SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)
Sbarro, Inc.
----------------------------------------------------------
(Name of Issuer)
Common Stock, par value $.01 per share
------------------------------------------------------------------
(Title of class of securities)
805844-10-7
--------------------------
(CUSIP Number)
<TABLE>
<S> <C>
Richard A. Rubin, Esq. Arthur A. Katz, Esq.
Parker Chapin Flattau & Klimpl, LLP Warshaw Burstein Cohen Schlesinger & Kuh, LLP
1211 Avenue of the Americas 555 Fifth Avenue
New York, New York 10036 New York, New York 10017
212-704-6000 212-984-7700
</TABLE>
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(Person Authorized to Receive Notices and Communications)
June 17, 1999
-----------------------------------------------------
(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 Rule 13d-1(b)(3) or (4), check the following box [ ]
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 2 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mario Sbarro, individually and as co-trustee of the Trust of Carmela
Sbarro
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,911,396
OWNED BY
EACH
REPORTING
PERSON
WITH
- --------------------- 8 SHARED VOTING POWER
2,504,074
9 SOLE DISPOSITIVE POWER
1,911,396
10 SHARED DISPOSITIVE POWER
2,504,074
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,415,470 (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 7,855,656 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
21.1% (may be deemed beneficially own all shares beneficially owned
by each member of the group, or 38.7%)
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 3 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anthony Sbarro
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,432,133
OWNED BY
EACH
REPORTING
PERSON
WITH
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
1,432,133
10 SHARED DISPOSITIVE POWER
0
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,432,133 (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 7,855,656 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.9% (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 38.7%)
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 4 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Joseph Sbarro
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 2,007,913
OWNED BY
EACH
REPORTING
PERSON
WITH
- ---------------------
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
2,007,913
10 SHARED DISPOSITIVE POWER
0
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,007,913 (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 7,855,656 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.7% (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 38.7%)
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 5 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Joseph Sbarro (1994) Family Limited Partnership
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
NEW YORK
NUMBER OF 7 SOLE VOTING POWER
SHARES 609,000
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
- ---------------------
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
609,000
10 SHARED DISPOSITIVE POWER
0
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
609,000 (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 7,855,656 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.0% (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 38.7%)
14 TYPE OF REPORTING PERSON*
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 6 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Franklin Montgomery, as co-trustee of the Trust of Carmela Sbarro
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 0
OWNED BY
EACH
REPORTING
PERSON
WITH
- ---------------------
8 SHARED VOTING POWER
2,497,884
9 SOLE DISPOSITIVE POWER
0
10 SHARED DISPOSITIVE POWER
2,497,884
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,497,844 (may be deemed to beneficially own all shares beneficially
owned by each member of the group, or 7,855,656 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
12.2% (may be deemed to beneficially own all shares beneficially
owned by each member of the group, 38.7%)
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 805844 10 7 13D PAGE 7 OF 18 PAGES
-----------
1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Sbarro Merger LLC
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
SC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
NEW YORK
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 0
OWNED BY
EACH
REPORTING
PERSON
WITH
- ---------------------
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
0
10 SHARED DISPOSITIVE POWER
0
----------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 (may be deemed to beneficially own all shares beneficially owned
by each member of the group, or 7,855,516 shares)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0% (may be deemed to beneficially own all shares beneficially
owned by each member of the group, 38.7%)
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP No. 805844 10 7 13D Page 8 of 18
INTRODUCTION
This Amendment ("Amendment No. 4") is being filed jointly, pursuant to
Rule 13d-1(f)(1) promulgated under the Securities Exchange Act of 1934, as
amended, by: (i) Mario Sbarro, individually and as co-trustee of the Trust of
Carmela Sbarro, (ii) Anthony Sbarro, (iii) Joseph Sbarro, (iv) Joseph Sbarro
(1994) Family Limited Partnership (the "Partnership"), (v) Franklin Montgomery,
as co-trustee of the Trust of Carmela Sbarro, and (vi) Sbarro Merger LLC
("Mergeco") to amend the Schedule 13D (the "Original Schedule 13D") filed by the
Reporting Persons (other than the Partnership and Mergeco) on January 22, 1998,
as amended by Amendment No. 1 thereto filed by the Reporting Persons (other than
the Partnership and Mergeco) on June 24, 1998, Amendment No. 2 thereto filed by
the Reporting Persons (other than the Partnership and Mergeco) on December 2,
1998 and Amendment No. 3 thereto filed by the Reporting Persons on January 22,
1999. The Original Schedule 13D, as heretofore amended, is referred to as the
"Existing Schedule 13D". This Amendment No. 4, among other things, adds the
Partnership and Mergeco as Reporting Persons.
