<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
---------------------
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended: March 29, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the transition period from__________________to______________
-----------------------
COMMISSION FILE NUMBER: 1-13044
COOKER RESTAURANT CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
OHIO 62-1292102
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
5500 VILLAGE BOULEVARD, WEST PALM BEACH, FLORIDA 33407
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (561) 615-6000
Indicate by check X whether the registrant: (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
[X] [ ]
Yes No
10,139,000 COMMON SHARES, WITHOUT PAR VALUE
(Number of Common Shares outstanding as of the close of
business on May 4, 1998)
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
March 29, December 28,
1998 1997
------------------- -----------------
ASSETS (In Thousands)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 1,770 $ 4,685
Inventory 1,460 1,509
Land held for sale 55 55
Prepaid and other current assets 1,300 1,057
------------------- -----------------
Total current assets 4,585 7,306
Property and equipment, net 137,029 134,190
Other assets 1,515 1,425
------------------- -----------------
$ 143,129 $ 142,921
=================== =================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities long-term debt $ 1,650 $ --
Accounts payable 3,326 4,668
Accrued and other liabilities 5,669 6,857
Income taxes payable 1,156 61
------------------- -----------------
Total current liabilities 11,801 11,586
Long-term debt, excluding current maturities 40,765 42,415
Deferred income taxes 1,813 1,813
Other liabilities 628 635
------------------- -----------------
Total Liabilities 55,007 56,449
------------------- -----------------
Shareholders' equity:
Common shares-without par value: authorized 30,000,000
shares; issued 10,548,000 shares at March 29,
1998 and December 28, 1997 63,032 63,039
Retained earnings 31,206 29,570
Treasury stock, at cost, 524,000 and 526,000 shares at
March 29, 1998 and December 28,1997, respectively (6,116) (6,137)
------------------- -----------------
88,122 86,472
Commitments and contingencies
------------------- -----------------
$ 143,129 $ 142,921
=================== =================
</TABLE>
See accompanying notes to condensed consolidated financial statements.
2
<PAGE> 3
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 29, March 30,
1998 1997
--------------------- ---------------------
(In Thousands Except Per Share Data)
<S> <C> <C>
Sales
$ 40,434 $ 32,507
----------------- ----------------
Cost of Sales:
Food and beverage 11,421 9,259
Labor 13,853 11,169
Restaurant operating expenses 6,983 5,456
Restaurant depreciation and amortization 1,464 1,064
General and administrative 2,556 2,393
Interest expense, net 588 259
----------------- ----------------
36,865 29,600
----------------- ----------------
Income before income taxes and cumulative effect of a
change in accounting principle 3,569 2,907
Provision for income taxes before cumulative effect of a
change in accounting principle 1,231 996
----------------- ----------------
Income before cumulative effect of a change in accounting
principle 2,338 1,911
Cumulative effect of a change in accounting for
preoperational costs (less tax of $253) -- 496
----------------- ----------------
Net income $ 2,338 $ 1,415
================= ================
Basic earnings per common share:
Income before cumulative effect of change in accounting
principle $ 0.23 $ 0.19
Cumulative effect of change in accounting for
preoperational costs -- (0.05)
----------------- ----------------
Net income $ 0.23 $ 0.14
================= ================
Diluted earnings per common share:
Income before cumulative effect of change in accounting
principle $ 0.23 $ 0.19
Cumulative effect of change in accounting for
preoperational costs -- (0.05)
----------------- ----------------
Net income $ 0.23 $ 0.14
================= ================
Weighted average number of common shares outstanding - basic 10,023 10,035
Weighted average number of common shares outstanding - diluted 10,177 10,274
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE> 4
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 29, March 30,
1998 1997
---------------- -----------------
(In Thousands)
<S> <C> <C>
Cash flows from operating activities:
Net income $ 2,338 $ 1,415
Adjustments to reconcile net income to net cash provided by operating
activities:
Cumulative effect of change in accounting principle -- 496
Depreciation and amortization 1,578 1,136
Deferred income taxes -- 253
Loss on sale of property -- 51
(Increase) in current assets (194) (509)
(Increase) decrease in other assets (90) 36
(Decrease) in current liabilities (1,398) (1,181)
------------ ------------
Net cash provided by operating activities 2,234 1,697
------------ ------------
Cash flows from investing activities:
Purchases of property and equipment (4,418) (6,776)
Proceeds from sale of property and equipment -- 309
------------ ------------
Net cash used in investing activities (4,418) (6,467)
------------ ------------
Cash flows from financing activities:
Payment on note payable -- (1,538)
Proceeds from borrowings -- 8,291
Redemption of debentures -- (23)
Exercise of stock options 14 --
Purchases of treasury stock -- (383)
Capital lease obligations (43) --
Dividends paid (702) (703)
------------ ------------
Net cash (used in) provided by financing activities (731) 5,644
------------ ------------
Net (decrease) increase in cash and cash equivalents (2,915) 874
Cash and cash equivalents, at beginning of period 4,685 2,009
------------ ------------
Cash and cash equivalents, at end of period $ 1,770 $ 2,883
============ ============
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE> 5
COOKER RESTAURANT CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 30, 1997 and March 29, 1998
(unaudited)
Note 1: Basis of Presentation.
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the accompanying condensed consolidated financial statements contain
all adjustments, consisting of normal recurring accruals, necessary to present
fairly the financial position of the Cooker Restaurant Corporation and
subsidiaries (the "Company"), after elimination of intercompany accounts and
transactions, at March 29, 1998 and the statements of income and cash flows for
the three months ended March 29, 1998. The results of operations for the three
months ended March 29, 1998 are not necessarily indicative of the operating
results expected for the fiscal year ended January 3, 1999. These financial
statements should be read in conjunction with the financial statements and notes
thereto contained in the Company's annual report on Form 10-K for the fiscal
year ended December 28, 1997.
Certain amounts in the 1997 financial statements have been reclassified to
conform to the 1998 presentation.
Note 2: Earnings Per Share.
In December 1997, the Company adopted the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 128, "Earnings Per Share," which establishes
new guidelines for the calculation of earnings per share. Basic earnings per
share have been computed by dividing net income by the weighted average number
of shares outstanding during the year. Diluted earnings per share have been
computed assuming the exercise of stock options, as well as their related income
tax effects. Earnings per share for all prior periods have been restated to
reflect the provisions of this statement.
Convertible subordinated debentures outstanding as of March 29, 1998 are
convertible into 691,710 shares of common stock at $21.5625 per share and are
due October 2002, were not included in the computation of diluted EPS for each
quarters ended March 30, 1997 and March 29, 1998 as the inclusion of the
convertible subordinated debentures would be antidilutive.
Options to purchase 839,965 and 511,590 shares at prices ranging from $10.375 to
$21.75 per share and $11.25 to $21.75 per share, were outstanding for the
quarter ended March 29, 1998 and March 30, 1997, respectively, but were not
included in the computation of diluted EPS because the options' exercise prices
were greater than the average market price of the common shares for the quarters
ended March 29, 1998 and March 30, 1997 respectively. The options expire between
October 2001 and April 2007 for the quarter ended March 28, 1998 and between
April 2002 and March 2007 for the quarter ended March 30, 1997.
