SCHEDULE 14A - INFORMATION REQUIRED IN PROXY STATEMENT
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.-14a-11(c)
or Section 240.14a-12
HUDSON'S GRILL OF AMERICA, INC.
(Name of Registrant as Specified in its Charter)
HUDSON'S GRILL OF AMERICA, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ X ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-
6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies: N/A
(2) Aggregate number of securities to which transaction
applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is
calculated and state how it was determined.
[ ] Check box if any part of the fee is offset as
provided by Exchange Act Rule 0-11(a)(2) and
identify the filing for which the offsetting fee
was paid previously. Identify the previous filing
by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.
(3) Filing Party:
(4) Date Filed:
HUDSON'S GRILL OF AMERICA, INC.
16970 Dallas Parkway
Suite 402
Dallas, Texas 75248
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The Annual Meeting of Shareholders of HUDSON'S GRILL OF
AMERICA, INC. (the "Company"), will be held at the Hudson's
Grill restaurant located at 708 Grapevine Highway, Hurst,
Texas 76054, on May 27, 1997, at 10:00 a.m. to act upon the
following proposals:
1. To elect three (3) directors;
2. To ratify the selection of independent auditors;
3. To vote upon a proposal to amend article III of the
Articles of Incorporation to authorize the issuance of
up to 5,000,000 shares of preferred stock, with rights
to be determined by the directors for each series of
preferred stock that is issued; and
4. To consider such other business as may properly come
before the meeting and any adjournments or
postponements thereof.
Details relating to the above matters are set forth in
the attached Proxy Statement. Your management is not aware
of any other matters to come before the meeting. The Board
of Directors has fixed the close of business on April 18,
1997, as the record date for shareholders entitled to notice
of and to vote at the Annual Meeting.
You are urged to fill in, date, sign and promptly
return the Proxy in the enclosed addressed envelope to which
no postage need be affixed if mailed in the United States.
If you do not attend the Annual Meeting, you may supersede
your executed Proxy prior to voting by filing a Proxy
bearing a later date, by filing a written revocation of the
Proxy or by attending the meeting and voting in person. In
order to be valid, the enclosed Proxy (or any new proxy or
proxy revocation) must be received by the Secretary not
later than 10:00 a.m., May 27, 1997.
IF YOU DO NOT PLAN TO ATTEND THE MEETING, YOU ARE URGED
TO DATE, SIGN AND RETURN THE ENCLOSED PROXY WITHOUT DELAY. A
BUSINESS REPLY ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
Mitzy Ferguson
Secretary
Dallas, Texas
April 25, 1997
PROXY STATEMENT
HUDSON'S GRILL OF AMERICA, INC.
16970 Dallas Parkway
Suite 402
Dallas, Texas 75248
GENERAL INFORMATION
The enclosed Proxy is solicited by the Board of
Directors (the "Board") of HUDSON'S GRILL OF AMERICA, INC.
(the "Company").
This Proxy Statement is furnished in connection with
the solicitation of the Proxies by the Company to be voted
at its Annual Meeting of Shareholders to be held May 27,
1997, and at any adjournment and postponement thereof. The
Annual Meeting is to be held at 10:00 a.m. at the Hudson's
Grill restaurant at 708 Grapevine Highway, Hurst, Texas
76054.
A person giving the Proxy may revoke it at any time
prior to the exercise thereof by giving written notice to
the Secretary of the Company, attending the meeting and
voting in person, or filing a duly executed Proxy bearing a
later date with the Secretary. The mailing to shareholders
of this Proxy Statement and the enclosed form of Proxy will
commence on or about April 28, 1997.
All of the expenses involved in preparing, assembling
and mailing this Proxy Statement and the material enclosed
herewith, will be paid by the Company. Officers and
employees of the Company may communicate with shareholders
personally or by mail, telegraph, telephone or otherwise,
for the purpose of soliciting such Proxies, but in such
event no additional compensation will be paid to any such
persons for such solicitation. Brokerage houses, nominees,
fiduciaries and other custodians will be requested to
forward soliciting materials to the beneficial owners of
shares, in which case they will be reimbursed for their
expenses.