All terms used, but not defined, in this Amendment are as defined in
the Existing Schedule 13D. The summary descriptions contained herein of certain
agreements and documents are qualified in their entirety by reference to the
complete text of such agreements and documents filed as Exhibits hereto or
incorporated herein by reference.
The existing Schedule 13D is amended and restated in its entirety to
read as follows:
ITEM 1. SECURITY AND ISSUER.
This statement relates to shares of the Common Stock, par value $.01
per share (the "Common Stock"), of Sbarro, Inc., a New York corporation (the
"Company"). The Company's principal executive office is at 401 Broadhollow Road,
Melville, New York 11747.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This statement is being filed jointly pursuant to Rule 13d-1 (f)(1)
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), by: (i) Mario Sbarro individually and as co-trustee under that certain
Trust Agreement dated April 28, 1984 for the benefit of Carmela Sbarro and her
descendants (the "Trust of Carmela Sbarro"), (ii) Anthony Sbarro, (iii) Joseph
Sbarro, (iv) Joseph Sbarro (1994) Family Limited Partnership (the
"Partnership"), (v) Franklin Montgomery, as co-trustee of the Trust of Carmela
Sbarro, and (vi) Sbarro Merger LLC (individually, a "Reporting Person" and,
collectively, the "Reporting Persons").
Information with respect to each Reporting Person is given solely by
such Reporting Person. No Reporting Person has responsibility for the accuracy
or completeness of the information supplied
<PAGE>
CUSIP No. 805844 10 7 13D Page 9 of 18
June 23, 1999by any other Reporting Person, and each Reporting Person agrees
that this statement is filed on behalf of such Reporting Person only.
The Reporting Persons may be deemed to constitute a "group" for the
purposes of Rule 13d-3 of the Exchange Act.
(b) The business address of each of Mario Sbarro, Anthony Sbarro and
Joseph Sbarro is 401 Broadhollow Road, Melville, NY 11747. The principal
business address of the Partnership is c/o Joseph Sbarro, 401 Broadhollow Road,
Melville, New York 11747. The business address of Franklin Montgomery is 488
Madison Avenue, New York, New York 10022. The business address of Sbarro Merger
LLC ("Mergeco") is c/o Mario Sbarro, 401 Broadhollow Road, Melville, New York
11747.
(c) The principal occupation or employment of Mario Sbarro, Anthony
Sbarro and Joseph Sbarro is as follows: (i) Mario Sbarro is the Chairman of the
Board of Directors, Chief Executive Officer, President and a director of the
Company; (ii) Anthony Sbarro is the Vice Chairman of the Board of Directors,
Treasurer and a director of the Company; and (iii) Joseph Sbarro is Senior
Executive Vice President, Secretary and a director of the Company. The Company
is a leading operator and franchiser of family-style Italian restaurants. The
address of the Company is 401 Broadhollow Road, Melville, NY 11747.
The Partnership is a New York limited partnership formed to hold
certain investments for the family of Joseph Sbarro. The Partnership's business
address is c/o Joseph Sbarro, 401 Broadhollow Road, Melville, New York 11747.
Joseph Sbarro is the sole general partner of the Partnership.
Franklin Montgomery is an attorney in sole practice. His business
address is 488 Madison Avenue, Suite 1100, New York, New York 10022.
Mergeco, a New York limited liability company formed by the Reporting
Persons to facilitate the Merger (as defined in Item 4), has no business or
operations and will be merged with and into the Company, with the Company as the
surviving corporation upon consummation of the Merger. Mergeco's business
address is c/o Mario Sbarro, 401 Broadhollow Road, Melville, New York 11747. The
members of Mergeco are Mario Sbarro, Joseph Sbarro, the Partnership, Anthony
Sbarro and the Trust of Carmela Sbarro.
