Document/Exhibit Description Pages Size
1: 10-K/A Amendment to Annual Report 24 134K
2: EX-31.01 Certification per Sarbanes-Oxley Act (Section 302) 2± 9K
3: EX-31.02 Certification per Sarbanes-Oxley Act (Section 302) 2± 9K
4: EX-32.01 Certification per Sarbanes-Oxley Act (Section 906) 1 6K
5: EX-32.02 Certification per Sarbanes-Oxley Act (Section 906) 1 6K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Fiscal Year Ended April 1, 2007
or,
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File No. 0-26396
BENIHANA INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 65-0538630
--------------------------------------------- ---------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8685 NORTHWEST 53RD TERRACE, MIAMI, FLORIDA 33166
---------------------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 593-0770
-------------------
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
TITLE OF EACH CLASS NAME OF EXCHANGE ON WHICH REGISTERED
------------------- ------------------------------------
Common Stock, par value $.10 per share NASDAQ
Class A Common Stock,
par value $.10 per share NASDAQ
Preferred Share Purchase Right Not Applicable
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act.
Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act.
Yes [ ] No [X]
Indicate by check mark whether the 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 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. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):
Large accelerated filer [ ] Accelerated filer [X] Non-accelerated filer [ ]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).
Yes [ ] No [X]
As of May 31, 2007, 2,103,953 shares of Common Stock and 7,922,615 shares of
Class A Common Stock were outstanding. As of October 8, 2006, the last day of
the Company's second fiscal quarter, the aggregate market value of common equity
held by non-affiliates was $247,544,000.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's Annual Report to Stockholders for the year ended
April 1, 2007 are incorporated by reference in Parts I and II.
EXPLANATORY NOTE
Benihana Inc. (the "Company") hereby amends its Annual Report on Form 10-K for
the fiscal year ended April 1, 2007, which was filed on June 15, 2007, to
include Items 10, 11, 12, 13, 14 and 15.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
Below is a list of the names and ages of the directors and executive officers of
the Company as of July 1, 2007, indicating their position with the Company and
their principal occupation during the past five years and prior thereto where
applicable.
J. RONALD CASTELL
Director since 2005
Class I Director
Age 69
In 2004, Mr. Castell formed ReelRon LLC, a marketing consulting firm serving
clients such as Huizenga Holdings, Inc., Centryx Corp., Southern Audio Video and
Breakaway Films. From 1995 through 2004, Mr. Castell served as Senior Vice
President of Marketing and Communications of Huizenga Holdings, Inc. From 1989
through 1995, Mr. Castell served as Senior Vice President Programming and
Communications of Blockbuster Entertainment Corp.
JOSEPH J. WEST, PH.D.
Director since 2005
Class I Director
Age 63
Since 1999, Mr. West has been serving as Dean, School of Hospitality and Tourism
Management, Florida International University. Between 1991 and 1999, he served
as Department Chairman of Hospitality Administration, College of Business,
Florida State University, and from 1993 through 1996, he served as Director,
Hospitality Education Program, Department of Business and Professional
Regulation, State of Florida and has held teaching positions at Florida State
University and the University of South Carolina. Additionally, Mr. West
possesses restaurant operating experience as an executive and operator having
served as Vice President of Operations, Spring Garden Grill and Bar, and General
Manager at the following restaurant units: Franklin's Off Friendly, Colony
House/Wine Cellar Restaurants, and Colony Caterers. Mr. West is also a retired
U.S. Naval Officer.
TAKA YOSHIMOTO
Director since 1990
Class I Director, Executive Vice President - Operations
Age 61
Mr. Yoshimoto has served as Executive Vice President of the Company and its
predecessor since September 1989 and as the Director of Operations from May,
1986 until September 1989. Mr. Yoshimoto joined the Company in July 1979 and has
held various positions in operations. During that time, Mr. Yoshimoto has made
significant contributions to the Company's restaurant operations. Mr. Yoshimoto
holds a Masters Degree of Business Administration and a Masters Degree of
Economics and Finance from Louisiana State University, as well as a Bachelor of
Arts of Liberal Arts from International Christian University, Tokyo. He was born
and raised in Japan.
1
JOHN E. ABDO
Director since 1990
Class II Director
Age 64
Mr. Abdo has been principally employed since June 1984 as the Vice Chairman of
the Board of Directors and Chairman of the Executive Committee of each of
BankAtlantic Bancorp, Inc., and BankAtlantic, FSB. He has served as Vice
Chairman of Levitt Corporation, since August, 1984 and as the Vice Chairman of
the Board of Directors of Bluegreen Corporation, since March, 2002.
Additionally, he has served as the Vice Chairman of the Board of BFC Financial
Corporation since June, 1987. Mr. Abdo is the President and Chief Executive
Officer of Abdo Companies, Inc., a real estate development, construction and
real estate brokerage firm, for more than five years. He also serves on the
Board of Directors for SmartVideo Technologies. Mr. Abdo has also served as the
President of the Broward Performing Arts Foundation, a $60 million theater for
the Performing Arts that serves all of South Florida, since June, 1990.
NORMAN BECKER
Director since 1997
Class II Director
Age 69
Mr. Becker has been self-employed in the practice of public accounting since
April 1985. Prior thereto, Mr. Becker was a partner with Touche Ross & Co., the
predecessor of Deloitte & Touche LLP for a period in excess of 10 years. Mr.
Becker is also a director of Bluegreen Corporation and an officer of Proguard
Acquisition Corp.
ROBERT B. STURGES
Director since 2003
Class II Director
Age 60
During October 2006, Mr. Sturges was appointed Chief Executive Officer of Nevada
Gold & Casinos Inc., a company engaged in the development, ownership, and
operation of commercial gaming facilities, and lodging and entertainment
facilities in the United States. Mr. Sturges served as Nevada Gold & Casinos'
General Counsel between June 2006 and October 2006. Since 2001, Mr. Sturges has
been a partner at Continental Hospitality Holdings, a hospitality company, which
provides development, technical and operational services to the hotel and resort
industry. Mr. Sturges is a partner in the Miami Heat Basketball Organization.
From 1994 to 2001, Mr. Sturges was President of the Gaming Division and a
Director of Carnival Resort and Casino Inc. which developed, owned and managed
resorts, hotels and casinos.
JOEL A. SCHWARTZ
Director since 1982
Class III Director, Chief Executive Officer
Age 66
Mr. Schwartz has been a director of the Company and its predecessor since 1982
and has served as Chief Executive Officer of the Company since May 1998.
Additionally, Mr. Schwartz served as President of the Company from 1982 until
April 2007.
KEVIN Y. AOKI
Director since 1998
Class III Director
Age 39
Mr. Aoki has served as a director of the Company since 1998. Mr. Aoki is the
President of Aoki Group LLC. From 1998 through 2006, Mr. Aoki served as Vice
President-Marketing of the Company. For two years prior thereto, he served as
General Manager of Benihana of Tokyo, the originator of the Benihana concept and
a principal shareholder of the Company (see "Security Ownership of Certain
Beneficial Owners and Management"). From 1993 through 1996, Mr. Aoki served as
Unit Manager for certain of the Company's restaurants and as Manager of Sales
for the Company's New York region. Mr. Aoki is the son of Rocky H. Aoki, the
founder of Benihana.
