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Letter to the Editor
Tuesday July 27
Earl Scheib Agrees to Extend Contingency Period for Buyer
Earl Scheib, Inc. has approved an extension of the contingency period for Elden Holding Group, LLC, a private real estate investment firm, to complete its due diligence investigation of the company from August 3, 2004 to August 21, 2004. The company previously announced on May 20, 2004 that it had entered into a Letter of Intent with Elden whereby Elden will acquire all of the company's issued and outstanding capital stock for approximately $15,000,000 (the "Purchase Price"), plus assumption of certain transaction and related costs estimated at over $2,000,000.The transaction remains subject to the execution of a definitive agreement, completion of due diligence and all requisite regulatory and shareholder approvals. In addition, the Purchase Price is subject to adjustment at the closing based on the level of working capital, as defined, and other financial factors. While not assured, the company believes that these factors will not result in a significant reduction or increase, if any, to the Purchase Price.
Earl Scheib has postponed its Annual Meeting of Stockholders in light of the potential transaction which would require stockholder approval. In the event that the potential transaction does not move forward, the company would then proceed with the necessary preparations for, and hold its Annual Meeting of Stockholders as soon as reasonably possible thereafter. The American Stock Exchange has consented to the company's process.
Earl Scheib, Inc., founded in 1937, is a nationwide operator of 113 auto paint and body shops located in approximately 100 cities throughout the United States.
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