<PAGE> 1
As filed with the Securities and Exchange Commission on August 21, 1998
Registration No. 333-55825
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
CHECKERS DRIVE-IN RESTAURANTS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 58-1654960
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
14255 49TH STREET NORTH, BUILDING 1
CLEARWATER, FLORIDA 33762
(727) 519-2000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
-------------------
JAMES J. GILLESPIE
14255 49TH STREET NORTH, BUILDING 1
CLEARWATER, FLORIDA 33762
(727)519-2000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
-------------------
COPIES TO:
JANET S. MCCLOUD, ESQ.
CHRISTENSEN, MILLER, FINK, JACOBS, GLASER, WEIL & SHAPIRO, LLP
2121 AVENUE OF THE STARS, 18TH FLOOR
LOS ANGELES, CALIFORNIA 90067
(310) 553-3000
-------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after the effective date of this Registration Statement.
-------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest investment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
Proposed Proposed
Amount Maximum Maximum Amount of
Title of Each Class of to be Offering Price Aggregate Registration
Securities to be Registered Registered Per Unit(1) Offering Price(1) Fee(2)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.001 par value 20,294,877 $ 1.203125 $ 24,417,273 $ 7,203
shares(3)
</TABLE>
================================================================================
(1) Estimated solely for purposes of calculating the Registration Fee.
(2) Calculated pursuant to Rule 457(c) of the Securities Act.
(3) Includes 20 million shares issuable upon exercise of outstanding
Warrants. Pursuant to Rule 416, this Registration Statement also covers
such indeterminable additional shares as may become issuable as a
result of future adjustments in accordance with the terms of the
Warrants and the Options.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE> 2
PROSPECTUS
20,294,877 SHARES
CHECKERS DRIVE-IN RESTAURANTS, INC.
COMMON STOCK
Of the 20,294,877 shares of common stock, $.001 par value per share
("Common Stock") of Checkers Drive-In Restaurants, Inc., a Delaware corporation
(the "Company" or "Checkers"), being offered hereby, 294,877 shares are held by
the Selling Stockholders (see "Selling Stockholders") and 20,000,000 shares will
be issued upon exercise of outstanding common stock purchase warrants (the
"Warrants") of the Company. The Company will not receive any of the proceeds
from the sale of the Common Stock by the Selling Stockholders. The last reported
sale price of the Common Stock, which is traded under the symbol "CHKR," on the
NASDAQ National Market (the "NMS") on August 20, 1998 was $0.875 per share.
SEE "RISK FACTORS" COMMENCING ON PAGE 3 FOR A DISCUSSION OF CERTAIN
INFORMATION THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE
COMMON STOCK.
--------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
--------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER,
DEALER OR AGENT. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE INFORMATION SET FORTH IN THIS PROSPECTUS OR IN THE AFFAIRS
OF THE COMPANY OR ANY OF ITS AFFILIATES SINCE THE RESPECTIVE DATES OF THIS
PROSPECTUS.
The date of this Prospectus is August 25, 1998
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files periodic reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). Such
periodic reports, proxy statements and other information may be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, at its Chicago Regional
Office at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and at
its New York Regional Office at 7 World Trade Center, Suite 1300, New York, New
York 10048. Copies of such materials can be obtained upon written request from
the Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. The
Commission also maintains a site on the World Wide Web at http://www.sec.gov
that contains reports, proxy statements and other information regarding
registrants that file electronically with the Commission. The Company's Common
Stock is quoted on the NMS, and reports, proxy statements and other information
concerning the Company may be inspected at the offices of the National
Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C.
20006.
