<PAGE> 1
THE FOLLOWING ITEM WAS THE SUBJECT OF A FORM 12-B-25
AND IS INCLUDED HEREIN:
ITEM 14(A)(1). INDEPENDENT AUDITORS' REPORT
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------
FORM 10-K/A
----------------
AMENDMENT NUMBER 2
TO
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended: December 29, 1996 Commission file number: 1-13044
COOKER RESTAURANT CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
OHIO 62-1292102
- ----------------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
5500 Village Boulevard, West Palm Beach, Florida 33407
- ------------------------------------------------------------- -------------
(State or other jurisdiction of incorporation or organization) (Zip Code)
Registrant's telephone number, including area code: (561) 615-6000
Securities registered pursuant to Section 12(b) of the Act:
Title of Class Name of exchange on which registered
-------------- ------------------------------------
Common Shares, without par value The New York Stock Exchange
- --------------------------------------------------------------------------------
Rights to Purchase Class A Junior Participating Trades with the Common Shares
Preferred Shares, without par value
- --------------------------------------------------------------------------------
Securities registered pursuant to Section 12(g) of the Act:
6 3/4% Convertible Subordinated Debentures Due 2002
- --------------------------------------------------------------------------------
(Title of Class)
Amendment Number 1 to Annual Report on Form 10-K for the fiscal year
ended December 29, 1996 ("Amendment 1") was filed by the Registrant in order to
file a revised Independent Auditors' Report (the "Report") of KPMG Peat Marwick
LLP ("KPMG") to replace the independent auditors' report which was originally
filed in the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 29, 1996 ("1996 Form 10-K") and to file KPMG's Consent. The independent
auditors' report in the 1996 Form 10-K covered only the Financial Statements for
the fiscal year ended December 29, 1996. The Report filed as part of Amendment
Number 1 covered the Financial Statements for the three fiscal years ended
December 29, 1996. The report of Price Waterhouse LLP, the Registrant's
predecessor accountants, on the Financial Statements for the fiscal years ended
January 1, 1995 and December 31, 1995 was unavailable at the time the Registrant
filed the 1996 Form 10-K and was omitted from the 1996 Form 10-K pursuant to
Rule 12b-25(e)(1). There are no changes to the Financial Statements for the
three fiscal years ended December 29, 1996 which were filed as part of the 1996
Form 10-K. This Amendment Number 2 to the 1996 Form 10-K is being filed by the
Registrant to file the Report and the Financial Statements in the same amendment
in accordance with Rule 12b-15 of the Exchange Act of 1934.
<PAGE> 2
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(A) DOCUMENTS FILED AS PART OF THIS FORM 10-K.
(1) FINANCIAL STATEMENTS:
Independent Auditors' Report (filed herewith)
Balance Sheet as of December 29, 1996 and December 31, 1995 (filed herewith)
Statement of Income for the Fiscal Years Ended December 29, 1996, December 31,
1995 and January 1, 1995 (filed herewith)
Statement of Changes in Shareholders' Equity for the Fiscal Years Ended December
29, 1996, December 31, 1995 and January 1, 1995 (filed herewith)
Statement of Cash Flows for the Fiscal Years Ended December 29, 1996, December
31, 1995, and January 1, 1995 (filed herewith)
Notes to Financial Statements for the Fiscal Years Ended December 29, 1996,
December 31, 1995, and January 1, 1995 (filed herewith)
(3) THE FOLLOWING EXHIBITS ARE FILED AS PART OF THIS FORM 10-K.
(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 quarterly period ended March 29, 1992; Commission File Number 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).
(4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS.
Exhibit 4.1.
See Articles FOURTH, FIFTH and SIXTH of the Amended and Restated Articles of
Incorporation of the Registrant (see 3.1 above).
2
<PAGE> 3
Exhibit 4.2.
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see 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 Registrant and First Union National Bank of Tennessee. (see 10.4
below).
Exhibit 4.8.
Indenture dated as of October 28, 1992 between 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 Number 0-16806).
3
<PAGE> 4
(10) MATERIAL CONTRACTS (*Management contract or compensatory plan or
arrangement.)
Exhibit 10.1.
Purchase and Sale Agreement dated October 20, 1995 between GMRI, Inc. and
Registrant (incorporated by reference to Exhibit 99.1 of the Registrant's
Current Report on Form 8-K dated January 4, 1996 (the "1996 8-K"); Commission
File No. 1-13044).
Exhibit 10.2.
First Amendment to Purchase and Sale Agreement dated October [ ], 1995 between
GMRI, Inc. and Registrant (incorporated by reference to Exhibit 99.2 of the 1996
8-K; Commission File No. 1-13044).
Exhibit 10.3.
Joinder of Escrow Agreement dated October 25, 1995 among Lawyers Title Insurance
Corporation, GMRI, Inc. and Registrant (incorporated by reference to Exhibit
99.3 of the 1996 8-K; Commission File No. 1-13044).
Exhibit 10.4.
Amended and Restated Loan Agreement dated December 22, 1995 between 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 (the "1995 Form 10-K"), Commission File No. 0-16806).
Exhibit 10.5.
Underwriting Agreement dated May 7, 1996 with Montgomery Securities and
Equitable Securities Corporation (incorporated by reference to Exhibit 10.1 to
the Registrant's quarterly report on Form 10-Q for the quarter ended June 30,
1996 (the "June 1996 Form 10-Q"), Commission File No. 0-16806).
Exhibit 10.6.
Form of Contingent Employment Agreement and schedule of executed Agreements
(incorporated by reference to Exhibit 10.5 of the 1995 Form 10-K).*
Exhibit 10.7.
The Registrant's 1988 Employee Stock Option Plan and 1992 Employee Stock Option
Plan, Amended and Restated April 22, 1996, (incorporated by reference to Exhibit
10.2 to the June 1996 Form 10-Q, Commission File No. 0- 16806).*
Exhibit 10.8.
The Registrant's 1988 Directors Stock Option Plan, as amended and restated
(previously filed).
4
<PAGE> 5
Exhibit 10.9.
The Registrant's 1992 Directors Stock Option Plan, as amended and restated
(previously filed).*
Exhibit 10.10.
The Registrant's 1996 Officers' Stock Option Plan (incorporated by reference to
Exhibit 10.10 of the 1995 Form 10-K).*
Exhibit 10.11.
Reaffirmation and Amendment to Guaranty and Suretyship Agreement between
Registrant and NationsBank of Tennessee, N.A. dated July 24, 1995 (incorporated
by reference to Exhibit 10.5 of the Registrant's Quarterly Report on Form 10-Q
for the quarterly period ended July 2, 1995; Commission File No. 1-13044).