(d) During the last five years, neither any Reporting Person nor the
Company has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) During the last five years, neither any Reporting Person nor the
Company has been a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction as a result of which such person or entity was or
is subject to a judgment, decree or final order enjoining future
<PAGE>
CUSIP No. 805844 10 7 13D Page 10 of 18
violations of, or prohibiting or mandating activities subject to, Federal or
State securities laws or finding any violation with respect to such laws.
(f) Each of the Reporting Persons is a citizen of the United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Each of the Reporting Persons (in the case of Franklin Montgomery, as a
trustee of the Trust of Carmela Sbarro) has held the shares of Common Stock
beneficially owned (excluding unexercised stock options referred to in Items 5
and 6 below) by such Reporting Person as reported herein for more than four
years. No funds were involved in the formation of the group by the Reporting
Persons.
Approximately $408 million will be required to pay the aggregate Merger
Consideration (as defined in Item 4) to shareholders of the Company (other than
the Reporting Persons) and to holders of options to purchase shares of the
Company's Common Stock (including Mario Sbarro, Anthony Sbarro and Joseph
Sbarro) at the closing of the Merger (as defined in Item 4), as well as the
anticipated fees and expenses of the contemplated transactions. It is
anticipated that the sources of the required funds will be $138 million of the
Company's cash and marketable securities and $300 million to be obtained through
debt financing, including to fund the Company's ongoing working capital needs,
including capital expenditures. The Reporting Persons have received a letter
from Bear, Stearns & Co. Inc. ("Bear Stearns") that, subject to certain
conditions, Bear Stearns is highly confident that the debt financing can be
obtained. A copy of that letter is Exhibit 4 to this Schedule 13D.
ITEM 4. PURPOSE OF TRANSACTION.
On January 12, 1998, Mario Sbarro, Joseph Sbarro, Anthony Sbarro and
the Trust of Carmela Sbarro presented to the Company's Board of Directors a
proposal for, subject to certain conditions, the merger of the Company with a
company to be formed, pursuant to which the shareholders of the Company, other
than the Reporting Persons, would receive $28.50 per share in cash for their
shares. On June 17, 1998, negotiations regarding that proposal terminated. On
November 25, 1998, the same persons made a similar offer pursuant to which the
shareholders of the Company, other than the Reporting Persons, would receive
$27.50 in cash for their shares. A copy of this proposal is Exhibit 2 to this
Schedule. On January 19, 1999, the Company, Mergeco and the Reporting Persons
entered into an Agreement and Plan of Merger with respect to such transaction
(the "Merger Agreement"). On June 17, 1999, the Company, Mergeco and the
Reporting Persons entered into an Amended and Restated Agreement Plan of Merger
(the "Merger Agreement") to make certain non-economic and, except to extend the
date after which either the Company or the Reporting Persons could terminate the
transactions solely by reason of the Merger not having been consummated from
June 30, 1999
<PAGE>
CUSIP No. 805844 10 7 13D Page 11 of 18
to August 31, 1999, non-substantive changes to the Merger Agreement, and
restated the Merger Agreement as so amended (the "Restated Merger Agreement").
The following is a brief discussion of the Restated Merger Agreement and is
qualified in its entirety by reference to the Restated Merger Agreement, a copy
of which is Exhibit 3 to this Schedule.
The Restated Merger Agreement provides for the merger of Mergeco with
and into the Company (the "Merger"), with each outstanding share of Common
Stock, other than shares held of record by Mergeco or the Reporting Persons or
in the Company's treasury, to be converted into the right to receive $28.85 in
cash (the "Merger Consideration"). The shares to be purchased comprise
approximately 65.6% of the Company's 20,534,313 presently outstanding shares of
Common Stock. In addition, all outstanding stock options, including those held
by the Reporting Persons, will be terminated. For each such option, the holder
thereof will be paid the difference between the Merger Consideration and the
exercise price per share, multiplied by the total number of shares of Common
Stock subject to such option.
