-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VocBR0ihG29SR6ffHet8ffOocVAqpcE5CVBy9tU57maIxwNKMm+aM1sAyoG9nFKP flCbyRpL4Ww8HIPhmNeJjw== 0001005477-97-001996.txt : 19970813 0001005477-97-001996.hdr.sgml : 19970813 ACCESSION NUMBER: 0001005477-97-001996 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970629 FILED AS OF DATE: 19970812 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MORTONS RESTAURANT GROUP INC CENTRAL INDEX KEY: 0000883981 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 133490149 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-12692 FILM NUMBER: 97657153 BUSINESS ADDRESS: STREET 1: 3333 NEW HYDE PK RD STE 210 CITY: NEW HYDE PARK STATE: NY ZIP: 11042 BUSINESS PHONE: 5166271515 MAIL ADDRESS: STREET 1: 3333 NEW HYDE PARK ROAD STREET 2: SUITE 210 CITY: NEW HYDE PARK STATE: NY ZIP: 11042 FORMER COMPANY: FORMER CONFORMED NAME: QUANTUM RESTAURANTS GROUP INC DATE OF NAME CHANGE: 19950315 10-Q 1 FORM 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 29, 1997 ----------------------------------------------- OR [ ] 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 1-12692 ----------------------------------------------- MORTON'S RESTAURANT GROUP, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 13-3490149 - -------------------------------------------------------------------------------- (State or other jurisdiction (I.R.S. employer identification no.) of incorporation or organization) 3333 New Hyde Park Road, Suite 210, New Hyde Park, New York 11042 - -------------------------------------------------------------------------------- (Address of principal executive offices) (zip code) 516-627-1515 - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) 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 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 |_| As of August 7, 1997, the registrant had 6,520,340 Shares of its Common Stock, $.01 par value, issued and outstanding. 1 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES INDEX Part I - Financial Information Page - ------------------------------ ---- Item 1. Financial Statements Consolidated Balance Sheets as of June 29, 1997 and December 29, 1996 3-4 Consolidated Statements of Income for the three and six month periods ended June 29, 1997 and June 30, 1996 5 Consolidated Statements of Cash Flows for the six month periods ended June 29, 1997 and June 30, 1996 6 Notes to Consolidated Financial Statements 7-9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10-13 Part II - Other Information - --------------------------- Item 1. Legal Proceedings 14 Item 4. Submission of Matters to a Vote of Stockholders 14 Item 6. Exhibits and Reports on Form 8-K 14 Signatures 15 2 Item 1. Financial Statements MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets (amounts in thousands) June 29, December 29, 1997 1996 ---- ---- (unaudited) Assets Current assets: Cash and cash equivalents $ 2,534 $ 2,276 Accounts receivable 2,114 2,116 Inventories 4,642 4,254 Landlord construction receivables, prepaid expenses and other current assets 2,755 2,408 Deferred income taxes 4,116 3,808 Assets held for sale 371 12,474 ------ ------ Total current assets 16,532 27,336 Property and equipment, at cost: Furniture, fixtures and equipment 15,656 13,552 Leasehold improvements 16,644 14,188 Construction in progress 472 1,284 ------ ------ 32,772 29,024 Less accumulated depreciation and amortization 5,345 4,353 ------ ------ Net property and equipment 27,427 24,671 ------ ------ Intangible assets, net of accumulated amortization of $3,256 at June 29, 1997 and $3,054 at December 29, 1996 12,739 12,941 Other assets and deferred expenses, net of accumulated amortization of $3,367 at June 29, 1997 and $3,963 at December 29, 1996 7,855 5,909 Deferred income taxes 4,797 6,129 ------ ------ $69,350 $76,986 ====== ====== (Continued) 3 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets, Continued (amounts in thousands, except share data) June 29, December 29, 1997 1996 ---- ---- (unaudited) Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 4,765 $ 4,694 Accrued expenses 7,559 7,795 Accrued income taxes 426 700 Liabilities related to assets held for sale 3,352 12,134 -------- -------- Total current liabilities 16,102 25,323 Bank debt 21,970 24,900 Other liabilities 6,077 5,676 -------- -------- Total liabilities 44,149 55,899 -------- -------- Commitments and contingencies Stockholders' equity: Preferred stock, $.01 par value per share. Authorized 3,000,000 shares, no shares issued or outstanding -- -- Common stock, $.01 par value per share. Authorized 25,000,000 shares, issued and outstanding 6,493,553 shares at June 29, 1997 and 6,443,673 shares at December 29, 1996 65 64 Nonvoting common stock, $.01 par value per share. Authorized 3,000,000 shares, no shares issued or outstanding -- -- Additional paid-in capital 61,884 61,632 Accumulated deficit (36,748) (40,609) -------- -------- Total stockholders' equity 25,201 21,087 -------- -------- $ 69,350 $ 76,986 ======== ======== See accompanying notes to consolidated financial statements. 4 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Income (amounts in thousands, except per share data)
Three Months Ended Six Months Ended June 29, June 30, June 29, June 30, 1997 1996 1997 1996 ---- ---- ---- ---- (unaudited) (unaudited) Revenues $41,061 $46,476 $87,595 $95,345 Food and beverage costs 14,226 15,639 30,171 31,910 Restaurant operating expenses 17,896 22,702 38,180 46,237 Depreciation, amortization and other non-cash charges 1,826 1,306 3,913 2,900 General and administrative expenses 3,202 3,544 6,892 7,246 Marketing and promotional expenses 975 1,014 2,082 2,152 Interest expense, net 589 574 1,209 1,144 ------ ------ ------ ------ Income before income taxes 2,347 1,697 5,148 3,756 Income tax expense 587 425 1,287 940 ------ ------ ------ ------ Net income $ 1,760 $ 1,272 $ 3,861 $ 2,816 ====== ====== ====== ====== Net income per share $ 0.26 $ 0.19 $ 0.56 $ 0.42 ====== ====== ====== ====== Weighted average shares outstanding 6,844 6,807 6,838 6,773 ====== ====== ====== ======
