As filed with the Securities and Exchange Commission on May____, 1996
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-8
Registration Statement
Under
The Securities Act of 1933
GRILL CONCEPTS, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3319172
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
11661 San Vicente Blvd., Ste. 404, Los Angeles, California 90049
(Address of Principal Executive Offices) (Zip Code)
GRILL CONCEPTS, INC.
1995 STOCK OPTION PLAN
(Full title of the plan)
Copy to:
Robert Spivak Michael Sanders
Grill Concepts, Inc. Vanderkam & Sanders
11661 San Vicente Blvd. 1111 Caroline
Suite 404 Suite 2905
Los Angeles, California 90049 Houston, Texas 77010
(310) 820-5559 (713) 655-0015
(Name, address and telephone
number of agent for service)
Approximate date of proposed sales pursuant to the plan: From time to time
after the effective date of this Registration Statement.
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=================================================================================================================
Proposed maximum Proposed maximum Amount of
Title of securities Amount to be offering price per aggregate offering registration
to be registered registered<F1> share<F2> price fee
- -----------------------------------------------------------------------------------------------------------------
<S> <S> <C> <C> <C>
Common Stock, $.00001 par value 1,500,000 $ 1.4627 $ 2,194,054.00 $ 756.57
=================================================================================================================
<FN>
<F1> An undetermined number of additional shares may be issued if the
antidilution provisions of the 1995 Stock Option Plan become operative.
<F2> Calculated in accordance with Rule 457(h) solely for the purpose of
determining the registration fee. Offering prices for shares underlying
outstanding options are the exercise prices of the various outstanding
options. With respect to authorized but unissued options reserved under the
plan, the offering price is the average of the closing bid and asked price
($1.53125) of the Common Stock on May 14, 1996, as reported on the Nasdaq
Small-Cap Market.
</FN>
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION
Information required by Item 1 is included in documents sent or given to
participants in the Plan pursuant to Rule 428(b)(1) of the Securities Act.
ITEM 2. REGISTRATION INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION
Information required by Item 2 is included in documents sent or given to
participants in the Plan pursuant to Rule 428(b)(1) of the Securities Act.
<PAGE>
CROSS REFERENCE SHEET
FOR PROSPECTUS TO BE USED FOR REOFFERS OF
SHARES OF COMMON STOCK BY AFFILIATES
GRILL CONCEPTS, INC.
<TABLE>
<CAPTION>
Registration Statement
Item and Heading Prospectus Heading
---------------- ------------------
<S> <C> <C>
1. Forepart of the Registration Statement and Outside
Front Cover Page of Prospectus............................ Cover Page
2. Inside Front and Outside Back Cover Pages of
Prospectus................................................ Available Information; Incorporation of
Certain Documents by Reference
3. Summary Information, Risk Factors and Ratio of
Earnings to Fixed Charges................................. General Information
4. Use of Proceeds........................................... Use of Proceeds
5. Determination of Offering Price........................... Not applicable
6. Dilution ................................................. Not applicable
7. Selling Security Holders.................................. Selling Shareholders
8. Plan of Distribution...................................... Plan of Distribution
9. Description of Securities to be Registered................ Not applicable
10. Interests of Named Experts and Counsel.................... Legal Matters
11. Material Changes.......................................... Not applicable
12. Incorporation of Certain Information by Reference......... Incorporation of Certain Documents by
Reference
13. Disclosure of Commission Position on Indemnification
For Securities Act Liabilities............................ Not applicable
</TABLE>
<PAGE>
PROSPECTUS
470,000 Shares
GRILL CONCEPTS, INC.
Common Stock
$.00001 par value
This Prospectus relates to the reoffer and resale by various persons (the
"Selling Shareholders") of shares (the "Shares") of Common Stock, $.00001 per
value (the "Common Stock"), of Grill Concepts, Inc. (the "Company") that may be
issued by the Company to the Selling Shareholders upon the exercise of
outstanding stock options granted pursuant to the 1995 Stock Option Plan (the
"1995 Plan") of the Company. The offer and sale of the Shares to the Selling
Shareholders is registered under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a registration statement, of which this
Prospectus forms a part. The Shares are being reoffered and resold for the
account of the Selling Shareholders and the Company will not receive any of the
proceeds from the resale of the Shares.
The Selling Shareholders have advised the Company that the resale of their
Shares may be effected from time to time on the Nasdaq Small-Cap Market
("Nasdaq"), or in negotiated transactions, or a combination of such methods of
sale, at fixed prices which may be changed, at market prices prevailing at the
time of sale, at prices related to such prevailing market prices, or at
negotiated prices. See "Plan of Distribution." The Company will bear all
expenses in connection with the preparation of this Prospectus.
The Common Stock of the Company is traded on Nasdaq under the symbol
"GRIL". On May 14, 1996, the last reported bid price of the Common Stock, as
reported on Nasdaq, was $1.47.
