Kona Grill Turns Down Acquisition Offer
Kona Grill, Inc. announced today that it has responded to the expression-of-interest by Mill Road Capital, L.P.
-- Chain Leader, 6/17/2009 8:34:00 AM
PRESS RELEASE: SCOTTSDALE, Ariz., June 16, 2009 (GLOBE NEWSWIRE) -- Kona Grill, Inc. (Nasdaq:KONA) (the "Company") announced today that it has responded to the expression-of-interest by Mill Road Capital, L.P. as of May 18, 2009 to acquire all of the Company's outstanding shares of common stock. The text of the response was as follows:
June 16, 2009
Mill Road Capital L.P.
Two Sound View Drive, Suite 300
Greenwich, Connecticut 06830
Attention: Mr. Thomas Lynch
Dear Mr. Lynch:
Thank you for your letter dated May 18, 2009, wherein you expressed,
on behalf of Mill Road Capital, L.P. and one or more of its
affiliates, an interest in acquiring all outstanding shares of Kona
Grill, Inc.'s (the "Company") common stock in an implied $3.67 per
share cash merger transaction.
Consistent with the Board of Director's (the "Board") and management's
fiduciary duties, we carefully consider all bona fide offers for
strategic and financial transactions submitted to our Board in good
faith, which seek to enhance stockholder value and which otherwise are
fair to and in the best interests of all of our stockholders.
With due respect for Mill Road Capital's capacity as the Company's
second largest stockholder and its continued support as such in the
Company's recently completed subscription rights offering, the Board
has met with the Company's legal and financial advisors to evaluate
and consider your expression-of-interest. Based on such meetings and
evaluation, the Board has concluded that the indicative price per
share in your letter does not reflect, and materially underprices, the
intrinsic value and prospects of the Company and its common stock in
any potential sale of control transaction. Accordingly, we do not
believe it would be prudent to engage in discussions regarding a
potential transaction at this time.
We thank you again for your interest in and support of our Company.
Very truly yours,
Mark Zesbaugh
On Behalf of the Board of Directors
cc: Board of Directors of Kona Grill, Inc
About Kona Grill
Kona Grill restaurants serve a diverse selection of mainstream American dishes as well as a variety of appetizers and entrees with an international influence. Each restaurant also features an extensive sushi menu and sushi bar and is open daily for lunch and dinner. For further information, please visit the Company's website at www.konagrill.com.
Forward-Looking Statements
The statements contained in this release that are not historical facts are forward-looking statements. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, objectives, goals, strategies, future events, or performance and underlying assumptions and other statements that are not purely historical. We have attempted to identify these statements by using forward-looking terminology such as "may," "will," "anticipates," "expects," "believes," "intends," "should," or comparable terms. All forward-looking statements included in this press release are based on information available to us on the date of this release and we assume no obligation to update these forward-looking statements for any reason. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements and the discussion of risk factors contained in the Company's filings with the Securities and Exchange Commission.
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