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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT

(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 2, 2002
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission File No. 0-14311

FAMILY STEAK HOUSES OF FLORIDA, INC.
(exact name of registrant as specified in its charter)

Florida No. 59-2597349
(State of Incorporation) (I.R.S. Employer Identification)

2113 Florida Boulevard
Neptune Beach, Florida 32266
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (904) 249-4197
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 Par Value
(Title of Class)
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES [ X ] NO [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.
[ ]

As of February 15, 2002, 3,251,016 shares of Common Stock of the registrant
were outstanding. The aggregate market value of such voting Common Stock (based
upon the closing sale price of the registrant's Common Stock on the NASDAQ
SmallCap Market System on February 15, 2002, as reported in The Wall Street
Journal) held by non-affiliates of the registrant was approximately $1,540,000.

Documents Incorporated by Reference Portions of the registrant's 2001
Annual Report to Shareholders are incorporated by reference into Part II.
Portions of the Proxy Statement for the registrant's 2002 Annual Meeting of
Shareholders are incorporated by reference into Part III.

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PART I
ITEM 1. BUSINESS
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General

Family Steak Houses of Florida, Inc. ("Family" or the "Company"), is the
sole franchisee of Ryan's Family Steak House restaurants ("Ryan's restaurants")
in the State of Florida.

The Company's first Ryan's restaurant was opened in Jacksonville, Florida,
in May 1982. The Company presently operates 23 Ryan's restaurants in Florida.

A Ryan's restaurant is a family-oriented restaurant serving high-quality,
reasonably priced food in a casual atmosphere with server-assisted service. The
restaurants feature self-service scatter bars with a variety of over 100 fruit,
vegetable and meat entree items, bakery and dessert bar, and table service and
drink refills. Several restaurants feature a display cooking area, where guests
can have grilled-to-order steaks, chicken, pork chops and other items cooked to
order for them, all of which is included in the price of the buffet. The Company
believes that its operating strategy of selling top-quality meals at reasonable
prices creates a perception of value to its customers.

The Company operates its Ryan's restaurants under a Franchise Agreement
with Ryan's Properties, Inc., ("Ryan's", or the "Franchisor") which grants the
Company the right to operate Ryan's Family Steak House restaurants throughout
North and Central Florida.

Company History

The Company was formed by the combination, effective September 1985, of six
limited partnerships, each of which owned and operated a Ryan's restaurant
franchise. In April 1986, the Company issued 853,200 shares of its common stock
in exchange for the assets and liabilities of the predecessor partnerships and
1,134,000 shares of its common stock to Eddie L. Ervin, Jr., in consideration
for Mr. Ervin assigning to the Company all of his rights under the Franchise
Agreement, as defined below. The Company completed its initial public offering
of 900,000 shares of its common stock in 1986 resulting in net proceeds to the
Company of approximately $4,145,000.


2


Franchise Agreement

The Company operates its Ryan's restaurants under a Franchise Agreement
between the Company and Ryan's dated as of September 16, 1987, which Franchise
Agreement amended and consolidated all previous franchise agreements (as
amended, the "Franchise Agreement"). The Franchise Agreement extends through
December 31, 2010 and provides for two additional ten-year renewal options. The
renewal options are subject to certain conditions, including the condition that
the Company has performed its obligations under the Franchise Agreement during
its original term.

In October 1996, the Company amended its Franchise Agreement with Ryan's.
The amended agreement required the Company to pay a monthly royalty fee of 3.0%
through December 2001, and 4.0% thereafter of the gross receipts of each Ryan's
Family Steak House restaurant. Total franchise fee expenses were $1,260,300,
$1,197,600 and $1,165,300 for fiscal years 2001, 2000, and 1999, respectively.

The Company's franchise agreement with Ryan's granted the Company the
exclusive right to open Ryan's restaurants in North and Central Florida. In
order to maintain this exclusivity, the Company was required to have a total of
25 Ryan's restaurants operating on December 31, 2001. At December 31, 2001, the
Company was only operating 23 restaurants. On January 4, 2002, the Company was
notified by Ryan's that it had exercised its option to terminate the exclusive
nature of the Company's franchise rights within North and Central Florida.

The Company is in the process of evaluating its options with respect to the
exclusivity and other Franchise Agreement issues, including possible legal
action through binding arbitration proceedings seeking, among other things, the
recision of Ryan's exercise of its option to terminate the Company's
exclusivity. It is the Company's intention to pursue a legal remedy if it is
deemed to be in its shareholders' best interest to do so.


