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To OTC Journal Members:

Spicy Pickle (OTC BB: SPKL) Reincarnated

Do you believe in reincarnation? If so, your belief might be reinforced by yesterday's news revelation out of Spicy Pickle. This is a Denver based restaurant chain owning two brands- the Spicy Pickle fast casual brand in the US, and the Bread Garden Urban Cafes in western Canada.

All told, there are about 52 stores in the chain between the two brands. By year's end there will be about 60 with the a number of additional units opening in the Vacouver area. Three of the new Bread Garden units will be smack dab in the middle of the Winter Olympics coming early next year. They have a unit at the Vancouver Airport, the outdoor walking mall at the Whistler Ski Area, and a new one being constructed at the giant sports complex that will hold many of the major winter events.

Spicy Pickle (SPKL) was a huge win for OTC Journal subscribers in the Fall of 2007- two years ago at this time the stock made a run from $.60 to $2 and traded millions of shares between $1.50 and $2.

Unfortunately for both SPKL and its shareholders, the recession took the wind out of their sales, and US based franchise activity in this space has been at a virtual standstill for about 12 months.

SPKL did make one brilliantly strategic move- before the collapse of the equity markets, SPKL, in an all stock transaction, bought the parent company of the Bread Garden Urban Cafes in Vancouver.

Unlike the US, Western Canada was not involved in toxic assets, credit default swaps, or zero down, non qualified mortgages. There's was a bit of a slow down temporarily up there, but nothing like we've seen here.

The Bread Garden Urban Cafe chain has been growing gangbusters, and it is starting to achieve meaningful critical mass for Spicy Pickle. There were only 3 Bread Garden locations a year ago- now there's about 16 with several more opening in the near future.

There was big news out of SPKL yesterday, and once investors understand what has happened, it could put a charge back into a stock that has been dead on the screen and languishing between $.15 and $.20 for most of 2009.

In December of 2007 SPKL issued $6 million in covertible preferred shares. The conversion price was $.85. However, there were two provisions of interest to shareholders. One allowed the company to buy back the preferred at a reasonable premium within a certain time frame. With the current market conditions, it's pretty clear that wasn't going to happen.

Secondly and far more onerous for the market was the provision that allowed for a much lower conversion price in the future, which could have led to massive dillution.

Yesterday, SPKL pulled off the coup of coups, and rid itself completely of that convertible preferred while at the same time raising an additional $2.1 million cash.

$800,000 of that capital went to buy out a huge chunk of the preferred at about $.20 on the dollar. The remainder of that particular investor's preferred was converted to common stock at $1.25 per share.

The remaining preferred holders- myself included to the tune of $102,000, converted our preferred into common stock at $.425 per share- nearly three times the current market price of the stock.

If this seems a bit confusing it's because it is a bit confusing. To make it simple, I'll simply point out there are no more preferred shares which represented massive potential dillution, and the company is cashed back up with an excess $1.2 million to fuel its operations from here forward. The transaction closed yesterday.

One more simple point- the remaining preferred holders which includes yours truly accepted our shares at $.425 - nearly triple the current market, and we all own some warrants that convert at $.20. All in all, a massive win for shareholders.

I believe this news, as investors start to understand it, will put a charge back in SPKL. It could trade into the $.25 range in short order. We'll see.

Looking a bit further down the road, SPKL, in my view, is likely to turn at least cash flow positive in Q1 of 2010, and now they have the cash in hand to absorb the small loss they will notch over the remainder of this year.

The Bread Garden Urban Cafe chain is not only expanding very rapidly in Western Canada, but there's also a pilot unit open in Australia as an experiment.

Franchise interest is stating to pick up in the US as the economy improves and capital is starting to slowly become available. There's no reason this stock couldn't go back to $.40 to $.50 this year, and possibly higher next.

I believe you are going to see a lot of this with smaller companies. If this year's recession didn't kill them, they will cut favorable arrangements with financiers and come back to life. It's kind of like renegotiating your mortgage. The bank would rather take the write down and have you in a mortgage you can afford. The financiers just took a big write down on Spicy Pickle, and SPKL shareholders got out from under a big obligation to their benefit.

With the stock so blown out, it will probably have a big surge to the upside in the short term. That's typical of these kinds of situations- see recent idea BOCX as the model. Completely blown out and the stock quadrupled on the first reasonable volume in months.

The same thing could happen here.

