<PAGE> 1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
or
[ ] Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended October 6, 1996 Commission file number 0-7961
TPI ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)
NEW JERSEY 22-1899681
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P.O. BOX 382460
GERMANTOWN, TENNESSEE 38138-2460
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (901) 752-3889
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Shares, Par Value $.01 per Share
---------------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for he past 90 days.
Yes X No
--- ---
The number of shares outstanding of the registrant's common stock is
20,664,512 as of November 15, 1996.
================================================================================
<PAGE> 2
PART I - FINANCIAL INFORMATION
Companies for which information is furnished:
TPI Enterprises, Inc.
Telecom Plus Shared Tenants Services, Inc.
Maxcell Telecom Plus, Inc.
TPI Restaurants, Inc.(1)
Insurex Agency, Inc. (1)(2)
Insurex Benefit Administrators, Inc. (1)(2)
TPI Entertainment, Inc. (1)
TPI West Palm, Inc. (1)
TPI Commissary, Inc.(1) (2)
TPI Transportation, Inc.(1) (2)
TPI Insurance Corporation (1)
(1) Subsidiaries were sold to Shoney's Inc. in a transaction consummated on
September 9, 1996. See Note 2 to Notes to Consolidated Financial
Statements.
(2) Wholly-owned subsidiaries of TPI Restaurants, Inc.
<PAGE> 3
ITEM 1. FINANCIAL STATEMENTS
TPI ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF NET ASSETS IN LIQUIDATION
(LIQUIDATION BASIS)
<TABLE>
<CAPTION>
October 6,
1996
(Dollars in Thousands)
ASSETS
<S> <C>
Cash and cash equivalents $ 2,101
Investments 5,000
--------
Total Assets 7,101
LIABILITIES
Reserve for estimated costs during the period of liquidation 1,230
Accrued expenses 983
Accrued costs of litigation settlement 250
--------
Total liabilities 2,463
--------
NET ASSETS IN LIQUIDATION $ 4,638
========
See notes to consolidated financial statements.
</TABLE>
3
<PAGE> 4
TPI ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1995
(GOING CONCERN BASIS)
<TABLE>
<CAPTION>
December 31,
1995
(Dollars in Thousands)
ASSETS
<S> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 8,744
Accounts receivable-trade (net of allowance for doubtful accounts of $125 in 1995) 1,248
Litigation settlement receivable 30,000
Inventories 13,020
Deferred tax benefit 5,728
Other current assets 3,237
-----------
Total current assets 61,977
PROPERTY AND EQUIPMENT (AT COST) 236,969
Less accumulated depreciation and amortization 79,637
Less allowance for restructuring 8,752
-----------
property and equipment, net 148,580
OTHER ASSETS:
Goodwill (net of accumulated amortization of $9,431 in 1995) 36,396
Less valuation allowance 17,000
-----------
Total other assets 19,396
OTHER INTANGIBLE ASSETS (NET OF ACCUMULATED DEPRECIATION OF $6,504 IN 1995) 18,298
OTHER 625
-----------
TOTAL ASSETS $ 248,876
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Current liabilities:
Current portion of long-term debt $ 24,231
Accounts payable-trade 16,052
Accrued expenses and other current liabilities 30,604
Accrued costs of litigation settlement 13,537
Income taxes currently payable 618
-----------
Total current liabilities 85,042
Long-term debt 81,628
Reserve for restructuring 8,162
Deferred income taxes 5,537
Other liabilities 1,641
-----------
Total liabilities 182,010
</TABLE>
4
<PAGE> 5
TPI ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1995 (CONTINUED)
(GOING CONCERN BASIS)
<TABLE>
<CAPTION>
DECEMBER 31,
1995
(DOLLARS IN THOUSANDS)
SHAREHOLDERS' EQUITY:
<S> <C>
Preferred shares - no par value 20,000,000 shares authorized; none issued
and outstanding
Common shares - $.01 par value - 100,000,000 shares authorized;
issued - 33,402,553 shares in 1995 $ 334
Additional paid-in capital 226,454
Deficit (90,157)
----------
Total 136,631
Less treasury stock, at cost, 12,805,266 common shares 69,765
----------
Total shareholders' equity 66,866
----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 248,876
==========
</TABLE>
See notes to consolidated financial statements.
