Shareholders Go KoKo For Franchise Dividend
Posted on: 18/08/2006
Franchise Capital Corporation shareholders to receive share dividend from sale of Kokopelli Franchise Company, LLC.
The Board of Directors of Franchise Capital Corporation today announced that the company has entered into a purchase agreement with The Great American Food Chain that includes a common stock dividend for shareholders of Franchise Capital Corporation in consideration for the sale of Franchise Capital Corporation's interest in Kokopelli Franchise Company, LLC.
Under the terms of the agreement, The Great American Food Chain will receive Franchise Capital Corporation's 90% interest in Kokopelli Franchise Company, LLC. In consideration of the receipt of the interest in Kokopelli, The Great American Food Chain will deliver of up to 720,629 shares of its restricted common stock to the shareholders of Franchise Capital Corporation and assume a note payable, which Franchise Capital carried related to the asset.
All Franchise Capital Corporation shareholders of record as of August 31, 2006, as listed with the company's transfer agent and registrar, Transfer Online, will be eligible for the stock dividend. Shares will be issued at a ratio of one Great American Food Chain share for every 100 shares held in Franchise Capital Corporation. Certificates are expected to be mailed to eligible shareholders within sixty days of the record date.
The Great American Food Chain, Inc., whose closing stock price as of August 15, 2006 was $.50 per share, is a restaurant holding company based out of Dallas, Texas specializing in the development and expansion of proven independent restaurant concepts into multi-unit locations through corporate owned stores, licensing, and franchising opportunities. In addition to the newly acquired Kokopelli Fresh Mexican Grill, The Great American Food Chain also owns Spikes Boneyard Grill and is finalizing a licensing agreement on a third concept.
The company has also entered into a letter of intent (LOI) with Javelin Advisory Group, Inc. Under the terms of the LOI, Javelin will provide several services for the company including the preparation of financial statements of Franchise Capital and all necessary SEC filings to bring the company current with its filings requirements, organize and oversee a shareholder meeting to withdraw Franchise Capital Corporation's BDC status, and commit to a minimum capitalization target for any merger that would be in line with Nasdaq small-cap requirements.
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