<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. N/A)
Shoney's, Inc.
-----------------------------------------
(Name of Issuer)
Common Stock
-----------------------------------------
(Title of Class of Securities)
829039100
-----------------------------------------
(CUSIP Number)
Courage Capital Management, LLC
ATTN: Donald M. Farris
4400 Harding Road
Nashville, TN 37205
(615) 298-7606
-----------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
July 6, 2000
-----------------------------------------
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), (f) or (g), check the following box. [ ]
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE> 2
CUSIP No. 829039100 13D Page 2 of 10 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Courage Capital Management, LLC ("Courage Capital")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
00
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Tennessee
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
2,851,875 shares of Common Stock (includes
1,526,148 shares issuable upon conversion of Liquid
SHARES Yield Option Notes due 2004 ("LYONS") and
763,327 shares issuable upon conversation of
Convertible Subordinated Debentures due 2002
BENEFICIALLY ("TPI Notes"))
-----------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
0 shares of Common Stock
EACH -----------------------------------------------------------
9 SOLE DISPOSITIVE POWER
REPORTING 2,851,875 shares of Common Stock (includes
1,526,148 shares issuable upon conversion of LYONS
and 763,327 shares issuable upon conversation
PERSON of TPI Notes)
-----------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
0 shares of Common Stock
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,851,875 shares of Common Stock, consisting of 0 shares of Common
Stock held directly, 1,941,803 shares held indirectly through V-One
Opportunity Fund, L.P., and 910,072 shares of Common Stock held
indirectly through Courage Special Situations Fund, LP
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
5.39% Common Stock
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
00
--------------------------------------------------------------------------------
2
<PAGE> 3
CUSIP No. 829039100 13D Page 3 of 10 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Richard C. Patton
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
00
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e)
[ ]
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
0 shares of Common Stock
SHARES ----------------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY 2,851,875 shares of Common Stock beneficially
owned by Courage Capital (includes 1,526,148 shares
issuable upon conversion of LYONS and 763,327 shares
OWNED BY issuable upon conversation of TPI Notes); Managing
Directors, Richard C. Patton and Donald M. Farris
share voting power.
EACH
----------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
PERSON ----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
WITH 2,851,875 shares of Common Stock beneficially owned
by Courage Capital (includes 1,526,148 shares
issuable upon conversion of LYONS and 763,327
shares issuable upon conversation of TPI
Notes); Managing Directors, Richard C. Patton
and Donald M. Farris share voting power.
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,851,875 shares of Common Stock held indirectly through Courage
Capital.
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
5.39% Common Stock
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
3
<PAGE> 4
CUSIP No. 829039100 13D Page 4 of 10 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Donald M. Farris
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
00
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e)
[ ]
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
0 shares of Common Stock
SHARES ---------------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY 2,851,875 shares of Common Stock beneficially
owned by Courage Capital (includes 1,526,148 shares
issuable upon conversion of LYONS and 763,327
OWNED BY shares issuable upon conversation of TPI Notes);
Managing Directors, Richard C. Patton and Donald
M. Farris share voting power.
EACH
---------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
---------------------------------------------------------
PERSON
10 SHARED DISPOSITIVE POWER
2,851,875 shares of Common Stock beneficially
WITH owned by Courage Capital (includes 1,526,148 shares
issuable upon conversion of LYONS and 763,327
shares issuable upon conversation of TPI
Notes); Managing Directors, Richard C. Patton
and Donald M. Farris share voting power.
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,851,875 shares of Common Stock held indirectly through Courage
Capital.
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
5.39% Common Stock
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
4
<PAGE> 5
CUSIP No. 829039100 13D Page 5 of 10 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NO. OF ABOVE PERSON
V-One Opportunity Fund, LP ("V-One")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e)
[ ]
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Tennessee
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
1,941,803 shares of Common Stock (includes
SHARES 1,379,403 shares issuable upon conversion of LYONs).
BENEFICIALLY ----------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
0 shares of Common Stock
EACH ----------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
1,941,803 shares of Common Stock (includes
PERSON 1,379,403 shares issuable upon conversion of LYONs).
WITH ----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0 shares of Common Stock
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,941,803 shares of Common Stock held directly.
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [X]
Excludes shares beneficially owned by its General Partner, Courage
Capital, through other funds.
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
3.73% Common Stock
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
PN
--------------------------------------------------------------------------------
5
<PAGE> 6
CUSIP No. 829039100 13D Page 6 of 10 Pages
--------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Courage Special Situations Fund, LP ("Courage Fund")
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e)
[ ]
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Tennessee
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
910,072 shares of Common Stock composed of
SHARES 146,745 shares issuable upon conversion of LYONS and
763,327 shares issuable upon conversion of TPI Notes.
BENEFICIALLY -----------------------------------------------------------
8 SHARED VOTING POWER
OWNED BY 0 shares of Common Stock
-----------------------------------------------------------
EACH
9 SOLE DISPOSITIVE POWER
910,072 shares of Common Stock composed of
REPORTING 146,745 shares issuable upon conversion of LYONS and
763,327 shares issuable upon conversion TPI Notes.
PERSON -----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
WITH 0 shares of Common Stock
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
910,072 shares of Common Stock held directly.
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [X]
Excludes shares beneficially owned by its General Partner, Courage
Capital, held in V-One
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.77% Common Stock
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
PN
--------------------------------------------------------------------------------
6
<PAGE> 7
ITEM 1. SECURITY AND ISSUER.
This Schedule 13D relates to the common stock, par value $1.00 share
(the "Common Stock") of Shoney's, Inc., a Tennessee corporation (the "Issuer").