This Prospectus constitutes part of a Registration Statement on Form
S-3 (including all amendments and exhibits, the "Registration Statement") filed
by the Company with the Commission under the Securities Act of 1933, as amended
(the "Securities Act"). This Prospectus does not contain all of the information
set forth in the Registration Statement, certain items of which are contained in
schedules and exhibits to the Registration Statement as permitted by the rules
and regulations of the Commission. Reference is hereby made to the Registration
Statement and the exhibits thereto for further information with respect to the
Company. Any statements contained herein concerning the provisions of any
contract, agreement or other document are not necessarily complete, and in each
instance, reference is made to the copy of such contract, agreement or other
document filed as an exhibit to the Registration Statement or otherwise filed
with the Commission. For further information, reference is made to the
Registration Statement, including exhibits and schedules thereto. The
Registration Statement can be inspected and copied at the Public Reference Room
of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with
the Commission, are incorporated herein and specifically made a part hereof by
this reference: (i) the Company's Annual Report on Form 10-K for the fiscal year
ended December 29, 1997, as amended (the "1997 10-K"); (ii) the Company's
Quarterly Reports on Form 10-Q for the periods ending March 23, 1998 and June
15, 1998; (iii) the Company's Proxy Statement dated May 15, 1998; and (iv) the
description of the Common Stock which is contained in the Company's Prospectus
dated September 26, 1991. In addition, all documents filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date of this Prospectus and prior to the termination of the offering made
hereby shall be deemed to be incorporated by reference into this Prospectus and
to be part hereof from the respective dates of filing of such documents with the
Commission. Any statement contained herein or in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
This Prospectus incorporates documents by reference which are not
presented herein or delivered herewith. The Company will provide without charge
to each person to whom this Prospectus is delivered, upon written or oral
request, a copy of any or all of the documents that are incorporated herein by
reference, other than exhibits to such documents not specifically incorporated
by reference therein. Such requests should be addressed to the Company's
principal office: Checkers Drive-In Restaurants, Inc., 14255
-2-
<PAGE> 4
49th Street North, Building 1, Clearwater, Florida 33762, Attention: Secretary,
Telephone No.: (727) 519-2000.
RISK FACTORS
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS CONTAINS OR INCORPORATES BY REFERENCE
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES
ACT OF 1933, AS AMENDED. DISCUSSIONS CONTAINING SUCH FORWARD-LOOKING STATEMENTS
MAY BE FOUND IN THE MATERIAL SET FORTH UNDER "RISK FACTORS" AS WELL AS WITHIN
THE PROSPECTUS GENERALLY, INCLUDING THE DOCUMENTS INCORPORATED BY REFERENCE
HEREIN. ALSO, DOCUMENTS SUBSEQUENTLY FILED BY THE COMPANY WITH THE COMMISSION
AND INCORPORATED HEREIN BY REFERENCE MAY CONTAIN FORWARD-LOOKING STATEMENTS. THE
COMPANY CAUTIONS INVESTORS THAT ANY FORWARD-LOOKING STATEMENTS MADE BY THE
COMPANY ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND THAT ACTUAL RESULTS COULD
DIFFER MATERIALLY FROM THOSE IN THE FORWARD-LOOKING STATEMENTS AS A RESULT OF
VARIOUS FACTORS, INCLUDING BUT NOT LIMITED TO THE FOLLOWING:
(I) THE COMPANY COMPETES WITH NUMEROUS WELL ESTABLISHED
COMPETITORS WHO HAVE SUBSTANTIALLY GREATER FINANCIAL
RESOURCES AND LONGER OPERATING HISTORIES THAN THE COMPANY.
COMPETITORS HAVE INCREASINGLY OFFERED SELECTED FOOD ITEMS
AND COMBINATION MEALS, INCLUDING HAMBURGERS, AT DISCOUNTED
PRICES, AND CONTINUED DISCOUNTING BY COMPETITORS MAY
ADVERSELY AFFECT REVENUES AND PROFITABLILITY OF COMPANY
RESTAURANTS.
(II) THE COMPANY WILL BE NEGATIVELY IMPACTED IF THE COMPANY IS
UNABLE TO SUSTAIN SAME STORE SALES INCREASES THAT WERE
EXPERIENCED DURING THE FIRST TWO QUARTERS OF 1998. SALES
INCREASES WILL BE DEPENDENT, AMONG OTHER THINGS, ON SUCCESS
OF COMPANY ADVERTISING AND PROMOTION OF NEW AND EXISTING
MENU ITEMS. NO ASSURANCES CAN BE GIVEN THAT SUCH
ADVERTISING AND PROMOTIONS WILL IN FACT BE SUCCESSFUL.