On January 19, 1999, the Merger Agreement was approved and adopted by
the Board of Directors of the Company following the unanimous recommendation by
a special committee of independent directors. Prudential Securities
Incorporated, which has been acting as financial advisor to the special
committee, rendered its opinion dated January 19, 1999 to the special committee
that, as of the date of such opinion, the Merger Consideration is fair from a
financial point of view to the public shareholders. On June 17, 1999, the
changes to the Merger Agreement effected in the Restated Merger Agreement were
approved by the Company's Board of Directors, following approval thereof by the
special committee, and the Company's Board of Directors adopted the Restated
Merger Agreement.
The purpose of the Merger is for the Reporting Persons to acquire the
Company through the Merger. The Restated Merger Agreement contains certain
conditions to closing, including, among other things, (i) approval by a majority
of the votes cast (excluding votes cast by the Reporting Persons, abstentions
and broker non-votes) at a meeting of the Company's shareholders to be called to
consider adoption of the Restated Merger Agreement, (ii) receipt of financing
for the transactions contemplated by the Restated Merger Agreement, (iii) the
continued suspension of dividends by the Company and (iv) the settlement of
shareholder class action lawsuits that have been filed relating to the Merger.
The Reporting Persons have received a letter from Bear Stearns that,
subject to certain conditions, Bear Stearns is highly confident that the debt
financing for the transaction can be obtained. A copy of that letter is annexed
as Exhibit 4 to this Schedule 13D.
A Memorandum of Understanding, which contemplates the Merger
Consideration of $28.85, was entered into on January 19, 1999 with counsel to
the plaintiffs in the shareholder class actions
<PAGE>
CUSIP No. 805844 10 7 13D Page 12 of 18
arising from the proposed Merger for the proposed settlement of such lawsuits
and, on April 7, 1999, a Stipulation of Settlement was entered into with counsel
to the plaintiffs in such litigation embodying (and superceding) the Memorandum
of Understanding. The settlement is subject to, among other things, (i)
certification of the lawsuits as a class action covering all record and
beneficial owners of the Common Stock during the period beginning on November
25, 1998 through the effective time of the Merger (the "Class"), (ii) court
approval of the settlement, and (iii) consummation of the Merger. It is a
condition to Mergeco's obligation under the Restated Merger Agreement that
holders of no more than an aggregate of 1,000,000 shares of Common Stock
(approximately 4.9% of the Company's presently outstanding shares) request
exclusion from the settlement. A hearing is scheduled to be held on June 29,
1999 to, among other things, determine whether the court should approve the
settlement as fair, reasonable, adequate and in the best interest of the Class.
A copy of the Stipulation of Settlement is annexed as Exhibit 5 to this
Schedule.
The proposed transactions would, if and when consummated, result in the
Company's Common Stock ceasing to be authorized for listing on the New York
Stock Exchange, Inc. and becoming eligible for termination of registration under
Section 12(g)(4) of the Exchange Act.
Except as described above, no Reporting Person has any present plans or
proposals that relate to or would result in: (i) the acquisition of additional
securities of the Company or the disposition of securities of the Company; (ii)
an extraordinary corporate transaction, such as a merger, reorganization or
liquidation of the Company; (iii) a sale or transfer of a material amount of
assets of the Company or any of its subsidiaries; (iv) any change in the present
board of directors or management of the Company, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board; (v) any material change in the present capitalization or
dividend policy of the Company; (vi) any other material change in the Company's
business or corporate structure, (vii) any changes in the Company's charter,
by-laws or instruments corresponding thereto or other actions which may impede
the acquisition of control of the Company by any person; (viii) causing a class
of securities of the Company to be delisted from a national securities exchange
or cease to be authorized to be quoted in an inter-dealer quotation system of a
registered national securities association; (ix) causing a class of equity
securities of the Company to become eligible for termination of registration
pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934; or (x) any
action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The Reporting Persons may be deemed a group within the meaning of
Rule 13d-5 under the Exchange Act and, therefore, each of the Reporting Persons
may be deemed to be the beneficial owner, within the meaning of Rule 13d-3 under
the Exchange Act, of all of the shares beneficially owned by each member of the
group, or an aggregate of 7,855,656 shares of Common Stock of the Company,
representing, based on the 20,534,313 shares of Common Stock which were
<PAGE>
CUSIP No. 805844 10 7 13D Page 13 of 18
issued and outstanding on June 15, 1999 and the portion of options to purchase
shares of Common Stock held by the Reporting Persons which were then exercisable
or become exercisable within 60 days after such date, approximately 38.7% of the
total of the outstanding shares of the Company's Common Stock and such portion
of such options.
