SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(MARK ONE)
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE FISCAL YEAR ENDED DECEMBER 27, 2004
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
COMMISSION FILE NUMBER 1-9684
AM-CH, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE |
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33-0147725 |
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(STATE OR OTHER JURISDICTION |
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(I.R.S. EMPLOYER |
2 North Riverside, 7th Floor
Chicago, Illinois 60606
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES, INCLUDING ZIP CODE)
Registrant’s telephone number including area code: (312) 466-3966
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
INDICATE BY CHECK MARK WHETHER REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED BY SECTION 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 ý NO o
INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM 405 OF REGULATION S-K ((S) 229.405 OF THIS CHAPTER) 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. ý
INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS AN ACCELERATED FILER (AS DEFINED IN EXCHANGE ACT RULE 12b-2 OF THE ACT). YES o NO ý
The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant (based upon the per share closing sale price of $.83 on June 28, 2004, and for the purpose of this calculation only, the assumption that all of the registrant’s directors and executive officers are affiliates) was approximately $1.6 million. The number of shares outstanding of common stock as of March 30, 2005 was 2,005,131.
DOCUMENTS INCORPORATED BY REFERENCE
None.
CONTENT OUTLINE FOR COMPANY’S
2004 FORM 10-K FILING
TABLE OF CONTENTS
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This Annual Report on Form 10-K and the documents incorporated herein by reference contain forward-looking statements that have been made pursuant to provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent the Company’s expectations or beliefs concerning future events, including any statements regarding: future sales and gross profit percentages, the continuation of historical trends, the sufficiency of the Company’s cash balances, and cash generated from operating, financing and/or investing activities for the Company’s future liquidity and capital resource needs. Without limiting the foregoing, the words “believes,” “intends,” “projects,” “plans,” “expects,” “anticipates,” and similar expressions are intended to identify forward-looking statements. The Company cautions that these statements are further qualified by important economic and competitive factors that could cause actual results to differ materially from those in the forward-looking statements. These factors include, without limitation, risks of the restaurant industry, an industry with many well-established competitors with greater financial and other resources than the Company, and the impact of changes in consumer trends, employee availability, and cost increases. Accordingly, such forward-looking statements do not purport to be predictions of future events or circumstances and may not be realized.
ITEM 1. BUSINESS.
GENERAL
AM-CH, Inc. formerly known as Angelo and Maxie’s, Inc. and Chart House Enterprises, Inc. (the “Company”), has sold or closed all of it’s restaurants and has no ongoing business operations. In accordance with the stockholder approved “Plan of Dissolution”, the Company has filed a certificate of dissolution with the State of Delaware on February 2, 2005 and is in the process of winding up its affairs. The Company was incorporated in Delaware in 1985. The Company’s headquarters are located in Chicago, Illinois.
SALE OF THE CHART HOUSE BUSINESS
In 1961, the Company commenced operations with the opening of the first Chart House restaurant in Aspen, Colorado by a predecessor of the Company. The Company was established in 1985 as a vehicle to acquire the 54 unit Chart House brand from a predecessor, as well as two other concepts subsequently disposed of by the Company. The Chart House brand grew to a peak of 63 domestic units located in 21 states as well as Puerto Rico and the U.S. Virgin Islands. The Company also opened its higher-priced Peohe’s restaurant in January 1988, in Coronado, California. In early 1998, the Company began forming a new management team that developed and executed an operational strategy, which included: disposal of restaurants that did not meet sales and profitability standards, demographic requirements, or geographic fit; completion of a $31 million renovation program during 1998-2000 to remodel the remaining restaurants; re-engineering of the menu to a predominately fresh seafood focus; and enhanced information systems.
In December 2001, the Board of Directors of the Company responded to the recessionary economic environment, the Company’s limited access to capital, and the near-term maturity of the Company’s senior, secured debt by retaining a financial advisor to initiate a review of strategic alternatives, including a possible sale of the Company.