Any sales by the Selling Shareholders will be made subject to certain
volume limitations. During any three month period during which this Prospectus
is effective, each Selling Shareholder and affiliates may sell a maximum of the
greater of one percent of the outstanding Common Stock of the Company or the
average weekly trading volume of the Common Stock during the four calendar weeks
preceding the date of the sale.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
--------------------
The date of this Prospectus is May 21, 1996
<PAGE>
TABLE OF CONTENTS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 3
General Information........................................................ 3
Use of Proceeds............................................................ 4
Selling Shareholders....................................................... 4
Plan of Distribution....................................................... 4
Legal Matters.............................................................. 4
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 reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy statements
and other information filed by the Company can be inspected and copied at the
public reference facilities maintained by the Commission at 450 Fifth Street,
Room 1024, Washington, D.C. 20549 or at the Commission's Regional Offices in New
York (7 World Trade Center, Suite 1300, New York, New York 10048) and Chicago
(500 West Madison Street, Suite 1400, Chicago, Illinois 60661). Copies of such
material can be obtained from the Public Reference Section of the Commission in
Washington, D.C. at prescribed rates.
2
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-KSB for the year ended December 31,
1995, the Company's Quarterly Report on Form 10-QSB for the quarter ended March
31, 1996 and the description of securities included in Form 8-A filed with the
Commission on March 21, 1994 (Commission File No. 0-23226) are incorporated by
reference in this Prospectus and shall be deemed to be a part hereof. All
reports and other documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as
amended, prior to the filing of a post-effective amendment which indicates that
all securities offered hereby have been sold or which deregisters all securities
then remaining unsold, are deemed to be incorporated by reference in this
Prospectus and shall be deemed to be a part hereof from the date of the filing
of such reports and documents.
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, a copy of any or all of the documents incorporated
by reference in the Registration Statement of which this Prospectus forms a part
(excluding exhibits to such documents unless specifically incorporated by
reference). Requests for such copies should be directed to Mr. Ben Sumner, Grill
Concepts, Inc., 11661 San Vicente Blvd., Suite 404, Los Angeles, California
90049, (310) 820-5559.
--------------------
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or any Selling Shareholder. This Prospectus does not constitute
an offer to sell, or a solicitation of an offer to buy, the securities offered
hereby to any person in any state or other jurisdiction in which such offer or
solicitation is unlawful. The delivery of this Prospectus at any time does not
imply that information contained herein is correct as of any time subsequent to
its date.
GENERAL INFORMATION
At April 30, 1996, the Company operated six Daily Grill restaurants in
Southern California, with two new Daily Grills under construction, and a third
scheduled to open during the fourth quarter of 1996 in Washington, D.C. The
Company also operates The Grill, a highly acclaimed, upscale restaurant in
Beverly Hills, which served as the original model for the Company's Daily Grill
restaurants. In addition to The Grill and the Daily Grill restaurants, the
Company operates three Pizzeria Uno restaurants in New Jersey and Pennsylvania
and owns a 51% interest in an entity which operates a Rhino Chasers brew pub in
terminal one of the Los Angeles International Airport.
The Company's executive offices are located at 11661 San Vicente Blvd.,
Suite 404, Los Angeles, California 90049, telephone number (310) 820-5559.
3
<PAGE>
USE OF PROCEEDS
The Company will receive the exercise price of the options when exercised
by the holders thereof. Such proceeds will be used for working capital purposes
by the Company. The Company will not, however, receive any of the proceeds from
the reoffer and resale of the Shares by the Selling Shareholders.
SELLING SHAREHOLDERS
This Prospectus relates to the reoffer and resale of the following Shares
which may be issued to the following affiliates of the Company (the "Selling
Shareholders") under the 1995 Plan:
<TABLE>
<CAPTION>
Number of Shares
Available to be Resold
Name Position Under the 1995 Plan
---- -------- -------------------
<S> <C> <C>
Robert Spivak President, Chief Executive Officer and Director 75,000
Robert Wechsler Chairman of the Board 35,000
Michael Weinstock Executive Vice President and Vice Chairman 97,500
Richard Shapiro Director 87,500
Charles Frank Director 25,000
Glenn Golenberg Director 25,000
Peter Balas Director 25,000
Ben Sumner Chief Financial Officer 50,000
John Sola Vice President - Executive Chef 25,000
Toni Hipp Vice President - Western Operations 25,000
</TABLE>
PLAN OF DISTRIBUTION
It is anticipated that all of the Shares will be offered by the Selling
Shareholders from time to time in the open market, either directly or through
brokers or agents, or in privately negotiated transactions. The Selling
Shareholders have advised the Company that they are not parties to any
agreements, arrangements or understandings as to such sales.
Any sales by the Selling Shareholders will be made subject to certain
volume limitations. During any three month period during which this Prospectus
is effective, each Selling Shareholder and affiliates may sell a maximum of the
greater of one percent of the outstanding Common Stock of the Company or the
average weekly trading volume of the Common Stock during the four calendar weeks
preceding the date of the sale.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the Shares offered
hereby have been passed upon for the Company by Vanderkam & Sanders, Houston,
Texas.
