SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended Commission File Number 33-39263-NY
September 30, 1995
CABARET ROYALE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 22-2993070
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10723 COMPOSITE DRIVE
DALLAS, TEXAS 75220
(214) 350-2161
(Principal Executive Offices)
-----------------------------
Indicate by check mark 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.
Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
COMMON STOCK, PAR VALUE $0.001 7,348,574 SHARES
- ------------------------------ ----------------
Class Outstanding at September 30, 1995
All currencies stated herein are in U.S. Dollars
<PAGE>
CABARET ROYALE CORPORATION
FORM 10-QSB/A
INDEX
Page
----
PART I - FINANCIAL INFORMATION
- ------------------------------
ITEM 1. FINANCIAL STATEMENTS
Consolidated Condensed Balance Sheets
September, 1995 and December 31, 1994 3
Consolidated Condensed Statements of operations:
Three Months Ended September 30, 1995 and 1994 5
Consolidated Condensed Statements of operations:
Nine Months Ended September 30, 1995 and 1994 6
Consolidated Condensed Statements of Cash Flows
Nine Months Ended September 30, 1995 and 1994 7
Notes to Consolidated Condensed Financial Statements 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 12
PART II - OTHER INFORMATION AND SIGNATURES
- ------------------------------------------
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
SIGNATURES
-2-
<PAGE>
CABARET ROYALE CORPORATION
FORM 10-QSB/A
PART I - FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
Consolidated Condensed Balance Sheets
September 30, 1995 and December 31, 1994
ASSETS
------
September 30, December 31,
1995 1994
(Unaudited)
Current assets:
Cash and cash equivalents $ (17,523) $ --
Federal Income Tax Refund -- 3,409
Accounts receivable:
Affiliates 176,324 131,809
Employees 2,656 --
============ -----------
Total current assets 161,457 135,218
----------- -----------
Property and equipment:
Land and improvements 770,948 770,948
Building and improvements 3,738,394 3,738,394
Furniture and equipment 1,373,766 1,381,005
----------- -----------
5,883,108 5,890,347
Less accumulated depreciation (1,852,839) (1,669,212)
----------- -----------
Net Property and equipment 4,030,269 4,221,135
Other assets 3,198 18,644
----------- -----------
Total other assets $ 4,194,924 $ 4,374,997
----------- -----------
-3-
<PAGE>
CABARET ROYALE CORPORATION
Consolidated Condensed Balance Sheet (Cont.)
September 30, 1995 and December 31, 1994
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
September 30, December 31,
1995 1994
(Unaudited)
Current liabilities:
Bank overdraft -- $ 69,412
Accounts payable $ 87,099 121,684
Accrued expenses:
Interest payable 371,014 214,535
Other accrued expenses 296,253 87,298
Management fees payable 3,700 --
Security Deposits 2,000 --
Bridge financing notes payable 2,835,010 2,835,000
Other notes payable 35,518 79,634
Current portion of long-term debt
And Capital Lease Obligations 63,541 67,490
Federal Income taxes payable (3,409) --
----------- -----------
Total current liabilities $ 3,690,726 $ 3,475,053
----------- -----------
Net liabilities of CAT Entertainment,
A discontinued operation -- 3,793,409
Notes payable and capital lease obligations,
Net of current portion 1,524,656 1,434,849
----------- -----------
Stockholders' equity:
Common stock; $.001 par; 60,000,000
shares authorized, 7,298,854 outstanding 7,299 7,299
Additional paid-in capital 5,308,572 5,308,572
Retained earnings (deficit) (9,644,185) (9,644,185)
Year-to-Date Net Income 3,307,856 --
----------- -----------
Total stockholders' equity(deficit) (1,020,458) (4,328,314)
----------- -----------
Total Liabilities and Capital $ 4,194,924 $ 4,374,997
=========== ===========
See accompanying notes to consolidated financial statements.
