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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): May 5, 2000
SHONEY'S, INC.
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(Exact name of registrant as specified in its charter)
Tennessee 0-4377 62-0799798
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(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
1727 Elm Hill Pike, Nashville, TN 37210
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (615) 391-5201
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ITEM 5. OTHER EVENTS.
The Company has received a commitment letter from a major financial
institution for $120 million in additional senior secured financing. As
previously disclosed, the Company intends to raise a total of approximately
$250 million in new senior secured financing to invest in the Company's
"Shoney's" and "Captain D's" restaurant concepts. In connection with the new
financing, the Company is separating its operational and corporate structure
into three divisions - "Shoney's" restaurants, "Captain D's" restaurants and
Commissary Operations. Each of these divisions is expected to have its own
separate senior secured lending facility. The commitment letter described
herein is intended to relate to the Shoney's portion of the planned overall
financing arrangements.
The Shoney's commitment letter is subject to satisfaction of
customary conditions, including receipt of requisite third party consents and
absence of material adverse changes, and there can be no assurance that such
conditions will be satisfied. The commitment letter will expire on June 30,
2000, and the Company expects to complete its reorganization and related
refinancing program prior to that time, although the Company is not required
to do so.
Separately, the Company has been notified by the New York Stock
Exchange ("NYSE") that it has fallen below the NYSE's continued listing
criteria. As required by the notification, the Company is submitting to the
NYSE a business plan that sets forth definitive action that the Company
intends to take that would demonstrate progress toward meeting the NYSE's
listing criteria within 18 months. If the NYSE accepts the business plan,
the Company will be subject to quarterly monitoring for compliance with the
plan and the Company's stock would continue to trade on the NYSE; however,
failure by the Company to meet the plan could result in suspension from
trading, and subsequent delisting, of the Company's stock from the NYSE. If
the NYSE rejects the business plan, the Company's stock would be subject to
NYSE trading suspension and delisting by the Securities and Exchange
Commission.
Since last year when the Company received a similar notification from
the NYSE, the Company has investigated alternative trading venues for the
Company's securities. Although the Company's focus has been and will
continue to be on maintaining its NYSE listing, there is no assurance that
the NYSE will accept the Company's business plan. There also is no assurance
that the Company will be successful in its efforts to return to compliance
with the NYSE's continued listing standards or that, if it fails to do so,
its stock will continue to trade on the NYSE.
The Company has issued a press release in connection with the events
described in this Current Report on Form 8-K. A copy of the press release is
included herewith as Exhibit 99.1 and is incorporated herein by this
reference as if copied verbatim.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The following is filed as an exhibit to this Current Report on Form 8-K:
Exhibit No. Description
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99.1 Press release, dated May 5, 2000.
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.
SHONEY'S, INC.
Dated: May 5, 2000 By: /s/ V. Michael Payne
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V. Michael Payne
Senior Vice President and Controller,
Principal Financial and Chief
Accounting Officer
EXHIBIT INDEX
SEQUENTIAL
EXHIBIT NO. DESCRIPTION PAGE NUMBER
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99.1 Press release, dated May 5, 2000 5
Exhibit 99.1
FOR IMMEDIATE RELEASE Contact: SHONEY'S, INC.
V. Michael Payne
(615) 231-2332
SHONEY'S, INC. ANNOUNCES PROGRESS ON REORGANIZATION PROGRAM;
NOTIFIED REGARDING NYSE CONTINUED LISTING REQUIREMENTS
Nashville, TN, May 5, 2000 - Shoney's, Inc. today announced progress on
a major foundation of its previously announced reorganization with the
receipt of a commitment letter for $120 million in additional senior secured
financing.
As previously disclosed, the Company intends to raise a total of
approximately $250 million in new senior secured financing to invest in the
Company's "Shoney's" and "Captain D's" restaurant concepts. In connection
with the new financing, the Company is separating its operational and
corporate structure into three divisions - "Shoney's" restaurants, "Captain
D's" restaurants and Commissary Operations. Each of these divisions is
expected to have its own separate senior secured lending facility. The
commitment letter described in today's announcement relates to the Shoney's
portion of the planned overall financing arrangements.