Exhibit 10.12.
Amended and Restated Guaranty between Registrant and Chase Manhattan Bank dated
January 31, 1997 (previously filed).
Exhibit 10.13.
Letter dated February 3, 1997 from G. Arthur Seelbinder to the Registrant
(previously filed).
(16) LETTER REGARDING CHANGE IN CERTIFYING ACCOUNTANT.
Exhibit 16.1.
Letter dated August 14, 1996 from Price Waterhouse LLP to the Securities and
Exchange Commission (incorporated by reference to Exhibit 16.1 to the
Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June
30, 1996; Commission File No. 1-13044).
(23) CONSENT OF EXPERTS AND COUNSEL.
Exhibit 23.1.
Consent of KPMG Peat Marwick LLP.
(24) POWERS OF ATTORNEY.
Exhibit 24.1.
Powers of Attorney (previously filed).
5
<PAGE> 6
Exhibit 24.2
Certified resolution of the Registrant's Board of Directors authorizing officers
and directors signing on behalf of the Registrant to sign pursuant to a power of
attorney (previously filed).
(27) FINANCIAL DATA SCHEDULE.
Exhibit 27.1.
Financial Data Schedule (submitted electronically for SEC information only;
previously filed).
(B) REPORTS ON FORM 8-K.
No current report on Form 8-K was filed by the Registrant during the fourth
quarter of fiscal 1996.
6
<PAGE> 7
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this amendment to report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Dated: March 2, 1998
COOKER RESTAURANT CORPORATION
(the "Registrant")
By: /s/ G. Arthur Seelbinder
----------------------------------------
G. Arthur Seelbinder
Chairman of the Board,
Chief Executive Officer and Director
(principal executive officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this
amendment to report has been signed below by the following persons on behalf of
the registrant and in the capacities indicated on February 23, 1998.
SIGNATURE TITLE
/s/ G. Arthur Seelbinder Chairman of the Board, Chief
- -------------------------------- Executive Officer and Director
G. Arthur Seelbinder (principal executive officer)
/s/Phillip L. Pritchard* President, Chief Operating Officer
- -------------------------------- and Director
Phillip L. Pritchard
/s/ Glenn W. Cockburn* Senior Vice President - Operations
- -------------------------------- and Director
Glenn W. Cockburn
/s/ David C. Sevig* Vice President - Chief Financial
- -------------------------------- Officer (principal financial and
David C. Sevig accounting officer)
/s/ Robin V. Holderman* Director
- --------------------------------
Robin V. Holderman
/s/ David T. Kollat* Director
- --------------------------------
David T. Kollat
/s/ David L. Hobson* Director
- --------------------------------
David L. Hobson
/s/ Henry R. Hillenmeyer* Director
- --------------------------------
Henry R. Hillenmeyer
/s/ Margaret T. Monaco* Director
- --------------------------------
Margaret T. Monaco
s/ Harvey Palash* Director
- --------------------------------
Harvey Palash
*By: /s/ G. Arthur Seelbinder
- --------------------------------
G. Arthur Seelbinder
Attorney-in-Fact
7
<PAGE> 8
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
COOKER RESTAURANT CORPORATION
-----------------------
FORM 10-K ANNUAL REPORT
AMENDMENT NUMBER 2
FOR THE FISCAL YEAR ENDED:
DECEMBER 29, 1996
-----------------------
FINANCIAL STATEMENTS
-----------------------
================================================================================
<PAGE> 9
COOKER RESTAURANT CORPORATION
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Independent Auditors' Report............................................................................ F-2
Balance Sheet as of December 29, 1996 and December 31, 1995............................................. F-3
Statement of Income for the fiscal years ended December 29, 1996, December 31, 1995,
and January 1, 1995........................................................................... F-4
Statement of Changes in Shareholders' Equity for the fiscal years ended December 29, 1996,
December 31, 1995 and January 1, 1995......................................................... F-5
Statement of Cash Flows for the fiscal years ended December 29, 1996, December 31, 1995
and January 1, 1995........................................................................... F-6
Notes to Financial Statements........................................................................... F-7
</TABLE>
F-1
<PAGE> 10
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders
Cooker Restaurant Corporation
We have audited the accompanying balance sheets of Cooker Restaurant Corporation
(the "Company") as of December 29, 1996 and December 31, 1995, and the related
statements of income, changes in shareholders' equity and cash flows for each of
the years in the three year period ended December 29, 1996. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Cooker Restaurant Corporation
as of December 29, 1996 and December 31, 1995, and the results of its operations
and its cash flows for each of the years in the three year period ended December
29, 1996, in conformity with generally accepted accounting principles.