-4-
<PAGE>
<TABLE>
<CAPTION>
CABARET ROYALE CORPORATION
Consolidated Statements of Income
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
Revenues:
<S> <C> <C> <C> <C>
Operating sales -- $ 462,223 -- 1,435,191
Rental income $ 110,129 231,701 343,998 722,314
Franchise fees 34,770 110,113 99,525 113,905
----------- ----------- ----------- -----------
$ 144,899 $ 195,037 $ 443,523 $ 2,271,410
----------- ----------- ----------- -----------
Operating costs and expenses:
Cost of sales -- 99,202 -- 341,704
Operating expenses 153,495 530,924 455,263 1,710,752
General and administrative
expenses -- 383,523 -- 1,214,630
Depreciation and
amortization 67,774 702,174 203,324 1,686,19
----------- ----------- ----------- -----------
221,269 1,715,823 658,587 4,953,285
----------- ----------- ----------- -----------
Operating income (loss) (76,370) (911,786) (215,065) (2,681,875)
Other income (expenses):
Interest/misc. income -- 22,015 1,727 23,190
Gain on sale of Fixed Assets -- -- 11,151 --
Interest/debt conversion
expenses (110,384) (139,432) (261,295) (457,563)
----------- ----------- ----------- -----------
Net income (loss) before
provision for income taxes (186,754) (1,029,203) (489,238) (3,116,248)
Discontinued Operations
Gain on Disposal of CAT (3,146) -- 3,797,094 --
Provision (benefit) for
income taxes (Note 6) -- -- -- (10,985)
----------- ----------- ----------- -----------
Net income (loss) $ (189,900) $(1,029,203) $ 3,307,856 $(3,105,263)
Pro forma income (loss)
per share (Note 3) $ (0.03) $ (0.15) $ (0.04) $ (0.44)
=========== =========== =========== ===========
Pro forma weighted average
shares outstanding (Note 3) 7,348,574 6,980,529 7,348,574 6,980,529
=========== =========== =========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
-5-
<PAGE>
<TABLE>
<CAPTION>
CABARET ROYALE CORPORATION
Consolidated Statement of Changes in Stockholders' Equity
September 30, 1995
Common stock
------------
Number Additional Total
of paid-in Retained stockholders'
shares Amount capital earnings (deficit) equity
------ ------ ------- ------------------ ------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1994 7,348,574 7,299 5,308,572 (9,644,185) $(4,328,314)
Net income (loss) -- -- -- 3,307,856 3,307,856
---------- ---------- ---------- ---------- ----------
Balance at September 30,1995 7,348,574 7,299 5,308,572 (6,336,329) (1,020,458)
</TABLE>
See accompanying notes to consolidated financial statements.
-6-
<PAGE>
<TABLE>
<CAPTION>
CABARET ROYALE CORPORATION
Consolidated Statements of Cash Flows
Nine months ended
1995 1994
------------ ----------
Cash flows from operating activities:
<S> <C> <C>
Net Income(loss) $ (489,238) $(3,105,263)
Noncash revenues, expenses, gains, and
losses included in net income(loss):
Loan origination expense -- 115,000
Debt conversion expense -- 75,000
Depreciation and amortization 203,324 1,686,199
Gain on sale of fixed assets (11,151) --
Changes in assets and liabilities:
Accounts receivable (28,635) (70,416)
Inventories -- (41,995)
Other assets -- (9,123)
Prepaid expenses 1,811 --
Accounts payable (34,585) 571,534
Accrued expenses 214,655 277,556
Interest payable 156,478 --
Other notes payable (44,106) --
Federal income taxes payable -- (10,985)
-----------
Net cash provided (used in) by operating activities (31,449) (512,493)
Gain from discontinued operations 3,797,094 --
Net adjustments to reconcile gain from
Discontinued operations to cash received (3,811,945) --
From discontinuedoperations:
Net cash used in discontinued operations (14,851) --
Net cash used in investing activities:
Purchase of leasehold improvements -- (2,391,100)
Payment of rent arrearages -- (141,000)
-----------
Net cash used in investing activities -- (2,532,100)
Net cash provided by (used in) financing activities:
Payment of mortgages and notes payable -- (91,599)
Proceeds from bridge loan -- 2,835,010
Proceeds from new borrowings 150,000 --
Loans from stockholders -- 266,000
-----------
Payment on long term debt 51,812 --
Net cash provided by (used in) financing activities 98,188 3,009,411
Net increase (decrease) in cash and cash equivalents 51,888 (35,182)
Cash and cash equivalents at beginning of period (69,412) 39,319
----------- -----------
Cash and cash equivalents at end of period $ (17,523) $ 4,137
=========== ===========
Supplemental information:
Interest paid $ 118,039 $ 78,645
=========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
-7-
<PAGE>
CABARET ROYALE CORPORATION
Notes to Consolidated Financial Statements
1. CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements included herein have been prepared by
the Company and are unaudited. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. Management
believes the disclosures are adequate to prevent the financial information from
being misleading and believes all adjustments deemed necessary for a fair
presentation of the consolidated financial position and operating results for
the interim period have been reflected. Consolidated operating results through
September 30, 1995, are not necessarily indicative of operating results for the
year ending December 31, 1995.
