Good news for Louis Habash, for the rest of us I am not so sure.... Personally I think the deal stinks for us shareholders. ASSI is controlled by Louis Habash the same guy opposed to gambling, yea right unless the price is right....Where can I turn in my worthless warrants for .80 cents a share?? That 2 buck offer is looking better all the time. Hope I am wrong about this deal, but after reading it, doesn't look to me at least in the short term.
Opinions?
Rory
Chicago Pizza Announces Agreement
With Strategic Investor
MISSION VIEJO, Calif.--(BUSINESS WIRE)--Feb. 19, 1999--Chicago Pizza & Brewery Inc.
(Nasdaq: CHGO - news and CHGOW - news) Friday announced that it had entered into an
agreement with a strategic investor that involves the sale of company common stock, cancellation of
warrants and existing consulting agreements between the company and the investor, and a conditional
agreement regarding the guarantee of direct funding by the investor or its affiliates of future financing.
Pursuant to the terms of a stock purchase agreement among the company, ASSI Inc., a Nevada
corporation, and the sole stockholder of ASSI, the company will issue 1.25 million shares of its
common stock to ASSI in exchange for a cash payment of $1 million, the termination of two
consulting agreements between Chicago Pizza and ASSI, and cancellation of 3.2 million of the
company's redeemable warrants held by ASSI. Such warrants comprised over 25 percent of the
company's outstanding redeemable warrants.
As an additional part of the consideration for the common stock, ASSI and its sole shareholder also
agreed to finance or guarantee financing of unspecified future development projects of the company,
subject to project pre-commitment approval, and agreed to cooperate in connection with any gaming
or licensing applications or proceedings involving Chicago Pizza.
ASSI also granted Chicago Pizza an assignable right of first refusal to purchase the shares of
common stock in the event that ASSI desires to sell such shares. As a result of the transaction, ASSI
will own approximately 16.3 percent of the 7,658,321 shares of common stock outstanding upon
completion of the transaction.
Paul Motenko, chief executive officer of Chicago Pizza & Brewery, stated that, ''The agreement
provides $1 million in additional capital to finance the company's continued growth. In addition, we
believe that ASSI and its affiliates' experience in real estate development and the hospitality industries
will prove to be a valuable resource as the company expands.''
ASSI and affiliates have extensive ownership and development experience in the real estate and
hospitality industries, having developed and/or managed restaurant, hotel and other properties in a
number of markets the company is in or has under consideration, Motenko said.
In connection with its investment, ASSI received certain demand and piggyback registration rights as
well as a commitment from the company to use its best efforts to have two of the company's
directors be persons designated by ASSI and to cause each of such designees to be included in the
slate of director nominees for election at each annual meeting of shareholders over the next three
years.
ASSI also received a commitment from Motenko and Jeremiah Hennessy, the company's principal
executive officers, to vote their shares of common stock in favor of ASSI's board nominees in certain
circumstances. Such rights terminate at such time as ASSI and its affiliates no longer own at least 5
percent of the company's outstanding common stock.
Chicago Pizza & Brewery owns 28 BJ's and Pietro's restaurants in Arcadia, Brea, Balboa,
Huntington Beach, Laguna Beach, Seal Beach, La Jolla, Belmont Shore and Westwood, Calif.; in
Boulder, Colo.; and Lahaina, Hawaii. Seventeen BJ's and Pietro's restaurants are located in Oregon
and Washington.
The information presented herein contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, which are intended to be converted by the
safe harbors created thereby. The company's results may differ significantly from the results indicated
by such forward-looking statements. Factors that might cause such differences include, but are not
limited to: (1) the company's ability to finance or fund its business plan, (2) the company's ability to
manage growth and conversions, (3) construction delays, (4) restaurant and brewery industry
competition and other such industry considerations, (5) marketing and other limitations based on the
company's historic concentration in Southern California and current concentration in the Northwest,
(6) consumer trends, (7) increased food costs and wages, including without limitation, the recent
increase in the minimum wage, and (8) other general economic and regulatory conditions.
Contact:
Chicago Pizza & Brewery Inc., Mission Viego
Paul Motenko, 949/367-8616
More Quotes and News:
Chicago Pizza & Brewery Inc (Nasdaq:CHGOW - news;
Nasdaq:CHGO - news)
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