As filed with the Securities and Exchange Commission on May 3, 1994
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-11
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
--------------------
FM 1993A CORP.
(Exact name of registrant as specified in governing instruments)
CRC-I LIMITED PARTNERSHIP
CRC-II LIMITED PARTNERSHIP
FOODMAKER, INC.
(exact name of co-registrants as specified in their governing instruments)
-------------------
One Financial Center, 13th Floor 9330 Balboa Avenue
Boston, Massachusetts 02111 San Diego, California 92123
-------------------------------- ---------------------------
(Address of principal executive (Address of principal executive
offices of FM 1993A Corp., offices of
CRC-I and CRC-II) Foodmaker, Inc. )
Charles W. Duddles
9330 Balboa Avenue
San Diego, California 92123
-------------------------------
(Name and address of registrant's and
co-registrants' agent for service)
With copies to:
Rhonda S. Wagner, Esq.
Gibson, Dunn & Crutcher
750 B Street, Suite 3300
San Diego, California 92101
(619) 544-8025
--------------------
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration Statement.
--------------------
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Securities to be Price Offering Registration
being Registered Registered Per Unit(1) Price(1) Fee
---------------- ---------- ----------- -------- ------------
Series B 9.75% Senior
Secured Notes due
November 1, 2003 $70,000,000 100% $70,000,000 $24,138
CRC-I Guaranty thereof _ _ _ _
CRC-II Guaranty thereof _ _ _ _
(1) Estimated solely for the purpose of calculating the registration fee.
--------------------
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
FM 1993A CORP.
Cross Reference Sheet Showing Location in Prospectus of Information
Required by Items of Part I of Form S-11
Numbers and Captions Location or Heading in Prospectus
-------------------- ---------------------------------
1. Forepart of the Registration Outside Front Cover Page of
Statement and Outside Front Cover Prospectus
Page of Prospectus
2. Inside Front and Outside Back Cover Inside Front Cover and Outside Back
Pages of Prospectus Cover Pages of Prospectus; Table of
Contents; Available Information;
Incorporation of Certain Documents by
Reference
3. Summary Information, Risk Factors, Prospectus Summary; Risk Factors
and Ratio of Earnings to Fixed
Charges
4. Determination of Offering Price The Exchange Offer
5. Dilution Not Applicable
6. Selling Security Holders Not Applicable
7. Plan of Distribution Prospectus Summary; The Exchange
Offer
8. Use of Proceeds The Exchange Offer
9. Selected Financial Data Selected Unaudited Pro Forma
Financial Data
10. Management's Discussion and Analysis Management's Discussion and Anaylsis
of Financial Condition and Results of of Financial Condition and Results of
Operations Operations
11. General Information as to Registrant Prospectus Summary; Business
12. Policy with Respect to Certain Prospectus Summary; Business
Activities
13. Investment Policies of Registrant Prospectus Summary; Description of
Leases; Business
14. Description of Real Estate Description of Underlying
Transactions
15. Operating Data Description of Leases
16. Tax Treatment of Registrant and Its Certain Federal Income Tax
Security Holders Consequences
17. Market Price of and Dividends on the Equity Ownership
Registrant's Common Equity and
Related Stockholder Matters
18. Description of Registrant's Prospectus Summary; Description of
Securities Notes
19. Legal Proceedings Not Applicable
20. Security Ownership of Certain Equity Ownership
Beneficial Owners and Management
21. Directors and Executive Officers Management
22. Executive Compensation Management
23. Certain Relationships and Related Not Applicable
Transactions
24. Selection, Management and Custody of Business
Registrant's Investments
25. Policies with Respect to Certain Prospectus Summary; Business
Transactions
26. Limitations of Liability Description of Underlying
Transactions; Description of New
Notes
Numbers and Captions Location or Heading in Prospectus
-------------------- ---------------------------------
27. Financial Statements and Information Incorporation of Certain Foodmaker
Documents by Reference
28. Interests of Named Experts and Not Applicable
Counsel
29. Disclosure of Commission Position on Not Applicable
Indemnification for Securities Act
Liabilities
SUBJECT TO COMPLETION, DATED MAY , 1994
P R O S P E C T U S
FM 1993A CORP.
Offer for all Outstanding
Privately Placed 9.75% Senior Secured Notes
due November 1, 2003
in Exchange for
Series B 9.75% Senior Secured Notes due November 1, 2003
Guaranteed by CRC-I Limited Partnership and CRC-II Limited Partnership
The offer will expire at midnight, New York City time,
on ______________, 1994, unless extended.
FM 1993A Corp. (the "Issuer"), a Delaware corporation, hereby offers (the
"Exchange Offer"), upon the terms and subject to the conditions set forth
herein and in the related Letter of Transmittal, to exchange up to $70 million
aggregate principal amount of Series B 9.75% Senior Secured Notes due
November 1, 2003 (the "New Notes") of the Issuer for a like amount of privately
placed 9.75% Senior Secured Notes due November 1, 2003 (the "Old Notes" and
together with the New Notes, the "Notes") from the holders (the "Holders of Old
Notes"; individually, a "Holder of Old Notes") thereof.
The New Notes are being offered hereunder in order to satisfy the
obligations of the Issuer under a registration rights agreement dated as of
December 15, 1993 (the "Registration Rights Agreement") among the Issuer,
Foodmaker, Inc. ("Foodmaker" or "Lessee"), CRC-I Limited Partnership ("CRC-I"),
CRC-II Limited Partnership ("CRC-II") and the purchasers of the Old Notes who
are signatories to the Registration Rights Agreement (the "Initial
Purchasers"). The Exchange Offer is designed to provide to Holders of Old
Notes an opportunity to acquire New Notes which, unlike the Old Notes, are
expected to be freely transferable at all times, subject to state securities or
"blue sky" law restrictions, provided that the Holder of Old Notes is not an
"affiliate" of the Issuer within the meaning of the Securities Act of 1933, as
amended (the "Securities Act"), and represents that the New Notes are being
acquired in the ordinary course of such holder's business and that said Holder
of Old Notes is not engaged in, and does not intend to engage in, a
distribution of the New Notes. With the exception of the freely transferable
nature of the New Notes, the New Notes are substantially identical to the Old
Notes. Both the Old Notes and the New Notes are guaranteed by CRC-I and CRC-II
but are without recourse to the general partners of such limited partnerships.
See "The Exchange Offer - Purpose of the Exchange Offer."
The Issuer will accept for exchange any and all validly tendered Old Notes
on or prior to midnight, New York time, on ______________, 1994, unless
extended (the "Expiration Date"). Tenders of Old Notes made pursuant to the
Exchange Offer may not be withdrawn. Foodmaker will pay the expenses of the
Exchange Offer.
The New Notes will bear interest from July 1, 1994. Accordingly, Holders
of Old Notes who receive New Notes in exchange for Old Notes will forego
accrued but unpaid interest on their exchanged Old Notes for the period from
July 1, 1994 to the date of exchange, but will be entitled to such interest
under the New Notes. See "Description of New Notes."
The Issuer makes no recommendation to Holders of Old Notes as to whether
to tender or refrain from tendering all of any portion of their Old Notes
pursuant to the Exchange Offer. In addition, no one has been authorized to
make any such recommendation. Holders of Old Notes must make their own
decision whether to tender pursuant to the Exchange Offer and, if so, the
principal amount of Old Notes to tender after reading this Prospectus and
consulting with their advisors, if any, based on their own financial position
and requirements.
The Exchange Offer is not conditioned upon any minimum principal amount of
Old Notes being tendered for exchange. However, the Exchange Offer is subject
to certain customary conditions. See "The Exchange Offer."
FOR A DISCUSSION OF CERTAIN OTHER CONSIDERATIONS RELEVANT TO AN
INVESTMENT IN
THE NEW NOTES, SEE "RISK FACTORS."
-------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE
COMMISSION OR ANY STATE COMMISSION PASSED UPON THE ACCURACY
OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------------------
The date of this Prospectus is ______________, 1994.
INCORPORATION OF CERTAIN FOODMAKER DOCUMENTS BY REFERENCE
The following documents previously filed with the Securities and Exchange
Commission (the "Commission") by Foodmaker pursuant to the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), are incorporated herein by
reference and made a part hereof: (1) Foodmaker's Annual Report on Form 10-K
for the fiscal year ended October 3, 1993; (2) Foodmaker's Quarterly Reports on
Form 10-Q for the fiscal quarters ended January 23, 1994[, and April __, 1994];
and (3) Foodmaker's Current Report on Form 8-K/A dated January 27, 1994.
Each document filed by Foodmaker pursuant to Sections 13(a), 13(c), 14 or
15(d) the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the New Notes made hereby shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date of filing of such document.
Any statement contained herein or in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or
is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
Foodmaker will provide without charge to each person, including any
beneficial owner of Old Notes, to whom this Prospectus is delivered, upon the
written or oral request of such person, a copy of any or all of the documents
which have been incorporated by reference in this Prospectus (other than
exhibits to such documents which are not specifically incorporated by reference
into such documents). Such requests should be directed to Foodmaker, Inc.,
Attn: Corporate Communications, 9330 Balboa Avenue, San Diego, California
92123, (619) 571-2121.
AVAILABLE INFORMATION
The Issuer has filed with the Commission a registration statement relating
to the New Notes offered hereby (herein, together with all amendments and
exhibits, referred to as the "Registration Statement") under the Securities
Act. This Prospectus does not contain all of the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. For further information,
reference is hereby made to the Registration Statement. Statements made in
this Prospectus as to the contents of any contract, agreement or other document
referred to are not necessarily complete. With respect to each such contract,
agreement or other document filed as an exhibit to the Registration Statement,
reference is made to such exhibit for a more complete description thereof, and
each such statement shall be deemed qualified in its entirety by such
reference. The Registration Statement and the exhibits and schedules thereto
may be inspected without charge and copied at prescribed rates at the Public
Reference Section of the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Commission's regional offices at 7 World
Trade Center, New York, New York 10048 and at the Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
The Issuer is required under the terms of an indenture dated as of
December 15, 1993, between the Issuer and State Street Bank and Trust Company,
as trustee (the "Trustee"), as amended by an amendment dated
__________________, 1994 (the "Indenture"), to provide a copy of: (i) a
balance sheet of the Issuer at the end of each year setting forth in
comparative form the figures for the corresponding period in the previous
fiscal year, and (ii) statements of income and retained earnings and of changes
in cash flows of the Issuer for such year, setting forth in comparative form
the figures for the previous fiscal year, all in reasonable detail and
certified by the treasurer of the Issuer as being accurate and complete and, if
requested by the holders of more than 50% of the aggregate principal amount of
all Notes outstanding, or if required under any applicable securities laws,
accompanied by a letter from a firm of independent certified public accountants
of nationally recognized reputation, which certificate shall state that such
financial statements fairly present the financial condition of the Issuer and
that the examination of such accountants in connection therewith has been made
in accordance with generally accepted auditing standards, and accordingly
employed such tests of the accounting records and such other auditing
procedures as were deemed necessary.
Moreover, during the period beginning on the original issuance date of the
Old Notes and ending on the date that is three years from such date, the Issuer
is required, during any period in which Foodmaker or the Issuer is not subject
to
2
Section 13 or 15(d) under the Exchange Act, to make available to any
Holder or beneficial holder of Old Notes which continue to be Restricted Notes,
in connection with any sale thereof, and make available to any prospective
purchaser of Old Notes from such Holder or beneficial holder of Old Notes, the
information required pursuant to Rule 144A(d)(4) under the Securities Act upon
the request of such Holder or beneficial holder of Old Notes. The Issuer is
also required to take such further action as any Holder or beneficial holder of
Old Notes may reasonably request, all to the extent required from time to time,
to enable such Holder or beneficial holder of Old Notes to sell its Old Notes
without registration under the Securities Act within the limitation of the
exemption provided by Rule 144A, as such rule may be amended from time to time.
Upon the request of any Holder or beneficial holder of Old Notes, the Issuer is
required to deliver to such Holder or beneficial holder of Old Notes a written
statement as to whether it has complied with such requirements.
----------------
3
Based on interpretive letters previously issued by the Staff of the
Division of Corporation Finance of the Commission to third parties, the Issuer
believes that the New Notes issued pursuant to the Exchange Offer may be
offered for resale, resold and otherwise transferred by any holder thereof,
without complying with the registration and prospectus delivery provisions of
the Securities Act, provided that such holder (i) is not an "affiliate" or
"promoter" (as such terms are defined in Rule 405 under the Securities Act) of
the Issuer, (ii) is not participating in a distribution of the New Notes to be
received in the Exchange Offer, (iii) is not, except as noted below, a broker-
dealer and (iv) is acquiring the New Notes in the ordinary course of such
holder's business. Based on the prior interpretive letters, no broker-dealer
may resell or otherwise transfer New Notes issued pursuant to the Exchange
Offer without complying with the registration requirements of the Securities
Act, unless (a) such broker-dealer is holding Old Notes only as nominee, or
(b)(i) such broker-dealer acquired the Old Notes for its own account as a
result of market-making or other trading activities and undertakes to satisfy
certain conditions consistent with the requirements of the Securities Act,
including the delivery of a prospectus which contains a plan of distribution
with respect to such resale transactions (such plan of distribution need not
name the broker-dealer or disclose the amount of New Notes held by the broker-
dealer), and (ii) such broker-dealer has not entered into any arrangement or
understanding with the Issuer or an affiliate of the Issuer to distribute the
New Notes received pursuant to the Exchange Offer. If any Holder of Old Notes
does not satisfy any of the foregoing conditions, such holder may not be
entitled to rely on the previously issued interpretive letters.
4
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus.
The Issuer
On January 5, 1994, in a private placement transaction, the Issuer issued
and sold $70,000,000 aggregate principal amount of Old Notes. Proceeds from
the issuance of the Old Notes were used to purchase two secured promissory
notes issued by two special purpose Massachusetts limited partnerships, CRC-I
and CRC-II, in the principal amounts of $30,172,952 and $39,827,048, from CRC-I
and CRC-II, respectively (the "CRC-I Note" and the "CRC-II Note", respectively;
collectively, the "CRC Notes"). The Issuer is making the Exchange Offer to
satisfy its obligations under the Registration Rights Agreement, which requires
the Issuer to use its best efforts to effect the Exchange Offer. The Issuer
will not receive any additional proceeds from the offering of the New Notes.
The Exchange Offer
Securities Offered Up to $70,000,000 aggregate principal amount of
Series B 9.75% Senior Secured Notes due
November 1, 2003.
The Exchange Offer The New Notes are being offered in exchange for a
like principal amount of the Old Notes. The
issuance of the New Notes is intended to satisfy
the obligations of the Issuer under the terms of
the Registration Rights Agreement. The New Notes
are substantially identical to the Old Notes
except that the New Notes will be registered under
the Securities Act.
Expiration Date;
No Withdrawal Rights The Exchange Offer shall expire at midnight, New
York City time on _________, 1994 or such later
date to which it is extended by the Issuer (the
"Expiration Date"). Old Notes tendered pursuant
to the Exchange Offer and the Letter of
Transmittal delivered herewith may not be
withdrawn.
Accrued Interest on the The New Notes will bear interest from and
New Notes including July 1, 1994 (the day after the last
date for which interest will have been paid on the
Old Notes prior to the exchange). Accordingly,
Holders of Old Notes who receive New Notes in
exchange for Old Notes will forego accrued but
unpaid interest on their exchanged Old Notes for
the period from and including July 1, 1994 to the
date of exchange, but will be entitled to such
interest under the New Notes.
Conditions of the Exchange The Exchange Offer is subject to certain customary
Offer conditions, any or all of which may be waived by
the Issuer. See "The Exchange Offer - Conditions
to the Exchange Offer."
Procedures for Tendering
Old Notes Each Holder of Old Notes wishing to accept the
Exchange Offer must complete and sign the Letter
of Transmittal, in accordance with the
instructions contained therein and submit the
Letter of Transmittal to the Exchange Agent
identified below. See "The Exchange Offer -
Procedures for Tendering."
5
Guaranteed Delivery Holders of Old Notes who wish to tender their Old
Procedures Notes and whose Old Notes are not immediately
available or who cannot deliver their Old Notes
and Letter of Transmittal or any other documents
required by the Letter of Transmittal to the
Exchange Agent prior to the Expiration Date, must
tender their Old Notes according to the guaranteed
delivery procedures set forth in "The Exchange
Offer - Guaranteed Delivery Procedures."
Acceptance of Old Notes
and Delivery of New
Notes The Issuer will accept for exchange any and all
Old Notes which are properly tendered in the
Exchange Offer prior to midnight, New York City
time, on the Expiration Date. The New Notes
issued pursuant to the Exchange Offer will be
delivered promptly following the Expiration Date.
See "The Exchange Offer - Acceptance of Old Notes
for Exchange; Delivery of New Notes."
Exchange Agent State Street Bank and Trust Company; telephone
(617) 985-3023. See "The Exchange Offer -
Exchange Agent."
6
Terms Of The New Notes
Issuer The Issuer is a special purpose corporation formed
for purposes of issuing the Old Notes and the New
Notes (for its own account and as agent acting on
behalf of CRC-I and CRC-II) and purchasing the CRC
Notes.
Issue Principal Amount Up to $70 million principal amount of senior
secured notes.
Comparison with Old Notes It is expected that the New Notes will be freely
transferable under the Securities Act by Holders
of New Notes who are not affiliates of the Issuer,
subject to any restrictions on transfer imposed by
state securities or "blue sky" laws and those
described in "The Exchange Offer - Resales of New
Notes." The Holders of Old Notes are currently
entitled to certain registration rights pursuant
to the Registration Rights Agreement.
Consummation of the Exchange Offer will satisfy
the Issuer's obligations thereunder, and Holders
of Old Notes who do not exchange their Old Notes
for New Notes will no longer be entitled to any
registration rights and will not be able to
reoffer, resell or otherwise dispose of their Old
Notes, unless they are subsequently registered
under the Securities Act, which the Issuer will
have no obligation to do, or unless an exemption
from the registration requirements of the
Securities Act is available. See "The Exchange
Offer - Purpose of the Exchange Offer." The New
Notes otherwise will be substantially identical in
all respects to the Old Notes.
To the extent that Holders of Old Notes do not
participate in the Exchange Offer and Old Notes
remain outstanding after the consummation of the
Exchange Offer, any prepayments on the Notes would
be made on a pro rata basis pursuant to the
prepayment provisions contained in the Indenture.
In addition, Holders of New Notes and Old Notes,
together ("Holders of Notes"), will have the
voting and other rights described therein.
Maturity November 1, 2003.
Interest Rate 9.75% per annum.
Priority The New Notes will be senior secured indebtedness
of the Issuer.
Interest Payment Dates Semi-annual on the first business day of each
January and July, commencing on the first business
day of July, 1994 and continuing through the first
business day of July, 2003. A final interest
payment will also be due at Maturity.
Optional Prepayment Non-prepayable for five years. Thereafter
prepayable at the option of the Lessee in the
event of an "Early Termination" (i.e., termination
of the Lease and a reconveyance of the Deed of
Trust) of one of the Existing Assets (other than
Potential Existing Assets) or Construction Assets
(other than Potential Construction Assets), as the
case may be pursuant to the CRC Leases (as that
term is defined in "- The Underlying
Transactions") and the CRC Notes at the following
premiums: year six - 5.00%, year seven - 3.75%,
year eight - 2.50%, year nine - 1.25%, year ten -
0.00%. The principal amounts prepaid are to be
credited against the payment due at the beginning
of the tenth year.
7
Amortization Interest-only payments through year nine; by the
beginning of year ten, 50% of the original Issue
Principal Amount must have been repaid; the
balance is due upon Maturity.
Collateral for Notes; The New Notes will be secured by, among other
Guaranties things, the following (collectively, the "Note
Collateral"):
(1) The pledge by the Issuer to the Trustee of
the CRC Notes and the CRC Collateral (as defined
below); and
(2) A pledge of the Issuer's rights in and to
the Collection Account, the Construction
Account, the Sinking Fund Account and the Equity
Collection Account (each as described in
"Description of the Underlying Transactions -
Construction Account - Collection,
Administrative Expenses, Sinking Fund and Equity
Collection Accounts") as well as certain other
accounts to be maintained by the Trustee
pursuant to the Indenture, and all funds held
therein.
The New Notes will also be guaranteed by each of
CRC-I and CRC-II, which guaranties will be
nonrecourse to the general partners of each of
CRC-I and CRC-II.
CRC-I Note Collateral The CRC-I Note is secured by, among other things,
the following (collectively, the "CRC-I
Collateral"):
(1) An absolute assignment to the Issuer of
CRC-I's rights as Lessor under the CRC-I
Lease (as defined in "- The Underlying
Transactions");
(2) A first priority deed of trust in favor of
the Issuer on CRC-I's rights in the Existing
Assets under the Estates For Years (as such
terms are defined in "- The Underlying
Transactions"), as acquired; and
(3) A first priority deed of trust in favor of
the Issuer on Foodmaker's reversionary rights
in the Existing Assets.
The CRC-I Note is cross-collateralized with the
CRC-II Collateral (as defined below).
CRC-II Note Collateral The CRC-II Note is secured by, among other things,
the following (collectively, the "CRC-II
Collateral," and together with the CRC-I
Collateral, the "CRC Collateral").
(1) An absolute assignment to the Issuer of
CRC-II's rights as Lessor under the CRC-II
Lease (as defined in "- The Underlying
Transactions");
(2) A first priority deed of trust in favor of
the Issuer on CRC-II's rights in the
Construction Assets under the Estates For
Years, (as such terms are defined in "- The
Underlying Transactions"), as acquired; and
(3) A first priority deed of trust in favor of
the Issuer on Foodmaker's reversionary rights
in the Construction Assets, as acquired.