/s/ KPMG Peat Marwick LLP
May 9, 1997
Fort Lauderdale, Florida
F-2
<PAGE> 11
COOKER RESTAURANT CORPORATION
BALANCE SHEETS
(Dollar amounts in thousands)
December 29, 1996 and December 31, 1995
<TABLE>
<CAPTION>
Assets 1996 1995
------ ---- ----
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 2,009 1,299
Inventory 1,128 914
Land held for sale 1,560 882
Preoperational costs 749 302
Prepaid expenses and other current assets 585 511
---------- --------
Total current assets 6,031 3,908
Property and equipment, net 107,010 77,245
Other assets 1,592 2,028
---------- --------
$ 114,633 83,181
========== ========
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Note payable $ 4,613 -
Accounts payable 3,845 2,421
Accrued liabilities 6,030 5,543
Income taxes payable 991 783
Deferred income taxes - 79
---------- --------
Total current liabilities 15,479 8,826
Long-term debt 16,822 35,976
Deferred income taxes 582 433
---------- --------
Total liabilities 32,883 45,235
---------- --------
Shareholders' equity:
Common share-without par value; authorized, 30,000,000
shares; issued 10,548,000 and 7,663,000 shares at December
29, 1996 and December 31, 1995, respectively 63,583 26,082
Retained earnings 24,316 18,013
Treasury stock, at cost, 513,000 shares at December 29, 1996
and December 31, 1995 (6,149) (6,149)
---------- --------
81,750 37,946
---------- --------
Commitments and contingencies
$ 114,633 83,181
========== ========
</TABLE>
See accompanying notes to financial statements
F-3
<PAGE> 12
COOKER RESTAURANT CORPORATION
STATEMENT OF INCOME
(In thousands, except per share data)
Fiscal years ended December 29, 1996, December 31, 1995 and January 1, 1995
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Sales 110,273 91,678 84,169
------- ------ ------
Cost of sales:
Food and beverage 31,322 26,218 24,193
Labor 38,074 31,977 31,389
Restaurant operating expenses 18,470 15,065 13,549
Restaurant depreciation and amortization 4,624 3,957 5,030
------- ------ ------
92,490 77,217 74,161
Restaurant operating income 17,783 14,461 10,008
Other expenses (income):
General and administrative 6,149 5,785 4,532
Interest expense 1,278 1,848 1,787
Loss (gain) on sale of property 2 (305) -
Interest and other income (167) (30) (72)
------- ------ ------
7,262 7,298 6,247
------- ------ ------
Income before income taxes and extraordinary item 10,521 7,163 3,761
Provision for income taxes before extraordinary item 3,789 2,731 1,280
------- ------ ------
Income before extraordinary item 6,732 4,432 2,481
Extraordinary gain, net of income taxes - - 484
------- ------ ------
Net income 6,732 4,432 2,965
======= ====== ======
Earning per common share:
Before extraordinary item .72 .60 .34
Extraordinary item - - .07
------- ------ ------
Total .72 .60 .41
======= ====== ======
Weighed average number of common shares and common equivalent
shares outstanding 9,384 7,387 7,254
======= ====== ======
</TABLE>
See accompanying notes to financial statements
F-4
<PAGE> 13
COOKER RESTAURANT CORPORATION
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(Dollar and share amounts in thousands)
Fiscal years ended December 29, 1996, December 31, 1995 and January 1, 1995
<TABLE>
<CAPTION>
Common shares Treasury stock
----------------- Retained ----------------------------
Shares Amounts earnings Shares Amounts Total
------ ------- -------- ------ ------- -----
<S> <C> <C> <C> <C> <C> <C>
Balance, January 2, 1994 7,646 $25,975 $11,340 105 $(1,347) $35,968
Purchase of treasury stock - - - 395 (4,687) (4,687)
Issuance of common shares
under stock option plans 5 22 - - - 22
Tax benefits of stock options
exercised - 6 - - - 6
Dividends paid $.05 per share - - (366) - - (366)
Net income - - 2,965 - - 2,965
-------- -------- -------- ------ -------- --------
Balance, January 1, 1995 7,651 26,003 13,939 500 (6,034) 33,908
Addition to treasury stock - - - 13 (115) (115)
Issuance of common shares
under stock option plans 12 52 - - - 52
Tax benefits of stock options
exercised - 27 - - - 27
Dividends paid $.05 per share - - (358) - - (358)
Net income - - 4,432 - - 4,432
-------- -------- -------- ------ -------- --------
Balance, December 31, 1995 7,663 26,082 18,013 513 (6,149) 37,946
Issuance of common shares
under stock option plans 10 59 - - - 59
Proceeds from secondary
offering 2,875 37,442 - - - 37,442
Dividends paid $.06 per share - - (429) - - (429)
Net income - - 6,732 - - 6,732
-------- -------- -------- ------ -------- --------
Balance, December 29, 1996 10,548 $63,583 $24,316 513 $(6,149) $81,750
======== ======== ======== ====== ======== ========
</TABLE>
See accompanying notes to financial statements
F-5
<PAGE> 14
COOKER RESTAURANT CORPORATION
STATEMENT OF CASH FLOWS
(Dollar amounts in thousands)
Fiscal years ended December 29, 1996, December 31, 1995 and January 1, 1995
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Cash flows from operating activities:
Net income 6,732 4,432 2,965
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 4,975 4,375 5,464
(Gain) loss on sale of property 2 (305) -
Gain on repurchase of debentures, net of income
taxes - (23) (484)
(Increase) decrease in:
Inventory (214) (84) (192)
Preoperational costs (1,402) (444) (1,348)
Prepaid expenses and other current assets (74) 237 (327)
Other assets 436 (276) (131)
Increase (decrease) in:
Accounts payable 1,424 460 683
Accrued liabilities 487 1,110 475
Income taxes payable 208 175 625
Deferred income taxes 70 (162) (159)
------- ------- -------
Net cash provided by operating activities 12,644 9,495 7,571
------- ------- -------
Cash flows from investing activities:
Purchases of property and equipment (34,997) (17,200) (11,318)
Proceeds from sales of property and equipment 532 459 206
Proceeds from sales of short-term investments - - 749
------- ------- -------
Net cash used in investing activities (34,465) (16,741) (10,363)
------- ------- -------
Cash flows from financing activities:
Proceeds from note payable 6,150 - -
Payment on note payable (1,537) - -
Net borrowings (repayments) under revolving line of
credit (17,397) 8,811 9,300
Repurchase of debentures (1,357) (1,180) (1,200)
Redemption of debentures (400) (893) (975)
Exercise of stock options 59 78 22
Proceeds from secondary offering 37,442 - -
Purchases of treasury stock - - (6,034)
Dividends paid (429) (358) (366)
------- ------- -------
Net cash provided by financing activities 22,531 6,458 747
------ ------- --------
Net (decrease) increase in cash and cash equivalents 710 (788) (2,045)
Cash and cash equivalents, at beginning of year 1,299 2,087 4,132
------- ------- -------
Cash and cash equivalents, at end of year 2,009 1,299 2,087
======= ======= =======
</TABLE>
See accompanying notes to financial statements
F-6
<PAGE> 15
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
December 29, 1996, December 31, 1995 and January 1, 1995
(1) DESCRIPTION OF THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Cooker Restaurant Corporation (the "Company") operates 47 restaurants
in Tennessee, Ohio, Indiana, Kentucky, Michigan, Florida, Georgia,
North Carolina, Virginia and Maryland which have been developed under
the Cooker concept.
(A) FISCAL YEAR
The Company's fiscal year ends on the Sunday closest to December
31 of each year. Fiscal years 1996, 1995 and 1994 consisted of
52 weeks.
(B) CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash on hand, in banks and
credit card receivables. Credit card receivables are considered
cash equivalents because of their short collection period. The
carrying amount of cash equivalents approximates fair value.
(C) INVENTORIES
Inventories consist primarily of food and beverages and are
stated at the lower of cost or market. Cost is determined using
the first-in, first-out (FIFO) method.
(D) PREOPERATIONAL COSTS
Preoperational costs consist primarily of costs for employee
training and relocation and supplies incurred in connection with
the opening of each restaurant. These costs are accumulated to
the date the restaurant is opened and are amortized on the
straight-line method over one year commencing from that date.
Amortization of preoperational costs was $949,027, $823,093, and
$2,254,268 for the years ended December 29, 1996, December 31,
1995 and January 1, 1995, respectively.
