all: the one that got away -- KKRO is a discounted convert I was never able to borrow
when it was > $5. It is now trading at about $1 1/4.
The co. issued a news release today that acknowledges that conversions of the discounted convert is killing the stock price.
This an example of what a discounted convert financing can do to the stock of a lousy company.
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LOS ANGELES, Jan. 28 /PRNewswire/ -- Koo Koo Roo, Inc. (NASDAQ:KKRO)
released the following statement in response to numerous shareholder and media
inquiries related to the recent heavy trading volume in its stock, downward
price pressure, and the high level of conversions of its outstanding
adjustable convertible preferred stock:
Ken Berg, Chairman of the Board, said, "We want to assure our shareholders
that Koo Koo Roo is continuing to conduct its business in accordance with its
growth strategy for the Koo Koo Roo restaurant operations. Same store sales
improved during the fourth quarter and are up again in January over the prior
periods. As previously announced, we opened our 37th restaurant on December
31st and now have eight stores in permitting and development, plus another
three under construction. We are continuing to build stores in our
established core markets with a special emphasis on opening additional units
in Southern California. At December 31st we also had on hand cash and
marketable securities of approximately $10 million."
Consistent with this strategy, the Company also recently decided to close
its two Koo Koo Roo locations in the Washington, D.C. area, although it will
continue to operate the very successful location at Washington National
Airport.
Although there can be no assurance that these discussions will lead to a
transaction, the Company announced it is in preliminary discussions with
Cappello Capital Corp. regarding restructuring alternatives with respect to
the conversion of its existing adjustable convertible preferred stock.
Statements contained in this press release which are not historical facts
are forward looking statements as that item is defined in the Private
Securities Litigation Reform Act of 1995. Such statements relating to, among
other things, the prospects for the Company to sign additional leases, sell
franchises and enhance operating results, are necessarily subject to risks and
uncertainties, some of which are significant in scope and nature, including
risks associated to real estate, construction, competition, availability of
capital, and continuation of sales increases.
These risks are further discussed with the Securities and Exchange
Commission (SEC) including a report on Form 10-Q filed with the SEC for the
quarter ended September 30, 1997.
SOURCE Koo Koo Roo, Inc.
-0- 01/28/98
/CONTACT: Jeff Lloyd or Steve Hawkins, 310-788-2850 or Cynthia Bond,
212-755-2850, all of Sitrick and Company; Ronald D. Garber, General Counsel,
Koo Koo Roo, Inc., 310-479-2080/ |