2
LEWIS JAFFE
Director since 2004
Class III Director
Age 50
Mr. Jaffe is President, Chief Executive Officer and a director of Oxford Media,
Inc. Mr. Jaffe served as President and Chief Operating Officer of Verso
Technologies from November 2004 through August 2005. From August 2002 to
November 2004, Mr. Jaffe was a self-employed public speaker and consultant. From
April 2002 until August 2002, Mr. Jaffe served as the interim President of
Glowpoint, Inc., a publicly-traded video products and services company. From
July 2000 to July 2003, Mr. Jaffe served as an independent consultant to
Glowpoint, Inc. From June 2000 to March 2002, Mr. Jaffe served as President and
Chief Operating Officer of PictureTel Corporation, a publicly-traded
videoconferencing company. From September 1998 to June 2000, Mr. Jaffe served as
a managing director in the Boston office of Arthur Andersen LLP in its global
finance practice. From January 1997 to March 1998, Mr. Jaffe served as President
of C Systems, LLC, a designer and manufacturer of mobile military shelters,
housing, communication, and radar and missile launch systems. Mr. Jaffe served
as a member of the board of directors for Glowpoint, Inc. from September 2001 to
July 2003, the board of directors of Media 100 Inc. from June 2003 through
November 2004 and the Turnaround Management Association of New England from
September 1999 through November 2004. He currently is on the Board of ACT
Teleconferencing, Inc., a public company, as well as two private companies:
Travizon Inc. and Pixion, Inc.
JUAN C. GARCIA
President and Chief Operating Officer
Age 43
Mr. Garcia was appointed President and Chief Operating Officer during April
2007. Prior thereto, Mr. Garcia served as Senior Vice President - Chief
Operating Administrative Officer from June 2005 until April 2007. Prior thereto,
Mr. Garcia had served as Vice President-Controller since January 1999. He served
as Controller of the Company and its predecessor since July 1994. Prior to July
1994, Mr. Garcia served in various accounting and finance roles with the
Company. Mr. Garcia has served as the Assistant Secretary of the Company since
July 1996. Mr. Garcia is also a certified public accountant licensed in the
State of Florida.
JOSE I. ORTEGA
Vice President - Finance, Chief Financial Officer and Treasurer
Age 35
Mr. Ortega was appointed Vice President - Finance, Chief Financial Officer and
Treasurer during September 2006. Prior thereto, Mr. Ortega had served as
Controller of the Company since July 2005. Prior to joining the Company, Mr.
Ortega was employed at Burger King Corporation, as Director, Consolidation and
Reporting from November 2002 to July 2005, and prior thereto as Manager,
Consolidation and Reporting, from September 2001 to November 2002. From June
1996 through September 2001, Mr. Ortega was the Controller of Viragen, Inc., a
biotechnology company. Mr. Ortega is also a certified public accountant licensed
in the state of Florida.
3
AUDIT COMMITTEE
For the fiscal year ended April 1, 2007, the Audit Committee consisted of Norman
Becker (the Chairman), Lewis Jaffe and Robert B. Sturges, all of whom have been
determined by the Board of Directors to be independent (as independence is
defined in Rule 4200(a)(15) under the current National Association of Securities
Dealers, Inc. listing standards). The Board of Directors has determined that
Norman Becker qualifies as an "audit committee financial expert" as defined by
Item 407(d)(5)(ii) of Regulation S-K promulgated by the Securities and Exchange
Commission.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Rules promulgated by the Securities and Exchange Commission govern the reporting
of securities transactions by directors, officers and holders of 5% or more of
the Company's Common Stock or Class A Common Stock. Based solely upon its review
of copies of reports filed with the SEC and received by the Company, the Company
believes that its directors and officers have filed all required reports on a
timely basis except the following: Mr. Abdo failed to report on two Form 4s on a
timely basis an automatic option grant and an option exercise; Mr. Aoki failed
to report on two Form 4s on a timely basis a purchase of shares and an automatic
option grant; Mr. Becker failed to report on three Forms 4s on a timely basis an
automatic option grant and two option exercises; Mr. Castell failed to report on
a Form 4 on a timely basis an automatic option grant; Darwin D. Dornbush failed
to report on a Form 4 on a timely basis an option exercise and sale of shares;
Richard Howland failed to report on a Form 3 on a timely basis his initial
statement of beneficial ownership of the Company's stock; Mr. Jaffe failed to
report on a Form 4 on a timely basis an automatic option grant; Mr. Schwartz
failed to report on a Form 4 on a timely basis an option exercise and sale of
shares; Mr. Sturges failed to report on Form 4 on a timely basis an automatic
option grant; and Mr. West failed to report on a Form 4 on a timely basis an
automatic option grant.
CODE OF ETHICS
The Company has adopted a written code of business conduct and ethics that
applies to its directors and officers, including the Chief Executive Officer and
Chief Financial Officer. The code of business conduct and ethics is available on
the Company's website, which is located at WWW.BENIHANA.COM. The Company intends
to make all required disclosures concerning any amendments to, or waivers from,
the Company's code of business conduct and ethics on the its website.
4
ITEM 11. EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
The Company's Compensation and Stock Option Committee of the Board of Directors
(the Compensation Committee) discharges the responsibilities of the Board of
Directors with respect to compensation of the Company's executives - which, with
respect to the fiscal year ended April 1, 2007, includes the Chief Executive
Officer and President, Joel A. Schwartz; the Senior Vice President and Chief
Operating Administrative Officer, Juan C. Garcia; the current Chief Financial
Officer and Vice President - Finance, Jose I. Ortega, who was appointed to such
offices effective September 1, 2006; the prior Chief Financial Officer and
Senior Vice President - Finance, Michael Burris, who held such offices at the
beginning of the fiscal year through August 31, 2006; and the Executive Vice
President - Operations, Taka Yoshimoto (together, with Messrs. Schwartz, Garcia,
Ortega and Burris, the Named Executive Officers') - and administration of the
Company's equity-based employee compensation plans and is responsible for
evaluating the Named Executive Officers' performance in light of Board of
Director objectives and establishing compensation levels based on such
evaluation. Additionally, the Compensation Committee makes recommendations to
the Board of Directors regarding incentive compensation plans and equity-based
plans with respect to the Named Executive Officers'.
OBJECTIVES OF COMPENSATION PROGRAM
The objective of the Company's compensation program is to attract, retain and
motivate exceptional personnel who will extend the Company's legacy of more than
forty years and continue the Company's expansion into new and innovative areas
of dining. To accomplish that objective, the Company seeks to directly link
compensation to Company performance results, individual achievement of tailored
goals and individual attainment of increased responsibility. In maintaining and
improving the Company's program, the Company monitors developments and
innovations in the area of compensation. Because the Company operates in the
restaurant industry, which is subject to particularly intense competition,
highly sensitive to consumer-spending fluctuations and susceptible to rapid
regulatory change, the Company seeks to tailor the Company's compensation of
Named Executive Officers to modulate otherwise wide year-to-year changes in
compensation.
WHAT THE COMPANY'S COMPENSATION PROGRAM IS DESIGNED TO REWARD
The Company's compensation program is designed to reward the Named Executive
Officers for advancing critical elements of the Company's growth strategy:
selectively pursuing restaurant growth, developing and maintaining strong
restaurant unit economics (by sustaining sales growth and implementing cost
controls at the individual unit level), continuing to build brand awareness and
customer loyalty and providing strong management support to restaurant units.
Named Executive Officer contributions to these goals are measured at the
individual and Company levels.
In order to maintain the Company's talented employee base, including the Named
Executive Officers, and to continue to attract experienced personnel, the
Company surveys compensation arrangements and levels of a peer group of casual
dining restaurant companies which most closely reflect the Company's market
sector, based on cuisine and price point, and size, based on number of
restaurant units, annual sales or market capitalization. The Compensation
Committee may consider such information when establishing compensation amounts
and elements. Except in connection with specific matters, the Compensation
Committee does not presently, and, with respect to the fiscal year ended April
1, 2007, did not, engage a compensation consultant to assist in evaluation of
the Company's compensation program.
