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SOLICITING MATERIAL
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 7, 1997
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
[AMENDMENT NO...................]
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
SHONEY'S, INC.
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(Name of Registrant as Specified in Its Charter)
RAYMOND D. SCHOENBAUM and BETTY J. SCHOENBAUM
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
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CONTACT:
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FOR INVESTORS: FOR MEDIA:
Stanley J. Kay, Jr. Joele Frank/Matthew Sherman
MacKenzie Partners, Inc. Abernathy MacGregor Group
(212) 929-5940 (212) 371-5999
FOR IMMEDIATE RELEASE:
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THE SHONEY'S SHAREHOLDERS' COMMITTEE
MAILS AGENT DESIGNATION MATERIALS TO SHONEY'S SHAREHOLDERS
SHAREHOLDERS URGED TO SUBMIT BLUE AGENT DESIGNATION CARDS BY JULY 14
TO CALL AND DEMAND A SPECIAL MEETING OF SHONEY'S SHAREHOLDERS
ATLANTA, GEORGIA (JuLY 7, 1997) -- The Shoney's Shareholders' Committee
announced today that it filed definitive materials with the Securities and
Exchange Commission (SEC) in Washington, D.C., on Thursday, July 3, 1997 with
respect to its solicitation of Agent Designation cards to call for and demand a
Special Meeting of Shoney's Shareholders. The Committee strongly urges all
shareholders of Shoney's, Inc. [NYSE:SHN] as soon as possible and in any event
by July 14, to submit their BLUE Agent Designation cards calling for and
demanding a Special Meeting. At the Special Meeting, if called, shareholders of
Shoney's would consider and vote upon certain proposals, including proposals to
remove the Company's current Board of Directors and replace them with the
Committee's slate of nominees.
Raymond D. Schoenbaum, on behalf of the Shoney's Shareholders' Committee,
said, "Shoney's shareholders deserve the opportunity to decide the future
direction of the Company and with the mailing of our definitive materials, we
are one step closer toward realizing that goal. We strongly urge all
shareholders to send in their BLUE Agent Designation cards -- by July 14 -- to
send a clear message to Shoney's current Board and management that shareholders
are dissatisfied with Shoney's performance and want the opportunity to elect the
Board of Directors that will guide our Company in the future. If we are
successful in electing our nominees to the Board, we intend to keep Shoney's in
Nashville and work together from this home-base with Shoney's shareholders,
employees and franchisees to restore the quality of Shoney's restaurants and the
business and reputation of Shoney's.
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"Shoney's stock has lost approximately 80% of its value from October
1993 to April 25, 1997 (the date on which we filed a Schedule 13D indicating our
disappointment with the Company's performance). During this same period, the S&P
500 and the S&P Restaurants Index respectively increased 63.6% and 66.8%. Under
Stephen Lynn's leadership, Shoney's share value has continued to decline, and we
believe that Shoney's current management does not have a workable plan to
address the Company's problems. Our action plan, the basic elements of which are
described in the solicitation materials, is designed to revitalize Shoney's by
focusing on operating, marketing and financial solutions to Shoney's problems.
The same-store sales declines suffered by Shoney's have been especially
disturbing. A key element of our plan is to bring Shoney's customers back home
by focusing the corporate culture back on the customer and enhancing the quality
of the food."
Mr. Schoenbaum also commented on the Bylaw amendments adopted by the
current Shoney's Board after the Committee commenced its efforts to call and
demand a special meeting to remove and replace the Board, stating, "All we want
is a full and fair opportunity to present our case directly to Shoney's
shareholders in a timely fashion. If Chairman Lynn and his Board are sincerely
interested in the welfare of Shoney's shareholders, we urge them to stop setting
up roadblocks and bringing wasteful litigation designed to prevent the true
owners of the Company -- the shareholders -- from exercising their right on a
timely basis to determine the future of Shoney's. It is critical that Shoney's
problems be addressed now before it is too late."
In order to call and demand a Special Meeting of Shoney's Shareholders,
the Committee needs to obtain BLUE Agent Designation cards from shareholders of
Shoney's representing 10% or more of Shoney's outstanding shares, including
approximately 8.0% of Shoney's outstanding common stock currently owned by the
Shoney's Shareholders' Committee.