THE COMPANY MAY ALSO BE NEGATIVELY IMPACTED BY OTHER FACTORS COMMON TO THE
RESTAURANT INDUSTRY SUCH AS: CHANGES IN CONSUMER TASTES AWAY FROM RED MEAT AND
FRIED FOODS; INCREASES IN THE COST OF FOOD, PAPER, LABOR, HEALTH CARE, WORKERS'
COMPENSATION OR ENERGY; AN INADEQUATE NUMBER OF HOURLY PAID EMPLOYEES; AND/OR
DECREASES IN THE AVAILABILITY OF AFFORDABLE CAPITAL RESOURCES. THE COMPANY
CAUTIONS THE READER THAT THIS LIST OF RISK FACTORS MAY NOT BE EXHAUSTIVE,
PARTICULARLY WITH RESPECT TO FUTURE FILINGS.
DECREASING RESTAURANT SALES
While the Company did experience a comparable store sales increase
of 7.5% during the first two quarters of 1998, average net sales per
Company-operated restaurant open for a full year declined each fiscal quarter
from the second quarter of 1993 through the fourth quarter of 1997. Average net
sales for Company-operated restaurants opened for a full year were approximately
$1,021,000 and $605,000 for the 12-month periods ended March 31, 1993 and June
15, 1998, respectively. Management believes the decrease in average restaurant
sales over this time period is primarily attributable to increased sales
pressure from competitor discounting. The Company also cannibalized certain
markets in fiscal 1993 and 1994. Cannibalization results from the addition of
Company restaurants in existing markets in an attempt to increase market share,
to reduce the possibility of entry by other double drive-thru concepts, to
provide a sufficient sales base to support broadcast media advertising and to
enhance customer convenience. As a result of the addition of Company restaurants
in existing markets, the sales of certain Company restaurants have been
adversely affected. See "Risk Factors -- Competitive Environment."
HISTORY OF OPERATING LOSSES
-3-
<PAGE> 5
Although the Company had an operating profit of approximately $2.7
million in the first two quarters of 1998, the Company has reported losses from
operations in each of its last three fiscal years. Restaurant margins before
advertising expense in 1997 increased from 4.0% to 10.9%, primarily as a result
of reduced food, paper and labor costs as a percentage of sales. However,
comparable restaurant sales decreased by 9.9% in 1997 compared to 1996. In 1997,
under the direction of new top management, the Company implemented new programs
designed to improve food, paper and labor costs in its restaurants, with a
resulting decrease in these combined costs of 7.6% of sales in 1997. While
management believes that such programs contributed to the Company's operating
profit in the first two quarters of 1998, no assurance can be given that such
programs will result in an operating profit in future quarters or for the full
fiscal year.
COMPETITIVE ENVIRONMENT
The fast food restaurant industry is highly competitive and can be
significantly affected by many factors, including changes in local, regional or
national economic conditions, changes in consumer tastes, consumer concerns
about the nutritional quality of quick-service food and increases in the number
of, and particular location of, competing quick-service restaurants. Factors
such as inflation, increases in food, labor and energy costs, the availability
and cost of suitable sites, fluctuating interest and insurance rates, state and
local regulations and licensing requirements and the availability of an adequate
number of hourly-paid employees can also adversely affect the fast food
restaurant industry. In addition, major chains, which have operating concepts
similar to or competitive with the Company and which also have substantially
greater financial resources and longer operating histories than the Company,
dominate the fast food restaurant industry. The Company competes primarily on
the basis of food quality, price and speed of service. A significant change in
pricing or other marketing strategies by one or more of these competitors could
have an adverse impact on sales, earnings and growth of the Company. All of the
major fast food chains have increasingly offered selected food items and
combination meals at discounted prices. Beginning generally in the summer of
1993, the major fast food hamburger chains began to intensify their promotions
of value priced meals, many specifically targeting the $.99 price point at which
the Company sells its "Champ Burger(R)." This increased promotional activity has
been sustained, and management believes that it has had a negative impact on the
Company's sales. While the Company cannot predict the duration of this
promotional activity or the extent to which this pricing may become more or less
competitive, such pricing could have a continued adverse effect on the Company's
sales and earnings.