Note 3: Recent Accounting Pronouncements.
Effective December 29, 1997, the Company adopted the Financial Accounting
Standard Board ("FASB") No. 130 - "Reporting Comprehensive Income" and No. 131 -
"Disclosure about Segments of an Enterprise and Related Information." The
adoption of these pronouncements did not have a significant impact on the
Company's consolidated financial position, results of operations or cash flows.
5
<PAGE> 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
From time to time, the Company may make certain statements that contain
"forward-looking" information (as defined in the Private Securities Litigation
Reform Act of 1995). Words such as "believe," "anticipate," "estimate,"
"project," and similar expressions are intended to identify such forward-looking
statements. Forward-looking statements may be made by management orally or in
writing, including, but not limited to, in press releases, as part of this
Management's Discussion and Analysis of Financial Condition and Results of
Operations and as part of other sections of this Report or other filings.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their respective dates, and are subject to
certain risks, uncertainties and assumptions. These statements are based on
management's present assumptions as to future trends, including economic trends,
prevailing interest rates, the availability and cost of raw materials, the
availability of the capital resources necessary to complete the Company's
expansion plans, government regulations, especially regulations regarding taxes,
labor and alcoholic beverages, competition, consumer preferences and similar
factors. Changes in these factors could affect the validity of such assumptions
and could have a materially adverse effect on the Company's business.
RESULTS OF OPERATIONS
The following table sets forth as a percentage of sales certain items
appearing in the Company's statements of income.
RESULTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 29, March 30,
1998 1997
----------------- ---------------
<S> <C> <C>
Sales 100.0% 100.0%
----------------- ---------------
Cost of sales:
Food and beverage 28.2 28.5
Labor 34.3 34.3
Restaurant operating expenses 17.3 16.8
Restaurant depreciation and amortization 3.6 3.3
General and administrative 6.3 7.4
Interest expense (net) 1.5 0.8
----------------- ---------------
91.2 91.1
Income before income taxes and cumulative effect of a change
in accounting principle 8.8 8.9
Provision for income taxes before cumulative effect of a change
in accounting principle 3.0 3.0
----------------- ---------------
Income before cumulative effect of a change in accounting
principle 5.8 5.9
Cumulative effect of change in accounting for preoperational
costs -- 1.5
----------------- ---------------
Net income 5.8% 4.4%
================= ===============
</TABLE>
Sales for the first quarter of fiscal 1998 increased 24% to $40,434,000 from
$32,507,000 in the first quarter last year. Most of the sales increase is from
the fourteen stores that have opened during the prior twelve months. Same-store
sales (which excludes 18 of the 62 units open at the end of the quarter) were
.2% above last year's first quarter. The average
6
<PAGE> 7
weekly sales for all 62 stores opened as of the end of the first quarter this
year were up .6% from the average of all stores opened as of the end of the
first quarter last year.
First quarter cost of food and beverages as a percent of sales was down 30
basis points from the same period last year. The improvement is the result of a
change in menu mix and the cumulative effect of price increases (approximately
2%) over the past year. Actual ingredient costs were fairly stable throughout
the quarter.
Labor cost, as a percentage of sales and actual dollar cost per store, in
the first quarter were unchanged from last year.
Restaurant operating expense for the first quarter increased 50 basis points
to 17.3%. Areas showing spending increases over last year were repairs and
maintenance, local store marketing activities and miscellaneous operating
supplies.
General and administrative expense declined from 7.4% of sales in last
year's first quarter to 6.3% of sales this year. This change is the result of a
reduction in pre-opening expense from $658,000 last year (restated for change in
accounting) to $293,000 this year. This year's first quarter includes the cost
of opening restaurants in Augusta, GA and Troy, MI as well as $41,000 of
expenses related to second quarter openings.
Net interest expense for the first quarter of 1998 was $588,000 which was
$329,000 more than for the first quarter of 1997. The increase in net interest
expense is the result of increased borrowings on the Company's line of credit.
The provision for income taxes as a percentage of income before taxes of
34.5% was up 20 basis points from last year's first quarter.
LIQUIDITY AND CAPITAL RESOURCES
The Company's principal capital requirements are for working capital, new
restaurant openings and improvements to existing restaurants. The majority of
the Company's financing for operations, expansion and working capital is
provided by internally generated cash flows from operations and borrowings under
a revolving term loan agreement, which provides a $33,000,000 line of credit
through January 4, 1999, with maximum quarterly principal payments of $1,650,000
due January 4, 1999 and April 1, 1999 and the remaining outstanding balance due
June 30, 1999.
During the first quarter of 1998, the Company opened two new units. Capital
expenditures for these new units and the refurbishing and remodeling of existing
units totaled $4,418,000 and were funded by cash flows of $2,234,000 from
operations and borrowings under the revolving line of credit. The Company has
opened 4 restaurants to date in 1998. The Company intends to open an additional
4 restaurants in 1998 for a total of 8 new restaurants. The Company had
previously planned to open a total of 12 restaurants in 1998, but in January,
1998, after reviewing the results of 1997 including lower earnings per share in
1997 as compared to 1996 and a consequent decline in Common Share prices, the
Board of Directors determined to delay the opening of 4 restaurants in order to
allow senior management to focus their efforts on rebuilding average unit
volumes and Shareholder value. Total cash expenditures for the 1998 expansion
are estimated to be approximately $14.5 million. The Company believes that cash
flow from operations together with borrowings under the revolving term loan
agreement will be sufficient to fund the planned expansion, ongoing maintenance
and remodeling of existing restaurants as well as other working capital
requirements. As of March 29, 1998, the Company had borrowed $27,500,000 of the
$33,000,000 available under its revolving term loan agreement.
The Company's operations are subject to factors outside its control. Any
one, or combination, of these factors could materially affect the results of the
Company's operations. These factors include: (a) changes in the general economic
conditions in the United States, (b) changes in prevailing interest rates, (c)
changes in the availability and cost of raw materials, (d) changes in the
availability of the capital resources necessary to complete the Company's
expansion plans; (e) changes in Federal and State regulations or interpretations
of existing legislation, especially concerning taxes, labor and alcoholic
beverages, (f) changes in the levels of competition from current competitors and
potential new
7
<PAGE> 8
competition, and (g) changes in the levels of consumer spending and customer
preferences. The foregoing should not be construed as an exhaustive list of all
factors which could cause actual results to differ materially from those
expressed in forward-looking statements made by the Company. Forward-looking
statements made by or on behalf of the Company are based on a knowledge of its
business and the environment in which it operates, but because of the factors
listed above, actual results may differ from those anticipated results described
in those forward-looking statements. Consequently, all of the forward-looking
statements made are qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by the Company
will be realized or, even if substantially realized, that they will have the
expected consequences to or effects on the Company or its business or
operations.
