BLIMPIE INTERNATIONAL, INC., REACHES AGREEMENT
TO SELL COMPANY TO PRIVATE INVESTOR GROUP
NEW YORK, October 8, 2001 - Blimpie International, Inc. (Amex: BLM) and a
private investor group have signed a definitive agreement under which the
investor group would purchase all outstanding shares of the company's common
stock. The investor group is headed by Xxxxxxx Xxxxxxxxx, a Blimpie
subfranchisor with extensive experience in the organization.
The agreement calls for the investor group to purchase all of the
outstanding shares of Blimpie for a cash purchase price of $2.80 per share.
There are approximately 9.2 million shares of Blimpie common stock outstanding.
In connection with the agreement, various members of management who currently
own approximately 58% of the outstanding shares of Blimpie have agreed to vote
their shares in favor of the agreement. Additionally, the agreement provides
that Blimpie will have the ability to conduct a market check for a 30-day
period. The agreement also allows Blimpie to terminate the agreement if the
Board determines that it has received an offer that it believes is more
favorable to all of its shareholders from a financial point of view, which would
require the payment by Blimpie of a break-up fee of $1.3 million plus up to
$200,000 of expenses.
"Our Board of Directors evaluated this offer carefully to ensure that our
shareholders are getting the best deal possible," said Xxxx Xxxxx, chairman and
chief executive officer of Blimpie. "We believe that this agreement is in the
best interests of Blimpie shareholders, employees, franchisees and
subfranchisors."
"The investor group is committed to nurturing and growing the Blimpie
brand, and I'm confident they will bring new ideas, energy and enthusiasm to the
Company," said Xxxxx. Xx. Xxxxx also is part of the investor group and will
remain with Blimpie as chairman emeritus.
Blimpie engaged Capitalink, L.C., an investment banking firm, as the
company's financial advisor in connection with the transaction to render a
fairness opinion to Xxxxxxx's Board of Directors.
Consummation of the transaction is contingent upon a number of conditions,
including the approval of Blimpie shareholders.
Blimpie International is a global franchisor of several branded
quick-service restaurant concepts. The company's core brand, BLIMPIE(R) Subs &
Salads, has grown to approximately 2,000 franchised outlets across the United
States and 15 foreign countries.
This press release is being filed pursuant to Rule 425 under the
Securities Act of 1933 and is deemed filed pursuant to Rule 14a-12 under the
Securities Exchange Act of 1934.
Blimpie will file a proxy statement and other relevant documents
concerning the proposed merger transaction with the SEC. Investors are urged to
read the proxy statement when it becomes available and any other relevant
documents filed with the SEC because they will contain important information on
the proposed transaction. You will be able to obtain the documents filed with
the SEC free of charge at the Web site maintained by the SEC at xxx.xxx.xxx. In
addition, you may obtain documents filed with the SEC by Blimpie free of charge
by requesting them in writing from Blimpie, 1775 The Exchange, Atlanta, GA,
30309 Attention: Investor Relations, or by telephone at (000) 000-0000 Ext. 165.
Blimpie, its employee directors and executive officers may be deemed to be
participants in the solicitation of proxies from Xxxxxxx's shareholders. A list
of the names of those directors and executive officers and descriptions of their
interests in Blimpie is contained in Blimpie's proxy statement dated November
10, 2000, which is filed with the SEC. Stockholders may obtain additional
information about the interests of those directors and executive officers in
this transaction by reading the proxy statement when it becomes available.
The matters set forth in this press release contain forward
looking-statements as defined under the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. The forward-looking statements involve
known and unknown risks and uncertainties. Actual results may differ materially
from those expected in the forward-look statements made by Blimpie. Please refer
to Xxxxxxx's filings with the Securities and Exchange Commission for additional
information.
For further information, please contact: Xx. Xxx Xxxx, Director of
Public Relations at Blimpie
Tel. No. 000-000-0000, Ext. 165