CERTAIN FINANCING CONSIDERATIONS; LEVERAGE
As of June 15, 1998, the Company had outstanding approximately $25.6
million principal amount of indebtedness under its Amended and Restated Credit
Agreement dated as of November 22, 1996, as amended (the "Restated Credit
Agreement"). Pursuant to the Restated Credit Agreement, the Company is required
to maintain minimum consolidated EBITDA of $2.75 million for each four-week
period after December 29, 1997. Consolidated EBITDA is defined as the sum of
consolidated net income, interest expense, provision for income taxes and
depreciation, amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) minus non-cash items, in each case on a consolidated basis
and determined in accordance with generally accepted accounting principles. In
addition, there are limits on the Company's ability to incur capital
expenditures, additional indebtedness or liens and on its ability to enter into
transactions with affiliates. In February 1997, the Company obtained a waiver of
its obligation under the Restated Credit Agreement to comply with the minimum
consolidated EBITDA requirement, and in December 1997, the Company obtained an
additional waiver of such obligation for the period from December 2, 1997
through March 23, 1998. While the Company is currently in compliance with the
minimum consolidated EBITDA requirement, no assurance can be given that the
Company will be able to comply in the future or to obtain an additional waiver
if necessary. The degree to which the Company's assets are leveraged and the
degree to which the Company is unable to meet the covenants referred to above
may adversely affect the Company's ability to finance its future
-4-
<PAGE> 6
operations and could limit its ability to pursue business opportunities that may
be in the interests of the Company and its stockholders.
RELIANCE ON KEY PERSONNEL
Significant management changes have occurred since the end of the
third quarter of fiscal 1997. In November 1997, James J. Gillespie became the
Chief Executive Officer of Checkers and Rally's Hamburgers, Inc., a Delaware
corporation ("Rally's"). In March 1998, Harvey Fattig became Executive Vice
President and Chief Operating Officer of Checkers and Rally's. In December 1997,
Joseph N. Stein, Executive Vice President and Chief Administrative Officer of
Checkers, became Executive Vice President and Chief Financial Officer of
Rally's. In January 1998, Richard Peabody became Chief Financial Officer of
Checkers. In addition, effective November 30, 1997, Rally's and Checkers entered
into a Management Services Agreement pursuant to which Checkers has agreed to
provide key services to Rally's, including: executive management, financial
planning and accounting, franchise, purchasing and human resources. As a result
of this arrangement, the positions of substantially all of Rally's corporate
personnel were eliminated by the end of January 1998, and Checkers' corporate
personnel are providing substantially all services necessary for the day-to-day
operations of Rally's business. In addition to Messrs. Gillespie, Fattig and
Stein, James T. Holder, Senior Vice President, General Counsel and Secretary of
the Company, serves as Senior Vice President, Assistant General Counsel and
Secretary of Rally's. The success of Checkers will be dependent on the ability
of the new senior management team of Checkers and Rally's to manage the
operations of both companies. In addition, the Company's ability to attract and
retain experienced successful executives to the management team will affect
Checkers' performance. The loss of one or more members of senior management
could adversely affect the Company's business and development.
SHARES ELIGIBLE FOR FUTURE ISSUANCE AND SALE; DILUTION OF VOTING POWER
As of August 13, 1998, (i) 73,411,112 shares of Common Stock were
outstanding, (ii) approximately 34.8 million shares of Checkers Common Stock
were reserved for issuance in connection with the exercise of outstanding
options and warrants, and (iii) approximately 5.2 million options to purchase
shares of Common Stock were made available for grant under the Company's stock
option plans pursuant to the approval of the Company's stockholders at the
Annual Meeting held on June 11, 1998. In addition, the Company has increased the
number of shares available under its 1990 Stock Option Plan by 4,500,000,
pursuant to the approval of the Company's stockholders at the Annual Meeting to
be held on June 11, 1998. The Company currently has an obligation to register
the offer and sale of approximately 20.3 million shares of the Common Stock. The
individuals or entities having registration rights for Common Stock will be
entitled to sell such stock subject to any limitations under federal securities
laws resulting from their relationship to the Company. There can be no assurance
that any of these sales will not have an adverse effect on the market price for
the Common Stock.
CONTINUED LISTING ON NASDAQ NATIONAL MARKET
NASDAQ has adopted amendments to the requirements for continued
listing on the NMS, including a requirement that the closing price of the common
stock of each listed company not fall below the minimum trading value of $1.00
per share for any 30-day period. The market price of the Common Stock has closed
below $1.00 an aggregate of 65 days from January 1 through August 13, 1998, with
the longest consecutive period being 27 days. As of August 20, 1998, the closing
per share price of the Common Stock on the NMS was $0.875 per share. In
addition, it is possible that the market price of the Common Stock could be
further adversely affected as a result of anticipated dispositions of Common
Stock which the Company has an obligation to register under the Securities Act.
