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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: January 15, 1998
CKE RESTAURANTS, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-13192 33--0602639
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
1200 North Harbor Boulevard, Anaheim, California 92801
(Address of principal executive offices)
(714) 774-5796
(Registrant's telephone number, including area code)
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Item 5. Other Events
On January 15, 1998, CKE Restaurants, Inc. ("CKE") announced that CKE
has entered into a Letter of Intent with Advantica Restaurant Group, Inc. and
Spartan Holdings, Inc. regarding a proposed transaction pursuant to which CKE
agreed to purchase from Spartan Holdings, Inc. all of the issued and outstanding
shares of common stock of Flagstar Enterprises, Inc. ("FEI"), an Alabama
corporation and its subsidiaries for a purchase price of approximately
$369,100,000 in cash and the assumption of $45.6 million in capital lease
liabilities plus up to $38.1 million in liabilities. Such purchase price is
subject to adjustment based on the net operating liabilities of FEI as of the
closing date.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99 Press Release - January 15, 1998 - CKE Restaurants
Announces Plans to Purchase Hardee's Franchises from
Advantica Restaurant Group.
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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.
CKE RESTAURANTS, INC.
Dated: January 27, 1998 /s/ CARL A. STRUNK
--------------------------------
Carl A. Strunk
Executive Vice President
Chief Financial Officer
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EXHIBIT INDEX
99 Press Release - January 15, 1998 - CKE Restaurants Announces
Plans to Purchase Hardee's Franchises from Advantica
Restaurant Group.
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NEWS RELEASE
FOR: CKE Restaurants, Inc.
CONTACT: Andrew F. Puzder
805.898.7134 [CKE RESTAURANTS LETTERHEAD]
Loren Pannier
714.778.7109
CKE RESTAURANTS ANNOUNCES PLANS TO PURCHASE HARDEE'S
FRANCHISES FROM ADVANTICA RESTAURANT GROUP
ANAHEIM, Calif. - January 15, 1998 - CKE Restaurants, Inc. (NYSE:CKR)
("CKE") parent of Hardee's Food Systems, Inc. ("Hardee's") announced today that
it has signed a letter of intent to purchase from Advantica Restaurant Group,
Inc. ("Advantica") its 557-unit Hardee's franchise subsidiary for approximately
$369 million in cash plus the assumption of certain liabilities. The parties
anticipate the transaction will close by the end of March.
CKE's Hardee's subsidiary currently owns and operates 867 Hardee's
restaurants and is the franchisor or licensor for 2,181 additional units.
Advantica currently is Hardee's largest franchisee. Following the closing,
Hardee's will own and operate 1,424 units and will be the franchisor or
licensor for 1,624 units.
Advantica's Hardee's subsidiary produced $603 million in revenues in
1996. Revenues for the first three quarters of 1997 were $417 million.
Additionally, as part of the transaction, Advantica, which was formerly known
as Flagstar Companies, Inc., will dismiss its pending arbitration claim against
Hardee's.
"This purchase, at an attractive price, is a significant step toward
balancing Hardee's franchise and company store system," said William P. Foley
II, CKE's chairman and chief executive officer. "It allows us to commit the
necessary resources and efforts to these units to support the growth and
development of our brand. In addition, the opportunity to improve operating
margins through the direct ownership of these restaurants will enhance CKE's
shareholder value."
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CKE Restaurants, Inc.
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Rory J. Murphy, Hardee's president and chief operating officer, said,
"This is a great strategic step for our brand. We will, in a single stroke,
significantly increase our revenues without comparably increasing our expenses
due to the obvious operating efficiencies and synergies inherent in absorbing
557 restaurants that are already Hardee's. We also believe that this purchase
will have a very positive impact on the franchise community as a whole by
eliminating a potentially contentious dispute and reemphasizing our commitment
to increase the profitability of the entire Hardee's system. I am extremely
excited by this purchase."
CKE Restaurants, Inc., through its subsidiaries and its franchisees and
licensees, operates 696 Carl's Jr. and 26 Rally's quick-service restaurants,
including 115 Carl's Jr./Green Burrito dual-brand locations, primarily located
in California, Nevada, Oregon, Arizona and Mexico; 3,048 Hardee's quick-service
restaurants in 39 states and 11 foreign countries including 79 Carl's
Jr./Hardee's dual-brand locations; 109 Taco Bueno quick-service restaurants, 95
JB's Restaurants, and six Galaxy Diner restaurants.
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