<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy statement pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[x] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
PRANDIUM, INC.
--------------
(Name of Registrant as Specified in Its Charter)
- ---------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[x] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(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 (set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] 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:
<PAGE>
[LOGO OF PRANDIUM(TM), INC. APPEARS HERE]
PRANDIUM, INC.
18831 Von Karman Avenue
Irvine, California 92612
Dear Stockholder:
On behalf of our Board of Directors, I cordially invite you to attend
Prandium, Inc.'s 1999 Annual Meeting of Stockholders to be held at the
Hyatt Regency Irvine Hotel, 17900 Jamboree Road, Irvine, California 92617,
on Friday, June 11, 1999 at 10:00 a.m. local time.
As you likely know by now, we recently changed the name of Koo Koo Roo
Enterprises, Inc. to Prandium, Inc. Each outstanding certificate
representing shares of Koo Koo Roo Enterprises, Inc. common stock will
continue to represent the same number of shares of Prandium, Inc. common
stock. Thus, it will not be necessary for you to exchange your existing
stock certificates for stock certificates of Prandium, Inc. You can read
more about the name change on the inside cover of our 1998 Annual Report.
The attached Proxy Statement describes in detail the matters expected to
be acted upon at the meeting, including electing six directors, all of
whom are present directors of the Company, and ratifying the selection of
KPMG LLP as the Company's independent public accountants. Following the
meeting, we will also report on the Company's progress and respond to
questions you may have about the Company's business.
We hope that you will be able to attend and participate in the meeting.
Whether or not you plan to attend, it is important that your shares be
represented and voted at the meeting. Please complete, sign, date and
return the accompanying proxy card as promptly as possible. If you attend
the meeting, you may vote in person even if you previously have mailed
your proxy card. Your proxy is revocable in accordance with the procedures
set forth in the Proxy Statement.
Sincerely,
/s/ Kevin S. Relyea
---------------------
Kevin S. Relyea
Chairman of the Board
Irvine, California
April 19, 1999
<PAGE>
[LOGO OF PRANDIUM(TM), INC. APPEARS HERE]
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On June 11, 1999
----------------
To the Stockholders of Prandium, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of Prandium, Inc., a Delaware corporation (the "Company"), will be
held at the Hyatt Regency Irvine Hotel, 17900 Jamboree Road, Irvine,
California 92617, on Friday, June 11, 1999 at 10:00 a.m. local time for the
following purposes:
1. To elect six directors to serve until the next annual meeting of
stockholders and until their successors are duly elected and qualified;
2. To ratify the selection of KPMG LLP as the Company's independent
accountants for the Company's fiscal year ending December 26, 1999; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on April 13, 1999 as
the record date for the determination of stockholders entitled to notice of
and to vote at the Annual Meeting and any adjournment or postponement thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. Stockholders of record as of the record date will be admitted to the
Annual Meeting upon presentation of identification. Stockholders who own
shares of the Company's common stock beneficially through a bank, broker or
other nominee will be admitted to the Annual Meeting upon presentation of
identification and proof of ownership or a valid proxy signed by the record
holder. A recent brokerage statement or a letter from a bank or broker are
examples of proof of ownership. Any other persons will be admitted at the
discretion of the Company, as seating is limited.
Whether or not you plan to attend the Annual Meeting, you are urged to read
the Proxy Statement and then complete, sign and date the enclosed proxy card
and return it as promptly as possible in the enclosed, postage-prepaid
envelope to ensure the presence of a quorum for the meeting. Even if you have
given your proxy, you may still vote in person if you attend the Annual
Meeting. Please note, however, that if your shares are held of record by a
broker, bank or other nominee, and you wish to vote at the meeting, you must
obtain from the record holder a proxy issued in your name.
By Order of the Board of Directors
/s/ Todd E. Doyle
----------------------------------
Todd E. Doyle
Executive Vice President, General
Counsel and Secretary
Irvine, California
April 19, 1999
<PAGE>
PRANDIUM, INC.
18831 Von Karman Avenue
Irvine, California 92612
----------------
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
to be held
June 11, 1999
INFORMATION CONCERNING SOLICITATION AND VOTING
General
This Proxy Statement is furnished and the enclosed proxy is solicited on
behalf of the Board of Directors of Prandium, Inc., a Delaware corporation
(the "Company"), for use at the Annual Meeting of Stockholders to be held on
Friday, June 11, 1999, at 10:00 a.m. local time (the "Annual Meeting"), or at
any adjournment or postponement thereof, for the purposes set forth herein and
in the accompanying Notice of Annual Meeting. The Annual Meeting will be held
at the Hyatt Regency Irvine Hotel, 17900 Jamboree Road, Irvine, California
92617. The Company intends to first mail this Proxy Statement and accompanying
proxy card to all stockholders entitled to vote at the Annual Meeting on or
about April 27, 1999.
The stockholders of the Company will consider and vote upon the following
proposals:
(1) the election of six directors to serve until the next annual meeting of
stockholders and until their successors are duly elected and qualified;
(2) the ratification of the selection of KPMG LLP as the Company's
independent accountants for the Company's fiscal year ending December 26,
1999; and
(3) such other business as may properly come before the Annual Meeting or
any adjournment or postponement thereof.
Solicitation
The Company will bear the entire cost of solicitation of proxies including
preparation, assembly, printing and mailing of this Proxy Statement, the proxy
and any additional information furnished to stockholders. Copies of
solicitation materials will be furnished to banks, brokerage houses,
fiduciaries and custodians holding in their names shares of Common Stock, par
value $.01 per share of the Company (the "Common Stock"), beneficially owned
by their customers or principals to forward to such beneficial owners. The
Company may reimburse persons representing beneficial owners of Common Stock
for their costs of forwarding solicitation materials to such beneficial
owners. Original solicitation of proxies by mail may be supplemented by
telephone, telegram, facsimile or personal solicitation by the directors,
officers or other regular employees of the Company and its affiliates. No
additional compensation will be paid to the directors, officers or other
regular employees for such services.
Voting Rights and Outstanding Shares
Only the holders of record of Common Stock at the close of business on April
13, 1999 (the "Record Date") are entitled to receive notice of, and to vote
at, the Annual Meeting. Each share of Common Stock entitles the holder thereof
to one vote. Stockholders are not permitted to cumulate their shares of Common
Stock for the purpose of electing directors or otherwise. At the close of
business on the Record Date, there were 180,380,513 shares of Common Stock
issued and outstanding.