The Company has only limited involvement with derivative financial
instruments and does not use them for trading purposes. They are used to manage
well-defined interest rate risk. Interest rate swap agreements are used to
reduce the potential impact of increases in interest rates on floating-rate
long-term debt. At March 29, 1998, the Company was party to an interest rate
swap agreement with a termination date of September 28, 2001. The agreement
entitles the Company to receive from the counterparty (a major bank), the
amounts, if any, by which the Company's interest payments on its $27,500,000
line of credit (included in the $33,000,000 line of credit) exceed 6.25 percent
through the termination date. No amounts were received by the Company during the
quarter ended March 29, 1998.
The fair value of the interest swap agreement approximated ($356,000) at
March 27, 1998. The fair value is estimated using option pricing models that
value the potential for the swaps to become in-the-money (liability) through
changes in interest rates during the remaining term of the agreement.
The Company is exposed to credit losses in the event of nonperformance by
the counterparties to its interest rate swap agreements. The Company
anticipates, however, that counterparties will be able to fully satisfy their
obligations under the contracts. The Company does not obtain collateral to
support financial instruments but monitors the credit standing of the
counterparties.
In 1994, the Board of Directors approved a guaranty by the Company of a loan
of $5,000,000 to G. Arthur Seelbinder, the Chairman of the Board. In January,
1997, the Board approved a refinancing of the loan with The Chase Manhattan Bank
of New York (the "Bank"). The loan (the "Loan") from the Bank bears interest at
the Bank's prime rate or LIBOR plus 2%, is secured by 570,000 Common Shares and
is guaranteed by the Company in the principal amount up to $6,250,000 including
capitalized interest. Pursuant to the loan agreement between Mr. Seelbinder and
the Bank, any reduction of the principal amount outstanding under the Loan shall
not entitle Mr. Seelbinder to the advancement of additional funds under the
Loan. The guaranty provides that the Bank will sell the pledged shares and apply
the proceeds thereof to the Loan prior to calling on the Company for its
guaranty. The term of the Loan was scheduled to expire in the first quarter of
1998. The term of the Loan has been extended until January 31, 1999. At May 7,
1998, the amount of the Loan outstanding, including capitalized and accrued
interest, was approximately $5,382,000 and the undiscounted fair market value of
the pledged shares was approximately $6,697,000. The guaranty secures the Loan
until it is repaid or refinanced without a guaranty. The Company would fund any
obligation it incurs under the terms of its guaranty from additional borrowings
under its revolving term loan agreement. There can be no assurance that the Loan
will be repaid or refinanced at January 31, 1999 on terms that will not result
in continuing the guaranty or in a material payment. Mr. Seelbinder agreed to
pay to the Company a guaranty fee each year that the guaranty remains
outstanding beginning on March 9, 1994, the date the Company first issued its
guaranty of the loan. The amount of the guaranty fee is 1/4 percent of the
outstanding principal amount of the guaranteed loan on the date that the
guaranty fee becomes due. Mr. Seelbinder has agreed to use at least one-half of
any incentive bonus paid to him by the Company to pay principal and interest on
the Loan beginning with any incentive bonus paid for fiscal year 1998. Mr.
Seelbinder has also agreed to make payments on the Loan in amounts sufficient to
ensure that the Loan balance on January 31, 1999 does not exceed 90 percent of
the Loan balance on January 31, 1998.
Effective December 29, 1997, the Company adopted the Financial Accounting
Standard Board ("FASB") No. 130 - "Reporting Comprehensive Income" and No. 131 -
"Disclosure about Segments of an Enterprise and Related Information." The
adoption of these pronouncements did not have a significant impact on the
Company's consolidated financial position, results of operations or cash flows.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
8
<PAGE> 9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) THE FOLLOWING EXHIBITS ARE FILED AS PART OF THIS REPORT.
3. ARTICLES OF INCORPORATION AND BY-LAWS.
Exhibit 3.1
Amended and Restated Articles of Incorporation of the Registrant (incorporated
by reference to Exhibit 28.2 of Registrant's quarterly report on Form 10-Q for
the fiscal quarter ended March 29, 1992; Commission File No. 0-16806).
Exhibit 3.2
Amended and Restated Code of Regulations of the Registrant (incorporated by
reference to Exhibit 4.5 of the Registrant's quarterly report on Form 10-Q for
the fiscal quarter ended April 1, 1990; Commission File No. 0-16806).
9
<PAGE> 10
4. INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES.
Exhibit 4.1
See Articles FOURTH, FIFTH and SIXTH of the Amended and Restated Articles of
Incorporation of the Registrant (see Exhibit 3.1 above).
Exhibit 4.2
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see Exhibit 3.2 above).
Exhibit 4.3
Rights Agreement dated as of February 1, 1990 between the Registrant and
National City Bank (incorporated by reference to Exhibit 1 of the Registrant's
Form 8-A filed with the Commission on February 9, 1990; Commission File No.
0-16806).
Exhibit 4.4
Amendment to Rights Agreement dated as of November 1, 1992 between the
Registrant and National City Bank (incorporated by reference to Exhibit 4.4 of
Registrant's annual report on Form 10-K for the fiscal year ended January 3,
1993 (the "1992 Form 10-K"); Commission File No. 0-16806).
Exhibit 4.5
Letter dated October 29, 1992 from the Registrant to First Union National Bank
of North Carolina (incorporated by reference to Exhibit 4.5 to the 1992 Form
10-K).
Exhibit 4.6
Letter dated October 29, 1992 from National City Bank to the Registrant
(incorporated by reference to Exhibit 4.6 to the 1992 Form 10-K).
Exhibit 4.7
See Section 7.4 of the Amended and Restated Loan Agreement dated December 22,
1995 between the Registrant and First Union National Bank of Tennessee
(incorporated by reference to Exhibit 10.4 of the Registrant's annual report on
Form 10-K for the fiscal year ended December 31, 1995; Commission File No.
0-16806).
10
<PAGE> 11
Exhibit 4.8
Indenture dated as of October 28, 1992 between the Registrant and First Union
National Bank of North Carolina, as Trustee (incorporated by reference to
Exhibit 2.5 of Registrant's Form 8-A filed with the Commission on November 10,
1992; Commission File No. 0-16806).
10. MATERIAL CONTRACTS.
Exhibit 10.15
Second Amendment to Amended and Restated Loan Agreement dated as of January 1,
1998 between the Registrant and First Union National Bank, a national banking
association, as successor in interest to First Union National Bank of Tennessee.
Page 16 in the manually signed original.
Exhibit 10.16
Fourth Amendment to Revolving/Term Loan Note dated as of January 1, 1998 between
the Registrant and First Union National Bank, a national banking association, as
successor in interest to First Union National Bank of Tennessee.
Page 23 in the manually signed original.
Exhibit 10.17
Reaffirmation of Amended and Restated Guaranty made by the Registrant on April
20, 1998 to the Chase Manhattan Bank.
Page 24 in the manually signed original.
Exhibit 10.18
Letter agreement dated March 26, 1998 between The Chase Manhattan Bank and G.
Arthur Seelbinder.
Page 27 in the manually signed original.