Here's the complete text of the news for your review:

Spicy Pickle Converts Preferred Stock Along With Capital Raise

DENVER, CO--(Marketwire - 09/23/09) - Spicy Pickle Franchising, Inc. (OTC.BB:SPKL - News), fast casual restaurant operator and franchisor under its Spicy Pickle and Bread Garden Urban Caf? brands, today announced that it completed two financing transactions. The first one was a private placement whereby the Company will issue approximately 16 million shares of its common stock and warrants to purchase an additional 8 million shares for gross proceeds of $2.1 million. The exercise of the warrants will bring additional funding to the Company when exercised. The second transaction redeemed approximately 94 shares of the outstanding Preferred Series A shares for $800,000 in cash and converted the remaining preferred shares into common stock. Approximately 308 preferred shares were converted at a rate of $1.25 per common share for which the Company issued approximately 2 million common shares. The balance of approximately 237 preferred shares were converted at a rate of $0.425 per common share for which the Company issued approximately 4.7 million common shares.

Spicy Pickle CEO Marc Geman said, "Importantly, these extremely beneficial transactions show strong belief in our company by the preferred shareholders and the participants in the equity offering. The conversions are considerably above current market and indicate confidence that our company has significant future value. In addition, the conversions eliminate a dividend paying security from our balance sheet and also eliminate provisions of the preferred securities that made additional financing extremely difficult. These transactions provide us with working capital and eliminate an overhang on the market for our stock and an obstacle to future financing.

"The number of shares issued on the conversions is only a fraction of what would have been issued if the preferred securities remained in place based on their price setting provisions. Therefore, we have saved shareholders from considerable potential dilution. It is to their credit that the preferred holders cooperated in this transaction. This gives us the best of both worlds."

Mr. Geman further stated, "With the strain of financing removed we look forward to turning our full attention to our core business which is the franchising of our Spicy Pickle and Bread Garden Urban Caf? restaurants in the U. S. and Canada and the continued development of healthy and great tasting food for our customers."

About Spicy Pickle?:

Founded in 1999, Spicy Pickle Franchising, Inc. (OTC.BB:SPKL - News) serves high quality meats and fine artisan breads, baked fresh daily, along with a wide choice of eight different cheeses, twenty-two different toppings, and fourteen proprietary spreads to create healthy and delicious panini and sub sandwiches with flavors from around the world. As a leading "fast-casual" concept, Spicy Pickle offers menu items that are far beyond traditional fast food but without the price point of casual dining. The hallmark of a Spicy Pickle restaurant is quality, service and an enjoyable atmosphere. The company is headquartered in Denver, Colorado, with restaurants open across 11 states and more in development nationwide. Spicy Pickle Franchising, Inc. also operates as franchisor for Bread Garden Urban Cafes, a popular caf? concept in Vancouver over the past 30 years. Bread Garden Urban Cafes serve coffee, pastries and breakfast items as well as lunch and dinner along with a wide variety of desserts. The cafes are a gathering place offering wifi and late night hours in several of the locations. Bread Garden Urban Cafes are found throughout metropolitan Vancouver as well as at Whistler Mountain and the Kamloops Airport in British Columbia. To find out more about Spicy Pickle (OTC.BB:SPKL - News), visit our website at www.spicypickle.com and www.Breadgarden.com.

Forward-Looking Statements:

Certain statements in this press release, including statements regarding the number of restaurants we intend to open, are forward-looking statements. We use words such as "anticipate," "believe," "could," "should," "estimate," "expect," "intend," "may," "predict," "project," "target," and similar terms and phrases, including references to assumptions, to identify forward-looking statements. The forward-looking statements in this press release are based on information available to us as of the date any such statements are made and we assume no obligation to update these forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, the following: factors that could affect our ability to achieve and manage our planned expansion, such as the availability of a sufficient number of suitable new restaurant sites and the availability of qualified franchisees and employees; risks relating to our expansion into new markets; the risk of food-borne illnesses and other health concerns about our food products; changes in the availability and costs of food; changes in consumer preferences, general economic conditions or consumer discretionary spending; the impact of federal, state or local government regulations relating to our franchisees and employees, and the sale of food or alcoholic beverages; the impact of litigation; our ability to protect our name and logo and other proprietary information; the potential effects of inclement weather; the effect of competition in the restaurant industry; and other risk factors described from time to time in our SEC reports.

Contact:

Company Contact:
Marc Geman
Spicy Pickle Franchising, Inc.
Email Contact
www.spicypickle.com
(303) 297-1902
Woody Wallace
The Investor Relations Company
Email Contact
312-245-2700