The presence at the Annual Meeting, either in person or by proxy, of
stockholders entitled to cast a majority of all votes entitled to be cast at
the Annual Meeting constitutes a quorum for the transaction of business at the
Annual Meeting.
<PAGE>
All properly executed written proxy cards that are delivered pursuant to the
solicitation (and not later revoked) will be voted at the Annual Meeting in
accordance with the instructions given in the proxy. If a written proxy card
is signed by a registered stockholder and returned without instructions, the
shares will be voted in accordance with the Board of Directors' recommendation
as set forth herein with respect to the proposals. Voting your proxy by mail
will not limit your right to vote at the Annual Meeting if you decide later to
attend in person. If your shares are held in the name of a broker, bank or
other record holder, you must either direct the record holder as to how to
vote your shares or obtain a proxy from the record holder to vote at the
Annual Meeting. Under Delaware law, shares represented by proxy that reflect
abstentions or "broker non-votes" (i.e., shares held by a broker or nominee
that are represented at the Annual Meeting, but with respect to which such
broker or nominee is not empowered to vote on a particular proposal) will be
counted as shares that are present and entitled to vote for purposes of
determining the presence of a quorum. The affirmative vote of the holders of
at least a majority of the voting power of the Common Stock present in person
or represented by proxy at the Annual Meeting is required to approve each of
the proposals. Abstentions and broker non-votes will not count as votes for or
against proposals acted on at the Annual Meeting.
The Board of Directors knows of no matters to come before the Annual Meeting
other than the matters referred to in this Proxy Statement. If, however, any
matters properly come before the Annual Meeting, it is the intention of each
of the persons named in the accompanying proxy to vote such proxies in
accordance with such person's discretionary authority to act in such person's
best judgment.
Revocability of Proxies
Any person giving a proxy pursuant to this solicitation has the power to
revoke it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive offices, 18831
Von Karman Avenue, Suite 300, Irvine, California 92612, a written notice of
revocation, or a duly executed proxy bearing a later date, or it may be
revoked by attending the Annual Meeting and voting in person. Attendance at
the Annual Meeting will not, by itself, revoke a proxy.
2
<PAGE>
PROPOSAL NUMBER ONE
ELECTION OF DIRECTORS
The Company's Sixth Amended and Restated Certificate of Incorporation, as
amended (the "Certificate of Incorporation"), and Second Amended and Restated
Bylaws (the "Bylaws") provide that the Board of Directors shall be elected by
the stockholders at each annual meeting of stockholders, and each director so
elected shall hold office until such director's successor is duly elected and
qualified, or until such director's death, or until such director's earlier
resignation or removal.
The Company's Certificate of Incorporation provides that the number of
directors that shall constitute the whole Board of Directors shall be fixed
exclusively by one or more resolutions adopted from time to time by the Board
of Directors. The authorized number of directors is currently set at six and
there are no vacancies with respect thereto.
If any nominee should become unavailable for election as a result of any
unexpected occurrence, such shares will be voted for the election of such
substitute nominee as management may propose. Each person nominated for
election has agreed to serve if elected, and management has no reason to
believe that any nominee will be unavailable to serve. If elected at the
Annual Meeting, each of the six nominees would serve until the annual meeting
to be held in the year 2000, in each case until their successor is elected and
has qualified, or until such director's earlier death, resignation or removal.
The following six persons have been selected by the Board of Directors as
nominees for election to the Board of Directors: Kevin S. Relyea, A. William
Allen, III, Peter P. Copses, George G. Golleher, David B. Kaplan and Antony P.
Ressler. All of the nominees are incumbent directors.
Certain Information Regarding Nominees
See "Board of Directors and Executive Officers" for the experience and
background of each of the nominees.
Vote Required
The affirmative vote of the holders of a majority of votes cast at the
Annual Meeting will be required to elect each director. Under applicable
Delaware law, in tabulating the vote, broker non-votes and abstentions will be
disregarded and will have no effect on the outcome of the vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
IN FAVOR OF EACH OF THE ABOVE-NAMED NOMINEES.
3
<PAGE>
PROPOSAL NUMBER TWO
RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors has selected and approved KPMG LLP as the Company's
independent accountants for the Company's fiscal year ending December 26, 1999
(the "1999 Fiscal Year"), and has further directed that management submit the
selection of independent accountants for ratification by the stockholders at
the Annual Meeting. KPMG LLP has audited the Company's financial statements
since 1994. Representatives of KPMG LLP are expected to be present at the
Annual Meeting, will make a statement if they so desire, and will be available
to respond to appropriate questions.
Vote Required
Stockholder ratification of the selection of KPMG LLP as the Company's
independent accountants is not required by the Company's Bylaws or otherwise.
However, the Board of Directors is submitting the selection of KPMG LLP to the
stockholders for ratification as a matter of good corporate practice. If the
stockholders fail to ratify the selection, the Board of Directors and the
Audit Committee will reconsider whether or not to retain that firm. Even if
the selection is ratified, the Board of Directors and the Audit Committee in
their discretion may direct the appointment of a different independent
accounting firm at any time during the 1999 Fiscal Year if they determine that
such a change would be in the best interests of the Company and its
stockholders.
The affirmative vote of the holders of a majority of votes cast at the
Annual Meeting will be required to ratify the selection of KPMG LLP as the
Company's independent accountants for the 1999 Fiscal Year. Under applicable
Delaware law, in tabulating the vote, broker non-votes and abstentions will be
disregarded and will have no effect on the outcome of the vote.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL NUMBER TWO.
4
<PAGE>
BOARD OF DIRECTORS AND EXECUTIVE OFFICERS AND SENIOR MANAGEMENT
Directors, Executive Officers and Senior Management
The following table sets forth certain information with respect to the
Directors, executive officers and senior management of the Company as of the
Record Date:
<TABLE>
<CAPTION>
Name Age Position With Company
---- --- ---------------------
<C> <C> <S>
Kevin S. Relyea................ 44 President, Chief Executive Officer and
Chairman of the Board
A. William Allen, III.......... 39 Director
Peter P. Copses................ 40 Director
David B. Kaplan................ 31 Director
George G. Golleher............. 51 Director
Antony P. Ressler.............. 38 Director
William D. Burt................ 46 Executive Vice President, President of El
Torito Restaurants, Inc.
Roger K. Chamness.............. 46 Executive Vice President, President of Chi-
Chi's, Inc.
Gayle A. DeBrosse.............. 41 Executive Vice President, President of Koo
Koo Roo, Inc.
