Così, Inc. Completes Issuance of $5,000,000 Senior Secured Promissory Note
April 14 2014 - 05:10PM
CONTACT: William
Koziel
(847)
597-8803
Così, Inc.
Completes Issuance of $5,000,000 Senior Secured Promissory
Note
DEERFIELD, IL - April 14, 2014 -
Così, Inc. (NASDAQ: COSI), the fast casual restaurant company,
today announced that it has entered into a Senior Secured
Promissory Note Purchase Agreement ("Note Purchase Agreement") with
Milfam II L.P. pursuant to which the Company sold a $5.0 million
Senior Secured Promissory Note (the "Note") to Milfam II L.P.
Interest will accrue on the principal amount of the Note at the
rate of 9%, compounded semi-annually, and will be paid in arrears
semi-annually. The Company may elect to pay the first two
interest payments in kind at 11%. The Note is payable in full
on the third anniversary from the effective date of issue.
The Note is senior to all other obligations of the Company and
secured by all assets of the Company and its currently-owned
subsidiaries.
As consideration for the Note
Purchase Agreement, the Company paid Milfam II L.P. a fee of 3.5%
of the amount of the Note as well as providing a warrant
exercisable to purchase up to 1.1 million shares of the Company's
common stock at an exercise price per share of $0.01. The
warrant is exercisable to the extent that doing so does not result
in the Milfam II L.P. and any related parties, in the aggregate,
owning more than 19.9% of the Company's common stock.
Mr. Lloyd I. Miller, III, is the
manager of Milfam LLC, which is the general partner of Milfam II
L.P. Mr. Miller is also a significant shareholder of the
Company.
The Company also announced that
Mr. Karl Okamoto today resigned from the Board of Directors of the
Company (the "Board"). Mr. Okamoto's notification to the
Board did not indicate that he was resigning due to any
disagreement with the Company on any matter relating to its
operations, policies or practices. Stephen Edwards, Executive
Chairman, stated, "I would like to thank Karl Okamoto both
personally and on behalf of all shareholders for his service to
Così. During his tenure, Mr. Okamoto provided the board with
strong leadership in many areas ranging from corporate governance
to strategic initiatives. We have benefitted from his
thoughtful and pragmatic advice."
Mr. Patrick Bennett was today
appointed to serve on the Board of Directors. At the
recommendation of its Nominating and Corporate Governance
Committee, the Board elected Mr. Bennett to fill the vacancy
created by Mr. Okamoto's resignation and to serve as a director of
the Company for the remainder of Mr. Okamoto's term, or until his
successor is duly elected and qualified. "We want to welcome
Mr. Bennett as our newest member of the Così Board of
Directors. He brings a breadth of experience in navigating
high potential companies through transitional periods," stated
Stephen Edwards, Executive Chairman. Mr. Bennett was proposed
for election by Milfam II L.P. pursuant to the terms of the Note
Purchase Agreement. In accordance with the Note Purchase
Agreement, until the Company has paid all financial obligations
arising under the loan documents in full, the Nominating and
Corporate Governance Committee of the Company shall nominate and
recommend Mr. Bennett for re-election to the Board at each meeting
of the stockholders of the Company at which he is eligible for
re-election after the expiration of his initial term.
About Così, Inc.
Così®
(http://www.getcosi.com) is a national fast casual restaurant chain
that has developed featured foods built around a secret,
generations-old recipe for crackly crust flatbread. This artisan
bread is freshly baked in front of customers throughout the day in
open-flame stone-hearth ovens prominently located in each of the
restaurants. Così's warm and urbane atmosphere is geared towards
its sophisticated, upscale, urban and suburban guests. There are
currently 72 Company-owned and 49 franchise restaurants operating
in sixteen states, the District of Columbia, Costa Rica and the
United Arab Emirates. The Così® vision is to
become America's favorite fast casual restaurant by providing
customers authentic, innovative, savory food while remaining an
affordable luxury.
The Così® menu features
Così® sandwiches,
freshly-tossed salads, bowls, breakfast wraps, melts, soups,
Così®
Squagels®, flatbread
pizzas, S'mores, snacks and other desserts, and a wide range of
coffee and coffee-based drinks and other specialty beverages.
Così® restaurants
are designed to be a welcoming and comfortable environment. Così's
sights, sounds, and spaces create a tasteful, relaxed ambience that
provides a fresh and new dining experience.
"Così," "(Sun & Moon Design)"
and related marks are registered trademarks of Così, Inc. in the
U.S.A. and certain other countries. Copyright © 2014 Così, Inc. All
rights reserved.
"SAFE HARBOR" STATEMENT UNDER THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. This press
release contains statements that constitute forward- looking
statements under the federal securities laws. Forward-looking
statements are statements about future events and expectations and
not statements of historical fact. The words "believe," "may,"
"will," "should," "anticipate," "estimate," "expect," "intend,"
"objective," "seek," "plan," "strive," or similar words, or
negatives of these words, identify forward- looking statements. We
qualify any forward-looking statements entirely by these cautionary
factors. Forward-looking statements are based on management's
beliefs, assumptions and expectations of our future economic
performance, taking into account the information currently
available to management. Forward-looking statements involve risks
and uncertainties that may cause our actual results, performance or
financial condition to differ materially from the expectations of
future results, performance or financial condition we express or
imply in any forward-looking statements. Factors that could
contribute to these differences include, but are not limited to:
the results being reported in this release are unaudited and
subject to change; the cost of our principal food products and
supply and delivery shortages and interruptions; labor shortages or
increased labor costs; changes in demographic trends and consumer
tastes and preferences, including changes resulting from concerns
over nutritional or safety aspects of beef, poultry, produce, or
other foods or the effects of food-borne illnesses, such as E.
coli, "mad cow disease" and avian influenza or "bird flu";
competition in our markets, both in our business and in locating
suitable restaurant sites; our operation and execution in new and
existing markets; expansion into new markets including foreign
markets; our ability to attract and retain qualified franchisees
and our franchisees' ability to open restaurants on a timely basis;
our ability to locate suitable restaurant sites in new and existing
markets and negotiate acceptable lease terms; the rate of our
internal growth and our ability to generate increased revenue from
our existing restaurants; our ability to generate positive cash
flow from existing and new restaurants; fluctuations in our
quarterly results due to seasonality; increased government
regulation and our ability to secure required government approvals
and permits; our ability to create customer awareness of our
restaurants in new markets; the reliability of our customer and
market studies; cost effective and timely planning, design and
build out of restaurants; our ability to recruit, train and retain
qualified corporate and restaurant personnel and management; market
saturation due to new restaurant openings; inadequate protection of
our intellectual property; our ability to obtain additional capital
and financing; adverse weather conditions which impact customer
traffic at our restaurants; and adverse economic conditions.
Further information regarding factors that could affect our results
and the statements made herein are included in our filings with the
Securities and Exchange Commission.
Additional information is available
on Così's website at
http://www.getcosi.com in the investor relations section.
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Così, Inc via Globenewswire
HUG#1777377