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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. _____)*
Cuco's, Inc.
(Name of Issuer)
Series A Convertible Preferred Stock, no par value per share
(Title of Class of Securities)
229725-10-6
(CUSIP Number)
Robert M. Walmsley, Jr.
Correro Fishman Haygood
Phelps Walmsley & Casteix, L.L.P.
201 St. Charles Avenue
46th Floor
New Orleans, Louisiana 70170-4600
(504) 586-5252
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
January 20, 2000
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box [ ].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Section 240.13d-7(b) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP No. 229725-10-6 13D Page 2 of 7 pages
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(1) NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Jacksonville Restaurant Acquisition Corporation
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) [ ]
(b) [ ]
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS (SEE INSTRUCTIONS):
WC
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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: (7) SOLE VOTING POWER
: 400,000 shares of Series A Convertible
: Preferred Stock, no par value per share
:-------------------------------------------------
: (8) SHARED VOTING POWER
NUMBER OF SHARES : 0 shares
BENEFICIALLY OWNED BY EACH :-------------------------------------------------
REPORTING PERSON WITH : (9) SOLE DISPOSITIVE POWER
: 400,000 shares of Series A Convertible
: Preferred Stock, no par value per share
:-------------------------------------------------
: (10) SHARED DISPOSITIVE POWER
: 0 shares
:
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
400,000 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES
[ ]
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
100%
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(14) TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): CO
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CUSIP No. 229725-10-6 13D Page 3 of 7 pages
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ITEM 1. SECURITY AND ISSUER
The class of equity securities to which this statement on Schedule 13D
relates is the Series A Convertible Preferred Stock, no par value per share (the
"Preferred Stock"), of Cucos, Inc. (the "Issuer"), a Louisiana corporation, with
principal offices located at 110 Veterans Boulevard, Suite 222, Metairie,
Louisiana 70005.
ITEM 2. IDENTITY AND BACKGROUND
This statement is filed on behalf of Jacksonville Restaurant
Acquisition Corporation ("JRAC"), a Delaware corporation. The information
required to be reported under this Item 2 with respect to each executive officer
and director of JRAC is set forth in Schedule A attached hereto and incorporated
by reference herein.
JRAC's principal business is acquiring companies in the casual dining
segment. The address of its principal office and principal business is 2211
Brighton Bay Trail, Jacksonville, Florida 32246.
During the last five years, neither JRAC nor, to the best of its
knowledge, any of the persons listed on Schedule A hereto has been (a) convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (b) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which any of them was or is subject to a
judgment, order, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
Each of the individuals listed in Schedule A hereto is a citizen of the
United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
In December 1999, JRAC entered into an Agreement (the "Agreement") with
the Issuer pursuant to which JRAC agreed to purchase 120,000 shares of the
Preferred Stock for a purchase price of $1.00 per share, or $120,000. The
Agreement granted JRAC the option to purchase an additional 180,000 shares of
the Preferred Stock (the "Option") for $1.00 per share, or $180,000. The Option
was exercisable on or before January 31, 2000 and was required to be exercised
as to all 180,000 shares of Preferred Stock.
On January 20, 2000, JRAC purchased an aggregate of 300,000 shares of
Preferred Stock for $300,000, which consisted of the initial 120,000 shares of
Preferred Stock that JRAC agreed to purchase for $120,000 under the Agreement
and an additional 180,000 shares of Preferred Stock that JRAC purchased for
$180,000 upon the exercise of the Option. On January 26, 2000, JRAC purchased an
additional 100,000 shares of Preferred Stock for $100,000.
JRAC used working capital in the aggregate amount of $400,000, which it
borrowed from a private investment group, to make these purchases of Preferred
Stock.
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CUSIP No. 229725-10-6 13D Page 4 of 7 pages
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ITEM 4. PURPOSE OF TRANSACTION
In December 1999, JRAC entered into the Agreement with the Issuer
pursuant to which JRAC agreed to purchase 120,000 shares of the Preferred Stock
for a purchase price of $1.00 per share, or $120,000. The Agreement granted JRAC
the Option to purchase an additional 180,000 shares of the Preferred Stock for
$1.00 per share, or $180,000. The Option was exercisable on or before January
31, 2000 and was required to be exercised as to all 180,000 shares of Preferred
Stock.