4
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission
(the "Commission") are incorporated by reference into this Registration
Statement and are made a part hereof:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1995.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the Annual
Report referred to in Item 3(a) above, including, but not limited to,
the Company's quarterly reports on Form 10-QSB for the fiscal quarter
ended March 31, 1996.
(c) The description of securities included in Form 8-A filed with the
Commission on March 21, 1994 (Commission File No. 0-23226).
All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment which indicates
that all securities offered hereby have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of the filing of such
reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Delaware Supreme Court has held that a director's duty of care to a
corporation and its stockholders requires the exercise of an informed business
judgment. Having become informed of all material information reasonably
available to them, directors must act with requisite care in the discharge of
their duties. However, the Company's Certificate of Incorporation provides, as
permitted under Delaware law, that no director shall be personally liable to the
Company or any of its stockholders for monetary damages for breach of fiduciary
duty as a director. This limitation will apply in all instances except for
liability imposed by statute: (i) for any breach of a director's duty of loyalty
to the Company or its stockholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or knowing violation of law or (iii)
pursuant to Section 174 of the Delaware General Corporation Law (which makes
directors personally liable for unlawful dividends or unlawful stock repurchases
or redemptions in certain circumstances). The limitation of liability provision
does not eliminate a stockholder's right to seek non-monetary, equitable
remedies such as injunction or rescission to redress an action taken by
directors. However, as a practical matter, equitable remedies may not be
available in all situations, and there may be instances in which no effective
remedy is available.
II-1
<PAGE>
In addition, the Company's Certificate of Incorporation and Bylaws provide
for the indemnification of the directors, officers, employees and agents of the
Company to the full extent permitted by Delaware law, in addition to various
procedures relating thereto. Under Delaware law, directors, officers, employees
and other individuals may be indemnified against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement in connection with
specified actions, suits or proceedings, whether civil, criminal, administrative
or investigative (other than a "derivative action" by or in the right of the
corporation) if they acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interests of the corporation and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe their conduct was unlawful. A similar standard of care is applicable in
the case of a derivative action, except that indemnification only extends to
expenses (including attorneys' fees) incurred in connection with the defense or
settlement of such an action and Delaware law requires court approval before
there can be any indemnification of expenses where the person seeking
indemnification has been found liable to the corporation. Delaware law further
provides that the indemnification and advancement of expenses provided by, or
granted pursuant to, provisions of Delaware law shall not be deemed exclusive of
any other rights to which those seeking indemnification or advancement of
expenses may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise. Because of the Company's substantial
presence in the State of California, it is anticipated that certain provisions
of California corporate law will become applicable to the Company commencing in
1997, in which case California's indemnification provisions will apply in lieu
of Delaware's. Such provisions are, however, substantially identical to
Delaware's.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
4.1 Grill Concepts, Inc. 1995 Stock Option Plan
5.1 Opinion and consent of Vanderkam & Sanders re: the legality of
the shares being registered
23.1 Consent of Vanderkam & Sanders (included in Exhibit 5.1)
23.2 Consent of Coopers & Lybrand L.L.P.
ITEM 9. UNDERTAKINGS
(a) The registrant hereby undertakes:
(1) To file, during any period in which offers or sells are being
made, a post-effective amendment to this registration statement
to include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
(2) That, for the purpose of determining liability under the
Securities Act of 1933, each post-effective amendment shall be
treated as a new registration statement of the securities
offered, and the offering of the securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To file a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that
is incorporated by reference in the 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
Securities Act of 1933 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 Securities and Exchange 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-2
<PAGE>
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 for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Los Angeles, State of California on the 17th day of
May, 1996.
GRILL CONCEPTS, INC.
By: /s/ ROBERT SPIVAK
ROBERT SPIVAK, President
Each of the undersigned officers and directors of Grill Concepts, Inc.
hereby constitutes and appoints Robert Spivak and Michael Weinstock, and each of
them singly, as true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission and to prepare any and all exhibits thereto,
and other documents in connection therewith, and to make any applicable state
securities law or blue sky filings, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done to enable Grill Concepts,
Inc. to comply with the provisions of the Securities Act of 1933, as amended,
and all requirements of the Securities and Exchange Commission, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in fact and agents, or their substitute or
substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signatures Title Date
---------- ----- ----
<S> <C> <C>
/s/ ROBERT SPIVAK President, Chief Executive Officer May 17, 1996
ROBERT SPIVAK and Director (Principal Executive Officer)
/s/ ROBERT WECHSLER Chairman of the Board May 17, 1996
ROBERT WECHSLER
/s/ BEN SUMNER Treasurer and Chief Financial Officer May 17, 1996
BEN SUMNER (Principal Financial and Accounting Officer)
/s/ MICHAEL WEINSTOCK Executive Vice President and Vice Chairman May 17, 1996
MICHAEL WEINSTOCK
/s/ CHARLES FRANK Director May 17, 1996
CHARLES FRANK
/s/ GLENN GOLENBERG Director May 17, 1996
GLENN GOLENBERG
PETER BALAS Director
</TABLE>
II-3
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page No.