See accompanying notes to consolidated financial statements. 5 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (amounts in thousands) Six Months Ended June 29, June 30, 1997 1996 ---- ---- (unaudited) Cash flows from operating activities: Net income $ 3,861 $ 2,816 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, amortization and other non-cash charges 3,913 2,900 Deferred income taxes 1,024 500 Change in assets and liabilities: Accounts receivable 2 1,708 Inventories (388) (369) Prepaid expenses and other assets (2,255) (303) Accounts payable, accrued expenses and other liabilities (2,008) (4,095) Accrued income taxes (274) (39) ------ ------ Net cash provided by operating activities 3,875 3,118 ------ ------ Cash flows from investing activities: Purchases of property and equipment, net (3,438) (2,527) Payments for start-up costs, licenses and other deferred expenses (1,966) (2,724) Proceeds from sale of Mick's and Peasant restaurants 4,308 -- ------ ------ Net cash used by investing activities (1,096) (5,251) ------ ------ Cash flows from financing activities: Principal reduction on bank debt (7,624) (2,100) Proceeds from bank debt 4,850 4,400 Payments on note payable to related party -- (483) Net proceeds from issuance of stock 253 10 ------ ------ Net cash provided (used) by financing activities (2,521) 1,827 ------ ------ Net increase (decrease) in cash and cash equivalents 258 (306) Cash and cash equivalents at beginning of period 2,276 2,351 ------ ------ Cash and cash equivalents at end of period $ 2,534 $ 2,045 ====== ====== See accompanying notes to consolidated financial statements. 6 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements June 29, 1997 and June 30, 1996 1) The accompanying unaudited, consolidated financial statements have been prepared in accordance with instructions to Form 10-Q and, therefore, do not include all information and footnotes normally included in financial statements prepared in conformity with generally accepted accounting principles. They should be read in conjunction with the consolidated financial statements of Morton's Restaurant Group, Inc., formerly known as Quantum Restaurant Group, Inc., (the "Company") for the fiscal year ended December 29, 1996, filed by the Company on Form 10-K with the Securities and Exchange Commission on March 27, 1997. The accompanying financial statements are unaudited and include all adjustments (consisting of normal recurring adjustments and accruals) that management considers necessary for a fair presentation of its financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the entire year. On May 9, 1996, at the Company's Annual Meeting of Stockholders, the stockholders voted to change the name of the Company from Quantum Restaurant Group, Inc. to Morton's Restaurant Group, Inc. The Company uses a fiscal reporting period ending on the closest Sunday to December 31. The fiscal year consists of 52 weeks and approximately every six or seven years, a 53rd week will be added. 2) For the purposes of the consolidated statements of cash flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. The Company paid cash interest and fees, net of amounts capitalized, of approximately $965,000 and $1,004,000, and income taxes of approximately $835,000 and $506,000, for the six months ended June 29, 1997 and June 30, 1996, respectively. During the first six months of fiscal 1997 and 1996, the Company entered into capital lease arrangements of approximately $777,000 and $1,100,000, respectively, for restaurant equipment. 3) As described below, on February 6, 1997, the Company completed the sale of its Atlanta-based Mick's and Peasant restaurants. Effective January 2, 1995, the Company adopted Statement of Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of " ("Statement 121"). During the second quarter of fiscal 1995, the Company approved a plan for the sale of Mick's Restaurants, Inc. ("Mick's") and The Peasant Restaurants, Inc. ("Peasant"). Pursuant to Statement 121, the Company discontinued depreciating fixed assets and amortizing goodwill relating to Mick's and Peasant in April 1995. Coincident with the Company's approval of the plan of sale, the assets held for sale and related liabilities for Mick's and Peasant have been reclassified as "Assets held for sale" and "Liabilities related to assets held for sale" when the Company reports its financial position. The accompanying consolidated balance sheets include the following components: 7 June 29, December 29, 1997 (1) 1996 ---- ---- (amounts in thousands, unaudited) Current assets $ 371 $ 2,166 Net property and equipment 1,897 10,704 Unamortized goodwill -- 8,077 Other assets 765 2,143 Write-down of carrying values (2,662) (10,616) ---------- ------- Assets held for sale 371 12,474 ---------- ------- Current liabilities 478 3,495 Other liabilities -- 1,612 Lease exit and other transaction costs 2,874 7,027 ---------- ------- Liabilities related to assets held for sale 3,352 12,134 ---------- ------- Net assets (liabilities related to assets) held for sale $ (2,981) $ 340 ========== ======= (1) Includes the four remaining non-Atlanta Mick's restaurants. The following represents the combined results of Mick's and Peasant for the periods ended June 29, 1997 and June 30, 1996. Interest expense was not allocated. Six Months Ended June 29, June 30, 1997 (2) 1996 ---- ---- (amounts in thousands, unaudited) Revenues $ 7,181 $28,451 Food and beverage costs 2,151 8,395 Restaurant operating expense 4,320 17,948 Depreciation, amortization and other non-cash charges 6 103 General and administrative expenses 477 2,053 Marketing and promotional expenses 123 561 ------- ------ Income (loss) before income taxes $ 104 $ (609) ======= ====== (2) Includes the Atlanta-based Mick's and Peasant restaurants through February 6, 1997, the date of sale, as discussed below, one non-Atlanta Mick's restaurant which was closed in June 1997, and the four remaining non-Atlanta Mick's restaurants which the Company intends to sell or otherwise dispose of. Management had been actively seeking potential buyers for the sale of all Mick's and Peasant restaurants and in the fourth quarter of fiscal 1995 engaged an investment banking firm to assist with the sale. Although marketing efforts concentrated on selling all of the Mick's and Peasant restaurants, sales materials indicated that a partial sale would be considered. Most of the interest received related to the majority of the restaurants located mainly in the Atlanta area. No meaningful offers were received for the remaining 8 restaurants (the "Remaining Restaurants"). Cash flow analyses prepared by management for the Remaining Restaurants indicated that it would be less costly to close such restaurants in an orderly fashion, rather than continue to operate them through the end of their respective lease terms. Accordingly, assets of $8,300,000 related to the Remaining Restaurants were written off and expenses of $7,200,000, representing management's estimate of the expected costs to terminate related leases, were accrued at December 31, 1995. During fiscal 1996 and the first six months of 1997, restaurant occupancy expense of approximately $1,498,000 and $647,000 for the Remaining Restaurants has been charged against the accrual for lease exit costs, respectively. During fiscal 1996, seven Mick's restaurants and two Peasant restaurants were closed. During 1997, two Mick's restaurants were