Robert T. Trebing, Jr.......... 49 Executive Vice President and Chief Financial
Officer
Michael E. Malanga............. 45 Executive Vice President, Corporate
Development
Todd E. Doyle.................. 37 Executive Vice President, General Counsel and
Secretary
Robert D. Gonda................ 47 Vice President and Treasurer
Janie M. Bereczky.............. 43 Vice President, Taxes
</TABLE>
Kevin S. Relyea became a director in December 1995. In June 1998, Mr.
Relyea became Chairman of the Board. Mr. Relyea has served as Chief Executive
Officer since December 1995 and as President since August 1995. Mr. Relyea
joined the Company in January 1994 as Executive Vice President and President
of the Family Restaurant Division. From 1988 to January 1994, Mr. Relyea had
been Regional Vice President of the Jack in the Box operations for Foodmaker,
Inc. ("Foodmaker"). Mr. Relyea received an M.B.A. from Pepperdine University
in 1988.
A. William Allen, III has served as a director of the Company since October
1998. Mr. Allen previously served as Chief Executive Officer and Director of
Koo Koo Roo, Inc. from March 1998 until October 1998. Prior to his affiliation
with Koo Koo Roo, Inc., Mr. Allen spent seven years as CEO/President of La
Madeleine, a chain of upscale quick-service restaurants. Mr. Allen began his
career with Marriott Corporation in 1979, progressing to the position of
Senior Area Vice President of West Coast operations. Mr. Allen is currently
the Chief Executive Officer and a partner of Fleming's Pacific Steak House.
Peter P. Copses has served as a director since January 1994. Since 1990, Mr.
Copses has been a principal of Apollo Advisors, L.P. ("Apollo") which,
together with its affiliates, serves as managing general partner of the Apollo
investment funds, and of Lion Advisors, L.P., which serves as financial
advisor to certain institutional investors with respect to securities
investments. From March to September 1990, Mr. Copses was a Vice President in
the investment banking department of Donaldson, Lufkin & Jenrette Securities
Corporation. Prior to 1990, he was employed by Drexel Burnham Lambert
Incorporated. Mr. Copses is also a director of Mariner-Post Acute Network,
Inc., Rent-A-Center, Inc. and Zale Corporation.
David B. Kaplan has served as a director since December 1996. Since 1991,
Mr. Kaplan has been associated with and is a limited partner of Apollo which,
together with its affiliates, serves as managing general partner of the Apollo
investment funds. Prior to 1991, Mr. Kaplan was a member of the Investment
Banking Department of Donaldson, Lufkin & Jenrette Securities Corporation. Mr.
Kaplan is also a director of Allied Waste Industries, Inc. and WMC Finance Co.
George G. Golleher became a director in December 1998. Mr. Golleher has
served as President and Chief Operating Officer of Fred Meyer, Inc. since
March 1998. Mr. Golleher was Chief Executive Officer of Ralphs
5
<PAGE>
Grocery Company ("Ralphs") since January 1996 and was Vice Chairman from June
1995 to January 1996. Mr. Golleher was a director of Food 4 Less Supermarkets
since its inception in 1989 and was the President and Chief Operating Officer
of Food 4 Less Supermarkets from January 1990 until its merger with Ralphs.
Mr. Golleher is also a director of Fred Meyer, Inc., American Restaurant Group
and Santee Dairies.
Antony P. Ressler has served as a director since January 1994. Mr. Ressler
is one of the founding principals of Apollo Advisors, L.P., Lion Advisors,
L.P., and Ares Management, L.P., which, together with their affiliates, act as
financial advisor to and representative for certain institutional investors
with respect to securities investments. Mr. Ressler is also a director of
Allied Waste Industries, Inc., United International Holdings, Inc., Vail
Resorts, Inc. and Berlitz International, Inc.
William D. Burt has served as Executive Vice President of the Company and
President of El Torito Restaurants, Inc. since he joined the Company on April
8, 1996. Prior to joining the Company, Mr. Burt was the Vice President of
Operations at the Krystal Company from 1995 to 1996, and an Executive Vice
President at Taco Cabana from 1994 to 1995. Prior to 1994, Mr. Burt spent 23
years with Foodmaker. Mr. Burt received his M.B.A. from Pepperdine University
in 1988.
Roger K. Chamness has served as Executive Vice President since December 1995
and President of Chi-Chi's, Inc. since March 1996. Mr. Chamness joined the
Company at its inception. His previous position was Executive Vice President
of Finance and Administration for the Family Restaurant Division which he held
from October 1995 until June 1996. Mr. Chamness received a B.A. in Business
Economics from UCLA in 1975 and an M.B.A. in Finance and International
Business from UCLA in 1980.
Gayle A. DeBrosse serves as Executive Vice President of the Company and
President of Koo Koo Roo, Inc., and has so served since November 1998. She
joined the Company in December 1994 as a Vice President and later held the
position of Senior Vice President, Quality Assurance and Product Safety,
Purchasing and Distribution, Public Affairs. Prior to joining the Company, she
was Director of Product Development and Continuous Improvement at Taco Bell
from 1991 until 1994 and Director, Research and Development for Flagstar from
1982 to 1991. Ms. DeBrosse received a B.S. in Nutritional Sciences from
Arizona State University in 1979 and an M.S. in Agribusiness with Emphasis in
Food Science, Quality Assurance and Food Chemistry from Arizona State
University in 1982.
Robert T. Trebing, Jr. serves as Executive Vice President and Chief
Financial Officer and has so served since April 1997. He joined the Company at
its inception and has held the positions of Senior Vice President and Chief
Financial Officer, Senior Vice President of Finance, Vice President of
Finance, Vice President and Controller and Manager of Financial Reporting. Mr.
Trebing is a Certified Public Accountant. Mr. Trebing received a B.A. from
California State University at Fullerton in 1972 and an M.B.A. from the
University of Southern California in 1973.
Michael E. Malanga serves as Executive Vice President, Corporate
Development. He joined the Company at its inception as Director of Mergers and
Acquisitions and has held the positions of Vice President and Senior Vice
President. He was promoted to his current position in March 1998. Mr. Malanga
received a B.S. in Business Administration from the University of Southern
California in 1976.
Todd E. Doyle serves as Executive Vice President, General Counsel and
Secretary of the Company and has so served since October 1998. He joined the
Company as Legal Counsel in 1992 and has also held the positions of Senior
Legal Counsel and Vice President. Prior to joining the Company, Mr. Doyle
spent six years as a business transactional attorney and a business litigation
attorney with Seltzer Caplan Wilkins & McMahon in San Diego, California. Mr.
