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Non-Tech : RAINFOREST CAFE

RAIN 5.920

-3.6%

1:52 PM EST

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To: Lee L. who wrote (4610)	5/23/1999 2:45:00 PM
From: Dennis Vail	of 4704

Lee, Well, I haven't been following RAIN all that closely lately but I still think the concept is outstanding. We were at the Gurnee unit this March because our kids begged us to take them and they've already been to the units at least a score of times, as have my wife and myself. All of us continue to enjoy the experience. Food and service was excellent as has been the case in the majority of our visits. So in my mind its certainly not the concept that's the problem. Management however is another matter: Unsuccessfully trying to sneak an offering in when the SSS first started seriously heading south in 4Q of '97, preannouncing they were comfortable with earning that Q then a few weeks later announcing they weren't. The year long search for a new President that ended with a whimper named Brimmer. The ill conceived put sales that must have lost millions by now. Repricing the stock options for management not once but twice during the last year and a half so while the stock diminished 80% the strike price for management diminshed accordingly. Hard to believe these guys have the shareholders interest at heart. And as that old saw goes "you seldom see just one cockroach", so I've my doubts we've seen our last here. The most worrisome being just when RAIN is about to turn it the possiblity of Lyle finagling a way to pull off a buyout to take the company private and ensue long suffering shareholders the bare minimum of reward for their patience......No, I don't trust these guys. If they really want to promote trust its as easy as hiring a respected restaurant exec as President/COO and give him full reign with the company. Morever, seems to me there has been an enormous growth in restaurants of all varieties these last few years and over time the strong concepts like RAIN will abide while the weak ones like Planet Hollywood will fall to the wayside. But that could take quite a while, and in the meantime there are an awful lot of hogs at the same feeding trowl. Finally these points aside I still feel that the SSS at the older units should flatten out soon and when that happens the shareprice will double in a hurry because when its all said and done RAIN is way, way underpriced. Warm regards, Dennis

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