- ----------- ----------- --------
4.1 Grill Concepts, Inc. 1995 Stock Option Plan.................. 12
5.1 Opinion and consent of Vanderkam & Sanders re: the legality
of the shares being registered........................... 21
23.1 Consent of Vanderkam & Sanders (included in Exhibit 5.1)
23.2 Consent of Coopers and Lybrand L.L.P......................... 22
<PAGE>
GRILL CONCEPTS, INC.
1995 STOCK OPTION PLAN
1. Purpose. The purpose of this Grill Concepts, Inc. 1995 Stock Option Plan
("Plan") is to encourage ownership of common stock, $.00001 par value ("Common
Stock"), of Grill Concepts, Inc., a Delaware corporation (the "Company"), by
eligible key employees, consultants and directors of the Company and its
Affiliates (as defined below) and to provide increased incentive for such
employees, consultants and directors to render services and to exert maximum
effort for the business success of the Company. In addition, the Company expects
that this Plan will further strengthen the identification of employees,
consultants and directors with the shareholders. Certain options to be granted
under this Plan are intended to qualify as Incentive Stock Options ("ISOs")
pursuant to Section 422 of the Internal Revenue Code of 1986, as amended
("Code"), while other options granted under this Plan will be nonqualified
options which are not intended to qualify as ISOs ("Nonqualified Options"),
either or both as provided in the agreements evidencing the options as provided
in Section 6 hereof. As used in this Plan, the term "Affiliates" means any
"parent corporation" of the Company and any "subsidiary corporation" of the
Company within the meaning of Sections 424(e) and (f), respectively, of the
Code.
2. Administration.
2.1 Composition of the Compensation Committee. This Plan shall be
administered by the Compensation Committee (the "Committee") designated by
the Board of Directors of the Company (the "Board"), which shall also
designate the Chairman of the Committee. If the Company is governed by Rule
16b-3 promulgated by the Securities and Exchange Commission ("Commission")
pursuant to the Securities Exchange Act of 1934, as amended ("Exchange
Act"), no director shall serve as a member of the Committee unless the
director is a "disinterested person" within the meaning of such Rule 16b-3.
Members of such Committee shall only be eligible to receive stock options
under this Plan pursuant to the following formula:
Each non-employee director shall automatically receive, on the date
that the person first becomes a non-employee director, an option with
respect to 25,000 shares. Thereafter, each person who is a
non-employee director on the day following any annual meeting of
shareholders of the Company shall automatically receive an option with
respect to 5,000 shares plus, for each committee on which such
non-employee director serves, an additional 1,000 shares. The exercise
price of all options granted pursuant to the foregoing formula shall
be set at the fair market value (as defined in Section 6(b) of this
Plan) of the underlying Common Stock on the date of grant. The
foregoing formula may be amended only to the extent such amendment is
not prohibited by Rule 16b-3.
<PAGE>
2.2 Committee Action. The Committee shall hold its meetings at such
times and places as it may be determine. A majority of its members shall
constitute a quorum, and all determinations of the Committee shall be made
by not less than a majority of its members. Any decision or determination
reduced to writing and signed by a majority of the members shall be fully
effective as if it had been made by a majority vote of its members at a
meeting duly called and held. The Committee may designate the Secretary of
the Company or other Company employees to assist the Committee in the
administration of this Plan, and may grant authority to such persons to
execute award agreements or other documents on behalf of the Committee and
the Company. Any duly constituted committee of the Board satisfying the
qualifications of this Section 2 may be appointed as the Committee.
2.3 Committee Expenses. All expenses and liabilities incurred by the
Committee in the administration of this Plan shall be borne by the Company.
The Committee may employ attorneys, consultants, accountants or other
persons.
3. Stock Reserved. Subject to adjustment as provided in Section 6.11
hereof, the aggregate number of shares of Common Stock that may be optioned
under this Plan is 1,500,000. The shares subject to this Plan shall consist of
authorized but unissued shares of Common Stock and such number of shares shall
be and is hereby reserved for sale for such purpose. Any of such shares which
may remain unsold and which are not subject to outstanding options at the
termination of this Plan shall cease to be reserved for the purpose of this
Plan, but until termination of this Plan or the termination of the last of the
options granted under this Plan, whichever last occurs, the Company shall at all
times reserve a sufficient number of shares to meet the requirements of this
Plan. Should any option expire or be canceled prior to its exercise in full, the
shares theretofore subject to such option may again be made subject to an option
under this Plan.
4. Eligibility. The persons eligible to participate in this Plan as a
recipient of options ("Optionee") shall include only key employees, consultants
and directors of the Company or its Affiliates at the time the option is
granted. An employee or consultant who has been granted an option hereunder may
be granted an additional option or options, if the Committee shall so determine.