(E) PROPERTY AND EQUIPMENT
Property and equipment, including capital improvements, are
recorded at cost. Depreciation is calculated on the
straight-line method over the estimated useful lives of the
assets. Leasehold improvements are amortized using the
straight-line method over the shorter of the useful life of the
improvements or the remaining lease term.
Maintenance and repairs are charged directly to expense as
incurred. When property and equipment are sold or otherwise
disposed of, the related cost and accumulated depreciation are
removed from the accounts and the resulting gains or losses are
reported in operations.
Interest is capitalized primarily in connection with the
construction of new restaurants. Capitalized interest is
amortized over the asset's estimated useful life. Interest costs
of $618,000 and $291,000 were capitalized in fiscal 1996 and
1995, respectively.
F-7
<PAGE> 16
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
(F) DEFERRED FINANCING COSTS
Deferred financing costs are being amortized by the interest
method using the effective interest rate implicit in the
borrowing transaction. Interest expense was $130,000, $130,368,
and $141,978 for the years ended December 29, 1996, December 30,
1995 and January 1, 1995, respectively.
(G) PREPAID LEASE
Prepaid lease represents prepayment of a long-term land lease
and is being amortized over the lease term.
(H) INCOME TAXES
The Company accounts for income taxes under the provisions of
Financial Accounting Standards ("SFAS") No. 109, Accounting for
Income Taxes, which generally requires recognition of deferred
tax assets and liabilities for the expected future tax
consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax
assets and liabilities are determined based on differences
between the financial reporting and tax bases of assets and
liabilities, and are measured by applying enacted tax rates and
laws for the taxable years in which those differences are
expected to reverse. In addition, SFAS No. 109 requires
adjustment of previously deferred income taxes for changes in
tax rates under the liability method.
(I) EARNINGS PER SHARE
Earnings per share is computed by dividing net income by the
weighted average number of common shares outstanding including
common share equivalents, which consist of stock options. The
convertible subordinated debentures have not been included as
common share equivalents due to their antidilutive effect.
(J) USE OF ESTIMATES
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.
(K) FINANCIAL INSTRUMENTS
The carrying amount of cash and cash equivalents, accounts
payable and other current liabilities, and the revolving line of
credit approximates fair value because of the short maturity of
these instruments. The fair value of the convertible
subordinated debentures is estimated by discounting future cash
flows at rates currently offered to the Company for similar
types of borrowing arrangements. The carrying amount and fair
value of the convertible subordinated debentures are
$16,113,000 and $14,660,000, respectively, at December 29, 1996
and $17,870,000 and $15,569,000, respectively, at
December 31, 1995.
(L) IMPAIRMENT OF LONG-LIVED ASSETS AND LONG-LIVED ASSETS TO BE
DISPOSED OF
The Company adopted the provisions of SFAS No. 121, Accounting
for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of, on January 1, 1996. This Statement
requires that long-lived assets and certain identifiable
intangibles be reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an
asset may not
F-8
<PAGE> 17
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
be recoverable. Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of an asset to
future net cash flows expected to be generated by the asset. If
such assets are considered to be impaired, the impairment to be
recognized is measured by the amount by which the carrying
amount of the assets exceed the fair value of the assets. Assets
to be disposed of are reported at the lower of the carrying
amount or fair value less costs to sell. Adoption of this
Statement did not have a material impact on the Company's
financial position, results of operations or liquidity.
(M) STOCK OPTION PLAN
Prior to January 1, 1996, the Company accounted for its stock
option plans in accordance with the provisions of Accounting
Principles Board ("APB") Opinion No. 25, Accounting for Stock
Issued to Employees, and related interpretations. As such,
compensation expense would be recorded on the date of grant only
if the current market price of the underlying stock exceeded the
exercise price. On January 1, 1996, the Company adopted SFAS No.
123, Accounting for Stock-Based Compensation, which permits
entities to recognize as expense over the vesting period the
fair value of all stock-based awards on the date of grant.
Alternatively, SFAS No. 123 also allows entities to continue to
apply the provisions of APB Opinion No. 25 and provide pro forma
net income and pro forma earnings per share disclosures for
employee stock option grants made in 1995 and future years as if
the fair-value-based method defined in SFAS No. 123 had been
applied. The Company has elected to continue to apply the
provisions of APB Opinion No. 25 and provide the pro forma
disclosure provisions of SFAS No. 123.
(N) RECLASSIFICATIONS
Certain amounts in the 1995 financial statements have been
reclassified to conform to the 1996 presentation.
(2) PROPERTY AND EQUIPMENT, NET
Property and equipment, net, consists of the following:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995 Useful life
---- ---- -----------
(in thousands)
<S> <C> <C> <C>
Land $ 26,997 19,595 -
Buildings and leasehold improvements 59,244 43,097 20-40 years, or shorter
of lease term
Furniture, fixtures and equipment 21,169 16,836 5-8 years
Construction in progress 16,916 11,013 -
-------- ------
124,326 90,541
Less accumulated depreciation and
amortization (17,316) (13,296)
-------- ------
Property and equipment, net $ 107,010 77,245
======== ======
</TABLE>
F-9
<PAGE> 18
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
(3) OTHER ASSETS
Other assets consist of the following:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Deferred financing costs, net of accumulated
amortization of $703,000 and $573,000 $ 603 764
Prepaid lease, net of accumulated amortization of
$60,000 and $46,000 629 643
Advances to employee stock ownership plan - 270
Liquor licenses, net of accumulated amortization of
$91,000 and $90,000 234 209
Other 126 142
------ ------
$ 1,592 2,028
====== ======
</TABLE>
(4) ACCRUED LIABILITIES
Accrued liabilities consist of the following:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Salaries, wages and benefits $ 3,073 2,707
Gift certificates payable 728 608
Sales tax payable 738 466
Property taxes 214 298
Insurance 743 759
Other 534 705
------ ------
$ 6,030 5,543
====== ======
</TABLE>
(5) NOTE PAYABLE
On September 20, 1996, the Company issued a promissory note to finance
the purchase of property in the amount of $6,150,000, payable in four
equal installments of $1,537,500 through May 1997, and secured by an
irrevocable standby letter of credit.
F-10
<PAGE> 19
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
(6) LONG-TERM DEBT
Long-term debt consists of the following:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Convertible subordinated debentures $ 16,113 17,870
Revolving line of credit 709 18,106
-------- ------
$ 16,822 35,976
======== ======
</TABLE>
The convertible subordinated debentures (the "Debentures") mature
October 1, 2002, with interest payable quarterly at 6.75 percent. The
Debentures are convertible at any time before maturity, unless
previously redeemed, into common shares of the Company at a conversion
price of $21.5625 per share, subject to adjustment for stock splits.