Mario Sbarro may be deemed to be the beneficial owner of 4,415,470
(21.1%) of the issued and outstanding shares of Common Stock.
Anthony Sbarro is the beneficial owner of 1,432,133 (6.9%) of the
issued and outstanding shares of Common Stock.
Joseph Sbarro may be deemed to be the beneficial owner of 2,007,913
(9.7%) of the issued and outstanding shares of Common Stock.
The Partnership is the beneficial owner of 609,000 (3.0%) of the issued
and outstanding shares of Common Stock.
Franklin Montgomery, as co-trustee of the Trust of Carmela Sbarro, may
be deemed to be the beneficial owner of 2,497,884 (12.2%) of the issued and
outstanding shares of Common Stock.
Mergeco is not presently the beneficial owner of any shares of Common
Stock.
(b) The following table sets forth information as to shares of Common
Stock as to which each Reporting Person individually has sole or shared power to
vote or to direct the disposition at June 15, 1999:
<TABLE>
<CAPTION>
Shares with Shares with
Sole Power to Shared Power to Total
Vote and Vote and ------------------
Direct Disposition Direct Disposition Shares %
------------------ ------------------ ------ ----
<S> <C> <C> <C> <C>
Mario Sbarro 1,911,396 (1) 2,504,074 (2) 4,415,770 (1) 21.1
Anthony Sbarro 1,432,133 (3) - 1,432,133 (3) 6.9
Joseph Sbarro 2,007,913 (4) - 2,007,913 (4) 9.7
Joseph Sbarro (1994) Family Limited
Partnership 609,000 (5) - 609,000 (5) 3.0
Franklin Montgomery, as co-trustee 2,497,884 (5)
of the Trust of Carmela Sbarro - 2,497,884 (5) 12.2
Sbarro Merger LLC 0 - 0 -
- --------------------
</TABLE>
<PAGE>
CUSIP No. 805844 10 7 13D Page 14 of 18
(1) Includes 386,666 shares which are not outstanding but which are subject
to issuance upon exercise of the portion of options held by Mario
Sbarro that are presently exercisable or exercisable within 60 days of
June 15, 1999.
(2) Includes (i) 5,450 shares of Common Stock held by a charitable
foundation supported by Mario Sbarro and his wife, of which Mario
Sbarro, his wife and another director of the Company are directors,
(ii) 2,497,884 shares of Common Stock held by the Trust of Carmela
Sbarro, of which Mario Sbarro is one of two trustees and (iii) 740
shares of Common Stock owned by the wife of Mario Sbarro. The reporting
of these shares should not be construed as an admission that Mario
Sbarro is, for purposes of Section 13 of the Exchange Act or otherwise,
the beneficial owner of these shares.
(3) Includes 198,333 shares of Common Stock which are not outstanding but
are subject to issuance upon exercise of the portion of options held by
Anthony Sbarro that are presently exercisable or exercisable within 60
days of June 15, 1999.
(4) Includes (i) 199,999 shares of Common Stock which are not outstanding
but which are subject to issuance upon exercise of the portion of
options held by Joseph Sbarro that are presently exercisable or
exercisable within 60 days of June 15, 1999 and (ii) 609,000 shares of
Common Stock owned by the Partnership, of which Joseph Sbarro is the
sole general partner. The reporting of such 609,000 shares should not
be construed as an admission that Joseph Sbarro is, for purposes of
Section 13 of the Exchange Act or otherwise, the beneficial owner of
all of these shares.