5. Grant of Options.
5.1 Committee Discretion. The Committee shall have sole and absolute
discretionary authority (i) to determine, authorize, and designate those
key employees, consultants and directors of the Company or its Affiliates
who are to receive options under this Plan, (ii) to determine the number of
shares of Common Stock to be covered by such options and the terms thereof,
and (iii) to determine the type of option granted: ISOs, Nonqualified
Options or a combination of ISOs and Nonqualified Options; provided that
consultants and directors who are not employees of the Company may not
receive any ISOs. The Committee shall thereupon grant options in accordance
with such determination as evidenced by a written option agreement. Subject
to the express provisions of this Plan, the Committee shall have
discretionary authority to prescribe, amend and rescind rules and
regulations relating to this Plan, to interpret this Plan, to prescribe and
amend the terms of the option agreements (which need not be identical) and
to make all other determinations deemed necessary or advisable for the
administration of this Plan.
2
<PAGE>
5.2 Shareholder Approval. All options granted under this Plan are
subject to, and may not be exercised before, the approval of this Plan by
the shareholders prior to the first anniversary date of the Board meeting
held to approve this Plan, by the affirmative vote of the holders of a
majority of the outstanding shares of the Company present, or represented
by proxy, and entitled to vote thereat or written consent in accordance
with the laws of the State of Delaware; provided that if such approval by
the shareholders of the Company is not forthcoming, all options previously
granted under this Plan shall be void.
5.3 Limitation on Incentive Stock Options. The aggregate fair market
value (determined in accordance with Section 6(b) of this Plan at the time
the option is granted) of the Common Stock with respect to which ISOs may
be exercisable for the first time by any Optionee during any calendar year
under all such plans of the Company and its Affiliates shall not exceed
$100,000.
6. Terms and Conditions. Each option granted under this Plan shall be
evidenced by an agreement, in a form approved by the Committee, which shall be
subject to the following express terms and conditions and to such other terms
and conditions as the Committee may deem appropriate.
6.1 Option Period. The Committee shall promptly notify the Optionee of
the option grant and a written agreement shall promptly be executed and
delivered by and on behalf of the Company and the Optionee, provided that
the option grant shall expire if a written agreement is not signed by said
Optionee (or his agent or attorney) and returned to the Company within 60
days from date of receipt by the Optionee of such agreement. The date of
grant shall be the date the option is actually granted by the Committee,
even though the written agreement may be executed and delivered by the
Company and the Optionee after that date. Each option agreement shall
specify the period for which the option thereunder is granted (which in no
event shall exceed ten years from the date of grant in the case of an ISO)
and shall provide that the ISO shall expire at the end of such period. If
the original term of an option is less than ten years from the date of
grant, the option may be amended prior to its expiration, with the approval
of the Committee and the Optionee, to extend the term so that the term as
amended is not more than ten years from the date of grant. However, in the
case of an ISO granted to an individual who, at the time of grant, owns
stock possessing more than 10 percent of the total combined voting power of
all classes of stock of the Company or its Affiliate ("Ten Percent
Stockholder"), such period shall not exceed five years from the date of
grant.
6.2 Exercise Price. The exercise price of each share of Common Stock
subject to each option granted pursuant to this option is granted and, in
the case of ISOs, shall not be less than 100% of the fair market value of a
share of Common Stock on the date the option is granted, as determined by
the Committee. In the case of ISOs granted to a Ten Percent Stockholder,
the exercise price shall not be less than 110% of the fair market value of
a share of Common Stock on the date the option is granted. The exercise
price of each share of Common Stock subject to a Nonqualified Option under
this Plan shall be determined by the Committee prior to granting the
option. The Committee shall set the exercise price for each share subject
to a Nonqualified Option at such price as the Committee in its sole
discretion shall determine, provided that the exercise price of each share
of Common Stock subject to a Nonqualified Option shall not be less than
100% of the fair market value of a share of Common Stock on the date the
option is granted as determined by the Committee.
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For all purposes under this Plan, the fair market value of a share of
Common Stock on a particular date shall be equal to the mean of the
reported high and low sales prices of the Common Stock on the Nasdaq Stock
Market on that date, or if no prices are reported on that date, on the last
preceding date on which such prices of the Common Stock are so reported. If
the Common Stock is not traded on the Nasdaq Stock Market at the time a
determination of its fair market value is required to be made hereunder,
its fair market value shall be deemed to be equal to the average between
the closing bid and ask prices of the Common Stock on the most recent date
the Common Stock was publicly traded. In the event the Common Stock is not
publicly traded at the time a determination of its value is required to be
made hereunder, the determination of its fair market value shall be made by
the Committee in such manner as it deems appropriate.
6.3 Exercise Period. The Committee may provide in the option agreement
that an option may be exercised immediately or over the period of the grant
and in whole or in increments. However, no portion of any option may be
exercisable by an Optionee prior to the approval of this Plan by the
shareholders of the Company.