Shares represented by valid Proxies will be voted in
accordance with the instructions indicated thereon. Unless
otherwise directed, votes will be cast for the election of
directors herewith named, and for the ratification of the
Company's selection of Hein + Associates, LLP, as
independent auditors for the Company.
VOTING SHARES
Shareholders of record as of the close of business on
April 18, 1997, will be entitled to vote at the Annual
Meeting and at any adjournments thereof. At such date there
were Six Million, Fifty-Six Thousand, Nine Hundred Eighty
Six (6,056,986) shares of Common Stock. Each shareholder of
record is entitled to one (1) vote for each share of stock
owned, except that shareholders may have cumulative voting
rights with respect to the election of directors. See
"Cumulative Voting."
CUMULATIVE VOTING
Pursuant to California law, no shareholder may cumulate
votes unless the candidate's or candidates' name(s) for
which such votes are to be cast have been placed in
nomination prior to the voting and a shareholder who is
present in person at the Annual Meeting has given notice at
the Annual Meeting and prior to voting of the shareholder's
intention to cumulate the shareholder's votes. If any
shareholder has given such notice, all shareholders may
cumulate their votes for candidates in nomination.
Management does not, at this time, intend to give such
notice nor to cumulate the votes it may hold pursuant to the
proxies solicited hereby, unless the required notice by a
shareholder is given in proper form at the Annual Meeting,
in which instance management intends to cumulatively vote
all the proxies held by it in favor of the nominees for
office as set forth herein in such a way as to maximize the
possibility that the nominees will be elected.
In the event cumulative voting shall be utilized, each
shareholder may give one candidate a number of votes equal
to the number of directors to be elected (three) multiplied
by the number of votes to which the shareholder's shares are
entitled, or distribute the shareholder's votes on the same
principle among as many candidates as the shareholder
desires. The three (3) candidates receiving the highest
number of votes are elected.
COMMITTEES OF THE BOARD
The Board held two meetings during fiscal 1996. Each
incumbent director during the fiscal year ended December 29,
1996, attended more than seventy-five percent (75%) of all
meetings of the Board during the time he was a member and of
the Committees of which he was a member.
The Board has an Audit Committee composed of two
members of the Board. The members of this committee are
appointed by the Board to serve until their successors are
appointed.
The Audit Committee was composed of Directors D. Marion
Wood and Thomas A. Sacco. This committee supervises and
reviews the fiscal and accounting procedures and practices
of the Company, reviews the audit and financial statements
with the Company's independent accountants, and reports its
finding and recommendations to the Board for appropriate
action. The Committee met one time during the fiscal year
ended December 29, 1996.
The Board does not have a Nominating Committee, and it
does not have a Compensation Committee. Nominees may be
recommended to the Board in writing by any shareholder.
Compensation matters are considered by the whole Board of
Directors.
Each of the nominees has consented to be named herein
and to serve if elected. However, if any nominee at the time
of election is unable or unwilling to serve as a director,
or is otherwise unavailable for election, the shares
represented by proxies will be voted for the election of
such other person as the Board may designate or, in the
absence of such designation, for a nominee selected by the
persons named in the enclosed form of Proxy, or, if there is
no qualified nominee willing to serve, the position will be
left vacant.
Certain information concerning the director nominees is
set forth below:
Name Age Position
DAVID L. OSBORN 49 Chairman of the Board,
President & Chief
Executive Officer
THOMAS A. SACCO 43 Senior Vice President
David L. Osborn was elected as a Director in May 1990.
