 Common Equivalent Shares (aggregating 668,451 shares). Except as
noted, the address of each beneficial owner is c/o the Company.
AMOUNT OF
NAME OF AND NATURE OF APPROXIMATE
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS(1)
- - ---------------- -------------------- -------------------
Albert A. Clapps 151,533 (2) 1.5
David J. Connor 412,311 (3) 4.0
Arthur H. Kaplan 538,861 (4) 5.4
William D. Korenbaum 447,000 (5) 4.4
Aloysius D. Rossi 124,842 (6) 1.2
Martin Rudolph 66,642 (7) *
Robert Stetson 33,625 (8) *
Thomas R. Hitchner 25,980 (9) *
Dennis Snuszka 104,250 (10) 1.0
Officers and Directors
of the Company as a Group
(11 Persons) 1,962,185 (11) 18.1
Robert Fleming, Inc.
1285 Avenue of the Americas
16th Floor
New York, N.Y. 10009 835,399 (12) 8.3
- - -----------------------------
* Less than 1%.
(1) Based on 10,078,374 shares outstanding, plus, as to each person, the
exercise of their currently exercisable options and options becoming
exercisable within the next 60 days.
(2) Includes 24,500 shares which may be acquired on the exercise of
currently exercisable options. Does not include 3,000 shares which may
be acquired upon the exercise of options which are not yet exercisable or
to become exercisable within 60 days after the date hereof.
(3) Includes 253,750 shares which may be acquired upon the exercise of
currently exercisable options. Does not include 400,000 shares which may
be acquired upon the exercise of options which are not yet exercisable or
to become exercisable within 60 days after the date hereof.
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(4) Includes shares beneficially owned by the Hirsh Family Trust (the "Trust").
Mr. Kaplan serves as one of three trustees of the Trust and, as such, under
federal securities laws shares the power to vote and dispose of securities
held by the Trust. Mr. Kaplan otherwise disclaims beneficial ownership over
securities owned by the Trust. Includes 58,000 shares which may be acquired
on the exercise of currently exercisable options. Does not include 22,500
shares which may be acquired upon the exercise of options which are not yet
exercisable or to become exercisable within 60 days after the date hereof.
(5) Includes 241,250 shares which may be acquired upon the exercise of
currently exercisable options. Does not include 360,000 shares which may be
acquired upon the exercise of options which are not yet exercisable or to
become exercisable within 60 days after the date hereof.
(6) Includes 24,500 shares which may be acquired upon the exercise of
currently exercisable options or options which will become exercisable
within the next 60 days. Does not include 3,000 shares which may be
acquired upon the exercise of options which are not yet exercisable or to
become exercisable within 60 days after the date hereof.
(7) Includes 27,500 shares which may be acquired upon the exercise of
currently exercisable options or options which will become exercisable
within the next 60 days. Does not include 3,000 shares which may be
acquired upon the exercise of options which are not yet exercisable or to
become exercisable within 60 days after the date hereof.
(8) Includes 18,000 shares which may be acquired upon the exercise of currently
exercisable options or options which will become exercisable within the
next 60 days. Does not include 4,500 shares which may be acquired upon
the exercise of options which are not yet exercisable or to become
exercisable within 60 days after the date hereof.
(9) Includes 13,000 shares which may be acquired upon the exercise of currently
exercisable options or options which will become exercisable within the
next 60 days. Does not include 4,500 shares which may be acquired upon
exercise of options which are not yet exercisable or to become exercisable
within 60 days after the date hereof.
(10) Includes 25,000 shares which may be acquired upon the exercise of
currently exercisable options. Does not include 45,000 shares which may be
acquired upon exercise of options which are not yet exercisable or to
become exercisable within 60 days after the date hereof.
(11) See Notes 1 through 10.
(12) Information obtained from the Schedule 13G filed on February 14, 1996.
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CONTEMPLATED MERGER WITH LANDRY'S SEAFOOD RESTAURANTS, INC.