2. ORGANIZATION AND BUSINESS OPERATIONS
On September 30, 1993, Walhill Partners, Ltd. (Walhill) was acquired by
Exceptional Enterprises Inc. (Exceptional). After the acquisition, Exceptional
changed its name to Cabaret Royale Corporation (the Company). Walhill was
originally formed for the purpose of owning a restaurant, bar and cabaret club
in Dallas, Texas. Exceptional had been an inactive company whose stock was
registered under the Securities Exchange Act of 1933.
The acquisition of Walhill by Exceptional was accounted for as a reverse
acquisition. Under the reverse acquisition, Walhill was effectively the acquiror
of Exceptional. Therefore, the accompanying consolidated financial statements
are those of Walhill for all periods presented, adjusted to reflect the reverse
acquisition. As part of that adjustment, partners' net capital in Walhill was
allocated between common stock, additional paid-in-capital and retained
earnings.
During 1993 and 1994, the Company's operations consisted of leasing the
Dallas facility to an affiliated company, operating under the name of Cabaret
Royale. On February 24, 1994, the Company acquired the outstanding common stock
of an entity which owned leasehold improvements in a leased facility in New York
City. The acquisition was made through a wholly owned subsidiary of the Company.
On March 14, 1994, the facility opened and began operating as a restaurant, bar
and cabaret club. During the first quarter of 1994, the Company issued an
aggregate of $2,655,000 in 8% convertible subordinated notes. An additional
$180,010 in 8% convertible subordinated notes were issued during the second and
third quarters of 1994. Proceeds from the notes were primarily used for
improvements in the New York facility.
On December 23, 1995, the Company sold its major asset, the
restaurant/bar/nightclub facility located at 10723 Composite Drive, Dallas,
Texas, to AAI Investments, Inc., a Florida corporation, and vacated the
referenced premises on December 30, 1995. The Company's other assets, including
a franchise operation in Mexico City, Mexico were unaffected.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include
the accounts of Cabaret Royale Corporation and its wholly owned subsidiary.
Intercompany accounts and transactions have been eliminated in consolidation.
-8-
<PAGE>
CABARET ROYALE CORPORATION
Notes to Consolidated Financial Statements
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
PROPERTY, EQUIPMENT, DEPRECIATION AND AMORTIZATION - Property and equipment
are stated at cost. Depreciation and amortization are computed over the
estimated useful lives of the assets, primarily on a straight-line basis for
financial statement purposes, as follows:
Years
-----
Buildings and improvement 31.5
Furniture and equipment 5-7
OTHER ASSETS - Other assets are stated at cost and consist primarily of
deferred costs, loan origination fees, deposits and goodwill. Deferred costs
include costs related to site selections for future facilities. Costs related to
abandoned future facilities and general facility selection costs which cannot be
identified with specific locations are charged to operations.
Loan origination fees of $115,000 related to the issuance of convertible
subordinated notes, were amortized using the interest method between April 1,
1994 and August 31, 1994, the maturity date of the notes. Interest expense
charged to operations for the nine month period ended September 30, 1994 was
$115,000.
