<PAGE> 1
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 of 1934
Date of Report Commission File
(Date of earliest event reported): Number:
APRIL 2, 1996 0-6054
SUMMIT FAMILY RESTAURANTS INC.
(Exact name of registrant as specified in its charter)
DELAWARE 87-0264039
(State or other jurisdiction (IRS employer identification
of incorporation or organization) number)
440 LAWNDALE DRIVE
SALT LAKE CITY, UTAH 84115
(Address of principal executive offices) (Zip Code)
(801) 463-5500
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Page 1 of 4
<PAGE> 2
SUMMIT FAMILY RESTAURANTS INC.
ITEM 5. OTHER EVENTS.
On April 2, 1996, Summit Family Restaurants Inc. (the "Company")
entered into a Second Amendment to an Agreement and Plan of Merger and
Reorganization (the "Merger Agreement") with CKE Restaurants, Inc. ("CKE") (the
"Second Amendment"). The Second Amendment amends the Merger Agreement dated
November 30, 1995, as previously amended January 24, 1996, between the Company
and CKE. The Merger Agreement, as amended, provides for the merger of the
Company with a wholly-owned subsidiary of CKE, with the Company being the
surviving corporation. The execution of the Second Amendment and certain of its
terms were publicly announced on April 2, 1996 in a news release included as
Exhibit 20.1 to this Form 8-K.
On April 4, 1996, CKE purchased 946,714 shares of the Series A
Convertible Preferred Stock (the "Preferred Stock") of the Company from ABS MB
(JB) Limited Partnership ("ABS") for $5.27 per share. The shares purchased by
CKE represent 100% of the Company's issued and outstanding Preferred Stock, and
approximately 16.5% of the Company's total issued and outstanding voting
securities. On April 2, 1996 the Company's Board of Directors specifically
approved the aquisition of the Preferred Stock by CKE as part of the Second
Amendment and also approved a waiver of the Company's right of first refusal to
purchase the Preferred Stock. CKE also acquired ABS' rights under the
Registration Rights Agreement dated October 27, 1993 between the Company and
ABS. The closing of the sale of the Preferred Stock by ABS to CKE was publicly
announced on April 5, 1996 in a news release included as Exhibit 20.2 to this
Form 8-K.
The holder of the Preferred Stock has the right to appoint two members
to the Company's Board of Directors. The two directors appointed by ABS, William
L. Paternotte and Frederick L. Bryant, have resigned from the Company's Board
effective April 4, 1996. At the present time the Company understands that it is
CKE's intention to fill the two vacancies on the Company's Board upon
consummation of the Merger Agreement, as amended.
Page 2 of 4
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
Exhibit No. Description of Exhibit
- ----------- ----------------------
2.1 Second Amendment to Agreement and
Plan of Merger and Reorganization by
and among Summit Family Restaurants
Inc. and CKE Restaurants, Inc. dated
April 2, 1996
20.1 News release dated April 2, 1996:
"Summit Family Restaurants and CKE
Restaurants Announce Second
Amendment to Merger Agreement"
20.2 News release dated April 5, 1996:
"Summit Family Restaurants Announces
CKE Restaurants' Purchase of
Outstanding Preferred Shares"
Page 3 of 4
<PAGE> 4
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.
SUMMIT FAMILY RESTAURANTS INC.
(Registrant)
Date: APRIL 4, 1996 By: /s/ Charlotte L. Miller
------------- -----------------------
Charlotte L. Miller
Senior Vice President and
General Counsel
Page 4 of 4
<PAGE> 5
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
- ------- ----------------------
Ex. 2.1 Second Amendment to Agreement and Plan of Merger and
Reorganization by and among Summit Family Restaurants Inc. and
CKE Restaurants, Inc. dated April 2, 1996
Ex. 20.1 News release dated April 2, 1996: "Summit Family Restaurants
and CKE Restaurants Announce Second Amendment to Merger
Agreement"
Ex. 20.2 News release dated April 5, 1996: "Summit Family Restaurants
Announces CKE Restaurants' Purchase of Outstanding Preferred
Shares"
<PAGE> 1
EXHIBIT 2.1
SECOND AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
AND REORGANIZATION
This Second Amendment, dated as of April 2, 1996 (this "Second
Amendment"), to the Agreement and Plan of Merger and Reorganization, dated as of
November 30, 1995 (the "Original Agreement"), as amended pursuant to the First
Amendment to Agreement and Plan of Reorganization, dated as of January 24, 1996
(the "First Amendment") is by and among Summit Family Restaurants Inc., a
Delaware corporation ("Summit"), and CKE Restaurants, Inc., a Delaware
corporation ("CKE"). Capitalized terms not defined herein have the meanings set
forth in the Original Agreement and the First Amendment. Except as specifically
amended below, all provisions of the Original Agreement and First Amendment
remain in full force and effect.