The Debentures are subordinated to all existing and future senior
indebtedness of the Company as defined in the indenture agreement.
At the holder's option, the Company is obligated to redeem debentures
tendered during the period from August 1 through October 1 of each
year, commencing August 1, 1994, at 100 percent of their principal
amount plus accrued interest, subject to an annual aggregate maximum
(excluding the redemption option on the death of the holder) of
$1,150,000. During fiscal years 1996 and 1995, the Company redeemed the
annual aggregate maximum amount required by the holder's option. The
Company is also required to redeem debentures at 100 percent of their
principal plus accrued interest in the event of death of a debenture
holder up to a maximum of $25,000 per year per deceased debenture
holder. During fiscal years 1996 and 1995, the Company redeemed
debentures subject to this provision of $207,000 and $30,000,
respectively.
The Debentures are redeemable at any time on or after October 1, 1994
at the option of the Company, in whole or in part, at declining
premiums. In addition, upon the occurrence of certain changes of
control of the Company, the Company is obligated to purchase Debentures
at the holder's option at par plus accrued interest. For the year ended
January 1, 1995, the Company recorded an extraordinary gain of $734,000
($484,000 after taxes) in connection with the repurchase of debentures
in the principal amount of $2,500,000. The gain on 1995 and the 1996
redemptions was not material. These transactions were financed through
funds available under the revolving line of credit.
On December 22, 1995, the Company entered into a revolving/term loan
under an amended and restated loan agreement (the "Agreement") with a
bank for borrowings up to $33,000,000. Borrowings under the Agreement
may be used for general working capital purposes and costs incurred in
expansion of the restaurant business. The Agreement is secured by
certain properties owned by the Company. Beginning January 1, 1998,
borrowing availability will be reduced quarterly by a maximum of
$1,650,000.
The agreement matures December 31, 1998 and bears quarterly interest
payments at the Company's option of LIBOR plus 1.25 percent up to LIBOR
plus 2.00 percent or prime up to prime plus 0.50 percent, based on a
financial ratio as defined in the Agreement. Interest on borrowings at
December 29, 1996 ranged from 5.56 percent to 7.11 percent.
F-11
<PAGE> 20
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
The Agreement contains certain restrictive covenants, including
maintenance of a minimum tangible net worth and fixed charge coverage
ratio and limitations on indebtedness, stock acquisitions, encumbrances
and new restaurant expansion. In addition, provided that net income of
the prior year exceeds $2,000,000, dividends can be declared but cannot
exceed 15 percent of the prior year's net income.
(7) SHAREHOLDERS' EQUITY
The Company has authorized 300,000 shares of Class A Junior
participating preferred shares, without par value and 4,700,000 Class B
preferred shares, without par value, none of which have been issued.
Holders of Class A Junior participating preferred shares are entitled
to quarterly dividends equal to the greater of $.05 or 100 times the
aggregate per share amount of all cash and noncash dividends and
holders of Class B are entitled to dividends before distribution to
holders of common shares. Each Class A Junior participating preferred
share entitles the holder to 100 votes on all matters submitted to vote
by the shareholders. Holders of Class B preferred shares are entitled
to one vote for each share on matters requiring approval. The
liquidating value for Class A Junior participating preferred shares is
$.10 per share, plus all accrued and unpaid dividends.
In January 1990, the Board of Directors approved a shareholder rights
plan, as amended, which provides that, in the event that a third party
purchases 20 percent or more of total outstanding stock of the Company,
a dividend distribution of one and one-half rights for each outstanding
common share will be made. These rights expire ten years from date of
issuance, if not earlier redeemed by the Company, and entitle the
holder to purchase, under certain conditions, preferred shares or
common shares of the Company. As of December 29, 1996, approximately
15,052,500 rights were outstanding.
(8) INCOME TAXES
The components of the provision for income taxes are as follows:
<TABLE>
<CAPTION>
December 29, December 31, January 1,
1996 1995 1995
---- ---- ----
(in thousands)
<S> <C> <C> <C>
Current taxes:
Federal $ 2,975 2,412 1,037
State and local 744 481 402
------- ------ ------
3,719 2,893 1,439
Deferred taxes 70 (162) (159)
------- ------ ------
Provision before extraordinary item 3,789 2,731 1,280
Provision on extraordinary item - - 249
------- ------ ------
Provision for income taxes $ 3,789 2,731 1,529
======= ====== ======
</TABLE>
F-12
<PAGE> 21
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
The provision (benefit) for deferred income taxes consists of the
following:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Accelerated depreciation $ 14 (33)
Preoperational costs 121 (114)
Accrued health (14) (27)
Accrued vacation (18) 16
Provision for asset disposal (12) -
Other accrued expenses (27) -
Other 6 (4)
----- ----
Total $ 70 (162)
===== ====
</TABLE>
A reconciliation of the differences between income taxes calculated at
the federal statutory tax rate and the provision for income taxes
before extraordinary item is as follows:
<TABLE>
<CAPTION>
December 29, December 31, January 1,
1996 1995 1995
---- ---- ----
<S> <C> <C> <C>
Income tax at statutory rates before
extraordinary item 34.0% 34.0% 34.0%
State and local income taxes, net of
federal tax benefit 4.7% 4.4% 7.0%
Reserve for tax examination - 2.9% -
FICA tip tax credit (4.6)% (5.2)% (6.6)%
Other nondeductible items 1.9% 2.0% (.4)%
---- ---- ----
36.0% 38.1% 34.0%
==== ==== ====
</TABLE>
The tax effects of temporary differences that give rise to significant
portions of deferred tax assets and deferred tax liabilities are as
follows:
<TABLE>
<CAPTION>
December 29, December 31,
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Accelerated depreciation $ 738 724
Preoperational costs 289 168
Accrued health (114) (100)
Accrued vacation (126) (108)
Provision for asset disposal (96) (84)
Other accrued expenses (104) (77)
Other (5) (11)
----- ----
$ 582 512
===== ====
</TABLE>
F-13
<PAGE> 22
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
The Internal Revenue Service (IRS) has completed its examination of the
Company's income tax returns for the years 1990 through 1993. The
Company has received statutory notices of deficiencies for the 1990 and
1991 years, and has filed a petition in the United States Tax Court
contesting these deficiencies. Statutory notices of deficiencies for
the 1992 and 1993 years are forthcoming. Once received, the Company
intends to file a petition in the United States Tax Court contesting
the deficiencies for these two years also. The deficiencies claimed by
the IRS for the 1990-1993 years approximate $900,000, exclusive of
interest and penalties. The Company believes that the accruals it has
provided in connection with this matter are adequate, and that the
resolution of the case in the United States Tax Court will not have a
material adverse effect on the Company's financial condition or results
of operations.