6.4 Procedure for Exercise. Options shall be exercised by the delivery
by the Optionee of written notice to the Secretary of the Company setting
forth the number of shares of Common Stock with respect to which the option
is being exercised. The notice shall be accompanied by, at the election of
the Optionee and as permitted by the Committee in the Agreement granting
such options, (i) cash, cashier's check, bank draft, or postal or express
money order payable to the order of the Company, (ii) certificates
representing shares of Common Stock theretofore owned by the Optionee duly
endorsed for transfer to the Company, (iii) an election by the Optionee to
have the Company withhold the number of shares of Common Stock the fair
market value, less the exercise price, of which is equal to the aggregate
exercise price of the shares of Common Stock issuable upon exercise of the
option, or (iv) any combination of the preceding, equal in value to the
full amount of the exercise price. Notice may also be delivered by telecopy
provided that the exercise price of such shares is received by the Company
via wire transfer on the same day the telecopy transmission is received by
the Company. The notice shall specify the address to which the certificates
for such shares are to be mailed. An option to purchase shares of Common
Stock in accordance with this Plan, shall be deemed to have been exercised
immediately prior to the close of business on the date (i) written notice
of such exercise and (ii) payment in full of the exercise price for the
number of share for which options are being exercised, are both received by
the Company and the Optionee shall be treated for all purposes as the
record holder of such shares of Common Stock as of such date.
As promptly as practicable after receipt of such written notice and
payment, the Company shall deliver to the Optionee certificates for the
number of shares with respect to which such option has been so exercised,
issued in the Optionee's name or such other name as Optionee directs;
provided, however, that such delivery shall be deemed effected for all
purposes when a stock transfer agent of the Company shall have deposited
such certificates in the United States mail, addressed to the Optionee at
the address specified pursuant to this Section 6.4.
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6.5 Termination of Employment. If an employee to whom an option is
granted ceases to be employed by the Company or its affiliates for any
reason other than death or disability or if a director or consultant to
whom an option is granted ceases to serve on the Board or as a consultant
for any reason other than death or disability, any option which is
exercisable on the date of such termination of employment or cessation of
serving on the Board or cessation of service as a consultant shall expire
three-months from the date of such termination or cessation but in no event
may the option be exercised after its expiration under the terms of the
option agreement.
6.6 Disability or Death. In the event the Optionee dies or is
determined under this Plan to be disabled while the Optionee is employed by
the Company or its Affiliates, acts as consultant or while serves on the
Board of the Company, the options previously granted to the Optionee may be
exercised (to the extent the Optionee would have been entitled to do so at
the date of death or the determination of disability) at any time and from
time to time, within a three-month period after such death or determination
of disability, by the Optionee, the guardian of the Optionee's estate, the
executor or administrator of the Optionee's estate or by the person or
persons to whom the Optionee's rights under the option shall pass by will
or the laws of descent and distribution, but in no event may the option be
exercised after its expiration under the terms of the option agreement. An
Optionee shall be deemed to be disabled if, in the opinion of a physician
selected by the Committee, the Optionee is incapable of performing services
for the Company of the kind the Optionee was performing at the time the
disability occurred by reason of any medically determinable physical or
mental impairment which can be expected to result in death or to be of
long, continued and indefinite duration. The date of determination of
disability for purposes hereof shall be the date of such determination by
such physician.
6.7 Transferability. An option granted pursuant to this Plan shall not
be assignable or otherwise transferable by the Optionee otherwise than by
Optionee's will or by the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined in the code or Title I of the
Employee Retirement Income Security Act, as amended, or the rules
thereunder. During the lifetime of an Optionee, an option shall be
exercisable only by such Optionee. Any heir or legatee of the Optionee
shall take rights granted herein and in the option agreement subject to the
terms and conditions hereof and thereof. No such transfer of any option to
heirs or legatees of the Optionee shall be effective to bind the Company
unless the Company shall have been furnished with written notice thereof
and a copy of such evidence as the Committee may deem necessary to
establish the validity of the transfer and the acceptance by the transferee
or transferees of the terms and conditions hereof.
6.8 Incentive Stock Options. Each option agreement may contain such
terms and provisions as the Committee may determine to be necessary or
desirable in order to qualify under the Code of option designated as an
incentive stock option.
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6.9 No Rights as Shareholder. No Optionee shall have any rights as a
shareholder with respect to shares covered by an option until the option is
exercised by written notice and accompanied by payment as provided in
Section 6.4 above.
