As filed with the Securities and Exchange Commission on April 26,
2004.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
April 12, 2004
Shells Seafood Restaurants, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-28258 65-0427966
(State or other jurisdiction (Commission file number) (IRS employer
of incorporation) identification No.)
16313 N. Dale Mabry Hwy, Ste 100, Tampa, FL 33618
(Address of principal executive offices)
Registrant's telephone number, including area code:
(813) 961-0944
Not Applicable
(Former name or former address, if changed since last report)
Item 1. Changes in Control of Registrant
The Company has been notified that on April 12, 2004, Frederick R.
Adler purchased the $1,000,000 promissory note issued by the
Company to Banyon Investments, LLC ("Banyon") on January 31, 2002
as part of the Company's $2,000,000 financing; and that the note
was purchased with the personal funds of Mr. Adler.
In January 2002, we raised $2,000,000 in a private financing
transaction, consisting of secured promissory notes and warrants
to purchase Common Stock. The two investors in the financing
transaction were Shells Investment Partners, L.L.C. ("SIP") and
Banyon. Banyon is an entity associated with Philip R. Chapman,
Chairman of our Board of Directors, and certain family members of
Frederick R. Adler, a greater than 10% stockholder.
In January 2002, in connection with the $2 million financing
transaction, we issued to each of SIP and Banyon (i) a $1 million
secured promissory note due January 31, 2005 which bears interest
at 15% per annum, of which 8% is payable monthly in arrears and 7%
is deferred and payable when the principal is payable in full, and
(ii) a warrant to purchase 4,454,015 shares of Common Stock at an
exercise price of $0.16 per share. The warrants are exercisable
through January 31, 2005. Banyon has retained the rights with
respect to these warrants. Based on filings made with the
Securities and Exchange Commission, Mr. Adler beneficially owns
25.8% of our common stock, excluding the warrant to purchase
4,454,015 shares held by Banyon. Mr. Adler's wife is a co-
managing member of Banyon. The Company has 10,757,000 shares
outstanding on a fully diluted basis and 9,092,000 shares
outstanding assuming conversion of only the warrant to Banyon.
In January 2002, in connection with the $2 million financing
transaction, we entered into an Investor Rights Agreement with
SIP, Banyon and certain other stockholders. The Investor Rights
Agreement fixes the composition of the Board at seven members,
subject to certain requirements, and provided each of Banyon and
SIP with the right to nominate three individuals to serve on the
Board. Banyon's right to nominate three individuals to serve on
the Board has been transferred to Mr. Adler in conjunction with
the purchase by Mr. Adler of the $1,000,000 note on April 12,
2004. The Company has not been notified of any plans by Mr. Adler
to change any board nominee.
Item 7. Financial Statements and Exhibits
(c) Exhibits
10.01 Secured Senior Note in the aggregate principal
amount of $1,000,000 issued to Frederick R. Adler
dated April 12, 2004
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 hereunto duly authorized.
Dated: April 26, 2004 SHELLS SEAFOOD RESTAURANTS, INC.
By: /s/ Warren R. Nelson
Warren R. Nelson
Executive Vice President
Chief Financial Officer