On January 20, 2000, JRAC purchased an aggregate of 300,000 shares of
Preferred Stock for $300,000, which consisted of the initial 120,000 shares of
Preferred Stock that JRAC agreed to purchase for $120,000 under the Agreement
and an additional 180,000 shares of Preferred Stock that JRAC purchased for
$180,000 upon the exercise of the Option. On January 26, 2000, JRAC purchased an
additional 100,000 shares of Preferred Stock for $100,000. JRAC used working
capital in the aggregate amount of $400,000, which it borrowed from a private
investment group, to make these purchases of Preferred Stock.
The Agreement provides further that the Issuer is considering the
issuance of up to 2,900,000 shares of its common stock (the "Common Stock")
pursuant to a rights offering (the "Rights Offering") in which the Issuer would
distribute to its stockholders the right to acquire additional shares of Common
Stock at a price to be established by the Issuer's board of directors. If the
Issuer consummates the Rights Offering, JRAC has agreed to exercise its rights
to purchase Common Stock with respect to 300,000 of its shares of Preferred
Stock (which agreement may be extended to all 400,000 of its shares of Preferred
Stock) by converting those shares of Preferred Stock into shares of Common Stock
and has agreed to purchase up to an additional 2,600,000 shares of Common Stock
registered for issuance in the Rights Offering to other stockholders of the
Issuer if those stockholders choose not to exercise their rights to purchase
Common Stock in the Rights Offering.
The purpose of the transactions reported herein by JRAC was and is an
investment in the securities of the Issuer with the possibility of acquiring
control of the Issuer through the acquisition of a majority of shares of the
Issuer's Common Stock.
The Agreement provides that if JRAC acquires a majority of the Issuer's
Common Stock in the Rights Offering, the Issuer's board of directors will
propose at a stockholders' meeting that James W. Osborn, who is the president of
JRAC, and three other persons designated by JRAC be elected to serve as members
of the board of directors of the Issuer. The Issuer's board of directors
consists of seven members. In the future, JRAC may invest additional funds in
the Issuer in exchange for additional representation on the Issuer's board of
directors.
The Agreement further grants JRAC the right to purchase the Issuer or
substantially all of the Issuer's assets if at any time prior to November 30,
2000 the Issuer proposes to enter into a definitive agreement to sell to a third
party.
Neither JRAC nor, to the best of its knowledge, any of the persons
named in Schedule A hereto has any present plans or proposals that would relate
to or result in any of the matters set forth in subparagraphs (a) - (j) of Item
4 of this Schedule 13D except as set forth herein or such as would occur upon
completion of any of the actions discussed above. JRAC intends to review its
investment
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CUSIP No. 229725-10-6 13D Page 5 of 7 pages
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in the Issuer on a continuing basis and, depending on various factors
including, without limitation, the Issuer's financial position and future
business plan, conditions in the securities markets and general economic and
industry conditions, may in the future take any of the actions described in
subparagraphs (a) - (j) of this Item 4 with respect to its investment in the
Issuer including, without limitation, purchasing additional shares of Preferred
Stock or Common Stock of the Issuer or selling some or all of its Preferred
Stock or Common Stock or changing its intention with respect to any of the
actions described in subparagraphs (a) - (j) of this Item 4.