In May 2002, the Board of Directors authorized the sale of the remaining 38 Chart House restaurants and one Peohe’s restaurant (the “Chart House Business”) to a subsidiary of a publicly-traded restaurant company (the “Purchaser”). The sale received the approval of the Company’s stockholders at a special meeting held as of July 30, 2002, and closed on the same date. At the special meeting, the Company’s stockholders also approved the change of the Company’s name from Chart House Enterprises, Inc. to Angelo and Maxie’s, Inc. The Company received consideration of approximately $55.3 million, consisting of cash and the assumption of approximately $3.1 million of certain current liabilities. The Company used a portion of the proceeds to repay all amounts outstanding on its senior, secured Revolving Credit and Term Loan Agreement (the “Credit Agreement”) and a subordinated note owed to a related party.
ANGELO AND MAXIE’S STEAKHOUSE
In April 1999, the Company acquired the Angelo and Maxie’s Steakhouse located at 233 Park Avenue South in New York, New York. The Company expanded the concept by opening four additional restaurants during 2000 located in New York (Midtown), New York, Atlanta, Georgia (subsequently closed in 2001), Washington, DC, and Phoenix, Arizona
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(subsequently closed in December 2002). The Company opened two additional restaurants during 2001 located in West Palm Beach, Florida (subsequently closed in November 2004) and Reston, Virginia.
SALE OF THE ANGELO AND MAXIE’S BRAND AND RELATED OPERATING ASSETS
In August 2003, the Board of Directors approved the sale of three of the Company’s then-existing five steakhouses which were located in Midtown Manhattan, New York, Reston, Virginia, and Washington, D.C. The purchaser, McCormick and Schmick Restaurant Corp. (“M&S”), converted all three steakhouses to another restaurant concept following the sale. On January 7, 2004, the sale was consummated for approximately $5.6 million.
In September 2003, the Board of Directors approved a proposal to sell the Company’s remaining two steakhouses and certain Angelo and Maxie’s intellectual property. The Company executed a definitive agreement with A & M Acquisitions, LLC on June 22, 2004, for the sale of its remaining two steakhouses located on Park Avenue in New York City and in West Palm Beach, Florida, including all the rights to the name “Angelo and Maxie’s.” The agreement was approved by the Company’s stockholders in September, 2004. Following the closure of the West Palm Beach, Florida restaurant and the termination of the related lease, the definitive agreement with A&M Acquisitions, LLC was amended to exclude the sale of the West Palm Beach, Florida restaurant. The sale of the Park Avenue restaurant was consummated on November 30, 2004 and the Company received approximately $4.5 million. After the completion of the sale, the Company’s name was changed to AM-CH, Inc.
OPERATIONS
As noted above the Company no longer operates any restaurants and is currently in the process of dissolving and winding up its affairs. The Company has only one employee who is responsible for resolving any remaining issues as well as complying with any applicable regulatory requirements.
GOVERNMENT REGULATION
The Company believes it is operating in compliance with applicable laws, regulations, and administrative practices governing its operations.
EMPLOYEES
At December 27, 2004, the Company had two employees at the corporate office located in Chicago, Illinois. One of the remaining two employees was terminated on February 1, 2005.
ITEM 2. PROPERTIES.
On June 30, 2003, the Company’s lease on its corporate headquarters in Chicago, Illinois expired and the Company relocated to a space commensurate with its current needs. The Company entered into an operating lease on its new corporate headquarters on June 26, 2003. This new operating lease is terminable with 30 days notice.
ITEM 3. LEGAL PROCEEDINGS
The Company periodically is a defendant in litigation incidental to its business activities. While any litigation or investigation has an element of uncertainty, the Company believes that the outcome of any of these matters will not have a material adverse effect on its financial condition or operations. No matters were pending nor threatened to the best knowledge of the Company as of March 30, 2005.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report.
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ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
The Company’s common stock, par value $0.01 per share (the “Common Stock”) is quoted on the NASD OTC Bulletin Board under the trading symbol AMHN.OB. On March 30, 2005, there were approximately 655 holders of record of the Company’s Common Stock. The Company has not paid any cash dividends on its Common Stock during the last two fiscal years and does not anticipate paying cash dividends on its Common Stock in the foreseeable future. The Company can not declare or pay any dividends on the Common Stock so long as any shares of the Preferred Stock are outstanding, unless, in each case, the full amount of accrued and unpaid dividends (whether or not declared) on all outstanding shares of the Preferred Stock for all dividend periods ending on or before the date of payment of such dividend have been paid or set apart for payment or contemporaneously are declared and paid.