(5) Joseph Sbarro is the sole general partner of the Partnership. These
shares are also included in the shares that may be deemed to be
beneficially owned by Joseph Sbarro reflected above.
(6) Represents shares of Common Stock owned by the Trust of Carmela Sbarro,
of which Mr. Montgomery is one of the two trustees. Mario Sbarro is the
other trustee and these shares also are included in the shares that may
be deemed to be beneficially owned by Mario Sbarro as reflected above.
(c) No Reporting Person has engaged in any transaction in the Company's
Common Stock since sixty (60) days prior to the date of the Original Schedule
13D, except that (i) on December 1, 1998, Mario Sbarro made gifts aggregating
7,400 shares to his children and their spouses and (ii) certain stock options
held by Mario, Anthony and Joseph Sbarro under the Company's stock option plans
have, as described in Item 6, vested in accordance with their terms.
<PAGE>
CUSIP No. 805844 10 7 13D Page 15 of 18
(d) No person other than the Reporting Persons is known to have the
right to receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, securities of the Company beneficially owned by the
Reporting Persons.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
To the knowledge of each Reporting Person on the date hereof,
no Reporting Person has any contract, arrangement, understanding or relationship
(legal or otherwise) with any person with respect to securities issued by the
Company, including, but not limited to, transfer or voting of any such
securities, finder's fees, joint ventures, loan or option arrangements, puts or
calls, guarantees of profits, divisions of profits or loss or the giving or
withholding of proxies, except:
(a) The Reporting Persons have agreed, in the Restated Merger
Agreement, (i) to vote at the shareholders meeting to be held to consider the
Merger all 7,064,357 shares of outstanding Common Stock owned of record by them
for adoption of the Merger Agreement but only if at least a majority of the
votes cast (excluding votes cast by the Reporting Persons, abstentions and
broker non-votes) are cast in favor of adoption of the Restated Merger
Agreement, (ii) not to grant a proxy to vote any of their shares other than to
another Reporting Person or to persons identified in a proxy card distributed on
behalf of the Company's Board of Directors to vote such shares in the manner
provided in (i), and (iii) not to sell, transfer or otherwise dispose of any of
their shares (other than transfers to other Reporting Persons or any family
members of Mario Sbarro, Anthony Sbarro or Joseph Sbarro or trusts for their
benefit or such family members), which shares may be so transferred only if,
among other things, the transferee agrees in writing to be bound by the terms of
the foregoing agreements.
(b) Mario Sbarro holds options to purchase (1) 150,000 shares
of Common Stock at an exercise price of $20.67 per share granted to him on May
30, 1990 by action of the Board of Directors and approved by the shareholders of
the Company, which option is presently exercisable in full and expires on May
29, 2000; (ii) 120,000 shares of Common Stock at an exercise price of $27.08 per
share granted to him on December 28, 1993 under the Company's 1991 Stock
Incentive Plan (the "1991 Plan"), which option is presently exercisable in full
and expires on December 27, 2003; (iii) 100,000 shares of Common Stock at an
exercise price of $24.75 per share granted to him on August 20, 1996 under the
1991 Plan, which option is exercisable as to one-third of the number of shares
of Common Stock subject to the option annually, on a cumulative basis,
commencing on August 20, 1998 and expires on August 19, 2006; (iv) 100,000
shares of Common Stock at an exercise price of $25.125 per share granted to him
on February 19, 1997 under the 1991 Plan, which option is exercisable as to
one-third of the number of shares of Common Stock subject to the option
annually, on a cumulative basis, commencing February 19, 1999 and expires on
February 18, 2007; and (v) 150,000 shares of Common Stock at an exercise price
of $28.875 granted to him on May 21,
<PAGE>
CUSIP No. 805844 10 7 13D Page 16 of 18
1997 under the 1991 Plan, which option becomes exercisable as to one-third of
the number of shares of Common Stock subject to the option annually, on a
cumulative basis, commencing February 19, 1999 and expires on May 20, 2007.