closed in January, one Mick's was closed in June 1997 and another was closed in July 1997. On February 6, 1997, the Company completed the sale of its Atlanta-based Mick's and Peasant restaurants. In connection with the sale, the Remaining Restaurants were transferred to another subsidiary of the Company. Pursuant to these agreements, MRI Acquisition Corporation acquired an 80.1% interest in Mick's and PRI Acquisition Corporation acquired an 80.1% interest in Peasant for an aggregate of $6,800,000, consisting of $4,300,000 in cash and $2,500,000 in the form of two unsecured promissory notes. The Company retained a 19.9% interest in Mick's and Peasant. In conjunction with the sale, the Company had recorded a fiscal 1996 fourth quarter charge of $11,500,000 to write-down the Atlanta-based restaurants to their net realizable values based on the fair value of the consideration received, accrue for the various expenses related to the closing of such sale and to write-off two restaurants which are not part of the sale, both of which were closed in 1997. As of July 1997, the Company continues to operate three Mick's restaurants which the Company intends to sell or otherwise dispose of. The write-down and related charges for net assets held for sale reflect management's best estimate of the costs expected to be incurred in connection with the disposition of Mick's and Peasant. As a result of the numerous uncertainties which may impact the actual costs to be incurred by the Company, such costs may differ from the current estimates used by management. 4) The Company is involved in various legal actions. See "Part II - Other Information, Item 1. Legal Proceedings" on page 14 of this Form 10-Q for a discussion of these legal actions. 9 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Revenues decreased $5.4 million, or 11.7%, to $41.1 million for the three month period ended June 29, 1997, from $46.5 million for the comparable 1996 period. Revenues from Morton's and Bertolini's increased $6.3 million, or 18.8%, to $39.6 million for the three month period ended June 29, 1997, from $33.3 million during the comparable 1996 period. Of the increase in Morton's and Bertolini's revenues, $4.3 million was attributable to incremental restaurant revenues from seven new restaurants opened after January 1, 1996 and $2.0 million, or 6.6%, was attributable to additional comparable revenues from restaurants open all of both periods. Average Morton's and Bertolini's revenues per restaurant open for a full period increased 8.6%. Revenues decreased $7.8 million, or 8.1%, to $87.6 million for the six month period ended June 29, 1997, from $95.3 million for the comparable 1996 period. Revenues from Morton's and Bertolini's increased $13.0 million, or 20.2%, to $80.4 million for the six month period ended June 29, 1997, from $66.9 million for the comparable 1996 period. Of the increase in Morton's and Bertolini's revenues, $9.2 million was attributable to incremental restaurant revenues from seven new restaurants opened after January 1, 1996 and $3.8 million, or 6.1%, was attributable to additional comparable revenues from restaurants open all of both periods. Average Morton's and Bertolini's revenues per restaurant open for a full period increased 7.3%. Included in 1997 six month revenues is approximately $0.5 million of investment income. As stated in Note 3, the Company completed the sale of its Atlanta-based Mick's and Peasant restaurants on February 6, 1997. Nine other non-Atlanta Mick's and Peasant restaurants were closed during fiscal 1996 and four additional Mick's have been closed during fiscal 1997. As a result, revenues for the Mick's and Peasant restaurants decreased approximately $11.7 million and $21.3 million in the three and six month periods ended June 29, 1997 versus the comparable periods of 1996. As of July 1997, the Company continues to operate three Mick's restaurants which the Company intends to sell or otherwise dispose of. Percentage changes in comparable restaurant revenues for the three and six month periods ended June 29, 1997 versus June 30, 1996 for restaurants open all of both periods are as follows: Three Months Six Months Ended June 29, 1997 Ended June 29, 1997 Percentage Change Percentage Change ----------------- ----------------- Morton's 8.1% 7.9% Bertolini's -0.1% -2.1% Total 6.6% 6.1% The Company believes that revenues for the first quarter of 1996 were adversely affected by severe winter storms in January 1996. 10 Food and beverage costs decreased from $15.6 million for the three month period ended June 30, 1996 to $14.2 million for the three month period ended June 29, 1997 and decreased from $31.9 million for the six month period ended June 30, 1996 to $30.2 million for the six month period ended June 29, 1997. Food and beverage costs, excluding all Mick's and Peasant restaurants, increased by $2.1 million to $13.8 million for the three month period ended June 29, 1997 from $11.7 million recorded for the three month period ended June 30, 1996 and increased by $4.5 million to $28.0 million for the six month period ended June 29, 1997, from $23.5 million for the comparable 1996 period. These costs as a percentage of related revenues decreased 0.4% for the three and six month periods. As a result of the sale and closings of the Mick's and Peasant restaurants as discussed in Note 3, there was a reduction in food and beverage costs of approximately $3.5 million and $6.2 million in the three and six month periods ended June 29, 1997 and June 30, 1996, respectively. Restaurant operating expenses which include labor, occupancy and other operating expenses decreased from $22.7 million for the three month period ended June 30, 1996 to $17.9 million for the three month period ended June 29, 1997, a decrease of $4.8 million. For the six months ended June 29, 1997, these costs decreased from $46.2 million during the 1996 period, to $38.2 million for the comparable 1997 period. Restaurant operating expenses, excluding all Mick's and Peasant restaurants, increased from $14.4 million for the three month period ended June 29, 1996 to $17.0 million for the comparable 1997 period and increased from $28.3 million for the six month period ended June 30, 1996 to $33.9 million for the comparable 1997 period. Those costs, excluding Mick's and Peasant, as a percentage of revenues decreased 0.1% from 43.1% for the three month period ended June 30, 1996 to 43.0% for the three month period ended June 29, 1997 and decreased 0.2% from 42.3% for the six month period ended June 30, 1996 to 42.1% for the comparable 1997 period. Offsetting the increase in total restaurant operating expenses was a reduction of approximately $7.5 million and $13.6 million during the three and six month periods