Goodwill represents the aggregate excess of the cost of companies acquired
over the fair value of their net assets at dates of acquisition and is being
amortized on the straight line method over two years from the date of
acquisition. Amortization expense charged to operations for the nine month
period ended September 30, 1994 and 1993 was $578,382 and -0-, respectively.
INCOME TAXES - Concurrent with the acquisition by Exceptional, the Company
adopted Statement of Financial Accounting Standards No. 109 (SFAS 109),
"Accounting for Income Taxes." SFAS 109 requires an asset and liability approach
to financial accounting for income taxes. In the event differences between the
financial reporting basis and the tax basis of the Company's assets and
liabilities result in deferred tax assets, SFAS 109 requires an evaluation of
the probability of being able to realize the future benefits indicated by such
assets. A valuation allowance is provided for a portion or all of the deferred
tax assets when there is an uncertainty regarding the Company's ability to
recognize the benefits of the assets in future years.
INCOME (LOSS) PER SHARE - Income (loss) per share are computed by dividing
the net income (loss) by the pro forma weighted average number of common shares
outstanding, plus common stock equivalents. Common stock equivalents represent
warrants with an exercise price below fair market value for any of the years
presented (see Note 7). The income (loss) per share calculations were made as
though the Exceptional acquisition took place on January 1, 1993.
-9-
<PAGE>
CABARET ROYALE CORPORATION
Notes to Consolidated Financial Statements
4. CONVERTIBLE DEBT
During 1994, the Company borrowed an aggregate of $2,835,010 of 8%
convertible subordinated notes. The notes and related accrued interest were
payable on August 31, 1994. These notes are currently in default. Each note is
convertible, at the option of the holder, into Class A common stock at the price
then offered by the Company in any private or public offering. In connection
with the issuance of the convertible subordinated notes, the Company issued
2,835,010 warrants to purchase Class A common stock, exercisable at $2.50 per
share. The warrants provide that if the related note is not repaid by May 31,
1994, the number of shares subject to warrants doubles. The warrants further
provide that if the related note is not repaid by July 31, 1994, the exercise
price decreases to $1.25 a share. The warrants expire three years from the date
of issuance. (See Note 7 for total balance of warrants outstanding.)
5. NEW YORK ACQUISITION
On February 24, 1994, the Company acquired the outstanding common stock
of an entity which owned leasehold improvements, furniture, fixtures and
equipment in a leased facility in New York City. As consideration for the
acquisition, the Company issued 2,400,000 shares of Class A common stock,
1,000,000 warrants to purchase Class A common stock at $2.50 a share and
1,000,000 warrants to purchase Class A common stock at $5.00 a share. The
warrants are subject, under certain circumstances, to adjustments corresponding
to those in the convertible note warrants described above. The warrants expire
two years from the date of issuance. (See Note 7 for total balance of warrants
outstanding.) The following sets forth assets acquired and liabilities assumed
in the acquisition:
Assets:
Inventory $ 3,879
Property and equipment 3,493,647
Goodwill 4,933,860
Other assets 308,194
----------
$8,739,580
==========
Liabilities:
Accounts payable $ 724,651
Notes payable 5,014,929
----------
5,739,580
Common stock 3,000,000
---------
$8,739,580
==========
-10-
<PAGE>
CABARET ROYALE CORPORATION
Notes to Consolidated Financial Statements
6. INCOME TAXES
Prior to September 30, 1993 and the acquisition by Exceptional, the Company
was organized as a limited partnership. As a limited partnership, income and
losses were reported in the income tax returns of the individual partners.
Accordingly, no provision was made for income taxes related to partnership
operations.
7. COMMON STOCK WARRANTS
At June 30, 1994, the Company had 10,470,020 common stock warrants
outstanding. Each warrant is currently exercisable for one share of Class A
common stock at prices ranging between $1.00 and $2.50 a share. The warrants
expire between February 1996 and July 1998.