(9) EMPLOYEE STOCK OWNERSHIP PLAN
In 1989, the Company established an employee stock ownership plan (the
"ESOP" or the "Plan"). All employees who have reached the age of 21
years are participants in the Plan. Participants vest in the Plan based
upon a graduated schedule providing 20 percent after three years of
service and each year thereafter, with full vesting after seven years.
The amount and frequency of contributions to the Plan are at the
discretion of the Company. There were no contributions made to the ESOP
during fiscal 1996. Dividends on shares held by the ESOP are used to
reduce the Company's receivable from the ESOP prior to allocation to
ESOP participant accounts. Shares forfeited due to participant
withdrawals from the ESOP during fiscal 1996 will be reallocated to
remaining participants as of the end of the plan year, as was done for
shares forfeited due to participant withdrawals from the ESOP during
fiscal 1995.
As of December 29, 1996 and December 31, 1995, the ESOP owns 272,000
and 335,000, respectively, of the Company's common shares, all of which
are allocated to eligible participants. In 1996, the Company expressed
an intention to terminate the Plan, subject to Plan provisions.
(10) STOCK OPTION PLANS
The Company has stock option plans adopted in 1988 ("1988 Plan") and
1992 ("1992 Plan"), as amended. Under these plans, employees and
nonmanagement directors are granted stock options as determined by a
committee appointed by the Board of Directors at an exercise price no
less than fair market value at the date of grant. Each option permits
the holder to purchase one share of common stock of the Company at the
stated exercise price up to ten years from the date of grant. Options
vest at a rate of 25 percent per year or, if there is substantial
change in control of the Company, the options become fully vested and
exercisable. The Company has reserved 682,000 and 718,000 common shares
for issuance to employees and 73,332 and 200,000 for issuance to
nonmanagement directors under the 1988 Plan and 1992 Plan,
respectively. No further options can be granted under the 1988 Plan for
employees and nonmanagement directors and under the 1992 Plan for
employees. The granting of options under the 1992 Plan for directors
expires April 13, 2002.
In April 1996, the Board of Directors and shareholders approved the
1996 officer option plan (the "1996 Plan") which provides for the grant
of nonqualified options to officers and employee-directors of the
Company. The number of shares is limited to fifteen percent of the
issued and outstanding shares of common stock, less shares subject to
options issued to officers and employee-directors. The recipients of
the options granted under the 1996 Plan, the number of shares to be
covered by each option, and the exercise price, vesting terms, if any,
duration and other terms of each option shall be determined by the
committee of the Company's Board of Directors. Each option permits the
holder to purchase one share of common stock of the Company at the
stated exercise price up to ten years from the date of grant. The
exercise price shall be determined by the committee at the time of
grant, but in no event shall the exercise price be less than the fair
market value of a share on the date of grant. These options become
vested over
F-14
<PAGE> 23
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
various periods not to exceed four years from the date of grant or, if
there is substantial change in control of the Company, the options
become fully vested and exercised. The maximum number of shares granted
during any fiscal year by the Company shall be 500,000 to any one
officer. No options have been granted under the 1996 Plan through
December 29, 1996. The Plan expires April 22, 2006.
Changes in the number of shares under the stock option plans are
summarized as follows:
<TABLE>
<CAPTION>
Options Price
----------- ----------------------------
<S> <C> <C>
Balance at January 2, 1994 $ 762,000 4.03 - 21.75
Granted 772,000 6.63 - 12.88
Canceled (634,000) 4.03 - 21.75
Exercised (6,000) 4.03 - 4.41
----------- ----------------------------
Balance at January 1, 1995 894,000 4.03 - 21.75
Granted 65,000 6.75 - 11.00
Canceled (17,000) 6.75 - 11.19
Exercised (11,000) 4.03 - 7.63
----------- ----------------------------
Balance at December 31, 1995 931,000 4.03 - 21.75
Granted 373,000 11.25 - 13.87
Canceled (23,000) 6.75 - 11.62
Exercised (10,000) 4.04 - 11.19
----------- ----------------------------
Balance at December 29, 1996 $ 1,271,000 4.04 - 21.75
========= ============================
</TABLE>
During fiscal 1994, the Committee changed the exercise price of certain
options through the authorization of the surrender and cancellation of
541,000 options and the reissuance of 398,000 options under the 1988
and 1992 Plans. The remaining 143,000 canceled options were made
available for subsequent reissuance.
The Company applies APB Opinion No. 25 in accounting for its Plan and,
accordingly, no compensation cost has been recognized for its stock
options in the financial statements. Had the Company determined
compensation cost based on the fair value at the grant date for its
stock options under SFAS No. 123, the Company's net income would have
been reduced to the pro forma amounts indicated below:
<TABLE>
<CAPTION>
1996 1995
---- ----
(in thousands)
<S> <C> <C>
Net income As reported $ 6,732 4,432
Pro forma $ 6,413 4,397
Earnings per share As reported $ .72 .60
Pro forma $ .68 .60
</TABLE>
Pro forma net income reflects only options granted in 1996 and 1995.
Therefore, the full impact of calculating compensation cost for stock
options under SFAS No. 123 is not reflected in the pro forma net income
amounts presented above because compensation cost is reflected over the
options' vesting period of four years and compensation cost for options
granted prior to January 1, 1995 is not considered.
The per share weighted-average fair value of stock options granted
during 1996 and 1995 was $5.56 and $3.89 on the date of grant using the
Black Scholes option-pricing model with the following weighted-average
assumptions: 1996-expected dividend yield .49 percent, risk-free
interest rate of 5.6 percent, an expected life of 7 years, and
volatility of 37 percent; 1995-expected dividend yield .65 percent,
risk-free interest rate of 6.69 percent, an expected life of 7 years
and volatility of 37 percent.
F-15
<PAGE> 24
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
Stock option activity during the periods indicated is as follows:
<TABLE>
<CAPTION>
Number of Weighted-average
Shares Exercise Price
------ --------------
<S> <C> <C>
Balance at January 1, 1995 894,000 $ 7.63
Granted 65,000 8.02
Cancelled (17,000) 8.96
Exercised (11,000) 4.64
--------- ------
Balance at December 31, 1995 931,000 7.68
Granted 373,000 11.77
Cancelled (23,000) 10.82
Exercised (10,000) 5.62
--------- ------
Balance at December 29, 1996 1,271,000 $ 8.77
========= ======
</TABLE>
At December 29, 1996, the range of exercise prices and weighted-average
remaining contractual life of outstanding options was $4.04-$21.75 and
7.5 years, respectively.