Doyle received a B.A. in Political Science and a B.A. in Sociology from the
University of California, Santa Barbara in 1983, and received a J.D. from
Loyola Law School, Los Angeles, California in 1986.
Robert D. Gonda serves as Vice President and Treasurer of the Company and
has so served since December 1998. He joined the Company at its inception and
has held the positions of Treasurer, Assistant Treasurer, and Director of
Financial Planning and Analysis. Mr. Gonda is a Certified Cash Manager. Mr.
Gonda received a B.A. in Political Science and Economics from the State
University of New York at Binghamton and an M.B.A. in Finance from Columbia
University Graduate School of Business.
6
<PAGE>
Janie M. Bereczky serves as Vice President, Taxes and has so served since
August 1992. She joined the Company in 1987 as Director of Taxes. Ms. Bereczky
has been a Certified Public Accountant since 1981. Ms. Bereczky received a
B.A. in Political Science from the University of California, Santa Barbara in
1978 and an M.B.A. in Taxation from Golden Gate University in 1985.
Information Regarding Meetings and Committees of the Board of Directors
During the fiscal year ended December 27, 1998 (the "1998 Fiscal Year"), the
Board of Directors held seven regular meetings, two special meetings and acted
five times by unanimous written consent. During the 1998 Fiscal Year, each
member of the Board of Directors attended at least 75% of the aggregate number
of the meetings of the board and meetings of the Committee on which they
served. In November 1998, the Board created an Audit Committee, a Compensation
Committee, and an Executive Committee. The Company does not have a standing
Nominating Committee.
Audit Committee. The Audit Committee held one meeting in the 1998 Fiscal
Year to review the Company's outside auditors' client service plan for its
year-end audit strategy. The Audit Committee is currently composed of Messrs.
Golleher, Kaplan and Allen. Among other things, the Audit Committee discusses
the scope and results of the audit with the independent public accountants,
reviews with management and the independent public accountants the Company's
interim and year-end operating results, considers the adequacy of the internal
accounting controls and audit procedures of the Company and reviews any non-
audit services to be performed by the independent public accountants.
Compensation Committee. The Compensation Committee did not meet during the
1998 Fiscal Year. The Compensation Committee makes recommendations concerning
salaries and incentive compensation for the Company's management, and
otherwise determines compensation levels and performs such other functions
regarding compensation as the Board may delegate. The Compensation Committee
is currently composed of Messrs. Allen, Kaplan and Ressler.
Executive Committee. The Executive Committee did not meet in the 1998 Fiscal
Year. The Executive Committee is authorized to perform such functions as may
be delegated by the Board of Directors. The Executive Committee is currently
composed of Messrs. Copses, Kaplan and Relyea.
Compensation of Directors
Prior to November 1998, no compensation was paid to non-employee directors
of the Company. Effective November 1998, each non-employee director of the
Company receives a quarterly fee of $6,250 for his or her services to the
Company. Employee directors do not receive any compensation for their service
on the Board of Directors or any Committee meetings thereof. Each non-employee
director is reimbursed for reasonable expenses incurred to attend director and
Committee meetings.
Effective November 1998, non-employee directors of the Company were eligible
to receive stock option grants under the Company's 1998 Stock Incentive Plan.
Under the Company's 1998 Stock Incentive Plan, in November 1998 each non-
employee director, other than Mr. Lee Iacocca, was granted an option to
purchase 50,000 shares of the Company's Common Stock. Mr. Iacocca, was granted
an option to purchase 250,000 shares of the Company's Common Stock. In
addition, subsequent to the 1998 Fiscal Year, following his election to the
Board of Directors in December 1998. Mr. Golleher was granted an option to
purchase 50,000 shares of Common Stock under the Company's 1998 Stock
Incentive Plan. The options that were granted to the non-employee directors
have exercise prices equal to the fair market value of the underlying Common
Stock on the date of grant and are fully vested.
Compensation Committee Interlocks and Insider Participation
During the 1998 Fiscal Year, Messrs. Allen, Kaplan and Ressler served on the
Compensation Committee. No member of the Compensation Committee has served as
an officer of the Company or any of its subsidiaries. Mr. Allen served as the
Chief Executive Officer and President of Koo Koo Roo, Inc. prior to the date
it became a subsidiary of the Company.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of the Record Date by: (i) each of
the Company's directors; (ii) each of the Named Executive Officers (as such
term is defined under "Executive Compensation"); (iii) all Named Executive
Officers and directors of the Company as a group; and (iv) all those known by
the Company to be beneficial owners of more than five percent of its Common
Stock (the "Principal Stockholders"). This table is based on information
provided to the Company or filed with the Securities and Exchange Commission
(the "Commission") by the Company's directors, Named Executive Officers and
Principal Stockholders. Except as otherwise indicated, the Company believes
that the beneficial owners of the Common Stock listed below, based on
information furnished by such owners, have sole investment and voting power
with respect of such shares, subject to community property laws where
applicable. Applicable percentages are based on 180,380,513 shares outstanding
as of the Record Date, adjusted as required by rules promulgated by the
Commission.
<TABLE>
<CAPTION>
Amount and
Nature of
Beneficial Percent
Name and Address of Beneficial Owner (1) Ownership(2) of Class
---------------------------------------- ------------ --------
<S> <C> <C>
Kevin S. Relyea.................................... 2,836,562 1.6%
A. William Allen, III.............................. 569,200 *
Peter P. Copses.................................... 210,114(3) *
George G. Golleher................................. 50,000 *
David B. Kaplan.................................... 101,036(3) *
Antony P. Ressler.................................. 832,569(3)(4) *
William D. Burt.................................... 563,767 *
Roger K. Chamness.................................. 1,624,999 *
Gayle A. DeBrosse.................................. 295,277 *
Robert T. Trebing, Jr.............................. 471,575 *
AIF II, L.P........................................ 97,918,477(3)(5) 54.3%
2 Manhattanville Road
Purchase, NY 10577
Green Equity Investors, L.P........................ 19,700,257 10.9%
11111 Santa Monica Blvd., Suite 2000
Los Angeles, CA 90025
All Named Executive Officers and Directors as a
Group (14 persons)................................ 8,347,088 4.6%
</TABLE>
- --------
* Less than 1%
(1) Unless otherwise indicated, the business address of each stockholder
listed above is c/o the Company at 18831 Von Karman Avenue, Suite 300,
Irvine, California 92612.
(2) Includes shares issuable upon exercise of options exercisable within 60
days of April 13, 1999, as follows: Mr. Relyea, 1,797,585 shares; Mr.