ended June 29, 1997 versus the comparable 1996 periods, respectively, due to the sale and closings of Mick's and Peasant restaurants as discussed in Note 3. Depreciation, amortization and other non-cash charges increased from $1.3 million for the three month period ended June 30, 1996 to $1.8 million for the three month period ended June 29, 1997 and increased from 2.8% of revenues to 4.4%, respectively. For the six months ended June 29, 1997, such costs were $3.9 million versus $2.9 million for the comparable 1996 period. The 1997 period increase is due to increased startup amortization. General and administrative expenses for the three month period ended June 29, 1997 were $3.2 million, a decrease of $0.3 million, from $3.5 million for the three month period ended June 30, 1996. For the six months ended June 29, 1997, such costs were $6.9 million versus $7.2 million for the comparable 1997 period. General and administrative expenses, excluding all Mick's and Peasant restaurants, increased $0.6 million from $2.5 million for the three month period ended June 30, 1996 to $3.1 million for the comparable 1997 period and increased $1.2 million from $5.2 million for the six month period ended June 30, 1996, to $6.4 million for the comparable 1997 period. Such costs, excluding Mick's and Peasant, as a percentage of revenues were 8.0% for the three month period ended June 29, 1997, an increase of 0.4% from the three month period ended June 30, 1996 and 8.0% for the six months ended June 29, 1997, an increase of 0.2% from the six months ended June 30, 1996. The increase in such expense is driven by incremental costs associated with increased restaurant development. General and administrative expenses relating to the Mick's and Peasant restaurant groups decreased $1.0 million and $1.6 million during the three and six month periods ended June 29, 1997, respectively, versus the comparable 1996 period as a result of the sale and closings of Mick's and Peasant restaurants as discussed in Note 3. 11 Marketing and promotional expenses were $1.0 million and $2.0 million for the three and six month periods ended June 29, 1997 and June 30, 1996, respectively. Marketing and promotional expenses, excluding Mick's and Peasant, were $1.0 million, or 2.4% of revenues for the three months ended June 29, 1997, as compared to $0.7 million, or 2.2% of revenues, for the comparable 1996 period and were $2.0 million, or 2.4% of revenues for the six months ended June 29, 1997, as compared to $1.6 million, or 2.4% of revenues, for the comparable 1996 period. The increase is driven by incremental costs associated with increased restaurant development. Mick's and Peasant marketing and promotional expenses decreased $0.3 million and $0.4 million during the three and six month periods ended June 29, 1997, respectively, versus the comparable 1996 periods. Interest expense, net of interest income, remained constant at $0.6 million for the three month periods ended June 29, 1997 and June 30, 1996. For the six month period ended June 29, 1997, interest expense was $1.2 million, versus $1.1 million for the comparable 1996 period. Income tax expense of $1.3 million for the six month period ended June 29, 1997 represents Federal income taxes, which were partially offset by the establishment of additional deferred tax assets relating to FICA and other tax credits that were generated during fiscal 1997, as well as state income taxes. Liquidity and Capital Resources In the past, the Company has had, and may have in the future, negative working capital balances. The Company does not have significant receivables or inventories and receives trade credit based upon negotiated terms in purchasing food and supplies. Funds available from cash sales not needed immediately to pay for food and supplies or to finance receivables or inventories were used for noncurrent capital expenditures and/or payments of long-term debt balances under revolving credit agreements. The Company and BankBoston, N.A. (formerly The First National Bank of Boston) entered into the Second Amended and Restated Revolving Credit and Term Loan Agreement dated as of June 19, 1995, as amended from time to time (collectively the "Credit Agreement"), pursuant to which the Company's credit facility is $32,500,000, consisting of a $15,000,000 term loan (the "Term Loan") and a $17,500,000 revolving credit facility (the "Revolving Credit Facility"). The final maturity date is December 31, 2002. Loans made pursuant to the Credit Agreement bear interest at a rate equal to the lender's base rate (plus applicable margin) or, at the Company's option, the Eurodollar Rate (plus applicable margin). At June 29, 1997, the Company's applicable margin, calculated pursuant to the Credit Agreement, was 0.00% on base rate loans and 2.0% on Eurodollar Rate loans. The Company has no outstanding futures contracts or interest rate hedge agreements. During fiscal 1996, BankBoston syndicated portions of the Term Loan and Revolving Credit Facility of the Credit Agreement to two additional lenders, Imperial Bank and Heller Financial. BankBoston, as agent for the Lenders, receives an annual fee of $10,000 paid by the Company. As of June 29, 1997 and December 29, 1996, the Company had outstanding borrowings of $19,650,000 and $24,900,000, respectively, under the Credit Agreement. At June 29, 1997, $221,000 was restricted for letters of credit issued by the lender on behalf of the Company. Unrestricted and undrawn funds available to the Company under the Credit Agreement were $12,629,000. The weighted average interest rate on all bank borrowings on June 29, 1997 was 7.83%. In addition, the Company is obligated to pay fees of 0.25% on unused loan commitments less than $10,000,000, 0.375% on unused loan commitments greater than $10,000,000 and a per annum letter of credit fee (based on the face amount thereof) equal to the applicable margin on the Eurodollar Rate loans. 