Exhibit 10.19
Amendment to Grid Time Promissory Note dated March 26, 1998 between The Chase
Manhattan Bank and G. Arthur Seelbinder.
Page 29 in the manually signed original.
27. FINANCIAL DATA SCHEDULES
Exhibit 27.1
Financial Data Schedules (submitted electronically for SEC information only).
(b) REPORTS ON FORM 8-K.
No report on Form 8-K was filed by Registrant during the fiscal quarter ended
March 29, 1998.
11
<PAGE> 12
SIGNATURES
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 thereunto duly authorized.
COOKER RESTAURANT CORPORATION
(The "Registrant")
Date: May 11, 1998
By: /s/ G. ARTHUR SEELBINDER
---------------------------------------------------
G. Arthur Seelbinder
Chairman of the Board, Chief Executive Officer, and
Director
(principal executive officer)
By: /s/ DAVID C. SEVIG
---------------------------------------------------
David C. Sevig
Vice President - Chief Financial Officer
(principal financial and accounting officer)
12
<PAGE> 13
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
COOKER RESTAURANT CORPORATION
----------------------
FORM 10-Q QUARTERLY REPORT
FOR THE FISCAL QUARTER ENDED:
MARCH 29, 1998
----------------------
EXHIBITS
----------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
13
<PAGE> 14
Exhibit 3.1
Amended and Restated Articles of Incorporation of the Registrant (incorporated
by reference to Exhibit 28.2 of Registrant's quarterly report on Form 10-Q for
the fiscal quarter ended March 29, 1992; Commission File No. 0-16806).
Exhibit 3.2
Amended and Restated Code of Regulations of the Registrant (incorporated by
reference to Exhibit 4.5 of the Registrant's quarterly report on Form 10-Q for
the fiscal quarter ended April 1, 1990; Commission File No. 0-16806).
Exhibit 4.1
See Articles FOURTH, FIFTH and SIXTH of the Amended and Restated Articles of
Incorporation of the Registrant (see Exhibit 3.1 above).
Exhibit 4.2
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see Exhibit 3.2 above).
Exhibit 4.3
Rights Agreement dated as of February 1, 1990 between the Registrant and
National City Bank (incorporated by reference to Exhibit 1 of the Registrant's
Form 8-A filed with the Commission on February 9, 1990; Commission File No.
0-16806).
Exhibit 4.4
Amendment to Rights Agreement dated as of November 1, 1992 between the
Registrant and National City Bank (incorporated by reference to Exhibit 4.4 of
Registrant's annual report on Form 10-K for the fiscal year ended January 3,
1993 (the "1992 Form 10-K"); Commission File No. 0-16806).
Exhibit 4.5
Letter dated October 29, 1992 from the Registrant to First Union National Bank
of North Carolina (incorporated by reference to Exhibit 4.5 to the 1992 Form
10-K).
Exhibit 4.6
Letter dated October 29, 1992 from National City Bank to the Registrant
(incorporated by reference to Exhibit 4.6 to the 1992 Form 10-K).
14
<PAGE> 15
Exhibit 4.7
See Section 7.4 of the Amended and Restated Loan Agreement dated December 22,
1995 between the Registrant and First Union National Bank of Tennessee
(incorporated by reference to Exhibit 10.4 of the Registrant's annual report on
Form 10-K for the fiscal year ended December 31, 1995, Commission File No.
0-16806).
Exhibit 4.8
Indenture dated as of October 28, 1992 between the Registrant and First Union
National Bank of North Carolina, as Trustee (incorporated by reference to
Exhibit 2.5 of Registrant's Form 8-A filed with the Commission on November 10,
1992; Commission File No. 0-16806).
Exhibit 10.15
Second Amendment to Amended and Restated Loan Agreement dated as of January 1,
1998 between the Registrant and First Union National Bank, a national banking
association, as successor in interest to First Union National Bank of Tennessee.
Exhibit 10.16
Fourth Amendment to Revolving/Term Loan Note dated as of January 1, 1998 between
the Registrant and First Union National Bank, a national banking association, as
successor in interest to First Union National Bank of Tennessee.
Exhibit 10.17
Reaffirmation of Amended and Restated Guaranty made by the Registrant on April
20, 1998 to the Chase Manhattan Bank.
Exhibit 10.18
Letter agreement dated March 26, 1998 between The Chase Manhattan Bank and G.
Arthur Seelbinder.
Exhibit 10.19
Amendment to Grid Time Promissory Note dated March 26, 1998 between The Chase
Manhattan Bank and G. Arthur Seelbinder.
Exhibit 27.1
Financial Data Schedule (submitted electronically for SEC information only).
15
<PAGE> 1
EXHIBIT 10.15
SECOND AMENDMENT TO
AMENDED AND RESTATED LOAN AGREEMENT
This Second Amendment to Amended and Restated Loan Agreement is entered
into as of the 1st day of January, 1998, by and between COOKER RESTAURANT
CORPORATION ("Borrower"), a corporation organized and existing under the laws of
the State of Ohio, and FIRST UNION NATIONAL BANK ("Lender"), a national banking
association, as successor in interest to First Union National Bank of Tennessee.
RECITALS
WHEREAS, the parties hereto entered into that certain amended and restated
loan agreement dated December 22, 1995, as amended as of May, 1996 (the "Loan
Agreement");
WHEREAS, the Loan Agreement provides for a revolving credit facility that
was to be converted into a term facility on January 1, 1998, so that no further
advances thereunder would be made after January 1, 1998;
WHEREAS, the Borrower contemplates a restructuring of its corporate
structure to better reflect its geographical diversity, but requires the consent
of the Lender as a condition thereto;
WHEREAS, the parties are reviewing options to restructure the existing
financing, and desire to amend certain terms of the Loan Agreement while that
review is being conducted to permit the Borrower to continue to be able to
receive advances under the Loan Agreement and to reflect certain conditions to
approval of the Reorganization (as defined herein);
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. The provisions of Sections 3, 4, 5, and 6 of this Agreement will only be
effective at the Effective Time (as defined in Section 19 hereof).
2. Article I of the Loan Agreement is amended as follows:
(i) There is added between the definitions of "ERISA" and "Financial
Statements" the following definition:
"FCLP Pledge Agreement" shall mean that certain pledge agreement
of even date herewith by Florida Cooker LP, Inc. in favor of the Lender, which
shall be in form acceptable to the Lender."
(ii) There is hereby added between the definitions of "GAAP" and
"Hazardous Waste" the following definitions:
"Guarantee" shall mean collectively those certain guaranties of
even date herewith from the Guarantors in favor of the Lender, each of which
shall be in form acceptable to the Lender.
"Guarantor" shall mean each of, and "Guarantors" shall mean
collectively all of, CGR Management Corporation, a corporation organized under
the laws of Florida; Florida Cooker LP, Inc., a corporation organized under the
laws of Florida; and, Southern Cooker Limited Partnership, a limited partnership
organized under the laws of Ohio.