Other than as described above, neither JRAC nor, to the best of its
knowledge, any of the persons named in Schedule A hereto, has any plans or
proposals which relate to or would result in:
(a) the acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of the Issuer or
any of its subsidiaries;
(d) any change in the present board of directors or management of the
Issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board;
(e) any material change in the present capitalization or dividend
policy of the Issuer;
(f) any other material change in the Issuer's business or corporate
structure;
(g) changes in the Issuer's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the Issuer by any person;
(h) causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
(i) a class of equity securities of the Issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934, as amended; or
(j) any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) JRAC is the beneficial owner of 400,000 shares of the Issuer's
Preferred Stock, representing 100% of the issued and outstanding shares of
Issuer Preferred Stock, which shares are convertible into 400,000 shares of
Issuer Common Stock, representing 15.1% of the 2,651,730 shares issued and
outstanding, as reported by the Issuer's latest report on Form 10-Q, which was
filed with the Securities and Exchange Commission on December 1, 1999. To the
knowledge of
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CUSIP No. 229725-10-6 13D Page 6 of 7 pages
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JRAC, no person named in Schedule A hereto is the beneficial owner
of any shares of the Issuer's Preferred Stock.
(b) JRAC has the sole power to vote or direct the vote and to dispose
or direct the disposition of the 400,000 shares of Preferred Stock reported
herein as beneficially owned by JRAC.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER
Pursuant to the Agreement, JRAC may be entitled to acquire a majority
of the Common Stock of the Issuer, to purchase the Issuer or substantially all
of the Issuer's assets under certain circumstances and to have the current
president of JRAC and three other individuals designated by JRAC elected to the
board of directors of the Issuer under certain circumstances. See the
information reported in Items 3 and 4 of this Schedule 13D.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
EXHIBIT 1 Agreement dated December 1999 by and between JRAC and
the Issuer.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
the undersigned certifies that the information set forth in this statement is
true, complete and correct.
JACKSONVILLE RESTAURANT
ACQUISITION CORPORATION
Dated: January 31, 2000. By: /s/ James W. Osborn
------------------------------------
James W. Osborn, President of
Jacksonville Restaurant Acquisition
Corporation
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CUSIP No. 229725-10-6 13D Page 7 of 7 pages
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SCHEDULE A
<TABLE>
<CAPTION>
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Name Officer/Director Business Address Principal Occupation
and Address
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<S> <C> <C> <C>
James W. Osborn President; Director 2211 Brighton Bay Trail President and CEO of
Jacksonville, Florida Cuco's, Inc.
32246 110 Veterans Boulevard
Suite 222
Metairie, LA 70005
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Calvin Cox Vice President; Director 2211 Brighton Bay Trail Dale Sorensen Real Estate,
Jacksonville, Florida Inc.
32246 634 Beachland Boulevard
Vero Beach, Florida 32963
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Dennis A. Grinn Vice President; Director 2211 Brighton Bay Trail Consultant for JRAC
Jacksonville, Florida 2211 Brighton Bay Trail
32246 Jacksonville, Florida 32246
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Nicholas J. Damadeo Secretary; Director 2211 Brighton Bay Trail Attorney at Law
Jacksonville, Florida 14 Loft Road
32246 Smithtown, NY 11787
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</TABLE>
<PAGE> 8
INDEX TO EXHIBIT
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
1 Agreement dated December 1999 by and between JRAC
and the Issuer
</TABLE>
<PAGE> 1
EXHIBIT 99.1
Caroline B. Blitzer - Agreement between Cucos and JRAC Page 1
AGREEMENT
This Agreement is made as of the __ day of December, 1999 by and
between Cucos, Inc. (the "Company") and Jacksonville Restaurant Acquisition
Corporation, Inc. ("JRAC").
WHEREAS, the Board of Directors of the Company have amended the
Company's Articles of Incorporation to authorize 300,000 shares of preferred
stock, no par value, having the rights and preferences set forth in the Articles
of Amendment attached hereto as Exhibit A (the "Preferred Stock");
WHEREAS, the Company desires to raise capital through the issuance and
sale of 300,000 shares of Preferred Stock for a purchase price of $1.00 per
share;
WHEREAS, the Company is considering the issuance of up to 2,900,000
shares of common stock of the Company (the "Common Stock") pursuant to a rights
offering to the Company's shareholders (the "Rights Offering");
WHEREAS, JRAC desires to purchase 300,000 shares of Preferred Stock of
the Company and to serve as a stand-by purchaser in the Rights Offering, all on
the terms and conditions hereinafter set forth;
WHEREAS, JRAC has demonstrated, to the satisfaction of the Board of
Directors of the Company, that JRAC has the financial ability to perform the
commitments made hereunder (which aggregate approximately $2,900,000);
NOW THEREFORE, it is agreed as follows:
ARTICLE I - SALE OF PREFERRED STOCK
1.01 Initial sale of Preferred Stock. JRAC hereby purchases 120,000
shares of Preferred Stock for an aggregate purchase price of $120,000. JRAC
acknowledges receipt of a certificate representing such shares. The Company
hereby acknowledges receipt of a wire transfer of $120,000 in full payment for
such shares.
