SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
--------------------------
Date of Report ( Date of earliest event reported):January 17, 1997
THE KRYSTAL COMPANY
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Tennessee 0-20040 62-0264140
-------------- ------------------- ------------------
(State of (Commission file No.) (IRS Employer
incorporation) Identification No.)
One Union Square, Chattanooga, TN 37402
-----------------------------------------------------------
(Address of principal executive offices , including zip code)
(423) 757-1550
----------------------------------------------------
(Registrant's telephone number, including area code)
Item 5. Other Events.
On January 17, 1997, The Krystal Company announced the settlement, subject
to court approval, of the wage claim litigation pertaining to alleged
violations of the Fair Labor Standards Act of 1938.
The following is the text of a press release issued by The Krystal Company
on January 17, 1997.
KRYSTAL COMPANY SETTLES WAGE LITIGATION
CHATTANOOGA, TENN., January 17, 1997 - The Krystal Company said Friday that
it settled the wage claim litigation brought against it by current and former
employees over violations of the Fair Labor Standards Act.
Krystal said the claims were settled for about $13 million.
Carl Long, chief executive, said, "We are pleased to have reached this
settlement which allows us to achieve our objective in seeking bankruptcy
protection of fully and finally resolving the wage claims against the company.
We believe this is a positive outcome for Krystal, and we look forward to
emerging from our bankruptcy proceeding as a healthier company."
Krystal said that it expects its plan of reorganization to be approved by the
bankruptcy court by the end of the first quarter of 1997 and that shortly
thereafter it would emerge from Chapter 11 proceedings.
Krystal filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy
Code with the U.S. Bankruptcy Court in December 1995 in order to resolve the
wage claim litigation brought against it.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
January 24, 1997 THE KRYSTAL COMPANY
By: Camden B. Scearce
-----------------------
Camden B. Scearce
Vice President and
Chief Financial Officer