Subsequent to January 4, 2002, the Company was advised by Ryan's Chief
Executive Officer that Ryan's current plans did not include building any
restaurants in the Company's territories in 2002, and that it will probably
build a few restaurants in North Florida in 2003. However, there are no
assurances that Ryan's will not decide to adopt a more aggressive building

3


program in the Company's territories. Management believes that if Ryan's builds
restaurants in the Company's territories it could limit the Company's potential
to locate and develop suitable restaurant sites in the future.

The following schedule outlines the number of Ryan's restaurants required
to be operated by the Company as of December 31 each year under the amended
Franchise Agreement. Failure to maintain the required number of restaurants is a
default under the agreement, and could result in the Company losing the right to
operate under the Ryan's name.

Number of
Restaurants Required to
End of Fiscal Year be in Operation
- ------------------ -----------------------

2001 20
2002 22
2003 24
2004 25
2005 27

Through the opening of new restaurants and the closing of under-performing
restaurants, the Company has operated between 23 and 24 restaurants since
January 1999.

The Franchise Agreement as amended also clarifies that the Franchisor's
consent is needed for certain kinds of transactions. The transactions include
(1) a person's (or group's) acquisition of 25% of the Company's common stock
(other than a person who owned 15% of the Company's common stock as of December
15, 1998), (2) turnover during any consecutive 12 month period of more than a
majority of the Company's board of directors unless the new directors are
approved by a two-thirds vote of the directors then still in office who either
were directors at the beginning of the 12 month period or whose election or
nomination for election was previously so approved; and (3) the Company's or any
affiliates' ownership, engagement in or interest in the operation of any other
family-oriented steak house restaurant.

The Franchise Agreement contains provisions relating to the operation of
the Company's Ryan's restaurants. Upon the Company's failure to comply with such
provisions, the Franchisor may terminate the Franchise Agreement if such default
is not cured within 30 days of notice from the Franchisor. Termination of the
Franchise Agreement would result in the loss of the Company's right to use the



4


"Ryan's Family Steak House" name and concept and could result in the sale of the
physical assets of the Company to the Franchisor pursuant to a right of first
refusal. Termination of the Company's rights under the Franchise Agreement could
result in the disruption of the Company's operations. The Company believes that
it has operated and maintained each of its Ryan's Family Steak House restaurants
in accordance with the operational procedures and standards set forth in the
Franchise Agreement.

Operations of Ryan's Restaurants

Format. As of February 15, 2002, 21 of the Company's Ryan's restaurants are
located in free-standing buildings which vary in size from 7,500 to 12,000
square feet. Two of the Company's Ryan's restaurants are located in shopping
malls. Each restaurant is constructed of brick or stucco walls, interior and
exterior, with exposed woodwork. The interior of each Ryan's restaurant contains
a dining room, a customer ordering area, and a kitchen. The dining rooms seat
between 270 and 500 persons and highlight centrally located, illuminated scatter
bars and a fresh bakery and dessert bar. Six restaurants include a display
cooking area with a charcoal grill and a flat grill for grilled-to-order steaks,
pork chops and chicken items, a rotisserie chicken broiler, a pizza oven and a
wok for preparation of Chinese food items. Each Ryan's restaurant has parking
for approximately 100 to 175 cars on lots of overall size of approximately
50,000 to 70,000 square feet.

The Ryan's restaurants operate seven days a week. Typical hours of
operation are from 11:00 a.m. to 9:00 p.m., Sunday through Thursday, and from
11:00 a.m. to 10:00 p.m., Friday and Saturday. Restaurants that serve breakfast
open at 8:00 a.m. Saturday and Sunday. In a Ryan's restaurant, the customer
enters the restaurant, orders from the menu, and then enters the dining room.
Beverages are brought to the table by servers. Entrees are cooked to order at
most locations. The customer ordering the buffet is given unlimited access to
the scatter bars and the bakery and dessert bar. Customers receive table service
of the entree and beverage refills, except at stores with display cooking, which
offer buffet only. For the fiscal year ended January 2, 2002, the average weekly
customer count per restaurant was approximately 5,150 and the average meal price
(including beverage) was approximately $6.85.


5


Restaurant Management and Supervision. The Company manages the Ryan's
restaurants pursuant to a standardized operating and control system together
with comprehensive recruiting and training of personnel to maintain food and
service quality. In each Ryan's restaurant, the management group consists of a
general manager, a manager and one to three assistant managers, depending on
sales volume. The Company requires at least two members of the management group
on duty during all peak serving periods. Management-level personnel usually
begin employment at the manager trainee or assistant manager level, depending on
prior restaurant management experience. All new management-level personnel must
complete the Company's five-week training program prior to being placed in a
management position.