RECITAL
The respective Boards of Directors of Summit and CKE have
determined to amend the Original Agreement and the First Amendment as set forth
in this Second Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and promises contained herein and for other good and
valuable consideration the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. PURCHASE OF SUMMIT PREFERRED STOCK. On or prior to April 4,
1996, CKE shall purchase all of the shares of Summit Preferred Stock from the
holder thereof at a purchase price of $5.27 per share in cash. CKE hereby agrees
to vote all of such shares of Summit Preferred Stock in favor of the
transactions set forth in the Original Agreement, as amended by the First
Amendment and the Second Amendment.
2. CONVERSION OF SECURITIES (SECTION 2.1). The first paragraph
of Section 2.1 of the Original Agreement and the first paragraph of the
definition of "Merger Consideration" in Section 2.1 of the Original Agreement,
as amended by the First Amendment, are amended to read in full as follows:
At the Effective Time, by virtue of the Merger and without any action
on the part of the parties hereto each share of Summit Common Stock and
Summit Preferred Stock issued and outstanding immediately prior
1
<PAGE> 2
to the Effective Time, other than shares of Summit Common Stock for
which appraisal rights have been exercised pursuant to Section 262 of
the DGCL, and other than shares owned by CKE or its subsidiaries (which
will be cancelled), will be converted into the right to receive the
Merger Consideration.
"Merger Consideration" means, for each share of Summit Common
Stock and Summit Preferred Stock (other than shares owned by CKE or its
subsidiaries, which will be cancelled): (a) $2.63 in cash (without
interest) and (b) a number of shares of CKE Common Stock equal to $2.64
divided by the Adjusted CKE Price.
3. FAIRNESS OPINION (SECTION 6.9): Section 6.9 of the Original
Agreement, as amended by the First Amendment, is hereby modified to read in full
as follows:
Summit shall have received letters from Piper Jaffray Inc. confirming
the opinions rendered to Summit's Board of Directors on or prior to the
date of the Original Agreement, on or prior to the date of the First
Amendment and on or prior to the date of the Second Amendment to the
effect that the terms of the Merger are fair to the holders of Summit
Common Stock from a financial point of view, copies of which will be
delivered to CKE at the Closing.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS. Sections 3.19(i)
and 4.12(i) of the Original Agreement are hereby deleted in their entirety. CKE
acknowledges receipt of the information provided to it regarding the separation
compensation plan and procedures and other matters pursuant to the letter, dated
February 29, 1996, from Summit. CKE and Summit agree that the such information
does not constitute a violation of the Original Agreement, as amended, including
Sections 3.19(vii) and 5.2(a) thereof.
2
<PAGE> 3
5. TERMINATION (SECTION 9.1). Sections 9.1(c)(i)(A) and
9.1(d)(i)(A) are hereby deleted in their entirety. The date May 30, 1996 in
every instance it appears in Section 9.1 in the Original Agreement, as amended
by the First Amendment, is hereby changed to June 30, 1996.
6. ADOPTION OF ORIGINAL AGREEMENT BY MERGER SUB. Summit
Merger, Inc., a Delaware corporation ("Summit Merger"), was recently organized
by CKE for purposes of completing the Merger. Summit Merger, by its execution
and delivery hereof, agrees to be bound by the terms and provisions of the
Original Agreement, as amended, and is hereby made a party to the Original
Agreement. For all purposes of the Original Agreement, all references to "Merger
Sub" shall be deemed to refer to Summit Merger.
3
<PAGE> 4
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment, or have caused this Amendment to be duly executed on their respective
behalf by their respective officers thereunto duly authorized, as of the day and
year first above written.
SUMMIT FAMILY RESTAURANTS INC.
By ____________________________________________
Don M. McComas
President and Chief Executive Officer
By ____________________________________________
Charlotte L. Miller
Senior Vice President &
General Counsel
CKE RESTAURANTS, INC.