The CRC-II Note is cross-collateralized with the
CRC-I Collateral.
8
Payments of Principal and
Interest Prior to
Maturity; the Sinking
Fund The CRC Notes are interest-only through year nine
with interest payments required semi-annually as
described above. In addition to the semi-annual
interest payments, CRC-I and CRC-II must pay
$25,000 semi-annually through Maturity to fund
certain administrative expenses. Semi-annual
sinking fund payments of $747,402 through year
nine, and a special sinking fund payment of
$5,500,000 due the last business day of
December 2002, will be collectively applied to pay
a portion of the principal payment due at the
beginning of year ten. These sinking fund
obligations will be reduced to the extent of an
Early Termination. See "Description of the Leases
- Early Termination; Lease Modification." All of
these payments are expected to be covered by the
Basic Rent and Special Rent payments to be made by
Foodmaker under the CRC Leases. See "Description
of the Leases - Rental Rates."
By the beginning of year ten, the outstanding
balance of the Notes must be reduced to
$35,000,000 or less. The sinking fund will be
applied at the beginning of year ten to reduce the
outstanding debt, and CRC-I and CRC-II will be
obligated to make an additional principal payment
equal to the difference between $35,000,000 and
the balance in the sinking fund. This additional
principal payment is required to be covered by the
special rent payments and the purchase price
payable under the rejectable offer required to be
made by Foodmaker under the CRC Leases (the "Year
Nine Offer") not less than 120 nor more than 270
days prior to the first business day of January,
2003 (the "Year Nine Termination Date"). See
"Description of the Leases - Rejectable Offer
Requirements."
After the payment due at the beginning of year ten
as described above, CRC-I and CRC-II are required
to make one additional semi-annual payment on the
first business day of July, 2003 of interest only
and $25,000 to fund certain administrative
expenses, and then upon Maturity must pay the
remaining principal balance plus accrued interest
plus a final $25,000 payment for administrative
expenses. These payments are required to be
covered by the Basic Rent payable by Foodmaker
under the CRC Leases plus the Rejectable Offer
required to be made by Foodmaker under the CRC
Leases at Maturity. See "Description of the
Leases - Rejectable Offer Requirements."
Certain Covenants The Indenture pursuant to which the New Notes will
be issued restricts, among other things, the
incurrence of additional indebtedness, the use of
proceeds from the sale and issuance of the Old
Notes, the creation of certain liens, transactions
with affiliates, the engagement in any business or
activity other than that expressly permitted by
the Indenture, and the merger or consolidation of
the Issuer or the transfer of any part of the
Trust Estate (as defined in "Description of the
New Notes - Certain Definitions"), except as
expressly permitted by the Indenture. See
"Description of New Notes - Certain Covenants."
For more complete information regarding the New
Notes, see "Description of New Notes."
9
The Underlying Transactions
The following is a summary description of the transactions underlying the
Exchange Offer. On January 5, 1994, in a private placement transaction, the
Issuer issued and sold $70,000,000 aggregate principal amount of Old Notes.
The Issuer used the proceeds from the sale of the Old Notes to purchase the CRC
Notes. The proceeds from the purchase of the CRC Notes were used by CRC-I and
CRC-II to enable each of them to acquire from Foodmaker estates for years to
expire on November 30, 2028 (the "Estates for Years," individually, an "Estate
For Years") in: (1) in the case of CRC-I, 38 existing Jack In The Box
restaurants (the "Existing Assets"), and (2) in the case of CRC-II, four
existing Jack In The Box restaurants and approximately 34 to-be-constructed
Jack In The Box restaurants (collectively, the "Construction Assets") subject
to Foodmaker's right of substitution, as described in "Description of the
Leases - Right of Substitution." The locations of the Existing Assets,
including those Existing Assets which Foodmaker has not yet acquired fee title
to (the "Potential Existing Assets;" individually, a "Potential Existing
Asset") and the locations of the Construction Assets, including those
Construction Assets which Foodmaker has not yet acquired fee title to (the
"Potential Construction Assets;" individually, a "Potential Construction
Asset"), are identified in "Description of the Underlying Transactions -
Schedule of Properties."
Pursuant to a Note Purchase Agreement between the Issuer and CRC-I, a
portion of the proceeds from the sale of the Old Notes was used to purchase the
CRC-I Note, issued by CRC-I in the principal amount of $30,172,952, for a
purchase price equal to $28,633,100 (the "CRC-I Note Purchase Price").
Pursuant to a Note Purchase Agreement between the Issuer and CRC-II, a portion
of the proceeds from the sale of the Old Notes was used to purchase the CRC-II
Note, issued by CRC-II in the principal amount of $39,827,048, for a purchase
price equal to $37,794,505 (the "CRC-II Note Purchase Price"). The purchase
price for each of the CRC Notes has been disbursed in full; however, a portion
of the purchase price for each such note has been held as collateral security
for the Notes by the Trustee acting on behalf of the Holders of Notes, pursuant
to the terms of the Indenture, to be released by the Trustee to Foodmaker from
time to time (a) in the case of the Potential Existing Assets, as soon as
Foodmaker has acquired fee title thereto and conveyed an Estate For Years
therein to CRC-I and all other conditions contained in the Indenture to the
release of the portion of the CRC-I Note Purchase Price allocable thereto have
been satisfied, and (b) in the case of the Potential Construction Assets, as
soon as Foodmaker has acquired fee title thereto and conveyed an Estate for
Years therein to CRC-II and all other conditions contained in the Indenture to
the release of the portion of the CRC-II Note Purchase Price allocable thereto
have been satisfied.
Concurrently with the acquisition by CRC-I of the Estate For Years in the
Existing Assets (other than the Potential Existing Assets), CRC-I leased such
Existing Assets to Foodmaker pursuant to a long-term, bond-type, triple-net
master lease (the "CRC-I Lease"). Similarly, concurrently with the acquisition
by CRC-II of the Estate For Years in the Construction Assets (other than the
Potential Construction Assets), CRC-II leased such Construction Assets to
Foodmaker pursuant to a long-term, bond-type triple-net master lease (the
"CRC-II Lease"). As CRC-I acquires the Estates For Years in the Potential
Existing Assets, upon the acquisition by Foodmaker of the fee interest in the
location thereof (subject to Foodmaker's right of substitution as it relates to
the Potential Existing Assets, as described in "Description of the Leases -
Right of Substitution"), the CRC-I Lease will be amended to subject such
Potential Existing Assets to the CRC-I Lease. Likewise, as CRC-II acquires the
Estate For Years in the Potential Construction Assets, upon the acquisition by
Foodmaker of the fee interest in the location thereof (subject to Foodmaker's
right of substitution as it relates to the Potential Construction Assets, as
described in "Description of the Leases - Right of Substitution"), the CRC-II
Lease will be amended to subject such Potential Construction Assets to the
CRC-II Lease. The CRC-I Lease and the CRC-II Lease shall hereinafter be
referred to as the "CRC Leases" or the "Leases." Each of the CRC Leases will
have an initial term expiring on November 1, 2003 (the "Basic Term").
Since January 5, 1994, Foodmaker has been responsible for, and is required
to make beginning July 1, 1994, rental payments on all of the Existing Assets
(including the Potential Existing Assets) under the CRC-I Lease regardless of
whether CRC-I has acquired the Estate For Years therein or whether all other
conditions to the release of the portions of the CRC-I Note Purchase Price
allocable thereto have been satisfied. Since January 5, 1994, Foodmaker has
also been responsible for, and is required to make beginning July 1, 1994,
rental payments on each Construction Asset (including the Potential
Construction Assets) under the CRC-II Lease regardless of whether each
Construction Asset has been acquired and/or construction has been completed by
Foodmaker and whether CRC-II has acquired an Estate For Years therein or
whether all other conditions to the release of the portion of the CRC-II Note
Purchase Price allocable thereto have been
10
satisfied. As more fully described in the "Description of the Underlying
Transactions," the aggregate payments required to be made by Foodmaker under
the CRC-I Lease and the CRC-II Lease are sufficient to pay interest and
principal on the Notes by the end of the Basic Term.
The CRC Leases require Foodmaker to make the Year Nine Offer not less than
120 nor more than 270 days prior to the Year Nine Termination Date and to
purchase the Estates For Years in certain properties designated by Foodmaker in
the Year Nine Offer from CRC-I and CRC-II in the minimum amount of $12 million
(subject to Foodmaker's rights of Early Termination, see "Description of the
Leases - Early Termination; Lease Modification") which amount, when added to
the then-existing balance in a sinking fund which Foodmaker is required to fund
on a semi-annual basis pursuant to the terms of the Leases, would be sufficient
to liquidate 50% of the then outstanding principal balance of the Notes. The
CRC Leases also require Foodmaker to make a rejectable offer prior to the end
of the Basic Term to purchase CRC-I's and CRC-II's Estates For Years in the
remaining properties in an amount at least equal to the then outstanding
principal balance of the Notes. Said rejectable offer amounts shall be reduced
to the extent there is an Early Termination, or in the event Foodmaker
exercises its option to purchase CRC-I's or CRC-II's Estate For Years in any of
the properties, in each case pursuant to the CRC Leases and as described in the
"Description of the Leases." In order for CRC-I or CRC-II to reject either
such rejectable offer, CRC-I or CRC-II must deliver to the Trustee the
principal balance of the Notes allocable to the properties as to which such
rejectable offer has been made. See "Description of the Leases - Rejectable
Offer Requirements."
As collateral security for the CRC-I Note, CRC-I has granted to the Issuer
a security interest in and lien upon the CRC-I Collateral and CRC-II has
granted to the Issuer a security interest in and lien upon the CRC-II
Collateral. Similarly, as collateral security for the CRC-II Note, CRC-II has
granted to the Issuer a security interest in and lien upon the CRC-II
Collateral and CRC-I has granted to the Issuer a security interest in and lien
upon the CRC-I Collateral. The CRC-I Note and the CRC-II Note and the CRC
Collateral therefor has been pledged and assigned to the Trustee for the
benefit of Holders of Notes. In addition, each of CRC-I and CRC-II has
executed and delivered to the Trustee a guaranty of the Notes (the "CRC-I
Guaranty" and the CRC-II Guaranty, respectively), which guaranties are
nonrecourse to the general partners of each of CRC-I and CRC-II.
Foodmaker owns, operates and franchises the Jack In The Box restaurant
concept. Jack In The Box, with system-wide sales of $1,026.1 million in fiscal
1993, has restaurants located principally in the Western and Southwestern
United States. In addition, the Company owns an approximately 40% equity
interest in Family Restaurants, Inc., the operator of approximately 350 family
restaurants located primarily in California and parts of the Southwest under
the Carrow's and Coco's formats and approximately 315 Mexican restaurants
nationwide operated under the Chi-Chi's, El Torito and Casa Gallardo names.
Risk Factors
Prospective purchasers of the New Notes offered hereby should consider the
information set forth under "Risk Factors," as well as the other information
set forth in this Prospectus.
11
Transaction Schematic
Narrative of graphical information presented in the Prospectus.
A diagram is presented illustrating the following activities:
Foodmaker, Inc.:
Sale of Estate for Years on Ex. Assets to CRC-I
Sale of Estate for Years on Con. Assets to CRC-II
Semi-Annual Lease Payments to Indenture Trustee
CRC-I Special-Purpose Entity (Ex. Assets)(1):
CRC-I Note sold to Issuer and CRC-I Collateral assigned to Issuer
CRC-I Guaranty provided to Indenture Trustee
10-Year Lease of Ex. Assets to Foodmaker
CRC-II Special-Purpose Entity (Con. Assets)(2):
CRC-II Note sold to Issuer and CRC-II Collateral assigned to Issuer
CRC-II Guaranty provided to Indenture Trustee
10-Year Lease of Con. Assets to Foodmaker
Issuer:
Sell Notes to Noteholders
Purchase of CRC-I Note from CRC-I
Purchase of CRC-II Note from CRC-II
Indenture Trustee:
Semi-Annual Payments of Principal and Interest to Noteholders
Makes Residual Payments to Issuer
Noteholders:
Notes Proceeds Remitted to Issuer
- -----------------------
(1) "Ex. Assets" refers to the Existing Assets (including the Potential
Existing Assets).
(2) "Con. Assets" refers to the Construction Assets (including the Potential
Construction Assets).
12
RISK FACTORS
In addition to the other information set forth elsewhere in this
Prospectus, prospective investors should carefully consider the following risk
factors.
Consequences of a Foodmaker Bankruptcy
In the event a bankruptcy case is instituted by or against Foodmaker under
Title 11 of the United States Code (the "Bankruptcy Code"), Foodmaker (assuming
that the CRC Leases are treated as true leases as discussed below), as debtor-
in-possession, or its trustee in bankruptcy, would have the right, subject to
bankruptcy court approval, to assume or reject the Leases. Pending the
assumption or rejection of the Leases, it is possible that some or all of the
payments under the Leases may be interrupted or delayed for a significant
period of time. This would interrupt or delay payments on the Notes. Although
the Leases have been entered into in composite form with respect to each
Construction Asset and/or Existing Asset (a "Property;" the Existing Assets and
the Construction Assets, together, the "Properties"), it is possible that
Foodmaker, as debtor-in-possession, or its trustee in bankruptcy, would assert
the right to assume the Leases with respect to certain of such Properties while
rejecting the Leases with respect to other Properties. Alternatively,
Foodmaker, as debtor-in-possession, or its trustee in bankruptcy, might assert
a right to treat the obligations of Foodmaker to make the Rejectable Exchange
Offer during year nine and at the end of the Basic Term of the Leases, as in
the nature of a purchase obligation separate from its lease obligations and
which could be assumed or rejected in bankruptcy separately from the lease
obligations.
If any Lease were rejected, payments thereunder would terminate, leaving
the applicable Lessor without cash flow to make payments on the Notes. In the
event a lease was rejected, the applicable Lessor (and by virtue of the
Indenture, the Trustee) would have an administrative priority claim for the
unpaid post-bankruptcy rental value of the Properties used by the Lessee and an
unsecured non-priority claim for damages against Foodmaker's bankruptcy estate
but, under Section 502(b)(6) of the Bankruptcy Code, such claim would be
limited to an amount equal to the rent reserved under such Lease, without
acceleration, for the greater of one year or 15% (not to exceed three years) of
the remaining term of the Lease (plus pre-bankruptcy rent already due but
unpaid); if either rejectable offer obligation is not treated as a separate
obligation from the applicable Lease, such limitation could also apply to the
damages recoverable for a breach of such rejectable offer obligation. By
contrast, this limitation under Section 502(b)(6) would not apply to holders of
debt securities issued by Foodmaker. Therefore, if Foodmaker were the subject
of proceedings under the Bankruptcy Code and any Lease were rejected, the
damages that could be claimed for rejection, even assuming full recovery on
such claim (which may not occur), would not be sufficient to repay the Notes.
If Foodmaker assumes the Leases, it would be required to cure or provide
adequate assurances that it would promptly cure any defaults, compensate or
provide adequate assurances that it will promptly compensate for any actual
pecuniary loss caused by such default, and provide adequate assurances of
future performance. Foodmaker also may have the right in a bankruptcy to
assume and assign the Leases without the applicable Lessor's consent, and be
relieved of liability therefor, but only if adequate assurance of future
performance by the assignee is provided.
Moreover, it is possible that a bankruptcy court could treat the
transactions described herein including the Leases not as a leasing transaction
but instead as a secured loan to Foodmaker, in which case the bankruptcy court
could permit Foodmaker to use or dispose of the Properties, subject to
providing "adequate protection" (such as a lien on, substitute collateral) to
the applicable Lessor without the applicable Lessor's consent and/or the
consent of the Trustee and/or the Holders of Notes, and to modify and to
adversely affect the rights of the applicable Lessor and/or the Trustee and/or
the Holders of the Notes, including reduction of the secured amount and
modification of the timing of payments that would otherwise have been payable
by Foodmaker under the Leases (in such event, however, the above-described
limitation under Section 502(b)(6) of the Bankruptcy Code would not be
applicable) and limitations on damages recoverable by a landlord for a tenant's
breach of a lease. The characterization of the transaction as a secured loan
to Foodmaker could also arise under applicable non-bankruptcy law. In case the
transaction is viewed as a secured loan, the remedies available to the Lessors
would be those of a secured creditor, not a landlord. If the applicable Lessor
is treated as a secured creditor without a power of sale, the only remedy may
be to foreclose judicially even in states which permit non-judicial
foreclosure.
13
In the event a bankruptcy case is instituted by or against Foodmaker under
the Bankruptcy Code, Foodmaker, as debtor-in-possession, or its trustee in
bankruptcy would also have the right, subject to bankruptcy court approval, to
reject the Estates For Years in the Properties granted to the applicable Lessor
in which case the applicable Lessor would have an election either to pursue an
unsecured nonpriority claim for damages against Foodmaker's bankruptcy estate
or to remain in possession of the Properties for the balance of the term of the
Estates For Years. It is not certain that the Leases would survive such a
rejection, in which case payments on the Notes could be discontinued. In
addition, it is possible that Foodmaker, as debtor-in-possession, or its
trustee in bankruptcy, would assert ownership interests in the various accounts
established pursuant to the Indenture and that Foodmaker would have the right
to use such accounts subject to providing adequate protection to the Trustee
and/or the Holders of Notes.
The occurrence of any of the foregoing events may have a material adverse
effect on the Holders of Notes.
Management of the Properties Following Termination of the Leases
The transaction documents from the underlying transactions do not include
obligations on the part of Foodmaker to continue to operate the Properties on
behalf of the Issuer, CRC-I or CRC-II as Jack In The Box restaurants after any
termination of the Leases, nor are the Trustee or the Holders of Notes granted
any special franchise, license or similar arrangements to use the Jack In The
Box name or other trademarks or to receive any other services from Foodmaker in
connection with the operation of a restaurant chain.
Food Service Industry
Food service businesses are often affected by changes in consumer tastes,
national, regional, and local economic conditions, demographic trends, traffic
patterns, and the type, number and location of competing restaurants. Multi-
unit food service chains such as Foodmaker can also be substantially adversely
affected by publicity resulting from food quality, illness, injury, or other
health concerns or operating issues stemming from one store or a limited number
of stores. Dependence on frequent deliveries of fresh produce also subjects
food service businesses such as Foodmaker to the risk that shortages or
interruptions in supply caused by adverse weather or other conditions could
adversely affect the availability, quality and cost of ingredients. In
addition, factors such as inflation, increased food, labor, and employee
benefits costs, regional weather conditions, and the unavailability of
experienced management and hourly employees may also adversely affect the food
service industry in general and Foodmaker's results of operations and financial
condition in particular.
Lack of Public Market
Although Old Notes are eligible for trading on PORTAL, there is currently
no established trading market for New Notes, and the Issuer has taken no steps
and does not intend to take steps to facilitate any public trading market for
New Notes. There can be no assurance that a market for New Notes will develop.
If a market for New Notes should develop, no assurance can be given as to the
liquidity of any such market, and New Notes could trade at a substantial
discount from their initial issue price.
THE EXCHANGE OFFER
Purpose of the Exchange Offer
The Exchange Offer is designed to provide Holders of Old Notes with an
opportunity to acquire New Notes which, unlike the Old Notes, will be freely
tradable at all times, subject to any restrictions on transfer imposed by state
securities or "blue sky" laws; provided that the Holder of Old Notes is (i) not
an affiliate or promoter of the Issuer within the meaning of the Securities
Act, (ii) represents that the New Notes are being acquired in the ordinary
course of such Holder's business, and (iii) is not engaged in, and does not
intend to engage in, a distribution of the New Notes.
The outstanding Old Notes, in the aggregate principal amount of
$70 million, were originally issued and sold on January 5, 1994. The original
sale to the Initial Purchasers was not registered under the Securities Act in
reliance upon the exemption provided by Section 4(2) of the Securities Act.
The Old Notes may not be reoffered, resold, or transferred
14
other than pursuant to a registration statement filed pursuant to the
Securities Act or unless an exemption from the registration requirements of the
Securities Act is available.
Pursuant to Rule 144 promulgated under the Securities Act, Old Notes may
generally be resold (a) commencing two years after the date of original
issuance, in an amount up to, for any three-month period, the greater of 1% of
the Old Notes then outstanding or the average weekly trading volume of the Old
Notes during the four calendar weeks immediately preceding the filing of the
required notice of sale with the Commission and (b) commencing three years
after the date of original issuance, in any amount and otherwise without
restriction by a Holder of Old Notes who is not, and has not been for the
preceding 90 days, an affiliate of the Issuer. The Old Notes are eligible for
trading in the Private Offerings, Resales and Trading through Automated
Linkages Market ("PORTAL"), and may be resold to certain Qualified
Institutional Buyers pursuant to Rule 144A promulgated under the Securities
Act. Certain other exemptions may also be available under other provisions of
the federal securities laws for the resale of the Old Notes.