If the market price of the Common Stock were to remain below $1.00 per share, no
assurance can be given that the Company will be able to continue to list the
Common Stock on the NMS. See "Risk Factors -- Shares Eligible
-5-
<PAGE> 7
for Future Issuance and Sale; Dilution of Voting Power."
ANTI-TAKEOVER PROVISIONS
The Company's Certificate of Incorporation and Bylaws contain
provisions restricting the ability of stockholders to: (i) call meetings of
stockholders; (ii) nominate directors; (iii) present proposals for stockholder
consideration; (iv) enter into certain transactions with the Company; and (v)
amend the Certificate of Incorporation or Bylaws. Such provisions may have the
effect of discouraging third parties from investing in or attempting to take
control of the Company.
CONTROL BY PRINCIPAL STOCKHOLDER
Rally's holds 19,130,960 shares of the Company's Common Stock
(approximately 26.1% of the outstanding shares). Rally's announced on January 9,
1998 that it intends to acquire in open market purchases, from time to time, up
to 1,000,000 shares of Common Stock of the Company, of which it has purchased
30,000 shares. No other stockholder of the Company beneficially owns 5% or more
of the Company's Common Stock. Consequently, Rally's may be deemed to have the
practical ability to have a significant influence on all matters put to a vote
of the Company's stockholders.
GOVERNMENT REGULATION
The restaurant business is subject to extensive federal, state and
local government regulations relating to the development and operations of fast
food restaurants, including regulations relating to building, parking, ingress
and egress and zoning requirements and the preparation and sale of food and laws
that govern the Company's relationship with their respective employees, such as
minimum wage requirements, overtime and working conditions and citizenship
requirements. The failure to obtain or retain food licenses or substantial
increases in the minimum wage could adversely affect operations. The Company
does not anticipate that the increases in the minimum wage will result in
material upward pressure on the Company's prevailing wage scale. The Company is
also subject to federal regulation and ceratin state laws which regulate the
offer and sale of franchises to their respective franchisees.
THE COMPANY
Checkers develops, produces, owns, operates and franchises
quick-service "double drive-thru" restaurants. Checkers' restaurants are
designed to provide fast and efficient automobile-oriented service incorporating
a 1950's diner and art deco theme, with a highly visible, distinctive and
uniform look that is intended to appeal to customers of all ages. The
restaurants feature a limited menu of high quality hamburgers, cheeseburgers and
bacon cheeseburgers, specially seasoned french fries, hot dogs and chicken
sandwiches as well as related items such as soft drinks and old fashioned
premium milk shakes. The Company recently launched a new campaign with the
tagline, "Fresh, because we just made it." Checkers wants consumers to know that
their food is always made fresh on the spot, never pre-made like other quick
service restaurants. As of June 15, 1998, there were approximately 483 Checkers
restaurants operating in primarily in the Southeast and Mid-Atlantic regions.
The Company's executive offices are located at 14255 49th Street North, Building
1, Clearwater, Florida 33762, and its telephone number is (727) 519-2000.
USE OF PROCEEDS
If all of the Warrants are exercised, the Company will receive
approximately $14.9 million in net proceeds upon the issuance of an aggregate of
20 million shares of Common Stock. While the Company is contractually obligated
to register the offer and sale of the shares of Common Stock underlying the
-6-
<PAGE> 8
Warrants, no assurance can be given that any of such proceeds received by the
Company would be added to its general working capital. The Company will not
receive any proceeds from the sale of Common Stock by the Selling Stockholders.