Allen, 569,200 shares; Mr. Copses, 50,000 shares; Mr. Golleher, 50,000
shares; Mr. Kaplan, 50,000 shares; Mr. Ressler, 50,000 shares; Mr. Burt,
523,499 shares; Mr. Chamness, 1,342,201 shares; Ms. DeBrosse, 233,800
shares; Mr. Trebing, 360,915 shares; and all directors and executive
officers as a group, 5,659,409 shares.
(3) Messrs. Copses, Kaplan and Ressler are officers of Apollo Capital (as
defined). Each of Messrs. Copses, Kaplan and Ressler and the directors of
Apollo Capital disclaim beneficial ownership of all shares beneficially
held by AIF II, L.P. and Lion Advisors, L.P.
(4) Includes 782,569 shares held in a private charitable foundation.
(5) Includes 2,086,480 shares beneficially owned by Lion Advisors, L.P. for the
benefit of an investment account under management over which Lion Advisors,
L.P. has investment/dispositive power. The managing general partner of AIF
II, L.P. is Apollo Advisors, L.P. Lion Advisors, L.P. is an affiliate of
Apollo Advisors, L.P. The general partner of Apollo Advisors, L.P. is
Apollo Capital Management, Inc. ("Apollo Capital").
8
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and executive officers, and persons who own more than
10 percent of a registered class of the Company's equity securities to file
with the Commission initial reports of ownership and changes of reports in
ownership of Common Stock and other equity securities of the Company.
Officers, directors and greater-than-10-percent stockholders are required by
Commission regulations to furnish the Company with copies of all Section 16(a)
forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the 1998 Fiscal Year, all Section 16(a) filing
requirements applicable to its officers, directors and greater-than-ten-
percent beneficial owners were timely met, except that the filing of one
report by Green Equity Investors, L.P. on Form 3, relating to a single
transaction, was late.
9
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth, in summary form, for each of the fiscal
years ended December 27, 1998, December 28, 1997 and December 29, 1996,
compensation paid by the Company to the individual who served as its Chief
Executive Officer, and the four other most highly compensated executives (the
"Named Executive Officers").
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
----------------------------------------------- ------------
Securities
Name and Principal Other Annual Underlying All Other
Position Year Salary($) Bonus($) Compensation($) Options(#) Compensation($)
------------------ ---- --------- --------- --------------- ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Kevin S. Relyea, 1998 420,000 1,274,414(1) -- 4,182,253 4,378(2)
Chairman of the Board, 1997 400,000 192,000 -- -- 4,226
President and Chief 1996 390,385 1,172,057(3) -- -- 4,145
Executive Officer
William D. Burt, 1998 236,250 503,948(4) -- 1,608,499 6,208(5)
Executive Vice 1997 225,000 180,000 -- -- 3,372
President and 1996(6) 159,635 180,000 86,762(7) -- 1,822
President of El
Torito Restaurants,
Inc.
Roger K. Chamness, 1998 288,750 870,366(8) -- 2,156,132 3,976(9)
Executive Vice 1997 275,000 99,000 -- -- 3,214
President and President 1996 256,940 590,856(10) 69,958(11) -- 2,982
of Chi-Chi's, Inc.
Gayle A. DeBrosse, 1998 163,444 222,250(12) -- 1,133,800 1,904(13)
Executive Vice 1997 148,394 51,826 -- -- 1,679
President and President 1996 134,905 67,233 -- -- 1,427
of Koo Koo Roo, Inc.
Robert T. Trebing, Jr., 1998 191,064 265,717(14) -- 511,733 1,158(15)
Executive Vice 1997 185,321 64,654 -- -- 1,116
President, Chief 1996 174,806 287,031(16) -- -- 858
Financial Officer
</TABLE>
- --------
(1) Mr. Relyea received $201,600 pursuant to the Company's 1998 Management
Incentive Compensation Plan bonus program and $1,072,814 in connection
with the termination of the Company's Value Creation Units Plan.
(2) Mr. Relyea received $918 representing the imputed value of life insurance
provided by the Company and $3,460 representing the Company's matching
funds under its Deferred Compensation Plan.
(3) Mr. Relyea received $320,000 pursuant to the Company's 1996 Management
Incentive Compensation Plan bonus program; $548,461 pursuant to the
Company's Divestiture Bonus Plan; and $303,596 in connection with the
cancellation of Mr. Relyea's stock purchase loan with the Company.
(4) Mr. Burt received $170,100 pursuant to the Company's 1998 Management
Incentive Compensation Plan bonus program and $333,848 in connection with
the termination of the Company's Value Creation Units Plan.
(5) Mr. Burt received $1,549 representing the imputed value of life insurance
provided by the Company and $4,659 representing the Company's matching
funds under its Deferred Compensation Plan.
(6) The amount set forth in the table for fiscal 1996 for Mr. Burt represents
less than a full year's compensation. Mr. Burt joined the Company on
April 8, 1996.
(7) Mr. Burt received $9,000 representing the value of automobile benefits
and $77,762 representing relocation expenses.
(8) Mr. Chamness received $69,300 pursuant to the Company's 1998 Management
Incentive Compensation Plan bonus program and $801,066 in connection with
the termination of the Company's Value Creation Units Plan.
10
<PAGE>
(9) Mr. Chamness received $1,566 representing the imputed value of life
insurance provided by the Company and $2,410 representing the Company's
matching funds under its Deferred Compensation Plan.
(10) Mr. Chamness received $220,000 pursuant to the Company's 1996 Management
Compensation Plan bonus program; $241,323 pursuant to the Company's
Divestiture Bonus Plan; and $129,533 in connection with the cancellation
of Mr. Chamness's stock purchase loan with the Company.
(11) Mr. Chamness received $1,600 representing the value of automobile
benefits and $68,358 representing relocation expenses.
(12) Ms. DeBrosse received $73,150 pursuant to the Company's 1998 Management
Incentive Compensation Plan bonus program and $149,100 in connection with
the termination of the Company's Value Creation Units Plan.
(13) Ms. DeBrosse received $581 representing the imputed value of life
insurance provided by the Company and $1,323 representing the Company's
matching funds under its Deferred Compensation Plan.
(14) Mr. Trebing received $66,917 pursuant to the Company's 1998 Management
Incentive Compensation Plan bonus program and $198,800 in connection with
the termination of the Company's Value Creation Units Plan.
(15) Amount shown represents the imputed value of life insurance provided by
the Company.
(16) Mr. Trebing received $87,500 pursuant to the Company's 1996 Management
Incentive Compensation Plan bonus program; $134,765 pursuant to the
Company's Divestiture Bonus Plan; and $64,766 in connection with the
cancellation of Mr. Trebing's stock purchase loan with the Company.