1.02 Option to acquire additional shares of Preferred Stock. The
Company hereby grants to JRAC the option to purchase 180,000 additional shares
of Preferred Stock for a price of $1.00 per share (the "Option"). The Option
shall be exercisable on or before January 31, 1999, and shall expire on
January 31, 1999 (the "Expiration Date"). The Option must be exercised as to
the entire amount of the Preferred Stock covered by the Option. The Option is
may be exercised by delivering to the Company written notice of exercise,
accompanied by a certified check for $180,000 on or before the Expiration Date.
1.03 Accredited investor. JRAC hereby represents and warrants to the
Company that JRAC is an "accredited" investor within the meaning of Regulation D
under the Securities Act of
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Caroline B. Blitzer - Agreement between Cucos and JRAC Page 2
1933, as amended. JRAC also represents and warrants that JRAC is a sophisticated
investor in the restaurant industry and has made such investigation as it deems
necessary of the Company's business, financial condition and prospects prior to
investing in the Preferred Stock.
ARTICLE II - DUE DILIGENCE REVIEW
2.01 JRAC's review of the Company's operations. Until the Expiration
Date, JRAC shall be entitled to conduct due diligence of the Company, and the
Company will make available to JRAC all of the Company's books and records as
JRAC shall reasonably request to assess the advisability of exercising the
Option. The Company shall give JRAC the opportunity to discuss the Company's
financial condition and prospects with third parties (including the Company's
employees, vendors and creditors); provided, however, that the Company reserves
the right to deny JRAC access to such persons if the Chairman of the Board of
the Company, in his sole discretion, deems it appropriate to deny such access.
2.02 Confidentiality. JRAC agrees that it, and its owners, officers,
employees and agents, will keep confidential any information about the Company
made available to JRAC in connection with its due diligence review. If JRAC
determines not to exercise the Option, then JRAC will return to the Company all
documentation and other materials delivered to JRAC in connection with its due
diligence review. JRAC acknowledges that the information to be delivered to JRAC
in connection with its due diligence review may be highly proprietary and
confidential. JRAC further acknowledges that the Company's common stock is
publicly traded, and that neither JRAC nor any of its owners, officers,
employees or agents should engage in the purchase or sale of shares of the
Company's common stock when in possession of material non-public information.
Accordingly, JRAC agrees that neither JRAC nor any of its owners, officers,
employees or agent will purchase or sell any shares of Common Stock (except for
purchases of Common Stock in connection with the Rights Offering) for a period
of one month following the Expiration Date.
ARTICLE III - POSSIBLE RIGHTS OFFERING
3.01 Terms of possible Rights Offering. The Company hereby represents
that the Board of Directors is considering the advisability of a Rights Offering
pursuant to which the Company would distribute to its shareholders the right to
acquire additional shares of Common Stock for a price to be established by the
Board of Directors (the "Rights Offering Price"). JRAC acknowledges that, upon
the effectiveness of a Registration Statement covering the shares to be issued
in the Rights Offering, the Preferred Stock would be converted, in accordance
with its terms, into shares of Common Stock.
3.02 Commitment by JRAC to be stand-by purchaser. JRAC hereby agrees
that, if JRAC exercises the Option, JRAC will exercise its rights with respect
to the 300,000 shares of Common Stock to be owned by JRAC upon the automatic
conversion of its Preferred Stock. JRAC further agrees to purchase up to an
additional 2,600,000 shares of Common Stock registered for issuance in the
Rights Offering to other shareholders of the Company if such
<PAGE> 3
Caroline B. Blitzer - Agreement between Cucos and JRAC Page 3
shareholders elect not to exercise their rights to purchase such shares. All
purchases by JRAC will be made at the Rights Offering Price.