8. RELATED PARTY TRANSACTIONS
Effective April 1, 1994, the lease with an affiliated company was amended
to increase the rent from 16% to 21% of its adjusted gross receipts (minimum
$30,000 per month). This was to compensate the Company for management advisory
services and use of the trademark. This lease was terminated as part of the sale
of the Dallas facility and is no longer in effect.
9. COMMITMENTS AND CONTINGENCIES
An affiliate of the Company, which was the former lessee of the Dallas
facility, is the defendant in a lawsuit filed in Federal district court by the
U.S. Department of Labor. The lawsuit claims certain independent contractors
were employees of such affiliate, rather than independent contractors. The
lawsuit was vigorously defended by such affiliate; however, the defense was
unsuccesful. Further, the Internal Revenue Service (IRS) informed such affiliate
that, if the lawsuit was successful, the IRS will pursue a claim for payroll tax
arrearages. Although the Company is not a party to the above mentioned lawsuit,
the results of the suit could negatively impact the operations of the Dallas
facility and the collectibility of related rental income.
The Company was notified by the State of New York of a $41,000 sales tax
assessment against the New York facility (see Note 5). This assessment relates
to operations by the previous owner and has been settled for $322.
10. NON CASH INVESTING AND FINANCING TRANSACTIONS
On February 24, 1994, the Company made a non-cash acquisition of a company
which held a lease and owned leasehold improvements in a New York City facility.
The Company issued as consideration for the acquisition, 2,400,000 shares of
Class A common stock and 2,000,000 warrants to purchase Class A common stock.
-11-
<PAGE>
On April 1, 1994, the Company made a non-cash conversion of debt and accrued
interest to 51,358 shares of Class A Common Stock.
Item 2. Management's discussion and analysis of financial conditions and results
of operations
INTRODUCTION - During 1994, the primary effort of the Company will be to bring
to full operational status the New York City facility, the newly franchised
Mexico City facility, and the location and evaluation of potential new
facilities for expansion. The acquisition of the New York City facility occurred
on February 24, 1994 and began operations on March 14, 1994. Extensive
advertising was run during the first several weeks of operations, the benefit of
which was seen in the second quarter of 1994 and has continued to be evidenced
during the third quarter of 1994. Since the acquisition was of an existing
corporation, the Company is currently in the process of streamlining the
operations to conform to operating policies and procedures currently in use at
the Dallas facility, resulting in reduced operating costs in the future. The New
York facility was placed in bankruptcy in January 1995 and was administered as a
"no-asset" Chapter 7. The franchised facility in Mexico City opened on May 23,
1994. Sales have been better than budgeted and should continue to be higher than
initially projected by the Company.
RESULTS OF OPERATIONS - The following table sets forth the percentages which the
items in the statements of operations bear to revenues for each period
presented:
<TABLE>
<CAPTION>
Period ended September 30,
1995 1994
---- ----
Revenues:
<S> <C> <C>
Operating sales - 63.2
Rental income 77.6 31.8
Franchise fees 22.4 5.0.
---- ----
100.0% 100.0%
Operating costs and expenses:
Cost of sales - 15.0
Operating expenses 102.6 75.
General and administrative - 53.5
Depreciation and amortization 45.9 74.2
---- ----
Total Operating Expenses (148.5) (218.0)
Operating income (loss) (48.5) (118.0)
Other Income (expense):
Interest income 0.0 1.0
Interest expense (64.7) (20.1)
----
Other income 2.9 --
Other income (expense) (61.8) 19.1
Net Income(loss) from continuing operations 110.3) (98.1)
Income (loss) before provision for income taxes -- (137.1)
Benefit for income taxes -- 0.4
Gain on Disposal of CAT 865.1 --
Net Income(loss) from Discontinued Operations 856.1 --
Net income (loss) 745.8% (1367%)
====== =====
</TABLE>
-12-
<PAGE>
September 30, 1995 compared to September 30, 1994
- -------------------------------------------------
REVENUES - The facility in New York City contributed operating sales of
$1,435,191 through the third quarter of 1994. Rent income from the Dallas
facility for the nine months ended September 30, 1994 increased $114,761, or
18.9%, compared with the same period for the nine months ended September 30,
1993. This increase was due to a slight improvement in economic conditions of
the Dallas market area and a 5% increase in the rent percent charged to the
lessee of the Dallas facility, effective April 1, for management advisory
services and use of the trademark. The 5% franchise fee from the facility in
Mexico City resulted in $113,905 for the first four and one-half months of
operations.