-7-
<PAGE> 9
SELLING STOCKHOLDERS
The following table sets forth: (i) the names of the persons owning
certain of the shares of Common Stock to which this Prospectus relates; (ii) the
number of shares of Common Stock beneficially owned by each such person as of
August 13, 1998; (iii) the number of shares of Common Stock which may be sold by
each such person pursuant hereto; and (iv) the number of shares of Common Stock
to be owned, and the corresponding percentage of the total number of shares of
Common Stock to be outstanding assuming the sale of all of the shares of Common
Stock offered pursuant hereto. The table does not include shares of Common Stock
which may be issued upon exercise of the Warrants.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP AFTER SALE
SHARES TO BE HELD
ASSUMING
SHARES BENEFICIALLY SHARES WHICH MAY ALL OFFERED PERCENTAGE OF
SELLING STOCKHOLDER OWNED(1) BE OFFERED SHARES ARE SOLD OUTSTANDING (2)
- ------------------- ------------------- ---------------- ------------------ ---------------
<S> <C> <C> <C> <C>
Glen Cochran(3) 45,353 45,353(4) 45,353 *
Raymond James &
Associates(5) 249,524 249,524(6) -0- *
</TABLE>
- ----------------------
* Represents less than 1% of class.
(1) For purposes of this table, a person or a group of persons is
deemed to have "beneficial ownership" as of a given date of any shares which
such person has the right to acquire within 60 days after such date. For
purposes of computing the percentage of outstanding shares held by each person
or group of persons named above on a given date, any shares which such person or
persons has the right to acquire within 60 days after such date are deemed to be
outstanding, but are not deemed to be outstanding for the purpose of computing
the percentage ownership of any other person.
(2) Based on 73,411,112 shares outstanding as of August 13, 1998.
(3) Mr. Cochran served as Executive Vice President of Fidelity
National Financial Title Insurance Company until September 1997.
(4) Acquired in a private placement in February 1997.
(5) Raymond James & Associates was engaged by Checkers at various
times through July 1997 to provide financial advice. Such firm provided
financial advice in connection with a private placement by Checkers in February
1997.
(6) Shares acquired by Raymond James & Associates from Checkers as
partial payment for its services.
The shares of Checkers Common Stock offered hereby may be sold on
the NMS, at prices then prevailing, in negotiate transactions or otherwise. With
respect to transactions on the NMS, any Selling Stockholder will pay the regular
commissions of brokers for effecting such sales. With respect to Common Stock to
be issued on exercise of the Warrants, the Company will issue such shares to the
holder of such Warrant upon receipt of a notice of exercise and the
consideration called for pursuant to the terms thereof.
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<PAGE> 10
CERTAIN LEGAL MATTERS
Certain legal matters in connection with the validity of the shares
of Common Stock to which this Prospectus relates will be passed upon for the
Company by James T. Holder, Esq., Senior Vice President, General Counsel and
Secretary of the Company.
EXPERTS
The consolidated financial statements and schedules of Checkers
Drive-In Restaurants, Inc. and subsidiaries as of December 29, 1997 and December
30, 1996 and for each of the years in the three-year period ended December 29,
1997, included in the Company's Form 10-K for the fiscal year ended December 29,
1997, have been incorporated by reference herein and in the Registration
Statement in reliance upon the report of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
-9-
<PAGE> 11
24,417,273
SHARES
COMMON STOCK
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information . . . . . . . . . . . . . . . . . . . . . . 2
Documents Incorporated By Reference . . . . . . . . . . . . . . . 2
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Company . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . 6
Selling Stockholders . . . . . . . . . . . . . . . . . . . . . . 8
CHECKERS DRIVE-IN RESTAURANTS, INC.
Certain Legal Matters . . . . . . . . . . . . . . . . . . . . . . 9
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
</TABLE>
PROSPECTUS
AUGUST 25, 1998
<PAGE> 12
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is a statement of estimated fees and expenses payable or
reimbursable by the Registrant in connection with the issuance and distribution
of the Common Stock, subject to future contingencies.
<TABLE>
<S> <C>
SEC registration fee ........................................ $ 7,203
Legal fees .................................................. 25,000
Accountants' fees ........................................... 1,000
Blue sky fees ............................................... 5,000
Miscellaneous ............................................... 15,000
---------
TOTAL $ 53,203
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL") provides that a
Delaware corporation may indemnify any person against expenses, judgments, fines
and amounts paid in settlements actually and reasonably incurred by any such
person in connection with a threatened, pending or completed action, suit or
proceeding in which he is involved by reason of the fact that he is or was a
director, officer, employee or agent of such corporation, provided that (i) he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and (ii) with respect to any
criminal action or proceeding, he had no reasonable cause to believe his conduct
was unlawful. If the action or suit is by or in the name of the corporation, the
corporation may indemnify any such person against expenses actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation, except that no
indemnification may be made in respect to any claim, issue or matter as to which
such person shall have been adjudged to be liable for negligence or misconduct
in the performance of his duty to the corporation, unless and only to the extent
that the Delaware Court of Chancery or the court in which the action or suit is
brought determines upon application that, despite the adjudication of liability
but in light of the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expense as the court deems proper.