(iii) There is added between the definitions of "Hazardous Substances"
and "IRC" the following definition:
"Indemnification Agreement" shall mean that certain indemnification
agreement dated as of January 1, 1998 from the Borrower and the Guarantors in
favor of the Lender, which shall be in form acceptable to the Lender."
<PAGE> 2
(iv) There is hereby added a new sentence at the end of the existing
definition of "Loan Documents" which sentence provides in entirety as follows:
"The term Loan Documents includes, but is not limited to, this Agreement, the
Revolving/Term Loan Note, the Guaranty, the Pledge Agreement and the FCLP Pledge
Agreement."
(v) There is added between the definitions of "Plan" and "Property" the
following definition:
"Pledge Agreement" shall mean that certain stock pledge agreement
dated of even date herewith from the Borrower in favor of the Lender, which
shall be in form acceptable to the Lender.
(vi) There is added between the definitions of "Real Property" and
"Revolving/Term Loan" the following definition:
"Reorganization" means that certain organization of Subsidiaries
and transfer of assets described in Exhibit IA.
(vii) There is added between the definitions of "Revolving/Term Loan"
and "Solvent" the following definition:
"Revolving/Term Loan Note" shall mean that certain Revolving/Term
Loan note dated August 26, 1991, as amended on June 29, 1993, on January 11,
1995, on December 22, 1995, and as of January 1, 1998."
3. The fourth sentence of Section 2.2(c.) of the Loan Agreement is amended
to provide in its entirety as follows:
"Provided, finally, at no time shall more than seven (7) separate interest rates
apply to borrowings under the Revolving/Term Loan."
4. The second and third sentences of Section 2.3(b) are amended to provide
in their entirety as follows:
"Additionally, on each of January 4, 1999, and April 5, 1999, Borrower shall
make a principal repayment of $1,650,000. Provided, however, if the
Revolving/Term Loan is not fully funded on January 1, 1999, the amount of the
quarterly principal installments due on January 2, 1999, and April 5, 1999 shall
be equal to the actual principal amount outstanding on January 1, 1999 divided
by twenty (20)."
5. Section 2.3(d) of the Loan Agreement is hereby amended to provide in its
entirety as follows:
"(d) All Amounts Due. All remaining principal, interest and expenses
outstanding under the Revolving/Term Loan shall become due June 30, 1999."
6. The second sentence of Section 2.4(a) of the Loan Agreement is amended
to provide in its entirety as follows:
"Without limiting the foregoing, the sum of $3,000,000 from the
Revolving/Term Loan is hereby designated by Borrower and Lender as "Daily
Working Capital Facility A."
7. The first sentence of the first paragraph of Section 2.5 of the Loan
Agreement is hereby amended to provide in its entirety as follows:
"From the Closing Date until January 1, 1999 (the "Conversion Date"),
Borrower may from time to time request and repay Advances under the
Revolving/Term Loan, provided that the total principal amount outstanding under
the Revolving/Term Loan shall not at any time exceed the amount stated in
Section 2.1 above or the amount permitted under Section 2.3(b) above."
8. Section 4.21 of the Loan Agreement is hereby amended to provide in its
entirety as follows:
2
<PAGE> 3
"Section 4.21 Subsidiaries. The Subsidiaries of the Borrower are as set
forth on Schedule 4.21 hereof, which schedule sets forth the amount of
authorized and outstanding capital stock of the Subsidiaries and the ownership
of the Subsidiaries.
9. There is hereby added to the Loan Agreement a new Section 5.16, which
provides in its entirety as follows:
"Section 5.16 The Reorganization. Prior to the Reorganization, the Borrower
did not Control any Person. As a result of the Reorganization, the Borrower has
caused to be organized the Guarantors, and has contributed certain assets to the
Guarantors which were previously the assets of the Borrower. Borrower
acknowledges that the Reorganization is not intended to adversely effect the
Lender or the Lender's rights to be repaid the Revolving/Term Loan, including
the Lender's continuing rights to realize upon the assets that have been
contributed to the Guarantors, or any assets that the Guarantors acquire as a
result of such contribution of assets or subsequent contributions of assets. In
furtherance of this acknowledgment, the Borrower agrees that it will take such
actions as are required by the Lender to insure that the Lender's ability to be
repaid is not compromised as a result of the Reorganization."
10. There is hereby added to the Loan Agreement a new Section 5.18, which
provides in its entirety as follows:
"Section 5.18 Year 2000 Compatibility. Borrower shall take all action
necessary to assure that Borrower's computer based systems are able to operate
and effectively process data including dates on and after January 1, 2000. At
the request of the Lender, Borrower shall provide Lender assurance acceptable to
Lender of Borrower's Year 2000 compatibility."
11. The first sentence of Section 6.1 hereof is hereby amended to provide
in its entirety as follows:
"Borrower shall maintain a minimum tangible net worth for each fiscal
quarter equal to or greater than $80 Million Dollars beginning at the fiscal
quarter ending December 31, 1997 and at all times thereafter."
12. Section 6.2 shall be amended to provide in its entirety as follows:
"Borrower shall maintain a minimum Fixed Charge Coverage Ratio calculated
for each fiscal quarter on a rolling basis for the prior 12 month period of not
less than 1.25. As used herein, "Fixed Charge Coverage" shall be calculated as
follows:
Net Income + Depreciation + Amortization + Lease Expense
- --------------------------------------------------------------------------------
((Total Debt including subordinated debt, senior debt, all of balance sheet
obligations, obligations under synthetic leases or other structured financings,
divided by 5) + Interest Expense+Lease Expense," all as calculated in accordance
with GAAP.
13. The second sentence of Section 6.3 is amended to provide in its
entirety as follows:
"Total Capitalization" shall be defined as Senior Debt plus Subordinated
Debt plus all off balance sheet obligations, obligations under synthetic lease
or structured financings plus Equity. For purposes of Section 6.2 and 6.3
hereof, the obligation under a synthetic lease or other structured financing
shall be included even though such obligation may not be a liability under GAAP
and may not be reflected in the financial statements of the Borrower. The
financial covenants in this Article VI and compliance therewith shall be
calculated on a consolidated basis.
14. Section 7.4.1 of the Loan Agreement is hereby amended to provide in its
entirety as follows:
"7.4.1 New Restaurant Expansion. Borrower and its affiliates shall limit
new restaurant expansion to 8 stores in fiscal year 1998. Borrower will not
commit to establish any new restaurants or restaurant expansion in any fiscal
year beyond 1998 unless such stores can be established and supported out of
existing operational cash flow or other finance
3
<PAGE> 4
sources acceptable to Lender and Borrower, and provided in no event shall such
expansion exceed 8 stores after fiscal year 1998."
15. Section 7.6 is amended by adding at the end of that section a new
sentence which provides in its entirety as follows:
"The Borrower shall also not agree with any other party that the Borrower
will not enter into an agreement pursuant to which Borrower will not grant a
lien upon Borrower's property."
16. There is hereby added to the Loan Agreement a new Section 7.26, which
provides in its entirety as follows:
"Section 7.26 No Change of Control. The Borrower shall not take any action
that would transfer Control of any Subsidiary to any other Person, nor shall
Borrower take any action that would result in any ownership or voting interest
in any Subsidiary being transferred to any other Person."