Each restaurant management group reports to a supervisor. Presently, the
supervisors each oversee the operations of five to seven restaurants. The
supervisors report directly to the Vice President of Operations. Communication
and support from all departments in the Company are designed to assist the
supervisors in responding promptly to local problems and opportunities.

All restaurant managers and supervisors participate in incentive programs
based upon the profitability of their restaurants and upon the achievement of
certain pre-set goals. The Company believes these incentive programs enable it
to operate more efficiently and to attract qualified managers. In 1999, the
Company implemented an operating partner program for certain managers to provide
them with an additional career path and give them increased incentive to
maximize the profitability of their restaurants. The Company currently has two
operating partners participating in this program.

Purchasing, Quality and Cost Control. The Company has a centralized
purchase control program which is designed to ensure uniform product quality in
all restaurants. The program also helps to maintain reduced food, beverage, and
supply costs. The Company purchases approximately 95% of the products used by
the Company's restaurants through the centralized purchase control program. USDA
choice or select grain-fed beef, the Company's primary commodity, is closely
monitored by the Company for advantageous purchasing and quality control. The
Company purchases beef through various producers and brokers both on a contract
basis and on a spot basis. Beef and other products are generally delivered
directly to the restaurants three times weekly. The Company has in the past


6


obtained satisfactory sources of supply for all the items it regularly uses and
believes it will be able to do so in the future.

The Franchise Agreement requires that all suppliers to Ryan's restaurants
are subject to approval by the Franchisor. Through its relationship with the
Franchisor, the Company has obtained favorable pricing on the purchase of food
products from several suppliers. The Company has used Alliant Foodservice, Inc.
as its primary supplier since 1991. Alliant was purchased by U.S. Foods, Inc in
2001. The U.S. Foods agreement is cancelable at any time with 90 days notice.

The Company maintains centralized financial and accounting controls for its
restaurants. On a daily basis, restaurant managers forward customer counts,
sales information and supplier invoices to Company headquarters. On a weekly
basis, restaurant managers forward summarized sales reports and payroll data.
Physical inventories of all food and supply items are taken weekly, and meat is
inventoried daily.

Development

General. The Company operated 23 Ryan's restaurants as of February 15,
2002.

Site Location and Construction. The Company considers the specific location
of a restaurant to be important to its long-term success. The Company's
Franchisor has in the past assisted the Company in selection of new restaurant
sites. The site selection process focuses on a variety of factors, including
trade area demographics (such as population density and household income level),
an evaluation of site characteristics (such as visibility, accessibility, and
traffic volume), proximity to large retailers and an analysis of the potential
competition. In addition, site selection is influenced by the general proximity
of a site to other Ryan's restaurants in order to improve the efficiency of the
Company's field supervisors and potential marketing programs. The Company
generally locates its restaurants near or adjacent to residential areas in an
effort to capitalize on repeat business from such areas as opposed to transient
business.

For most of the Company's new restaurants built in recent years, the
Company used a general contractor selected from several solicited bids. For the
Company's newest restaurant opened in December 2001, the Company used its
construction subsidiary as the general contractor in order to expedite the

7


process of obtaining building permits. New Ryan's restaurants are usually
completed within four months of the date on which construction is commenced.

Management of New Restaurants. When a new Ryan's restaurant is opened, the
principal restaurant management positions are staffed primarily with management
personnel who have prior experience in a management position at another of the
Company's restaurants and who have undergone special training. Prior to opening,
all staff personnel at the new location undergo one week of intensive training
conducted by a training team. Such training includes preopening drills in which

test meals are served to the invited public. Both the staff at the new location
and personnel experienced in store openings at other locations participate in
the training and drills.

Proprietary Trade Marks

The name "Ryan's Family Steak House," along with all ancillary signs,
building design and other symbols used in conjunction with the name, are the
primary trademarks and service marks of the Franchisor. Such marks are
registered in the United States. All of these registrations and the goodwill
associated with the Franchisor's trademarks are of material importance to the
Company's business and are licensed to the Company under the Franchise
Agreement.

Competition

The food service business in Florida is highly competitive and is often
affected by changes in the taste and eating habits of the public, economic
conditions affecting spending habits, local demographics, traffic patterns and
local and national economic conditions. The principal bases of competition in
the industry are the quality and price of the food products offered. Location,
speed of service and attractiveness of the facilities are also important
factors. The Company's restaurants are in competition with restaurants operated
or franchised by national, regional and local restaurant companies offering a
similar menu, many of which have greater resources than the Company. The Company
is also in competition with specialty food outlets and other vendors of food.
With the termination of the Company's exclusive rights in North and Central
Florida, the Company could experience competition from its franchisor.

