INDIANAPOLIS and ROANOKE, Va., Aug. 13 /PRNewswire-FirstCall/ -- The Steak n Shake Company ("SNS") (NYSE: SNS), and Western Sizzlin Corporation ("Western") (Nasdaq: WEST), today jointly announced the execution of a non-binding Letter of Intent relating to a proposed merger of Western into a wholly-owned subsidiary of SNS. The Letter of Intent was negotiated between special committees of the boards of directors of both companies both of which were composed entirely of independent directors.
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The Letter of Intent contemplates that on or prior to closing Western will distribute to its stockholders all of the SNS shares beneficially owned by Western. Further, under the terms of the Letter of Intent, the consideration payable to Western's stockholders will be based on a net transaction valuation of approximately $22,959,000.00. At closing, each share of Western's common stock would be converted into the right to receive an amount equal to approximately $8.11 in the principal amount of debentures issued by SNS. It is anticipated that the SNS debentures will have a term of five (5) years, will bear interest at the rate of 14 percent per annum and will be pre-payable without penalty at the option of SNS after one (1) year from the date of issuance.
The closing of the transaction is subject to certain conditions, including negotiation and execution of definitive documentation and the satisfactory completion of the parties' due diligence. In addition to definitive documentation, the consummation of a transaction would be subject to final approval by the parties' boards of directors and approval by Western's stockholders, and the satisfaction of any conditions to closing set forth in the definitive documentation. There can be no assurance that a merger will be consummated or, if consummated, that the terms set forth in the definitive documentation will be consistent with the current expectations of SNS and Western, as contemplated by the terms of the letter of intent.
ABOUT THE STEAK N SHAKE COMPANY
Steak n Shake is a holding company. Its primary restaurant operation is conducted through Steak n Shake Operations Inc.