ELEMENTS OF THE COMPANY'S COMPENSATION PROGRAM, WHY THE COMPANY CHOSE
EACH ELEMENT AND HOW IT RELATES TO THE COMPANY'S OBJECTIVES
The two elements of the Company's compensation program are base salary and cash
incentive awards. Annual base salaries are the primary element of compensation
for all employees, including Named Executive Officers. The factors considered in
setting and increasing base salaries for Named Executive Officers are their
experience, responsibilities, ability and previous performance. In addition, the
Compensation Committee takes into account the Company's performance. Base
salaries provide each Named Executive Officer with predetermined compensation,
enabling them to maintain their livelihood and focus on pursuing achievement of
Company objectives throughout the year.
The Company's incentive compensation program is designed to reward key
employees, including Named Executive Officers, with annual cash awards for
achieving Company level and individually-designed performance objectives which
are, at minimum levels, realistically attainable and, at maximum levels,
sufficiently aggressive and difficult to
5
obtain so as to encourage optimal Company-wide growth and innovation. Each Named
Executive Officer's award opportunity is a percentage of such executive
officer's base salary, totaling 30% of base salary for the fiscal year ended
April 1, 2007. Seventy-five percent of the award is based on exceeding certain
budgeted Company-wide results while 25% is based on achieving other personal
performance and management goals specific to the individual's role in the
Company. The Compensation Committee believes Company-based objectives cultivate
teamwork and cooperation and aligns the interests of the Named Executive Officer
with those of the Company's stockholders. The Compensation Committee uses return
on equity as the determinative measure of Company performance and establishes a
range of targeted return on equity levels based upon the difficulty in achieving
such thresholds in light of the Company's historical performance and current
projections. Personal performance and management goals encourage maximization of
fulfillment of individual potential. The program's cash incentive awards are
intended to align Named Executive Officers' motivation with achieving objectives
in the Company's interest while avoiding the unfavorable accounting treatment
accorded to, and share dilution which results, in particular, from stock option
plans. The Company does, however, periodically evaluate its use of equity
incentives as part of the Company's compensation program.
HOW THE COMPANY CHOSE AMOUNTS AND FORMULAS FOR EACH ELEMENT
Base salaries of each Named Executive Officer are defined in their respective
employment agreements and subject to future increases as determined from time to
time by the Compensation Committee. Factors considered in determining base
salaries include Company accomplishments in the prior year and the Company's
objectives for the upcoming year; comparison to peer companies; the availability
of replacement personnel on the labor market; salary changes in prior years;
executive experience, responsibilities, ability and performance; and increasing
cost of living. During August 2006, the Compensation Committee, based upon
consideration of factors previously discussed, approved increases in the base
salaries, for the fiscal year ended April 1, 2007, of Messrs. Garcia and
Yoshimoto by $65,000 and $17,800, respectively. In connection with Mr. Ortega's
promotion to Vice President - Finance and Chief Financial Officer and based upon
consideration of the factors previously discussed, Mr. Ortega's base salary was
increased to $185,000.
The maximum overall bonus opportunities for each Named Executive Officer was set
at 30% of his annual base salary. Twenty-five percent of the bonus is based on
the Named Executive Officer's fulfillment of his individual goals and
objectives. Each Named Executive Officer receives some or all of the remaining
seventy-five percent (the Company performance component) if the Company achieves
targeted return on equity thresholds identified in the plan. The Company
believes the thresholds are, at the minimum level, realistically attainable and
avoid making compensation too contingent upon Company performance, while, at the
maximum level, sufficiently aggressive to encourage optimal growth and
innovation. To formulate personal performance goals and management objectives,
the Chief Executive Officer met with each Named Executive Officer to exchange
ideas and agree upon criteria; goals and objectives relating to the Chief
Executive Officer were set during a meeting between Mr. Schwartz and the
Chairman of the Compensation Committee. Such goals and objectives relating to
the Chief Executive Officer and each of the other Named Executive Officers were
related to updating and executing the Company's strategic plan, as well as other
goals directly tied to their areas of responsibility. All goals are approved by
the Compensation Committee.
Prior to a meeting of the Compensation Committee on June 7, 2007, the Chief
Executive Officer reported to the Compensation Committee that, with respect to
the fiscal year ended April 1, 2007, the Company had achieved a return on equity
warranting, in the case of each Named Executive Officer, payment of the minimum
award for such officer with respect to that portion of the incentive
compensation award connected to Company performance. In addition, the Chief
Executive Officer determined that, because each Named Executive Officer fully
achieved each of his personal objectives and he recommended approval by the
Compensation Committee that the maximum award for Named Executive Officer be
given with respect to that portion of such Named Executive Officer's incentive
compensation award based on achievement of his personal objectives. The
Compensation Committee discussed and approved such amounts.
HOW EACH COMPENSATION ELEMENT AND THE COMPANY'S DECISIONS REGARDING EACH
ELEMENT FIT INTO THE COMPANY'S OVERALL COMPENSATION OBJECTIVES AND
AFFECT DECISIONS REGARDING OTHER ELEMENTS
As discussed above, through the Company's compensation program we seek to
attract, retain and motivate exceptional personnel to accomplish the Company's
objectives within the restaurant industry. Because of the various external
forces which may quickly impact the Company's business, the Company seeks to
modulate compensation of Named Executive Officer compensation such that salaries
do not widely fluctuate year-to-year by emphasizing annual base salary over
incentive compensation payments. Accordingly, payments under the Company's
incentive compensation plan may not increase in direct proportion to increases
in annual base salary.
6
POST RETIREMENT AND OTHER BENEFITS
The Company offers to its Named Executive Officers, along with other key
employees, an opportunity to participate in the Company's Deferred Compensation
Plan. These employees may elect to defer up to 20% of their salary and 100% of
their bonus until retirement or age 55, whichever is later, or, if earlier,
until termination of employment due to disability or death. These employees may
select from various investment options for their available account balances. The
Company does not match employee contributions to the Deferred Compensation Plan.
A more detailed description of the plan may be found under the heading
"Nonqualified Deferred Compensation" in this form 10-K. In addition, the
Company's employment agreements with certain Named Executive Officers provide
for payments in the event of certain terminations of employment, including those
resulting from a change in control of the Company. The Company has also agreed
with each of the Named Executive Officers to make certain payments in event of
such person's death or disability. A more detailed description of the payments
required in the event of termination or a change in control may be found under
the heading "Post Termination Benefits and Change in Control" in this Form 10-K.
COMPENSATION AND STOCK OPTION COMMITTEE REPORT
The Company's Compensation Committee has reviewed and discussed with management
the Compensation Discussion and Analysis to be included in the Company's Annual
Report on Form 10-K (the "Form 10-K") with respect to the Company's fiscal year
ended April 1, 2007, filed pursuant to Section 13 of the Securities Exchange Act
of 1934. Based on the reviews and discussions referred to above, the Company's
Compensation Committee recommended to the Board of Directors that the
Compensation Discussion and Analysis referred to above be included in the Form
10-K.
COMPENSATION AND STOCK OPTION COMMITTEE
John E. Abdo (Chairman)
Norman Becker
J. Ronald Castel
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth compensation for the Company's Chief Executive
Officer; the Company's current and former Chief Financial Officers and the
Company's other most highly compensated executive officers (the Company's Named
Executive Officers) during fiscal year ended April 1, 2007.
