News

Cosi announces planned rights offering

April 12, 2012

Cosi, Inc. has announced that it has filed a registration statement with the Securities and Exchange Commission for a rights offering to its existing shareholders. The company plans to make the rights offering through the distribution of non-transferable subscription rights to purchase shares of the company's common stock at a subscription price to be determined and subject to an aggregate ownership limitation equal to 19.9 percent of the company's common stock.

Assuming the rights offering is fully subscribed, the company currently expects to receive gross proceeds of approximately $15.0 million. The company is planning to commence a rights offering in order to raise equity capital in a timely and cost-effective manner, while providing all of Cosi's shareholders the opportunity to participate.

The proposed rights offering also will include an over-subscription privilege, which will entitle each rights holder to purchase additional shares of common stock that remain unsubscribed at the expiration of the rights offering, subject to the availability and pro rata allocation of shares among persons exercising this over-subscription right.

In conjunction with the rights offering, all of the company's executive officers and outside directors have agreed to purchase shares that are subject to their basic subscription privilege, at the same subscription price offered to shareholders. Also, five of its executive officers and outside directors have agreed to purchase, at the same subscription price offered to shareholders, shares that would otherwise be available for purchase by them pursuant to the exercise of their over-subscription privileges. The total amount of commitments by the directors and executive officers is $1.6 million.

"We intend to use the proceeds from this offering for planned growth as well as general corporate purposes, including initiatives to increase traffic in our stores," said Carin Stutz, Cosi president and CEO.

A registration statement relating to these securities has been filed with the SEC but has not yet become effective. Additionally, the rights will be issued to all shareholders as of a record date which has yet to be determined. The subscription price also has yet to be determined. The company will provide notice of the record date and subscription price in the future at such time as they are determined.