ARTICLE IV - MANAGEMENT OF THE COMPANY PRIOR TO
COMPLETION OF RIGHTS OFFERING
4.01 Board of Directors. Upon JRAC's purchase of the initial 120,000
shares of Preferred Stock, Dennis Grinn shall be elected by the Board of
Directors to fill a vacancy currently existing on the Board of Directors. Dennis
Grinn shall serve until the next annual meeting of shareholders and until his
successor shall be elected and have qualified.
4.02 President of Company. The Company agrees that if the Option is
exercised, and until the earlier of (a) the closing of the Rights Offering; (b)
the closing of a transaction involving a sale of the Company or its assets that
is inconsistent with a rights offering or (c) James W. Osborn is relieved of his
position with the Company for "cause", James W. Osborn shall be the president of
the Company and responsible for day-to-day management of the Company. It is
agreed that the term "cause" shall mean an action involving the misappropriation
of Company funds or assets.
4.03 Management of the Company following completion of the Rights
Offering. The Board of Directors of the Company hereby agrees that, if the
Rights Offering is consummated and JRAC becomes a majority shareholder pursuant
to its commitment in Section 3.02 hereof, then the Company shall hold a
shareholders' meeting at which the Board will propose the following persons to
be directors of the Company: (a) James W. Osborn; (b) three other persons
designated by JRAC; and (c) three persons to be designated by the Board of
Directors.
ARTICLE V - ABILITY TO "SHOP" THE COMPANY;
RIGHT OF FIRST REFUSAL
5.01 Right to sell. Nothing contained in this Agreement shall prohibit
the Board of Directors of the Company from actively seeking a purchaser for the
Company or its assets or from taking any action that the Board believes to be
necessary or appropriate to manage the Company or to sell the Company or its
assets.
5.02 Right of first refusal. If, at any time prior to November 30,
2000, the Company proposes to enter into a definitive agreement to sell to a
third party (the "Proposed Purchaser") the Company or substantially all of its
assets, then JRAC shall have the right to purchase the Company or substantially
all of its assets, as the case may be, at the same price as the Proposed
Purchaser has agreed to pay. If the purchase price to be paid by the Proposed
Purchaser in consideration other than cash, then JRAC shall be entitled to pay
the fair market value of such consideration in cash.
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Caroline B. Blitzer - Agreement between Cucos and JRAC Page 4
ARTICLE VI - MISCELLANEOUS
6.01 Specific performance. JRAC acknowledges that the Company may
conduct a Rights Offering based upon the Company's reliance that JRAC will
perform its commitments under Section 3.02 hereof. JRAC agrees that the Company
shall be entitled to a remedy of specific performance, in addition to any
damages that may be due, if JRAC refuses to perform its commitments under
Section 3.02 hereof.
6.02 Choice of law and venue. The parties agree that this Agreement
shall be governed by Louisiana law, and that any dispute related to this
agreement would be submitted to the exclusive jurisdiction of the courts of
Jefferson parish, Louisiana.
6.03 Entire agreement. This Agreement, together with any written
amendment hereto, represents the entire agreement of the parties with respect to
the matters covered hereby.
6.04 Term. This Agreement shall terminate on the Expiration Date if the
Option is not exercised by JRAC. If the Option is exercised by JRAC, this
Agreement shall terminate on the earlier of (a) the date that the Rights
Offering shall have been consummated; (b) the date that the Company or
substantially all of its assets, is/are sold to a third party; or (c) April 30,
2000.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth above.
CUCOS, INC.
By: /s/ FRANK J. FERRARA, JR.
-----------------------------------
Frank J. Ferrara, Jr.,
Chairman of the Board
JACKSONVILLE RESTAURANT ACQUISITION CORPORATION, INC.
By:
-----------------------------------