The amount of new competition near Company restaurants has increased
significantly in the past few years. In some cases, competitors have opened new


8


restaurants with superior facilities close to the Company's restaurants. In
addition, in the past several years, many competitors have remodeled their
restaurants so that they are similar to the scatter bar format used by the
Company. Management has developed strategies to attempt to reduce the negative
impact on sales from new competition, but there can be no assurance that sales
trends will improve. The strategies implemented include the installation a
display cooking area in the Company's last three new restaurants and three
remodeled restaurants, which have to date produced positive sales results.
Management is evaluating the results of the remodeled restaurants to determine
whether to add the display cooking area to more restaurants in 2002. In
addition, the Franchisor recently exercised its option to build restaurants in
the Company's territory, (see preceding discussion under "Franchise Agreement")
and does operate three restaurants in west Florida in its existing territory.

Employees

As of January 2, 2002, the Company employed approximately 1,300 persons, of
whom approximately 50% are considered by management as part-time employees. No
labor unions currently represent any of the Company's employees. The Company has
not experienced any work stoppages attributable to labor disputes and considers
employee relations to be good.

Executive Officers

The following persons were executive officers of the Company effective
January 2, 2002:

Edward B. Alexander, age 43, has been Executive Vice President since
September 1999, and has been Chief Financial Officer of the Company since 1990.
In addition, Mr. Alexander served on the Company's Board of Directors from May
1996 to July 1999.

Kevin R. Pickett, age 42, has been Vice President of Operations of the
Company since September 1999, and Director of Operations of the Company since
August 1996. Mr. Pickett served as regional supervisor for the Company from July
1993 to August 1996, and was a manager of various Company restaurants from
October 1988 to June 1993.


9



Government Regulation

The Company is subject to the Fair Labor Standards Act which governs such
matters as minimum wage requirements, overtime and other working conditions. A
large number of the Company's restaurant personnel are paid at or slightly above
the federal minimum wage level and, accordingly, any change in such minimum wage
will affect the Company's labor costs. Costs of food, beverage, and labor are
the expenses most affected by inflation in the Company's business. Although
inflation in recent years has been low and accordingly has not had a significant
impact on the Company, there can be no assurance that inflation will not
increase and impact the Company in the future.

A significant portion of the Company's employees are paid by the federally
established statutory minimum wage. Although no minimum wage increases have been
signed into law, various proposals are presently being considered in the United
States Congress. Such changes in the federal minimum wage would impact the
Company's payroll and benefits costs. The Company is typically able to increase
its menu prices to cover most of the payroll rate increases; however, there can
be no assurance that menu price increases will be able to offset labor cost
increases in the future. Annual sales price increases have consistently ranged
from 1.0% to 3.0%.

The Company is also subject to the Equal Employment Opportunity Act and a
variety of federal and state statutes and regulations. Any new legislation or
regulation that may require the Company to pay more in health insurance premiums
may adversely affect the Company's labor costs. The Company's restaurants are
constructed to meet local and state building requirements and are operated in
accordance with state and local regulations relating to the preparation and
service of food. More stringent and varied requirements of local governments
with respect to land use, zoning and environmental factors may in some cases
delay the Company's construction of new restaurants or remodels of existing
ones.

The Company believes that it is in substantial compliance with all
applicable federal, state and local statutes, regulations and ordinances
including those related to protection of the environment and that compliance has
had no material effect on the Company's capital expenditures, earnings or
competitive position, and such compliance is not expected to have a material
adverse effect upon the Company's operations. The Company, however, cannot
predict the impact of possible future legislation or regulation on its
operations.

10


Sources and Availability of Raw Materials

The Company procures its food and other products from a variety of
suppliers, and follows a policy of obtaining its food and products from several
major suppliers under competitive terms. A substantial portion of the beef used
by the Company is obtained from one supplier, although the Company believes
comparable beef meeting its specifications is available in adequate quantities
from other suppliers. To insure against interruption in the flow of food
supplies due to unforeseen or catastrophic events, to take advantage of
favorable purchasing opportunities, and to ensure that meat received by the
Company is properly aged, the Company maintains a two to six-week supply of
beef.

Working Capital Requirements

Substantially all of the Company's revenues are derived from cash sales.
Inventories are purchased on credit and are converted rapidly to cash. The
Company does not maintain significant receivables and inventories. Therefore,
with the exception of debt service, working capital requirements for continuing
operations are not significant.