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[Enlarge/Download Table]
SUMMARY COMPENSATION TABLE
NON-EQUITY
INCENTIVE PLAN ALL OTHER
NAME AND FISCAL SALARY COMPENSATION COMPENSATION TOTAL
PRINCIPAL POSITION YEAR ($) ($) ($)(1) ($)
------------------ ------ --------- ------------- ------------ -------
Joel A. Schwartz, Chairman, Chief 2007 $355,377 $45,793 $7,148 $408,318
Executive Officer and President
Taka Yoshimoto, Director and 2007 201,019 14,819 4,188 220,026
Executive Vice President -
Operations
Juan C. Garcia, Senior Vice 2007 177,500 24,062 4,580 206,142
President and Chief Operating
Administrative Officer (2)
Jose I. Ortega, Vice President - 2007 158,950 20,945 4,481 184,376
Finance and Chief Financial
Officer (3)
Michael R. Burris, Senior Vice 2007 127,135 13,558 3,874 144,567
President - Finance and Chief
Financial Officer (4)
--------------------------------
(1) Other Compensation included Company-paid Group Term Life Insurance and
automobile allowance.
(2) Mr. Garcia's promotion to President and Chief Operating Officer occurred
after fiscal year end 2007. Accordingly, all information concerning
compensation for Mr. Garcia reflects compensation earned in his position
as Senior Vice President and Chief Operating Administrative Officer.
(3) Mr. Ortega was promoted to the position of Vice President - Finance and
Chief Financial Officer effective September 1, 2006. All information
concerning compensation for Mr. Ortega reflects compensation earned for
the entire fiscal year 2007, including compensation earned in his
position as Vice President - Finance and Chief Financial Officer.
(4) Mr. Burris resigned as the Company's Senior Vice President - Finance and
Chief Financial Officer effective August 31, 2006, and continued his
employment as the Company's Vice President - Investor Relations. All
information concerning compensation for Mr. Burris reflects compensation
earned for the entire fiscal year 2007.
8
GRANTS OF PLAN-BASED AWARDS TABLE
The following table sets forth certain additional information regarding the
range of possible grants of plan-based awards to the Company's Named Executive
Officers for the fiscal year ended April 1, 2007. Actual grants awarded with
respect to the fiscal year ended 2007 are disclosed as Non-Equity Plan
Compensation in the Summary Compensation Table" above. Under the Company's
Incentive Compensation Plan, each Named Executive Officer may receive a cash
award, which may be all or a portion of his maximum overall bonus opportunity,
which for fiscal 2007 was 30% of such Named Executive Officer's base salary.
Eligibility for 75% of the award is based on exceeding certain targeted
Company-wide results, while eligibility for the remaining 25% is based on
achieving other personal performance and management goals specific to the
individual's role in the Company. Because the personnel component is based on
subjective criteria of individual achievement objectives, the Company has
assumed that, at the threshold level, a Named Executive Officer has not achieved
any objectives and, at a maximum level, a Named Executive Officer has achieved
all of his objectives. With respect to the Company component, the threshold and
maximum levels are based on the minimum and maximum awards 25% and 100%,
respectively, under the plan. The plan provides for a range of payments between
the threshold amount and the maximum amount, which is determined by the
achievement of various levels of Company performance and a Named Executive
Officer's achievement of personal objectives. Accordingly, there is no target
under the Company's plan and the Company has omitted the column providing such
information.
ESTIMATED FUTURE PAY-OUTS UNDER
NON-EQUITY INCENTIVE PLAN AWARDS
--------------------------------
THRESHOLD MAXIMUM
NAME ($) ($)
---- --------- --------
Joel A. Schwartz $ 19,625 $104,670
Jose I.Ortega 8,976 47,875
Michael R. Burris 6,972 30,990
Juan C. Garcia 10,312 55,000
Taka Yoshimoto 11,114 59,276
NARRATIVE ADDENDUM TO THE SUMMARY COMPENSATION TABLE AND GRANTS OF PLAN-BASED
AWARDS TABLE The Company entered into an employment agreement with Mr. Schwartz
to continue to serve as President and Chief Executive Officer on April 1, 2001
and, pursuant to an amendment dated May 27, 2004, such agreement was extended
until March 31, 2009. The employment agreement provides for an initial annual
base salary of $300,000, subject to annual adjustment based on cost of living
increases.
The Company entered into an employment agreement with Mr. Ortega on August 28,
2006, in connection with Mr. Ortega's promotion to Vice President - Finance and
Chief Financial Officer, providing for an initial annual base salary of
$185,000.
The Company entered into an employment agreement with Mr. Burris on September 1,
2003, to continue to serve as Senior Vice President - Finance and Chief
Financial Officer through August 31, 2006, providing for an initial base salary
of $157,500.
The Company entered into an employment agreement with Mr. Yoshimoto on April 1,
2006, to continue to serve as Executive Vice President - Operations, providing
for an initial base salary of $187,209 and subject to annual adjustment based on
cost of living increases.
The Company entered into an employment agreement with Mr. Garcia on September 1,
2003. Such agreement was amended on October 17, 2005, in connection with Mr.
Garcia's promotion to Senior Vice President - Chief Operating Administrative
Officer, and on August 28, 2006, in connection with an increase in Mr. Garcia's
initial annual base salary to $205,000, subject to annual adjustment based on
cost of living increases.
The terms of the employment agreement with each of the Company's Named Executive
Officers provide for bonuses determined by the Company's Board of Directors
under the Company's Incentive Compensation Plan (as discussed under the heading
"Compensation Discussion and Analysis" and in the "Grants of Plan-Based Awards"
table in this form 10-K). Additionally, pursuant to the terms of the employment
agreement with each of the Company's Named Executive Officers, each such officer
will be eligible to receive equity awards under any of the Company's employee
9
benefit plans, will be eligible to participate in the health, insurance and
other benefit plans generally available to the Company's executive officers and
will be entitled to receive an automobile expense allowance between $200 and
$300 per month. No stock options were granted during fiscal year 2007 to the
Company's Named Executive Officers under the Company's current stock option
plan. In addition, Messrs. Schwartz and Yoshimoto are eligible for severance
payments upon certain events of termination of their employment, as discussed
under the heading "Post-Termination Benefits and Change in Control" section in
this 10-K.
10
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE
The following table sets forth information regarding each unexercised option
held by each of the Company's Named Executive Officers as of April 1, 2007.
OPTION AWARDS
-------------
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED
OPTIONS OPTION OPTION
(#) EXERCISE PRICE EXPIRATION
NAME EXERCISABLE(1) ($)(1) DATE
---- ---------------------- -------------- ----------
Joel A. Schwartz 74,750 $10.6522 10/30/07
40,250 $13.4783 9/1/09
57,500 $11.7391 5/12/10
51,750 $ 7.4435 4/24/11
57,500 $16.7826 6/7/12
Taka Yoshimoto 23,000 $13.4783 9/1/09
46,000 $11.7391 5/12/10
46,000 $16.7826 6/7/12
Juan C. Garcia 34,500 $11.7391 5/12/10
28,750 $ 7.4435 4/24/11
34,500 $16.7826 6/7/12
Jose I. Ortega - - -
Michael R. Burris 25,530 $11.7391 5/12/10
40,250 $16.7826 6/7/12
------------------
(1) Table does not reflect the Company's recent stock split, payable on June
15, 2007, of one-half of one share of Common Stock for each outstanding
share of Common Stock and each outstanding share of Class A Common Stock to
holders of record on June 1, 2007. All options were fully vested on April
1, 2007.