12 The availability under the Credit Agreement is scheduled to reduce by $1,000,000 on June 30, 1999 and thereafter principal installments on the Term Loan of $1,000,000 each will be due at the end of each calendar quarter through December 31, 2002. The Revolving Credit Facility will be payable in full on December 31, 2002. Borrowings under the Credit Agreement are secured by all tangible and intangible assets of the Company. Total amounts of principal payable by the Company under the Credit Agreement during the five years subsequent to June 29, 1997 amount to $0 in 1997, $0 in 1998, $3,000,000 in 1999, $4,000,000 in 2000, $4,000,000 in 2001 and $8,650,000 in 2002. As stated in Note 3 to the accompanying consolidated financial statements, the Company has completed the sale of its Atlanta-based Mick's and Peasant restaurants. Net cash proceeds from the sale were used to reduce the Company's Revolving Credit Facility. The Credit Agreement contains certain restrictive covenants with respect to the Company that, among other things, create limitations (subject to certain exceptions) on: (i) the incurrence or existence of additional indebtedness or the granting of liens on assets or contingent obligations; (ii) the making of investments in any person; (iii) mergers, dispositions of assets or consolidations; (iv) prepayment of certain other indebtedness; (v) making capital expenditures above specified amounts; and (vi) the ability to make certain fundamental changes or to change materially the present method of conducting the Company's business. The Credit Agreement also requires the Company to satisfy certain financial ratios and tests. As of June 29, 1997, the Company believes it was in compliance with such covenants. In March 1997, a subsidiary of the Company and CNL Financial I, Inc. ("CNL") entered into a $2,500,000 loan agreement (the "CNL Loan"), which matures on April 1, 2007 and has a 10.02% per annum interest rate. Principal and interest payments will be made over the term of the loan. Proceeds from the CNL loan were used to reduce the Company's Revolving Credit Facility. At June 29, 1997 the outstanding principal balance of the CNL Loan was $2,476,000, of which approximately $156,000 is payable within the next fiscal year and therefore has been included in "Accrued expenses" in the accompanying consolidated balance sheet for the period ended June 29, 1997. During the first six months of fiscal 1997, the Company's net investment in fixed assets and related investment costs, net of capitalized leases approximated $5.4 million. The Company estimates that it will expend up to an aggregate of $12.0 million in 1997 to finance ordinary refurbishment of existing restaurants and pre-opening costs and capital expenditures, net of landlord development and rent allowances and net of equipment lease financing, for new restaurants. The Company has entered into various equipment lease financing agreements with several financial institutions of which approximately $9.1 million in the aggregate has been funded from February 1994 through July 1997 and $7.4 million in the aggregate is available for future fundings. The Company anticipates that funds generated through operations and funds available through equipment lease commitments as well as those available under the Credit Agreement will be sufficient to fund planned expansion. In addition, the Company is entering the international market. A lease has been signed to open a Morton's of Chicago restaurant in Singapore and other international opportunities are being investigated. Forward-Looking Statements Except for the historical information contained in this Form 10-Q, certain statements made herein are forward-looking statements that involve risks and uncertainties and are subject to important factors that could cause actual results to differ materially from these forward-looking statements, including without limitation, the effect of economic and market conditions, the impact of competitive activities, the Company's expansion plans, restaurant profitability levels and other risks detailed in the Company's public reports and SEC filings. 13 MORTON'S RESTAURANT GROUP, INC. AND SUBSIDIARIES Part II - Other Information Item 1. Legal Proceedings The Company is involved in various legal actions incidental to the normal conduct of its business. Management does not believe that the ultimate resolution of these actions will have a material adverse effect on the Company's consolidated financial position, equity, results of operations, liquidity and capital resources. Item 4. Submission of Matters to a Vote of Stockholders No matters were submitted to a vote of stockholders during the quarter for which this report was filed. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits. 4.04 (i) Seventh Amendment to the Second Amended and Restated Revolving Credit and Term Loan Agreement, dated June 27, 1997 among the Registrant, Peasant Holding Corp., Morton's of Chicago, Inc. and BankBoston, N.A., individually and as agent. 27.00 Financial Data Schedule (b) Reports on Form 8-K. No reports on Form 8-K were filed during the quarter for which this report was filed. 14 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. MORTON'S RESTAURANT GROUP, INC. (Registrant) Date August 12, 1997 -------------------- By: /s/ ALLEN J. BERNSTEIN ------------------------------------ Allen J. Bernstein Chairman of the Board and Chief Executive Officer Date August 12, 1997 By: /s/ THOMAS J. BALDWIN --------------------- ------------------------------------ Thomas J. Baldwin Executive Vice President and Chief Financial Officer 15 INDEX TO EXHIBITS The following is a list of all exhibits filed as part of this report. Exhibit Number Page Document ------ ---- -------- 4.04(i) Seventh Amendment to the Second Amended and Restated Revolving Credit and Term Loan Agreement, dated June 27, 1997 among the Registrant, Peasant Holding Corp., Morton's of Chicago, Inc. and BankBoston, N.A., individually and as agent 27.00 Financial Data Schedule EX-4.04(I) 2 AMENDMENT TO REVOLVING CREDIT & TERM LOAN AGMT. Exhibit 4.04(i) SEVENTH AMENDMENT TO SECOND AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT This SEVENTH AMENDMENT (this "Amendment"), dated as of June 27, 1997, by and among MORTON'S RESTAURANT GROUP, INC., a Delaware corporation (formerly known as Quantum Restaurant Group, Inc.) having its principal place of business at Suite 210, 3333 New Hyde Park Road, New Hyde Park, New York 11042 (referred to below and in the Credit Agreement, as defined below, as "Quantum"), PEASANT HOLDING CORP., a Delaware corporation having its principal place of business at Suite 210, 3333 New Hyde Park Road, New Hyde Park, New York 11042 ("Peasant Holding"), MORTON'S OF CHICAGO, INC., an Illinois corporation with its principal place of business at 350 West Hubbard Street, Chicago, Illinois 60610 ("Morton's") (Quantum, Peasant Holding and Morton's are referred to herein collectively as the "Borrowers", and each, individually, as a "Borrower"), BANKBOSTON, N.A. (formerly known as The First National Bank of Boston), as Agent (the "Agent") for the Lenders (as defined in the Credit Agreement referred to below), BANKBOSTON, N.A. (formerly known as The First National Bank of Boston and referred to below and in the Credit Agreement, as defined below, as "FNBB") in its individual capacity as a Lender, IMPERIAL BANK, as a Lender, and HELLER FINANCIAL, INC., as a Lender, amends the Second Amended and Restated Revolving Credit and Term Loan Agreement dated as of June 19, 1995, as amended by the First Amendment dated