SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report March 19, 1997
(Date of earliest event reported March 19,1997)
Family Steak Houses of Florida, Inc.
(Exact name of registrant as specified in its charter)
Florida
(State or other jurisdiction of incorporation)
0000784539 59-2597349
(commission file number) (IRS Employer Identification No)
2113 Florida Boulevard, Neptune Beach, Florida 32266
(Address of principal executive offices) (zip code)
Registrant's telephone number,
including area code (904) 249-4197
Item 5. Other events.
Reference is made to Registrant's press release dated March
19, 1997 filed as an exhibit hereto.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
Family Steak Houses of Florida, Inc.
(Registrant)
Date: March 19, 1997 By:/s/ Edward B. Alexander
Print Name: Edward B. Alexander
Its: Chief Financial Officer/Treasurer
Wednesday, March 19, 1997
Board of Family Steak Houses, Inc. Recommends
Rejection of Tender Offer by Bisco Industries, Inc., Adopts
Shareholders Rights Plan and Amends Bylaws
JACKSONVILLE, March 19 -- Family Steak Houses of Florida,
Inc. ("FSH") (NASDAQ: RYFL) announced today that its Board
of Directors recommends that its shareholders reject the
tender offer commenced by Bisco Industries, Inc. ("Bisco")
on March 6, 1997, to purchase up to 2,600,000 shares of
common stock for $.90 per share. After consideration of the
terms and conditions of the tender offer and other relevant
matters, the Board of the Company unanimously determined
that the $.90 per share amount of the offer is inadequate
and the offer is not in the best interests of Family Steak
Houses of Florida, Inc. and its shareholders.
Lewis E. Christman, Jr., President and Chief Executive
Officer of FSH stated, "The Board considered a variety of
factors in making its determination to reject the offer,
including the current market price of FSH's stock, FSH's
current financial condition, its recent refinancing of its
long-term debt and resulting ability to open new
restaurants, the lack of information on Bisco's plans for
FSH, the apparent lack of expertise of Bisco and its
management in FSH's business operations, Bisco's lack of
significant financial resources, the uncertainty expressed
by FSH's franchisor and lender about the possibly disruptive
influence of Bisco on FSH, the structure of the tender
offer, the opinion of those shareholders who have contacted
FSH that the offer price was too low, the range of values
for the Company shown in the valuation study prepared by an
nationally recognized investment banking firm, the impact of
any operational changes instituted by Bisco, which could
include the disposition of restaurants, on the Company's
1,400 employees, customers, suppliers and communities it
serves, and other relevant data. We also considered the
likelihood that the Board could negotiate a more favorable
transaction with another entity or a higher offer price from
Bisco."
The Board's recommendation is discussed in greater detail in
a letter to shareholders and a Schedule 14D-9 that will be
sent to all shareholders of record today.
The tender offer is conditioned upon, among other things,
Bisco being satisfied that Section 607.0902 of the Florida
Business Corporation Act (the "Florida Control Share Act")
shall be inapplicable to the offer or Bisco otherwise being
satisfied that the Florida Control Share Act will not deny
voting rights to shares acquired through the offer. In
connection with its rejection of the tender offer, the Board
determined to take no action to render the Florida Control
Share Act inapplicable.
The Board also determined to accelerate the record date for
a shareholder rights plan previously adopted by the Board,
subject to review and approval by the rights agent, and
declared a dividend of one Right for each outstanding share
of its common stock held as of March 19, 1997.
"The Board has been studying shareholder rights plans and
other methods of protecting shareholders from unfair,
coercive takeover tactics, and had approved adoption of a
rights plan, subject to review and execution by the rights
agent, at its February 1997 Board of Directors meeting",
said Mr. Christman. "In light of the tender offer, the
Board decided to accelerate implementation of the rights
plan. The rights plan is intended to provide the Board with
additional time to negotiate with Bisco, to consider
alternatives to the tender offer, and to insure that any
acquisition of control of the Company occurs on terms that
provide fair value to all shareholders," Christman said.
The rights plan is designed to deter coercive and unfair
takeover tactics and is not intended to prevent an
acquisition of FSH on terms that represent fair value to all
shareholders. It will be described in greater detail in a
letter that will be sent to all shareholders of record as of
March 19, 1997.
Under the plan, each share of FSH common stock will have
Rights attached to such shares. Until the Distribution Date
(as defined below), the Rights will be transferred with and
only with the shares of common stock. Separate certificates
for the Rights will be issued as soon as practicable
following the Distribution Date to holders of record of the
common stock as of the Distribution Date. The Rights will
be exercisable and will trade separately from the Common
Stock upon the earlier to occur of the following (a
"Distribution Date"):
(a) The tenth business day after the date of public
announcement that a person or group of affiliated or
associated persons have become the beneficial owners of 15%
or more of the outstanding shares of FSH common stock or
voting securities representing 15% or more of the total
voting power (such a person is defined as an "Acquiring
Person"), or
(b) The tenth business day or such later date
determined by the Board of Directors after the first public
announcement of a tender or exchange offer, which, upon
consummation, would result in a person or a group being the
beneficial owner of 15% or more of the outstanding shares
of common stock (or 15% or more of the total voting power),
or
(c) The tenth business day after a majority of the
Board who are not officers of FSH have determined that a
person is an Adverse Person (which is defined in the rights
agreement).
In light of the tender offer filed by Bisco on March 6,
1997, the Board elected to postpone the Distribution Date
which would have otherwise been triggered under paragraph
(b) above until April 15, 1997.
If (i) a person becomes the beneficial owner of 15% or more
of the then outstanding shares of FSH common stock or voting
power (except pursuant to certain business combinations or
an offer for all outstanding shares of FSH common stock and
all other voting securities which the independent and
disinterested directors of FSH determine to be fair to and
otherwise in the best interests of FSH and its shareholders)
or (ii) any person is determined to be an Adverse Person
(either (i) or (ii) being a "Flip-in Event"), each holder of
a Right (with the exception of an Adverse or Acquiring
Person) will thereafter have the right to receive, upon
exercise, FSH common stock having a value equal to no less
than two times the exercise price of the Right, which is
$5.00, subject to adjustment. However, Rights are not
exercisable following the occurrence of a Flip-in Event
until such time as the Rights are no longer redeemable by
FSH.
In the event of certain business combinations involving FSH,
each holder of a Right may receive, upon exercise, common
stock of the acquiring company having a value equal to two
times the exercise price of the Right.
FSH may redeem each Right for $0.001 at any time before the
earliest of (i) the tenth (10th) business day after a person
or group becomes an Acquiring Person, (ii) the tenth (10th)
business day after the Board's determination that a person
is an Adverse Person, or (iii) March 17, 2007.
In addition to adoption of the rights plan, the Board of
Directors adopted certain revisions to FSH's bylaws to
institute a classified Board of Directors, to impose certain
timing and notice requirements on proposals and director
nominations made by shareholders and to authorize FSH to
appoint inspectors of elections and consents to determine
the validity and effect of shareholder votes, proxies,
consents and revocations of consent. These bylaw revisions
are intended to provide FSH with additional notice of, and
help protect FSH from, coercive tactics proposed by persons
trying to exert control over the Company.
Family Steak Houses of Florida, Inc., is a Florida
corporation, with corporate offices located in Jacksonville,
Florida. FSH is the exclusive franchisee for Ryan's Family
Steak Houses in North and Central Florida. FSH presently
operates 25 Ryan's restaurants in Florida, including seven
in the Jacksonville area.
CONTACT: Edward Alexander, Family Steak Houses of Florida,
Inc., (904) 249-4197.