Stock Option Grants in the 1998 Fiscal Year
The following table sets forth information regarding options granted to the
Company's Named Executive Officers during the 1998 Fiscal Year to purchase
shares of the Company's Common Stock.
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rates of
Individual Grants Stock Option Term
-------------------------------------------------- --------------------------
Number of % of Total
Securities Options
Underlying Granted to
Options Employees in Exercise Expiration
Name Granted (#) Fiscal Year (%) Price ($) Date 0% ($) 5% ($) 10% ($)
---- ----------- --------------- --------- ---------- ------ --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Kevin S. Relyea......... 2,500,000(1) 13.2% .875 11/9/08 0 1,375,707 3,486,312
1,682,253(2) 8.8% .50 12/9/03 50,486 299,375 598,046
William D. Burt......... 1,085,000(1) 5.7% .875 11/9/08 0 597,057 1,513,059
523,499(2) 2.7% .50 12/9/03 16,333 93,162 186,105
Roger K. Chamness....... 900,000(1) 4.7% .875 11/9/08 0 495,255 1,255,072
1,256,132(2) 6.6% .50 12/9/03 39,191 223,542 446,559
Gayle A. DeBrosse....... 900,000(1) 4.7% .875 11/9/08 0 495,255 1,255,072
233,800(2) 1.2% .50 12/9/03 7,295 41,607 83,117
Robert T. Trebing, Jr... 200,000(1) 1.0% .875 11/9/08 0 110,057 278,905
311,733(2) 1.6% .50 12/9/03 9,726 55,476 110,822
</TABLE>
- --------
(1) Messrs. Relyea, Burt, Chamness and Trebing and Ms. DeBrosse received
options constituting incentive stock options to the extent permitted
under applicable law to purchase shares of Common Stock under the
Company's 1998 Stock Incentive Plan. The options are subject to a four-
year vesting period such that one-fourth of such options vest on each of
the first four anniversaries of the date of grant. The options have a
term of ten years. The exercise price is equivalent to the Fair Market
Value (as defined in the plan) of the Common Stock on the date of grant.
(2) Messrs. Relyea, Burt, Chamness and Trebing and Ms. DeBrosse received non-
qualified Stock Options to purchase shares of Common Stock under the
Company's 1998 Stock Incentive Plan. The options have a term of five
years, are fully vested, and became exercisable on March 9, 1999.
11
<PAGE>
Aggregated Option Exercises in Last Fiscal Year and Year-end Option Values
<TABLE>
<CAPTION>
Number of Securities Underlying
Unexercised Options Held at Value of Unexercised In-the-Money
Fiscal Year-End 1998 Options at Fiscal Year-End 1998(1)
-------------------------------- ---------------------------------------
Name Exercisable(#) Unexerciseable(#) Exercisable($) Unexerciseable($)
---- -------------- ----------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Kevin S. Relyea......... 115,332 4,182,253 6,704 105,141
William D. Burt......... -- 1,608,499 0 32,719
Roger K. Chamness....... 86,069 2,156,132 32,659 78,508
Gayle A. DeBrosse....... -- 1,133,800 0 14,613
Robert T. Trebing, Jr... 49,182 511,733 7,147 19,483
</TABLE>
- --------
(1) The value of unexercised in-the-money options is calculated by
multiplying (A) the number of securities underlying such options by (B)
the difference between (i) the closing price of the Common Stock on the
Nasdaq National Market at December 27, 1998 and (ii) the option exercise
price. The closing value per share was $.5625 on the last trading day of
the 1998 Fiscal Year as reported on the Nasdaq National Market.
Employment Agreements
The Company has employment agreements with Messrs. Relyea, Chamness and Burt
and Ms. DeBrosse. Mr. Relyea's employment agreement, which was amended as of
November 9, 1998, provides that he will serve as the Company's Chief Executive
Officer through December 31, 2001, with an annual base salary of $475,000,
$498,750 and $523,687 in 1999, 2000 and 2001, respectively, or such higher
amount as may from time to time be determined by the Company. Mr. Relyea is
eligible to receive a bonus based upon certain performance measures and
targets.
The employment agreements with Messrs. Chamness and Burt were amended as of
November 9, 1998. The Company entered into an employment agreement with Ms.
DeBrosse on November 1, 1998. Each of the employment agreements provides for a
term ending on December 31, 2001. Pursuant to their respective employment
agreements, Messrs. Burt and Chamness are paid base salaries of $270,000, and
$304,000 respectively for 1999; $283,500, and $319,200, respectively for 2000;
and $297,675 and $335,160, respectively for 2001. Ms. DeBrosse is paid,
pursuant to her employment agreement, $190,000, $199,500 and $209,475 for
1999, 2000 and 2001, respectively, subject to certain increases based upon the
performance of the Company's Koo Koo Roo Restaurant Division. In addition,
such agreements provide for a bonus based upon certain performance measures
and targets.
The employment agreements with each of Messrs. Relyea, Burt and Chamness and
Ms. DeBrosse also provide for standard employee benefits, including, without
limitation, participation in the Company's pension, welfare and stock
incentive plans, to the extent the Company maintains any such plans.
Each of the employment agreements with Messrs. Relyea, Burt and Chamness and
Ms. DeBrosse provides that if the Company terminates the executive's
employment without "cause" or if the executive terminates his or her
employment for "good reason" (each as defined in the employment agreements),
then such executive shall be entitled to receive his or her base salary and
car allowance at the rate in effect at the time of termination for the
remainder of the term or one year from the date of termination, whichever is
greater and continued coverage under the Company's benefit programs through
the remainder of the term or one year from the date of termination, whichever
is greater. If the termination occurs in 1999, the executive will receive his
or her maximum annual incentive award for the remainder of the term. If
termination occurs after December 31, 1999, the executive will receive annual
incentive award amounts equal to the amount of annual incentive earned in the
previous fiscal year for the remainder of the term or one year, whichever is
greater. The Company may elect to pay such severance payments in a lump sum
equal to the present value of future monthly payments.
In the event that any such executive is terminated without "cause" or for
"good reason" or in the event of a "change in control" (as defined in the
employment agreements), each executive's stock options will immediately vest.
The agreements with each of Messrs. Relyea, Burt and Chamness and Ms.
DeBrosse also provide that during the term of employment, and for three years
thereafter, such executive will not (i) disclose or use any "proprietary
information" (as defined in the employment agreements); or (ii) solicit any
employee to terminate employment with the Company.
