Einstein Noah announces $4 special dividend

Dec. 7, 2012

Einstein Noah Restaurant Group Inc., parent company of Einstein Bros. Bagels, Noah's New York Bagels and Manhattan Bagel brands, announced that its board of directors has completed its comprehensive strategic alternatives review process to maximize shareholder value by recapitalizing the company and declaring a one-time special dividend to shareholders of $4 per share.

Piper Jaffray served as the company's financial advisor and Bryan Cave HRO served as the company's legal advisor in connection with the review of strategic alternatives.

The recapitalization includes the amendment and restatement of the company's existing senior credit facility, which consists of a Term Loan A and a Revolver with a syndicate of banks. The amendment and restatement of the facility increases the company's Term Loan A from $75 million to $100 million, increases the Revolver from $50 million to $75 million, and extends the maturity date from Dec. 20, 2015, to Dec. 6, 2017. The increase to $175 million will be used to fund the one-time special dividend, the ongoing quarterly dividend, working capital, capital expenditures and other general corporate purposes.

The loans under the facility will bear interest equal to the Eurodollar Rate plus an applicable margin ranging from 2.5 to 4.0 percent, or the Base Rate plus an applicable margin ranging from 1.5 to 3.0 percent.

The one-time special dividend of $4 per share is payable on Dec. 27, 2012, to shareholders of record at the close of business on Dec. 7, 2012, and will have an ex-dividend date of Dec. 28, 2012. This is in addition to the previously disclosed company's regular quarterly dividend of $0.125 per share.

The total cash outlay for the one-time special dividend will be approximately $68 million. Immediately following the payment of the special dividend, the company expects the outstanding principal balance under the facility to be approximately $140 million, comprised of $100 million under the Term Loan A and approximately $40 million under the Revolver.

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