He was elected Chairman of the Board, President and Chief
Executive Officer in August 1993. Mr. Osborn is the Chief
Executive Officer of Southpoint Management Corporation,
which owns and operates restaurants, and is Chief Executive
Officer of Famous Bars, Grills & Cafes of America, Inc.,
which is a franchisee of Hudson's Grill. He is also a
partner in D.A.C. Associates, which is a franchisee of
Hudson's Grill, too.
Thomas A. Sacco was elected Senior Vice President of
the Company in May 1995. He is also a Vice President and a
director of Dalms, Inc., a provider of consulting services
to the Company. In addition, he currently serves as
Chairman of the Board of Directors of Triangle Food Service
Corporation, which operates 11 cafeterias and is based in
Dallas, Texas.
As of the date of this proxy solicitation, the Company
has three directorships to elect, but only two nominees. It
does not have a third nominee for director. The Company
will continue to search for a third director to serve on the
Board, who preferably is experienced in the restaurant
industry. Because the Company does not currently pay its
directors and at certain times much time and energy are
required of a director, the Company is encountering some
difficulty in locating a qualified director.
If the Company is able to designate a satisfactory
nominee before the annual shareholder meeting, the shares
represented by proxies will be voted for the election of
such nominee at the time of election, unless the proxy
reflects that a vote for another person has been made. In
the absence of such designation by the Company, the shares
represented by proxies will be voted for a nominee selected
by the persons named in the enclosed form of Proxy, or, if
there is no qualified nominee willing to serve, the position
will be left vacant.
No director currently receives any direct compensation
as a director, except for reimbursement of expenses. Mr.
Sacco is the principal owner of Dalms, which the Company has
paid $158,329.41 for consulting work (mostly performed by
Mr. Sacco), and travel and related expenses (mostly incurred
by Mr. Sacco).
All directors are elected for a term of one (1) year
and serve until their successors have been duly elected and
qualified.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth certain information with
respect to the shares of Common Stock beneficially owned,
directly or indirectly, by (i) persons owning, to the
Company's knowledge, five percent (5%) or more of the
outstanding shares of Common Stock, (ii) each director of
the Company, and (iii) all directors and executive officers
of the Company as a group, in each case as of December 29,
1996.
Number of Percentage of
Shares Total
Beneficially Shares
Name and Address Owned Outstanding
Directors/Officers:
DAVID L. OSBORN 1,867,417 (1) 30.8%
16970 Dallas Parkway
Suite 402
Dallas, TX 75248
THOMAS A. SACCO 2,000 (2) 0.0%
16970 Dallas Parkway
Suite 402
Dallas, Texas 75248
MITZY FERGUSON 220 0.0%
16970 Dallas Parkway
Suite 402
Dallas, Texas 75248
JANE TAYLOR 0 0.0%
16970 Dallas Parkway
Suite 402
Dallas, Texas 75248
All directors and executive
officers as a group
(4 persons) 1,869,637 30.9%
Others Owning 5% or More
Of the Company's Common Stock:
ANTHONY B. DUNCAN 1,044,311 (1) 17.2%
10732 Alta Lomo
El Paso, TX 79935
CLIFFORD J. OSBORN 745,618 (1) 12.3%
5581 East Finisterra Drive
Tucson, Arizona 85715
D. MARION WOOD 602,846 (1) 10.0%
16970 Dallas Parkway
Suite 500
Dallas, TX 75248
ROY J. MILLENDER, JR. 500,000 (1) 8.3%
129 Calle Bello
Santa Barbara, CA 93108
CHARLES L. BOPPELL 495,556 (1) 8.1%
1010 Hot Springs Road
Santa Barbara, CA 93108
(1) Shared voting and investment power is held for these
shares.
