Form 8-K BOB EVANS FARMS INC For: Oct 19

 

 

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): October 23, 2015 (October 19, 2015)

 

 

Bob Evans Farms, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		0-1667		31-4421866
(State or other jurisdiction of incorporation)		(Commission File No.)		(I.R.S. Employer Identification No.)

 

8111 Smith’s Mill Road, New Albany, Ohio		43054
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (614) 491-2225

Not applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2b)

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)

 

 

 

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Item 1.01 Entry into a Material Definitive Agreement.

On October 19, 2015, BEF Foods, Inc., an Ohio corporation and a wholly owned indirect subsidiary of Bob Evans Farms, Inc., a Delaware corporation (“BEF Foods” or the “Company”) and Broadstone Net Lease Acquisitions, LLC, a New York limited liability company (“Broadstone”) entered into a Purchase and Sale Agreement pursuant to which BEF Foods agreed to sell, and Broadstone agreed to purchase, the real estate associated with two of the Company’s manufacturing facilities, located at: (1) 651 Commerce Parkway, Lima, Ohio (“Lima Ohio Plant”); and (2) 1109 E. Industria1 Drive, Sulphur Springs, Texas (“Sulfur Springs Texas Plant”). The purchase price paid by Broadstone to BEF Foods at closing for the two properties was $51.6 million. Broadstone is a private real estate investment trust managed by Broadstone Real Estate, LLC.

On October 23, 2015, BEF Foods and Broadstone closed on the Purchase and Sale Agreement and also entered into an absolute net master lease (“Lease Agreement”) pursuant to which Bob Evans leased both the Lima Ohio Plant and the Sulphur Springs Texas Plant Property for an initial term of 20-years, at an annual straight-line rent expense of $4.1 million, inclusive of a $2.3 million deferred gain amortized throughout the lease term. There are two ten year renewal options. The Lease Agreement contains “triple net” terms, which means that BEF Foods will remain responsible for all expenses associated with the properties, including but not limited to maintenance, property taxes, insurance, and facilities expense.

Also on October 23, 2015, Bob Evans Farms, Inc., a Delaware corporation (“Bob Evans”) and Bob Evans Farms, LLC, an Ohio limited liability company, a wholly owned subsidiary, entered into payment and performance guaranties of the Lease Agreement to benefit Broadstone (“Lease Guaranties”). Bob Evans expects to use the net proceeds from the sale transactions to pay down debt and to repurchase shares, while maintaining a prudent adjusted leverage level.

Item 2.01 Completion of Acquisition or Disposition of Assets.

The disclosure in Item 1.01 above is incorporated herein by reference.

Item 8.01. Other Events.

On October 23, 2015, Bob Evans issued a press release announcing the entering into and closing of the sale-leaseback transaction discussed under Item 2.01. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

Item 9.01.

Financial Statements and Exhibits.

 

(d)

Exhibits

 

99.1

Press Release dated October 23, 2015

 

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SIGNATURE

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.

 

				BOB EVANS FARMS, INC.
Date: October 23, 2015						By:		/s/ Kevin C. O’Neil
						Kevin C. O’Neil, Vice President, Assoc. General Counsel and Asst. Corporate Secretary

 

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Exhibit 99.1

 

Bob Evans Farms Completes $51.6 Million Sale-Leaseback Transaction of Two Industrial Properties and $44.4 Million of Q2 Fiscal 2016 Share Repurchases

NEW ALBANY, Ohio – October 23, 2015 – Bob Evans Farms, Inc. (NASDAQ: BOBE) today announced it completed a sale-leaseback transaction of its BEF Foods industrial properties located in Lima, Ohio, and Sulphur Springs, Texas.

BEF Foods, Inc., a wholly-owned subsidiary of Bob Evans Farms, Inc., and Broadstone Net Lease Acquisitions, LLC (“BNL”), a private real estate investment trust managed by Broadstone Real Estate, LLC., entered into an agreement pursuant to which BEF Foods sold its industrial properties located in Lima, Ohio, and Sulphur Springs, Texas, to BNL for $51.6 million. Net transaction proceeds are estimated at $50.0 million, with an estimated after-tax loss of $2.5 million, or $0.11 per diluted share.

BEF Foods and BNL also entered into a lease agreement pursuant to which BEF Foods leased both the Lima, Ohio, manufacturing facility and the Sulphur Springs, Texas, manufacturing facility for an initial 20-year term at an annual straight-line rent expense of $4.1 million, inclusive of a $2.3 million deferred gain amortized throughout the lease term. There are two ten-year renewal options. The lease agreement contains “triple net” terms, which means BEF Foods will remain responsible for all expenses associated with the properties, including but not limited to maintenance, property taxes, insurance, and facility expenses. Bob Evans Farms, Inc. and Bob Evans Farms, LLC, have also guaranteed the lease agreement.

Chief Administrative Officer and Chief Financial Officer Mark Hood said, “With this transaction now complete, we continue to pursue monetization of our corporate headquarters facility along with approximately $200 million of restaurant properties. We expect to utilize the net proceeds from these asset monetization transactions to pay down debt and to repurchase shares, while maintaining prudent leverage. During the second quarter, we repurchased $44.4 million of shares, bringing fiscal year-to-date share repurchase activity to $104.9 million. We expect to complete the remainder of the current $150 million share repurchase authorization during the balance of fiscal 2016.”

Information concerning this transaction was filed by the Company today with the Securities and Exchange Commission and can be obtained at www.sec.gov.

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Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Certain statements in this news release that are not historical facts are forward-looking statements. Forward-looking statements involve various important assumptions, risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events. We discuss these factors and events, along with certain other risks, uncertainties and assumptions, under the heading “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended April 24, 2015, and in our other filings with the Securities and Exchange Commission. We note these factors for investors as contemplated by the Private Securities Litigation Reform Act of 1995. Predicting or identifying all such risk factors is impossible. Consequently, investors should not consider any such list to be a complete set of all potential risks and uncertainties. Any strategic transaction with respect to our headquarters, our BEF Foods Facilities or a portion of our restaurant real estate remains subject to evaluation by the Board and there can be no assurance if and when any such transaction will be undertaken or consummated. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update any forward-looking statement to reflect circumstances or events that occur after the date of the statement to reflect unanticipated events. All subsequent written and oral forward-looking statements attributable to us or any person acting on behalf of the Company are qualified by the cautionary statements in this section.

About Bob Evans Farms, Inc.

Bob Evans Farms, Inc. owns and operates full-service restaurants under the Bob Evans Restaurants brand name. At the end of the first fiscal quarter (July 24, 2015), Bob Evans Restaurants owned and operated 549 family restaurants in 19 states, primarily in the Midwest, mid-Atlantic and Southeast regions of the United States. Bob Evans Farms, Inc., through its BEF Foods segment, is also a leading producer and distributor of refrigerated side dishes, pork sausage and a variety of refrigerated and frozen convenience food items under the Bob Evans and Owens brand names. For more information about Bob Evans Farms, Inc., visit www.bobevans.com

Contact:

Scott C. Taggart

Vice President, Investor Relations

(614) 492-4954

BOBE-G

 

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