On April 18, 1996, the Company entered into a merger agreement (the
"Merger Agreement") with Landry's Seafood Restaurants, Inc., a Delaware
corporation ("Landry's"), pursuant to which Landry's will issue .2105 shares of
its common stock, $.01 par value per share ("Landry's Common Stock"), for each
share of the Company's outstanding Common Stock (the "Exchange Ratio") (the
"Merger"). The Exchange Ratio is subject to change if Landry's Common Stock on
the NASDAQ-National Market System exceeds $22 per share or falls below $15 per
share and under certain other circumstances. Additionally, shares of the
Company's outstanding Series B Convertible preferred stock, $.01 par value per
share, will be converted into shares of a newly created Landry's preferred
stock, $.01 par value per share, on the same terms and at the same Exchange
Ratio as the respective shares of common stock.
The closing of the Merger is subject to the approval of the
shareholders of the Company, the expiration of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act and other
conditions set forth in the Merger Agreement.
Simultaneously with the execution of the Merger Agreement, Landry's
and the Company entered into a funding agreement, whereby Landry's agreed to
provide $11 million of funding to the Company to pay construction costs relating
to the Company's restaurants which are currently under development.
Further information regarding the terms of the agreements described
above will be contained in a Current Report on Form 8-K to be filed by the
Company on or before May 3, 1996.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS WITH MESSRS. CLAPPS AND ROSSI
Fast Food Properties II ("FFP") is the owner of the facilities
housing the Company's Miami restaurant, including the fixtures therein. FFP
sub-leases the land and leases the facilities and fixtures to the Company at an
annual rental of $220,000, plus 8.5% of annual sales of the Miami restaurant in
excess of $3,900,000. The Company was the direct lessee under the ground lease
until it assigned its interests in the ground lease to FFP in January 1992.
During the first quarter of 1996 and for the 1995 fiscal year, the rent paid or
payable by the Company under the FFP Lease was approximately $55,108 and
$220,434, respectively. Messrs. Clapps and Rossi are among the limited
partners of FFP. The lease on the facilities expires in 2017.
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The Company believes that its arrangement with FFP is on terms no
less favorable to the Company than could have been obtained from unaffiliated
third parties.
LOANS TO MESSRS. KORENBAUM AND CONNOR
Mr. Korenbaum owes approximately $297,036 to the Company which he
borrowed pursuant to the provisions of his employment agreement with the Company
(to exercise certain stock options). This loan is evidenced by two promissory
notes, both of which mature on June 30, 1997. These notes bear interest at a
rate of 7% per annum.
Mr. Connor owes approximately $179,000 to the Company. These loans
are evidenced by (i) a $125,000 principal amount promissory note which matures
on April 11, 1998 and bears interest at a rate of prime plus 1/2% per annum; and
(ii) a $53,928 principal amount promissory note which matures on April 10, 1997
and bears interest at a rate of 7% per annum.
TRANSACTIONS WITH U.S. RESTAURANT PROPERTIES MASTER L.P.
U.S. Restaurant Properties Master L.P. ("U.S. Restaurant") is the
owner of the facilities housing the Company's Jupiter, Florida restaurant.
On January 1, 1996, the Company began paying rent of $30,000 per month on
such facility. Mr. Stetson is the President-CEO and a director of QSV
Properties, Inc., the managing general partner of U.S. Restaurant.
The Company believes that the arrangement with U.S. Restaurant is
on terms no less favorable to the Company than could have been obtained from
unaffiliated third parties.
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<PAGE>
PERFORMANCE GRAPH
The following graph compares the total return on the Company's
Common Stock with the cumulative total return on the Nasdaq Stock Market (US
Companies) Index and the Standard & Poors Restaurant Index for the last five
years, based on an investment of $100 beginning December 1990.
[INSERT "GRAPH" HERE]
- - --------------------------------------------------------------------------------
DEC-90 DEC-91 DEC-92 DEC-93 DEC-94 DEC-95
- - --------------------------------------------------------------------------------
Bayport $100 114 429 571 343 464
- - --------------------------------------------------------------------------------
Nasdaq Stock $100 161 187 214 210 297
Market (US
Companies)
Index
- - --------------------------------------------------------------------------------
S & P Restaurant $100 135 173 202 201 302
Index
- - --------------------------------------------------------------------------------
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<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, Bayport Restaurant Group, Inc. has duly caused
this report to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Miami, Florida on the 23 day April, 1996.
BAYPORT RESTAURANT GROUP, INC.
By: /s/ DAVID J. CONNOR
----------------------------------------
David J. Connor, Chief Executive Officer
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