11
OPTION EXERCISES AND STOCK VESTED TABLES
The following table shows the number of shares acquired upon exercise of stock
options by each of the Company's Named Executive Officers during the fiscal year
ended April 1, 2007.
OPTION AWARDS
-------------
NUMBER OF SHARES VALUE REALIZED
NAME ACQUIRED ON EXERCISE (#) ON EXERCISE ($) (1)
---- ------------------------ -------------------
Joel A. Schwartz 34,500 $653,806
Taka Yoshimoto - -
Juan C. Garcia - -
Jose I. Ortega - -
Michael R. Burris 11,500 169,470
------------------
(1) The "value realized on exercise" is the difference between the market price
of the underlying security at exercise and the exercise price of the
option.
12
NONQUALIFIED DEFERRED COMPENSATION
The following table shows the executive contributions, earnings and account
balances for the Named Executive Officers under the Company's Deferred
Compensation Plan. The Deferred Compensation Plan allows key employees,
including the Named Executive Officers, to defer up to 20% of their annual base
salary and up to 100% of their annual bonuses until retirement or age 55,
whichever is later, or if earlier, until a termination of employment due to
disability or death. Deferred amounts may be invested among several investment
programs at the participant's option. Participants' obligation to pay federal or
state income tax on contributions to the plan are deferred until withdrawal of
such amounts. The Company does not match any of the amounts deferred by
participants in the Deferred Compensation Plan.
Employees who participate in the Deferred Compensation Plan may invest deferred
monies in a range of investment vehicles, including Money Markets, Bonds and
Mutual Funds. Over the last three years, these investments have yielded less
than 5% per annum.
EXECUTIVE AGGREGATE AGGREGATE AGGREGATE
CONTRIBUTIONS EARNINGS WITHDRAWALS/ BALANCE AT LAST
IN LAST FY IN LAST FY DISTRIBUTIONS FISCAL YEAR END
NAME ($)(1) ($) ($) ($)
---- ------------- ----------- ------------- ---------------
Joel A. Schwartz $ 26,500 $ 12,748 - $ 301,754
Taka Yoshimoto - - - -
Juan C. Garcia - - - -
Jose I. Ortega - - - -
Michael R. Burris 19,742 6,036 - 93,137
------------------
(1) The amounts set forth in this column have also been reported as "Salary" in
the Summary Compensation Table contained in this Form 10-K/A.
13
POST-TERMINATION BENEFITS AND CHANGE IN CONTROLS
COMPENSATION UPON TERMINATION OF EMPLOYMENT The Company's employment agreement
with Mr. Schwartz provides that in the event of his termination without cause,
disability, as a result of a change in control of the Company or as a result of
a failure to renew or extend Mr. Schwartz's employment agreement, he shall
receive a payment equal to five times his annual base salary in effect at the
time of such termination. Such payment shall be paid in sixty equal monthly
installments unless termination was due to termination without cause or as a
result of a change in control, in which case such payments shall be in two equal
installments upon termination and the first anniversary thereof. In addition, if
Mr. Schwartz is terminated without cause or, after a change in control, Mr.
Schwartz elects to resign, he shall receive an additional payment equal to his
annual base salary in effect at the time of such termination multiplied by the
number of years remaining under his employment agreement. In addition, in the
event of a change in control of the Company, Mr. Schwartz has the right at any
time thereafter to cause the Company to repurchase any options granted him in
connection with his services as an employee, officer, director at a purchase
price equal to the difference between the closing price of the appropriate stock
on the stock exchange on which the Company's stock is listed, on the date
immediately prior to the exercise of such rights, and the exercise price of such
option. For one year following termination of Mr. Schwartz's employment for any
reason (other than termination by the Company without cause), Mr. Schwartz is
prohibited from engaging in any business activity within the United States (or
any other area in which the Company conducts substantial business operations)
which competes with the Company's business or solicit, directly or indirectly,
any of the Company's employees, customers or accounts. In the event of the death
of Mr. Schwartz, the employment agreement provides that the Company shall pay
his beneficiary or other designated person $350,000 less the amount of any
insurance on Mr. Schwartz's life which the Company has purchased.
The Company's employment agreement with Mr. Yoshimoto provides that if he is
terminated without cause or, after a change in control of the Company, Mr.
Yoshimoto elects to resign, he shall receive an additional payment equal to his
annual base salary multiplied by the number of years remaining under his
employment agreement. In the event Mr. Yoshimoto's employment is terminated,
unless such termination is a result of the Company's breach of the employment
agreement, Mr. Yoshimoto is prohibited from engaging, directly or indirectly in
any business activity within the United States which competes with the Company's
business, provided that he may own any class of securities of any corporation
which is regularly traded on any stock exchange or over-the-counter market.
In the event of the death or disability of any of Messrs. Ortega, Garcia and
Yoshimoto, the Company's employment agreements with each Named Executive Officer
provides that the Company shall pay such person, his designee or his beneficiary
his monthly base salary in effect at the time of such event for a period of
three months after such event. Mr. Burris's employment agreement was terminated
as of August 31, 2006 and, accordingly, he is not entitled to any
post-termination benefits.
Set forth in the table below are reasonable estimates of the potential amounts
payable to a Named Executive Officer assuming his employment was terminated
without cause, in connection with a change in control of the Company or as a
result of disability or death, in each case, based on a termination date of
April 1, 2007.
TERMINATION CHANGE IN
NAME WITHOUT CAUSE CONTROL DISABILITY DEATH
---- ------------- --------- ---------- -----
Joel A. Schwartz (1) $2,442,300 $2,442,300 $1,744,500 350,000
Jose I. Ortega - - 46,250 46,250
Juan C. Garcia - - 51,250 51,250
Taka Yoshimoto 410,018 410,018 51,250 51,250
------------------
(1) If, on or after March 31, 2009, Mr. Schwartz's employment agreement is not
renewed or extended, Mr. Schwartz would receive a payment of $1,744,500.
14
DIRECTOR COMPENSATION
The table below summarizes the compensation earned by non-employee directors for
the fiscal year ended April 1, 2007.
FEES EARNED OR OPTION ALL OTHER
NAME PAID IN CASH($) AWARDS($)(1) COMPENSATION($) TOTAL($)
-------------- --------------- ------------- --------------- --------
Kevin Y. Aoki (2) $ 19,500 $ 18,643 $ 63,756 (3) $ 101,899
John E. Abdo 33,000 65,280 - 98,280
Norman Becker 45,500 65,280 - 110,780
Lewis Jaffe 30,250 65,280 - 95,530
J. Ronald Castell 29,500 57,232 - 86,732
Joseph J. West 30,750 57,232 - 87,982
Robert B. Sturges 40,500 65,280 - 105,780
------------------
(1) Represents the amount of compensation cost recognized by the Company in
the fiscal year ended April 1, 2007 related to stock option awards granted
in prior years, as described in Statement of Financial Accounting
Standards No. 123R (SFAS 123R). For a discussion of valuation assumptions,
see Note 1 to the Company's 2007 Consolidated Financial Statements
included in the Company's Annual Report on Form 10-K for the year ended
April 1, 2007.
(2) Mr. Aoki resigned as the Company's Vice President - Marketing on April 21,
2006, becoming a non-employee director on that date. Accordingly,
compensation paid to Mr. Aoki was prorated for fiscal year 2007.
(3) This amount represents salary paid to Mr. Aoki in connection with his
employment as Vice President - Marketing for the period commencing on
March 27, 2006 through August 31, 2006, the end of the term under his then
existing employment agreement, as further discussed under the heading
"Certain Relationships and Related Transactions" in this Form 10-K.