as of February 14, 1996, the Second Amendment dated as of March 5, 1996, a letter agreement dated as of May 2, 1996, the Third Amendment dated as of June 28, 1996 (the "Third Amendment"), the Fourth Amendment dated as of December 26, 1996, the Fifth Amendment dated as of December 31, 1996, the Sixth Amendment dated as of February 6, 1997, and as the same may be further amended, modified, or supplemented from time to time (the "Credit Agreement"), by and among the Borrowers, the Agent, and the Lenders. Capitalized terms used but not defined herein shall have the meanings set forth in the Credit Agreement. WHEREAS, the Borrowers have requested the Lenders agree to increase the Revolving Credit Commitment Amount, to extend the maturity of the credit facilities provided for in the Credit Agreement, and to amend certain other provisions of the Credit Agreement; and WHEREAS, the Agent and the Lenders, subject to the terms and provisions hereof, have agreed to so amend the Credit Agreement; NOW THEREFORE, the parties hereto hereby agree as follows: ss.1. Amendments to Credit Agreement. Subject to the satisfaction of the conditions precedent set forth in ss.3 hereof, the Credit Agreement is hereby amended as follows: ss.1.1. Changes in Certain Definitions. (a) The definition of Available Net Cash Proceeds in Section 1 of the Credit Agreement (as added by the Third Amendment to the Credit Agreement and as previously amended) is hereby amended to read as follows: -2- "Available Net Cash Proceeds. As to any particular transaction consisting of a Permitted Disposition, 75% of the Net Cash Proceeds thereof." (b) The table contained in the definition of Commitment Percentages in Section 1 of the Credit Agreement is hereby amended to read as follows: "Lender Percentage" ------ ---------- "FNBB 64.28571%" "Imperial Bank 35.71428%" (c) The definition of Final Maturity Date in Section 1 of the Credit Agreement is hereby amended to read as follows: "Final Maturity Date. December 31, 2002." (d) The definition of Revolving Credit Commitment in Section 1 of the Credit Agreement is hereby amended by replacing the phrase "of FNBB is Fifteen Million Dollars ($15,000,000)" with the phrase "is Seventeen Million Five Hundred Thousand Dollars ($17,500,000)". (e) The definition of Revolving Credit Commitment Amount in Section 1 of the Credit Agreement is hereby amended by replacing the phrase "Fifteen Million Dollars ($15,000,000)" with the phrase "Seventeen Million Five Hundred Thousand Dollars ($17,500,000)". (f) The table contained in the definition of Term Loan Percentage in Section 1 of the Credit Agreement (as added by the Fifth Amendment to the Credit Agreement) is hereby amended to read as follows: "Lender Percentage" ------ ---------- "FNBB 41.66667%" "Heller Financial, Inc. 33.33333%" "Imperial Bank 25.00000%" ss.1.2. Mandatory Commitment Reductions. Section 2.l(b)(iii) of the Credit Agreement (as added by the Third Amendment to the Credit Agreement) is hereby amended to read as follows: "(iii) Mandatory Reductions. The Revolving Credit Commitment Amount shall be automatically and immediately reduced from time to time by the Revolving Credit Share of the Available Net Cash Proceeds (if any) received by the Companies in respect of each Permitted Disposition, in each case allocated pro rata among the Lenders in accordance with their respective Commitment Percentages (the "Mandatory Reductions"). No such reduction of the Revolving Credit Commitment Amount shall be subject to reinstatement." -3- ss.1.3. Interest on Revolving Credit Loans. The table contained in Section 2.4(b) of the Credit Agreement is hereby amended to read as follows: ------------------------------------------------ Applicable Applicable Eurodollar Base Rate Margin Rate Margin Leverage Ratio (per annum) (per annum) ------------------------------------------------ >1.25:1.0 0.75% 2.75% ------------------------------------------------ <= 1.25:1.0 and 0.25% 2.25% >1.00:1.0 ------------------------------------------------ <= 1.00:1.0 and 0% 2.00% >0.75:1.0 ------------------------------------------------ <= 0.75:1.0 and 0% 1.75% >0.50:1.0 ------------------------------------------------ <= 0.50:1.0 and 0% 1.375% >0.35:1.0 ------------------------------------------------ <= 0.35:1.0 0% 0.875% ------------------------------------------------ ss.1.4. Term Loan Principal Payments. (a) Section 2.6(c) of the Credit Agreement is hereby amended to read as follows: "(c) Repayments of Principal of Term Loan. (i) Scheduled Payments. The Borrowers jointly and severally promise to pay to the Agent for the ratable accounts of the Lenders the principal of the Term Loan in quarterly installments of $1,000,000 per installment, each due and payable on the last day of each calendar quarter of each calendar year, commencing June 30, 1999, and with a final payment due and payable on the Final Maturity Date in an amount equal to the then unpaid principal balance of the Term Loan. (ii) Mandatory Prepayments. The Borrowers jointly and severally shall be obligated to make prepayments in respect of the principal of the Term Loan immediately at the time of each Permitted Disposition in an amount equal to the Term Loan Share of the Available Net Cash Proceeds (if any) received by the Companies in respect of such Permitted Disposition, in each case payable to the Agent for application in respect of the Term Loan to the ratable accounts of the Lenders (the "Mandatory Prepayments"). Prior to the earlier to occur of (A) the aggregate cumulative amount of principal repaid or prepaid in respect of the Term Loan being equal to at least $1,500,000, or (B) September 30, 1999, the Mandatory Prepayments shall be applied against the scheduled unpaid installments of principal due in respect of the Term Loan in the direct order of their maturity; otherwise, any and all Mandatory Prepayments made hereunder shall be applied against the scheduled unpaid installments of principal due in respect of the Term Loan in the inverse order of their maturity. No such Mandatory Prepayments with respect to the Term Loan may be reborrowed." (b) Section 2.6(d) of the Credit Agreement is hereby amended by deleting the third and fourth sentence thereof and inserting in their places the following: -4- "Prior to the earlier to occur of (A) the aggregate amount of principal repaid or prepaid in respect of the Term Loan being equal to at least $1,500,000, or (B) September 30, 1999, prepayments hereunder shall be applied against the scheduled unpaid installments of principal due in respect of the Term Loan in the direct order of their maturity; otherwise, any and all prepayments made hereunder shall be applied against the scheduled unpaid installments of principal due in respect of the Term