In connection with the original sale of the Old Notes, the Issuer entered
into the Registration Rights Agreement, pursuant to which it agreed to file
with the Commission a registration statement covering the exchange by the
Issuer of New Notes for Old Notes in a transaction designed to provide Holders
of Old Notes with identical New Notes that, with certain limitations, will be
freely tradable. The Registration Rights Agreement provides that the Issuer,
Foodmaker, CRC-I and CRC-II shall (i) cause to be filed with the SEC as soon as
practicable after the date hereof, but in no event later than May 4, 1994, a
registration statement with respect to an offer by the Issuer to each Holder of
Old Notes of the opportunity to exchange their Old Notes for New Notes, and
(ii) use their best efforts to cause (A) such registration statement to be
declared effective, and (B) New Notes to be delivered to the Registrar under
the Indenture for delivery to all Holders of Old Notes who have tendered Old
Notes pursuant to an offer by the Issuer to each Holder of Old Notes of the
opportunity to exchange their Old Notes for New Notes on or prior to
September 4, 1994. The Issuer, Foodmaker, CRC-I and CRC-II shall keep the
registration statement relating to the Exchange Offer continuously effective
for a period of not less than the period required under applicable federal and
state securities laws; provided, however, that (i) the Exchange Offer shall
remain open, and (ii) the registration statement relating to the Exchange Offer
shall remain continuously effective for a period of at least 20 consecutive
business days. In addition, under certain circumstances the Issuer may be
required to file a shelf registration statement covering the Old Notes and to
use its best efforts to cause such registration statement to be declared
effective.
In the event that: (a) the Registration Statement or, if required, a
shelf registration statement is not filed on or prior to May 4, 1994 (the
"Filing Date"); (b) the Exchange Offer is not consummated on or prior to
September 4, 1994 (the "Consummation Date") or the shelf registration
statement, if required, is not declared effective on or prior to August 4, 1994
(the "Effective Date"); (c) in the case of a shelf registration statement, if
required, the Commission issues a stop order suspending the effectiveness of
such shelf registration statement prior to the date which is one year from the
date on which such shelf registration statement was declared effective; or (d)
any Co-Registrant, for the third time, notifies or is required to give notice
of the happening of any event that makes any statement in the shelf
registration statement, if required, untrue in any material respect or that
requires the making of any changes in such shelf registration statement, if
any, so that it will not contain any untrue statement of material fact or omit
to state any material fact required to be stated therein, then the Lessee will
be required to pay, or cause to be paid, in addition to amounts otherwise due
under the Indenture and the Old Notes, as liquidated damages, and not as a
penalty, to each Holder of Notes, an additional amount equal to (a) for each
weekly period beginning on the Filing Date and until the Consummation Date or
the Effective Date, as applicable, $.05 per week per $1,000 principal amount of
the Old Notes held by such Holder and (b) for each weekly period commencing on
the Consummation Date or the Effective Date, as applicable, or thereafter, an
additional amount equal to $.10 per week per $1,000 principal amount of Old
Notes held by such Holder; provided, however, that such liquidated damages
will, in each case, cease to accrue on the date on which the Issuer's
obligations with respect to the Exchange Offer or the shelf registration
statement, as applicable, are satisfied.
The staff of the Division of Corporation Finance of the Commission has
issued certain interpretive letters that concluded, in circumstances similar to
those contemplated by the Exchange Offer, that new debt securities issued in a
registered exchange for outstanding debt securities, which new securities are
intended to be substantially identical to the securities for which they are
exchanged, may be offered for resale, resold and otherwise transferred by the
holders thereof (other than any holder that is an affiliate of the issuer or a
broker-dealer) without compliance with the registration and prospectus delivery
provisions of the Securities Act, provided that the new securities are acquired
in the ordinary course of
15
such holders' business and such holders have no arrangement with any
person to participate in the distribution of the new securities. See "-
Resales of New Notes." The Issuer has not requested or obtained an
interpretive letter from the staff of the Division of Corporation Finance with
respect to this Exchange Offer. However, the Exchange Offer is being conducted
in a manner intended to be consistent with the facts and conditions represented
in such letters. By delivering the Letter of Transmittal, a Holder of Old
Notes tendering Old Notes for exchange will represent and warrant to the Issuer
that the Holder of Old Notes is acquiring the New Notes in the ordinary course
of its business and that the Holder of Old Notes is not engaged in, and does
not intend to engage in, a distribution of the New Notes. Any Holder of Old
Notes using the Exchange Offer to participate in a distribution of the New
Notes to be acquired in the Exchange Offer must comply with the registration
and prospectus delivery requirements of the Securities Act in connection with a
secondary resale transaction. Holders of Old Notes who do not exchange their
Old Notes pursuant to this Exchange Offer will continue to hold Old Notes that
are subject to restrictions on transfer.
It is expected that the New Notes will be freely transferable by the
Holders of New Notes subject to the limitations described in the immediately
preceding paragraph and in "- Resales of New Notes." Sales of New Notes
acquired in the Exchange Offer by Holders of New Notes who are "affiliates" of
the Issuer within the meaning of the Securities Act will be subject to certain
limitations on resale under Rule 144 of the Securities Act. Such persons will
only be entitled to sell New Notes in compliance with the volume limitations
set forth in Rule 144, and sales of New Notes by affiliates will be subject to
certain Rule 144 requirements as to the manner of sale, notice and the
availability of current public information regarding the Issuer. The foregoing
is a summary only of Rule 144 as it may apply to affiliates of the Issuer. Any
such persons must consult their own legal counsel for advice as to any
restrictions that might apply to the resale of their New Notes.
The New Notes otherwise will be identical in all respects (including
interest rate, maturity, security and restrictive covenants) to the Old Notes
for which they may be exchanged pursuant to this Exchange Offer.
Terms of the Exchange Offer
Upon the terms and subject to the conditions set forth herein and in the
accompanying Letter of Transmittal, the Issuer will exchange $500,000 principal
amount of New Notes for each $500,000 principal amount of its outstanding Old
Notes. New Notes will be issued only in integral multiplies of $500,000 to
each tendering Holder of Old Notes whose Old Notes are accepted in the Exchange
Offer.
The New Notes will bear interest from and including July 1, 1994 (the day
after the last date for which interest will have been paid on the Old Notes
prior to the exchange). Accordingly, Holders who receive New Notes in exchange
for Old Notes will forego accrued but unpaid interest on their exchanged Old
Notes for the period from and including July 1, 1994 to the date of exchange,
but will be entitled to such interest under the New Notes.
As of January 5, 1994, $70,000,000 aggregate principal amount of Old Notes
was outstanding. This Prospectus and the Letter of Transmittal are being sent
to all registered Holders of Old Notes. Tendering Holders of Old Notes will
not be required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect to the
exchange of Old Notes pursuant to the Exchange Offer. Foodmaker will pay all
charges and expenses, other than certain transfer taxes which may be imposed,
in connection with the Exchange Offer. See "- Payment of Expenses."
Holders of Old Notes do not have any appraisal or dissenters' rights under
the Delaware Corporation Law in connection with the Exchange Offer.
Expiration Date; Extensions; Termination
The Exchange Offer will expire at midnight, New York City time, on
______________, 1994 (the "Expiration Date"), subject to extension by the
Issuer by notice to the Exchange Agent as herein provided. The Issuer reserves
the right to extend the Exchange Offer at its discretion, in which event the
term "Expiration Date" shall mean the time and date on which the Exchange Offer
as so extended shall expire. The Issuer shall notify the Exchange Agent of any
extension prior to 9:00 A.M., New York City time, on the next business day
after the previously scheduled Expiration Date.
16
The Issuer reserves the right to extend or terminate the Exchange Offer
and not accept for exchange any Old Notes if any of the events set forth below
under "- Conditions to the Exchange Offer" occur and are not waived by the
Issuer, by giving oral or written notice of such delay or termination to the
Exchange Agent. See "- Conditions to the Exchange Offer." The rights reserved
by the Issuer in this paragraph are in addition to the Issuer's rights set
forth below under the caption "- Conditions to the Exchange Offer."
Procedures for Tendering
The acceptance by Holders of Old Notes of the Exchange Offer pursuant to
one of the procedures set forth below will constitute an agreement between such
Holder of Old Notes and the Issuer in accordance with the terms and subject to
the conditions set forth herein and in the Letter of Transmittal.
To be tendered effectively, the Old Notes, together with the properly
completed Letter of Transmittal (or facsimile thereof), executed by the
registered Holder of Old Notes, and any other documents required by the Letter
of Transmittal, must be received by the Exchange Agent at the address set forth
below prior to midnight, New York City time, on the Expiration Date. LETTERS
OF TRANSMITTAL AND OLD NOTES SHOULD NOT BE SENT TO THE ISSUER.
Signatures on a Letter of Transmittal must be guaranteed unless the Old
Notes tendered pursuant thereto are tendered (i) by a registered Holder of Old
Notes who has not completed the box entitled "Special Issuance and Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of any firm
that is a member of a registered national securities exchange or a member of
the National Association of Securities Dealers, Inc. or a commercial bank or
trust company having an office in the United States (an "Eligible
Institution"). In the event that signatures on a Letter of Transmittal are
required to be guaranteed, such guarantee must be by an Eligible Institution.
If the Letter of Transmittal is signed by a person other than a registered
Holder of Old Notes, such Old Note must be endorsed or accompanied by
appropriate bond powers, in either case signed exactly as the name or names of
the registered Holder or Holders appear on the Old Notes. If the Letter of
Transmittal or any Old Notes or bond powers are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, such persons should so
indicate when signing, and, unless waived by the Issuer, proper evidence
satisfactory to the Issuer of their authority to so act must be submitted.
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance of tendered Old Notes will be resolved by the Issuer,
whose determination will be final and binding. The Issuer reserves the
absolute right to reject any or all tenders that are not in proper form or the
acceptance of which would, in the opinion of counsel for the Issuer, be
unlawful. The Issuer also reserves the right to waive any irregularities or
conditions of tender as to particular Old Notes. The Issuer's interpretation
of the terms and conditions of the Exchange Offer (including the instructions
in the Letter of Transmittal) will be final and binding. Unless waived, any
irregularities in connection with tenders must be cured within such time as the
Issuer shall determine. Neither the Issuer nor the Exchange Agent shall be
under any duty to give notification of defects in such tenders or shall incur
liabilities for failure to give such notification. Tenders of Old Notes will
not be deemed to have been made until such irregularities have been cured or
waived. Any Old Notes received by the Exchange Agent that are not properly
tendered and as to which the irregularities have not been cured or waived will
be returned by the Exchange Agent to the tendering Holder of Old Notes, unless
otherwise provided in the Letter of Transmittal, as soon as practicable
following the Expiration Date. The Issuer's acceptance for payment of Old
Notes tendered pursuant to the Exchange Offer will constitute a binding
agreement between the tendering person and the Issuer upon the terms and
subject to the conditions of the Exchange Offer.
THE METHOD OF DELIVERY OF OLD NOTES AND OTHER DOCUMENTS TO THE
EXCHANGE AGENT
IS AT THE ELECTION AND RISK OF THE HOLDER OF OLD NOTES, BUT IF
DELIVERY IS BY
MAIL IT IS SUGGESTED THAT THE MAILING BE MADE SUFFICIENTLY IN
ADVANCE OF THE
EXPIRATION DATE TO PERMIT DELIVERY TO THE EXCHANGE AGENT BEFORE
THE EXPIRATION
DATE.
17
Guaranteed Delivery Procedures
Holders of Old Notes who wish to tender their Old Notes and (i) whose Old
Notes are not immediately available, or (ii) who cannot deliver their Old
Notes, the Letter of Transmittal or any other required documents to the
Exchange Agent prior to the Expiration Date, may effect a tender if:
(a) The tender is made through an Eligible Institution;
(b) Prior to the Expiration Date, the Exchange Agent receives from such
Eligible Institution a properly completed and duly executed Notice of
Guaranteed Delivery (by facsimile transmission, mail or hand delivery) setting
forth the name and address of the Holder of Old Notes, the certificate number
or numbers of such Old Notes and the principal amount of Old Notes tendered,
stating that the tender is being made thereby and guaranteeing that, within
five New York Stock Exchange trading days after the Expiration Date, the Letter
of Transmittal (or facsimile thereof) together with the certificate(s)
representing the Old Notes and any other documents required by the Letter of
Transmittal will be deposited by the Eligible Institution with the Exchange
Agent; and
(c) Such properly completed and executed Letter of Transmittal (or
facsimile thereof), as well as the certificate(s) representing all tendered Old
Notes in proper form for transfer and all other documents required by the
Letter of Transmittal are received by the Exchange Agent within five New York
Stock Exchange trading days after the Expiration Date.
Upon request of the Exchange Agent, a Notice of Guaranteed Delivery will
be sent to Holders of Old Notes who wish to tender their Old Notes according to
the guaranteed delivery procedures set forth above.
Conditions to the Exchange Offer
If, prior to the consummation of the Exchange Offer, (i) any Co-Registrant
determines, based on a written opinion of independent counsel provided to the
Trustee, that (A) the New Notes would not, upon receipt, be transferable by
each Holder of New Notes without restriction under the Securities Act and the
Exchange Act and without material restrictions under applicable "blue sky" or
state securities laws (provided that such Holder of New Notes is not an
affiliate of any of the Co-Registrants, that such New Notes are acquired in the
ordinary course of such Holder of New Notes' business and such Holder of New
Notes has no arrangement with any person to participate in the distribution of
such New Notes), (B) the interests of the Holders of Old Notes, taken as a
whole, would be materially adversely affected by the consummation of an
exchange offer, or (C) the Commission is unlikely to permit the consummation of
an exchange offer, or (ii) the Holders of at least a majority of the then
outstanding aggregate principal amount of the Old Notes request that the Co-
Registrants abstain from consummating an exchange offer based upon a written
opinion of independent counsel provided to the Co-Registrants to the effect
that either (A) the participation of such Holders of Old Notes in an exchange
offer is not legally permitted, or (B) a court decision or administrative
action may be reasonably expected to have a material adverse effect on such
Holders of Old Notes in the event such Holders participate in an exchange
offer, (iii) a request is made by any Holder of Old Notes for, and the Lessee
fails to deliver by the later of (x) the fifteenth day following such request
or (y) the fifteenth day following the Filing Date, an opinion of counsel
reasonably acceptable to such Holder of Old Notes that the exchange of Old
Notes for New Notes pursuant to the Exchange Offer will be a tax-free
transaction for the tendering Holders of Old Notes, or (iv) an exchange offer
is not consummated prior to the Consummation Date, then the Issuer must
promptly deliver to the Holders of Old Notes and the Trustee notice thereof
(the "Exchange Offer Termination Notice") and must thereafter, pursuant to the
Registration Rights Agreement, file with the Commission, and obtain the
effectiveness of, a shelf registration statement pursuant to which the Old
Notes may be resold by the Holders thereof under the Securities Act. If such
shelf registration statement is not filed on or prior to the Filing Date or is
not declared effective by the Commission on or prior to the Effective Date,
then the Issuer will be obligated to pay to Holders the liquidated damages
described above under "- Purpose of the Exchange Offer.".
Notwithstanding any other provisions of the Exchange Offer or any
extension of the Exchange Offer, and in addition to the Issuer's right to
extend, amend or terminate the Exchange Offer at any time in its sole
discretion, the Issuer will not be required to accept for exchange and issue
New Notes in exchange for Old Notes validly tendered and may terminate or amend
the Exchange Offer as provided for in the Exchange Offer or may postpone
(subject to the
18
requirements of the Exchange Act for prompt issuance of or return of Old
Notes) the acceptance for exchange and issuance of New Notes, if at any time on
or after _______________, 1994 and before the acceptance for exchange of any
such Old Notes, any of the following shall have occurred (or shall have been
determined by the Issuer in its sole discretion to have occurred):
(a) There shall be threatened, instituted or pending any action or
proceeding before, or any injunction, order or decree shall have been
issued by, any court or governmental agency or other governmental
regulatory or administrative agency or commission (i) seeking to restrain
or prohibit the making or consummation of the Exchange Offer or any other
transaction contemplated by the Exchange Offer, or assessing or seeking
any damages as a result thereof, or (ii) resulting in a material delay in
the ability of the Issuer to accept for exchange or, in the judgment of
the Issuer, might result in the Holders of the Old Notes having
obligations with respect to resales and transfers of Old Notes that are
greater than those described in "- Resales of New Notes" or would
otherwise in the judgment of the Issuer make it inadvisable to proceed
with the Exchange Offer, provided, however, that the Issuer will use
reasonable efforts to modify or amend the Exchange Offer to take such
other reasonable steps as to make the provisions of this section
inapplicable;
(b) any statute, rule, regulation, order or injunction shall be
sought, proposed, introduced, enacted, promulgated or deemed applicable to
the Exchange Offer or any of the transactions contemplated by the Exchange
Offer by any domestic or foreign government or governmental authority
that, in the sole judgment of the Issuer, might directly or indirectly
result in any of the consequences referred to in Clauses (a)(i) or (a)(ii)
above or, in the sole judgment of the Issuer might result in the Holders
of the Old Notes having obligations with respect to resales and transfers
of Old Notes that are greater than those described in "- Resales of Old
Notes" or would otherwise in the judgment of the Issuer make it
inadvisable to proceed with the Exchange Offer, provided, however, that
the Issuer will use reasonable efforts to modify or amend the Exchange
Offer or to take such other reasonable steps as to make the provisions of
this section inapplicable;
(c) there shall have occurred (i) a declaration of a banking
moratorium or any suspension of payments in respect of banks in the United
States or any limitations by any governmental agency or authority which
adversely affects the extension of credit, or (ii) a commencement of wars,
armed hostilities or other similar international calamity directly or
indirectly involving the United States, or, in the case of any of the
foregoing existing at the time of the commencement of the Exchange Offer,
a material acceleration or worsening thereof;
(d) any change shall have occurred or be threatened in the business,
properties, assets, liabilities, financial condition, results of
operations or prospects of the Issuer that, in the sole judgment of the
Issuer, is or may be materially adverse to the Issuer, or the Issuer shall
become aware of facts that, in the judgment of the Issuer, have or may
have an adverse significance with respect to the value of the Old Notes;
(e) any governmental approval has not been obtained, which approval
the Issuer shall, in its sole discretion, deem necessary for the
consummation of the Exchange Offer as contemplated hereby;
(f) there exists, in the sole judgment of the Issuer, any actual or
threatened legal impediment (including a default or prospective default
under an agreement, indenture or other instrument or obligation to which
the Issuer is a party or by which it is bound) to the consummation of the
transactions contemplated by the Exchange Offer; or
(g) the Holders of at least a majority of the then outstanding
aggregate principal amount of the Old Notes request that the Co-
Registrants abstain from consummating an exchange offer based upon a
written opinion of independent counsel provided to the Co-Registrants to
the effect that either (A) the participation of such Holders of Old Notes
in an exchange offer is not legally permitted, or (B) a court decision or
administrative action may be reasonably expected to have a material
adverse effect on such Holders of Old Notes in the event such Holders
participate in any exchange offer.
The Issuer expressly reserves the right to terminate the Exchange Offer
and not accept for exchange any Old Notes upon the occurrence of any of the
foregoing conditions. In addition, the Issuer may amend the Exchange Offer at
19
any time prior to midnight, New York City time, on the Expiration Date if
any of the conditions set forth above occur. Moreover, regardless of whether
any of such conditions has occurred, the Issuer may amend the Exchange Offer in
any manner which, in its good faith judgment, is advantageous to the Holders.
Any determination made by the Issuer concerning an event, development or
circumstance described or referred to above will be final and binding on all
parties.
Acceptance of Old Notes for Exchange; Delivery of New Notes
Upon the terms and subject to the conditions of the Exchange Offer, the
Issuer will accept all Old Notes validly tendered prior to midnight, New York
City time, on the Expiration Date. The Issuer will deliver New Notes in
exchange for Old Notes promptly following the Expiration Date.
For purposes of the Exchange Offer, the Issuer shall be deemed to have
accepted validly tendered Old Notes when, as and if the Issuer has given oral
or written notice thereof to the Exchange Agent. The Exchange Agent will act
as agent for the tendering Holders of Old Notes for the purpose of receiving
the New Notes. Under no circumstances will interest be paid by the Issuer or
the Exchange Agent by reason of any delay in making such payment or delivery.
In all cases, delivery of New Notes in exchange for Old Notes tendered and
accepted for exchange pursuant to the Exchange Offer will be made only after
timely receipt by the Exchange Agent of (i) certificates ("Certificates") for
such Old Notes or timely confirmation (a "Book-Entry Confirmation") of the book-
entry transfer of the Old Notes into the Exchange Agent's account at The
Depositary Trust Company (the "Book-Entry Transfer Facility"), pursuant to the
procedures set forth in "Procedures for Tendering" above, (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or an Agent's Message (as defined below) in
connection with a book-entry transfer, and (iii) any other documents required
by the Letter of Transmittal.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Exchange Agent and forming a part of
a Book-Entry Confirmation, which states that such Book-Entry Transfer Facility
has received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Old Notes which are the subject of such Book-
Entry Confirmation, that such participant has received and agrees to be bound
by the terms of the Letter of Transmittal and that the Issuer may enforce such
agreement against such participant.
If any tendered Old Notes are not accepted for exchange because of an
invalid tender, the occurrence of certain other events set forth herein or
otherwise, any such unaccepted Old Notes will be returned, at the Issuer's
expense, to the tendering Holder of Old Notes thereof as promptly as
practicable after the expiration or termination of the Exchange Offer.
Withdrawal Rights
Tenders of Old Notes made pursuant to the Exchange Offer are irrevocable
and may not be withdrawn.