17. Section 8.1(b) is amended to provide it its entirety as follows:
"(b) Representations and Warranties. Lender's determination that any
representation or warranty made by Borrower, any Guarantor or any other party in
any Loan Document was incorrect in any material respect.
18. Section 8.1(c) is amended to provide in its entirety as follows:
"(c) Covenants. Borrower's, Guarantor's or any other parties failure to
perform any covenant contained in the Loan Documents, not subject to any other
provision in this Article VIII, or the occurrence of any Default or Event of
Default denominated as such in any other Loan Document, with such Event of
Default being determined by including cure periods, if any, expressly provided
for in determining if there has occurred an Event of Default."
19. Section 8.1(h) is amended to provide in its entirety as follows:
"Guarantor Documents. The occurrence of an Event of Default under a
Guaranty or the FCLP Pledge Agreement."
20. The Effective Time shall only occur when the Borrower has performed the
following:
(i) delivered to the Lender: (a) the articles of incorporation and limited
partnership agreement of the Guarantors, certified as true and correct by the
Florida Secretary of State or equivalent authority in Ohio in the case of
Southern Cooker Limited Partnership; (b) the by-laws of the Corporate Guarantors
and the resolutions of the board of directors or general partner, as the case
may be, of the Borrower and the Guarantors; (c) a duly executed Guaranty, a duly
executed Pledge Agreement, the duly executed FCLP Pledge Agreement, the stock
and partnership certificates required to be delivered under the Pledge Agreement
or the FCLP Pledge Agreement, together with appropriate stock powers or
assignment; (d) an opinion of counsel to the Borrower and the Guarantors in form
acceptable to the Lender; (e) lien searches from the offices in the
jurisdictions in which a filing would be required to perfect a lien on the
assets of the Borrower or a Guarantor, which search shall demonstrate that there
are no liens on the assets of the Borrower or any Guarantor; (f) the Schedules
and Exhibits required to be prepared hereunder in connection with this
Amendment; (g) appropriate forms of financing statements to perfect the lien of
the Lender in the Collateral provided under the FCLP Pledge Agreement and the
Pledge Agreement; (h) the Indemnity Agreement, and corresponding affidavits of
execution; (i) the financial statements of the Guarantors required under Section
3(h) of each Guaranty; (j) the schedule to the ISDA Master Agreement between the
Lender and Borrower; and (k) an amendment to the Revolving/Term Loan Note;
(ii)payment to the Lender of its fees and expenses incurred in connection
with the negotiation, preparation and closing of this amendment and the actions
ancillary thereto.
4
<PAGE> 5
The "Effective Time" shall be deemed to have occurred when the Lender
delivers this Agreement to the Borrower with the signature of the Lender, which
shall evidence satisfaction of the foregoing requirements.
21. All notices under the Loan Documents shall hereafter be made as
provided in Section 16.2 of the Note and Stock Pledge Agreement.
22. The Borrower agrees that the Agreement is amended to provide that each
representation, warranty and covenant set forth in Articles IV, V and VII of the
Loan Agreement shall be deemed to be a representation, warranty and covenant by
and applicable to each Guarantor, except that (i) references in Section 4.1 of
the Loan Agreement to "Ohio" shall be with respect to the state of incorporation
or organization of the Guarantor and that references in Article IV of the Loan
Agreement to the Loan Documents shall, as applied to the Guarantor, be with
respect to the documents being executed by the Guarantor in connection with the
execution, delivery and performance by the Guarantor of the Guaranty; (ii) the
obligation to provide financial statements and other information under Section
5.1 of the Loan Agreement shall be satisfied by delivery of such information by
the Borrower on a consolidating basis and containing information satisfactory to
Lender to enable Lender to review the financial operations of each Guarantor;
(iii) compliance with the financial covenants shall be determined on a
consolidated basis among the Borrower and its Subsidiaries; (iv) the exceptions
to the negative covenants set forth in Article VI of the Loan Agreement shall
also be calculated on a consolidated basis; and (v) each Guarantor shall
maintain all of its bank accounts with FUNB.
23. The Lender has been informed by the Borrower that (i) the Internal
Revenue Service is auditing the Employee Stock Option Plan (the "ESOP")
established by the Borrower because Borrower failed to provide proxy statements
to certain employees for the years of 1994 and 1995; (ii) Borrower has entered
into sale/lease back transactions with respect to certain point of sale
terminals in which sale price was approximately $700,000; and (iii) Borrower
desires to repurchase approximately 500,000 shares of its outstanding stock to
contribute to the ESOP. The Borrower represents to Lender that such actions will
not have a material, adverse effect upon Borrower on its ability to perform its
obligations, under the Loan Agreement, and Borrower represents that such share
repurchase will be at a price not to exceed the price then quoted for such
shares in the open market. Based upon the foregoing representation, Lender
agrees such action does not constitute an Event of Default.
24. The Borrower represents to the Lender that the Borrower has taken all
action required to authorize the execution, delivery and performance of this
amendment; that the execution, delivery and performance of this amendment do not
violate the articles of incorporation or by-laws of the Borrower, or any
agreement to which Borrower is a party or by which it is bound; that Borrower is
in good standing in each jurisdiction in which Borrower is transaction business;
that no event has occurred that has not been disclosed to the Lender by Borrower
that if it had been disclosed would be material to the Lender's decision to
enter into this amendment; and that no event of default, nor event that with the
passage of time or giving of notice would be an event of default, has occurred
under the Loan Document.
25. Except for the amendments expressly set forth herein, the parties
hereto agree that the Loan Agreement is not otherwise being amended hereby.
COOKER RESTAURANT CORPORATION,
an Ohio corporation
/s/ G. ARTHUR SEELBINDER
-----------------------------------------
By: G. Arthur Seelbinder
Its: Chairman and Chief Executive Officer
5
<PAGE> 6
FIRST UNION NATIONAL BANK
/s/ M. WALKER DUVALL
-----------------------------------------
By: Walker Duvall
Its: Senior Vice President
6
<PAGE> 7
COMMONWEALTH OF THE BAHAMAS
The foregoing instrument was acknowledged before me this 30th day of March
1998, by G. Arthur Seelbinder as Chairman and Chief Executive Office of COOKER
RESTAURANT CORPORATION, an Ohio Corporation, who is personally known to me or
has produced a passport as identification.
/s/ ARTHUR SELIGMAN
---------------------------------------
Notary Public
Name of Notary Printed:
Arthur Seligman
---------------------------------------
(NOTARY SEAL)
My commission expires: 31st December 1998
My commission number is: --------------
COMMONWEALTH OF THE BAHAMAS
The foregoing instrument was acknowledged before me this 30th day of March
1998, by Walker Duvall as Senior Vice President of FIRST UNION NATIONAL BANK, a
national banking association, who is personally known to me.