5
<PAGE> 6
TPI ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND CHANGES IN NET ASSETS IN
LIQUIDATION
<TABLE>
<CAPTION>
(Dollars in Thousands)
--------------------------------------------------------------------------
Twelve Weeks Ended Forty Weeks Ended
------------------------------------ ------------------------------------
October 6, October 1, October 6, October 1,
1996 1995 1996 1995
(Liquidation (Going Concern (Liquidation (Going Concern
Basis) Basis) Basis) Basis)
<S> <C> <C> <C> <C>
RESTAURANT REVENUES $ 43,929 $ 65,492 $ 195,219 $ 216,477
COSTS AND EXPENSES:
Food, supplies, and uniforms 15,867 23,933 71,020 78,656
Restaurant labor and benefits 13,120 21,256 61,761 67,589
Restaurant depreciation and amortization 1,775 2,553 8,076 9,472
Other restaurant operating expenses 9,822 13,866 38,851 41,474
General and administrative expenses 4,768 5,516 16,464 17,193
Provision for asset valuation (17,000)
Closed unit reserve 152 4,809
Restructuring 101 (3,049) (69) (3,049)
Other (25) 3 7,088 576
---------- ---------- ---------- ----------
Total costs and expenses 45,580 64,078 191,000 211,911
---------- ---------- ---------- ----------
OPERATING INCOME (1,651) 1,414 4,219 4,566
OTHER INCOME AND EXPENSES:
Interest income (154) (38) (661) (212)
Interest expense 1,645 2,399 7,596 7,989
Gain on Sale (7,124) (7,124)
---------- ----------- ---------- -----------
Total other income and expenses (5,633) 2,361 (189) 7,777
---------- ---------- ---------- ----------
INCOME (LOSS) BEFORE PROVISION
FOR INCOME TAXES 3,982 (947) 4,408 (3,211)
PROVISION FOR INCOME TAXES - - - -
----------- ----------- ----------- -----------
NET INCOME (LOSS) 3,982 $ (947) 4,408 $ (3,211)
========== ==========
Net loss per common share $ (0.05) $ (0.16)
========== ==========
Weighted average number of common
and common equivalent shares outstanding 20,467 20,436
========== ==========
NET ASSETS, BEGINNING OF PERIOD (1) 67,401 66,866
ADJUSTMENT TO LIQUIDATION BASIS (1,250) (1,250)
OTHER 66 175
CHANGES IN NET ASSETS IN LIQUIDATION
ATTRIBUTED TO DISTRIBUTION OF
SHONEY'S, INC. STOCK TO SHAREHOLDERS
OF RECORD (65,561) (65,561)
---------- ----------
NET ASSETS, END OF PERIOD $ 4,638 $ 4,638
========== ==========
</TABLE>
(1) Net assets, beginning of period represent net equity as of July 14, 1996
and December 31, 1995, respectively.
See notes to consolidated financial statements.
6
<PAGE> 7
TPI ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
(Dollars in Thousands)
------------------------------
Forty Weeks Ended
October 1,
1995
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C>
Net loss $ (3,211)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 13,392
Gain on disposal of property and equipment (314)
Changes in assets and liabilities:
Accounts receivable-trade (396)
Inventories (689)
Other current assets (612)
Other assets (620)
Accounts payable-trade (825)
Accrued expenses and other current liabilities 2,854
Income taxes currently payable (73)
Reserve for restructuring (6,779)
Other liabilities (401)
-----------
Net cash provided by operating activities 2,326
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment (5,729)
Disposition of property and equipment 2,222
-----------
Net cash used in investing activities (3,507)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net payments on credit facilities (8,600)
Other long-term debt payments (1,551)
Common shares issued 250
-----------
Net cash used in financing activities (9,901)
-----------
NET DECREASE IN CASH AND CASH EQUIVALENTS (11,082)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 17,228
-----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 6,146
===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Non-cash transactions:
Capitalized lease obligations entered into $ 365
Cash payments (refunds) during the quarter for:
Interest 7,818
Income taxes refunded (80)
Income taxes paid 172
</TABLE>
See notes to consolidated financial statements.