20
Exchange Agent
State Street Bank and Trust Company (telephone (617) 985-3023) has been
appointed as Exchange Agent for the Exchange Offer. All correspondence in
connection with the Exchange Offer and the Letter of Transmittal should be
addressed to the Exchange Agent as follows:
By Hand: By Mail: By Overnight By Facsimile:
State Street Bank State Street Bank Express: (617) 985-3034
and and State Street Bank
Trust Company Trust Company and
Corporate Trust Corporate Trust Trust Company
Window, 4th Floor Department Corporate Trust
Two International P.O. Box 778 Department
Place Boston, Two International
Boston, Massachusetts 02102 Place
Massachusetts 02110 Attn: Andrew Boston,
Attn: Andrew Sinasky Massachusetts
Sinasky 02110
Attn: Andrew
Sinasky
Requests for additional copies of the Prospectus or the Letter of
Transmittal should be directed to the Exchange Agent or the Issuer.
Payment of Expenses
Foodmaker will reimburse the Exchange Agent for its reasonable
out-of-pocket expenses in connection with the Exchange Offer. Foodmaker will
also pay all transfer taxes, if any, applicable to the exchange of Old Notes
pursuant to the Exchange Offer. If, however, New Notes, or substitute Old
Notes for principal amounts not exchanged, are to be delivered to, or are to be
registered or issued in the name of, any person other than the registered
Holder of Old Notes tendered hereby, or if tendered Old Notes are registered in
the name of any person other than the person signing the Letter of Transmittal,
or if a transfer tax is imposed for any reason other than the exchange of Old
Notes pursuant to the Exchange Offer, the amount of any such transfer taxes
(whether imposed on the registered Holder of Old Notes or any other person)
will be payable by the tendering Holder of Old Notes. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted herewith, the
amount of such transfer taxes will be billed directly to such tendering Holder
of Old Notes.
Foomaker has not retained any dealer-manager or similar agent in
connection with the Exchange Offer and will not make any payments to brokers,
dealers or others for soliciting acceptances of the Exchange Offer.
Accounting Treatment
The New Notes will be recorded at the same carrying value as the Old
Notes, which is the principal amount, as reflected in the Issuer's accounting
records on the date of the exchange. Accordingly, no gain or loss for
accounting purposes will be recognized. The expenses of the Exchange Offer
will be capitalized by Foodmaker for accounting purposes.
Resales of New Notes
With respect to resales of New Notes, based on interpretive letters
previously issued by the Staff of the Division of Corporation Finance of the
Commission to third parties, the Issuer believes that the New Notes issued
pursuant to the Exchange Offer may be offered for resale, resold and otherwise
transferred by any holder thereof, without complying with the registration and
prospectus delivery provisions of the Securities Act, provided that such holder
(i) is not an "affiliate" or "promoter" (as such terms are defined in Rule 405
under the Securities Act) of the Issuer, (ii) is not participating in a
distribution of the New Notes to be received in the Exchange Offer, (iii) is
not, except as noted below, a broker-dealer and (iv) is acquiring the New Notes
in the ordinary course of such holder's business. Based on the prior
interpretive letters, no broker-dealer may resell or otherwise transfer New
Notes issued pursuant to the Exchange Offer without complying with the
registration requirements of the Securities Act, unless (a) such broker-dealer
is holding Old Notes only as nominee, or (b)(i) such broker-dealer acquired the
Old Notes for its own account as a result of market-making or other trading
activities and undertakes to satisfy certain conditions consistent with the
requirements of the Securities Act,
21
including the delivery of a prospectus which contains a plan of distribution
with respect to such resale transactions (such plan of distribution need not
name the broker-dealer or disclose the amount of New Notes held by the
broker-dealer), and (ii) such broker-dealer has not entered into any
arrangement or understanding with the Issuer or an affiliate of the Issuer to
distribute the New Notes received pursuant to the Exchange Offer. If any
Holder of Old Notes does not satisfy any of the foregoing conditions, such
holder may not be entitled to rely on the previously issued interpretive
letters. If any other Holder of Old Notes is deemed to be an "underwriter"
within the meaning of the Securities Act or acquires New Notes in the
Exchange Offer for the purpose of distributing or participating in a
distribution of the New Notes, such holder must comply with the registration
and prospectus delivery requirements of the Securities Act in connection with
a secondary resale transaction, unless an exemption from registration is
otherwise available. By tendering Old Notes into the Exchange Offer,
registered Holders of Old Notes represent to the Issuer, among other things,
that (a) they are not "affiliates" or "promoters" of the Issuer (as those
terms are defined in Rule 405 under the Securities Act), (b) they are not
engaged in, do not intend to engage in, and have no arrangement or
understanding with any person to participate in, a distribution of the New
Notes to be issued in the Exchange Offer, and (c) are acquiring the New Notes
in the ordinary course of business.
Each broker-dealer that receives New Notes for its own account in exchange
for Old Notes must acknowledge that it will deliver a prospectus in connection
with any resale of such New Notes. The Issuer is under no obligation to
prepare a prospectus for use in connection with such resales.
22
SELECTED UNAUDITED PRO FORMA FINANCIAL DATA
The following selected unaudited pro forma estimate of operations for the
twelve-month period commencing on the date of and giving effect to the following
transactions and events: (i) the sale on January 5, 1994 of $70 million
aggregate principal amount of Notes for $68.9 million; (ii) the concurrent
purchase of CRC Notes with an aggregate principal amount of $70 million for
$68.9 million; and (iii) the recordation of interest income on the CRC Notes and
interest expense on the Notes of $6.9 million each, including amortization of
the original issue discount thereon of $116 thousand. The selected unaudited
pro forma balance sheet contained herein gives effect to the foregoing
transactions and events as if they occurred on December 31, 1993.
The pro forma financial data presented herein do not purport to represent
what the Company's results of operations or financial position would have been
had such transactions in fact occurred at the beginning of the periods or to
project the Company's results of operations in any future period. The Selected
Unaudited Pro Forma Financial Data should be read in conjunction with the
Financial Statements, including the notes thereto, included herein.
UNAUDITED PRO FORMA ESTIMATE OF OPERATIONS
For the Initial Twelve Month Period
Estimated Revenues:
Interest income . . . . . . . . . . . . . . . . . . . . . . . $6,941,000
Estimated Expenses:
Interest expense. . . . . . . . . . . . . . . . . . . . . . . 6,941,000
---------
Pro forma estimated net earnings. . . . . . . . . . . . . . . . $ --
=========
- ----------------------------------------------------------------------------
UNAUDITED PRO FORMA BALANCE SHEET
As of December 31, 1993
-------------------------------------
Pro Forma As
Actual Adjustments Adjusted
-------- ----------- ----------
ASSETS
Cash. . . . . . . . . . . . . . . . $ 100 $ -- $ 100
Long-term notes receivable, net of
discount of $1,092,000. . . . . . -- 68,908,000 68,908,000
------- ---------- ----------
$ 100 $68,908,000 $68,908,100
======= ========== ==========
LIABILITIES AND STOCKHOLDER'S EQUITY
Long-term debt, net of discount
of $1,092,000 . . . . . . . . . . $ -- $68,908,000 $68,908,000
Common stock. . . . . . . . . . . . 100 -- 100
------- ---------- ----------
$ 100 $68,908,000 $68,908,100
======= ========== ==========
23
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND
RESULTS OF OPERATIONS
Results of Operations
[To come after May 15, 1994]
Liquity and Capital Resources
[To come after May 15, 1994]
BUSINESS
The Issuer
General
The Issuer is a special purpose corporation, incorporated in the State of
Delaware on December 22, 1993 for the benefit of Foodmaker in connection with
the transactions described herein. See "Description of the Underlying
Transactions." The purposes of the Issuer are limited to: (i) issuing and
selling the Notes, as principal and as agent for CRC-I and CRC-II, and entering
into the Indenture in connection therewith (the "Financing"); (ii) acquiring,
owning and holding obligations of CRC-I and CRC-II, accounts, investments and
other property to be pledged as collateral for the Notes and pledging such
property as collateral for the Notes; and (iii) engaging in any other
activities that are necessary, suitable, or convenient to accomplish the
matters set forth in the foregoing clauses (i) and (ii). In furtherance of
such limited purposes, the Issuer may not create, incur or assume any
indebtedness other than pursuant to or in connection with the Financing and the
transactions contemplated thereby, or incur, assume, or guarantee the
indebtedness of any person or entity, including, without limitation, pursuant
to any purchase or repurchase agreement, capital lease, indemnity, or any keep-
well, take-or-pay, through-put, or other arrangement having the effect of
assuring or holding harmless any third person or entity against loss with
respect to any obligation of such other person or entity, unless such
indebtedness is an invoice, statement of account, check, work request, purchase
order or other similar document representing expenses relating to the permitted
activities of the Issuer described above. Nor does the Issuer propose to
(i) make loans to other persons, (ii) invest in the securities of other issuers
for the purpose of exercising control, (iii) underwrite the securities of other
issuers, (iv) engage in the purchase and sale of investments, (v) offer
securities in exchange for property, (vi) repurchase or otherwise reacquire its
shares or other securities. The principal executive offices of the Issuer are
located at One Financial Center, 13th Floor, Boston, Massachusetts 02111, and
the Issuer's telephone number is (_____) _____-________.
Employees
Pursuant to the terms of the Indenture, the Issuer does not employ any
employees.
CRC-I
General
CRC-I is a Massachusetts special purpose limited partnership which was
organized solely for the purpose of participating in this Exchange Offer and
the underlying transactions. The original Certificate of Limited Partnership
of CRC-I was filed with the Secretary of State of the Commonwealth of
Massachusetts on December 8, 1993. The latest date upon which CRC-I is to
dissolve is December 31, 2043. The charter documents of CRC-I do not require
it to, nor does it intend to, hold annual meetings. The purposes of CRC-I are
limited to (i) acquiring, owning, holding and selling or otherwise transferring
(subject to the provisions of Section 1.06 of those certain Deeds of Trust and
Mortgages that have been (with respect to the Existing Assets) or will be (with
respect to the Potential Existing Assets) entered into by CRC-I in connection
with the transactions specified in (ii) below) Estates For Years in the CRC-I
Note Property; (ii) the sale of mortgage notes to the Issuer and encumbering,
hypothecating, mortgaging and pledging its interest in the CRC-I Note
Properties owned by it as security for or in partial satisfaction of such
mortgage notes and certain other mortgage notes issued by CRC-II; (iii) leasing
24
the CRC-I Note Properties to Foodmaker pursuant to the terms of a master lease;
and (iv) engaging in any other activities which are necessary to accomplish the
foregoing purposes or are incidental thereto or connected therewith. In
furtherance of such limited purposes, CRC-I is not permitted to create, incur
or assume any indebtedness other than pursuant to or in connection with the
transactions specified in (ii) above and the transactions contemplated thereby,
or incur, assume, or guarantee the indebtedness of any person or entity other
than pursuant to or in connection with the transactions specified in (ii) above
or pursuant to a guaranty of the obligations of the Issuer in connection with
the Notes including, without limitation, pursuant to any purchase or repurchase
agreement, capital lease, indemnity, or any keep-well, take-or-pay, through-
put, or other arrangement having the effect of assuring or holding harmless any
third person or entity against loss with respect to any obligation of such
other person or entity, unless such indebtedness is an invoice, statement of
account, check, work request, purchase order or other similar document
representing expenses relating to the permitted activities of CRC-I described
above. Nor does CRC-I propose to (i) make loans to other persons, (ii) invest
in the securities of other issuers, (iii) underwrite the securities of other
issuers, (iv) engage in the purchase and sale of investments, (v) offer
securities in exchange for property, (vi) repurchase or otherwise reacquire its
shares or other securities. The General Partner of CRC-I is CRC-I Corp. (the
"CRC-I General Partner"), incorporated in the Commonwealth of Massachusetts on
December 8, 1993. The CRC-I General Partner is responsible for the management
of CRC-I, transacts all business for CRC-I and has complete discretion in its
management of all aspects of CRC-I's affairs.
Employees
CRC-I has no operations and does not employ any employees.
CRC-II
General
CRC-II is a Massachusetts special purpose limited partnership which was
organized solely for the purpose of effecting this Exchange Offer and the
underlying transactions. The original Certificate of Limited Partnership of
CRC-II was filed with the Secretary of State of the Commonwealth of
Massachusetts on December 1, 1993. The latest date upon which CRC-II is to
dissolve is December 31, 2043. The charter documents of CRC-II do not
require it to, nor does it intend to, hold annual meetings. The purposes of
CRC-II are limited to (i) acquiring, owning, holding and selling or otherwise
transferring (subject to the provisions of Section 1.06 of those certain
Deeds of Trust and Mortgages entered into by CRC-II in connection with the
transactions specified in (ii) below) Estates For Years in the CRC-II Note
Properties; (ii) selling mortgage notes to the Issuer and encumbering,
hypothecating, mortgaging and pledging its interest in the CRC-II Note
Properties owned by it as security for or in partial satisfaction of such
mortgage notes and certain other mortgage notes issued by CRC-I; (iii)
leasing the CRC-II Note Properties to Foodmaker pursuant to the terms of a
master lease; and (iv) engaging in any other activities which are necessary
to accomplish the foregoing purposes or are incidental thereto or connected
therewith. In furtherance of such limited purposes, CRC-II is not permitted
to create, incur or assume any indebtedness other than pursuant to or in
connection with the transactions specified in (ii) above and the transactions
contemplated thereby, or incur, assume, or guarantee the indebtedness of any
person or entity other than pursuant to or in connection with the
transactions specified in (ii) above or pursuant to a guaranty of the
obligations of the Issuer in connection with the Notes including, without
limitation, pursuant to any purchase or repurchase agreement, capital lease,
indemnity, or any keep-well, take-or-pay, through- put, or other arrangement
having the effect of assuring or holding harmless any third person or entity
against loss with respect to any obligation of such other person or entity,
unless such indebtedness is an invoice, statement of account, check, work
request, purchase order or other similar document representing expenses
relating to the permitted activities of CRC-II described above. Nor does
CRC-II propose to (i) make loans to other persons, (ii) invest in the
securities of other issuers, (iii) underwrite the securities of other
25
issuers, (iv) engage in the purchase and sale of investments, (v) offer
securities in exchange for property, (vi) repurchase or otherwise reacquire
its shares or other securities. The General Partner of CRC-II is CRC-II
Corp. (the "CRC-II General Partner"), incorporated in the Commonwealth of
Massachusetts on November 30, 1993. The CRC-II General Partner is
responsible for the management of CRC-II, transacts all business for CRC-II
and has complete discretion in its management of all aspects of CRC-II's
affairs.
Employees
CRC-II has no operations and does not employ any employees.
26
MANAGEMENT
The Issuer
Directors and Executive Officers
The following table sets forth the name, age and position with the Issuer
of each of the persons designated to serve as directors and executive officers
of the Issuer. Additional information with respect to each such individual is
contained below under "Background of Directors and Executive Officers." Each
Director of the Issuer will hold office until the next annual meeting of
stockholders of the Issuer or until his successor has been elected and
qualified. Officers of the Issuer are elected by the Board of Directors of the
Issuer and serve at the discretion of the Board. Robert H. Key owns all of the
outstanding shares of Common Stock of the Issuer, and has sole voting power
with respect to the election of directors. See, however, "Description of
Underlying Transactions - Corporate Governance Agreement.
Name Age Position(s)
---- --- -----------
Charles W. Duddles 53 President, Treasurer,
Secretary and Director
Charles F. MacGill 71 Director
Background of Directors and Executive Officers
Mr. Duddles has been a director and President, Treasurer and Secretary of
the Issuer since December 1993. Mr. Duddles is also a director, Executive Vice
President and Chief Financial and Administrative Officer of Foodmaker and has
been since at least 1988.
Mr. MacGill is a director of the Issuer and has been since May 1994.
Mr. MacGill is also President and Chairman of the Board of Chartwell
Properties Corporation, a real estate investment company, and has been since
1987.
Executive Compensation
None of the directors or officers of the Issuer receive any compensation
from the Issuer or for their services in these capacities.
OWNERSHIP OF EQUITY SECURITIES
The Issuer
The following table sets forth, as of the date of this Prospectus, the
beneficial ownership of the Issuer's Common Stock.
Name of Beneficial Shares of
Owner Common Stock Percent
------------------- ------------ -------
Robert H. Key 100 100%
27
DESCRIPTION OF THE UNDERLYING TRANSACTIONS
Net Note Sales Proceeds; Closing Costs; Costs of the Estates For Years
On January 5, 1994, in a private placement transaction, the Issuer issued
and sold $70,000,000 aggregate principal amount of Old Notes. The net sales
proceeds from the sale of the Old Notes were $68,908,000, which proceeds were
used to purchase the CRC Notes. The total acquisition cost of the Estates For
Years purchased by CRC-I and CRC-II was $66,427,605 and the closing costs paid
by CRC-I and CRC-II were estimated, at January 5, 1994, to be $2,480,395.
Existing Assets
The CRC-I Note Purchase Price was in the amount of approximately $28.6
million. The proceeds from the sale of the CRC-I Note have been and will be
used by CRC-I to purchase from Foodmaker Estates For Years for terms ending
November 30, 2028 in 38 existing Jack In The Box restaurants consisting of an
aggregate of approximately 101,000 rentable square feet of space and situated
on an aggregate of approximately 19.6 acres of land. The locations of all of
the Existing Assets, including the Potential Existing Assets, are identified in
the Schedule of Properties below.
The full purchase price for the CRC-I Note was paid on January 5, 1994;
however, a portion of such funds has been deposited in the Additional Unit
Acquisition Account (a subaccount of the Construction Account) maintained by
the Trustee pursuant to the Indenture to be disbursed therefrom from time to
time to enable CRC-I to purchase Estates For Years in the Potential Existing
Assets from Foodmaker, as title to the fee interest therein is acquired by
Foodmaker, at which time such Properties will be subjected to the CRC-I Lease.
As of April 15, 1994, Estates For Years in the Existing Assets, other than the
Potential Existing Assets, had been acquired by CRC-I from the proceeds of the
CRC-I Note Purchase Price and were leased to Foodmaker pursuant to the CRC-I
Lease. At June _____, 1994, approximately $__________________ had been
disbursed for the acquisition of such Existing Assets. See "- Construction
Account." Pursuant to the terms of the CRC-I Lease, Foodmaker has been and
will be liable for the payment of rent from January 5, 1994 on all of the
Existing Assets, including the Potential Existing Assets (collectively, the
"CRC-I Note Properties"), regardless of the status of the acquisition by CRC-I
of an Estate for Years therein.
Construction Assets
The CRC-II Note Purchase Price was in the amount of approximately $37.8
million. The proceeds from the purchase of the CRC-II Note have been and will
be used by CRC-II to purchase from Foodmaker Estates For Years for terms ending
November 30, 2028 in four existing Jack In The Box restaurants and
approximately 34 to-be-constructed Jack In The Box restaurant locations
consisting of an aggregate of approximately 101,000 rentable square feet of
space and situated on an aggregate of approximately 19.6 acres of land. The
locations of all of the Construction Assets, including the Potential
Construction Assets, are identified in the Schedule of Properties below.
The full purchase price for the CRC-II Note was paid on January 5, 1994;
however, a portion of such funds has been deposited in the Construction Account
maintained by the Trustee pursuant to the Indenture to be disbursed therefrom
from time to time to enable CRC-II to purchase the Estates For Years in the
Potential Construction Assets from Foodmaker, as title to the fee interest
therein is acquired by Foodmaker (at which time such Properties will be
subjected to the CRC-II Lease), and to enable Foodmaker to build Jack In The
Box restaurants thereon. See "- Construction Account." As of April 15, 1994,
Estates For Years in the Construction Assets, other than the Potential
Construction Assets, had been acquired by CRC-II from the proceeds of the
CRC-II Note Purchase Price and were leased to Foodmaker pursuant to the CRC-II
Lease. At June _____, 1994, approximately $_________________ had been
disbursed for the acquisition of such Construction Assets. Estates For Years
in the Potential Construction Assets will be acquired from time to time and
will be subjected to the CRC-II Lease as Foodmaker acquires the fee interest
and CRC-II acquires the Estate For Years therein. Pursuant to the terms of the
CRC-II Lease, Foodmaker has been and will be liable for the payment of rent
from January 5, 1994 on all of the Construction Assets acquired by Foodmaker
(including the Potential Construction Assets) (collectively, the "CRC-II Note
Properties") regardless of the status of the acquisition by CRC-II of an Estate
For Years therein and/or the completion of construction thereof.
28
The Properties
The usable area of a typical building constructed on a Property consists
of approximately 50% kitchen space and 50% dining space and includes
approximately 20-30 uncovered outdoor parking places. The Properties initially
will be operated as Jack In The Box restaurants.
Schedule Of Properties
Existing Assets (as of April 15, 1994)*
Number Location City State
------ -------- ---- -----
1 465 South Fairfax Los Angeles CA
2 5801 Bellaire Boulevard Houston TX
3 1395 Federal Road Houston TX
4 2101 9th Avenue North Texas City TX
5 4400 West Fuqua Houston TX
6 7447 Spencer Hwy Pasadena TX
7 3333 Red Bluff Pasadena TX
8 8767 South Main Houston TX
9 916 South Sam Houston Drive Huntsville TX
10 839 East Mulberry Street Angleton TX
11 419 South Washington Cleveland TX
12 901 East Curry Road Tempe AZ
13 1402 East Ash Globe AZ
14 41 East Edwardsville Woodriver IL
15 1649 Washington Avenue Alton IL
16 1800 North Illinois Swansea IL
17 1360 Highway 50 O'Fallon IL
18 830 Edwardsville Road Troy IL
19 13369 Firestone Boulevard Norwalk CA
20 315 South Brea Brea CA
21 57930 Twenty Nine Palms Yucca Valley CA
22 11080 Scarsdale Boulevard Houston TX
23 3317 First Street Rosenberg TX
24 15919 JFK Houston TX
25 5107 I-10 Baytown TX
26 15354 Manchester Road Ellisville MO
27 7520 Manchester Maplewood MO
28 322 Taylor Hazelwood MO
29
29 479 Ranier Avenue South Renton WA
* The Existing Assets include the Potential Existing Assets, set forth
separately below.