(2) Mr. Sacco received options to purchase 400,000 shares
of the Company's stock in May 1995. On May 1, 1995, an
option to purchase 100,000 of these shares vested; on May 1,
1996, an option to purchase another 100,000 of these shares
also vested; the remaining options to purchase 200,000
shares vest in two equal increments during the next two
years, provided that Mr. Sacco is providing full time
consulting services to the Company on May 1st of each of
these next two years. As of December 29, 1996, Mr. Sacco
owned 2,000 shares of the Company's stock. These shares
were purchased for various relatives of Mr. Sacco who are
minors. On January 8, 1997, he gifted 1,700 shares of his
stock to various custodial accounts controlled by him for
the benefit of his relatives.
In August 1993, David L. Osborn purchased control of
the Company from Roy J. Millender, Jr. Mr. Osborn bought
2,679,000 shares of common stock from Mr. Millender for $1
(paid by Mr. Osborn without any financing) and Mr. Osborn's
efforts to revitalize and reorganize the Company. Prior to
this purchase, Mr. Osborn beneficially owned, either
directly, indirectly or through a voting trust, 1,398,652
shares of stock, of which 913,235 shares were in a voting
trust that terminated May 4, 1994. On August 28, 1995, Mr.
Osborn distributed 1,297,000 shares to certain parties to
whom he had promised shares without receiving any monetary
consideration for the transfer. D. Marion Wood received
505,000 shares from Mr. Osborn; Clifford J. Osborn received
200,000 shares; and Anthony B. Duncan received 592,000
shares. As of December 29, 1996, Mr. Osborn was the
beneficial owner of 1,867,417 shares of stock, which is
30.8% of the Company's outstanding shares. Mr. Osborn
directly owns 1,439,856 shares of stock, which is 23.8% of
the Company's outstanding shares.
Effective January 27, 1994, the Company, as part of an
agreement to reduce its secured debt, agreed with Travis
Bryant, its largest creditor, to grant Mr. Bryant a stock
warrant for four (4) million shares exercisable at a price
of one-sixteenth (1/16th) of a dollar for a period of ten
(10) years. In exchange, Mr. Bryant forgave most of the
Company's secured debt owed to him. If Mr. Bryant exercises
a substantial portion of his stock warrant, he could become
the Company's largest shareholder; in addition, Mr. Osborn's
control of the Company would be greatly reduced.
REMUNERATION AND RELATED INFORMATION
The following table sets forth for the year ended
January 2, 1994, certain information as to each of the
Company's five (5) most highly compensated executive
officers and as to all executive officers as a group:
Name of Individual
or Number of Capacities in Total Annual
Persons in Group Which Served Year Compensation
DAVID L. OSBORN President, CEO 1996 $0 (1)
1995 $0
1994 $0
THOMAS A. SACCO Senior Vice President 1996 $0 (2)
1995 $0
1994 $0
MITZY FERGUSON Secretary 1996 $36,000 (1)
1995 $47,500
1994 $44,000
JANE TAYLOR Treasurer 1996 $12,895 (1)
1995 $0
1994 $0
All executive officers
as a group (4 persons) $48,895
(1) Mr. Osborn and/or companies affiliated with him were
reimbursed for travel expenses incurred on behalf of the
Company, but received no remuneration for his work. In 1996
he or his affiliated companies were reimbursed $8,284 for
his travel. Ms. Ferguson was reimbursed $6,560 for her
travel expenses, and Ms. Taylor was reimbursed $19 for her
travel expenses.
(2) Mr. Sacco works for Dalms, Inc., which is being paid
consulting fees to provide his services to the Company. In
1996, Dalms, Inc., was paid $158,329 for Mr. Sacco's services
and travel. In addition, Mr. Sacco received unvested options
to purchase 400,000 shares of the Company's common stock.
Provided he is still furnishing services to the Company on a
fulltime basis as of the vesting date, each May 1st beginning
1995 and ending on May 1, 1998, options to purchase 100,000
shares will vest with him. The vested options are exercisable
at the market price as of the date of vesting.