12
<PAGE>
BOARD OF DIRECTORS' REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors was formed in November
1998 and will be responsible for reviewing and approving the Company's
compensation policies and the compensation paid to executive officers in 1999
and subsequent years. The full Board of Directors was responsible for
reviewing and approving the Company's compensation policies and the
compensation paid to executive officers in 1998. Therefore, the following is
the report of the Board of Directors describing compensation policies and
rationales applicable to the Company's executive officers with respect to
compensation paid to such executive officers for the 1998 Fiscal Year.
Compensation Philosophy:
The Company's compensation program is designed to offer executive officers
competitive compensation based both on the Company's performance and on the
individual's contribution, performance and leadership. The Company's
compensation policies are intended to motivate, reward and retain highly
qualified executives for long-term strategic management and the enhancement of
stockholder value, to support a performance-oriented environment that rewards
achievement of specific internal Company goals, and to attract and retain
executives whose abilities are critical to the long-term success and
competitiveness of the Company.
The three main components in the Company's executive compensation program
are:
. Base Salary
. Incentive Bonus
. Stock Incentives
Base Salary. The salaries of Messrs. Relyea, Chamness and Burt were fixed
pursuant to the terms of their respective employment agreements with the
Company. The salaries of the other executive officers, including Ms. DeBrosse
and Mr. Trebing, are determined annually with consideration given to salaries
paid to executives with similar responsibilities at comparable companies. The
peer group for each executive officer is composed of executives whose
responsibilities are similar in scope and content. In general, the Company
seeks to set executive compensation levels that are competitive with the
average levels of peer group compensation.
Incentive Bonus. Annual incentive bonuses for executive officers, if any,
are intended to reflect the Board of Directors' belief that a portion of the
annual compensation of each executive officer should be contingent upon the
performance of the Company, as well as the individual contribution of each
officer.
Stock Incentives. From time to time, the Company uses stock options and
other incentives as appropriate as long-term incentives to reward and retain
executive officers. The Board of Directors, which had responsibility for
making option grants under the 1998 Stock Incentive Plan in 1998, believes
that stock option grants provide an incentive that focuses the executives'
attention on the Company from the perspective of an owner with an equity stake
in the business. Because options are typically granted with an exercise price
equal to the fair market value of the Common Stock on the date of grant, the
Company's stock will provide value to the recipient only when the price of the
Company's stock increases above the exercise price; that is, only to the
extent that stockholders as a whole have benefitted. Generally, stock options
granted to executive officers vest ratably over a four-year period and
optionees must be employed by the Company at the time of vesting in order to
exercise the options.
13
<PAGE>
Employment Contracts
The Company offers employment contracts to key executives only when the
Company believes it is in the best interest of the Company and its
stockholders to attract and retain such key executives and to ensure
continuity and stability of management.
Compensation of Chief Executive Officer and other Executives
The Board of Directors increased Mr. Relyea's salary in 1998 by 5%. The
increase reflected the Board's assessment of his performance and service to
the Company. Salary increases for other senior executives effected during 1998
ranged from 3% to 10% and were based on similar considerations, including
individual performance, position, tenure, experience, leadership and
competitive data in compensation of executives in comparable companies.
Pursuant to their employment agreements with the Company, senior executives
may receive an annual bonus as determined in accordance with the Company's
bonus plan after review by the Board of Directors. In reviewing the amount of
such bonuses, the Board of Directors considers the individual performance of
each executive and the performance of the Company.
Section 162(m) Policy:
Section 162(m) of the Internal Revenue Code of 1986, as amended, generally
provides that publicly held companies may not deduct compensation paid to
certain of its top executive officers to the extent such compensation exceeds
$1 million per officer in any year. However, pursuant to regulations issued by
the Treasury Department, certain limited exemptions to Section 162(m) apply
with respect to "qualified performance-based compensation" and to compensation
paid in certain circumstances by companies in the first few years following
their initial public offering of stock. Awards granted under the 1998 Stock
Incentive Plan constitute qualified performance-based compensation, and the
Company will continue to monitor the applicability of Section 162(m) to its
ongoing compensation arrangements. Accordingly, the Company does not expect
that amounts of compensation paid to its executive officers will fail to be
deductible on account of Section 162(m).
Respectfully submitted,
Kevin S. Relyea*
A. William Allen, III
Peter Copses
George G. Golleher
David B. Kaplan
Antony P. Ressler
* With respect to that portion of the report entitled "Stock Incentives"
only.
The Board of Directors' Report an Executive Compensation will not be deemed
to be incorporated by reference into any filing by the Company under the
Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as
amended, except to the extent that the Company specifically incorporates the
same by reference.
14
<PAGE>
PERFORMANCE MEASUREMENT COMPARISON
The following graph compares the annual cumulative total stockholder return
on the Common Stock from November 2, 1998, the first day the Common Stock was
traded on the Nasdaq National Market, through December 31, 1998, to the
cumulative total return of the Russell 2000 Index and the index of comparables
companies (SIC 5812--Eating Places). The graph assumes an investment of $100
in the Common Stock on each of the indices on November 2, 1998, and that all
dividends were reinvested. The return shown on the graph is not necessary
indicative of future performance.
11/2/98 12/31/98
------- --------
KOO KOO ROO ENTERPRISES, INC. $100.00 $ 60.00
RUSSELL 2000 INDEX $100.00 $111.46
SIC CODE INDEX $100.00 $112.60
The Stock Price Performance Graph will not be deemed to be incorporated by
reference into any filing by the Company under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended, except to the
extent that the Company specifically incorporates the same by reference.
15
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's Bylaws provide that the Company indemnify its directors and
may indemnify its officers, employees, and other agents to the fullest extent
permitted by law. The Company believes that indemnification under its Bylaws
covers at least negligence and gross negligence by indemnified parties, and
may require the Company to advance litigation expenses in the case of
stockholder derivative actions or other actions against an undertaking by the
indemnified party to repay such advances if it is ultimately determined that
the indemnified party is not entitled to indemnification.
In addition, the Company's Certificate of Incorporation provides that,
pursuant to Delaware law, its directors shall not be liable for monetary
damages for breach of the directors' fiduciary duty of care to the Company and
its stockholders. This provision in the Certificate of Incorporation does not
eliminate the duty of care, and in appropriate circumstances equitable
remedies such as injunctive or other forms of non-monetary relief will remain
available under Delaware law. In addition, each director will continue to be
subject to liability for breach of the director's duty of loyalty to the
Company for acts or omissions not in good faith or involving intentional
misconduct, for knowing violations of law, for actions leading to improper
personal benefit to the director, and for payment of dividends or approval of
stock repurchases or redemptions that are unlawful under Delaware law. The
provision also does not affect a director's responsibilities under any other
law, such as the federal securities laws or state or federal environmental
laws.