Potential Existing Assets (as of April 15, 1994)
Number Location City State
------ -------- ---- -----
30 4751 El Cajon Boulevard San Diego CA
31 2701 Brooklyn Avenue Los Angeles CA
32 23813 South Avalon Carson CA
33 2210 North Alexander Baytown TX
34 1010 Richmond Wharton TX
35 1001 North 24th Street Phoenix AZ
36 1180 Highway 20 Cottonwood AZ
37 3330 Nameoki Road Granite City IL
38 300 South Buchanan Edwardsville IL
Construction Assets (as of April 15, 1994)**
Number Location City State
------ -------- ---- -----
1 Slauson & Greenwood City of Commerce CA
2 3830 West Sierra Way Acton CA
3 Hwy 99 & Lander Turlock CA
4 College at Lindbergh Beaumont TX
5 NEC Hwy 290 at Senate Road Houston TX
6 I-10 at Hwy 62 Orange TX
7 Sunshine & Tyler Harlingen TX
8 I-10 at FM 359 Brookshire TX
9 U.S. 83 & Bryan Road Mission TX
10 Tyler at South M Harlingen TX
11 Airline & I-610 Houston TX
12 Hwy 360 & Green Oaks Grand Prarie TX
13 1467 Olney Avenue Port Orchard WA
14 610 South Burlington Burlington WA
Boulevard
15 4717 Evergreen Everett WA
16 20746 108th Avenue Kent WA
** The Construction Assets include the Potential Construction Assets, set
forth separately below.
30
Potential Construction Assets
Number Location City State
------ -------- ---- -----
17 I-8 & Fortuna Yuma AZ
18 Santa Fe & Bobier Vista CA
19 Pico Canyon & Lyons Santa Clarita CA
20 Archibald at I-60 Ontario CA
21 China Lake at College Blvd. Ridgcrest CA
22 Stockdale Hwy at 15 Kern County CA
23 Hwy 14 at Hwy 58 Mojave CA
24 Main Street & Mission Ridge Manteca CA
25 Sam Houston Pkwy & Hammerly Houston TX
26 Woodlands Drive at I-45 The Woodlands TX
27 North 10th & Pecan McAllen TX
28 Nolana Loop & North 2nd McAllen TX
29 I-35 & Del Mar Laredo TX
30 FM 518 & 270 League City TX
31 Silber & I-10 Houston TX
32 State Hwy 146 & IH10 Mont Belvieu TX
33 Westheimer & Hwy 6 Houston TX
34 Hwy 518 & Hwy 582 Friendswood TX
35 Mockingbird Ln & Stemmons Dallas TX
36 State Hwy. 121 & Harwood Bedford TX
37 377 at Loop 820 Haltom City TX
38 Dorsett & I-270 St. Louis MO
The CRC Leases
The terms of the CRC Leases are summarized under "Description of the
Leases" below.
Use of Properties
The Properties will initially be operated as Jack In The Box restaurants,
and will be subject to a use limitation requiring that they be used for
restaurant purposes or other business uses within Foodmaker's principal lines
of business for the three years after January 5, 1994.
Right of Substitution
Foodmaker may effect a substitiution (a "Substitution") of any Property
listed on the Schedule of Properties above with a replacement property
("Substitute Property") in any of the following circumstances: (a) a casualty
or condemnation which Foodmaker determines has rendered the Property
permanently unsuitable for continuation of the then existing
31
business use, (b) Foodmaker determines any Property to be uneconomic for
continuation of the then existing business use, or (c) in the case of Potential
Construction Assets or Potential Existing Assets, prior to being subjected to
the applicable Lease.
The Substitute Property must have a fair market value not less than the
then current fair market value of the Property being substituted at the time of
such substitution, as confirmed by an independent appraisal (or as certified by
Foodmaker in the case of a Substitute Property substituted for a Potential
Construction Asset or Potential Existing Asset prior to being subjected to the
applicable CRC Lease). Foodmaker must (1) convey to CRC-I or CRC-II, as
applicable, an Estate For Years of a duration equal to the then remaining
Estate For Years of the substituted Property, and lease from CRC-I or CRC-II,
as applicable, the Substitute Property and (2) pay all charges incident to such
conveyance of the Substitute Property. Such Substitute Property must also be
encumbered as collateral for the CRC Notes pursuant to a deed of trust which
would, in turn, be pledged as collateral for the Notes. Foodmaker shall
receive a release from the lien of the Indenture, applicable deed of trust and
Lease as it relates to the Property so substituted.
Optional Prepayment
The Issuer may not prepay the Notes at any time, in whole or in part,
during the first five years after January 5, 1994. Thereafter, the Notes may
be prepaid in connection with an Early Termination under the Leases, at par
plus a premium (the "Prepayment Premium") equal to the following percentage of
the principal amount of the Notes to be prepaid: year six - 5.00%, year seven
- - 3.75%, year eight - 2.50%, year nine - 1.25%, and year ten - 0.00%. (See
"Description of the Leases - Early Termination; Lease Modification.")
Mandatory Prepayment
By the beginning of year ten, the outstanding balance of the Notes must be
reduced to $35,000,000 or less. The sinking fund will be applied at the
beginning of year ten to reduce the outstanding debt, and CRC-I and CRC-II will
be obligated to make an additional principal payment equal to the difference
between $35,000,000 and the balance in the sinking fund. This additional
principal payment is required to be covered by the special rent payments and
the purchase price payable under the rejectable offer required to be made by
Foodmaker under the Leases at the beginning of year ten. See "Description of
the Leases - Rejectable Offer Requirements."
Indenture Defaults
The following constitute events of default under the Indenture ("Indenture
Defaults"): (a) failure to pay principal of or interest on the Notes when due;
(b) a material misrepresentation which remains uncured 30 days after notice
thereof, with a reasonable and necessary extension during diligent pursuit of a
cure for those misrepresentations which by their nature cannot be cured within
30 days; (c) bankruptcy events with respect to the Issuer, CRC-I, CRC-II or
Foodmaker which are not dismissed within the applicable cure periods; and
(d) other customary defaults.
Acceleration of Senior Secured Notes
Upon the occurrence of an Indenture Default which is not cured by the
Issuer, CRC-I, CRC-II or Foodmaker, the Trustee will be entitled to accelerate
the principal of the Notes and premium, if any. The Issuer may not foreclose
upon the deeds of trust on Foodmaker's reversionary rights on the Existing
Assets or the Construction Assets unless a default under the CRC Leases (a
"Lease Default") or under the Foodmaker Mortgages (as defined in the Indenture)
has occurred and is continuing.
Limited Recourse
The recourse for repayment of the Notes will be limited to the Note
Collateral, the CRC-I Guaranty and the CRC-II Guaranty (which guaranties are
nonrecourse to the general partners of each of CRC-I and CRC-II). The Issuer
will not have any personal liability with respect to the Notes except for
certain customary nonrecourse exclusions. Similarly, the recourse for
repayment of the CRC Notes will be limited to the CRC Collateral.
32
Construction Account
On January 5, 1994, approximately $28,073,455 was placed in the
Construction Account established pursuant to the Indenture. At April 15, 1994,
such funds, and the reinvestment income thereon, were held in the Construction
Account (including the Additional Unit Acquisition Account) for the purpose of
(a) funding the acquisition by CRC-I of an Estate For Years in the Potential
Existing Assets (unless Foodmaker exercises its right of Substitution and
thereby substitutes another asset for a Potential Existing Asset), and
(b) funding the acquisition by CRC-II of an Estate For Years in, and the
construction by Foodmaker, pursuant to the CRC-II Lease, of a Jack In The Box
restaurant on, each of the Potential Construction Assets (unless Foodmaker
exercises its right of Substitution and thereby substitutes another asset for a
Potential Construction Asset). The funds from the Construction Account
(including the Additional Unit Acquisition Account) are required to be remitted
promptly and in full to Foodmaker as (i) CRC-I acquires an Estate For Years in
each Potential Existing Asset, or (ii) Foodmaker acquires a fee interest and
CRC-II acquires an Estate For Years in each Potential Construction Asset, in an
amount which reflects the land acquisition cost of such asset plus, in the case
of Potential Construction Assets, the estimated cost to construct the
improvements thereon (subject to satisfaction of certain conditions set forth
in the Indenture). Whether or not the funds disbursed from the Construction
Account are sufficient to acquire or complete the Potential Construction
Assets, Foodmaker must complete the improvements on the Construction Assets
once they are acquired. In the event that Foodmaker is able to complete and
deliver the Construction Assets for a total amount less than that amount set
aside in the Construction Account, such excess amount shall be released to
Foodmaker.
If an unremedied Lease Default (as described in "Description of the
Leases - Defaults and Remedies") occurs, the Trustee may, in addition to
exercising its remedies under the Indenture, apply the funds available in the
Construction Account to pay the principal, premium, if any, and accrued
interest on the Notes.
Collection, Administrative Expenses, Sinking Fund and Equity Collection
Accounts
All amounts paid by Foodmaker under the Leases are remitted directly to
the Trustee for deposit in the Collection, Administrative Expenses, Sinking
Fund, and the Equity Collection Accounts established pursuant to the Indenture.
The rent payments are made available for application to payment of interest on
the Notes on each semi-annual Interest Payment Date, for payment or deposit
into the Administrative Expenses Account of $25,000 on each semi-annual
Interest Payment Date under the Indenture for projected Indenture expenses, and
to fund $747,402 semi-annually through year nine into the Sinking Fund Account
to create a source for payment of a portion of the principal payment due at the
end of year nine.
All proceeds of any hazard insurance or condemnation (in excess of
$500,000 for any one Property or $3 million in the aggregate at any time), are
required to be deposited in a separate Proceeds Account held by the Trustee,
and disbursed, as required, to fund the restoration of the damaged or condemned
Property (unless Foodmaker elects to substitute or consummate an Early
Termination of the Property, as herein described, in which case the insurance
or condemnation proceeds shall be released to Foodmaker upon consummation
thereof) except in the event of a Lease Default, in which case such proceeds
will be available to pay principal of and accrued interest on the Notes. See
"Description of the Leases - Defaults and Remedies."
Amounts owed to the applicable Lessor by Foodmaker under the CRC Leases in
connection with any Early Termination, the Rejectable Offer Requirements or the
exercise of any Option by Foodmaker (as described in "Description of the
Leases"), in excess of the sums payable on the Notes, are required to be
deposited in a separate Equity Collection Account and are required to be held
by the Trustee until all sums owing under the Notes have been paid in full.
If an unremedied Lease Default occurs, the Trustee may, in addition to
exercising its remedies under the Indenture, apply the funds in the Collection
Account, the Sinking Fund Account and the Equity Collection Account to pay
principal of and accrued interest on the Notes. In the absence of an Indenture
Default, all excess monies in the Collection Account not required to pay the
principal, premium, if any, and interest on the Notes on a Payment Date will be
free of the lien of the Indenture and may be distributed to the Lessee and/or
the Issuer.
33
No Other Indebtedness or Activities
Neither the Issuer, CRC-I nor CRC-II is permitted to incur additional
indebtedness or to own other assets or engage in other business activities.
Corporate Governance
Each of the Issuer, CRC-I Corp. and CRC-II Corp., and their original
shareholders (the "Shareholders"), Foodmaker, a designated individual who is
both an officer and director of Foodmaker (the "Designated Officer") and an
individual unaffiliated with the Issuer, CRC-I Corp or CRC-II Corp. (the
"Independent Director") have entered into an agreement regarding corporate
governance (the "Corporate Governance Agreement"), which sets forth the
respective rights and responsibilities of the parties with respect to specific
corporate governance issues relating to the Issuer, CRC-I Corp. and CRC-II
Corp. Pursuant to the terms of the Corporate Governance Agreement, the
Shareholders are obligated to elect the Designated Officer (or his successor)
and the Independent Director as the two directors of each of the Issuer, CRC-I
Corp. and CRC-II Corp. The Independent Director and the Designated Officer
have agreed, in their capacities as directors of the Issuer, CRC-I Corp. and
CRC-II Corp., to elect the Designated Officer to all officer positions of each
of the Issuer, CRC-I Corp. and CRC-II Corp.
Foodmaker and the Designated Officer have agreed that the Designated
Officer (or his successor), in the capacity of Designated Officer of the
Issuer, CRC-I Corp. and CRC-II Corp., will not take any of the following
actions without the prior written consent of (i) the holders of 51% or more of
the limited partnership interests in CRC-I or CRC-II, in the case of an action
proposed to be taken by either of CRC-I or CRC-II, (ii) the holders of 51% or
more of the limited partnership interests of each of CRC-I and CRC-II, in the
case of an action proposed to be taken by the Issuer: (a) any waiver,
amendment or consent to a deviation by Foodmaker relating to any of the
Transaction Documents (as defined in the Corporate Governance Agreement to mean
all documents relating to the offer and sale of the Notes and the CRC Leases to
which the Issuer, CRC-I Corp. and/or CRC-II Corp. is a party) to which
Foodmaker is a party; (b) any action to accept or reject the Rejectable Offer
by Foodmaker; or (c) any action which would constitute or result in a breach by
the Issuer, CRC-I Corp. or CRC-II Corp. of any of the Transaction Documents.
The Designated Officer (or his successor) is also obligated to take any other
action on behalf of the Issuer, CRC-I Corp. and CRC-II Corp. upon receipt of
the same written consent requirements noted above, provided that such action is
not in violation of the organizational documents of the Issuer, CRC-I Corp. or
CRC-II Corp. Foodmaker also agreed to take, and agrees to cause the Designated
Officer (or his successor) to take (at Foodmaker's expense), all necessary
action to ensure that the Issuer, CRC-I Corp. and CRC-II Corp. remain at all
times in compliance with the Transaction Documents, and to effectuate transfers
of the limited partnership interests in either CRC-I or CRC-II upon the request
of at least 51% of the holders of the limited partnership interest of the
affected entity.
The Issuer's Certificate of Incorporation provides that its directors
shall not be personally liable to the Issuer or its stockholders for monetary
damages arising as a result of a director's breach of his or her fiduciary
duty.
In addition, the Indenture provides that subject to certain exceptions set
forth therein, neither the Trustee nor the Holders of Notes may seek or obtain
judgment against the Issuer or any of the Issuer's officers, directors,
shareholders or employees for payment of principal or interest under the Notes,
or any sums payable under the Indenture, and the sole recourse of the Trustee
and the Holders of Notes against the Issuer for any default in the payment of
such principal or interest or other sums shall be limited to the Trust Estate.
Trustee
State Street Bank and Trust Company serves as Trustee. The Trustee's fees
will be paid with the funds deposited in the Administrative Expenses Account,
excess funds available in the Collection Account, or through additional rent
payments due under the Leases.
34
Tax Opinion
In connection with the offering of the Old Notes, a legal opinion was
delivered that the Old Notes would be classified as debt of CRC-I and CRC-II
for federal income tax purposes; this opinion did not address any other
federal income tax consequences or other tax consequences related to the
acquisition, ownership or disposition of the Old Notes. The legal opinion was
delivered in reliance upon a Certificate of Representations delivered by
Foodmaker including certain certifications relating to the current value and
projected future value of the Existing Assets and the Construction Assets,
among other things. If the certifications provided by Foodmaker in the
Certificate of Representations were incorrect, then the legal opinion as to
the classification of the Old Notes for federal income tax purposes would be
adversely affected. Purchasers of the Old Notes have been advised that
Foodmaker was not an independent third party to the offering of the Old
Notes, and was not relying on an independent third party, for the purposes of
its Certificate of Representations as to value. The legal opinion was based
on laws, regulations, rulings and decisions in effect at the time, all of
which are subject to change by legislative, administrative or judicial
action, which change may be retroactive. Said legal opinion is not binding
upon the Internal Revenue Service or any court, and no ruling has been
obtained from the Internal Revenue Service as to the classification of the
Old Notes for federal income tax purposes in the transaction. Investors
should consult with their own tax advisors in determining the federal, state,
local and other tax consequences to them of the purchase, ownership and
disposition of the New Notes. See "Certain Federal Income Tax Consequences."
35
DESCRIPTION OF NEW NOTES
The following summary does not purport to be complete and is subject to,
and is qualified in its entirety by, reference to all of the provisions of the
New Notes and the Indenture, including the definitions contained therein of
certain terms and those terms made part of the Indenture by reference to the
Trust Indenture Act of 1939 as in effect on the date of the Indenture. Copies
of the New Notes and the Indenture may be obtained upon request from the
Issuer. Capitalized terms used herein and not otherwise defined in this
Prospectus have the meanings ascribed to them in the Indenture.
To the extent that holders of Old Notes do not participate in the Exchange
Offer and Old Notes remain outstanding after the consummation of the Exchange
Offer, Old Notes and New Notes will be repurchased and/or redeemed pro rata
pursuant to the repurchase and redemption provisions contained therein and in
the Indenture. In addition, Holders of New Notes and Holders of Old Notes,
together, will have the voting rights, rights to comply with notice provisions
and other rights specified in the Indenture.
General
The New Notes will be senior secured obligations of the Issuer, limited in
aggregate principal amount to $70,000,000, secured by certain property and
assets as described below and sometimes referred to herein as the "Collateral."
References herein to the "Collateral Documents" include all documents entered
into to create or perfect the security interests in the Collateral. The New
Notes will bear interest at the rate of 9.75% per annum, payable in cash semi-
annually on the first business day of January and July of each year, commencing
on January 2, 1995 to Holders of Notes at the close of business on the previous
business day. Interest will be computed on the basis of a 360-day year of
twelve 30-day months and the actual number of days elapsed. The New Notes will
rank pari passu with any Old Notes that remain outstanding.
The New Notes will be issued only in fully registered form, without
coupons, in denominations of $500,000 and integral multiples thereof.
Security for the New Notes; Guaranties
The New Notes will be secured by, among other things, the following
(collectively, the "Note Collateral"): (1) The pledge by the Issuer to the
Trustee of the CRC-I Note and the CRC-II Note and the CRC Collateral; and (2) A
pledge of the Issuer's rights in and to the Collection Account, the
Construction Account, the Sinking Fund Account and the Equity Collection
Account (see "Description of the Underlying Transactions - Construction Account
- - Collection, Administrative Expenses, Sinking Fund and Equity Collection
Accounts") as well as certain other accounts to be maintained by the Trustee
pursuant to the Indenture, and all funds held therein.
If an unremedied Lease Default occurs, the Trustee may, in addition to
exercising its remedies under the Indenture, apply the funds in the
Construction Account, the Collection Account, the Sinking Fund Account and the
Equity Collection Account to pay principal of and accrued interest on the
Notes. In the absence of an Indenture Default, all excess monies in the
Collection Account not required to pay the principal, premium, if any, and
interest on the Notes on a Payment Date will be free of the lien of the
Indenture and may be distributed to the Lessee and/or the Issuer.
The New Notes will also be guaranteed by each of CRC-I and CRC-II which
guaranties will be nonrecourse to the general partners of each of CRC-I and
CRC-II.
The Issuer is required, at its expense, to maintain insurance policies
providing for title insurance for each property that is subject to the CRC
Mortgages and the Foodmaker Mortgages, collectively and severally.
Optional Prepayment
The Issuer may not prepay the Notes at any time, in whole or in part,
during the first five years after January 5, 1994. Thereafter, the Notes may
be prepaid in connection with an Early Termination under the Leases, at par
plus a premium (the "Prepayment Premium") equal to the following percentage of
the principal amount of the Notes to be
36
prepaid: year six - 5.00%, year seven - 3.75%, year eight - 2.50%, year
nine - 1.25%, and year ten - 0.00% (see "Description of the Leases - Early
Termination; Lease Modification.")
Mandatory Prepayment
By the beginning of year ten, the outstanding balance of the Notes must be
reduced to $35,000,000 or less. The sinking fund will be applied at the
beginning of year ten to reduce the outstanding debt, and CRC-I and CRC-II will
be obligated to make an additional principal payment equal to the difference
between $35,000,000 and the balance in the sinking fund. This additional
principal payment is required to be covered by the special rent payments and
the purchase price payable under the rejectable offer required to be made by
Foodmaker under the Leases at the beginning of year ten. See "Description of
the Leases - Rejectable Offer Requirements."
Certain Covenants
The Indenture contains certain covenants with respect to the Issuer. The
covenants include, but are not limited to, the following:
Limitation on Use of Proceeds
The Indenture provides that the Issuer will use the proceeds from the sale
of the Old Notes solely for the purposes set forth therein and not for the
purchase of any security that constitutes "margin stock" or "margin securities"
within the meaning of Regulations G, T, U or X of the Board of Governors of the
Federal Reserve System (or any successor regulations thereto). See "-
Limitations on Lines of Business" and "Business - The Issuer."
Limitations on Additional Indebtedness
The Indenture provides that the Issuer will not incur or have outstanding
any indebtedness, or incur, assume, or guarantee the indebtedness of any Person
(including, without limitation, pursuant to any purchase or repurchase
agreement, any indemnity, or any keep-well, take-or-pay, through-put, or other
arrangement having the effect of assuring or holding harmless any third Person
against loss with respect to any obligation of such other Person) other than
pursuant to the Indenture, unless such indebtedness is an invoice, statement of
account, check, work request, purchase order or other similar document
representing expenses relating to permitted activities of the Issuer in
accordance with the terms of the Indenture.