At December 29, 1996 and December 31, 1995, the number of options
exercisable was 583,000 and 417,000, respectively, and the
weighted-average exercise price of those options was $7.91 and $7.86,
respectively.
(11) COMMITMENT AND CONTINGENCIES
(A) LEASES
The Company leases buildings for certain of its restaurants
under long-term operating leases which expire over the next
twenty-five years. In addition to the minimum rental for these
leases, the Company also pays, in certain instances, additional
rent based on a percentage of sales, and its pro rata share of
the lessor's direct operating expenditures. Several of the
leases provide for option renewal periods and scheduled rent
increases. Rental expense totaled $1,549,000, $1,378,000 and
$1,637,000, including percentage rent of $231,000, $262,000 and
$247,000 for the fiscal years ended December 29, 1996, December
31, 1995 and January 1, 1995, respectively.
Minimum rental commitments for noncancelable leases as of
December 29, 1996 are as follows:
<TABLE>
<CAPTION>
Fiscal year ending Amount
------------------ ------
(in thousands)
<S> <C> <C>
1997 $ 1,908
1998 1,938
1999 1,952
2000 1,949
2001 1,969
Thereafter 17,800
------
$ 27,516
======
</TABLE>
F-16
<PAGE> 25
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
(B) LEGAL MATTERS
The Company is a party to various claims and legal actions
arising in the ordinary course of business. In the opinion of
management, the ultimate disposition of these matters will not
have a material adverse effect on the Company's financial
position, results of operations or liquidity.
(C) EMPLOYMENT AGREEMENTS
The Company and five of its officers have entered into
employment agreements which become effective upon a change in
control of the Company not approved by the Board of Directors,
as defined in the agreement and subject to certain criteria. The
agreement entitles the officers to a base salary, bonus and
benefits at not less than the rate the officer was receiving
prior to the change in control, limits discharge except for
cause, and provides for severance payment equal to the maximum
amount under IRS regulations.
(12) SUPPLEMENTAL CASH FLOW INFORMATION
During 1995, the Company received $115,000 of its common stock from the
ESOP for partial repayment of the advances to the ESOP. The common
stock received was recorded as treasury stock.
During fiscal 1993, the Company acquired treasury stock of $1,347,000
which was included in accounts payable at January 2, 1994 and was paid
in fiscal 1994. Also, as described in note 6, $643,000 related to the
repurchase of Debentures was included in accounts payable at January 1,
1995 and was paid during 1995.
Cash paid for interest for fiscal 1996 and 1995 was $2,004,000 and
$1,489,000, respectively. Cash paid for taxes for fiscal 1996 and 1995
was $3,511,000 and $2,581,000, respectively.
(13) RELATED PARTIES
Effective March 9, 1994, as amended January 31, 1997, the Board of
Directors (the "Board") authorized the Company to execute a guaranty
agreement whereby the Company guaranteed for one year the personal
indebtedness of the chairman together with accrued but unpaid interest.
This indebtedness is secured by a pledge of 570,000 common shares owned
by the chairman and a cross-collateralization of a mortgage on the
chairman's personal residence. Further, the chairman has agreed to
apply his share of the net proceeds of the sale of his residence, in
excess of the mortgage thereon, to reduce the principal and interest
outstanding on the indebtedness, at the Board's request. The guaranty
of principal plus any accrued but unpaid interest 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. On March 4,
1997, the Chairman exercised options to purchase 100,000 common shares,
sold such shares in a block transaction through a broker at $11.50 per
share, the then current trading price on the New York Stock Exchange,
and the Company purchased 100,000 shares in a block transaction through
the same broker at the same time. The net proceeds from the exercise of
the stock options reduced the principal of the guaranteed loan. At
March 13, 1997, the amount of the guaranteed loan including interest
approximated $5.5 million. A fee of .25 percent per annum is charged on
the amount of the guaranty. On June 27, 1995, the Board requested the
chairman to refinance his personal indebtedness with another bank. On
December 27, 1995, the Board authorized the Company to reimburse the
chairman $42,000 for refinancing costs in executing the request. The
Company does not consider it necessary to provide for a potential loss
related to the guaranty in the financial statements at this time.
F-17
<PAGE> 26
COOKER RESTAURANT CORPORATION
NOTES TO FINANCIAL STATEMENTS
(14) SUBSEQUENT EVENT
Effective January 1, 1997 the Company established a 401(k) retirement
savings plan for the benefit of substantially all employees who have
attained the age 21 and worked 1,000 hours. Employees may contribute
between 1 to 15 percent of eligible compensation. The Company's
discretionary match is based on the Company's performance. The
Company's contribution will vest 20 percent per year beginning after
the third year.
(15) QUARTERLY FINANCIAL DATA (UNAUDITED)
Quarterly financial data for fiscal year 1996 and 1995 are summarized
as follows:
<TABLE>
<CAPTION> First Second Third Fourth
quarter quarter quarter quarter
------- ------- ------ -------
1996 (in thousands, except per share data)
----
<S> <C> <C> <C> <C>
Sales $ 25,486 26,919 29,183 28,685
Restaurant operating income (a) 4,186 4,375 4,721 4,501
Income before income taxes 2,125 2,575 2,934 2,887
Net income 1,360 1,648 1,878 1,846
Earnings per share $ .18 .18 .18 .18
1995
Sales $ 22,899 22,694 22,758 23,327
Restaurant operating income (a) 3,556 3,547 3,615 3,743
Income before income taxes 1,806 1,723 1,733 1,901
Net income 1,005 1,102 1,109 1,216
Earnings per share $ .14 .15 .15 .16
<FN>
(a) Sales less food and beverages, labor, restaurant operating
expenses and depreciation and amortization.
</TABLE>
F-18
<PAGE> 27
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
COOKER RESTAURANT CORPORATION
------------------
FORM 10-K/A ANNUAL REPORT
AMENDMENT NUMBER 2
FOR THE FISCAL YEAR ENDED
DECEMBER 29, 1996
------------------
EXHIBITS
------------------
================================================================================
<PAGE> 28
Exhibit 3.1.
Amended and Restated Articles of Incorporation of the Registrant (incorporated
by reference).
13 pages in the original.