The Company is aware that its majority stockholder AIF II, L.P. ("AIF") has
entered into a separate indemnification agreement with Mr. Golleher, a non-
employee director.
On December 1, 1998, the Company entered into a Nominating Agreement with
AIF. In exchange for AIF's agreement to terminate a Management Services
Agreement between the Company and an AIF affiliate, and to waive certain fees
thereunder, the Company agreed that, until AIF and its affiliates own less
than 23,958,000 shares of the Company's Common Stock: (a) the number of
directors of the Company will not exceed seven, (b) the Company will support
the nomination of, and use its best efforts to cause the Board of Directors to
include in the slate of nominees recommended to the stockholders for election
as directors, (i) four of AIF's nominees if AIF and its affiliates own
47,916,000 or more shares of the Company's Common Stock and (ii) two of AIF's
nominees if AIF and its affiliates own less than 47,916,000 but at least
23,958,000 shares of the Company's Common Stock and (c) at least one AIF
nominee shall serve on each committee of the Board of Directors (other than
those committees formed solely for the purpose of considering matters related
to AIF or its affiliates) and so long as AIF and its affiliates own at least
47,916,000 shares of the Company's Common Stock, AIF nominees shall constitute
a majority of the members of each of such committees.
The Company maintains insurance policies covering officers and directors
under which the insurers agree to pay, subject to certain exclusions,
including certain violations of securities laws, for any claim made against
the directors and officers of the Company for a wrongful act that they may
become legally obligated to pay or for which the Company is required to
indemnify the officers or directors. The Company believes that its Certificate
of Incorporation and provisions of the Bylaws, and such insurance policies are
necessary to attract and retain qualified persons as directors and officers.
At present, there is no pending litigation or proceeding involving a
director, officer, employee or other agent of the Company as to which
indemnification is being sought, nor is the Company aware of any threatened
litigation that may result in claims for indemnification by any director,
officer, employee or other agent.
16
<PAGE>
STOCKHOLDER PROPOSALS
The deadline for submitting a stockholder proposal for inclusion in the
Company's proxy statement and form of proxy for the Company's annual meeting
of stockholders to be held in the year 2000, pursuant to Rule 14a-8,
"Shareholder Proposals" of the Commission is 120 days before the anniversary
date of this proxy. Stockholder proposals submitted to the Company outside the
processes of Rule 14a-8 (i.e., the procedures for placing a stockholder's
proposal in the Company's proxy materials) (i) will be considered untimely
with respect to the annual meeting of stockholders to be held in the year 2000
if received by the Company before February 12, 2000 or after March 13, 2000.
Stockholders are also advised to review the Company's Second Amended and
Restated Bylaws, which contain additional advance notice requirements,
including requirements with respect to advance notice of stockholder proposals
and director nominations.
OTHER MATTERS
A copy of the Company's Annual Report of Form 10-K for the 1998 Fiscal Year,
as filed with the Commission, excluding exhibits, may be obtained by
stockholders without charge by written request addressed to Prandium, Inc.,
attention Investor Relations, 18831 Von Karman Avenue, Suite 300, Irvine,
California 92612, or may be accessed on the Internet at www.prandium.com.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ KEVIN S. RELYEA
----------------------------------
Kevin S. Relyea
Chairman of the Board, Chief
Executive Officer and President
Irvine, California
April 19, 1999
17
<PAGE>
- --------------------------------------------------------------------------------
Please mark [X]
your votes
as indicated
WITHHOLD FOR ALL
FOR ALL AS TO ALL NOMINEE(S) (Except
NOMINEES NOMINEES as written below)
1. Election of Directors: [_] [_] [_]
Nominees: Kevin S. Relyea, A. William Allen, III, Peter P. Copses,
George G. Gollaher, David B. Kaplan and Anthony P. Ressier.
________________________________________________________________________________
________________________________________________________________________________
FOR AGAINST ABSTAIN
2. Ratification of the selection of KPMG LLP to serve [_] [_] [_]
as Company's Independent accountants for the fiscal
year ending December 26, 1999.
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment(s) or postponement(s) thereof and as to which
the undersigned hereby confers discretionary confers discretionary
authority.
CHECK HERE IF YOU PLAN TO ATTEND THE MEETING [_]
THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL BE CAST IN ACCORDANCE WITH
THE SPECIFICATIONS MADE. IF THIS PROXY IS EXECUTED BUT NO SPECIFICATION IS
MADE, THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL BE CAST "FOR" THE
FOREGOING PROPOSALS AND OTHERWISE IN THE DISCRETION OF THE PROXIES AT THE ANNUAL
MEETING OR ANY ADJOURNMENT(S) OR POSTPONEMENT(S) THEREOF.
Sign Date and Return the Proxy Card
Promptly Using the Enclosed Envelope.
Signature_______________________________________________________________________
Signature If held jointly_____________________________Dated ______________, 1999
IMPORTANT: Please sign exactly as your name appears hereon and date. If the
shares are held jointly, each holder should sign. When signing as an attorney,
executor, administrator, trustee, guardian or as an officer, signing for a
corporation or other entity, please give full title under signature.
- --------------------------------------------------------------------------------
-- FOLD AND DETACH HERE --
- --------------------------------------------------------------------------------
PROXY PRANDIUM, INC.
(Formerly Koo Koo Roo Enterprises, Inc.
Proxy For Annual Meeting Of Stockholders
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned stockholder of Prandium, Inc., a Delaware corporation, (the
"Company"), hereby appoints Kevin S. Relyea and Robert T. Trebing, Jr., and each
of them, as proxies for the undersigned, with full power of substitution in each
of them, to attend the Annual Meeting of Stockholders of the Company to be held
on Friday, June 11, 1999 at 10:00 a.m. local time, at the Hyatt Regency Irvine
Hotel, 17900 Jamboree Road, Irvine, California, 92617, and at any adjournment(s)
or postponement(s) thereof, to cast on behalf of the undersigned all votes that
the undersigned is entitled to cast at such meeting and otherwise to represent
the undersigned at the meeting, with the same effect as if the undersigned were
present. The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting of Stockholders and the accompanying Proxy Statement and revokes any
proxy previously given with respect to such shares.
(Continued on other side)
- --------------------------------------------------------------------------------
-- FOLD AND DETACH HERE --