Change of Control
The Indenture provides that the Issuer shall not cause, permit or
acquiesce in any sale, transfer, assignment or other disposition of the
interests of the shareholders in the Issuer which would result in a transfer,
cumulatively, of 49% or more of the shareholder interests in the Issuer.
Limitation on Liens
The Indenture provides that the Issuer will not (a) permit the validity or
effectiveness of the Indenture or any Grant thereunder to be impaired, or
permit the lien of the Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any
covenants or obligations with respect to the Indenture or the Notes or any
document executed pursuant thereto, except as may be expressly permitted
thereby; (b) permit any lien, charge, adverse claim, security interest,
mortgage or other encumbrance (other than the lien of the Indenture and any
lien for taxes not yet due and payable) to be created on or extend to or
otherwise arise upon or burden the Trust Estate or any part thereof, any
interest therein or the proceeds thereof, or (c) take any action that would
permit the lien of the Indenture not to constitute a valid first priority
perfected security interest in the Trust Estate.
37
Existence of Issuer
The Indenture provides that the Issuer will maintain in full force and
effect its existence, rights and franchises as a corporation, organized under
the laws of the State of Delaware, separate and apart from any of its
Affiliates, and will obtain and preserve its qualification to do business as a
foreign corporation, in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of the Indenture,
the Notes or the Trust Estate. The Issuer may not amend its certificate of
incorporation or by-laws without the written consent of the Majority
Noteholders. The Issuer at all times will be operated in accordance with the
provisions of its certificate of incorporation, by-laws and any laws or
regulations applicable to it, and shall observe all corporate formalities,
including keeping its own separate books and records, having its own bank
accounts and keeping its funds separate from the funds of its shareholders,
holding periodic meetings of its directors and shareholders, and having
officers that (when acting in their capacity as officers of the Issuer) act in
such corporation's best interests, and is able to fund from its own assets all
of its activities and expenses. The charter and by-laws of the Issuer provide
that a unanimous vote of all directors of the Issuer is necessary for (a) any
merger or consolidation, (b) any voluntary bankruptcy filing and any
declaration of insolvency for any purpose for the Issuer, or (c) any amendment
of the Issuer's charter, or of its by-laws if such amendment pertains to
certain matters, including, but not limited to, limitations on lines of
business and certain negative covenants, as set forth in the Indenture.
Limitation on Transactions with Affiliates
The Indenture provides that the Issuer will not enter into or permit to
exist, directly or indirectly, any transaction (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any Affiliate of the Issuer, except for transactions in the
ordinary course of the business of the Issuer and upon fair and commercially
reasonable terms which are no less favorable to the Issuer than would be
obtained in a comparable arm's-length transaction with a Person that is not
such an Affiliate.
Protection of Trust Estate
The Indenture provides that the Issuer shall from time to time execute and
deliver all such supplements and amendments hereto and all such financing
statements, continuation statements, instruments of further assurance and other
instruments, and shall take such other action as may be necessary or, upon
request of the Trustee or the Majority Noteholders, advisable to: (a) grant
more effectively all or any portion of the Trust Estate; (b) maintain or
preserve the lien (and the priority thereof) of the Indenture or to carry out
more effectively the purposes thereof; (c) perfect, publish notice of, or
protect the validity of any Grant made or intended to be made by the Indenture;
(d) enforce any of the Mortgage Note Documents, Eligible Investments, or other
instruments included in the Trust Estate, or the CRC Leases; (e) preserve and
defend title to the Trust Estate and the rights therein of the Trustee and the
Holders of Notes in such Trust Estate against the claims of all Persons and
parties; and (f) pay any and all taxes levied or assessed upon all or any part
of the Trust Estate.
The Indenture further provides that the Trustee shall not (a) remove any
portion of the Trust Estate that consists of money or is evidenced by an
instrument, certificate, or other writing including, without limitation, the
CRC Notes, (i) from the jurisdiction in which it was held at the date the most
recent Opinion of Independent Counsel was delivered pursuant to the Indenture
(or from the jurisdiction in which it was held as described in the Opinion of
Independent Counsel, delivered on January 5, 1994), if no Opinion of
Independent Counsel has yet been delivered pursuant to the Indenture or
(ii) from the possession of the Person who held it on such date or (b) cause or
permit ownership or the pledge of any portion of the Trust Estate to be
recorded on the books of a Person (i) located in a different jurisdiction from
the jurisdiction in which such ownership or pledge was recorded at such date or
(ii) other than the Person on whose books such ownership or pledge was recorded
at such date, unless the Trustee shall have first received an Opinion of
Independent Counsel to the effect that the lien and perfected first priority
security interest created by the Indenture with respect to such property will
continue to be maintained after giving effect to such action or actions.
Pursuant to the Indenture, the Issuer shall pay or cause to be paid any
taxes levied on the Issuer on account of the Issuer's ownership of the Trust
Estate.
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Opinions as to Trust Estate
The Indenture provides that on or before December 31 in the third calendar
year following January 5, 1994 and on December 31 in each third year
thereafter, the Issuer shall furnish to the Trustee an Opinion of Independent
Counsel either (a) stating that, in the opinion of such counsel, such action
has been taken with respect to the recording, filing, re-recording and refiling
of the Indenture, any indentures supplemental thereto and any other requisite
documents as is necessary to maintain the lien and perfected first priority
security interest created by the Indenture with respect to the Trust Estate and
reciting the details of such action, or (b) stating that, in the opinion of
such counsel, no such action is necessary to maintain such lien and perfected
first priority security interest. Such Opinion of Independent Counsel shall
also describe the recording, filing, re-recording, and refiling of the
Indenture, any indentures supplemental thereto and any other requisite
documents that will, in the opinion of such counsel, be required to maintain
the lien and perfected first priority security interest of the Indenture with
respect to the Trust Estate. The fees and expenses incurred in connection with
each such Opinion of Independent Counsel shall be Administrative Expenses
payable in accordance with the terms of the Indenture, and any such fees and
expenses not so paid shall be paid by the Trustee, to the extent funds are
available from the Trust Estate or are otherwise provided to the Trustee, on
behalf of the Issuer subject to the Trustee's right of reimbursement therefor.
Performance of Obligations
The Indenture provides that the Issuer shall not take any action, and will
use its best efforts not to permit any action to be taken by others, that would
release any Person from any of such Person's covenants or obligations under the
Mortgage Note Documents or the CRC Leases or under any instrument included in
the Trust Estate or which would result in the amendment, hypothecation,
subordination, termination, or discharge of, or impair the validity or
effectiveness of, any of the Mortgage Note Documents, the CRC Leases or any
such instrument, except as provided in the Indenture or such Mortgage Note
Document, the CRC Leases or other instrument.
Limitation on Mergers or Consolidations
The Indenture provides that the Issuer generally may not consolidate or
merge with or into any other Person or convey or transfer its properties and
assets to any Person.
Limitation on Lines of Business
The Indenture provides that the Issuer shall not engage in any business or
activity other than: (a) issuing and selling the Notes pursuant to the
Indenture and acquiring, owning, and pledging the Trust Estate in accordance
with the terms of the Indenture; (b) issuing or incurring indebtedness
permitted by the terms of the Indenture (see "- Certain Covenants - Limitations
on Additional Indebtedness"); and (c) engaging in any other activities which
are necessary, suitable, or convenient to accomplish the matters set forth
above or are incidental thereto or connected therewith. The organizational
documents of the Issuer provide that the Issuer is restricted to engaging only
in such business or activities.
Limitations on Transfer and Encumbrance of Trust Estate
The Indenture provides that the Issuer will not sell, transfer, exchange,
or otherwise dispose of, or pledge, mortgage, hypothecate, or otherwise
encumber (or permit such to occur or suffer such to exist), any part of the
Trust Estate, except as expressly permitted by the Indenture.
Limitation on Payment of Taxes
The Indenture provides that the Issuer will not claim any credit on, or
make any deduction from, the principal or interest payable with respect to the
Notes (other than the amounts required to be withheld in accordance with the
Code) or assert any claim against any present or future Holders of Notes, by
reason of the payment of any taxes levied or assessed upon any part of the
Trust Estate.
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Restrictions on Issuer's Exercise of Lessor's Rights Under Leases
The Indenture provides that the Issuer shall not exercise any right of the
Lessor under either of the CRC Leases (including, without limitation, any right
to make any election or determination or give any consent, direction, or waiver
under such CRC Lease) without the prior written approval of the Trustee, all of
which rights are assigned to the Trustee by virtue of the CRC Lease
Assignments, including the collateral assignments thereof by the Issuer to the
Trustee. To the extent any such consent may not be unreasonably withheld by
the applicable Borrower under the applicable CRC Lease, the Trustee and the
Holders of Notes shall be bound by such reasonableness standard.
Limitation on Status as Investment Company
The Indenture provides that the Issuer shall at all times while the Notes
are outstanding take all actions necessary to ensure that the Issuer is at all
times exempt from and need not register as an "investment company" under the
Investment Company Act, and shall at no time allow itself to be controlled by
an "investment company" as defined in the Investment Company Act.
Restriction on Purchase of Notes
The Indenture provides that the Issuer may not acquire any Notes.
Reports and Other Information
Provision of Rule 144A Information
During the period beginning on the original issuance date of the Old Notes
and ending on the date that is three years from such date, the Issuer shall,
during any period in which the Lessee or the Issuer is not subject to
Section 13 or 15(d) under the Exchange Act, make available to any Holder of Old
Notes which continue to bear the restrictive legend set forth in the Indenture,
and to any prospective purchaser of Old Notes from such Holder, the information
required pursuant to Rule 144A(d)(4) under the Securities Act upon the request
of such holder of Old Notes.
Statement as to Compliance
Promptly upon request by the Trustee or any Noteholder, the Issuer will
deliver to the Trustee an Officer's Certificate stating, as to each signer
thereof, that:
(a) a review of the activities of the Issuer during the preceding
six-month period and of the Issuer's performance under the Indenture has
been made under his or her supervision; and
(b) to the best of his or her knowledge, based on such review, the
Issuer has fulfilled all of its obligations under the Indenture and the
Mortgage Note Documents throughout such six-month period, has complied
fully with the terms and provisions hereof and no Default exists
thereunder, or, if there has or had been a Default during such quarter,
specifying each such Default known to him and the nature and status
thereof.
Payment Date Statement
The Issuer is required under the Indenture to prepare a statement (the
"Payment Date Statement") not later than the second business day preceding each
Payment Date. Upon request by the Trustee, the Issuer shall provide or cause
the Lessee to provide the Trustee with all information not in the Trustee's
possession and necessary to prepare each Payment Date Statement in a timely
manner. The Trustee shall forward copies of the Payment Date Statement to each
Holder of Notes on each Payment Date and the Trustee shall not be liable for
any error made in calculating or otherwise determining the information required
to be set forth in the Payment Date Statement as set forth in the Indenture,
except for any error resulting from negligence, willful misconduct, or bad
faith on the part of the Trustee or its employees. Pursuant to the terms of
the Indenture, the Issuer is required to indemnify the Trustee for any loss,
liability or expense incurred without
40
negligence, willful misconduct or bad faith on the part of the Trustee or
its employees arising out of the Trustee's preparation and delivery of the
Payment Date Statement and disbursements made pursuant thereto.
Events of Default and Remedies
The Indenture defines an "Event of Default" as one of the following
events: (a) the occurrence and continuance of any CRC Lease Event of Default
or Mortgage Event of Default (see "Description of the Leases - Defaults and
Remedies"); (b) the failure by the Issuer to pay any interest, premium or
principal on any Note or to make any deposit required under the Notes to be
made to the Sinking Fund Account or the Administrative Expenses Account, when
due and payable; (c) the failure by the Issuer to perform or observe any other
term, provision, covenant, obligation, or agreement of the Indenture and,
subject to certain exceptions, the continuance of such failure for a period of
30 days from the earlier of actual knowledge thereof by any Responsible Issuer
Officer or written notice thereof to the Issuer by the Trustee or to the Issuer
and the Trustee by any Noteholder; (d) if any representation, warranty or
certification made by or on behalf of the Issuer in or pursuant to the
Indenture or by the Issuer in or pursuant to any other document entered into by
the Issuer or in connection with any of the transactions contemplated by the
Indenture or any other document entered into by the Issuer in connection with
any of the transactions contemplated by the Indenture shall prove to have been
false or incorrect on the date as of which made and such breach remains uncured
30 days after notice thereof has been given to the Issuer or after the
expiration of any reasonable and necessary extension (which shall not be for
more than 90 days) given by the Trustee for those misrepresentations which by
their nature cannot be cured in 30 days and which Issuer is diligently
proceeding to cure; (e) certain events of bankruptcy, insolvency,
reorganization or similar proceedings in respect of the Issuer, CRC-I, CRC-II,
Foodmaker or any General Partner; or (f) default by any party under the
Registration Rights Agreement.
If an Event of Default occurs and is continuing, the Majority Noteholders
may declare the principal of all the Notes to be immediately due and payable by
written notice to the Issuer and the Trustee, and upon any such declaration
such principal, together with interest accrued thereon and any premium payable
in connection therewith, shall become immediately due and payable; provided
that if an Event of Default specified in clause (e), above, occurs, then such
principal, together with interest accrued thereon and any premium payable in
connection therewith shall become immediately due and payable without any such
declaration, demand, presentment or notice or any other action (all of which
are waived) and references herein to "declaration of acceleration" shall
include such automatic acceleration.
At any time after such a declaration of acceleration of Maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee, the Majority Noteholders, by written notice to the
Issuer and the Trustee, may rescind and annul such declaration and the
consequences thereof if: (a) the Issuer has paid or irrevocably deposited with
the Trustee on behalf of the Noteholders a sum sufficient to pay: (i) all
overdue installments of interest, premium, if any, and principal on all Notes;
(ii) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements, and advances, if any, of the Trustee and
its agents and counsel; and (iii) all sums payable to Noteholders pursuant to
the terms of the Indenture and the reasonable compensation, expenses,
disbursements, and advances of their counsel; and (b) all Events of Default,
other than the non-payment of the interest on or principal of Notes that have
become due solely by such acceleration, have been cured or waived as provided
in the Indenture.
Subject to certain provisions of the Indenture regarding the impairment or
waiver of specified rights of a Holder of Notes, (including, but not limited
to, the right to receive payment of the principal, premium, if any, or interest
on or after the Payment Dates expressed in such Notes), no Holder of Notes
shall have any right to institute any Proceedings, judicial or otherwise, with
respect to the Indenture, or for the appointment of a receiver or trustee, or
for any other remedy thereunder, unless, among other things:
(a) the Holders of not less than 25% in Aggregate Outstanding Amount
of Notes shall have made written request to the Trustee to institute
Proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(b) such Holder or Holders of Notes have offered to the Trustee
reasonable indemnity;
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(c) the Trustee for 30 days after its receipt of such notice,
request, and offer of indemnity has failed to institute any such
Proceeding; and
(d) no direction inconsistent with such written request has been
given to the Trustee during such 30-day period by the Majority
Noteholders.
In the event the Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Holders of Notes, neither
group constituting the Majority Noteholders, the Trustee in its sole discretion
may determine what action, if any, shall be taken.
Modification of the Indenture
The Indenture provides that the Trustee and the Issuer may enter into an
indenture or indentures supplemental to the Indenture for the purpose of adding
any provisions to, or changing or eliminating any of the provisions of the
Indenture or of modifying the rights of the Holders of Notes under the
Indenture, except in certain circumstances that will require unanimous consent,
including without limitation (i) changes with respect to payment of principal,
premium and interest (upon redemption, maturity or otherwise), (ii) the
creation of any lien ranking prior to or on a parity with the lien of the
Indenture with respect to any part of the Trust Estate, and (iii) termination
of the lien of the Indenture.
The Indenture also provides that the Issuer and the Trustee may amend or
supplement the Indenture or the Notes without the consent of or notice to the
Holders of Notes to, among other things, (i) provide for the issuance of the
New Notes to be exchanged for Old Notes pursuant to a Registered Exchange Offer
(as defined in the Registration Rights Agreement, (ii) cure any ambiguity,
defect or inconsistency, (iii) make any change that does not materially and
adversely affect the legal or other rights of any Holder of Notes or
(iv) comply with any requirements of the Commission in connection with the
qualification of the Indenture under the Trust Indenture Act of 1939, and the
rules and regulations promulgated thereunder.
The Indenture further provides that the provision regarding the withdrawal
of funds from the Sinking Fund Account shall not be amended or supplemented
without the prior written consent of Foodmaker.
Satisfaction and Discharge of the Indenture
The Indenture will be discharged and the liens Granted thereunder will
cease and the Issuer will be relieved of all obligations thereunder, provided
no Default or Event of Default has occurred and is continuing, except as to
(i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) the rights of Holders of
Notes to receive payments of principal and interest, (iv) the rights,
obligations and immunities of the Trustee thereunder, and (v) the rights of
Holders of Notes as beneficiaries with respect to the property deposited with
the Trustee and payable to all or any of them; and the Trustee, on demand of
and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of the Indenture (except as limited
above), when:
(1) all Notes theretofore authenticated and delivered (subject to certain
exceptions set forth in the Indenture) have been paid in full;
(2) the Issuer has paid or caused to be paid in full all other sums
payable under the Indenture; and
(3) the Issuer has delivered to the Trustee an Officer's Certificate and
Opinion of Counsel stating that all conditions precedent to the satisfaction
and discharge of the Indenture with respect to the Notes have been complied
with.
Concerning the Trustee
The Indenture provides that, except during the continuance of an Event of
Default, the Trustee will perform only such duties as are specifically set
forth in the Indenture. The Majority Noteholders will have the right to direct
the time, method and place of conducting any Proceeding for any remedy
available to the Trustee or any right, remedy, trust or power conferred on the
Trustee, subject to certain exceptions. The Indenture provides that following
an Event of Default
42
and acceleration of the indebtedness incurred under the Indenture, the
Trustee will be required, in the exercise of its power, to use the same degree
of care and skill as a prudent person would exercise or use under similar
circumstances in the conduct of such person's own affairs. Subject to certain
provisions of the Indenture, the Trustee will be under no duty to exercise any
of its rights or powers under the Indenture at the request of any Holder of
Notes, unless such holder shall have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request.
The Indenture and the TIA contain certain limitations on the rights of the
Trustee, should it become a creditor of the Issuer, to obtain payment of claims
in certain cases or to realize on certain property received in respect of any
such claim as security or otherwise. Subject to the TIA, the Trustee will be
permitted to engage in other transactions, provided that if the Trustee
acquires any conflicting interest as described in the TIA it must eliminate
such conflict or resign.
Certain Definitions
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as any other terms used herein for which no definition is
provided.
"Administrative Expenses": Without duplication, the sum of: (a) amounts
due the Trustee under Section 6.7; (b) expenses incurred by the Trustee
relating to the administration and maintenance of the Trust Estate (including,
without limitation, expenses pursuant to Article Eleven); (c) any fees and
expenses, other than fees and expenses paid in connection with the issuance of
the Notes, due to the respective counsel of the Noteholders and the Trustee;
(d) amounts due to Noteholders pursuant to Section 5.14(c) and, with respect to
any Issuer or Borrower solicitation, Section 8.1; and (e) any fees and expenses
payable to the Rating Agencies other than in connection with the issuance of
the Notes.
"Affiliate" of any specified Person: (a) Any other Person controlling or
controlled by or under common control with such specified Person and (b) any
partner of such Person if such Person is a partnership, or any shareholder of
such Person if such Person is a corporation. For the purposes of this
definition, "control," when used with respect to any specified Person, means
the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract, or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Aggregate Outstanding Amount": The aggregate principal amount of all the
Notes outstanding at the date of determination.
"Authorized Officer": With respect to the Issuer, any Person whose name
and specimen signature appears on a list of Authorized Officers furnished to
the Trustee as certified by the Secretary of the Issuer. With respect to the
Trustee or any other bank or trust company acting as trustee of an express
trust or as custodian, a Responsible Officer. With respect to the Lessee, any
Person whose name and specimen signature appears on a list of Authorized
Officers furnished to the Trustee as certified by the Secretary of the Lessee.
"Code": The Internal Revenue Code of 1986, as amended, or any successor
statute(s).