6.10 Extraordinary Corporate Transactions. The existence of
outstanding options shall not affect in any way the right or power of the
Company or its shareholders to make or authorize any or all adjustments,
recapitalizations, reorganizations, exchanges, or other changes in the
Company's capital structure or its business, or any merger or consolidation
of the Company, or any issuance of Common Stock or other securities or
subscription rights thereto, or any issuance of bonds, debentures,
preferred or prior preference stock ahead of or affecting the Common Stock
or the rights thereof, or the dissolution or liquidation of the Company, or
any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character or
otherwise. If the Company recapitalizes or otherwise changes its capital
structure, or merges, consolidates, sells all of its assets or dissolves
(each of the forgoing a "Fundamental Change"), then thereafter upon any
exercise of an option theretofore granted the Optionee shall be entitled to
purchase under such option, in lieu of the number of shares of Common Stock
as to which option shall then be exercisable, the number and class of
shares of stock and securities to which the Optionee would have been
entitled pursuant to the terms of the Fundamental Change if, immediately
prior to such Fundamental Change, the Optionee had been the holder of
record of the number of shares of Common Stock as to which such option is
then exercisable. If (i) the Company shall not be the surviving entity in
any merger or consolidation (or survives only as a subsidiary of another
entity), (ii) the Company sells all or substantially all of its assets to
any other person or entity (other than a wholly-owned subsidiary), (iii)
any person or entity (including a "group" as contemplated by Section
13(d)(3) of the Exchange Act) acquires or gains ownership or control of
(including, without limitation, power to vote) more than 50% of the
outstanding shares of Common Stock, (iv) the Company is to be dissolved and
liquidated, or (v) as a result of or in connection with a contested
election of directors, the persons who were directors of the Company before
such election shall cease to constitute a majority of the Board (each such
event in clauses (i) through (v) above is referred to herein as a
"Corporate Change"), the committee, in its sole discretion, may accelerate
the time at which all or a portion of an Optionee's options may be
exercised for a limited period of time before or after a specified date.
6.11 Changes in Capital Structure. If the outstanding shares of Common
Stock or other securities of the Company, or both, for which the option is
then exercisable shall at any time be changed or exchanged by declaration
of a stock dividend, stock split, combination of shares or
recapitalization, the number and kind of shares of Common Stock or other
securities which are subject to this Plan or subject to any options
theretofore granted, and the exercise prices, shall be appropriately and
equitably adjusted so as to maintain the proportionate number of shares or
other securities without changing the aggregate exercise price.
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6.12 Acceleration of Options. Except as hereinbefore expressly
provided, (i) the issuance by the Company of shares of stock of any class
of securities convertible into shares of stock of any class, for cash,
property, labor or services, upon direct sale, upon the exercise of rights
or warrants to subscribe therefor, or upon conversion of shares or
obligations of the Company convertible into such shares or other
securities, (ii) the payment of a dividend in property other than Common
Stock, or (iii) the occurrence of any similar transaction, and in any case
whether or not for fair value, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of shares of
Common Stock subject to options thereto fore granted or the purchase price
per share, unless the Committee shall determine in its sole discretion that
an adjustment is necessary to provide equitable treatment to Optionee.
Notwithstanding anything to the contrary contained in this Plan, the
Committee may in its sole discretion accelerate the time at which any
option may be exercised, including, but not limited to, upon the occurrence
of the events specified in this Section 6.
7. Amendments or Termination. The Board may amend, alter or discontinue
this Plan, but no amendment or alteration shall be made which would impair the
rights of any Optionee, without his consent, under any option theretofore
granted, or which, without the approval of the shareholders, would: (i) except
as is provided in Section 6.11 of this Plan, increase the total number of shares
reserved for the purposes of this Plan, (ii) change the class of persons
eligible to participate in this Plan as provided in Section 4 of this Plan,
(iii) extend the applicable maximum option period provided for in Section 6.1 of
this Plan, (iv) extend the expiration date of this Plan set forth in Section 14
of this Plan, (v) except as provided in Section 6.11 of this Plan, decrease to
any extent the exercise price of any option granted under this Plan or (vi)
withdraw the administration of this Plan from the Committee.
8. Compliance With Other Laws and Regulations. This Plan, the grant and
exercise of options thereunder, and the obligation of the Company to sell and
deliver shares under such options, shall be subject to all applicable federal
and state laws, rules and regulations and to such approvals by any governmental
or regulatory agency as may be required. The Company shall not be required to
issue or deliver any certificates for shares of Common Stock prior to the
completion of any registration or qualification of such shares under any federal
or state law or issuance of any ruling or regulation of any government body
which the Company shall, in its sole discretion, determine to be necessary or
advisable. Any adjustments provided for in Sections 6.10, .11 and .12 of this
Plan shall be subject to any shareholder action required by Delaware corporate
law.
9. Purchase for Investment. Unless the options and shares of Common Stock
covered by this Plan have been registered under the Securities Act of 1933, as
amended, or the Company has determined that such registration is unnecessary,
each person exercising an option under this Plan may be required by the Company
to give a representation in writing that such person is acquiring such shares
for his or her own account for investment and not with a view to, or for sale in
connection with, the distribution of any part thereof.
10. Taxes.
10.1 The Company may make such provisions as it may deem appropriate
for the withholding of any taxes which it determines is required in
connection with any options granted under this Plan.
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10.2 Notwithstanding the terms of Section 10.1, each Optionee must pay
all taxes required to be withheld by the Company or paid by the Optionee in
connection with the exercise of a Nonqualified Option.