Long-Term Debt

Beginning in December 1996, the Company entered into a series of loan
agreements with FFCA Mortgage Corporation, (now known as GE Capital Franchise
Finance Corporation ("GE Capital"). As of January 2, 2002, the outstanding
balance due under the Company's various loans with GE Capital was $20,565,900.
The weighted average interest rate for the GE Capital loans is 7.47% at January
2, 2002. The Company used the proceeds of the GE Capital loans primarily to
refinance its debt and to fund construction of new restaurants.

The Company used the proceeds of the GE Capital loans in 1996 to retire its
Notes with Cerberus Partners, L.P. ("Cerberus") and its loans with the Daiwa
Bank Limited and SouthTrust Bank of Alabama, N.A. In addition, the Company
retired Warrants for 210,000 shares of the Company's common stock previously
held by Cerberus. Cerberus continues to hold Warrants to purchase 140,000 shares
of the Company's common stock at an exercise price of $2.00 per share.


11


The Company currently has no financing commitment from GE Capital.
Management intends to explore alternative financing methods, including sale
leaseback financing and developer-funded leases in addition to seeking
additional loan commitments from GE Capital in order to fund construction of new
restaurants and remodeling of existing restaurants.

Seasonality

The Company's operations are subject to seasonal fluctuations. Revenues per
restaurant generally increase from January through April and decline from
September through December.

Research

The Company relies primarily on the Franchisor to maintain ongoing research
programs relating to the development of new products and evaluation of marketing
activities. Although research and development activities are important to the
Company, no expenditures for research and development have been incurred by the
Company.

Customers

No material part of the Company's business is dependent upon a single
customer or a few customers.

Information as to Classes of Similar Products or Services

The Company operates in only one industry segment. All significant revenues
and pre-tax earnings relate to retail sales of food to the general public
through restaurants owned and operated by the Company. The Company has no
operations outside the continental United States.









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ITEM 2. PROPERTIES
- ------- ----------

Location Date Opened
-------- -----------

Jacksonville May 1982
Ocala September 1986
Neptune Beach November 1986
Lakeland February 1987
Lakeland March 1987
Winter Haven August 1987
Apopka September 1987
Gainesville December 1987
New Port Richey May 1988
Tampa June 1988
Tallahassee August 1988
Daytona Beach September 1988
Tampa November 1988
Orlando February 1989
Melbourne October 1989
Lake City March 1991
Brooksville January 1997
Leesburg June 1998
Deland April 1999
Tampa September 1999
St. Cloud December 2000
Titusville May 2001
Jacksonville December 2001

As of February 15, 2002, the Company operated 23 Ryan's restaurants. The
specific rate at which the Company is able to open new restaurants will be
determined, among other factors, by its ability to locate suitable sites on
satisfactory terms, raise the necessary capital, secure appropriate governmental
permits and approvals and recruit and train management personnel.

As of January 2, 2002, the Company owned the real property on which 19 of
its restaurants were located. All of these properties are subject to mortgages
securing the GE Capital notes.

The Company leases the real property on which four of its restaurants are
located. Those restaurants are located in Jacksonville, Brooksville, Leesburg,
and Tampa, Florida. The Company also leases two buildings in Jacksonville,
Florida for its executive offices.


13


ITEM 3. LEGAL PROCEEDINGS
- ------- -----------------

The Company is subject from time to time to various pending legal
proceedings arising in the normal course of business. In the opinion of
management, based on the advice of legal counsel, the ultimate disposition of
currently pending claims and litigation will not have material adverse effect on
the financial position or results of operations of the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ------- ---------------------------------------------------

None.

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
- ------- -----------------------------------------------------------------------
MATTERS
- -------

The information contained under the caption "Common Stock Data" in the
Company's 2001 Annual Report to Shareholders is incorporated herein by
reference.

ITEM 6. SELECTED FINANCIAL DATA

The information contained under the caption "Five Year Financial Summary"
in the Company's 2001 Annual Report to Shareholders is incorporated herein by
reference.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
- ------- -----------------------------------------------------------------------
OF OPERATIONS
- -------------

The information contained under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the Company's 2001
Annual Report to Shareholders is incorporated herein by reference.

ITEM 7.A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT RISK
- -------- ---------------------------------------------------

The information contained under the caption "Quantitative and Qualitative
Disclosure About Risk" in the Company's 2001 Annual Report to Shareholders is
incorporated herein by reference.


14



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- ------- -------------------------------------------

Financial Statements

The Consolidated Financial Statements of the Company and the Report of
Independent Certified Public Accountants as contained in the Company's 2001
Annual Report to Shareholders are incorporated herein by reference.

