UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
December 19, 2000
CARROLS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 16-0958146 0-25629
(State or other jurisdiction (IRS employer identification no.) (Commission
of incorporation or organization) File Number)
968 James Street
Syracuse, New York 13203
(Address of principal executive office, including ZIP Code)
(315) 424-0513
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
CARROLS CORPORATION
Form 8-K/A
Item 1 - 6 . --Not Applicable
Item 7(b) -- Pro Forma Financial Information
This amendment provides the pro forma consolidated financial information of
Carrols Corporation (the "Company") pursuant to Article 11 of Regulation S-X as
of and for the nine months ended September 30, 2000 and the year ended December
31, 1999, which was not included in the Form 8-K filed by the Company on January
3, 2001, since the information required was not determinable at such time.
CARROLS CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
The following unaudited pro forma consolidated balance sheet as of September 30,
2000 and the unaudited pro forma consolidated statements of operations for the
nine months ended September 30, 2000 and the year ended December 31, 1999 have
been prepared to give effect to (i) the acquisition by the Company of all of the
outstanding shares, employee stock options and the assumption of outstanding
debt of Taco Cabana, Inc. ("Taco Cabana") on December 19, 2000 (the
"Acquisition") for $9.04 per share, for an aggregate purchase price of
approximately $154.7 million (including approximately $42.7 million of Taco
Cabana debt paid at closing) and, (ii) the incurrence, by the Company, of debt
under its senior credit facility for the purpose of completing the Acquisition.
The unaudited pro forma consolidated balance sheet gives effect to the
transactions described above as if they were consummated on September 30, 2000.
The unaudited pro forma consolidated statements of operations give effect to all
of the transactions described above as if they had occurred on January 1, 1999.
The unaudited pro forma consolidated financial data has been derived by the
Company by the application of pro forma adjustments to the unaudited
consolidated financial statements of the Company as of and for the nine months
ended September 30, 2000 and to the audited consolidated financial statements of
the Company for the year ended December 31, 1999 and to the audited financial
statements of Taco Cabana for the year ended December 31, 1999 and unaudited
financial statements of Taco Cabana as of and for the nine months ended
September 30, 2000. Taco Cabana's historical financial statements have been
reclassified to conform to the Company's historical classifications.
The unaudited pro forma financial data has been derived under the assumption
that the Acquisition has been accounted for using the purchase method of
accounting, under which tangible and identifiable intangible assets acquired
and liabilities assumed are recorded at their respective fair values.
Allocations of the purchase price in the Acquisition have been determined based
on estimates of fair value, which included independent appraisals for certain
fee owned real property.
The unaudited pro forma consolidated financial data does not purport to be
indicative of the financial position or results of operations which would have
been attained had the Acquisition been consummated on the dates indicated or
which may be attained in the future. The pro forma adjustments, as described in
the notes to the unaudited pro forma consolidated balance sheet and the notes to
the unaudited pro forma consolidated statements of operations, are based on
available information and upon certain assumptions which management believes to
be reasonable. These pro forma statements should be read in conjunction with the
historical financial statements and accompanying notes of the Company and Taco
Cabana. The audited consolidated financial statements for the Company are
contained in the Company's Annual Report on Form 10-K for the year ended
December 31, 1999 and are incorporated herein by reference. The unaudited
consolidated financial statements for the Company are contained in the Company's
quarterly report on Form 10-Q as of and for the nine months ended September 30,
2000 and are incorporated herein by reference. The audited consolidated
financial statements for Taco Cabana for the year ended December 31, 1999 and
the unaudited consolidated financial statements of Taco Cabana as of and for the
nine months ended September 30, 2000 are contained as exhibits in the Carrols
Corporation Form 8K dated December 19, 2000 and are incorparated herein by
reference.