By ____________________________________________
By ____________________________________________
SUMMIT MERGER, INC.
By ____________________________________________
By ____________________________________________
<PAGE> 1
EXHIBIT 20.1
NEWS RELEASE
FOR IMMEDIATE RELEASE: Tuesday, April 2, 1996
CONTACT: David E. Pertl
Senior Vice President, CFO
Summit Family Restaurants Inc.
(801) 463-5500
SUMMIT FAMILY RESTAURANTS AND CKE RESTAURANTS ANNOUNCE SECOND
AMENDMENT TO MERGER AGREEMENT
SALT LAKE CITY, UTAH -- Summit Family Restaurants Inc. (NASDAQ: SMFR) and CKE
Restaurants, Inc. (NYSE: CKR) today announced a second amendment to the
previously announced merger agreement.
Under the terms of the amended merger agreement, CKE Restaurants will acquire
all of the outstanding common stock of Summit Family Restaurants for a purchase
price equal to $2.63 per share in cash and .165 shares of CKE common stock
provided that the average CKE common stock price is between $15.00 per share and
$17.00 per share at the closing. If the average CKE common stock price is higher
than $17.00 or lower than $15.00 at the closing, the exchange ratio will be
adjusted accordingly. If the average CKE common stock price is below $13.25 and
CKE elects to not adjust the exchange ratio in favor of Summit, Summit has the
right to terminate the agreement. At the current average CKE common stock price
of approximately $16.00, the total consideration would be $5.27 per share. CKE
Restaurants has also agreed to immediately purchase, for cash, the 946,714
outstanding preferred shares for $5.27 per share, which represents a discount
from the $5.50 liquidation preference, which the preferred shareholder would
otherwise receive in the merger As a result, the common shareholders will
receive a higher value than if the preferred shares were acquired in the merger.
The merger, which is subject to Summit Family Restaurants' shareholder approval,
is expected to close by the end of May 1996.
Commenting on the adjustment to the purchase price, Don McComas, president and
chief executive officer of Summit Family Restaurants said, "Several of the
Company's franchisees are experiencing financial difficulty thereby reducing the
value of the Company's franchise system to CKE. This reduced value was the basis
for the adjustment to the previously agreed upon purchase price. The Board of
Directors of Summit has concluded that the revised merger consideration still
represents the lowest risk and best known alternative for Summit's
shareholders," continued Mr. McComas.
William P. Foley, CKE Restaurants' chairman and chief executive officer, said,
"We remain committed to completing a successful transaction that will benefit
both CKE Restaurants' and Summit Family Restaurants' shareholders."
Summit Family Restaurants operates restaurants under three concepts: 78 Company
and 24 franchised family style JB's Restaurants; 6 Galaxy Diner restaurants; and
16 HomeTown Buffet restaurants. CKE Restaurants, Inc. is the parent of Carl
Karcher Enterprises, Inc., which, along with its franchisees and licensees,
operates 668 Carl's Jr. quick-service restaurants, primarily located in
California, Nevada, Oregon, Arizona, Mexico and the Pacific Rim.
# # #
<PAGE> 1
EXHIBIT 20.2
NEWS RELEASE
FOR IMMEDIATE RELEASE: Friday, April 5, 1996
CONTACT: David E. Pertl
Senior Vice President, CFO
Summit Family Restaurants Inc.
(801) 463-5500
SUMMIT FAMILY RESTAURANTS ANNOUNCES CKE RESTAURANTS'
PURCHASE OF OUTSTANDING PREFERRED SHARES
SALT LAKE CITY, UTAH -- Summit Family Restaurants Inc. (NASDAQ: SMFR) announced
today that CKE Restaurants, Inc. (NYSE: CKR) has completed the previously
announced acquisition of all of its outstanding preferred shares from ABS MB
(JB) Limited Partnership. Concurrently with the sale, Frederick L. Bryant and
William L. Paternotte, the two Summit Board members elected by ABS MB (JB),
resigned from the Summit Board. This purchase gives CKE Restaurants a 16.5%
ownership position in Summit and is the first step in completing the previously
announced merger with Summit. The merger, which is subject to Summit's
stockholder approval, is expected to close by the end of May 1996.
Summit Family Restaurants Inc. has restaurant operations in nine western states,
including 77 Company-operated and 24 franchised JB's Restaurants, 6 Galaxy Diner
restaurants and 16 HomeTown Buffet restaurants.
# # #