Exhibit 3.2.
Amended and Restated Code of Regulations of the Registrant (incorporated by
reference).
12 pages in the original.
Exhibit 4.1.
See Articles FOURTH, FIFTH and SIXTH of the Amended and Restated Articles of
Incorporation of the Registrant (see 3.1 above).
13 pages in the original.
Exhibit 4.2.
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see 3.2 above).
12 pages in the original.
Exhibit 4.3.
Rights Agreement dated as of February 1, 1990 between the Registrant and
National City Bank (incorporated by reference).
65 pages in the original.
Exhibit 4.4.
Amendment to Rights Agreement dated as of November 1, 1992 between the
Registrant and National City Bank (incorporated by reference).
1 page in the original.
- --------------------------------------------------------------------------------
The Registrant will furnish a copy of any exhibit to a beneficial owner of its
securities or to any person from whom a proxy was solicited in connection with
the Registrant's most recent Annual Meeting of Shareholders upon the payment of
a fee of fifty cents ($.50) per page.
<PAGE> 29
Exhibit 4.5.
Letter dated October 29, 1992 from the Registrant to First Union National Bank
of North Carolina (incorporated by reference).
1 page in the original.
Exhibit 4.6.
Letter dated October 29, 1992 from National City Bank to the Registrant
(incorporated by reference).
1 page in the original.
Exhibit 4.7.
See Section 7.4 of the Amended and Restated Loan Agreement dated December 22,
1995 between Registrant and First Union National Bank of Tennessee. (see 10.4
below).
31 pages in the original.
Exhibit 4.8.
Indenture dated as of October 28, 1992 between Registrant and First Union
National Bank of North Carolina, as Trustee (incorporated by reference).
61 pages in the original.
Exhibit 10.1.
Purchase and Sale Agreement dated October 20, 1995 between GMRI, Inc. and
Registrant (incorporated by reference).
17 pages in the original.
Exhibit 10.2.
First Amendment to Purchase and Sale Agreement dated October [ ], 1995 between
GMRI, Inc. and Registrant (incorporated by reference).
2 pages in the original.
- --------------------------------------------------------------------------------
The Registrant will furnish a copy of any exhibit to a beneficial owner of its
securities or to any person from whom a proxy was solicited in connection with
the Registrant's most recent Annual Meeting of Shareholders upon the payment of
a fee of fifty cents ($.50) per page.
<PAGE> 30
Exhibit 10.3.
Joinder of Escrow Agreement dated October 25, 1995 among Lawyers Title Insurance
Corporation, GMRI, Inc. and Registrant (incorporated by reference).
2 pages in the original.
Exhibit 10.4.
Amended and Restated Loan Agreement dated December 22, 1995 between Registrant
and First Union National Bank of Tennessee (incorporated by reference).
31 pages in the original.
Exhibit 10.5.
Underwriting Agreement dated May 7, 1996 with Montgomery Securities and
Equitable Securities Corporation (incorporated by reference).
28 pages in the original.
Exhibit 10.6.
Form of Contingent Employment Agreement and schedule of executed Agreements
(incorporated by reference).*
10 pages in the original.
Exhibit 10.7.
The Registrant's 1988 Employee Stock Option Plan and 1992 Employee Stock Option
Plan, Amended and Restated April 22, 1996, (incorporated by reference).
11 pages in the original.
Exhibit 10.8.
The Registrant's 1988 Directors Stock Option Plan, as amended and restated
(previously filed).
6 pages in the original.
- --------------------------------------------------------------------------------
The Registrant will furnish a copy of any exhibit to a beneficial owner of its
securities or to any person from whom a proxy was solicited in connection with
the Registrant's most recent Annual Meeting of Shareholders upon the payment of
a fee of fifty cents ($.50) per page.
<PAGE> 31
Exhibit 10.9.
The Registrant's 1992 Directors Stock Option Plan, as amended and restated
(previously filed).*
6 pages in the original.
Exhibit 10.10.
The Registrant's 1996 Officers' Stock Option Plan (incorporated by reference).*
10 pages in the original.
Exhibit 10.11.
Reaffirmation and Amendment to Guaranty and Suretyship Agreement between
Registrant and NationsBank of Tennessee, N.A. dated July 24, 1995 (incorporated
by reference).
2 pages in the original.
Exhibit 10.12.
Amended and Restated Guaranty between Registrant and Chase Manhattan Bank dated
January 31, 1997 (previously filed).
7 pages in the original.
Exhibit 10.13.
Letter dated February 3, 1997 from G. Arthur Seelbinder to the Registrant
(previously filed).
1 page in the original.
Exhibit 16.1.
Letter dated August 14, 1996 from Price Waterhouse LLP to the Securities and
Exchange Commission (incorporated by reference).
1 page in the original.
- --------------------------------------------------------------------------------
The Registrant will furnish a copy of any exhibit to a beneficial owner of its
securities or to any person from whom a proxy was solicited in connection with
the Registrant's most recent Annual Meeting of Shareholders upon the payment of
a fee of fifty cents ($.50) per page.
<PAGE> 32
Exhibit 23.1.
Consent of KPMG Peat Marwick LLP.
Page 33 in manually signed original.
1 page in the original.
Exhibit 24.1.
Powers of Attorney (previously filed).
10 pages in the original.
Exhibit 24.2.
Certified resolution of the Registrant's Board of Directors authorizing officers
and directors signing on behalf of the Registrant to sign pursuant to a power of
attorney (previously filed).
1 page in the original.
Exhibit 27.1.
Financial Data Schedule (submitted electronically for SEC information only;
previously filed).
1 page in the original.
- --------------------------------------------------------------------------------
The Registrant will furnish a copy of any exhibit to a beneficial owner of its
securities or to any person from whom a proxy was solicited in connection with
the Registrant's most recent Annual Meeting of Shareholders upon the payment of
fifty cents ($.50) per page.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Cooker Restaurant Corporation
We consent to the incorporation by reference in the registration statements on
Form S-8 (Nos. 33-45467, 33-46475, 33-46965, 33-48396 and 33-48397) of Cooker
Restaurant Corporation of our report dated May 9, 1997, relating to the balance
sheets of Cooker Restaurant Corporation as of December 29, 1996 and December 31,
1995, and the related statements of income, changes in shareholders' equity and
cash flows for each of the years in the three year period ended December 29,
1996, which report appears in the December 29, 1996 annual report on Form
10-K/A Amendment Number 2 of Cooker Restaurant Corporation.
/s/ KPMG Peat Marwick LLP
Fort Lauderdale, Florida
March 2, 1998