Raymond D. Schoenbaum has been actively involved in the restaurant
industry since 1974, and he has extensive experience in the business, including
substantial experience in the full service dining industry and in the quality
fast food market. From 1974 to 1985, Raymond D. Schoenbaum successfully grew a
Wendy's franchisee (Restaurants Systems, Inc.) to in excess of 30 stores which
he sold to Wendy's in 1985 for approximately $40 million. Between 1985 and 1995
he developed and operated Ray's on the River and Rio Bravo, a successful chain
of casual restaurants. In 1995, Raymond D. Schoenbaum sold Ray's on the River
and Rio Bravo to Applebee's International Inc. for approximately $70 million,
and became a director of Applebee's following the sale. In addition, Raymond D.
Schoenbaum has been involved with the turnaround of companies in the restaurant
and restaurant services industries, including Squirrel Companies, Inc., a
manufacturer of restaurant point-of-source computer equipment, as the former
chairman of the board, and Max & Erma's Restaurants, Inc., as a former member of
the board and largest shareholder.
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# # #
INFORMATION REGARDING PARTICIPANTS
AND CERTAIN OTHER PERSONS
Raymond D. Schoenbaum has his principal business address at 1640 Powers Ferry
Road, Building Two, Suite 100, Marietta, Georgia 30067. Betty J. Schoenbaum
has her principal residential address at 5541 Gulf of Mexico Drive, Longboat
Key, Florida 34228. Raymond D. Schoenbaum is a private investor. Betty J.
Schoenbaum is not employed. As of the date hereof, Raymond D. Schoenbaum is
deemed to own beneficially (as that term is defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) 508,061 shares
of Common Stock of Shoney's, which constitutes approximately 1.0% of the
outstanding shares of Common Stock (based on information provided by Shoney's in
its quarterly report on Form 10-Q for the quarter ended May 11, 1997). As of the
date hereof, Betty J. Schoenbaum is deemed to own beneficially 3,394,480 shares
of Common Stock of Shoney's, which constitutes approximately 7.0% of the
outstanding shares of Common Stock (based on information provided by Shoney's in
its quarterly report on Form 10-Q for the quarter ended May 11, 1997). As of the
date hereof, Raymond D. Schoenbaum and Betty J. Schoenbaum are deemed to own
beneficially 3,866,791 shares of Common Stock of Shoney's, which constitutes
approximately 8.0% of the outstanding shares of Common Stock (based on
information provided by Shoney's in its quarterly report on Form 10-Q for the
quarter ended May 11, 1997).
In connection with Montgomery Securities' engagement as financial advisor to the
Shoney's Shareholders' Committee, the Committee anticipates that certain
employees of Montgomery Securities may communicate in person, by telephone or
otherwise with a limited number of institutions, brokers or other persons who
are shareholders for the purpose of assisting in the solicitation. Montgomery
Securities will not receive any fee for, or in connection with, such
solicitation activities apart from the fees they are otherwise entitled to
receive under their engagement. The principal business address of Montgomery
Securities is 600 Montgomery Street, San Francisco, California 94111. In the
ordinary course of its business, Montgomery Securities maintains customary
arrangements and may effect transactions in the securities of the Company for
the accounts of its customers. As a result of its engagement by the Shoney's
Shareholders' Committee, Montgomery Securities restricted its proprietary
trading in the securities of Shoney's as of June 16, 1997 (although it may still
execute trades for customers on an unsolicited agency basis). As of June 12,
1997, Montgomery Securities did not beneficially own any Common Stock of
Shoney's, and held of record 10,312 shares of Common Stock for customer
accounts.
In addition, Howard E. Sachs, John S. Ellis and W. Douglas Benn, advisors to
Raymond D. Schoenbaum, may assist in soliciting Agent Designations, although
none of them nor the Shoney's Shareholders' Committee admits that any of them is
a "participant", as defined in Schedule 14A promulgated by the Securities and
Exchange Commission under the Exchange Act. Mr. Sachs has his principal
business address at 1901 Powers Ferry Road, Suite 260, Atlanta, Georgia 30339.
As of the date hereof, Mr. Sachs was the beneficial owner of 5,250 shares of
Common Stock of Shoney's. Mr. Ellis has his principal business address at 1640
Powers Ferry Road, Building Two, Suite 100, Marietta, Georgia 30067. As of the
date hereof, Mr. Ellis did not own beneficially or of record any shares of
Common Stock. Mr. Benn has his principal business address at 1640 Powers Ferry
Road, Building Two, Suite 100, Marietta, Georgia 30067. As of the date hereof,
Mr. Benn did not own beneficially or of record any shares of Common Stock.
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