CARROLS CORPORATION AND SUBSIDIARIES
PROFORMA CONSOLIDATED BALANCE SHEET
September 30, 2000
(Unaudited)
(1)
Carrols Taco Cabana Pro Froma Pro Forma
Historical Historical Adjustments Combined
----------- ----------- ----------- ----------
ASSETS:
Current assets:
Cash and cash equivalents $ 1,495,000 $ 287,000 $ $ 1,782,000
Trade and other receivables 698,000 817,000 1,515,000
Inventories 4,991,000 1,044,000 6,035,000
Prepaid rent 2,070,000 683,000 2,753,000
Prepaid expenses and other current assets 1,814,000 2,675,000 (181,000)(2) 4,308,000
Refundable income taxes 562,000 599,000 1,161,000
Deferred income taxes 5,266,000 135,000 5,401,000
------------- ------------- ------------ -------------
Total current assets 16,896,000 6,240,000 (181,000) 22,955,000
Property and equipment, net 133,178,000 93,479,000 2,889,000 (2) 229,546,000
Franchise rights, net 100,118,000 - 100,118,000
Intangible assets, net 65,998,000 9,699,000 55,027,000 (5) 130,724,000
Other assets 9,610,000 474,000 10,084,000
Deferred income taxes - 7,549,000 4,026,000 (2) 11,575,000
------------- ------------- ------------ -------------
$325,800,000 $117,441,000 $61,761,000 $505,002,000
============= ============= ============ =============
LIABILITIES AND STOCKHOLDER'S (DEFICIT) EQUITY:
Current liabilities:
Accounts payable $ 10,099,000 $ 2,868,000 $ $ 12,967,000
Accrued interest 5,669,000 257,000 5,926,000
Accrued payroll, related taxes and benefits 7,979,000 3,355,000 11,334,000
Other liabilities 8,047,000 3,711,000 11,758,000
Current portion of long-term debt 4,750,000 5,813,000 (5,813,000)(3) 4,750,000
Current portion of capital lease obligations 249,000 258,000 507,000
------------- ------------- ------------ -------------
Total current liabilities 36,793,000 16,262,000 (5,813,000) 47,242,000
Long-term debt, net of current portion 234,653,000 35,856,000 (35,856,000)(3) 389,321,000
154,668,000 (4)
Capital lease obligations, net of current portion 1,270,000 1,706,000 2,976,000
Deferred income - sale/leaseback of real estate 4,243,000 - 4,243,000
Accrued postretirement benefits 2,069,000 - 2,069,000
Deferred income taxes 2,997,000 - 2,997,000
Other liabilities 24,824,000 6,086,000 6,293,000 (2) 37,203,000
------------- ------------- ------------ -------------
Total liabilities 306,849,000 59,910,000 119,292,000 486,051,000
------------ ------------- ------------ -------------
Stockholder's equity:
Common stock 10 135,000 (135,000) 10
Additional paid-in capital 24,484,990 85,052,000 (85,052,000) 24,484,990
Accumulated deficit (5,534,000) (12,678,000) 12,678,000 (5,534,000)
Treasury stock (14,978,000) 14,978,000 -
------------- ------------- ------------ -------------
Total stockholder's equity 18,951,000 57,531,000 (57,531,000)(3) 18,951,000
------------- ------------- ------------ -------------
$325,800,000 $117,441,000 $61,761,000 $505,002,000
============= ============= ============ =============
(1) Includes certain reclassifications made to conform to Carrols historical
presentation.
(2) Represents adjustments to the basis of assets and liabilities acquired from
Taco Cabana to reflect estimated fair values as of the date of acquisition,
including the related tax effect.
(3) Adjustments to eliminate Taco Cabana's debt and stockholders' equity as of
September 30, 2000.
(4) Adjustment to reflect the financing of the Taco Cabana acquisition on
December 19, 2000. The Company, subsequently sold 25 fee owned properties in
a sale/leaseback transaction, the proceeds from which were $29.4 million.
The proceeds, which were received in December 2000, were used to reduce the
debt incurred for the acquisition. The proforma effects of that transaction
have not been included in these proforma statements.
(5) To reflect the excess cost over fair value of net assets acquired in the
Taco Cabana acquisition.
CARROLS CORPORATION AND SUBSIDIARIES
PROFORMA CONSOLIDATED STATEMENT OF OPERATIONS
Nine months ended September 30, 2000
(Unaudited)
(1)
Carrols Taco Cabana Pro Forma Pro Forma
Historical Historical Adjustments Total
---------- ---------- ----------- -----
Revenues:
Restaurant sales $345,293,000 $127,908,000 $473,201,000
Franchise fees and royalty revenues 711,000 283,000 - 994,000
------------- ------------- ------------ ---------------
Total revenues 346,004,000 128,191,000 - 474,195,000
Costs and Expenses:
Cost of sales 98,719,000 38,461,000 137,180,000
Restaurant wages and related expenses 100,368,000 35,749,000 136,117,000
Other restaurant operating expenses 68,030,000 21,512,000 (369,000)(7) 89,173,000
Advertising expense 15,928,000 4,769,000 (501,000)(5) 20,697,000
General and administrative 18,849,000 8,180,000 26,528,000
Depreciation and amortization 20,356,000 6,773,000 2,064,000 (4) 29,345,000
152,000 (3)
Other income (1,365,000) - - (1,365,000)
------------- ------------- ------------ ---------------
Total operating expenses 320,885,000 115,444,000 1,346,000 437,675,000
------------- ------------- ------------ ---------------
Income (loss) from operations 25,119,000 12,747,000 (1,346,000) 36,520,000
Interest expense 17,395,000 2,288,000 8,426,000 (2) 28,109,000
------------- ------------- ------------ ---------------
Income (loss) before income taxes 7,724,000 10,459,000 (9,772,000) 8,411,000
Provision (benefit) for income taxes 3,824,000 (7,290,000) (2,698,000)(6) (6,164,000)
------------- ------------- ------------ ---------------
Net income (loss) $ 3,900,000 $ 17,749,000 $(7,074,000) $ 14,575,000
============= ============= ============ ===============
(1) Certain reclassifications have been made to conform to Carrols
presentation.