7
<PAGE> 8
TPI ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION - Pursuant to the terms of the Plan of Tax-Free
Reorganization under Section 368(a)(1)(c) of the Internal Revenue Code and
Agreement, dated March 15, 1996, as amended, by and among TPI Enterprises,
Inc. (the "Company"), Shoney's, Inc. ("Shoney's") and TPI Restaurants
Acquisition Corporation, a wholly-owned subsidiary of Shoney's (the
"Agreement"), the Company completed the sale of substantially all of the
Company's assets to Shoney's (the "Transaction") on September 9, 1996. In
connection with the Transaction, the Company's Board of Directors approved
a Plan of Complete Liquidation as required by the Agreement. Under the
Plan of Complete Liquidation, the Company is required to wind-down its
operations and distribute its assets after paying or making provision for
its liabilities. On October 1, 1996, the Company distributed 6,785,114
shares of Shoney's common stock, $1.00 par value ("Shoney's Common Stock"),
representing the total number of shares of Shoney's Common Stock received
pursuant to the Transaction, to its shareholders of record as of September
24, 1996.
As a result of the Transaction, the Company adopted the liquidation basis
of accounting for all periods subsequent to September 9, 1996. Under the
liquidation basis of accounting, assets are stated at their estimated
realizable value and liabilities, including a provision for the estimated
costs of liquidation, are stated at their anticipated settlement amounts.
The valuations of assets and liabilities are based on management estimates
and assumptions as of the date of the financial statements; actual
realization of assets and settlement of liabilities could be higher or
lower than amounts indicated.
CONSOLIDATION - The consolidated statement of net assets in liquidation as
of October 6, 1996, the consolidated statements of loss and changes in net
assets for the periods ended October 6, 1996 and October 1, 1995, and the
consolidated statement of cash flows for the period ended October 1, 1995
have been prepared by the Company without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the consolidated financial
position at October 6, 1996, the consolidated results of operations for the
periods ended September 8, 1996 and October 1, 1995, the consolidated
change in net assets in liquidation for the period ended October 6, 1996,
and the consolidated statement of cash flows for the period ended October
1, 1995, have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. These financial statements
should be read in conjunction with the audited financial statements of the
Company included in its Annual Report on Form 10-K for the year ended
December 31, 1995.
NET INCOME (LOSS) PER COMMON SHARE - As explained above in "Basis of
Presentation", effective September 9, 1996, the Company adopted the
liquidation basis of accounting, which reports an excess of assets over
liabilities. Accordingly, the presentation of per common share information
on a liquidation basis is not considered meaningful and has been omitted.
8
<PAGE> 9
Income (loss) per common share data for the twelve and forty weeks ended
October 1, 1995 have been computed as those periods are reported on the
going concern basis of accounting. As the Company's options, warrants, and
convertible debentures have an antidilutive effect during these periods,
earnings per share amounts are computed by dividing net income by the
weighted average number of common shares outstanding during the periods.
INVESTMENT - The Company's $5,000,000 investment at October 6, 1996
represents U.S. Treasury bills due December 12, 1996. At October 6, 1996,
cost approximates net realizable value.
2. SHONEY'S, INC. TRANSACTION
GENERAL - On September 9, 1996, the Company consummated the sale of
substantially all of its assets to Shoney's pursuant to the terms of the
Agreement.
CONSIDERATION - In exchange for substantially all of the assets of the
Company, including the shares of capital stock of TPI Restaurants, Inc.
("TPIR"), TPI Entertainment, Inc., and TPI Insurance Corporation, at the
closing of the Transaction (the "Closing"), the Company received from
Shoney's an aggregate of 6,785,114 shares of Shoney's Common Stock and was
permitted to retain approximately $4,650,000 in cash, plus certain
additional cash to pay the Company's remaining Specified Wind-up Expenses
(as defined in the Agreement). As noted under the caption "Initial
Distribution" below, on October 1, 1996, the 6,785,114 shares of Shoney's
Common Stock were distributed to the Company's shareholders of record as of
September 24, 1996.