The principal executive offices of the Issuer are located at 1727 Elm Hill Pike,
Nashville, TN 37210.
ITEM 2. IDENTITY AND BACKGROUND.
Courage Capital Management, LLC ("Courage Capital"):
(a) Courage Capital Management, LLC ("Courage Capital"), a
Tennessee limited liability company, is a private investment
firm with its principal office and place of business at 4400
Harding Road, Nashville, TN 37205. Courage Capital has not
been convicted in a criminal proceeding or been a party to a
civil proceeding described in Schedule 13D item 2(d) or (3).
Courage Capital's beneficial ownership of the Issuer's Common
Stock is controlled by its Managing Directors, Richard C.
Patton and Donald M. Farris. Its Members are Messrs. Patton
and Farris and Woodmont Capital LLC, none of which beneficially
owns shares of Common Stock of the Issuer except as set
forth herein.
Richard C. Patton:
(a) Richard C. Patton
(b) 4400 Harding Road, Nashville, TN 37205.
(c) Chief Manager, Courage Capital, 4400 Harding Road, Nashville,
TN 37205.
(d) During the last five years, Mr. Patton has not been convicted
in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) During the last five years, Mr. Patton has not been a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction where, as a result of such proceeding, he was subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, Federal or State securities laws or finding
any violation with respect to such laws.
(f) United States.
Donald M. Farris:
(a) Donald M. Farris
(b) 4400 Harding Road, Nashville, TN 37205.
(c) Managing Director, Courage Capital, 4400 Harding Road,
Nashville, TN 37205.
7
<PAGE> 8
(d) During the last five years, Mr. Farris has not been convicted
in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) During the last five years, Mr. Farris has not been a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction where, as a result of such proceeding, he was subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, Federal or State securities laws or finding
any violation with respect to such laws.
(f) United States.
Courage Special Situations Fund, LP:
Courage Special Situations Fund, LP ("Courage Fund"), a Tennessee
limited partnership, is a private investment firm with its principal office and
business located at 4400 Harding Road, Nashville, TN 37205. Its sole general
partner is Courage Capital. Courage Fund has not been convicted in a criminal
proceeding or been a party to a civil proceeding described in Schedule 13D Item
2(d) or (e).
V-One Opportunity Fund, L.P.:
V-One Opportunity Fund, LP ("V-One"), a Tennessee limited partnership,
is a private investment fund with its principal office and business located at
4400 Harding Road, Nashville, TN 37205. Its sole general partner is Courage
Capital. V-One has not been convicted in a criminal proceeding or been a party
to a civil proceeding described in Schedule 13D Item 2(d) or (e).
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On June 30 - July 11, 2000, V-One purchased 562,400 shares of common
stock of the Issuer in market transactions at prices ranging from $0.91 to $1.18
as set forth in Item 5(c), for a total consideration of $598,321. The source of
funds was the working capital of V-One.
ITEM 4. PURPOSE OF TRANSACTION.
Each of the parties described herein holds shares of Common Stock or
securities convertible into Common Stock described herein for investment
purposes. The parties intend to tender the LYONs and the TPIs in the Issuer's
proposed tender offer for such securities. In the ordinary course of business,
each of the parties described herein from time to time reviews the performance
of its investments and may acquire or dispose of shares of Common Stock at any
time.
Except as set forth above, none of the parties described herein
currently has plans or proposals with respect to any of the matters set forth in
paragraphs (a) through (j) of Item 4 of Schedule 13D. As part of the review of
investments in the Common Stock, each of the parties described herein may
explore from time to time a variety of alternatives, including, without
limitation, any of the matters set forth in paragraphs (a) through (j) of Item 4
of Schedule 13D. The decision to explore any of such alternatives would depend
on a variety of factors, including current and anticipated future trading prices
for the Common Stock, the
8
<PAGE> 9
financial condition, results of operations and prospects of the Issuer and
general economic, financial market and industry conditions.
ITEM 5. INTERESTS IN SECURITIES OF THE ISSUER.
Information required by Item 5 (a) and (b) is incorporated by reference
to items 7-11 and 13 from the cover pages hereto.
(c) On June 30, 2000, V-One purchased 225,000 shares of Common
Stock on the open market at a price of $1.18 per share.
On July 5, 2000, V-One purchased 200,000 shares of Common Stock
on the open market at a price of $0.96 per share.
On July 7, 2000, V-One purchased 37,400 shares of Common Stock
on the open market at a price of $0.91 per share.
On July 10, 2000, V-One purchased 50,000 shares of Common Stock
on the open market at a price of $1.04 per share.
On July 11, 2000, V-One purchased 50,000 shares of Common Stock
on the open market at a price of $1.04 per share.
(d) N/A
(e) N/A
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS, OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Courage Fund and V-One have executed agreements in the form of Exhibit
2 whereby their LYONs and TPIs are deposited with the Issuer and the Issuer has
an option to purchase those securities for $250.00 per $1,000 principal amount
at maturity of a LYON and $691.59 per principal amount of any TPI. The Issuer's
option becomes exercisable only if the Issuer's tender offer for such securities
expires or is terminated without the Issuer accepting tender and paying for the
securities.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1 Joint Filing Agreement of Courage Capital, Richard C.
Patton, Donald M. Farris, Courage Fund and V-One
Exhibit 2 Letter Agreement between the Issuer, Courage Fund and
V-One dated June 27, 2000
9
<PAGE> 10
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete, and
correct.
Courage Capital Management, LLC
Date: July 16, 2000 By: /s/ Richard C. Patton
-----------------------------------
Its: Chief Manager
-----------------------------------