The Company's Bylaws provide that the Company shall indemnify its directors
and such officers, employees and agents as it may from time to time designate,
to the fullest extent permitted by Section 145 of the DGCL, as now existing or
as may hereafter be amended.
In accordance with Section 102(b)(7) of the DGCL, the Company's Restated
Certificate of Incorporation limits the personal liability of its directors for
violations of their fiduciary duty. The Certificate of Incorporation eliminates
each director's liability to the Registrant or its stockholders for monetary
damages except (i) for any breach of the director's duty of loyalty to the
Registrant or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
the section of the Delaware law providing for liability of directors for
unlawful payment of dividends or unlawful stock purchases or redemptions, or
(iv) for any transaction from which a director derived an improper personal
benefit. The effect of this provision is to eliminate the personal liability of
directors for monetary damages for actions involving a breach of their fiduciary
duty of care, including any such actions involving gross negligence. This
provision will not, however, limit in any way the liability of directors for
violations of the Federal securities laws. In addition, the stockholders and the
Board of Directors of the Company have approved the execution by the Company of
indemnification agreements with the Directors and
II-1
<PAGE> 13
certain officers of the Company, the form of which was filed with the Securities
and Exchange Commission on September 26, 1992, as Exhibit 4.4 to the
Registration Statement of the Company on Form S-1 (File No. 33-42996).
Checkers carries Directors' and Officers' liability insurance, with coverage
of $40 million, which is maintained in effect on a yearly basis, expiring on
March 1, 1999.
The above discussion of the Company's Certificate of Incorporation and Bylaws
and Sections 102(b)(7) and 145 of the Delaware General Corporation Law is not
intended to be exhaustive and is qualified in its entirety by such Certificate
of Incorporation, Bylaws and statutes.
ITEM 16. EXHIBITS.
(a) The following is a list of Exhibits filed herewith as a part of this
Registration Statement:
<TABLE>
<CAPTION>
Exhibit Number Description of Document
<S> <C>
5 Opinion of James T. Holder, Esq.
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of James T. Holder, Esq. (see Exhibit 5)
24 Power of Attorney (see page II-4)
-------
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made of the
securities registered hereby, a post-effective amendment to this Registration
Statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933 (the "Act");
(ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Securities and Exchange Commission (the "Commission")
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement; and
(iii) to include any material information with respect to
the plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement.
provided, however, that the undertakings set forth in paragraphs (a)(1)(i) and
(a)(1)(ii) of this section do not apply if the registration statement is on Form
S-3, Form S-8 or Form F-3, and the information required to be
II-2
<PAGE> 14
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the Act, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered hereby which remain unsold at the termination of
the offering.
(b) The undersigned Registrant hereby undertakes, that, for purposes of
determining any liability under the Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-3
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Clearwater, State of Florida, on the 19th day of
August, 1998.
CHECKERS DRIVE-IN RESTAURANTS, INC.
*
BY
--------------------------------------
James J. Gillespie
President and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned directors and officers of Checkers Drive-In, Inc.