DIRECTOR FEES. During the fiscal year ended April 1, 2007, the Company provided
the following standard compensation to the Company's non-employee directors:
$15,000 per year for service as a director plus a fee of $1,500 for each board
meeting attended in person (or $750 for each meeting attended telephonically).
Additionally, the Company provided compensation to non-employee directors of
$1,500 for each committee meeting attended in person (or $750 for each meeting
attended telephonically); compensation for committee meetings, however, was
reduced to $1,000 for meetings held on the same day as board meetings. The
Company provided compensation of $7,500 per year to the chairman of the Audit
Committee and $2,500 per year to the chairman of each other committees. The
Company also provided compensation of $5,000 per year to the Company's
Independent Lead Director. All directors are reimbursed for expenses incurred on
the Company's behalf.
AUTOMATIC OPTION GRANTS. Each non-employee director participates in the existing
2003 Directors' Stock Option Plan. Under this plan, options to purchase 10,000
shares of Class A Common Stock (as adjusted in the event any changes in the
Company's outstanding stock; E.G., due to a stock dividend or merger) are
automatically granted annually to each non-employee director on the date of the
Company's Annual Meeting of Stockholders. Options granted under the plan are
exercisable ratably as to one-third of the shares on the date which is six
months after the date of grant, one-third of the shares on the first anniversary
of the grant of such option and as to the balance of such shares on the second
anniversary of grant of such option. All options granted under the plan have a
term of ten years from the date of grant and have an exercise price equal to the
fair market value of a share on the date of grant. All options remain
exercisable for a period of three months following the cessation of a
non-employee directors' membership on the Company's Board of Directors.
15
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
EQUITY COMPENSATION PLAN INFORMATION
The following table sets forth information, as of April 1, 2007 with respect to
shares of the Company's Common Stock and Class A Common Stock which may be
issued under its equity compensation plans.
[Enlarge/Download Table]
NUMBER OF SECURITIES
REMAINING AVAILABLE FOR
NUMBER OF SECURITIES TO BE FUTURE ISSUANCE UNDER
ISSUED UPON EXERCISE OFF WEIGHTED AVERAGE EXERCISE EQUITY COMPENSATION PLANS
OUTSTANDING OPTIONS, PRICE OF OUTSTANDING (EXCLUDING SECURITIES
PLAN CATEGORY WARRANTS AND RIGHTS (4) OPTIONS, WARRANTS AND RIGHTS REFLECTED IN COLUMN (A))
------------- ------------------- ---------------------------- ------------------------
(a) (b) (c)(1)
Equity compensation plans
approved by security
holders 1,034,865(2) $13.84(2) 1,054,954
Equity compensation plans
not approved by security
holders(3) 5,750 7.83 --
Total 1,040,615 13.81 1,054,954
------------------
(1) Represents securities authorized for issuance and not yet issued as of
April 1, 2007 under the Company's 2003 Directors' Stock Option Plan,
2000 Employees Class A Stock Option Plan, Amended and Restated
Directors' Stock Option Plan (1997) and 1997 Employees Class A Stock
Option Plan. The Amended and Restated Directors' Stock Option Plan and
1997 Employees Class A Stock Option Plan each expire on October 29,
2007.
(2) Based on outstanding options under the Company's equity compensation
plans described in footnote 1 of this table.
(3) Represents options granted to Norman Becker pursuant to a stock option
agreement dated as of February 9, 2001, which provides for the grant of
an option to purchase 5,000 shares of Class A Common Stock (as adjusted
in the event any changes in the Company's outstanding stock; E.G., due
to a stock dividend or merger) at an exercise price of $9.00 per share
and having a term of ten years from the date of such agreement.
One-third of such options were immediately exercisable and one-third
vested on each of the first and second anniversaries of the date of the
grant.
(4) Table does not reflect the Company's recent stock split, payable on June
15, 2007, of one-half of one share of Common Stock for each outstanding
share of Common Stock and each outstanding share of Class A Common Stock
to holders of record on June 1, 2007. All options were fully vested on
April 1, 2007.
SECURITY OWNERSHIP
The following table sets forth information relating to the beneficial ownership
of the Company's Common Stock and Class A Common Stock by all persons the
Company knows to beneficially own more than 5% of the Company's Common Stock or
Class A Common Stock outstanding on July 3, 2007 and by all of the Company's
executive officers and directors. As of July 3, 2007, there were 7,031,009
shares of Common Stock and 8,022,341 shares of Class A Common Stock outstanding.
Except as otherwise noted, the named person owns directly and exercises sole
voting power and investment discretion over the shares listed as beneficially
owned.
16
[Enlarge/Download Table]
COMMON STOCK
PERCENT
NAME (AND ADDRESS IF APPLICABLE) OF POSITION WITH AMOUNT AND NATURE OF OF CLASS
BENEFICIAL OWNERS, OFFICERS AND DIRECTORS THE COMPANY BENEFICIAL OWNERSHIP (1)(2)(3) (1)(3)
----------------------------------------- ----------- ------------------------------ ------
Benihana of Tokyo, Inc. (4) Stockholder 2,153,502 25.0%
232 East 63rd Street
New York, New York 10021
Kyle Aoki (4) Stockholder 2,153,502 25.0%
Grace Aoki (4) Stockholder 2,153,502 25.0%
BFC Financial Corporation (5) Stockholder 1,578,943 18.3%
1750 East Sunrise Boulevard
Ft. Lauderdale, Florida 33304
Andreeff Equity Advisors, LLC (6) Stockholder 458,551 5.3%
450 Laurel Street, Suite 2105
Baton Rouge, Louisiana 70801
Kevin Y. Aoki (4)(7) Director 2,165,060 25.1%
Joel A. Schwartz (7) (8) Chief Executive 246,715 2.8%
Officer/Director
Taka Yoshimoto (7) Executive Vice 126,200 1.5%
President - Restaurant
Operations/Director
Michael R. Burris (16) Senior Vice President - 17,000 *
Finance and Chief
Financial Officer
John E. Abdo (7) Director 77,833 *
Juan C. Garcia (7) President 48,875 *
Norman Becker (7) Director 37,995 *
Robert B. Sturges (7) Director 13,333 *
Lewis Jaffe (7) Director 13,333 *
J. Ronald Castell (7) Director 8,333 *
Joseph J. West (7) Director 8,333 *
All directors and officers as a group (7) 2,763,012 30.7%
17
[Enlarge/Download Table]
CLASS A COMMON STOCK
NAME (AND ADDRESS IF APPLICABLE) OF POSITION WITH AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNERS, OFFICERS AND DIRECTORS THE COMPANY BENEFICIAL OWNERSHIP (1)(2)(3) OF CLASS (1)
----------------------------------------- ----------- ------------------------------ ------------
Andreeff Equity Advisors, LLC (9) Stockholder 507,902 6.3%
450 Laurel Street, Suite 2105
Baton Rouge, Louisiana 70801
Gruber and McBaine Capital Management, LLC (10) Stockholder 493,825 6.2%
50 Osgood Place, Penthouse
San Francisco, CA 94133
Connors Investor Services, Inc. (11) Stockholder 450,875 5.6%
1210 Broadcasting Road
Wyomissing, PA 19610
Lord, Abbett & Co. LLC (12) Stockholder 407,394 5.1%
90 Hudson Street
Jersey City, NJ 07302
JP Morgan Chase & Co. (13) Stockholder 397,400 5.0%
270 Park Avenue
New York, NY 10017
Kevin Y. Aoki (14) Director 11,467 *
Joel A. Schwartz (14)(15) Chief Executive 338,275 4.1%
Officer/Director
Taka Yoshimoto (14) Executive Vice 115,900 1.4%
President- Restaurant
Operations/Director
Michael R. Burris (17) Senior Vice President - 97,987 1.2%
Finance and Chief
Financial Officer
John E. Abdo (14) Director 95,667 1.2%
Juan C. Garcia (14) President 100,750 1.2%
Norman Becker (14) Director 75,992 *
Robert B. Sturges (14) Director 26,667 *
Lewis Jaffe (14) Director 26,667 *
J. Ronald Castell (14) Director 16,667 *
Joseph J. West (14) Director 16,667 *
All directors and officers as a group (14) 922,704 10.5%
18
NOTES
(1) For purposes of the beneficial ownership and the percentage ownership of
each person, the shares of the Company's Common Stock which BFC
Financial Corporation would own upon conversion of the entirety of its
holdings of the Company's Convertible Preferred Stock are considered
outstanding.