The Agreement entitled the Company to retain up to $7,500,000 in cash
("Retained Cash") and up to $7,350,000 to pay Specified Wind-up Expenses,
in each case subject to certain adjustments. Approximately $1,150,000 in
Retained Cash was exchanged for additional shares of Shoney's Common Stock
pursuant to the Agreement, thereby reducing the amount of Retained Cash to
approximately $6,350,000. Specified Wind-up Expenses are currently
estimated to be approximately $1,700,000 in excess of the $7,350,000
allotment. Such excess included a payment of approximately $1,300,000 to
Shoney's at the Closing in settlement of certain liabilities or contingent
liabilities which exceeded the liabilities agreed to be retained by
Shoney's in the Agreement. The $1,300,000 payment included approximately
$550,000 for Excess Repair and Maintenance Expenses (as defined in the
Agreement). As a result, Retained Cash is approximately $4,650,000, or
$0.205 per share of the Company's Common Stock.
The $4,650,000 in Retained Cash assumes that no liabilities of the
Company, other than those presently known, arise prior to its dissolution.
Of the $4,650,000 in Retained Cash, a maximum of approximately $400,000
will be required to be retained by the Company for the benefit of holders
of the stock options of the Company which were assumed by Shoney's in the
Transaction ("Shoney's Options"), until such time as such options are
exercised, are terminated, or expire. Under the Company's Plan of Complete
Liquidation, if Shoney's Options are not exercised prior to the final
liquidating distribution record date, such cash, after providing for the
expenses of the distribution thereof, will be distributed to the Company's
shareholders. The final liquidating distribution record date will occur no
earlier than December 31, 1998.
9
<PAGE> 10
INITIAL DISTRIBUTION - On October 1, 1996, the Board of Directors of the
Company (the "Company's Board") made an initial distribution to its
shareholders of all of the shares of Shoney's Common Stock received by the
Company in the Transaction (the "Initial Distribution") to holders of
record of the Company's Common Stock on September 24, 1996.
RESIGNATION OF OFFICERS AND BOARD MEMBERS - Effective as of September 9,
1996, all of the officers of the Company resigned, except for Frederick W.
Burford, who was elected as the Company's President, Chief Financial
Officer and Secretary, and Paul J. Siu, who was elected as Assistant
Secretary. Effective as of October 10, 1996, all of the members of the
Company's Board resigned, except for Mr. Burford and Mr. Siu.
PLAN OF DISSOLUTION - The Company's Board intends to dissolve the Company's
in accordance with the provisions of the New Jersey Business Corporation
Act (the "NJBCA") by obtaining tax clearance and by causing a certificate
of dissolution to be filed in the office of the Secretary of State of the
State of New Jersey. The application for tax clearance was filed on
October 20, 1996. It is currently anticipated that this process will be
completed by the end of 1996, although there can be no assurance that the
State of New Jersey will not take longer to dissolve the Company.
SUBSEQUENT DISTRIBUTIONS - Pursuant to the NJBCA, promptly after the Company
has been dissolved, it will give notice requiring all creditors of the
Company to present their claims in writing. Such notice will also be
published in newspapers of general circulation as provided in the NJBCA.
This notice is required by the NJBCA to be published three times, once a
week for three consecutive weeks, in a newspaper of general circulation in
the county in which the registered office of the corporation is located and
shall state that all persons who are creditors of the corporation shall
present written proof of their claims to the corporation at a place and on
or before a date named in the notice, which date shall not be less than six
months after the date of the first publication. On or before the date of
the first publication of the notice, the corporation shall mail a copy of
the notice to each known creditor of the corporation. Generally, any
creditor who does not file a claim as provided in the notice, and all those
claiming through and under such creditor, would be forever barred from
suing on such claim or otherwise realizing upon or enforcing it.
The Company's Board does not currently intend to make any cash
distributions to its shareholders until such time as the period for
creditors of the Company to present written proof of their claims shall
have expired. At such time, the Company's Board intends to review the
assets and liabilities of the Company and consider the effect of all then
known or anticipated liabilities and, after paying or making provision for
all then known or anticipated liabilities, it intends to declare a
distribution consisting of all of the then remaining cash other than the
cash required to be retained for holders of Shoney's Options. It is
expected that such distribution will occur by the middle of 1997.
10
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
GENERAL
As a result of the sale of the majority of the Company's assets (Note 2) and
the Company's Board's approval to adopt a Plan of Complete Liquidation, the
financial statements have been prepared on a liquidation basis of accounting.