Under the Company's Amended and Restated Incentive
Stock Option Plan adopted in 1989, and approved by the
shareholders (the "Plan"), the Company is authorized to
grant options to selected officers and employees to purchase
up to an aggregate of Eight Hundred Twenty Five Thousand
(825,000) shares of Common Stock. As of December 29, 1996,
there were no outstanding options to purchase shares of
Common Stock under the Plan. Under the terms of the Plan,
options are granted at not less than the fair market value
on the date of grant, become exercisable in increments of
twenty percent (20%) per year for each year of employment
after the date of grant (except the final twenty percent
(20%) increment becomes exercisable four (4) years and six
(6) months after the date of the grant) and remain
exercisable for a period of five (5) years from the date of
grant. The options terminate once employment terminates.
CERTAIN TRANSACTIONS
As of February 1994, the Company's headquarters were
moved from California to Dallas, Texas. The Company is now
leasing space for its headquarters from Wood, Osborn and
Osborn, a company partially owned by one of the Company's
directors, for $1,440 per month plus its share of utilities
expenses. The Company considers this rental a fair market
value for the space it is renting. This space is in the
same office building that leases space to the Company's
President and the companies controlled by him, including
companies that are franchisees of the Company; thus the
management of the Company is more efficient because its
executives work near the headquarters, and travel costs are
reduced.
Mr. David L. Osborn is affiliated with Southpoint
Management Corporation, DAC Associates and Famous Bars,
Grills & Cafes of America, Inc. ("FGA"). These companies,
in turn, are affiliated with owning and operating several
Hudson's restaurants in Texas, which are franchises granted
by the Company. The franchise agreement for Texas was
entered into before Mr. Osborn became involved in the
management of the Company. In March 1997, FGA agreed to
assign most of its exclusive franchise rights to Texas to a
company controlled by Mr. Travis Bryant. Mr. Bryant's
company will have the rights to develop Hudson's Grills in
Texas, excluding areas in or around El Paso, Austin and
Dallas/Fort Worth.
In January 1994, pursuant to obligations under an
agreement to reduce its debt to the Company's largest
creditor, Travis Bryant, the Company loaned an additional $1
million to FGA (which is evidenced by the "FGA Note"), which
was in addition to a debt of about $300,000 that FGA already
owed the Company. Prior to January 1994 FGA was also partly
owned by Mr. Bryant. If FGA failed to make any payments to
the Company, the Company had the right to use the payments
owed to it under the FGA Note to offset payments owed by the
Company to Mr. Bryant. In December 1996, the Company
reduced the principal on the FGA Note in exchange for the
transfer to it of additional royalty fees from Hudson's
Grills formerly owned by FGA. The modified FGA Note was
then transferred to Mr. Bryant in full satisfaction of the
Company's debt to Mr. Bryant.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS
VOTE FOR THE ELECTION OF THE TWO (2) NOMINEES FOR
DIRECTORS NAMED IN THIS PROXY STATEMENT.
Three (3) directors are to be elected, with each
director to hold office until the next Annual Meeting or
until his successor is elected and qualified. The persons
named as proxies in the enclosed Proxy have been designated
by management and intend to vote for the election of the two
persons named as nominees in this proxy statement
("Nominees"), except where authority is withheld by the
shareholder or specifically requested to be voted for
someone else. If no one is written in to be voted for as a
director who is willing to serve and no vote is specifically
withheld, then the persons holding the proxies will vote for
the two Nominees and the person they feel is best qualified
to be the third director. If one person other than a
Nominee is voted for on the proxy, then the persons holding
the proxy will vote for the Nominees and the requested
person, provided that the requested person is willing to
serve as a director. If two persons are voted for on the
proxy, then the person's holding the proxy will vote for the
two requested persons, provided they are willing to serve as
a director, and will decide which of the two Nominees to
vote for. If three persons other than Nominees are voted
for on the proxy, then the persons holding the proxy will
vote for the three requested persons, provided they are
willing to serve as a director. If more than three persons
are voted for on the proxy, then the persons holding the
proxies will vote for the Nominees and the person they feel
is best qualified, regardless of those requested.