Supplementary Data

Following is a summary of the quarterly results of operations for the years
ended January 2, 2002 and January 3, 2001:

Fiscal Quarter
$ In thousands, First Second Third Fourth Total
except per share amounts

2001
Sales $ 11,540 $ 10,637 $ 10,099 $ 9,777 $ 42,053
Earnings (loss) from
operations 784 249 (59) (147) 827
Net earnings (loss) 268 (582) (397) (575) (1,286)
Basic earnings (loss)
per share .11 (.24) (.16) (.18) (.49)
Diluted earnings (loss)
per share .11 (.24) (.16) (.18) (.49)

2000
Sales $ 10,591 $ 10,180 $ 9,249 $ 9,940 $ 39,960
Earnings (loss) from
operations 706 515 (45) (19) 1,157
Net earnings (loss) 538 275 (343) (517) (47)
Basic earnings (loss)
per share .22 .11 (.14) (.21) (.02)
Diluted earnings (loss)
per share .22 .11 (.14) (.21) (.02)

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
- ------- -----------------------------------------------------------------------
FINANCIAL DISCLOSURE.
- ---------------------

None.
PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- -------- --------------------------------------------------

The information regarding directors contained under the caption "Election
of Directors" in the Company's Proxy Statement for the 2002 Annual Meeting of
Shareholders, which will be filed with the Securities and Exchange Commission by
May 2, 2002, is incorporated herein by reference.


15


The information regarding executive officers is set forth in Item 1 of this
report under the caption "Executive Officers."

The information regarding reports required under section 16(a) of the
Securities Exchange Act of 1934 contained under caption "Section 16(a)
Beneficial Ownership Reporting Compliance" in the Company's proxy statement for
the 2002 Annual Meeting of Shareholders, which will be filed with Securities and
Exchange Commission by May 2, 2002 is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION
- -------- ----------------------

The information contained under the caption "Executive Pay" in the
Company's Proxy Statement for the 2002 Annual Meeting of Shareholders, which
will be filed with the Securities and Exchange Commission by May 2, 2002, is
incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- -------- --------------------------------------------------------------

The information contained under the captions "Security Ownership of Certain
Beneficial Owners and Management" in the Company's Proxy Statement for the 2002
Annual Meeting of Shareholders, which will be filed with the Securities and
Exchange Commission by May 2, 2002, is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- -------- ----------------------------------------------

The information contained under the captions "Election of Directors -
Certain Relationships and Related Transactions" and "Compensation Committee
Interlocks and Insider Participation" in the Company's Proxy Statement for the
2002 Annual Meeting of Shareholders, which will be filed with the Securities and
Exchange Commission by May 2, 2002, is incorporated herein by reference.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
- -------- ----------------------------------------------------------------

(a)1. The financial statements listed below are filed with this
report on Form 10-K or are incorporated herein by reference from
the Company's 2001 Annual Report to Shareholders. With the


16


exception of the pages listed below, the 2001 Annual Report to
Shareholders is not deemed "filed" as a part of this report on
Form 10-K.

Page
Reference
---------

Form 2001
10-K Annual Report
---- -------------

Consent of Independent Certified
Public Accountants 22
Independent Auditors' Report 29
Consolidated Statements of Operations 12
Consolidated Balance Sheets 13
Consolidated Statements of Share-
holders' Equity 14
Consolidated Statements of Cash Flows 15
Notes to Consolidated Financial
Statements 16

(a)2. No financial statement schedules have been included since the
required information is not applicable or the information
required is included in the financial statements, the notes
thereto, or Item 8 of this report.

(a)3. The following exhibits are filed as part of this report on Form 10-K, and
this list comprises the Exhibit Index.

No. Exhibit
- --- -------

3.01 Articles of Incorporation of Family Steak Houses of Florida, Inc.
(Exhibit 3.01 to the Company's Registration Statement on Form S-1,
Registration No. 33-1887, is incorporated herein by reference.)

3.02 Bylaws of Family Steak Houses of Florida, Inc. (Exhibit 3.02 to the
Company's Registration Statement on Form S-1, Registration No. 33-1887,
is incorporated herein by reference.)

3.03 Articles of Amendment to the Articles of Incorporation of Family Steak
Houses of Florida, Inc. (Exhibit 3.03 to the Company's Registration
Statement on Form S-1, Registration No. 33-1887, is incorporated herein
by reference.)


17


3.04 Articles of Amendment to the Articles of Incorporation of Family Steak
Houses of Florida, Inc. (Exhibit 3.04 to the Company's Registration
Statement on Form S-1, Registration No. 33-1887, is incorporated herein
by reference.)