(2) To remove Taco Cabana's historical interest expense (excluding capital
lease interest) and reflect Carrols' interest expense on incremental
borrowings for the acquisition:
Taco Cabana historical interest expense $ (2,130,000)
Carrols interest expense at 10.3% 10,556,000
--------------
Net adjustment $ 8,426,000
==============
(3) Reflects additional depreciation related to the following:
Reclassification of assets $ 195,000
Fair value adjustments (43,000)
--------------
Net adjustment $ 152,000
==============
(4) Reflects amortization of excess cost over fair value resulting from the
Taco Cabana acquisition over a period of 20 years.
(5) To eliminate non-continuing expenses of Taco Cabana subsequent to its
acquisition, principally expenses of a public company and directors fees.
(6) To reflect the tax effect on adjustments at a rate of 35%, except for the
non-deductible amortization of excess cost over fair value which has no
tax benefit associated with it.
(7) To adjust rent expense for leases in excess of fair market value
CARROLS CORPORATION AND SUBSIDIARIES
PROFORMA CONSOLIDATED STATEMENT OF OPERATIONS
Year ended December 31, 1999
(Unaudited)
(1)
Carrols Taco Cabana Pro Forma Pro Forma
Historical Historical Adjustments Total
---------- ---------- ----------- -----
Revenues:
Restaurant sales $ 455,440,000 $ 157,530,000 $612,970,000
Franchise fees and royalty revenues 1,039,000 359,000 1,398,000
----------- ------------ ------------ -----------
Total revenues 456,479,000 157,889,000 - 614,368,000
Costs and Expenses:
Cost of sales 137,279,000 47,539,000 184,818,000
Restaurant wages and related expenses 134,125,000 43,715,000 177,840,000
Other restaurant operating expenses 89,093,000 26,285,000 (492,000) (7) 114,886,000
Advertising expense 20,618,000 6,045,000 26,663,000
General and administrative 23,102,000 10,003,000 (650,000) (5) 32,455,000
Depreciation and amortization 23,898,000 8,761,000 202,000 (3) 35,612,000
2,751,000 (4)
----------- ------------ ------------ -----------
Total operating expenses 428,115,000 142,348,000 1,811,000 572,274,000
----------- ------------ ------------ -----------
Income (loss) from operations 28,364,000 15,541,000 (1,811,000) 42,094,000
Interest expense 22,386,000 2,424,000 11,881,000 (2) 36,691,000
----------- ------------ ------------ -----------
Income (loss) before income taxes and extraordinary loss 5,978,000 13,117,000 (13,692,000) 5,403,000
Provision (benefit) for income taxes 3,826,000 - <3,829,000> (6) 3,000
----------- ------------ ------------ -----------
Income (loss) before extraordinary loss 2,152,000 13,117,000 (9,863,000) 5,406,000
Extraordinary loss on extinguishment of debt, net of tax benefit 1,099,000 - - 1,099,000
----------- ------------ ------------ -----------
Net income (loss) $ 1,053,000 $13,117,000 $(9,863,000) $ 4,307,000
=========== ============ ============ ============
(1) Certain reclassifications have been made to conform to Carrols
presentation.
(2) To remove Taco Cabana's historical interest expense (excluding capital
lease interest) and reflect Carrols' interest expense on incremental
borrowings for the acquisition:
Taco Cabana historical interest expense $ (2,193,000)
Carrols interest expense at 10.3% 14,074,000
-----------
Net adjustment $ 11,881,000
===========
(3) Reflects additional depreciation related to the following:
Reclassification of assets $ 260,000
Fair value adjustments (58,000)
-----------
Net adjustment $ 202,000
===========
(4) Reflects amortization of excess cost over fair value resulting from the
Taco Cabana acquisition over a period of 20 years.
(5) To eliminate non-continuing expenses of Taco Cabana subsequent to its
acquisition, principally expenses of a public company and directors fees.
(6) To reflect the tax effect on adjustments at a rate of 35%, except for the
non-deductible amortization of excess cost over fair value which has no
tax benefit associated with it.
(7) To adjust rent expense for leases in excess of fair market value.
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.
CARROLS CORPORATION
(Registrant)
Date: March 2, 2001 By: /s/ Paul R. Flanders
--------------------
Paul R. Flanders, Vice President - Finance
and Treasurer