(c) Anthony Sbarro holds options to purchase (i) 75,000 shares
of Common Stock at an exercise price of $20.67 per share granted to him on May
30, 1990 by action of the Board of Directors and approved by shareholders of the
Company, which option is presently exercisable in full and expires on May 29,
2000; (ii) 90,000 shares of Common Stock at an exercise price of $27.08 per
share granted to him on December 28, 1993 under the 1991 Plan, which option is
presently exercisable in full and expires on December 27, 2000 and (iii) 100,000
shares of Common Stock at an exercise price of $25.125 per share granted to him
on February 19, 1997 under the 1991 Plan, which option becomes exercisable as to
one-third of the number of shares subject to the option annually, on a
cumulative basis, commencing February 19, 1999 and expires on February 18, 2007.
(d) Joseph Sbarro holds options to purchase (i) 75,000 shares
of Common Stock at an exercise price of $20.67 per share granted to him on May
30, 1990 by action of the Board of Directors and approved by the shareholders of
the Company, which option is presently exercisable in full and expires on May
29, 2000; (ii) 75,000 shares of Common Stock at an exercise price of $27.08 per
share granted to him on December 28, 1993 under the 1991 Plan, which option is
presently exercisable in full and expires on December 27, 2000; (iii) 50,000
shares of Common Stock at an exercise price of $24.75 per share granted to him
on August 20, 1996 under the 1991 Plan, which option is exercisable as to
one-third of the number of shares subject to the option annually, on a
cumulative basis, commencing on August 20, 1998 and expires on August 19, 2006;
and (iv) 100,000 shares of Common Stock at an exercise price of $25.125 per
share granted to him on February 19, 1997 under the 1991 Plan, which option
becomes exercisable as to one-third of the number of shares subject to the
option annually, on a cumulative basis, commencing February 19, 1999 and expires
on February 18, 2007.
<PAGE>
CUSIP No. 805844 10 7 13D Page 17 of 18
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit Description
------- -----------
1. Joint Filing Agreement dated as of June 22, 1999
among Mario Sbarro, Anthony Sbarro, Joseph Sbarro and
Franklin Montgomery, as trustee of the Trust of
Carmela Sbarro and Mergeco.
2. Proposal dated November 25, 1998 on behalf of the
Reporting Persons to the Board of Directors of the
Company.
3. Amended and Restated Agreement and Plan of Merger
dated as of January 19, 1999 among the Company and
the Reporting Persons. (Incorporated by reference to
Exhibit 2 to the Company's Current Report on Form 8-K
dated (date of earliest event reported) June 17,
1999, File No. 1-8881)
4. Letter dated as of January 19, 1999 from Bear Stearns
& Co. Inc. to the Reporting Persons. (Incorporated by
reference to Exhibit 99.02 to the Company's Current
Report on Form 8-K dated (date of earliest event
reported) June 17, 1999, File No.
1-8881)
5. Stipulation of Settlement dated April 7, 1999 among
counsel to the plaintiffs and counsel to the
defendants in the various class action lawsuits
instituted by certain shareholders of the Company.
(Incorporated by reference to Exhibit 99.01 to the
Company's Current Report on Form 8-K dated (date of
earliest event reported) June 17, 1999, File No.
1-8881)
<PAGE>
CUSIP No. 805844 10 7 13D Page 18 of 18
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: June 23, 1999
/s/ Mario Sbarro
----------------------------------------------------------
Mario Sbarro
/s/ Joseph Sbarro
----------------------------------------------------------
Joseph Sbarro
Joseph Sbarro (1994) Family Limited Partnership
By: /s/ Joseph Sbarro
----------------------------------------------------------
Joseph Sbarro, General Partner
/s/ Anthony Sbarro
----------------------------------------------------------
Anthony Sbarro
/s/ Franklin Montgomery
----------------------------------------------------------
Franklin Montgomery
as co-trustee of the Trust of Carmela Sbarro
Sbarro Merger LLC
By: /s/ Mario Sbarro
----------------------------------------------------------
Mario Sbarro, Member
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
1. Joint Filing Agreement dated as of June 22, 1999 among Mario
Sbarro, Anthony Sbarro, Joseph Sbarro and Franklin Montgomery,
as trustee of the Trust of Carmela Sbarro and Mergeco.