"Eligible Investments": Any one or more of the following obligations or
securities:
(a) (i) negotiable certificates of deposit, having a maturity of no
more than 30 days, of any Depository Institution or trust company (including
the Trustee) incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by federal or state
banking authorities so long as the commercial paper or the short term unsecured
debt obligations of such Depository Institution or trust company (or, in the
case of the principal Depository Institution in a holding company system, the
commercial paper or short term unsecured debt obligations of such holding
company) at the time of such investment or contractual commitment providing for
such investment have a short term credit rating by the Rating Agencies at least
equivalent to AA for Standard and Poor's and Aa for Moody's and (ii) any other
negotiable certificate of deposit having a maturity of not more than 30 days
that is fully insured by the Federal Deposit Insurance Corporation;
43
(b) and, with respect to funds held in the Sinking Fund Account
only, the following additional obligations or securities:
(i) direct obligations of, and obligations fully guaranteed by, the
United States of America, the Federal National Mortgage Association and
the Federal Home Loan Mortgage Corporation or any agency or
instrumentality of the United States of America the obligations of which
are backed by the full faith and credit of the United States of America,
provided that obligations of, or obligations fully guaranteed by, the
Federal National Mortgage Association (excluding stripped mortgage-backed
securities that are valued greater than par on the portion of unpaid
principal), the Federal Home Loan Mortgage Corporation, or any such agency
or instrumentality shall be Eligible Investments only if, at the time of
investment they have a credit rating equal to or higher than AA;
(ii) repurchase obligations pursuant to a written agreement with
respect to (A) any security described in clause (a) above, or (B) any
other security issued or guaranteed by an agency or instrumentality of the
United States of America and providing for the transfer of such security
to the Trustee or its agent as contemplated by applicable law and
regulation in such a way that the Trustee will have a perfected security
interest, in either case entered into with a Depository Institution or
trust company (acting as principal) described in clause (a)(i) above;
(iii) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States of
America or any state thereof that have a short term credit rating by the
Rating Agencies at least equivalent to AA at the time of such investment
or contractual commitment providing for such investment; or
(iv) commercial paper issued by any Depository Institution, or any
corporation incorporated under the laws of the United States of America or
any state thereof, so long as the issuer of such commercial paper has, at
the time of such investment, a credit rating by the Rating Agencies
equivalent to at least AA;
provided that all Eligible Investments shall be held in the name of the
Trustee, in its capacity as such, and further provided that Eligible
Investments purchased with funds in any trust account established and
maintained by the Trustee hereunder shall be held until maturity (except as
otherwise provided in the Deposit Accounts Security Agreements) and shall
include only such obligations or securities as mature no later than the
Business Day prior to (x) the Year Nine Installment Payment Date in the case of
Eligible Investments purchased with funds in the Sinking Fund Account, or
(y) the next Payment Date in the case of Eligible Investments purchased with
funds in the Construction Account.
"General Partner": With respect to CRC-I, CRC-I Corp., a Massachusetts
corporation, and with respect to CRC-II, CRC-II Corp., a Massachusetts
corporation.
"Grant": To grant, bargain, sell, warrant, alienate, demise, release,
convey, assign, transfer, mortgage, charge, pledge, create and grant a security
interest in and right of set-off against, deposit, set over, and confirm. A
Grant of the CRC Notes and the other Mortgage Note Documents, or of any other
instrument or agreement Granted hereunder, shall include all rights, powers,
privileges, remedies, options and other benefits (but none of the obligations)
of the Granting party thereunder, including without limitation the immediate
and continuing right to claim for, to collect, to receive and to give any
receipt for principal, premium, if any, and interest payments in respect of the
CRC Notes and all other monies and other property payable thereunder or in
respect thereof, to give and to receive notices and other communications, to
make waivers or other agreements, to exercise all rights, powers, privileges,
remedies, options and other benefits, to bring Proceedings in the name of the
Granting party or otherwise, and generally to do and to receive anything that
the Granting party is or may be entitled to do or to receive thereunder or with
respect thereto.
"Independent": When used with respect to any specified Person, means such
a Person who (a) is in fact independent of the Issuer, the Lessee, CRC-I,
CRC-II and of any Affiliate of any thereof, (b) does not have any direct
financial interest or any material indirect financial interest in the Issuer,
the Lessee, CRC-I, CRC-II or in any Affiliate of any thereof, and (c) is not
connected with the Issuer, the Lessee, CRC-I, CRC-II or any Affiliate of any
thereof as an officer, employee, promoter, underwriter, trustee, partner
(whether general or limited), director, shareholder, beneficiary or Person
performing similar functions or having similar ownership interests. Whenever
it is provided herein that any
44
Independent Person's opinion or certificate shall be furnished to the
Trustee, such Person shall be appointed by Issuer Order and such opinion or
certificate shall state that the signer has read this definition and that the
signer is Independent within the meaning hereof. "Independent" when used with
respect to any accountant shall include an accountant who audits the books of
any Person referred to in clause (a) above if, in addition to satisfying the
criteria set forth above, the accountant is independent with respect to such
Person within the meaning of Rule 101 of the Code of Ethics of the American
Institute of Certified Public Accountants.
"Installment Payment Date": The first business day of each January and
July, from and including July, 1994 through and including July, 2003.
"Majority Noteholders": The Holders of more than 50% of the Aggregate
Outstanding Amount of the Notes.
"Maturity": With respect to any Note, the date on which the entire unpaid
principal of and interest on such Note becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration pursuant to the terms of Section 5.2 or otherwise pursuant to the
terms of this Indenture.
"Mortgage Note Documents": The meaning specified in the Mortgages.
"Officer's Certificate": A certificate signed on behalf of any Person by
an Authorized Officer of such Person.
"Opinion of Independent Counsel": A written opinion, in form and
substance reasonably satisfactory to the Trustee, addressed to the Trustee and
the Noteholders, of a law firm which shall be Independent and which shall be
reasonably satisfactory to the Trustee.
"Payment Date": With respect to each semi-annual installment or deposit
payable under the Notes, each Installment Payment Date, and with respect to the
final payment or deposit at Maturity, the Stated Maturity specified in the
Notes.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization, or
government or any agency or political subdivision thereof.
"Proceeding": Any suit in equity, action at law, or other judicial or
administrative proceeding.
"Responsible Issuer Officer": Any officer of the Issuer, including any
president, vice president, secretary, treasurer, assistant vice president,
assistant secretary, assistant treasurer or any other officer of the Issuer
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively or to whom any matter is
referred because of his or her knowledge of, or familiarity with, this
Indenture or the transactions contemplated hereby.
"Responsible Officer": When used with respect to the Trustee, any officer
within the Corporate Trust Office of the Trustee (or any successor group of the
Trustee) including any vice president, assistant vice president, assistant
secretary, or any other officer of the Trustee customarily performing functions
similar to those performed by the persons who at the time shall be such
officers, and to whom any corporate trust matter relating to the transactions
contemplated by the provisions of this Indenture is referred because of his or
her knowledge of, or familiarity with, the particular subject.
"Trust Estate": All of the Issuer's right, title and interest now owned
or hereafter acquired in, to and under all of (but none of its obligations with
respect to any of) its assets, whether now existing or hereafter coming into
existence, including, without limitation, (a) the CRC Notes, the CRC-I Lease
Assignment, the CRC-II Lease Assignment, the CRC-I Mortgages, the CRC-II
Mortgages, the Foodmaker Mortgages, the Deposit Accounts Security Agreements,
and the Financing Statements, and all other Mortgage Note Documents, including,
without limitation, any collateral that may be acquired by foreclosure or deed
in lieu of foreclosure and all proceeds of or to which the Issuer is entitled
under any of the foregoing, including without limitation, Insurance and
Condemnation Proceeds, Liquidation Proceeds and all income from REO Properties;
(b) all funds from time to time held in the Collection Account, including
Reinvestment Income (if any) thereon; (c) all funds from time to time held in
the Construction Account, including Reinvestment Income thereon; (d) all
45
funds from time to time held in the Proceeds Account, including
Reinvestment Income (if any) thereon; (e) all funds from time to time held in
any REO Account, including Reinvestment Income thereon; (f) all funds from time
to time held in the Administrative Expenses Account, including Reinvestment
Income (if any) thereon; (g) all funds from time to time held in the Closing
Costs Account, including Reinvestment Income (if any) thereon; (h) all funds
from time to time held in the Sinking Fund Account, including Reinvestment
Income thereon; (i) all funds from time to time held in the Equity Collection
Account, including Reinvestment Income thereon; (j) all funds from time to time
held in the Additional Unit Acquisition Account, including Reinvestment Income
thereon; (k) the Insurance Policies; (l) other contracts or agreements of the
Issuer; (m) all other property, real or personal, tangible or intangible; and
(n) all proceeds of any of the foregoing of every kind and nature whatsoever,
including without limitation, proceeds of proceeds, and the conversion,
voluntary or involuntary, of any of the foregoing into cash or other property
(including, but not limited to, any Eligible Investments).
"Trustee": State Street Bank and Trust Company, and its successors in
interest and any corporation resulting from or surviving any consolidation or
merger to which it or its successors may be a party or any successor trustee at
the time serving as successor trustee as permitted hereunder.
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DESCRIPTION OF THE LEASES
Concurrently with the acquisition by CRC-I of the Estate For Years in the
Existing Assets (other than the Potential Existing Assets), CRC-I leased such
Existing Assets to Foodmaker pursuant to the CRC-I Lease. Similarly,
concurrently with the acquisition by CRC-II of the Estate For Years in the
Construction Assets (other than the Potential Construction Assets), CRC-II
leased such Construction Assets to Foodmaker pursuant to the CRC-II Lease. The
Existing Assets, other than the Potential Existing Assets, and the Construction
Assets, other than the Potential Construction Assets, may hereinafter be
referred to as the "Leased Properties" or, individually, as a "Leased
Property." As CRC-I acquires the Estates For Years in the Potential Existing
Assets, upon the acquisition by Foodmaker of the fee interest in the locations
thereof (subject to Foodmaker's right of Substitution as it relates to the
Potential Existing Assets, as described in "- Right of Substitution"), the
CRC-I Lease will be amended to subject such Potential Existing Assets to the
CRC-I Lease. Likewise, as CRC-II acquires the Estate For Years in the
Potential Construction Assets, upon the acquisition by Foodmaker of the fee
interest in the locations thereof (subject to Foodmaker's right of Substitution
as it relates to the Potential Construction Assets, as described in "- Right of
Substitution"), the CRC-II Lease will be amended to subject such Potential
Construction Assets to the CRC-II Lease.
Properties and Aggregate Net Rentable Building Area
The Properties are located in six states: Arizona, California, Illinois,
Missouri, Texas and Washington. These assets have been and will be initially
operated as Jack In The Box restaurants and have been and will be subject to
use limitations requiring that they be used for restaurant purposes, or other
business uses within Foodmaker's principal lines of business, for three years
commencing on January 5, 1994. There are approximately 202,000 square feet of
net rentable retail space (which includes kitchen, dining and food storage
space).
Basic Term and Renewal Options
The CRC Leases became effective on January 5, 1994 and extend for an
initial period expiring on November 1, 2003 (the "Basic Term"). Provided that
the Notes are repaid and the Note Collateral is released from the lien of the
Indenture, Lessee may exercise, separately and independently with respect to
each Property, four successive renewal terms ("Renewal Terms") of five years
each (except that the Renewal Term will be six years with regard to those
Properties in which the Estates for Years have been purchased by Lessee
pursuant to the Year Nine Offer), plus a fifth renewal term ending November 30,
2028, exercisable by written notice to Lessor no later than 30 days after the
date Lessor delivers to Lessee a valid Year Nine Rejection Notice or Rejection
Notice pursuant to the terms of the CRC Leases and no later than 180 days prior
to the expiration of each Renewal Term thereafter.
Rental Rates
The CRC Leases require Foodmaker to pay the amount of $6,875,000 per year
in the aggregate for all of the Properties, payable in arrears in two equal
semi-annual installments through the end of year nine of the Basic Term, each
of which is due on or before the last business day of June and December in
every year of the Basic Term commencing on the last business day of June, 1994
("Basic Rent"). This payment will adjust in the case of an Early Termination
(as defined below) of a Property to reflect the principal reduction under the
terms of the CRC Notes. Foodmaker is liable for the full Basic Rent payment
relating to the CRC-I Note Properties and the CRC-II Note Properties commencing
on January 5, 1994 regardless of the status of acquisition of the Potential
Existing Asset or the Potential Construction Assets or construction of the
Construction Assets.
With each semi-annual payment of Basic Rent, the Lessee will also be
obligated to make a special rent payment in arrears in the amount of $747,402
through year nine, which payment will be paid directly to Trustee on behalf of
CRC-I or CRC-II (as applicable) and will be deposited in the Sinking Fund
Account (the "Special Rent"). In addition, at the beginning of year ten (i.e.,
the first business day of January, 2003) the Lessee will be obligated to make a
special rent payment in an amount equal to the difference between $23,000,000
and the balance on deposit in the Sinking Fund Account. The foregoing semi-
annual special rent payment of $747,402 and the special rent payments equal to
the difference between $23,000,000 and the balance in the Sinking Fund Account
at the beginning of year ten will adjust in the case of the Early Termination
of any Property.
47
All amounts which Lessee is required to pay or discharge pursuant to the
Lease in addition to Basic Rent and Special Rent (including every fee, charge,
overdue interest and cost which may be added for nonpayment or late payment
thereof) shall constitute additional rent ("Additional Rent").
Maintenance Repairs and Alterations
At its own expense, Lessee shall keep the Leased Properties in good order,
condition and repair, ordinary wear and tear or loss by fire or other casualty
excepted, and in compliance with all Legal Requirements and Environmental Laws,
subject to certain rights to contest set forth in the Leases.
Lessee, at its sole cost and expense, may make alterations and
improvements to the Leased Properties without Lessor's prior consent, free and
clear of liens, provided that the alterations or improvements do not diminish
the value of such properties.
Title to alterations and improvements vests in Lessor subject to the term
of the Estates For Years. Title to Trade Fixtures (as defined in the Lease)
and other personal property and operating equipment of Lessee remains with
Lessee and Lessee may remove its Trade Fixtures and other personal property and
operating equipment at any time during the term of the Leases, provided that
Lessee repairs any damage to the Leased Properties resulting from such removal.
Utilities and Taxes
During the term of the Leases, Lessee must pay for all utility,
communication and other services furnished to the Leased Properties to the
extent rendered or used on or about such properties. Lessee must also pay all
real property taxes and any general and special assessments subject to certain
rights to contest set forth in the Leases. Lessee is not obligated to pay
taxes levied against Lessor unless those taxes are in lieu of any tax or
assessment that would be payable by the Lessee under the Leases. Lessee must
pay all taxes, assessments, license fees and other charges that are levied or
assessed against its personal property and Trade Fixtures.
Insurance
The Leases obligate Lessee to maintain standard fire and extended coverage
insurance, including endorsements for vandalism, malicious mischief, business
interruption and sprinkler leakage (herein "All Risks Insurance"), on the
Leased Properties covering all replacements and additions thereto and all
building materials and other property which constitute part of such properties
in a manner consistent with insurance maintained by Lessee on properties
similar to such properties and in any event in amounts not less than the actual
replacement cost of such properties, excluding land cost and other uninsurable
items and with deductibles customarily maintained by Lessee. Lessee is also
required to maintain comprehensive general liability insurance, including
blanket contractual liability in the minimum amount of $5,000,000 per
occurrence for bodily injury and/or property damage. Lessee is required to
obtain insurance from insurance companies with a General Policy Rating of
"A:VIII" or better in Best's Key Rating Guide and a Standard and Poor's
Corporation rating of "B+" or better or a Moody's Investors Service, Inc.
rating of Ba3 or better. Lessor's insurance policy rights will be assigned to
the Trustee and the Trustee will be named as an additional insured with respect
to such policies. The minimum limits of the required insurance will in no way
limit the liability of lessee under the Leases.
Indemnification
Lessee must indemnify and hold the Indemnified Parties harmless from any
and all claims resulting from Lessee's use of the Leased Properties or
otherwise relating to such properties during the term of the Leases.
Furthermore, Lessee must provide indemnification to each Indemnified Party for
any and all environmental contamination or damage which occurs prior to the
expiration of the Leases. Lessee is required to remediate any environmental
contamination in accordance with applicable laws.
48
Damage, Destruction or Condemnation
If a Leased Property is totally or partially destroyed by fire or other
casualty, or is subject to a taking by a governmental authority pursuant to
condemnation or other like action, Lessee must restore the Leased Property to
substantially its previous condition, whether or not the insurance or
condemnation proceeds are sufficient to cover the cost of restoration, unless
Lessee elects to effect a Substitution or an Early Termination. Lessee may not
terminate the Leases and is not entitled to an abatement of rent (except for
rental adjustments resulting from an Early Termination) in the event of such
damage, destruction or condemnation. Insurance or condemnation proceeds in
excess of $500,000 for any one Leased Property or $3,000,000 in the aggregate
at any time shall be held by the Trustee and disbursed in progress payments as
the work of restoration progresses, or, if Lessee elects a Substitution or
Early Termination, upon consummation of such Substitution or Early Termination.
Right of Substitution
Lessee may effect a Substitution of any Property with a Substitute
Property in any of the following circumstances: (i) a casualty or condemnation
which, upon the sole determination of Lessee, renders the Leased Property
permanently unsuitable for continuation of the then existing business use,
(ii) Lessee determines any Leased Property to be economically infeasible for
continuation of the then existing business, or (iii) in the case of the
Potential Construction Assets or Potential Existing Assets, prior to being
subjected to the applicable Lease.
The Substitute Property must have a fair market value not less than the
then current fair market value of the Property subject to the applicable Lease
as confirmed by an independent appraisal (or as certified by Foodmaker in the
case of a Substitute Property substituted for a Potential Construction Asset or
Potential Existing Asset prior to being subjected to the applicable Lease) at
the time of such Substitution. Foodmaker must (i) convey to the applicable
Lessor an Estate For Years of a duration equal to the then remaining Estate For
Years of the substituted Property and lease-back from Lessor the Substitute
Property in accordance with the terms of and for the remaining term of the
applicable Lease, and (ii) pay all charges incident to such conveyance of the
Substitute Property. Such Substitute Property must also be encumbered as
collateral for the CRC Notes pursuant to a deed of trust which would, in turn,
be pledged as collateral for the Notes.
Foodmaker shall receive a release from the lien of the Indenture, the
applicable deed of trust and Lease as it relates to the Property so submitted.
Early Termination; Lease Modification
At any time after the first business day of January, 1999, Lessee shall
have the right to effect an Early Termination with respect to any Property from
the applicable Lease. In order to do so, the Lessee must initially make a
"Special Sinker Rent" payment of 23/35ths of the "Termination Value" for the
Property. (The "Termination Value" is equal to that Property's initial
allocated portion of the applicable CRC-I or CRC-II original note balance.)
The Lessee must then make an offer to purchase the Property for a price which
is no less than the Termination Value of such Property plus the Termination
Premium thereon (equivalent to the Prepayment Premium applicable to the CRC
Notes) minus the "Special Sinker Rent" payment. These payments will be made
directly to the Trustee and applied as prepayments under the CRC Notes. The
applicable Lessor may reject this offer only if it counteroffers with a higher
price and only if it has prepaid the applicable portion of the applicable CRC
Note plus the prepayment premium. (See "Terms of the Transaction - Payments at
Option of the Issuer.") No further "Special Sinker Rent" is due once payments
of "Special Sinker Rent" in the aggregate amount of 23/70ths of the Termination
Values of all Properties have been made.)
Upon any Early Termination, the Basic Rent and Special Rent payments due
under the applicable Lease shall be adjusted to reflect the reduction in the
principal balance of the applicable CRC Note. Foodmaker shall receive a
release from the lien of the Indenture, the applicable deed of trust and Lease
as it relates to the property so terminated. Foodmaker will also be entitled
to apply a portion of the Sinking Fund Account balance to the "Special Sinker
Rent" payment due under the CRC Leases.
49
Under the terms of the Indenture, the Lessors may neither alter nor
terminate the Leases before the expiration of the Basic Term under the Leases.
Assignment/Subletting; Surrender
Lessee may sublease all or any part of the Leased Properties to
subtenants. The term of the sublease may not extend beyond the then current
term of the Leases. Any subletting by Lessee shall not relieve Lessee of any
of its obligations under the Leases. Lessee may assign its rights and
obligations under either Lease provided there is no default and such an
assignment shall not operate to release Lessee from its obligations under the
Leases. The Leases provide that all of their provisions will bind the parties
and their respective permitted successors and assigns.
Surrender or mutual cancellation of the Leases will, at Lessor's option,
operate as an assignment to it of any or all approved subleases or
subtenancies.
Defaults and Remedies
Lease Defaults by Lessee are defined in the Leases to include:
(i) failure to pay rent for all of the Properties under each of the CRC-I Lease
and the CRC-II Lease when due; (ii) failure to observe or perform any covenants
or provisions of the Leases, where such failure is not cured within thirty (30)
days after written notice from Lessor of such failure (or such additional
period of time as may be reasonable to cure the same with reasonable
diligence); (iii) the making by Lessee of any general assignment for the
benefit of creditors, filing by Lessee of any bankruptcy petition or a filing
against Lessee of any bankruptcy petition which is not dismissed within sixty
(60) days, the appointment of a trustee or receiver to take possession of
Lessee, Lessee's interest in any Property or all or a substantial part of
Lessee's other assets or the attachment or levy upon Lessee's interest in any
Property which is not discharged within sixty (60) days; (iv) a final judgment
for payment in excess of $1,000,000 is rendered against but not remitted by
Lessee within sixty (60) days of such judgment (subject to Lessee's right to
appeal such judgment and post a stay bond); (vi) an acceleration of Lessee's
obligations under any single indebtedness or capital lease in excess of
$25,000,000 or under more than one indebtedness or capital lease in the
aggregate amount of $50,000,000 has occurred.
Upon a Lease Default, subject to applicable state laws, Lessor has the
following rights: (i) to accelerate Lessee's obligation to make the Rejectable
Offers described below, in which case the purchase price payable shall be not
less than the Termination Values of all Properties covered thereby, plus the
Termination Premium applicable thereto (See "Description of the Underlying
Transactions - Optional Prepayment "), (ii) to terminate Leases and recover
damages for default; and (iii) to continue the Leases in effect and recover
rent and all other payments as they become due. The transaction documents
include certain limitations on the ability of the Lessor to terminate the
Leases and recover payments due from Lessee in an amount in excess of the
difference between (A) the Termination Values of all Properties covered
thereon, plus the Termination Premium applicable thereto and (B) the fair
market value of the Estates For Years for the Properties covered by the
applicable Lease for the remaining term of such Estates For Years.