The Shoney's commitment letter was issued by a major financial
institution. The commitment letter is subject to satisfaction of customary
conditions, including receipt of requisite third party consents and absence
of material adverse changes, and there can be no assurance that such
conditions will be satisfied. The commitment letter will expire on June 30,
2000, and the Company expects to complete its reorganization and related
refinancing program prior to that time, although the Company is not required
to do so.
Separately, officials of the Company announced today that it has
received notification from the New York Stock Exchange (the "NYSE") that it
has fallen below the NYSE's continued listing standards. The notification
stated that the Company is "below criteria" with respect to the NYSE's
requirements for total market capitalization (minimum of $50 million) and
stockholders' equity (minimum of $50 million).
As required by the notification, the Company is submitting to the NYSE
a business plan that sets forth definitive action that the Company intends to
take that would demonstrate progress toward meeting the NYSE's listing
criteria within 18 months. The NYSE will evaluate the plan upon receipt. If
the NYSE accepts the business plan, the Company will be subject to quarterly
monitoring for compliance with the plan and the Company's stock would
continue to trade on the NYSE; however, failure by the Company to meet the
plan could result in suspension from trading, and subsequent delisting, of
the Company's stock from the NYSE. If the NYSE rejects the business plan,
the Company's stock would be subject to NYSE trading suspension and delisting
by the Securities and Exchange Commission.
Since last year when the Company received a similar notification from
the NYSE, the Company has investigated alternative trading venues for the
Company's securities. Although the Company's focus has been and will
continue to be on maintaining its NYSE listing, there is no assurance that
the NYSE will accept the Company's business plan. There also is no assurance
that the Company will be successful in its efforts to return to compliance
with the NYSE's continued listing standards or that, if it fails to do so,
its stock will continue to trade on the
NYSE. If the Company determines that its stock no longer will trade on the
NYSE, an appropriate announcement will be made so advising security holders.
As of February 20, 2000, Shoney's, Inc. operated and franchised a chain
of 1,102 restaurants in 28 states, including 641 Company-owned and 461
franchised restaurants. The Company's common stock is traded on the NYSE
under the symbol "SHN."
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CERTAIN STATEMENTS IN THIS RELEASE ARE "FORWARD-LOOKING STATEMENTS"
WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
ALL FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES WHICH, IN MANY
CASES, ARE BEYOND THE CONTROL OF THE COMPANY AND COULD CAUSE ACTUAL RESULTS
TO DIFFER MATERIALLY. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE ANY
FORWARD-LOOKING STATEMENTS, OR TO MAKE ANY OTHER FORWARD LOOKING STATEMENTS,
WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. FURTHER
INFORMATION ON FACTORS WHICH COULD AFFECT THE COMPANY'S FINANCIAL RESULTS IS
CONTAINED IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE
COMMISSION, INCLUDING THE ABILITY OF MANAGEMENT TO IMPLEMENT SUCCESSFULLY ITS
STRATEGY FOR IMPROVING SHONEY'S RESTAURANTS PERFORMANCE, THE ABILITY TO
EFFECT PROPOSED FINANCINGS UPON TERMS THAT ARE SATISFACTORY TO THE COMPANY,
THE ABILITY TO EFFECT ASSET SALES CONSISTENT WITH THE PROJECTED PROCEEDS AND
TIMING EXPECTATIONS, THE RESULTS OF PENDING LITIGATION, ADEQUACY OF
MANAGEMENT PERSONNEL RESOURCES, SHORTAGES OF RESTAURANT LABOR, COMMODITY
PRICE INCREASES, PRODUCT SHORTAGES, ADVERSE GENERAL ECONOMIC CONDITIONS,
TURNOVER AND A VARIETY OF OTHER FACTORS.