2. Proposal dated November 25, 1998 on behalf of the Reporting
Persons to the Board of Directors of the Company.
3. Amended and Restated Agreement and Plan of Merger dated as of
January 19, 1999 among the Company and the Reporting Persons.
(Incorporated by reference to Exhibit 2 to the Company's
Current Report on Form 8-K dated (date of earliest event
reported) June 17, 1999, File No. 1-8881)
4. Letter dated as of January 19, 1999 from Bear Stearns & Co.
Inc. to the Reporting Persons. (Incorporated by reference to
Exhibit 99.02 to the Company's Current Report on Form 8-K
dated (date of earliest event reported) June 17, 1999, File
No.
1-8881)
5. Stipulation of Settlement dated April 7, 1999 among counsel to
the plaintiffs and counsel to the defendants in the various
class action lawsuits instituted by certain shareholders of
the Company. (Incorporated by reference to Exhibit 99.01 to
the Company's Current Report on Form 8-K dated (date of
earliest event reported) June 17, 1999, File No. 1-8881)
EXHIBIT 1
The undersigned agree that the statement on Schedule 13D to which this
Agreement is attached is filed on behalf of each of them.
Dated: June 23, 1999
/s/ Mario Sbarro
-----------------------------------------------------------
Mario Sbarro
/s/ Joseph Sbarro
-----------------------------------------------------------
Joseph Sbarro
Joseph Sbarro (1994) Family Limited Partnership
By: /s/ Joseph Sbarro
-----------------------------------------------------------
Joseph Sbarro, General Partner
/s/ Anthony Sbarro
-----------------------------------------------------------
Anthony Sbarro
/s/ Franklin Montgomery
-----------------------------------------------------------
Franklin Montgomery
as co-trustee of the Trust of Carmela Sbarro
Sbarro Merger LLC
By: /s/ Mario Sbarro
-----------------------------------------------------------
Mario Sbarro, Member
EXHIBIT 2
THE SBARRO FAMILY
(Mario Sbarro, Joseph Sbarro, Anthony Sbarro
and the Trust of Carmela Sbarro)
c/o Sbarro, Inc.
401 Broad Hollow Road
Melville, NY 11747
November 25, 1998
Board of Directors of Sbarro, Inc.
Gentlemen:
I am pleased to extend a new proposal, on behalf of myself,
Joseph Sbarro, Anthony Sbarro and the Trust of Carmela Sbarro (the
"Sbarro Family"), to acquire all of the outstanding shares of Common
Stock of Sbarro, Inc. (the "Company") not currently owned by the Sbarro
Family (the "Public Shares"). The transaction would be structured as a
cash merger of the Company with a company to be owned by the Sbarro
Family in which each holder of Public Shares would receive $27.50 per
share, or an aggregate of approximately $388 million, based on the
number of Public Shares outstanding as of October 4, 1998.
Consummation of the acquisition would be subject, among other
things, to (i) entering into a definitive merger agreement with the
Company with respect to the transaction, (ii) approval of the
transaction by a special committee of the Company's Board of Directors
(the "Special Committee"), the full Board of Directors and the
Company's shareholders, (iii) receipt of satisfactory financing for the
transaction (the Sbarro family members have been informed by Bear,
Stearns & Co. Inc., that, subject to certain conditions, Bear Stearns
was highly confident that financing for the transaction could be
obtained), (iv) the continued suspension of dividends by the Company
and (v) receipt of a fairness opinion from the financial advisor to the
Special Committee stating that the proposed transaction is fair, from a
financial point of view, to the public shareholders.
We believe that our proposal is beneficial to both the Company
and its public shareholders and is a fair one to the public
shareholders. The proposed acquisition price of $27.50 represents a
premium over today's closing price of the Company's Common Stock on the
New York Stock Exchange of $24.8125.
<PAGE>
We look forward to working with you and the advisors to the
Special Committee to complete this transaction and hope you will give
this proposal your prompt attention. We reserve the right to amend or
withdraw this proposal at any time in our discretion.
Sincerely,
By: /s/ Mario Sbarro
------------------------------
Mario Sbarro, on behalf of
the Sbarro Family