Accordingly, assets have been valued at their estimated net realizable value
and liabilities include estimated costs to carry out the Plan of Complete
Liquidation. The net adjustment required during the quarter to convert from a
going concern (historical basis) to a liquidation basis of accounting was a
decrease in net assets of $1.25 million. This amount represents the Company's
estimate of the costs to carry out the Plan of Complete Liquidation.
RESULTS OF OPERATIONS
Prior to the Transaction, the Company's results of operations for the eight
week period from July 15, 1996 to September 8, 1996 are presented in the
accompanying financial statements. Since operations for the current year only
include eight and thirty-six weeks of actual operations, prior to the
Transaction, versus the twelve and forty weeks as included in the prior
periods, the results of operations are not comparable. Therefore, a comparison
of material changes in results of operations is not applicable.
SIGNIFICANT OR UNUSUAL ITEMS
The Company's results of operations for the twelve week period ended October
6, 1996 includes a gain on the Transaction of approximately $7.1 million. This
gain reflects the excess of the net proceeds and assumption of debt by Shoney's
in excess of the Company's basis in the assets sold. See Note 2 to the
Consolidated Financial Statements.
Other costs for the eight and thirty-six weeks ended September 8, 1996 included
on the Consolidated Statements of Income (Loss) and Changes in Net Assets in
Liquidation (the "Statement") includes approximately $.5 million and $5.3
million, respectively, of costs incurred in connection with the Transaction.
The adjustment to liquidation basis of accounting of $1.25 million included in
the Statement reflects management's estimate of the costs to carry out its Plan
of Complete Liquidation. In the event that any of these amounts are not
required to liquidate the Company, excess cash will be distributed to the
Company's shareholders in a final distribution (Note 2).
LIQUIDITY AND CAPITAL RESOURCES
The Company has no available short-term or long-term facilities. The Company
believes that its present cash and cash equivalents, short-term investments,
and earnings on such investments will allow it to implement its Plan of
Complete Liquidation. The Company made its initial distribution under its Plan
of Complete Liquidation on October 1, 1996 by distributing all of the Shoney's
Common Stock received in the Transaction to its shareholders of record at
September 24, 1996. As of October 6, 1996, the Company has approximately $4.6
million in assets in excess of its liabilities. The Company does not currently
intend to make any cash distributions to its shareholders until such time as
the period for creditors of the Company to present written proof of their
claims, if any, shall have expired. At such time, the Company's Board intends
to review the assets and liabilities of the Company and consider the effect of
all then known or anticipated liabilities and, after paying or making provision
for all then known or anticipated liabilities, it intends to declare a
distribution consisting of all of the then remaining cash other than the cash
required to be retained for holders of Shoney's Options. It is expected that
such distribution will occur by the middle of 1997.
11
<PAGE> 12
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Porpoise Asset Management and Lawrence Capital Management, Inc. v. J. Gary
Sharp, et al.; Brock Weiner v. TPI Enterprises, Inc., et al. and Crandon
Capital Partners, et al. v. TPI Enterprises, Inc., et al.
During 1995, three shareholder lawsuits were filed against the Company and
its Board of Directors. The Plaintiffs alleged, among other things, that
the Company's shareholders will receive inadequate consideration in the
proposed Transaction, that the Transaction is the result of unfair dealing
and economic coercion and that the Directors have breached their fiduciary
duties to the Company's shareholders to maximize shareholder value. The
plaintiffs sought class action status and to enjoin the proposed
transaction and recover damages. The Company signed a letter of
understanding dated March 15, 1996 for settlement of these three lawsuits,
which was subject to several conditions, including Court approval of the
settlement and the closing of the Transaction. On August 8, 1996, the
Court issued an order scheduling a hearing on the settlement for October
29, 1996. On October 29, 1996, the Court issued an Order and Final
Judgment consolidating the three lawsuits, certifying the class and
approving the settlement. The settlement required the payment by
the Company of $250,000 which is expected to be paid by the end of 1996.
The Company recorded a liability for $250,000 at December 31, 1996.