3.05 Amended and Restated Bylaws of Family Steak Houses of Florida, Inc.
(Exhibit 4 to the Company's Form 8-A, filed with the Commission on
March 19, 1997, is incorporated herein by reference.)

3.06 Articles of Amendment to the Articles of Incorporation of Family Steak
Houses of Florida, Inc. (Exhibit 3 to the Company's Form 8-A filed with
the Commission on March 19, 1997, is incorporated herein by reference.)

3.07 Articles of Amendment to the Articles of Incorporation of Family Steak
Houses of Florida, Inc. (Exhibit 3.08 to the Company's Annual Report on
Form 10-K filed with the Commission on March 31, 1998 is incorporated
herein by reference.)

3.08 Amendment to Bylaws of Family Steak Houses of Florida, Inc. (Exhibit
3.08 to the Company's Annual Report on Form 10-K filed with the
Commission on March 15, 2000 is incorporated herein by reference.)

4.01 Specimen Stock Certificate for shares of the Company's Common Stock
(Exhibit 4.01 to the Company's Registration Statement on Form S-1,
Registration No. 33-1887, is incorporated herein by reference.)

10.01 Amended Franchise Agreement between Family Steak Houses of Florida,
Inc. and Ryan's Family Steak Houses, Inc., dated September 16, 1987.
(Exhibit 10.01 to the Company's Registration Statement on Form S-1,
filed with the Commission on October 2, 1987, Registration No.
33-17620, is incorporated herein by reference.)

10.02 Lease regarding the restaurant located at 3549 Blanding Boulevard,
Jacksonville, Florida (Exhibit 10.03 to the Company's Registration
Statement on Form S-1, Registration No. 33-1887, is incorporated herein
by reference.)

10.03 Amended and Restated Warrant to Purchase Shares of Common Stock, void
after October 1, 2003, which represents warrants issued to The Phoenix
Insurance Company, The Travelers Indemnity Company, and The Travelers


18


Insurance Company, (subsequently transferred to Cerberus Partners,
L.P.) (Exhibit 10.07 to the Company's Annual Report on Form 10-K, filed
with the Commission on March 28, 1995, is incorporated herein by
reference.)

10.04 Warrant to Purchase Shares of Common Stock, void after October 1, 2003,
which represents warrants issued to The Phoenix Insurance Company, The
Travelers Indemnity Company, and The Travelers Insurance Company.
(subsequently transferred to Cerberus Partners, L.P.) (Exhibit 10.08 to
the Company's Annual Report on Form 10-K, filed with the Commission on
March 28, 1995, is incorporated herein by reference.)

10.05 Amendment of Franchise Agreement between Ryan's Family Steak Houses,
Inc. and the Company dated July 11, 1994. (Exhibit 10.17 to the
Company's Annual Report on Form 10-K, filed with the Commission on
March 28, 1995, is incorporated herein by reference.)

10.06 Agreement between the Company and Kraft Foodservice, Inc., as the
Company's primary food product distribution. (Exhibit 10.06 to the
Company's Quarterly Report on Form 10-Q, filed with the Commission on
August 9, 1995, is incorporated herein by reference.)

10.07 Lease Agreement between the Company and CNL American Properties Fund,
Inc., dated as of September 18, 1996. (Exhibit 10.02 to the Company's
Quarterly Report on Form 10-Q, filed with the Commission on November
18, 1996 is hereby incorporated by reference.)

10.08 Rent Addendum to Lease Agreement between the Company and CNL American
Properties Fund, Inc., dated as of September 18, 1996. (Exhibit 10.04
to the Company's Quarterly Report on Form 10-Q, filed with the
Commission on November 18, 1996 is hereby incorporated by reference.)

10.09 Amendment of Franchise Agreement between the Company and Ryan's Family
Steak Houses, Inc. dated October 3, 1996. (Exhibit 10.15 to the
Company's Annual Report on Form 10-K, filed with the Commission on
April 1, 1997 is hereby incorporated by reference.)

10.10 $15.36m Loan Agreement, between the Company and FFCA Mortgage
Corporation, dated December 18, 1996. (Exhibit 10.18 to the Company's
Annual Report on Form 10-K, filed with the Commission on April 1, 1997
is hereby incorporated by reference.)


19


10.11 $4.64m Loan Agreement, between the Company and FFCA Mortgage
Corporation, dated December 18, 1996. (Exhibit 10.19 to the Company's
Annual Report on Form 10-K, filed with the Commission on April 1, 1997
is hereby incorporated by reference.)