Loan in the inverse order of their maturity. No such amount repaid or prepaid with respect to the Term Loan may be reborrowed." ss.1.5. Commitment Fee. Section 4.5 of the Credit Agreement is hereby amended by replacing the number "$5,000,000" with the number "$7,500,000". ss.1.6. Letter of Credit Fee. Section 4A.6 of the Credit Agreement is hereby amended to read as follows: "ss.4.A.6. Letter of Credit Fees. The Borrowers shall pay to the Agent and the Lenders in respect of each Letter of Credit the following fees (the "Letter of Credit Fees"): (a) a fee (in each case, a "Basic Letter of Credit Fee") payable to the Agent quarterly in arrears, on the last day of each calendar quarter, determined in respect of each Letter of Credit (but without duplication for any applicable period for which the Basic Letter of Credit Fee is paid or payable), equal to the sum of (i) the Applicable Rate (as defined below), minus one-eighth of one percent (.125%) per annum, of the Maximum Drawing Amount from time to time outstanding of such Letter of Credit, payable for the ratable accounts of the Lenders in accordance with their respective Commitment Percentages plus (ii) one-eighth of one percent (.125%) per annum of the Maximum Drawing Amount from time to time outstanding of such Letter of Credit, payable for the sole account of the Agent as a fronting fee, and (b) on the date of issuance, and at the time of each extension, renewal, amendment, and transfer of each Letter of Credit and at such other time or times as such processing charges are customarily made by the Agent, the Agent's customary issuance, extension, renewal, amendment, transfer or similar processing fee as then are generally charged by the Agent in connection with similar letter of credit facilities to similar customers, payable to the Agent for its own account. If the Agent shall ever be obligated to refund to the Borrowers any amount of the Basic Letter of Credit Fees previously received from the Borrowers and distributed to any other Lender hereunder, such other Lender shall immediately upon demand repay such amounts to the Agent. For the purposes of this ss.4A.6, "Applicable Rate" shall mean the percentage rate per annum from time to time in effect that the Borrowers would pay with respect to Eurodollar Rate Loans as the applicable margin over the Eurodollar Rate as set forth in ss.2.4 of this Agreement. The foregoing Basic Letter of Credit Fee, being payable in arrears, shall not be payable with respect to periods for which the Basic Letter of Credit Fee has already been paid in advance pursuant to the provisions of this Agreement as in effect prior to the effectiveness of the Seventh Amendment hereto dated as of June 27, 1997." ss.1.7. Capitalized Leases. Section 10.1(f) of the Credit Agreement is hereby amended by deleting the figure "$10,000,000" and inserting in its place the figure "$19,000,000". ss.1.8. Guaranties. For the avoidance of doubt, the parties confirm that (notwithstanding anything to the contrary contained or implied in Section 3 of the Credit Agreement) all of the Obligations are guaranteed under, and entitled to the benefits of, each of the Guaranties, without regard to whether such Obligations arise with respect to any direct or indirect parent entity of the applicable Guarantors or otherwise. ss.2. Representations and Warranties. The Borrowers hereby represent and warrant to the Agent and the Lenders as follows: -5- (a) Representations and Warranties in Credit Agreement. Except as specified in writing by the Borrowers to the Agent with respect to the subject matter of this Amendment prior to the execution and delivery hereof by the Agent and the Lenders, the representations and warranties of the Borrowers contained in the Credit Agreement were true and correct in all material respects when made and continue to be true and correct in all material respects on the date hereof except, in each case to the extent of changes resulting from transactions contemplated or permitted by the Loan Documents and this Amendment and changes occurring in the ordinary course of business which singly or in the aggregate are not materially adverse, and to the extent that such representations and warranties relate expressly to an earlier date. (b) Authority, No Conflicts, Enforceability of Obligations, Etc. Each of the Borrowers hereby confirms that the representations and warranties of the Borrowers contained in ss.ss.6.l, 6.3 and 6.4 of the Credit Agreement are true and correct on and as of the date hereof as if made on the date hereof, treating this Amendment, the Credit Agreement as amended hereby, and the other Loan Documents as amended hereby, as "Loan Documents" for the purposes of making said representations and warranties. ss.3. Conditions to Effectiveness. The effectiveness of this Amendment shall be subject to the delivery to the Agent and the Lenders by (or on behalf of) each of the Borrowers or the Guarantors, as the case may be, contemporaneously with the execution hereof, of each of the following, each in form and substance satisfactory to the Agent and the Lenders: (a) this Amendment signed by each of the Borrowers, the Guarantors, the Agent, and the Lenders; (b) the Amended and Restated Fee Letter of even date herewith, signed by each of the Borrowers, the Guarantors, and the Agent; (c) an extension fee in the amount of $60,000 to be paid to the Agent for the pro rata accounts of the Lenders in accordance with each Lender's Total Percentage (as in effect immediately prior to the effectiveness of this Amendment); (d) an increase fee payable to Imperial Bank on the date hereof in the amount of $20,000; (e) certificates of an appropriate officer of each of the Borrowers and the Guarantors, dated as of the date hereof, as to (i) the corporate actions taken by each of the Borrowers and the Guarantors authorizing the execution, delivery, and performance hereof, and (ii) the names, titles, incumbency, and specimen signatures of the officers of each of the Borrowers and the Guarantors authorized to sign this Amendment on behalf of each of the Borrowers and the Guarantors; (f) a favorable written legal opinion addressed to the Agent and the Lenders, dated as of the date hereof, from Schulte, Roth & Zabel LLP, special counsel to the Borrowers and the Guarantors, with respect to such matters as the Agent or the Lenders may reasonably request; -6- (g) such evidence as the Agent may reasonably request such that the Agent shall be satisfied that the representations and warranties contained in ss.2 hereof are true and correct on and as of date hereof; (h) an executed Amended and Restated Revolving Credit Note in favor of each of FNBB and Imperial Bank substantially in the form of Exhibit A hereto, in the amounts