EACO Corporation Announces Completion of Asset Sale to Banner Buffets
EACO Corporation announced that it has completed the previously announced sale of all its operating restaurants to Banner Buffets LLC.
The transaction was approved by a majority of the Company's shareholders on May 25, 2005.
As a result of the transaction, the Company has transferred substantially all of its business assets to Banner Buffet. In consideration of the assets, Banner Buffets paid $25,950,000 in cash and a promissory note in the amount of $4 million. Net cash proceeds to the Company totaled approximately $13,170,000 before payment of certain closing expenses.
Prior to the closing of the transaction, a broker made a claim to $3.5 million of the proceeds of the transaction as a commission. To avoid delaying the closing, the Company has agreed to place $400,000 of the proceeds received at closing in escrow pending final resolution of the broker's claim. The Company denies that it has any commission agreement with such broker and intends to seek a rapid resolution of this claim.
Glen Ceiley, Chairman of the Board of the Company, stated: "We are extremely pleased to have been able to complete this transaction with Banner Buffets and are excited to begin exploring new opportunities for the Company."
The Company plans on remaining a public company and is now in the process of developing a new business plan pursuant to which it will invest the proceeds from this transaction. The Company stated that it does not anticipate making any distributions to its shareholders as a result of the completion of this transaction.
EACO Corporation (formerly known as Family Steak Houses of Florida, Inc.) is a Florida corporation which, prior to the completion of this transaction, operated 16 restaurants in the State of Florida under the names of "Ryan's," "Whistle Junction," and "Florida Buffet." As a result of the sale to Banner Buffets, the Company has conveyed substantially all of its ongoing restaurant assets to Banner Buffets but will still own two restaurant properties which are leased to other restaurant operators as well as two properties which the Company leases and then subleases to others for restaurant operations.
As a result of the transaction, the Company has transferred substantially all of its business assets to Banner Buffet. In consideration of the assets, Banner Buffets paid $25,950,000 in cash and a promissory note in the amount of $4 million. Net cash proceeds to the Company totaled approximately $13,170,000 before payment of certain closing expenses.
Prior to the closing of the transaction, a broker made a claim to $3.5 million of the proceeds of the transaction as a commission. To avoid delaying the closing, the Company has agreed to place $400,000 of the proceeds received at closing in escrow pending final resolution of the broker's claim. The Company denies that it has any commission agreement with such broker and intends to seek a rapid resolution of this claim.
Glen Ceiley, Chairman of the Board of the Company, stated: "We are extremely pleased to have been able to complete this transaction with Banner Buffets and are excited to begin exploring new opportunities for the Company."
The Company plans on remaining a public company and is now in the process of developing a new business plan pursuant to which it will invest the proceeds from this transaction. The Company stated that it does not anticipate making any distributions to its shareholders as a result of the completion of this transaction.
EACO Corporation (formerly known as Family Steak Houses of Florida, Inc.) is a Florida corporation which, prior to the completion of this transaction, operated 16 restaurants in the State of Florida under the names of "Ryan's," "Whistle Junction," and "Florida Buffet." As a result of the sale to Banner Buffets, the Company has conveyed substantially all of its ongoing restaurant assets to Banner Buffets but will still own two restaurant properties which are leased to other restaurant operators as well as two properties which the Company leases and then subleases to others for restaurant operations.