COST OF SALES - Cost of sales were the result of continuing operations of the
New York City facility.
OPERATING EXPENSES - Operating expenses consist of salaries, payroll taxes,
supplies, utilities, advertising and other expenses associated with the opening
and operation of the New York City facility.
GENERAL AND ADMINISTRATIVE EXPENSES - General and administrative expenses
increased $1,192,964, or 550.6%, due primarily to the marked increase in
executive salaries and professional services related to the acquisition of the
new facility in New York, investigating sources of additional equity financing
and reporting requirements as a public company.
BAD DEBT EXPENSE - The bad debt expense was due to the write off of a receivable
from the previous operating company which became insolvent in 1993.
DEPRECIATION AND AMORTIZATION - The increase in depreciation and amortization
expense of $$1,512,008, or 868.0%, was due primarily to the amortization of
goodwill associated with the acquisition of the New York City facility.
INTEREST/MISCELLANEOUS INCOME - Interest/miscellaneous income increased $10,055
or 76.6% due to a refund of a license fee for the New York City facility and
video income for the rental of the Dallas facility for location filming.
INTEREST/DEBT CONVERSION EXPENSES - Interest/debt conversion expenses increased
$314,172, or 219.1% for the nine months, due to the assumption of additional
liabilities associated with the transfer of assets from the previous operating
company of the Dallas facility. In addition, warrants to purchase shares of
Class A Common Stock of the Company valued at $.025 each were issued to an
individual assisting with the raising of funds by the Company through 8%
Convertible Subordinated Notes. The write off of loan origination fees also
contributed to the increase.
PROVISION (BENEFIT) FOR INCOME TAXES - A tax benefit of $10,985 relates to net
operating losses carried back to taxes incurred in the last quarter of 1993.
Prior to the Exceptional acquisition, income or losses of Walhill were reported
in the income tax returns of the individual partners. Accordingly, no provision
was made for income taxes relating to those operations.
-13-
<PAGE>
NET INCOME (LOSS) - The September 30, 1994 net loss of $2,230,964, a decrease in
net income of $1,993,206, was due primarily to the acquisition and start up of
the New York City facility.
LIQUIDITY AND CAPITAL RESOURCES - The Company has operated with a working
capital deficiency during the first three quarters of the year and received
short term loans from shareholders to bridge the cash flow deficit until
additional equity financing can be obtained.
The Company will continue to move forward with plans to open other facilities in
other cities and will be seeking to raise capital to finance any such expansion.
The acquisition of the New York City facility was accomplished through issuance
of shares of Class A common stock and warrants to purchase Class A common stock,
in exchange for the stock of the entity owning the New York City facility. The
Company loaned $2,000,000 which was used by that entity for renovations to the
New York City facility. Funds for the renovation loan came from borrowings of
$2,685,000 by 8% convertible subordinated notes of the Company. Those notes are
currently in default. Any additional equity financing raised will be used to
retire these notes. The Company borrowed an additional $150,010 of the 8%
convertible subordinated notes to complete renovations to the New York facility.
A franchised Mexico City facility had a soft opening on May 17, 1994 and opened
for regular business on May 23, 1994. The first year franchise fees will be 5%
of gross revenues and subsequent years will be a variable percentage, not less
than 5% of gross revenues.
-14-
<PAGE>
Part II - Other Information
Exhibits and Reports on Form 8-K
- --------------------------------
(a) Exhibits - None
(b) Form 8-K's filed: - none
-15-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereupon duly authorized.
CABARET ROYALE CORPORATION
September 30, 1995
/s/ Salah Izzedin
-----------------
Salah Izzedin
President
-17-
