RAVE Restaurant Group, Inc. (NASDAQ:RAVE) Files An 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
Item 2.03
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Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant |
“Company”) obtained a $1.0 million loan from its largest
shareholder, Newcastle Partners, LP (“Newcastle”), evidenced by
a Promissory Note. The loan bears interest at 10% per annum and
is due and payable on April 30, 2017. Newcastle is an affiliate
of the Company’s Chairman, Mark E. Schwarz, and its Interim
President and Chief Executive Officer, Clinton J. Coleman.
entirety by reference to the Promissory Note filed as Exhibit 4.1
hereto and incorporated herein by this reference.
approved a proposed rights offering to its existing shareholders
and, in connection therewith, declared a dividend of subscription
rights (“Rights”) to holders of record of its common stock as
of December 21, 2016, to purchase 4% Convertible Senior Notes due
2022, par $100 (“Notes”). Shareholders will be issued 0.2817%
of a Right per share of the common stock held on the record date
(i.e., one Right for each 355 shares); provided, however, that
the number of Rights will be rounded to the nearest whole number
and no fractional Rights will be issued. Each whole Right will
entitle the holder to purchase one Note at the par value of $100
each. The Notes will be convertible into shares of common stock
at a conversion price of $2.00 per share (i.e., 50 shares of
common stock per Note). The subscription rights become
exercisable upon the date that a registration statement covering
the Notes and shares of common stock into which they are
convertible is declared effective, or such later date as may be
determined by the Chairman or the President of the Company.
Rights for a minimum of $1,000,000 and a maximum of $3,000,000 in
principal amount of the Notes. The net proceeds of the proposed
rights offering are intended to be used to repay the loan from
Newcastle, to fund continued restaurant development activity and
to provide working capital for general corporate purposes.
on Form S-3 with respect to the proposed rights offering of the
Notes. The terms and conditions of the rights offering, the
description of the Notes and important additional information are
more fully set forth in the registration statement, as the same
may be amended or supplemented from time to time.
announcing the loan from Newcastle and the proposed rights
offering, a copy of which is attached as Exhibit 99.1 hereto.
| 4.1 |
Promissory Note dated December 22, 2016, payable by Rave
Restaurant Group, Inc. to Newcastle Partners, LP. |
2016.
About RAVE Restaurant Group, Inc. (NASDAQ:RAVE)
Rave Restaurant Group, Inc. operates and franchises pizza buffet, delivery/carry-out and express restaurants domestically and internationally under the trademark, Pizza Inn, and operates and franchises domestic fast casual restaurants under the trademarks Pie Five Pizza Company (Pie Five). The Company has two operating segments, which include Company-owned Restaurants, and Franchising and Food and Supply Distribution. The Franchising and Food and Supply Distribution segment establishes franchisees and franchise territorial rights, and sells and distributes proprietary and non-proprietary food and other items to franchisees. The Company-owned Restaurant segment includes sales and operating results for all Company-owned restaurants. It provides or facilitates the procurement and distribution of food, equipment and supplies to domestic and international system of restaurants through Norco Restaurant Services Company (Norco) division and through agreements with third-party distributors. RAVE Restaurant Group, Inc. (NASDAQ:RAVE) Recent Trading Information
RAVE Restaurant Group, Inc. (NASDAQ:RAVE) closed its last trading session up +0.28 at 2.21 with 191,866 shares trading hands.