do hereby constitute and appoint James J. Gillespie, Joseph N. Stein and James
T. Holder or any of them, our true and lawful attorneys and agents, to do any
and all acts and things in our name and behalf in our capacities as directors
and officers and to execute any and all instruments for us and in our names in
the capacities indicated below, which said attorneys and agents, or either of
them, may deem necessary or advisable to enable said corporation to comply with
the Securities Act of 1933, as amended, and any rules, regulations, and
requirements of the Securities and Exchange Commission, in connection with this
Registration Statement, including specifically, but without limitation, power
and authority to sign for us or any of us in our names and in the capacities
indicated below, any and all amendments (including post-effective amendments) to
this Registration Statement, or any related registration statement that is to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933,
as amended; and we do hereby ratify and confirm all that the said attorneys and
agents, or either of them, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* President, Chief August 19, 1998
James J. Gillespie Executive Officer and
Director
(Principal Executive
Officer)
</TABLE>
II-4
<PAGE> 16
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Vice President and Chief August 19, 1998
- -------------------------- Financial Officer
Richard A. Peabody (Principal Financial and
Accounting Officer)
* Chairman of the Board August 19, 1998
- -------------------------- and Director
William P. Foley, II
Director August 19, 1998
- --------------------------
Terry N. Christensen
* Director August 19, 1998
- -------------------------
Frederick E. Fisher
* Director August 19, 1998
- -------------------------
Clarence V. McKee
* Director August 19, 1998
- ------------------------
Burt Sugarman
* Director
- ------------------------
C. Thomas Thompson
*By: s/ James T. Holder August 19, 1998
---------------------------
JAMES T. HOLDER
ATTORNEY-IN-FACT
</TABLE>
II-5
<PAGE> 1
EXHIBIT 5
August 20, 1998
Checkers Drive-In Restaurants, Inc.
14255 49th Street North, Building 1
Clearwater, Florida 33762
Re: Registration Statement on Form S-3 (File No. 333-55825)
Gentlemen:
You have requested my opinion as General Counsel for Checkers Drive-In
Restaurant, Inc., a Delaware corporation (the "Company"), in connection with
(i) the issuance by the Company of up to 20,000,000 shares (the "Warrant
Shares") of the Company's Common Stock, $0.001 par value per share (the "Common
Stock"), upon exercise of common stock purchase warrants (the "Warrants") and
(ii) the offer and sale by certain stockholders of up to 294,877 shares of the
Common Stock which were acquired from the Company in private placements (the
"Stockholder Shares" and collectively with the Warrant Shares, the "Shares").
The offer and sale of the Shares are the subject of the Company's Registration
Statement on Form S-3 (File No. 333-55825), as amended (the "Registration
Statement").
In rendering my opinion herein, I have assumed, with your permission: the
genuineness and authenticity of all signatures on original documents submitted
to me; the authenticity of all documents submitted to me as originals; the
conformity to originals of all documents submitted to me as copies or
facsimiles; the continued accuracy of all certificates and other documents from
public officials dated earlier than the date of this letter; the Registration
Statement being declared effective by the Securities and Exchange Commission;
the issuance by any necessary regulatory agencies of appropriate permits,
consents, approvals, authorizations and orders relating to the offering and
sale of the Shares; the offer and sale of the Shares being made in the manner
set forth in the Registration Statement and pursuant to said permits, consents
approvals, authorizations and orders; the receipt by the Company of full and
valid consideration for the Shares to be issued by it upon exercise of the
Warrants. In addition, I have made such legal and factual examinations and
inquiries as I have deemed necessary or appropriate for purposes of this
opinion.
Based on the foregoing, it is my opinion that the Stockholder Shares are,
and the Warrant Shares, when issued, will be, validly issued, fully paid and
non-assessable.
This opinion is addressed solely to the Company, and no one else has the
right to rely upon it, nor may anyone release it, quote from it, or employ it
in any transaction other than those discussed herein without the written
consent of the undersigned; however, the undersigned hereby consents to the
filing of this opinion as an exhibit to, and the references to the undersigned
contained in, the Registration Statement.
Respectfully submitted,
James T. Holder
Senior Vice President and General Counsel
<PAGE> 1
EXHIBIT 23.1
ACCOUNTANTS' CONSENT
The Board of Directors
Checkers Drive-In Restaurants, Inc.:
We consent to incorporation by reference in the registration statement on Form
S-3 of Checkers Drive-In Restaurants, Inc. of our report dated February 27, 1998
relating to the consolidated balance sheets of Checkers Drive-In Restaurants,
Inc. and subsidiaries as of December 29, 1997 and December 30, 1996, and the
related consolidated statements of operations, stockholders' equity and cash
flows for each of the years in the three-year period ended December 29, 1997,
and all related schedules, which report appears in the December 29, 1997 annual
Report on Form 10-K of Checkers Drive-In Restaurants, Inc. and to the reference
to our firm under the heading "Experts" in the registration statement.
KPMG Peat Marwick LLP
Tampa, Florida
August 19, 1998