/s/ ARTHUR SELIGMAN
--------------------------------------
Notary Public
Name of Notary Printed:
Arthur Seligman
--------------------------------------
(NOTARY SEAL)
My commission expires: 31st December 1998
My commission number is: -----------
7
<PAGE> 1
EXHIBIT 10.16
FOURTH AMENDMENT TO REVOLVING/TERM LOAN NOTE
This Fourth Amendment to Revolving/Term Loan Note is executed as of this
1st day of January, 1998, by COOKER RESTAURANT CORPORATION ("Maker"), an Ohio
corporation, and FIRST UNION NATIONAL BANK ("Payee"), a national banking
association, as successor in interest to First Union National Bank of Tennessee.
W I T N E S S E T H:
WHEREAS, Maker has executed that certain Revolving/Term Loan Note (the
"Note") in favor of Payee in the original principal amount of $10,000,000 dated
August 26, 1991; and
WHEREAS, Maker and Payee have previously amended the Note by instrument
dated June 29, 1993, by instrument dated January 11, 1995 and by instrument
dated December 22, 1995; and
WHEREAS, Maker and Payee wish to further amend the Note;
NOW, THEREFORE, in consideration of the foregoing, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. The first paragraph on page one (1) of the Note is deleted in its
entirety and replaced with the following:
For value received, Cooker Restaurant Corporation ("Maker"), an
Ohio corporation, promises to pay to the order of First Union National
Bank ("Payee"), a national banking association, the sum of Thirty-Three
Million and No/100 Dollars ($33,000,000.00), or as much thereof as may
be outstanding from time to time, together with interest thereon at the
rate set forth in that Amended and Restated Loan Agreement dated
December 22, 1995, as amended (the "Loan Agreement"). All amounts
advanced hereunder shall be subject to the terms and conditions of the
Loan Agreement. Provided, finally, on June 30, 1999, all principal and
interest then unpaid shall be finally due and payable.
2. Except as amended hereby, the Note shall remain in full force and
effect. The Fourth Amendment shall be attached to the original Note.
IN WITNESS WHEREOF, the undersigned have executed this Fourth Amendment on
the date first above written.
COOKER RESTAURANT CORPORATION,
Maker
By: /s/ G. ARTHUR SEELBINDER
------------------------------
G. Arthur Seelbinder, Chairman and Chief
Executive Officer
FIRST UNION NATIONAL BANK
By: /s/ M. WALKER DUVALL
------------------------------
Walter Duvall, Senior Vice President
<PAGE> 1
EXHIBIT 10.17
REAFFIRMATION OF AMENDED AND RESTATED GUARANTY
----------------------------------------------
THIS REAFFIRMATION OF AMENDED AND RESTATED GUARANTY ("Reaffirmation")
is made as of the 20th Day of April, 1998, by COOKER RESTAURANT CORPORATION, an
Ohio corporation ("Guarantor").
RECITALS:
---------
A. Chase Manhattan Bank ("Lender") entered into an arrangement with G.
Arthur Seelbinder and Kathleen W. Hammer (collectively, "Borrower") providing
for the extensions of credit to Borrower, which arrangement is evidenced by that
certain Amended and Restated Grid Time Promissory Note dated January 31, 1997
("Note").
B. Pursuant to the terms of the Note, Lender made loans and extensions
of credit to Borrower.
C. In connection with the Note, Guarantor executed that certain Amended
and Restate Guaranty ("Guaranty") dated as even date therewith in favor of and
for the benefit of Lender.
D. Borrower has requested that Lender extend, and Lender has agreed to
extend, the term of the Note by execution of that certain Amendment to Grid time
Promissory Note dated of even date herewith ("Amendment") to extend the maturity
date of the Note until January 31, 1999, in accordance with the terms of the
Amendment.
E. As a condition to Lender's willingness to extend the term of the
Note, Lender has required the execution of this Reaffirmation.
NOW THEREFORE, in order to induce Lender to extend the term of the
Note, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the undersigned Guarantor hereby:
(1) confirms, ratifies and reaffirms in all respects the Guaranty, and
acknowledges that such Guaranty is in full force and effect;
(2) represents and warrants to Lender that (a) all representations and
warranties to Lender in the Guaranty are true and correct on this date, as if
made on this date, except to the extent any of them expressly relate to an
earlier date; (b) Guarantor is not in default under the Guaranty, and no event
has occurred that, with notice or lapse of time or both, would constitute such
an event of default; and (c) since the date of the most recent financial
statements delivered to Lender, there has not been any material adverse change
in Guarantor's financial condition;
(3) acknowledges that Guarantor's liability under the Guaranty is not
affected or diminished in any manner by the terms of the Note, as amended
pursuant to the Amendment, or by any other documents executed in connection
therewith, and that Guarantor's liability includes, without limitation,
Borrower's obligations under and pursuant to the Note, as amended pursuant to
the Amendment;
(4) agrees that, by requesting this Reaffirmation, Lender will not be
deemed to have waived any of its rights to enforce the Guaranty upon any
subsequent modification of the terms of the extensions of credit or the
documents evidencing and securing them, whether or not a similar ratification is
executed at the time of such subsequent modification; and
<PAGE> 2
(5) KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE OR MIGHT ACQUIRE TO TRIAL BY JURY IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM, OR OTHER LITIGATION ("ACTION") BASED UPON OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THE GUARANTY OR ANY RELATED DOCUMENTS, INSTRUMENTS
OR AGREEMENTS (WHETHER ORAL OR WRITTEN AND WHETHER EXPRESS OR IMPLIED AS A
RESULT OF A COURSE IN DEALING, A COURSE OF CONDUCT, A STATEMENT, OR OTHER ACTION
OF EITHER PARTY); AND THE UNDERSIGNED GUARANTOR SHALL N OT SEEK TO CONSOLIDATE
ANY SUCH ACTION (IN WHICH A JURY TRIAL HAS BEEN WAIVED) WITH ANY OTHER ACTION IN
WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE UNDERSIGNED GUARANTOR
ACKNOWLEDGES THAT IT HAS NOT IN ANY WAY AGREED WITH OR REPRESENTED TO LENDER
THAT THE PROVISIONS OF THIS SECTION WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
THE PROVISIONS IN THIS SECTION ARE A MATERIAL INDUCEMENT TO LENDER'S EXTENDING
THE TERM OF THE NOTE. THE PROVISIONS IN THIS SECTION WILL BE BINDING UPON THE
HEIRS, SUCCESSORS, ASSIGNS, AND PERSONAL REPRESENTATIVES OF THE UNDERSIGNED
GUARANTOR.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 3
IN WITNESS WHEREOF, Guarantor has executed this Reaffirmation as of the
date first above written.
WITNESSES: "GUARANTOR"
COOKER RESTAURANT
/s/ Glenn W. Cockburn CORPORATION, an Ohio Corporation
- ----------------------------
(Signature)
By: /s/ Phillip L. Pritchard (SEAL)
--------------------------------
Name: Phillip L. Pritchard
--------------------------------
Glenn W. Cockburn Title: President, C.O.O.