10.12 Form of Promissory Note between the Company and FFCA Mortgage
Corporation, dated December 18, 1996. (Exhibit 10.20 to the Company's
Annual Report on Form 10-K, filed with the Commission on April 1, 1997
is hereby incorporated by reference.)

10.13 Form of Mortgage between the Company and FFCA Mortgage Corporation,
dated December 18, 1996 (Exhibit 5 to the Company's Schedule 14D-9,
filed with the Commission on March 19, 1997 is hereby incorporated by
reference.)

10.14 Form of Mortgage between the Company and FFCA Mortgage Corporation,
dated March 18, 1996. (Exhibit 10.22 to the Company's Annual Report on
Form 10-K, filed with the Commission on April 1, 1997 is hereby
incorporated by reference.)

10.15 Lease agreement dated January 29, 1998 between the Company and Excel
Realty Trust, Inc. (Exhibit 10.19 to the Company's Annual Report on
Form 10-K, filed with the Commission on March 31, 1998 is hereby
incorporated by reference.)

10.16 Lease between the Company and Stuart S. Golding Company dated February
3, 1999. (Exhibit 10.23 to the Company's Annual Report on Form 10-K,
filed with the Commission on March 24, 1999 is hereby incorporated by
reference).

10.17 Amendment of Franchise Agreement between the Company and Ryan's Family
Steak Houses, Inc. dated August 31, 1999. (Exhibit 10.19 to the
Company's Annual Report on Form 10-K filed with the Commission on March
15, 2000 is incorporated herein by reference.)

10.18 Stock option agreement between the Company and director Jay Conzen,
dated November 3, 1999. (Exhibit 10.20 to the Company's Annual Report
on Form 10-K filed with the Commission on March 15, 2000 is
incorporated herein by reference.)


20


10.19 Amendment to Franchise Agreement between the Company and Ryan's
Properties, inc. dated January 30, 2002.

13.01 2001 Annual Report to Shareholders.

21.01 Subsidiaries of the Company.

23.0l Consent of Independent Certified Public Accountants - Deloitte & Touche
LLP.

(b) None.

(c) See (a)3. above for a list of all exhibits filed herewith and the
Exhibit Index.

(d) None.

21




INDEPENDENT AUDITORS' CONSENT
- -----------------------------

We consent to the incorporation by reference in this Annual Report of Family
Steak Houses of Florida, Inc. on Form 10-K of our report dated February 15,
2002, appearing in the 2001 Annual Report to Shareholders of Family Steak Houses
of Florida, Inc.

We additionally consent to the incorporation by reference in Registration
Statement No. 33-11684 pertaining to the 1986 Employee Incentive Stock Option
Plan of Family Steak Houses of Florida, Inc. on Form S-8 of our report dated
February 15, 2002 and incorporated by reference in this Annual Report on Form
10-K of Family Steak Houses of Florida, Inc. for the year ended January 2, 2002.

We further consent to the incorporation by reference in Registration Statement
No. 33-12556 pertaining to the 1986 Stock Option Plan for Non-Employee Directors
of Family Steak Houses of Florida, Inc. on Form S-8 of our report dated February
15, 2002 and incorporated by reference in this Annual Report on Form 10-K of
Family Steak Houses of Florida, Inc. for the year ended January 2, 2002.

We further consent to the incorporation by reference in Registration Statement
No. 33-62101 pertaining to the 1995 Long Term Incentive Plan of Family Steak
Houses of Florida, Inc. on Form S-8 of our report dated February 15, 2002 and
incorporated by reference in this Annual Report on Form 10-K of Family Steak
Houses of Florida, Inc. for the year ended January 2, 2002.



Deloitte & Touche LLP
Certified Public Accountants

Jacksonville, Florida
March 27, 2002


22




SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

FAMILY STEAK HOUSES OF FLORIDA, INC.
Date: March 9, 2002 BY: /s/ Glen F. Ceiley
------------------
Glen F. Ceiley
(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the Registrant in the
capacities and on the date indicated.

Signature Title Date
- --------- ----- ----

/s/ Edward B. Alexander Executive Vice President 3/8/02
- ----------------------- (Principal Financial and
Edward B. Alexander Accounting Officer)



/s/ Glen F. Ceiley Chairman of the Board 3/8/02
- ------------------
Glen F. Ceiley


/s/ Steve Catanzaro Director 3/8/02
- -------------------
Steve Catanzaro


/s/ Jay Conzen Director 3/8/02
- --------------
Jay Conzen


/s/ William Means Director 3/8/02
- -----------------
William Means


23