of their respective Commitment Percentages of the Revolving Credit Commitment Amount, which amended and restated notes shall be hereafter deemed to constitute the Revolving Credit Notes referred to in the Credit Agreement; and (i) such other certificates, documents, or instruments with respect to this Amendment, the Borrowers, and the Guarantors as the Agent or the Lenders may reasonably request. ss.4. Certain Transitional Arrangements. Effective as of the date hereof, each Lender shall make such dispositions and arrangements with each other Lender with respect to the then outstanding Revolving Credit Loans (the "Adjustment") as shall result in the amount of Revolving Credit Loans owed to each Lender being equal to the product of such Lender's Commitment Percentage multiplied by the aggregate Revolving Credit Loans outstanding on the date hereof (the "Adjusted Amount"). The Borrowers and the Guarantors hereby agree that each Lender's Adjusted Amount shall be Revolving Credit Loans owed by the Borrowers jointly and severally to such Lender as if such Lender had initially made Revolving Credit Loans to the Borrowers in the amount of the Adjusted Amount. The Borrowers hereby also jointly and severally agree to pay all amounts referred to in ss.4.12 of the Credit Agreement arising in connection with the Adjustment (as if the Adjustment resulted in prepayments of the Revolving Credit Loans reallocated pursuant to the Adjustment). Upon the occurrence of the Adjustment, (a) the Agent shall appropriately adjust its records to reflect each Lender's Adjusted Amount and (b) each Lender shall promptly thereafter return to the Agent its Revolving Credit Note so replaced by an Amended and Restated Revolving Credit Note executed in connection with this Amendment. ss.5. No Other Amendments or Waivers; Execution in Counterparts. Except as otherwise expressly provided by this Amendment, all of the terms, conditions and provisions of the Credit Agreement and the other Loan Documents shall remain in full force and effect. Each of the Borrowers and the Guarantors confirms and agrees that the Obligations of the Borrowers to the Lenders under the Loan Documents, as amended and supplemented hereby, are secured by, guarantied under, and entitled to the benefits, of the Security Documents. The Borrowers, the Guarantors, the Agent and the Lenders hereby acknowledge and agree that all references to the Credit Agreement and the Obligations thereunder contained in any of the Loan Documents shall be references to the Credit Agreement and the Obligations, as amended hereby and as the same may be amended, modified, supplemented, or restated from time to time. The Security Documents and the perfected first priority security interests of the Lenders thereunder as collateral security for the Obligations shall continue in full force and effect, and the collateral security and guaranties provided for in the Security Documents shall not be impaired by this Amendment. This Amendment may be executed in any number of counterparts, but all such counterparts shall together constitute but one instrument. In making proof of this Amendment it shall not be necessary to produce or account for more than one counterpart signed by each party hereto by and against which enforcement hereof is sought. ss.6. Governing Law. This Amendment shall be construed according to and governed by the internal laws of the Commonwealth of Massachusetts without reference to principles of conflicts of law. -7- IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized The Borrowers: MORTON'S RESTAURANT GROUP, INC. PEASANT HOLDING CORP. MORTON'S OF CHICAGO, INC. By: /s/ Thomas J. Baldwin ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer BANKBOSTON, N.A. (formerly known as The First National Bank of Boston) for itself and as Agent By: /s/ Rod Guinn ------------------------------------- Name: Rod Guinn Title: Director IMPERIAL BANK By: ------------------------------------- Name: ---------------------------------- Title: ---------------------------------- HELLER FINANCIAL, INC. By: ------------------------------------- Name: ---------------------------------- Title: ---------------------------------- Consented and agreed to, by each of THE GUARANTORS (as defined in the Credit Agreement) By: /s/ Thomas J. Baldwin ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer for each of the Guarantors -7- IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized The Borrowers: MORTON'S RESTAURANT GROUP, INC. PEASANT HOLDING CORP. MORTON'S OF CHICAGO, INC. By: ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer BANKBOSTON, N.A. (formerly known as The First National Bank of Boston) for itself and as Agent By: ------------------------------------- Name: Rod Guinn Title: Director IMPERIAL BANK By: /s/ Dianne H. Russell ------------------------------------- Name: Dianne H. Russell Title: Senior Vice President HELLER FINANCIAL, INC. By: ------------------------------------- Name: ---------------------------------- Title: ---------------------------------- Consented and agreed to, by each of THE GUARANTORS (as defined in the Credit Agreement) By: ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer for each of the Guarantors -7- IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized The Borrowers: MORTON'S RESTAURANT GROUP, INC. PEASANT HOLDING CORP. MORTON'S OF CHICAGO, INC. By: ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer BANKBOSTON, N.A. (formerly known as The First National Bank of Boston) for itself and as Agent By: ------------------------------------- Name: Rod Guinn Title: Director IMPERIAL BANK By: ------------------------------------- Name: ---------------------------------- Title: ---------------------------------- HELLER FINANCIAL, INC. By: /s/ Bruce Westwood-Booth ------------------------------------- Name: Bruce Westwood-Booth ---------------------------------- Title: Senior Vice President ---------------------------------- Consented and agreed to, by each of THE GUARANTORS (as defined in the Credit Agreement) By: ------------------------------------- Name: Thomas J. Baldwin Title: Executive Vice President and Chief Financial Officer for each of the Guarantors EX-27 3 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the June 29, 1997 Form 10-Q and is qualified in its entirety by reference to such financial statements. 1000 6-MOS DEC-28-1997 DEC-30-1996 JUN-29-1997 2,534 0 2,114 0 4,642 16,532 32,772 5,345 69,350 16,102 21,970 0 0 65 25,136 69,350 87,595 87,595 30,171 72,264 8,974 0 1,209 5,148 1,287 3,861 0 0 0 3,861 0.56 0.56 Current assets inclued $371 of Assets Held for Sale. Current liabilities include $3,352 of Liabilities related to assets held for sale.
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