PROPOSAL NO. 2
RATIFICATION OF THE SELECTION OF
INDEPENDENT AUDITORS
THE BOARD RECOMMENDS A VOTE IN FAVOR OF THIS
PROPOSAL.
Hein + Associates, LLP, has been selected as the
Company's independent auditors for the fiscal year ending
January 4, 1998. This firm served as the Company's
independent auditors for the period ended December 29, 1996.
PROPOSAL NO. 3
PROPOSAL TO AMEND THE COMPANY'S ARTICLES
OF INCORPORATION
THE BOARD RECOMMENDS A VOTE IN FAVOR OF THIS
PROPOSAL.
Description of the Proposed Amendment and Vote Required
On March 26, 1997, the Board of Directors unanimously
adopted resolutions approving a proposal to amend article
III of the Company's Articles of Incorporation in order to
authorize the issuance of up to 5,000,000 shares of
preferred stock. At one time, the Company was permitted to
issue preferred shares but none were ever apparently issued;
thus, a prior amendment to the Company's articles of
incorporation eliminated such authority. The Board of
Directors now have determined that such amendment is
advisable and directed that the proposed amendment be
considered at the Annual Meeting of Share Owners to be held
May 27, 1997. The affirmative vote of the holders of a
majority of the outstanding shares of Common Stock of the
Company is required to approve the proposed amendment.
The full text of the proposed amendment to the Articles
of Incorporation is set forth in Appendix A to this Proxy
Statement. The amendment will not affect shares of Common
Stock.
Purposes and Effects of Authorizing the Issuance of
Preferred Stock
The proposed amendment would permit the issuance of up
to 5,000,000 shares of preferred stock. Prior to the
issuance of any preferred stock, the rights and privileges
granted a preferred shareholder would be determined on a
series by series basis by the Company's directors.
Currently, the Company perceives several opportunities to
use preferred stock: to raise additional capital and to help
purchase restaurants to use as models. The Board of
Directors believes that authority to issue up to 5,000,000
shares of preferred stock should be a sufficient number, and
should more authority be needed in the future, the directors
will request a shareholder vote to amend again the articles
of incorporation. Granting the Company authority to issue
preferred stock will not cost the Company, except to the
extent that it incurs legal fees and filing fees to file
articles of amendment with the State of California, which
fees the Company feels will not be substantial. In order
that it have wider latitude in the future to raise capital
or to purchase assets, the Directors proposed and recommend
that the Company have the ability to issue preferred stock.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company has invited its accountants from Hein +
Associates, LLP, to be present at the Annual Meeting;
therefore they may be present. If a representative of Hein
+ Associates, LLP, is present at the Annual Meeting of
Shareholders, the representative will be allowed to answer
appropriate questions, and will be afforded an opportunity
to make a statement if so desired. Prior to the appointment
in December 1993 of Hein + Associates, LLP, Deloitte &
Touche was dismissed in December 1993 as the Company's
accountants and replaced by Hein + Associates, LLP. Neither
of Deloitte & Touche's reports for the previous two fiscal
years contained an adverse opinion or disclaimer of opinion,
or was modified as to uncertainty, audit scope, or
accounting principles. The Audit Committee of the Board of
Directors recommended to the Board that Hein + Associates,
LLP, be hired instead of Deloitte & Touche, and the
Directors so decided. The Company did not have any
disagreements with Deloitte & Touche about any accounting
matters, financial statement disclosure, or scope of audit
or procedure. Prior to hiring Hein + Associates, LLP, the
Company had not contacted them about what types of opinions
they might make about the Company's financial statements or
about any specific transactions.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's officers and directors, and persons
who own more than 10% of a registered class of the Company's
equity securities, to file reports of ownership and changes
of ownership with the Securities and Exchange Commission
(the "SEC"). Officers, directors and ten-percent
shareholders are required by SEC regulations to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely upon a review of the copies of the forms
furnished to the Company, or written representations from
certain reporting persons that no Forms 5 were required, the
Company believes that filing requirements applicable to its
officers and directors were complied with during the 1996
fiscal year.