Rejectable Offer Requirements
During year nine, the Leases require that the Lessee must make an
irrevocable offer to purchase CRC-I's and CRC-II's Estates For Years in
Properties having an aggregate Termination Value (i.e., the portion of the
original principal balance of the CRC Notes allocable to each such Property) of
at least 50% of the Termination Values of all Properties initially covered by
the CRC Leases (i.e., $35,000,000). The purchase price for those Properties
having Termination Values not in excess of $35,000,000 will be no less than
12/35ths of their Termination Values plus 100% of the Termination Values in
excess of $35,000,000. The purchase price (a minimum of $12,000,000) plus the
balance on deposit in the Sinking Fund Account plus the special rent payments
due during year nine which, combined with the Sinking Fund balance, will equal
$23,000,000, will produce a source of payments sufficient to discharge
$35,000,000 (50% of the original balance) of the Notes. (See "Terms of the New
Notes - Payments of Principal and Interest Prior to Maturity; the Sinking Fund"
and "Description of the Leases - Rental Rates.") The above figures will adjust
as a result of any Early Termination prior to the beginning of year ten,
because Termination Values paid to the Lessor prior to that time will reduce
the Lessee's obligation to make the rejectable offer during year nine.
50
Under the Leases, Lessee must also at the end of the Basic Term make an
irrevocable offer to purchase the Estate For Years in the remaining Properties
covered thereby for a purchase price at least equal to the Termination Values
of such Properties. This payment shall be sufficient to pay the remaining
principal balance due under the CRC Notes on November 1, 2003. Each such
irrevocable offer is referred to herein as a "Rejectable Offer." The
Rejectable Offer amounts will be reduced to the extent Foodmaker exercises its
option to purchase (described below) some or all of the Estates For Years.
If Lessor accepts the Rejectable Offers, the applicable Estates For Years
must be conveyed to Lessee in accordance with the provisions in the Leases and
the purchase price under the Rejectable Offers shall be delivered to the
Trustee for payment of the principal and interest then due under the Notes.
Pursuant to the terms of the Leases, the applicable Lessor has the right
to reject each Rejectable Offer. However, pursuant to the terms of the
Indenture, the applicable Lessor may only reject each Rejectable Offer provided
Lessor shall deposit with Trustee cash in the amount necessary to pay the
principal and interest then due under the Notes. Should Lessor reject any
Rejectable Offer, Lessee may elect to exercise any one of the following options
on a Property-by-Property basis:
(1) Terminate the Lease as of the last day of the Basic Term.
(2) Extend and renew the Lease pursuant to the Renewal Options.
(3) Elect to merge its reversionary interest with the Estate For Years in
such Property, in which event either the Lessee will purchase the applicable
Lessor's Estate For Years or the applicable Lessor will purchase the Lessee's
reversionary interest in such Property at the prices designated in the Lease.
Right of First Refusal and Option Right
Lessee shall have the right and option, exercisable within 15 business
days, to elect to purchase one or more of the applicable Lessor's Estate For
Years in the Properties if the applicable Lessor receives a bona fide written
offer to purchase the Properties and if Lessor intends to accept such an offer.
Exercise of such right and option shall not affect the deed of trust
encumbering such Property as security for the CRC Notes, nor shall such right
apply to a foreclosure sale; but provided no Lease Default is continuing such
right shall remain exercisable after a foreclosure sale. There shall be no
merger of the lessee's leasehold estate and the Estate For Years on account of
any such acquisition of an Estate For Years.
Lessee shall have an option to purchase at the beginning of year ten the
applicable Lessor's Estate For Years in one or more Properties having
Termination Values not in excess of 50% of the Termination Values of all the
Properties. The option price will equal the fair market value of the relevant
Estate For Years provided that it must be not less than 12/35 of the
Termination Values of such Properties. CRC-I and CRC-II will be obligated to
make an additional principal payment equal to the difference between
$35,000,000 and the balance in the sinking fund which will be covered by the
Special Rent payments due at the beginning of year ten. Lessee shall also have
an option to purchase the applicable Lessors' Estate For Years in one or more
of the Properties on the last day of the Basic Term or the last day of any
Renewal Term or Extended Term. The option price will equal the Fair Market
Value of the relevant Estate For Years, provided that if the option is
exercised on or about the last day of the Basic Term, the Option price shall
not be less than the Termination Values of the Remaining Properties. Exercise
of either such option shall not affect the deed of trust encumbering such
Property as security for the CRC Notes, but provided no Lease Default is
continuing, such options shall remain exercisable after a foreclosure sale.
Certain Definitions
Set forth below is a summary of certain of the defined terms used in the
Leases. Reference is made to the Leases for a full definition of all such
terms, as well as any other terms used herein for which no definition is
provided.
"Environmental Laws": Means the Resource Conservation and Recovery Art
(42 U.S.C. 6901 et seq.), as amended by the Hazardous and Solid Waste
Amendments of 1984, the Comprehensive Environmental Response,
51
Compensation and Liability Act (42 U.S.C. 9601 et seq.), as amended by
the Superfund Amendments and Reauthorization Act of 1986, the Hazardous
Materials Transportation Act (49 U.S.C. 1801 et seq.), the Toxic Substances
Control Act (15 U.S.C. 2601 et seq.), the Clean Air Act (42 U.S.C. 9402 et
seq.), the Clean Water Act (33 U.S.C. 1251 et seq.), the Federal Insecticide,
Fungicide and Rodenticide Act (7 U.S.C. 136 et seq.), the Occupational Safety
and Health Act (29 U.S.C. 651 et seq.) and all applicable federal, state and
local environmental laws, including obligations under the common law,
ordinances, rules, regulations, private agreements (such as covenants,
conditions and restrictions), orders, consent decrees, judgments, permits,
licenses, authorizations, codes and publications, as any of the foregoing may
have been or may be from time to time amended, supplemented or supplanted, and
any other federal, state or local laws, including obligations under the common
law, ordinances, rules, regulations, private agreements (such as covenants,
conditions and restrictions) and publications, now or hereafter existing
relating to regulation or control of Hazardous Substances or environmental
health and safety.
"Indemnified Party": Means each of Lessor, Lessor's Mortgagee, the
Indenture Trustee, each Holder of Notes and their respective Affiliates,
directors, officers, employees, successors and assigns.
"Legal Requirements": Means all laws, rules, orders, ordinances,
regulations and requirements now or hereafter enacted or promulgated, of every
government and municipality having jurisdiction over Lessee or the Leased
Properties and of any agency thereof, relating to Lessee or the Leased
Properties, or the improvements, or the facilities or equipment thereon or
therein, or the streets, sidewalks, curbs and gutters adjoining the Leased
Properties, or the appurtenances to such Properties, or the franchises and
privileges connected therewith, including without limitation the Americans with
Disabilities Act and Environmental Laws, all rules, orders and regulations of
the National Board of Fire Underwriters or other body exercising similar
functions in connection with the prevention of fire or the correction of
hazardous conditions which apply to the Leased Properties, and all private
covenants, conditions and restrictions affecting such properties.
"Rejection Notice": Written notice of Lessor's rejection of the
Termination Date Offer.
"Sinking Fund Account": Means the sinking fund account established and
maintained by the Trustee pursuant to the Indenture.
"Year Nine Rejection Notice": Written notice of Lessor's rejection of the
Year Nine Offer.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
An exchange of an Old Note for a New Note pursuant to the Exchange Offer
should not be treated as a material change in the terms of the Old Notes. As a
result, each New Note should be treated as a continuation of the corresponding
Old Note. An exchanging holder's holding period for a New Note should include
its holding period for the Old Note. In addition, the holder would not
recognize any gain or loss, and its basis and other tax attributes with respect
to the New Note would be the same as its basis and other tax attributes with
respect to the Old Note. The Exchange Offer will result in no federal income
tax consequences to a nonexchanging holder of Old Notes.
The preceding discussion summarizing certain federal income tax
consequences of the Exchange Offer reflects the opinion of Gibson, Dunn &
Crutcher, counsel to the Issuer, as to material federal income tax consequences
expected to result from the Exchange Offer. The discussion is for general
information only and does not constitute tax advice. Each holder should
consult its own tax adviser as to these and any other federal income tax
consequences of the Exchange Offer as well as any tax consequences to it under
state, local or other law. This summary is based on the current provisions of
the Internal Revenue Code of 1986, as amended, and applicable Treasury
regulations, judicial authority and administrative pronouncements. Those
consequences could be modified by future changes in the relevant law, which
could have retroactive effect.
LEGAL MATTERS
The validity of New Notes offered hereby will be passed upon for the
Issuer by Gibson, Dunn & Crutcher, San Diego, California.
52
EXPERTS
The balance sheet of the Issuer as of December 31, 1993, included in the
Prospectus and Registration Statement has been included herein in reliance on
the report of KPMG Peat Marwick, independent certified public accountants,
appearing elsewhere herein, and upon the authority of said firm as experts in
accounting and auditing. The consolidated financial statements of Foodmaker as
of October 3, 1993 and September 27, 1992 and for the fifty-three weeks ended
October 3, 1993 and fifty-two weeks ended September 27, 1992 and September 29,
1991, incorporated by reference herein, have been incorporated by reference
herein in reliance upon the report of KPMG Peat Marwick, independent certified
public accountants, incorporated by reference herein and upon the authority of
said firm as experts in accounting and auditing.
The consolidated financial statements of Family Restaurants, Inc.
(formerly The Restaurant Enterprises Group, Inc.) incorporated by reference
from Foodmaker's Current Report on Form 8-K/A dated January 27, 1994 have
been audited by Deloitte & Touche, independent auditors, as stated in their
report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
53
FM 1993A CORP.
INDEX TO FINANCIAL STATEMENTS
Financial Statements Page
----
Independent Auditors' Report F-2
Balance Sheet - December 31, 1993 F-3
Notes to Balance Sheet F-4
F-1
INDEPENDENT AUDITORS' REPORT
The Board of Directors
FM 1993A Corp.:
We have audited the accompanying balance sheet of FM 1993A Corp. as of
December 31, 1993. This balance sheet is the responsibility of the Company's
management. Our responsibility is to express an opinion on this balance sheet
based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the balance sheet is free of material misstatement. An
audit of a balance sheet includes examining, on a test basis, evidence
supporting the amounts and disclosures in that balance sheet. An audit of a
balance sheet also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
balance sheet presentation. We believe that our audit of the balance sheet
provides a reasonable basis for our opinion.
In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of FM 1993A Corp. at December 31, 1993
in conformity with generally accepted accounting principles.
KPMG PEAT MARWICK
San Diego, California
April 29, 1994
F-2
FM 1993A CORP.
BALANCE SHEET
December 31, 1993
ASSETS
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . $100
----
$100
====
STOCKHOLDER'S EQUITY
Common Stock, no par value, 1,000 shares
authorized, 100 shares issued and outstanding . . . . . $100
----
$100
====
See accompanying notes to this statement.
F-3
FM 1993A CORP.
NOTES TO BALANCE SHEET
December 31, 1993
1. Organization
FM 1993A Corp. (the "Company") was incorporated in the State of Delaware
on December 22, 1993 for the purpose of: (i) issuing and selling debt
obligations ("Notes"), as principal and as agent for CRC-I Limited Partnership
("CRC-I") and CRC-II Limited Partnership ("CRC-II), Massachusetts limited
partnerships, and (ii) acquiring, owning and holding obligations of CRC-I and
CRC-II (collectively, the "CRC Notes") as well as accounts, investments and
other property to be pledged as collateral for the Notes. The Company may not
engage in any other activities other than those required to accomplish the
foregoing.
CRC-I and CRC-II (collectively, "CRC") are special purpose limited
partnerships organized to (i) acquire, own, hold and sell or transfer estates
for years in various existing and to-be-constructed Foodmaker, Inc. restaurant
properties, (ii) sell mortgage notes to the Company accompanied by a pledge of
the foregoing estates for years, and (iii) lease the restaurant properties to
Foodmaker. CRC-I and CRC-II may not engage in any other activities other than
those required to accomplish the foregoing.
2. Subsequent Event
On January 5, 1994, in a private placement transaction, the Company issued
and sold $70 million aggregate principal amount of Notes for $68.9 million,
which proceeds were used to purchase CRC Notes with an aggregate principal
amount of $70 million. The Notes are due November 1, 2003, payable interest
only at the rate of 9.75% per annum semi-annually on July 1 and January 1 each
year, with a mandatory prepayment of 50% of the original principal on the first
business day of January 2002. The CRC Notes' payment and interest terms are
equivalent to and structured to coincide with the Notes such that funds will be
available to make payments on the Notes. In addition, the CRC Notes require
semi-annual sinking fund payments to a trustee of $747 thousand, which will be
utilized to partially fund the 50% prepayment in January 2002. The Notes are
secured by, among other things, the CRC Notes, the CRC leases to Foodmaker,
first priority liens on the underlying properties and any sinking fund or other
amounts held in trust.
F-4
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 30. Other Expenses of Issuance and Distribution.
SEC Registration Fee $ 24,138
Legal Fees and Expenses *
Accountants' Fees and Expenses *
Blue Sky Fees and Expenses *
Transfer Agent's Fees *
Miscellaneous *
----------
Total Expenses $
==========
- --------------------
* Estimated
Item 31. Sales to Special Parties.
Not Applicable
Item 32. Recent Sales of Unregistered Securities.
On January 5, 1994, in a private placement transaction, FM 1993A Corp.
(the "Issuer") issued and sold $70,000,000 aggregate principal amount of 9.75%
Senior Secured Notes due November 1, 2003 (the "Old Notes"). Jeffries &
Company, Inc. was the placement agent in the above-mentioned transaction. The
Old Notes were sold to a limited number of institutional investors meeting the
criteria for qualified Institutional Investors (as defined in Rule 144A under
the Securities Act) or Accredited Investors (as defined in Rule 501(A) under
the Securities Act).
The aggregate offering and sale price for the Old Notes was $68,908,000.
The underwriting commission was $______________.
Exemption from registration was claimed under Section 4(2) of the
Securities Act based on the manner of offering and the limited number and
nature of the purchase.
One hundred percent of the Issuer's common stock was issued in a private
placement under Section 4(2) of the Securities Act to Robert H. Key, an
individual, in December, 1993.
Item 33. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law makes provision for
the indemnification of officers and directors in terms sufficiently broad to
indemnify officers and directors of the Company under certain circumstances
from liabilities (including reimbursement for expenses incurred) arising under
the Securities Act of 1933. The Certificate of Incorporation and Bylaws of
Issuer and Foodmaker provide for indemnification of officers and directors
against costs and expenses incurred in connection with any action or suit to
which such person is a party to the full extent permitted by the Delaware
General Corporation Law.
Item 34. Treatment of Proceeds From Stock Being Registered.
Not Applicable.
II-1
Item 35. Exhibits.
Number Description
3.1 Certificate of Incorporation of FM 1993A Corp.
3.2 Bylaws of FM 1993A Corp.
4.1 Indenture Agreement dated as of December 15, 1993, by and
between the FM 1993A Corp. and State Street Bank and Trust
Company **
4.1.1 Amendment dated _________, 1994 to Indenture Agreement*
4.1.2 Form of Series B 9.75% Senior Secured Notes*
4.2 Limited Partnership Guaranties dated as of December 15, 1993
5 Opinion of Gibson, Dunn & Crutcher*
10.1 Master Leases (incorporated by reference from Foodmaker's
Quarterly Report on Form 10-Q for the quarter ended
January 23, 1994)
10.2 Agreement Regarding Corporate Governance
23.1 Consent of Gibson, Dunn & Crutcher (included in Exhibit 5)*
23.2 Consent of KPMG Peat Marwick
23.3 Consent of KPMG Peat Marwick
23.4 Consent of Deloitte & Touche
24 Powers of Attorney (contained on pages II-3 - II-7 of this
Registration Statement)
25 Statement of Eligibility of Trustee*
99 Form of Letter of Transmittal
- -------------------
* To be filed by amendment.
** Schedules (or similar attachments) to this exhibit do not contain
information which is material to an investment decision and not
otherwise disclosed in the Registration Statement or the exhibits
thereto. A copy of any omitted schedule will be furnished to the
Commission upon request.
Item 36. Undertakings.
The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrants' annual reports pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-2
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrants pursuant to the foregoing provisions, or otherwise, the registrants
have been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrants of expenses incurred or
paid by a director, officer or controlling person of the registrants in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the offering of the
securities being registered, the registrants will, unless in the opinion of
their counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
them is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), Foodmaker, Inc. certifies that it has reasonable
grounds to believe that it meets all of the requirements for filing a Form S-3
and has duly caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of San Diego, State of
California, on the 3rd day of May, 1994.
FOODMAKER, INC.
By: /S/Charles W. Duddles
-----------------------------------
Charles W. Duddles,
Executive Vice President, Chief
Administrative Officer and
Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Charles W. Duddles and William E. Rulon,
Esq., and each of them, his true and lawful attorneys-in-fact and agents, each
with full power of substitution and resubstitutions, for his and in his name,
place and stead, in any and all capacities, to sign any or all amendments to
this registration statement, before and after the effective date thereof, and
to file the same with all exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto each of
said attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about
the premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that either of said attorneys-in-
fact and agents, or his substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement has been signed below by the following persons in the capacities and
on the dates indicated:
Signature Title Date
--------- ----- ----
/S/Jack W. Goodall Chairman of the Board, May 3, 1994
- ----------------------- Chief Executive Officer
Jack W. Goodall and President (Principal
Executive Officer)
/S/Charles W. Duddles Executive Vice President, May 3, 1994
---------------------- Chief Administrative
Charles W. Duddles Officer, Chief Financial
Officer and Director
(Principal Financial
Officer)
/S/Robert L. Suttie Vice President, Controller May 3, 1994
---------------------- and Chief Accounting
Robert L. Suttie Officer (Principal
Accounting Officer)
II-4
Signature Title Date
--------- ----- ----
/S/Robert J. Nugent Executive Vice President, May 3, 1994
- ----------------------- President of Jack In The
Robert J. Nugent Box Division and Director
- ----------------------- Director
Leonard I. Green
- ----------------------- Director
Edward Gibbons
/S/L. Robert Payne
- ----------------------- Director May 3, 1994
L. Robert Payne
- ----------------------- Director
Christopher V. Walker
/S/Paul T. Carter
- ----------------------- Director May 3, 1994
Paul T. Carter
/S/Michael E. Alpert
- ----------------------- Director May 3, 1994
Michael E. Alpert
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), FM 1993A Corp. certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing a Form S-11 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Diego, State of
California, on the 3rd day of May, 1994.
FM 1993A CORP.
By: /S/Charles W. Duddles
-----------------------------------
Charles W. Duddles,
President, Treasurer and Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Charles W. Duddles and Charles F.
MacGill, and each of them, his true and lawful attorneys-in-fact and agents,
each with full power of substitution and resubstitutions, for his and in his
name, place and stead, in any and all capacities, to sign any or all amendments
to this registration statement, before and after the effective date thereof,
and to file the same with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto each of said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that either of said
attorneys-in-fact and agents, or his substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement has been signed below by the following persons in the capacities and
on the dates indicated:
Signature Title Date
--------- ----- ----
/S/Charles W. Duddles Director, President, May 3, 1994
- ------------------------ Treasurer and Secretary
Charles W. Duddles (Principal Financial and
Accounting Officer)
/S/Charles F. MacGill
- ------------------------ Director May 3, 1994
Charles F. MacGill
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended
(the "Securiteis Act"), CRC-I Limited Partnership certifies that it has
reasonable grounds to believe that it meets all of the requirements for filing
a Form S-11 and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of San Diego,
State of California, on the 3rd day of May, 1994.
CRC-I LIMITED PARTNERSHIP
By: CRC-I Corp., General Partner
By: /S/Charles W. Duddles
------------------------------
Charles W. Duddles,
President, Treasurer and Clerk
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Charles W. Duddles and Charles F.
MacGill, and each of them, his true and lawful attorneys-in-fact and agents,
each with full power of substitution and resubstitutions, for his and in his
name, place and stead, in any and all capacities, to sign any or all amendments
to this registration statement, before and after the effective date thereof,
and to file the same with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto each of said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that either of said
attorneys-in-fact and agents, or his substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement has been signed below by the following persons in the capacities and
on the dates indicated:
Signature Title Date
--------- ----- ----
/S/Charles W. Duddles
- ------------------------ Director of CRC-I Corp. May 3, 1994
Charles W. Duddles
/S/Charles F. MacGill
- ------------------------ Director of CRC-I Corp. May 3, 1994
Charles F. MacGill
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), CRC-II Limited Partnership certifies that it has
reasonable grounds to believe that it meets all of the requirements for filing
a Form S-11 and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of San Diego,
State of California, on the 3rd day of May, 1994.
CRC-II LIMITED PARTNERSHIP
By: CRC-II Corp., General Partner
By: /S/Charles W. Duddles
------------------------------
Charles W. Duddles,
President, Treasurer and Clerk
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Charles W. Duddles and Charles F.
MacGill, and each of them, his true and lawful attorneys-in-fact and agents,
each with full power of substitution and resubstitutions, for his and in his
name, place and stead, in any and all capacities, to sign any or all amendments
to this registration statement, before and after the effective date thereof,
and to file the same with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto each of said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that either of said
attorneys-in-fact and agents, or his substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement has been signed below by the following persons in the capacities and
on the dates indicated:
Signature Title Date
--------- ----- ----
/S/Charles W. Duddles Director of CRC-II Corp. May 3, 1994
- ------------------------
Charles W. Duddles
/S/Charles F. MacGill
- ------------------------ Director of CRC-II Corp. May 3, 1994
Charles F. MacGill
II-8