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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 30, 1995
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CKE RESTAURANTS, INC.
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(Exact name of registrant as specified in charter)
Delaware 1-13192 33-0602639
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(State of other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1200 North Harbor Boulevard, Anaheim, California 92801
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (717) 774-5796
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets.
In January 1994, CKE Restaurants, Inc. (the "Company") acquired the
rights to develop, own and operate up to 300 Boston Chicken stores throughout
designated markets in California from Boston Chicken, Inc. ("BCI"). In
consideration for these rights, the Company paid a total of $2,000,000, which
consisted of a $1,000,000 initial development fee and a $1,000,000 deposit
towards the future franchise fees due BCI ($35,000 per store payable upon the
opening of each new Boston Chicken store) over the five-year term of this
agreement. The unamortized balances of both of these amounts were included in
other assets in the Company's consolidated balance sheets for the Company's
fiscal year ending January 30, 1995.
The Company's obligation under the terms of this agreement included
opening 20 Boston Chicken stores during fiscal 1995, followed by an additional
40 to 50 stores per year during the next four years, for an aggregate of 200
stores by January 15, 1999. This agreement also contained an option to develop
an additional 100 stores under certain conditions. Boston Pacific, Inc.
("Boston Pacific") was formed during fiscal 1995, as a wholly-owned subsidiary
of the Company, to conduct the Company's Boston Chicken franchise operations
and the results of these operations were included in the accompanying
consolidated financial statements. A total of 22 stores were opened by Boston
Pacific during fiscal 1995, seven of which were converted Carl's Jr.
restaurants. In addition, another five stores were under construction as of
the end of fiscal 1995.
In April 1995, the Company completed a transaction that resulted in the
formation of a new wholly-owned company, Boston West, L.L.C. ("Boston West"),
that assumed the operations of Boston Pacific and agreed to fulfill the
Company's obligations under its agreement with BCI. Boston Pacific contributed
a majority of its existing Boston Chicken restaurant assets valued at
approximately $22 million to this new entity and BCI agreed to lend Boston
West, over time, up to $63.8 million, subject to certain conditions. This loan
is convertible to equity in Boston West, at BCI's option, at 115% of the
original equity price. In addition, approximately $12 million of equipment and
real property retained by Boston Pacific was leased to Boston West at current
market rates. An affiliate of BCI has an option to purchase all the equipment
and real property leased to Boston West by Boston Pacific.
In exchange for its assets, Boston Pacific received 62,000 Class A
Membership Units (valued at $10.00 per Unit) and 22,951 Class B Membership
Units (valued at $1,000.00 per Unit) in Boston West. It was contemplated that,
during the first half of fiscal
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1996, additional equity units in Boston West would be sold such that the
Company would own less than 20% of the common equity units of Boston West. For
the period prior to the sale of these interests, the Company is required to
continue to include the results of Boston West's operations in the Company's
consolidated financial statements.
On May 30, 1995, Boston West consummated the sale of 250,000 of its
Class A Membership Units (valued at $10.00 per Unit) to third party investors
unaffiliated with the Company. As a result of such sale, the Company owns less
than 20% of the common equity units of Boston West.
The Company's ownership in Boston West may be increased to up to
approximately 35% by an option to co-fund the capital requirements of Boston
West up to a maximum of $15 million. This $15 million may be funded, in part,
by proceeds of the purchase option in the equipment and real property leases
when and if they are exercised.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro forma financial information.
[At the time of filing this Report, it is impracticable to provide
the required pro forma financial statements. The required pro forma financial
statements will be filed by the Registrant, under cover of Form 8-K/A, as soon
as practicable, but not later than July 28, 1995.]
(c) Exhibits.
Exhibit No. Description of Document
(2)(a) Agreement to Contribute Assets dated April 6, 1995
between Boston Pacific, Inc. and Boston West,
L.L.C. (together with a list briefly identifying
the omitted exhibits, schedules and appendices
thereto). The Registrant agrees to provide copies
of such exhibits, schedules and appendices to the
Commission upon request.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
CKE RESTAURANTS, INC.
Date: June 12, 1995 By:______________________________
Joseph N. Stein
Chief Financial Officer
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INDEX TO EXHIBITS
(2) Plan of acquisition, reorganization, arrangement, liquidation or
succession
(a) Agreement to Contribute Assets dated April 6, 1995 between Boston
Pacific, Inc. and Boston West, L.L.C. (together with a list briefly
identifying the omitted exhibits, schedules and appendices
thereto). The Registrant agrees to provide copies of such
exhibits, schedules and appendices to the Commission upon request.
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