DEADLINE FOR STOCKHOLDER PROPOSALS FOR 1998
Stockholder proposals to be presented at the 1998
Annual Meeting must be received by the Company on or before
February 1, 1998, for inclusion in the proxy statement and
form of proxy relating to that meeting.
OTHER MATTERS
Management of the Company does not know of any other
matters to be presented for action at the Annual Meeting.
However, if any other matters should be properly presented
at the Annual Meeting, it is the intention of the persons
named in the accompanying Proxy to vote said Proxy in
accordance with their best judgment.
OTHER INFORMATION
The Annual Report to Shareholders of the Company for
the year ended December 29, 1996, is mailed herewith to
shareholders of record at the close of business on April 18,
1997.
IF YOU WOULD LIKE A COPY OF THE COMPANY'S ANNUAL REPORT
OR FORM 10-KSB, PLEASE CONTACT THE SECRETARY AT (214) 931-
9237.
Mitzy Ferguson
Secretary
Dallas, Texas
April 25, 1997
f\sec\970421.O01
APPENDIX A
RESOLVED, that the Articles of Incorporation of
the Company be, and the same hereby is, amended by
deleting the current Article III thereof, and
substituting the following:
"III.
(A) The Corporation is authorized to
issue two classes of shares
designated "Common Stock" and
"Preferred Stock", respectively.
The number of shares of Common
Stock authorized to be issued is
100,000,000, and the number of
shares of Preferred Stock
authorized to be issued is
5,000,000.
(B) The Preferred Stock may be divided
into such number of series as the
board of directors may determine.
The board of directors is
authorized to determine and alter
the rights, preferences, privileges
and restrictions granted to or
imposed upon any wholly unissued
series of Preferred Stock, and to
fix the number of shares of any
series of Preferred Stock and the
designation of any such series of
Preferred Stock. The board of
directors, within the limits and
restrictions stated in any
resolution or resolutions of the
board of directors originally
fixing the number of shares
constituting any series, may
increase or decrease (but not below
the number of shares of such series
then outstanding) the number of
shares of any series subsequent to
the issue of shares of that
series."
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS
The undersigned hereby appoints DAVID L. OSBORN or THOMAS
SACCO, each with the power to appoint his or her substitute
and hereby authorizes them to represent and to vote, as
designated below, all shares of common stock of HUDSON'S
GRILL OF AMERICA, INC., held on record by the undersigned on
April 18, 1997, at the annual meeting to be held May 27,
1997.*
1. ELECTION OF DIRECTORS
FOR ALL NOMINEES PRINTED BELOW (except
as marked to the contrary below).
FOR THE FOLLOWING DIRECTORS (name up to
three):
WITHHOLD AUTHORITY TO VOTE FOR ALL
NOMINEES LISTED.
D.L. Osborn and T.A. Sacco. (Instructions: To
withhold authority to vote for any individual
nominees, line out that nominee's name).
2. RATIFICATION OF SELECTION OF HEIN + ASSOCIATES, LLP
FOR AGAINST ABSTAIN
3. AMENDMENT OF THE COMPANY'S ARTICLES OF INCORPORATION TO
GRANT AUTHORITY TO ISSUE UP TO 5,000,000 SHARES OF
PREFERRED STOCK
FOR AGAINST ABSTAIN
In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the meeting.
This proxy, when properly executed, will be voted in the
manner directed by the undersigned stockholder. If no
direction is made, this proxy will be voted for the Nominees
and for Proposals 2 and 3.
Date:
Signature
Signature
* Cumulative voting is permitted. See the proxy statement for
details.
