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 (date of earliest event reported):
APRIL 3, 1996
CARROLS CORPORATION (Exact
name of Registrant as specified in its charter)
DELAWARE (State
or other jurisdiction of incorporation)
1-6553 16-0958146
(Commission File No.) (I.R.S. Employer
Identification No.)
968 JAMES STREET, SYRACUSE, NEW YORK 13203 (Address
of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code:
(315) 424-0513
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
ITEM 1. CHANGE IN CONTROL.
On April 3, 1996, pursuant to that certain Securities Purchase
Agreement, dated as of March 6, 1996, among the Registrant, Carrols
Holdings Corporation, a Delaware corporation and the sole shareholder of
the Registrant ("Holdings"), Atlantic Restaurants, Inc., a Delaware
corporation ("ARI"), and certain selling shareholders listed on Schedule I
thereto (the "Selling Shareholders"), the Selling Shareholders sold to ARI
approximately 97% of all of the issued and outstanding shares of common
stock, and securities that were convertible into or exercisable or
exchangeable for shares of common stock, of Holdings (the "Acquisition")
for an aggregate purchase price of approximately $84 million. ARI is an
indirect wholly-owned subsidiary of Bahrain International Bank (E.C.), a
Bahrain exempt joint stock company ("BIB"). The source of funds for the
Acquisition was debt and equity investments by wholly-owned subsidiaries of
BIB.
Consummation of the Acquisition constitutes a "change of control"
under the Indenture, dated as of August 17, 1993 (the "Indenture"), among
the Registrant, Holdings and Marine Midland Bank, N.A., as trustee,
governing the Registrant's $110 million aggregate principal amount
(currently $108.5 million outstanding) of 11-1/2% Senior Notes Due 2003
(the "Notes"). In accordance with the terms and conditions of the
Indenture, upon a "change of control", each holder of the Notes will have
the right to require the Registrant to repurchase all or any part of such
holder's Notes at a repurchase price in cash equal to 101% of the principal
amount of the Notes being repurchased (plus accrued and unpaid interest, if
any).
The Registrant hereby incorporates by reference the description
of the Acquisition included in (i) the press release of the Registrant
dated April 4, 1996 (attached hereto as Exhibit 99.1) and (ii) the Notice
of Change of Control and Offer to Repurchase Notes delivered to holders of
the Notes (attached hereto as Exhibit 99.2).
In connection with the Acquisition, the Registrant entered into
an Amended and Restated Employment Agreement with the Registrant's Chairman
and Chief Executive Officer, Alan Vituli, (attached hereto as Exhibit
10.23) and an Amended and Restated Employment Agreement with the
Registrant's President and Chief Operating Officer, Daniel T. Accordino,
(attached hereto as Exhibit 10.24), upon terms and conditions substantially
similar to their previous employment agreements except that, in lieu of the
current stock option plans maintained by Holdings (all of which will be
terminated in connection with the Acquisition) a new stock option plan will
be developed pursuant to which employees of the Registrant will be eligible
to be awarded options to purchase up to 9.09% of the outstanding common
stock of Holdings on a fully-diluted basis. Messrs. Vituli and Accordino
will receive 36% and 24%, respectively, of the options available in such
pool. The Registrant also entered into an Amended and Restated Split
Dollar Life Insurance Agreement for the benefit of Mr. Vituli (attached
hereto as Exhibit 10.25) and an Amended and Restated Split Dollar Life
Insurance Agreement for the benefit of Mr. Accordino (attached hereto as
Exhibit 10.26) upon terms and conditions substantially similar to the
previous insurance agreements except that the Registrant does not have the
right to unilaterally terminate such agreements.
In addition, in connection with the Acquisition, each of M. Bruce
Adelberg, Richard V. Cross and Franklin Glasgall resigned from the Board of
Directors of the Registrant and of Holdings. Immediately following
completion of the Acquisition, Robin McIlvenny, David J. Mathies, Jr. and
Paul W. Durrant, each an officer of ARI or one of its affiliates, were each
elected to the five-person Board of Directors of the Registrant and of
Holdings.
In connection with the Acquisition, the Registrant also entered
into a Seventh Amendment to Third Amended and Restated Loan and Security
Agreement, dated as of April 3, 1996, among Heller Financial, Inc.,
Holdings and the Registrant (attached hereto as Exhibit 10.27), which
provides, among other things, for the expansion of the portion of the
Registrant's senior secured revolving credit facility that may be used to
repurchase Notes.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS.
Exhibit 10.23 - Amended and Restated Employment Agreement
between Carrols Corporation and Alan Vituli,
dated as of April 3, 1996.
Exhibit 10.24 - Amended and Restated Employment Agreement
between Carrols Corporation and Daniel T.
Accordino, dated as of April 3, 1996.
Exhibit 10.25 - Amended and Restated Split Dollar Life
Insurance Agreement for the benefit of Alan
Vituli, dated as of April 3, 1996.
Exhibit 10.26 - Amended and Restated Split Dollar Life
Insurance Agreement for the benefit of Daniel
T. Accordino, dated as of April 3, 1996.
Exhibit 10.27 - Seventh Amendment to Third Amended and
Restated Loan and Security Agreement, dated
as of April 3, 1996, by and among Carrols
Corporation and Carrols Holdings Corporation,
as "Borrower", and Heller Financial, Inc., as
"Lender".
Exhibit 99.1 - Press Release issued by the Registrant
on April 4, 1996.
Exhibit 99.2 - Notice of Change of Control and Offer to
Repurchase Notes dated April 8, 1996.
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.
Dated: April 10, 1996
CARROLS CORPORATION
By: /s/Alan Vituli
Name: Alan Vituli
Title: Chief Executive Officer
EXHIBIT INDEX
EXHIBIT NUMBER EXHIBIT TITLE PAGE NUMBER
Exhibit 10.23 - Amended and Restated 6
Employment Agreement between
Carrols Corporation and
Alan Vituli, dated as of
April 3, 1996.
Exhibit 10.24 - Amended and Restated 20
Employment Agreement between
Carrols Corporation and
Daniel T. Accordino, dated
as of April 3, 1996.
Exhibit 10.25 - Amended and Restated 33
Split Dollar Life Insurance
Agreement for the benefit
of Alan Vituli, dated as
of April 3, 1996.
Exhibit 10.26 - Amended and Restated 41
Split Dollar Life Insurance
Agreement for the benefit
of Daniel T. Accordino,
dated as of April 3, 1996.
Exhibit 10.27 - Seventh Amendment to Third 49
Amended and Restated Loan
and Security Agreement,
dated as of April 3, 1996,
by and among Carrols
Corporation and Carrols
Holdings Corporation, as
"Borrower", and Heller
Financial, Inc., as "Lender".
Exhibit 99.1 - Press Release issued by the 57
Registrant on April 4, 1996.
Exhibit 99.2 - Notice of Change of Control 59
and Offer to Repurchase
Notes dated April 8, 1996.