(2) Shares of the Company's Common Stock are convertible at any time into
shares of the Company's Class A Common Stock at the option of the
holder. Therefore, each beneficial owner of the Company's Common Stock
may be deemed the beneficial owner of the same number of shares of the
Company's Class A Common Stock.
(3) Beneficial ownership on this table has been adjusted to reflect the
Company's recent stock dividend, payable on June 15, 2007, of one-half
of one share of Common Stock for each outstanding share of Common Stock
and each outstanding share of Class A Common Stock to holders of record
on June 1, 2007.
(4) All of the issued and outstanding capital stock of Benihana of Tokyo,
Inc. (the "Benihana of Tokyo Stock") is owned by a trust of which Kevin
Y. Aoki, Kyle Aoki and Grace Aoki are the named trustees. By reason of
such positions, such individuals may be deemed to share beneficial
ownership of the Benihana of Tokyo Stock and the shares of the Company's
stock owned by Benihana of Tokyo.
(5) Represents Common Stock which BFC Financial Corporation would own if its
Convertible Preferred Stock were converted (see "Certain Relationships
and Related Transactions").
(6) Based solely on Schedule 13G filed by such person on February 14, 2007.
Such person has shared voting power as to 458,551 shares of Common Stock
and shared dispositive power as to 458,551 shares of Common Stock.
(7) Beneficial ownership on this table includes the following Common Stock
which may be purchased by exercise of options which are presently
exercisable or which will become exercisable within 60 days: Mr.
Schwartz - 169,625 shares; Mr. Yoshimoto - 57,500 shares; Mr. Aoki -
3,333; Mr. Garcia - 48,875 shares; Mr. Abdo - 46,333; Mr. Becker -
37,708 shares; Mr. Sturges - 13,333 shares; Mr. Jaffe - 13,333 shares;
Mr. Castell - 8,333 shares; Mr. West - 8,333 shares; all officers and
directors as a group - 406,706 shares.
(8) Includes 15 shares of Common Stock owned by Mr. Schwartz's son, as to
which shares Mr. Schwartz disclaims beneficial interest.
(9) Based solely on Schedule 13G filed by such person on February 14, 2007.
Such person has shared voting power as to 507,904 shares of Class A
Common Stock and shared dispositive power as to 507,904 shares of Class
A Common Stock.
(10) Based solely on Schedule 13G filed by such person on January 29, 2007.
Such person has shared voting power as to 493,825 shares of Class A
Common Stock and shared dispositive power as to 493,825 shares of Class
A Common Stock.
(11) Based solely on Schedule 13G filed by such person on February 15, 2007.
Such person has sole voting power as to 325,875 shares of Class A Common
Stock and shared dispositive power as to 450,875 shares of Class A
Common Stock.
(12) Based solely on Schedule 13G filed by such person on February 14, 2007.
Such person has sole voting power as to 379,694 shares of Class A
Common Stock and sole dispositive power as to 407,394 shares of Class
A Common Stock.
(13) Based solely on Schedule 13G filed by such person on February 7, 2007.
Such person has sole voting power as to 357,930 shares of Class A Common
Stock and sole dispositive power as to 397,400 shares of Class A Common
Stock.
(14) Beneficial ownership on this table includes the following shares of
Class A Common Stock which may be purchased by exercise of options which
are presently exercisable or which will become exercisable within 60
days: Mr. Schwartz - 264,500 shares; Mr. Yoshimoto - 115,000 shares; Mr.
Aoki - 6,667 shares; Mr. Garcia - 97,750 shares; Mr. Abdo - 92,667
shares; Mr. Becker - 75,417 shares; Mr. Sturges - 26,667 shares; Mr.
Jaffe - 26,667 shares; Mr. Castell - 16,667 shares; Mr. West - 16,667
shares; all officers and directors as a group - 738,667 shares.
(15) Includes 1 share of Class A Common Stock owned by Mr. Schwartz's son, as
to which share Mr. Schwartz disclaims beneficial interest.
(16) Based solely on the most recent Form 4 filed by Mr. Burris on July 18,
2006. Includes 575 shares of Common Stock owned by Mr. Burris's wife, as
to which Mr. Burris disclaims beneficial interest.
(17) Based solely on the most recent Form 4 filed by Mr. Burris on July 18,
2006. Includes 1,150 shares of Class A Common Stock owned by Mr.
Burris's wife, as to which Mr. Burris disclaims beneficial interest.
19
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Benihana of Tokyo, Inc. ("BOT") owns shares representing approximately 25% of
the votes represented by the Company's Common Stock, which class elects 75% of
the directors.
The Company sold an aggregate 800,000 shares of its Series B Preferred Stock to
BFC Financial Corporation ("BFC"), a diversified holding company with operations
in banking, real estate and other industries for $20 million. John E. Abdo, a
director of the Company, is a director and Vice Chairman of the Board of BFC and
is a significant shareholder of BFC. The sale of Series B Preferred Stock was
completed in two tranches during fiscal years 2005 and 2006. The sale of Series
B Preferred Stock resulted in net aggregate proceeds of $19,137,000 ($9,253,000
in fiscal 2005 and $9,884,000 in fiscal 2006).
BOT commenced a lawsuit in the Delaware Chancery Court against the Company,
individuals who were then members of the Company's Board of Directors and BFC,
in connection with the closing of the $20.0 million sale of the Company's Series
B Preferred Stock to BFC. After a trial, the Chancery Court rejected all claims
asserted against the Company and its directors finding that "the directors who
approved the transaction did so, on an informed basis, acting in good faith and
believing that they were acting in the best interests of Benihana." Thereafter,
BOT filed an appeal with respect to the decision of the Chancery Court, and on
August 24, 2006, the Delaware Supreme Court issued an opinion affirming the
trial court's ruling in favor of the Company and the Board of Directors in all
respects.
A trust, of which Kevin Y. Aoki, a director and former Vice President -
Marketing of the Company, and Grace Aoki, and Kyle Aoki, Kevin's siblings, are
the trustees, is the owner of the BOT stock.
BOT owns a Benihana restaurant in Honolulu, Hawaii (the "Honolulu Restaurant")
and all rights to the Benihana name and trade names, service marks and
proprietary systems outside the territory served by the Company which consists
of the United States (except for rights related to the State of Hawaii) and
Central and South America and the islands of the Caribbean Sea. The Company also
granted to BOT a perpetual license to operate the Honolulu Restaurant and an
exclusive license to own and operate Benihana restaurants in Hawaii. This
license is royalty-free with respect to any Hawaiian restaurant beneficially
owned by Rocky H. Aoki. The Company has a right of first refusal to purchase any
Hawaiian restaurant or any joint venture or sublicensing thereof proposed to be
made by BOT with an unaffiliated third party; and, in the event any Hawaiian
restaurant is sold, sublicensed or transferred to a third party not affiliated
with Rocky H. Aoki, the Company will be entitled to receive royalties from such
restaurant equal to 6% of gross revenues.