11. Replacement of Options. The Committee from time to time may permit an
Optionee under this Plan to surrender for cancellation any unexercised
outstanding option and receive from the Company in exchange an option for such
number of shares of Common Stock as may be designated by the Committee. The
Committee may, with the consent of the person entitled to exercise any
outstanding option, amend such option, including reducing the exercise price of
any option to not less than the fair market value of the Common Stock at the
time of the amendment and extending the term thereof.
12. No Right to Employment. Employees shall be considered to be in the
employment of the Company so long as they remain employees of the Company or its
Affiliates. Any questions as to whether and when there has been a termination of
such employment and the cause of such termination shall be determined by the
Committee, and its determination shall be final. Nothing contained herein shall
be construed as conferring upon the Optionee the right to continue in the employ
of the Company or its Affiliates, nor shall anything contained herein be
construed or interpreted to limit the "employment at will" relationship between
the Optionee and the Company or its Affiliates. The option agreements may
contain such provisions as the Committee may approve with reference to the
effect of approved leaves of absence.
13. Liability of Company for Non-Issuance of Shares and Tax Consequences.
The Company and any Affiliates which is in existence or hereafter comes into
existence shall not be liable to an Optionee or other persons as to:
13.1 The non-issuance or sale of shares as to which the Company has
been unable to obtain from any regulatory body having jurisdiction the
authority deemed by the Company's counsel to be necessary to the lawful
issuance and sale of any shares hereunder; and
13.2 Any tax consequence expected, but not realized, by any Optionee
or other person due to the exercise of any option granted hereunder.
14. Effectiveness and Expiration of Plan. This Plan shall be effective on
the date of adoption by the Board. If the shareholders of the Company fail to
approve this Plan within twelve months of the date of the Board adoption, this
Plan shall terminate and all options previously granted under this Plan shall
become void and of no effect. This Plan shall expire ten years after the date of
the Board adopts this Plan and thereafter no option shall be granted pursuant to
this Plan.
15. Non-Exclusivity of this Plan. Neither the adoption by the Board nor the
submission for approval of this Plan to the shareholders of the Company shall be
construed as creating any limitations on the power of the Board to adopt such
other incentive arrangements as it may deem desirable, including without
limitation, the granting of restricted stock or stock options otherwise than
under this Plan, and such arrangements may be either generally applicable or
applicable only in specific cases.
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16. Governing Law. This Plan and any agreements hereunder shall be
interpreted and construed in accordance with the laws of the State of Delaware
and applicable federal law.
17. Cashless Exercise. The Committee also may allow cashless exercises as
permitted under the Federal Reserve Board's Regulation T, subject to applicable
securities law restrictions, or by any other means which the Committee
determines to be consistent with this Plan's purpose and applicable law. The
proceeds from such a payment shall be added to the general funds of the Company
and shall be used for general corporate purposes.
IN WITNESS WHEREOF, and as conclusive evidence of the adoption of the
foregoing by directors of the Company, Grill Concepts, Inc. has caused these
presents to be duly executed in its name and behalf by its proper officers
thereunto duly authorized as of this _____ day of __________________, 1995.
GRILL CONCEPTS, INC.
ATTEST:
By:___________________________
________________________________ Name: Robert Spivak
Secretary Title: President
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May 16, 1996
Grill Concepts, Inc.
11661 San Vicente Blvd., Suite 404
Los Angeles, California 90049
Re: Form S-8 Registration Statement
Gentlemen:
You have requested that we furnish you our legal opinion with respect to
the legality of the following described securities of Grill Concepts, Inc. (the
"Company") covered by a Form S-8 Registration Statement, as amended through the
date hereof (the "Registration Statement"), filed with the Securities and
Exchange Commission for the purpose of registering such securities under the
Securities Act of 1933:
1. 1,500,000 shares of common stock, $.00001 par value (the
"Shares") issuable upon the exercise of various options, issued,
or to be issued, pursuant to the Company's 1995 Stock Option Plan
(the "Plan").
In connection with this opinion, we have examined the corporate records of
the Company, including the Company's Articles of Incorporation, Bylaws, and the
Minutes of its Board of Directors and Shareholders meetings, the Plan, the
Registration Statement, and such other documents and records as we deemed
relevant in order to render this opinion.
Based on the foregoing, it is our opinion that, after the Registration
Statement becomes effective and the Shares have been issued and delivered as
described therein, the Shares will be validly issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion with Securities and
Exchange Commission as an exhibit to the Registration Statement and further
consent to statements made therein regarding our firm and use of our name under
the heading "Legal Matters" in the Prospectus constituting a part of such
Registration Statement.
Sincerely,
VANDERKAM & SANDERS
/s/ VANDERKAM & SANDERS
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
Grill Concepts, Inc. on Form S-8 of our report dated March 15, 1996, on our
audits of the consoldated financial statements of Grill Concepts, Inc., as of
December 31, 1995 and December 25, 1994, and for the years then ended, which
report is included in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1995.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Certified Public Accountants
Los Angeles, California
May 17, 1996