TPI Restaurants, Inc. v. Marlin Services, Inc., Marlin Electric, Inc., d/b/a
Marlin Services and the Aetna Casualty and Surety Company and Marlin
Electric, Inc. v. TPI Restaurants, Inc. and Related Matters
On March 7, 1996, the Company filed a civil action in the Circuit Court of
Palm Beach County; captioned TPI Restaurants, Inc. v. Marlin Services,
Inc., Marlin Electric, Inc., d/b/a Marlin Services, Inc. ("Marlin") and The
Aetna Casualty and Surety Company. The Company contended, among other
things, that Marlin breached terms of a maintenance service agreement that
TPIR had entered into with Marlin by failing to perform timely maintenance
as required by the agreement, overcharging for parts and materials,
improperly billing for labor and improperly charging for overhead. On
March 7, 1996, Marlin filed a separate action in the U.S. District Court of
Virginia against TPIR alleging among other things that TPIR breached its
contract with Marlin by failing to pay amounts owed under the contract.
Marlin claimed damages in excess of $2.2 million through March 1996.
On June 27, 1996, the Company entered into a settlement with Marlin. The
settlement provides for the payment to Marlin of an aggregate of $1,150,000
in cash in settlement of the civil action brought by Marlin against
Restaurants. Under the terms of the settlement agreement, Marlin shall be
obligated to use settlement proceeds to fulfill its obligations with all
subcontractors hired by Marlin to perform work under Marlin's maintenance
service agreement with Restaurants, and Marlin shall be entitled to the
excess, if any, after all of the subcontractors have been paid. No payment
shall be made to any subcontractor unless the subcontractor fully releases
Restaurants from any liability and releases all liens, if any, filed
against Restaurants. As part of the settlement, mutual releases have been
exchanged among the parties and the two civil actions will be dismissed.
Based on the terms of the settlement, the Company currently estimates that
it will spend an aggregate of $1,500,000 to settle this action, including
related legal costs. As of October 6, 1996, approximately $599,000 of the
$1,150,000 has been paid related to this settlement.
12
<PAGE> 13
Other Proceedings
To the Company's knowledge, the Company and its subsidiaries are not party
to any other outstanding lawsuits.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
27 - Financial Data Schedule (for SEC use only)
(b) Reports on Form 8-K:
Registrant filed a current report on Form 8-K dated September 9, 1996
reporting Item 2 - Acquisition or Disposition of Assets.
13
<PAGE> 14
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.
TPI ENTERPRISES, INC.
(Registrant)
Date: November 20, 1996 By: /s/ Frederick W. Burford
------------------------------------------
Frederick W. Burford
President, Chief Financial Officer
and Secretary
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF TPI ENTERPRISES, INC. FOR THE THREE MONTHS ENDED
OCTOBER 6, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-START> JUL-15-1996
<PERIOD-END> OCT-06-1996
<EXCHANGE-RATE> 1
<CASH> 2,101
<SECURITIES> 5,000
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 7,101
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 7,101
<CURRENT-LIABILITIES> 2,463
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 4,638<F1>
<TOTAL-LIABILITY-AND-EQUITY> 7,101<F1>
<SALES> 195,219
<TOTAL-REVENUES> 195,219
<CGS> 179,708
<TOTAL-COSTS> 191,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,596
<INCOME-PRETAX> 4,408
<INCOME-TAX> 0
<INCOME-CONTINUING> 4,408
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,408<F2>
<EPS-PRIMARY> 0<F3>
<EPS-DILUTED> 0<F3>
<FN>
<F1>THE COMPANY ADOPTED LIQUIDATION BASIS ACCOUNTING DURING THE QUARTER ENDED
OCTOBER 6, 1996 AS DISCUSSED IN NOTES 1 AND 2 TO THE CONSOLIDATED FINANCIAL
STATEMENTS. AS A RESULT, OTHER STOCKHOLDERS EQUITY REFLECTS NET ASSETS IN
EXCESS OF LIABILITIES AT OCTOBER 6, 1996.
<F2>NET INCOME FOR THE PERIOD INCLUDES A GAIN OF $7.1 MILLION IN CONNECTION
WITH THE SALE OF THE MAJORITY OF THE COMPANY'S ASSETS TO SHONEY'S, INC. SEE
NOTES 1 AND 2 TO THE CONSOLIDATED FINANCIAL STATEMENTS.
<F3>DUE TO THE LIQUIDATION BASIS OF ACCOUNTING BEING ADOPTED BY THE COMPANY,
EPS INFORMATION IS NOT APPLICABLE.
</FN>
</TABLE>
