990360 Restaurant Teams Int’l to Acquire Fatburger Chain

Longview, TX - Restaurant Teams International, Inc. announced that it has signed definitive agreements to acquire the Fatburger hamburger chain from FB Holding Corp. The $8 million acquisition has been approved by the board of directors and shareholders of FB Holding Corp. and the board of directors of Restaurant Teams International. Closing is anticipated to occur in April 1999.

Fatburger, founded in 1952, currently operates 13 company owned Fatburger restaurants in the Los Angeles, California market and franchises 22 Fatburger restaurants in Southern California and Las Vegas, Nevada. Three additional franchised locations are slated to open by August of 1999. Currently, there are commitments and deposits for another 24 franchised units throughout the United States.

Restaurant Teams expects system-wide sales for current Fatburger restaurants to approach $26,000,000 in 1999. Operating cash flow of Restaurant Team's Fatburger division is expected to be approximately $2,000,000 in 1999.

Henry Leonard, President and Chief Operating Officer of Restaurant Teams International stated, “We are enthusiastic about the acquisition of Fatburger. The Fatburger concept captures a unique and winning niche in the burger segment with excellent margins and sales to investment ratios. In addition, the opportunity to acquire a chain with the history and expansion potential of Fatburger represents a significant step in realizing Restaurant Teams International, Inc.'s growth strategy of becoming a multi-concept holding company.”

The Fatburger name was chosen in 1952 by founder Lovie Yancey when the expression “Fat” was used to describe something that was cool or big. Although the name would indicate otherwise, Fatburger hamburgers were found to have the lowest fat content among major chains in the Los Angeles area in an independent test conducted by Los Angeles television station KNBC.

Fatburger has differentiated the brand since 1952 by positioning the concept as “The Last Great Hamburger Stand.” Products are prepared on premise daily by hand using only fresh USDA grade A beef. Fatburger also cooks french fries and hand-made onion rings in cholesterol free Canola oil. Restaurants use real ice cream in making hand-dipped shakes, malts and floats. In addition, Fatburger restaurants offer a 1950's themed environment featuring display kitchens, counter seating, jukeboxes, neon and drive-thru windows.

Over the years Fatburger has become synonymous with the Los Angeles lifestyle and has become a favorite dining spot for athletes and celebrities. When the David Letterman show moved from Los Angeles to New York, Mr. Letterman included eating at Fatburger on his “Top Ten” list (#7) of things the show would miss most about LA. While broadcasting from Los Angeles, Mr. Letterman did several live remotes from Fatburger No.2. Mel Gibson can be seen eating Fatburger french fries in Lethal Weapon 4 and George Foreman rated Fatburger the best hamburger he has ever eaten.

The Fatburger hamburger was voted the best hamburger in Las Vegas according to a readers' poll taken by the Las Vegas News Times and has been chosen the best hamburger in Los Angeles in numerous polls.

Curtis A. Swanson, Chief Financial Officer for Restaurant Teams International commented, “Fatburger is a natural addition to our restaurant mix as we continue our strategy of becoming a multi-concept holding company dedicated to increasing shareholder value. With a 47 year operating history and experienced management team, we expect Fatburger to establish itself as a strong regional and then national brand over the next 5 years.”

Mr. Swanson also commented, “With this acquisition, Restaurant Teams International is poised to move directly to a major national market listing. We are currently reviewing our listing options based on the Fatburger acquisition.”

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