In connection with the dissolution of the Company, its stock transfer books were closed as of the end of trading on February 7, 2005, on which date the Company ceased recording transfers of shares of its Common and Preferred Stock and issuing shares of its Common Stock upon the exercise of options to purchase Common Stock. The record date for purposes of determining stockholders who will be eligible to participate in any distributions made by the Company in connection with the dissolution and liquidation of the Company is February 7, 2005.
Under the Plan of Dissolution, prior to making any distributions to its stockholders, the Company is required to pay or make reasonable provision to pay, all claims and obligations of the Company.
In addition, in connection with the dissolution of the Company, holders of the Company’s Preferred Stock will be entitled to liquidating payments before any payment is made to holders of Common Stock. The amount per share of the liquidating payment to holders of Preferred Stock will be the greater of (a) $2.25, plus all accrued but unpaid dividends to date, plus a ratable distribution of any remaining assets and funds along with holders of the Company’s other equity securities (on an as-converted basis), provided that the additional distribution to such holders will not exceed $4.0 million in the aggregate, subject to reduction in certain circumstances; or (b) the amount determined by dividing (i) the total amount available of distribution by (ii) the total number of outstanding shares of Common Stock, determined on an as-converted basis.
The Company is not able to predict whether any distributions will be made to its stockholders in connection with the dissolution, or if such distributions are made, the amount or timing thereof. The Company believes that if any such distributions are made, it is likely they would not be made until late in 2005.
The following table sets forth the quarterly high and low sales prices for a share of the Company’s Common Stock for the two most recent fiscal years:
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2004 |
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High |
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Low |
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Fourth quarter |
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$ |
0.79 |
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$ |
0.53 |
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Third quarter |
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$ |
1.10 |
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$ |
0.66 |
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Second quarter |
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$ |
1.45 |
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$ |
0.82 |
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First quarter |
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$ |
1.90 |
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$ |
1.35 |
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2003 |
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High |
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Low |
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Fourth quarter |
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$ |
3.10 |
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$ |
1.60 |
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Third quarter |
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$ |
3.15 |
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$ |
2.45 |
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Second quarter |
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$ |
2.95 |
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$ |
2.30 |
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First quarter |
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$ |
3.50 |
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$ |
2.85 |
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ITEM 6. SELECTED FINANCIAL DATA.
The Company has sold or closed all its restaurants as of December 27, 2004 and filed a certificate of dissolution with the State of Delaware on February 2, 2005. As such the following financial information presents the operations of the restaurants that were sold or closed during the fiscal year as discontinued operations.
Selected Financial Data
(In thousands, except per share and number of restaurants data)
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2004 |
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2003 |
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2002 |
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2001 |
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2000 |
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Statements of operations data: |
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Impairment of assets and restructuring charges |
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$ |
(3,229 |
) |
$ |
(5,728 |
) |
$ |
(7,596 |
) |
$ |
(5,699 |
) |
$ |
(3,810 |
) |
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Interest expense, net |
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(72 |
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(112 |
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(2,615 |
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(4,772 |
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(2,901 |
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Other income |
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204 |
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204 |
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202 |
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1,080 |
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75 |
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Loss before discontinued operations |
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(3,097 |
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(5,636 |
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(10,009 |
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(9,391 |
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(6,636 |
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Loss from discontinued operations |
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(1,057 |
) |
(289 |
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(1,691 |
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(10,602 |
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(3,790 |
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Net Loss |
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(4,154 |
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(5,925 |
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(11,700 |
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(19,993 |
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(10,426 |
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Loss from discontinued operations per common share |
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(0.53 |
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(0.14 |
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(0.85 |
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(5.38 |
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(1.93 |
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Net Loss per common share |
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(2.53 |
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(3.44 |
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(6.37 |
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(10.37 |
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