In April 2006, the Company sold the assets of its sole Doraku restaurant to Aoki
Group LLC, an entity indirectly controlled by Kevin Aoki, the Company's former
Vice President of Marketing and a current member of the Board of Directors. The
assets were sold for $539,000, after adjustment, as determined by an independent
appraisal. The transaction was approved by the Board of Directors. Pursuant to
the sale agreement, Kevin Aoki extended the non-competition provision of his
employment agreement through August 31, 2008, but Mr. Aoki is permitted (i) to
own, operate and manage Sushi Doraku restaurants in Hawaii and in Miami-Dade
County, Florida, provided any such restaurants in Miami-Dade County are not
within a seven mile radius of any existing or proposed restaurants then being
operated by the Company or any of its subsidiaries or franchisees and (ii) to
have an interest in any other additional Sushi Doraku restaurants with the prior
written consent, not to be unreasonably withheld, of a committee of Benihana's
Board of Directors. Additionally, the Company paid Mr. Aoki approximately
$56,000 upon his resignation from the Company, representing the remainder of his
unearned salary under an employment agreement with a term expiring as of August
31, 2006. Consistent with SFAS No. 146, "Accounting for Costs Associated with
Exit or Disposal Activities," these items are reflected in the Company's fiscal
2007 results. The financial impact of this transaction was nominal.
While the assets of the Doraku restaurant meet the definition of "discontinued
operations," as defined in SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," the Company has not segregated Doraku's assets
and results of operations, as the amounts are immaterial. Assets held for sale
at March 26, 2006, totaled $499,000, and net income (loss) totaled approximately
$41,000, $24,000 and $(296,000) for fiscal years 2007, 2006 and 2005,
respectively.
Darwin C. Dornbush, the Company's Secretary and a retired Director of the
Company, is a partner at Dornbush Schaeffer Strongin & Venaglia, LLP, formerly
known as Dornbush Schaeffer Strongin & Weinstein, LLP, a law firm which has
performed and continues to perform significant legal services for the Company.
In the fiscal years 2007, 2006, and 2005, the Company incurred approximately
$841,000, $660,000 and $650,000, respectively, in legal fees and expenses to
Dornbush Schaeffer Strongin & Venaglia, LLP.
20
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following table sets forth fees for professional audit services rendered by
Deloitte & Touche LLP for the audit of the Company's annual financial statements
included in the Company's Annual Report on Form 10-K and review of financial
statements included in the Company's quarterly reports on Form 10-Q for fiscal
years 2006 and 2007, and fees billed for other services rendered by Deloitte &
Touche LLP.
2006 2007
---- ----
Audit Fees (1) $707,925 $713,867
Audit Related Fees (2) 8,000 24,535
Tax Fees (3) -0- -0-
All Other Fees -0- -0-
------------------
(1) The fees consisted of the audit of the Company's Consolidated Financial
Statements included in the Company's Annual Report on Form 10-K and
reviews of its interim financial statements included in the Company's
quarterly reports on Form 10-Q.
(2) The audit related fees consisted of services incurred for the audit of
the Company's Employee Benefit Plan.
(3) The Audit Committee has determined that the provisions of all non-audit
services performed for the Company by Deloitte & Touche LLP is
compatible with maintaining that firm's independence.
The Audit Committee's policy is to pre-approve all audit services and all
non-audit services that the Company's independent auditor is permitted to
perform for the Company under applicable federal security regulations. While it
is the general policy of the Audit Committee to make such determinations at full
Audit Committee meetings, the Audit Committee may delegate its pre-approval
authority to one or more members of the Audit Committee, provided that all such
decisions are presented to the full Audit Committee at its next regularly
scheduled meeting.
21
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
3. Exhibits:
13.01 Portions of Annual Report to Stockholders for the year
ended April 1, 2007. Incorporated by reference to
Exhibit 13.01 of the 2007 10-K.
31.01 Chief Executive Officer's certification pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
31.02 Chief Financial Officer's certification pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
32.01 Chief Executive Officer's certification pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
32.02 Chief Financial Officer's certification pursuant to
Section 906 of the Sarbanes-Oxley Act of 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.
Date: July 30, 2007 BENIHANA INC.
By: /s/ Joel A. Schwartz
----------------------------
Joel A. Schwartz, CEO
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed on the date indicated above by the following persons on behalf
of the registrant and in the capacities indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Joel A. Schwartz Chief Executive Officer and July 30, 2007
----------------------- Chairman of the Board of Directors
Joel A. Schwartz (Principal Executive Officer)
/s/ Taka Yoshimoto Executive Vice President - July 30, 2007
----------------------- Restaurant Operations
Taka Yoshimoto and Director
/s/ Jose I. Ortega Vice President of July 30, 2007
----------------------- Finance and Treasurer -
Jose I. Ortega Chief Financial Officer
(Principal Financial and
Accounting Officer)
/s/ John E. Abdo Director July 30, 2007
-----------------------
John E. Abdo
/s/ Kevin Y. Aoki Director July 30, 2007
-----------------------
Kevin Y. Aoki
/s/ Norman Becker Director July 30, 2007
-----------------------
Norman Becker
/s/ J. Ronald Castell Director July 30, 2007
-----------------------
J. Ronald Castell
/s/ Lewis Jaffe Director July 30, 2007
-----------------------
Lewis Jaffe
/s/ Robert B. Sturges Director July 30, 2007
-----------------------
Robert B. Sturges
/s/ Joseph J. West Director July 30, 2007
-----------------------
Joseph J. West
23
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-K/A’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 3/31/09 | | 10 | | 15 | | | 4 |
| | 8/31/08 | | 21 |
| | 10/29/07 | | 17 |
| Filed on: | | 7/30/07 | | 24 |
| | 7/3/07 | | 17 | | | | | 4 |
| | 7/1/07 | | 2 |
| | 6/15/07 | | 2 | | 20 | | | 10-K, S-8 |
| | 6/7/07 | | 7 |
| | 6/1/07 | | 12 | | 20 |
| | 5/31/07 | | 1 |
| For Period End: | | 4/1/07 | | 1 | | 23 |
| | 2/15/07 | | 20 | | | | | 4, SC 13G |
| | 2/14/07 | | 20 | | | | | SC 13G, SC 13G/A |
| | 2/7/07 | | 20 | | | | | SC 13G |
| | 1/29/07 | | 20 | | | | | SC 13G/A |
| | 10/8/06 | | 1 | | | | | 10-Q, NT 10-Q |
| | 9/1/06 | | 6 | | 9 | | | 3, 4 |
| | 8/31/06 | | 6 | | 21 | | | 4, 8-K |
| | 8/28/06 | | 10 | | | | | 8-K |
| | 8/24/06 | | 21 | | | | | 8-K |
| | 7/18/06 | | 20 | | | | | 4 |
| | 4/21/06 | | 16 | | | | | 8-K |
| | 4/1/06 | | 10 | | | | | 10-K |
| | 3/27/06 | | 16 |
| | 3/26/06 | | 21 | | | | | 10-K, 10-K/A, NT 10-K |
| | 10/17/05 | | 10 | | | | | 4, 8-K |
| | 5/27/04 | | 10 |
| | 9/1/03 | | 10 |
| | 4/1/01 | | 10 | | | | | 10-K, 10-K/A, DEF 14A |
| | 2/9/01 | | 17 | | | | | SC 13G/A |
| List all Filings |
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