- ----------------------------- --------------------------------
(Printed Name)
/s/ M. A. Epperson
- ----------------------------
(Signature)
M. A. Epperson
- ----------------------------
(Printed Name)
<PAGE> 1
EXHIBIT 10.18
Chase Manhattan Private Bank, N.A.
205 Royal Palm Way
Palm Beach, FL 33480
March 26, 1998
Mr. G. Arthur Seelbinder
Ms. Kathleen Hammer
5500 Village Boulevard
West Palm Beach, Florida 33407
Dear Arthur and Kathleen:
On behalf of our affiliate, The Chase Manhattan Bank ("the Bank"), I am pleased
to inform you that the Bank is prepared to extend the maturity of your loan to
January 31, 1999 subject to the following terms and conditions:
Loan Amount: up to $6,250,000.00
- ------------
Loan Type: Advised Line of Credit
- ----------
Pricing: LIBOR + 2.00% or Prime Rate (Borrower's option)
- -------
Term: January 31, 1999 (annually renewable from this date
- ---- forward at the Bank's option)
Guarantor: Cooker Restaurant Corporation
- ----------
Facility Fee: None
- -------------
Collateral:
- -----------
A perfected first priority security interest in 570,000 shares of Cooker
Restaurant Corporation ("CGR"). The Maximum Advance Rate shall be 95% times
the market value of the CGR stock collateral. The Bank shall have the right
to modify the Maximum Advance Rate and the acceptability of the collateral
("Eligible Collateral") at any time.
In the event that the value of the Eligible Collateral shall decline with
the effect that the Loan Value defined below shall be less than the amount
of the loan balance outstanding, the Bank, at its option: will require the
Borrower to either 1) provide additional collateral acceptable to the Bank
its sole discretion; or 2) to make a principal payment to the extent
necessary to ensure that the aggregate outstanding loan balances are in
compliance with the Maximum Advance Rate(s); or, if the Borrower shall fail
to provide additional acceptable collateral or make a principal payment on
the loan, the Bank may sell that portion of the collateral and apply the
proceeds to the outstanding loans in an amount sufficient to ensure
compliance with the Maximum Advance Rate(s).
"Loan Value" shall mean the advance rate, as determined by the Bank from
time to time, assigned to each type of Eligible Collateral. Collateral may
be sold by the Bank without regard to the Borrower's basis or holding
period.
Principal Amortization: None, this loan shall be interest only.
- -----------------------
<PAGE> 2
Conditions: This loan will have no prepayment penalty
- ----------- (excepting LIBOR provisions, if any)
This facility shall be cross-collateralized and
cross-defaulted with any other loan facility extended
to the Borrowers by The Chase Manhattan Bank or its
affiliates.
Events of Default:
- ------------------
o Non-payment of Chase principal and/or interest when due.
o Material adverse change in Borrowers' financial condition.
o Failure to deliver personal financial statement with footnotes and
schedules or personal tax returns with schedules on an annual basis.
o Bankruptcy or insolvency of Borrowers
o Failure to deliver any other financial information that the Bank may
reasonably request.
o Death of Borrower with a 7 month cure period granted to the estate
If you are in agreement with the foregoing, please sign and return the enclosed
duplicate original of this letter. This letter may be executed in counterparts
which, taken together, shall constitute an original. This letter will be
governed by and construed in accordance with the laws of the State of New York
without regard to the principles of conflicts of laws.
Very truly yours,
/s/ Richard M. Ditizio
------------------------------
Richard M. Ditizio
Vice President
ACCEPTED AND AGREED:
- --------------------
/s/ G. Arthur Seelbinder /s/ Kathleen W. Hammer
- ------------------------------ ------------------------------
G. Arthur Seelbinder Kathleen W. Hammer
GUARANTOR
/s/ Phillip L. Prichard
- ------------------------------
Cooker Restaurant Corporation
By: Phillip L. Pritchard
--------------------------
Its: President
-------------------------
<PAGE> 1
EXHIBIT 10.19
AMENDMENT TO
GRID TIME PROMISSORY NOTE
THIS, AMENDMENT, dated as of March 26, 1998 (the "Amendment"), is by and between
THE CHASE MANHATTAN BANK (the "Bank") and G. Arthur Seelbinder and Kathleen W.
Hammer (together, the "Borrower").
The Bank and the Borrower have entered into a Grid Time Promissory Note dated
January 31, 1997 in the amount of $6,250,000 (the "Note"). The Bank and the
Borrower desire to amend the Note to modify its maturity.
Except as otherwise provided herein, the capitalized terms used in this
Amendment shall have the respective meanings assigned to such terms in this
Note.
AGREEMENT
---------
In consideration of the foregoing, and the mutual covenants and agreements
hereinafter set forth, the parties hereto hereby agree as follows:
1. AMENDMENT. This Note is hereby amended as follows:
For value received, G. Arthur Seelbinder and Kathleen Hammer, (together, the
"Borrower") hereby promise to pay to the order of The Chase Manhattan Bank (the
"Bank") with an office at 1211 Avenue of the Americas, New York, New York 10036
for the account of the lending office of the Bank set forth on the signature
page hereof (the "Lending Office"), the principal amount of SIX MILLION TWO
HUNDRED FIFTY THOUSAND DOLLARS ($6,250,000.00) or, if less, the principal amount
of each loan (the "Loans") endorsed on the schedule attached hereto and made a
part hereof (including any continuation thereof, the "Schedule") on the maturity
date of such Loan (which shall be (i) one, two, three, or six calendar months
after the date of such Loan, in the case of a Eurodollar Loan, in each case as
the borrower may select, or (ii) one calendar month after the date of a Prime
Loan; each a "Maturity Date"). Excepting receipt by the Bank of notice from the
Borrower indicating an alternate selection, the one month Eurodollar rate shall
be utilized. The credit facility evidenced by this Note shall expire on January
31, 1999, unless extended in writing by the Bank.
2. CONDITIONS PRECEDENT. This Amendment shall not become effected until the Bank
has received executed counterparts of this Amendment signed by each of the
parties hereto.
3. CONTINUED EFFECTIVENESS. Except to the extent expressly amended hereby, all
of the terms of the Note remain in full force and effect.
4. APPLICABLE LAW. This Amendment shall be governed by, and construed in
accordance with the laws of the State of New York.
<PAGE> 2
5. COUNTERPARTS. This Amendment may be executed in two or more counterparts,
each of which shall constitute an original, but all of which when taken together
shall constitute but one agreement.
IN WITNESS WHEREOF, the Bank and the Borrower have duly executed this Amendment,
all as of the day and year first above written.
/s/ G. Arthur Seelbinder /s/ Kathleen Hammer
- ----------------------------- -----------------------------
G. ARTHUR SEELBINDER KATHLEEN W. HAMMER
AGREED TO:
THE CHASE MANHATTAN BANK
By: /s/ John W. Blackman
- -----------------------------
Name: John W. Blackman
-------------------
Title: Managing Director
------------------
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<PERIOD-START> DEC-30-1996
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-03-1999
<PERIOD-START> DEC-29-1997
<PERIOD-END> MAR-29-1998
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0
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